IMPEACH BUSH

September 21, 2008

Healthcare Premiums Rose 5 Percent

Consumers who are already scrambling to cover their food and gas bills aren't getting any relief from high healthcare costs: Premiums rose 5 percent this year, leaving the typical family with a $3,354 tab for coverage. Since 1999, premiums have more than doubled while wages rose a modest 34 percent and inflation rose 29 percent.

Premiums aren't the only healthcare cost causing financial pain, according to a closely watched annual survey released today by the Kaiser Family Foundation and the Health Research & Educational Trust. More workers this year are also facing higher deductibles, thanks in part to an increase in consumer-driven health plans, which as I've noted before aren't exactly wildly popular with consumers. The survey found that in 2008, 18 percent of workers in employer-sponsored plans have a deductible of at least $1,000, a sharp increase over the 12 percent with a deductible of that size last year. "We may be seeing the tip of the iceberg of a trend toward less comprehensive, skimpier benefits for people, with higher deductibles and higher out-of pocket-costs," said Kaiser President and CEO Drew Altman at a press conference announcing the survey findings.

September 26, 2008

A bad day for the GOP

WASHINGTON (AP) — Even for a party whose president suffers dismal approval ratings, whose legislative wing lost control of Congress and whose presidential nominee trails in the polls, it was a remarkably bad day for Republicans.

A White House summit meeting on Thursday meant to shore up John McCain's shaky campaign "devolved into a contentious shouting match." And that's how McCain's own campaign described it.

September 25, 2008

Fed keeps banks afloat as borrowing hits record level

NEW YORK/LONDON — Banks and money managers borrowed a record amount from the Federal Reserve in the latest week, nearly $188 billion a day on average, showing the central bank went to extremes to keep the banking system afloat amid the biggest financial crisis since the Great Depression.

The data on borrowing from the Fed closed out another day of high anxiety in global money markets. Key measures of funding stress hit record levels on both sides of the Atlantic as nervous market participants awaited developments from Washington on a $700 billion financial bailout plan.

September 25, 2008

Jobless claims soar near 7-year high

NEW YORK (CNNMoney.com) -- In the first economic reading from the period since the Wall Street crisis erupted, a government report Thursday showed initial unemployment claims rose last week much more than expected.

According to a study by the Department of Labor, initial filings for state jobless benefits increased by a seasonally adjusted 32,000 to 493,000 in the third week of September. It was the highest number of weekly claims since Sept. 29, 2001, when unemployment soared in the wake of the Sept. 11 terrorist attacks.

September 25, 2008

New home sales fall to 17-year low

NEW YORK (CNNMoney.com) -- The pace of new home sales fell to its lowest level in 17 years in August, according to a key government report released Thursday that signaled more dismal news for the housing sector in coming months.

August sales came in at a seasonally adjusted annual rate of 460,000, the Census Bureau report showed, down 11.5% from a revised 520,000 in July. The reading was well below the consensus forecast of 513,000, according to economists surveyed by Briefing.com.

September 25, 2008

Letterman Takes On McCain

"I'm more than a little disappointed by this behavior," Letterman said. "We're suspending the campaign. Suspending it because there's an economic crisis, or because the poll numbers are sliding?"

"You don't suspend your campaign," he added. "Do you suspend your campaign? No, because that makes me think, well, you know, maybe there will be other things down the road -- if he's in the White House, he might just suspend being president. I mean, we've got a guy like that now!"

Then in the midst of interviewing MSNBC's Keith Olbermann, Letterman learned that the GOP candidate was about five blocks away at CBS News headquarters, preparing for an interview with Couric.

Incredulous, Letterman interrupted his chat with Olbermann to show the audience a live shot on the internal CBS news feed of McCain getting touched up by a makeup artist as he waited to talk to Couric.

September 21, 2008

Top Alaskan GOPer Decries McCain Camp's Interference in Palin-Troopergate Probe

Republican State Senator Lyda Green, the president of the Alaska Senate, has been no fan of Governor Sarah Palin. After John McCain tapped Palin to be his running mate, Green told the Anchorage Daily News, "She's not prepared to be governor. How can she be prepared to be vice president or president? Look at what she's done to this state. What would she do to the nation?"

For two years, Green feuded with Palin over key policy matters. But in recent days, Green has become even more dismayed with the Palin pick, for she believes the McCain-Palin campaign has undermined the rule of law in the Last Frontier. She says she has watched with outrage as McCain-Palin operatives have flown into her state and interfered with the so-called Troopergate investigation--the official, approved-by-the-legislature inquiry into whether Palin dismissed her public safety commissioner because he refused to fire her ex-brother-in-law, a state trooper who went through a messy divorce with Palin's sister.

September 24, 2008

McCain Cancels Debate

John McCain is calling for a delay in Friday's national security debate with Barack Obama at the University of Mississippi, but the school is moving full steam ahead, according to a statement released this afternoon. The Associated Press also reported that Obama is seeking to keep the debate on schedule.

"The University of Mississippi is going forward with the preparation for the debate. We are ready to host the debate, and we expect the debate to occur as planned," the statement said, "At present, the University has received no notification of any change in the timing or venue of the debate. We have been notified by the Commission on Presidential Debates that we are proceeding as scheduled."

September 22, 2008

CEOs involved in financial meltdown paid millions

• Lehman Brothers Chairman and CEO Richard Fuld Jr. received compensation valued at $34 million in 2007. Lehman (OTC:LEHMQ) filed for Chapter 11 bankruptcy protection earlier this month.
• Goldman Sachs (NYSE:GS), which Sunday gained Federal Reserve Bank approval to become a bank holding company, paid Chairman and CEO Lloyd Blankfein $70 million last year. Co-Chief Operating Officers Gary Cohn and Jon Winkereid were granted compensation worth $72.5 million and $71 million, respectively.
• Morgan Stanley Chairman John Mack earned $1.6 million. Chief Financial Officer Colin Kelleher got $21 million in compensation last year. Morgan Stanley (NYSE:MS) this week received approval to become a bank holding company, a shift that allows Morgan and Goldman to bring in bank deposit assets, which offer more solid financial footing.
• Merrill Lynch CEO John Thain was paid $17 million in salary, bonuses and stock options in 2007. Merrill (NYSE:MER) is being acquired by Bank of America (NYSE:BAC). BofA CEO Kenneth Lewis earned $25 million in 2007.
• JP Morgan Chase & Co. Chairman and CEO James Dimon earned $28 million in 2007. Chase (NYSE:JPM) acquired troubled investment house Bear Stearns earlier this year, with the federal government promising to take on as much as $30 billion in Bear assets to help get the deal done.
• Fannie Mae CEO Daniel Mudd received $11.6 million in 2007. His counterpart at Freddie Mac, Richard Syron, brought in $18 million. The federal government announced earlier this month it was taking over the mortgage backers with Herbert Allison to serve as Fannie CEO and David Moffett the new CEO at Freddie.
• Wachovia Corp. Chairman and CEO G. Kennedy Thompson received $21 million in 2007. He was succeeded by Robert Steel as CEO in July. Steel is slated to get a $1 million salary with an opportunity for a $12 million bonus, according to CEO Watch. Wachovia (NYSE:WB) is one of the banks that could be sold in the midst of the financial crisis.
• Seattle-based Washington Mutual (NYSE:WAMU) will pay its new CEO, Alan Fishman, a salary and incentive package worth more than $20 million through 2009 for taking the helm of the battered bank, according to the Puget Sound Business Journal.

September 24, 2008

Economic Fears Give Obama Clear Lead Over McCain in Poll

Turmoil in the financial industry and growing pessimism about the economy have altered the shape of the presidential race, giving Democratic nominee Barack Obama the first clear lead of the general-election campaign over Republican John McCain, according to the latest Washington Post-ABC News national poll.

Just 9 percent of those surveyed rated the economy as good or excellent, the first time that number has been in single digits since the days just before the 1992 election. Just 14 percent said the country is heading in the right direction, equaling the record low on that question in polls dating back to 1973.

The story is very misleading but here it is anyway. Sure the bailout is a small percentage of all mortgage debt, but it's a very large percentage of the new debt that was created during the Bush years.

September 24, 2008

Your Guide To The Bailout Debate

Washington, D.C. As congressmen meet behind closed doors, they're weighing a complex raft of issues with virtually no time to make a decision on a proposed $700 billion bailout package from the U.S. Treasury. The stock market is on tenterhooks, credit markets are frozen and Fed Chairman Ben Bernanke has warned Congress that a lack of action could lead to recession. Here's what they're fighting about.

In testimony on Capitol Hill Wednesday, Bernanke explained that there were "various metrics" that could be used to arrive at that $700 billion number. It is 5% of $14 trillion in outstanding mortgage debt and roughly the same percentage of the $10 trillion to $12 trillion of commercial bank assets. "So it seems like an appropriate amount relative to the size of the problem," he told lawmakers.

September 24, 2008

Existing home sales sink again

NEW YORK (CNNMoney.com) -- Sales of existing homes fell in August, according to the latest reading on the battered housing market released Wednesday by an industry trade group.

The National Association of Realtors reported that sales by homeowners sank in August to an annual pace of 4.91 million, down 2.2% from the revised July reading of 5.02 million. It was the ninth month in a year in which the sales pace fell.

September 22, 2008

Most Americans think U.S. is losing war on terrorism

WASHINGTON -- A majority of Americans think the United States isn't winning the war on terrorism, a perception that could undermine a key Republican strength just as John McCain and Barack Obama head into their first debate Friday night, a clash over foreign policy and national security.

A new Ipsos/McClatchy online poll finds a solid majority of 57 percent thinking that the country can win the war on terrorism but a similar majority of 54 percent saying that the country is NOT winning it.

September 23, 2008

McCain Loses His Head

Under the pressure of the financial crisis, one presidential candidate is behaving like a flustered rookie playing in a league too high. It is not Barack Obama.

Channeling his inner Queen of Hearts, John McCain furiously, and apparently without even looking around at facts, said Chris Cox, chairman of the Securities and Exchange Commission, should be decapitated. This childish reflex provoked the Wall Street Journal to editorialize that "McCain untethered" -- disconnected from knowledge and principle -- had made a "false and deeply unfair" attack on Cox that was "unpresidential" and demonstrated that McCain "doesn't understand what's happening on Wall Street any better than Barack Obama does."

September 22, 2008

Experts See a Need for Punitive Action in Bailout

As economists puzzle over the proposed details of what may be the biggest financial bailout in American history, the initial skepticism that greeted its unveiling has only deepened.

Some are horrified at the prospect of putting $700 billion in public money on the line. Others are outraged that Wall Street, home of the eight-figure salary, may get rescued from the consequences of its real estate bender, even as working families give up their houses to foreclosure.

Most economists accept that the nation's financial crisis — the worst since the Great Depression — has reached such perilous proportions that an expensive intervention is required. But considerable disagreement centers on how to go about it. The Treasury's proposal for a bailout, now being negotiated with Congress, is being challenged as fundamentally deficient.

"At first it was, 'thank goodness the cavalry is coming,' but what exactly is the cavalry going to do?" asked Douglas W. Elmendorf, a former Treasury and Federal Reserve Board economist, and now a fellow at the Brookings Institution in Washington. "What I worry about is that the Treasury has acted very quickly, without having the time to solicit enough opinions."

September 22, 2008

Paul Krugman: Cash for trash

PRINCETON, New Jersey: Some skeptics are calling Henry Paulson's $700 billion rescue plan for the U.S. financial system "cash for trash." Others are calling the proposed legislation the Authorization for Use of Financial Force, after the Authorization for Use of Military Force, the infamous bill that gave the Bush administration the green light to invade Iraq.

There's justice in the gibes. Everyone agrees that something major must be done. But Paulson is demanding extraordinary power for himself - and for his successor - to deploy taxpayers' money on behalf of a plan that, as far as I can see, doesn't make sense.

So let's try to think this through for ourselves. I have a four-step view of the financial crisis:

1. The bursting of the housing bubble has led to a surge in defaults and foreclosures, which in turn has led to a plunge in the prices of mortgage-backed securities - assets whose value ultimately comes from mortgage payments.

2. These financial losses have left many financial institutions with too little capital - too few assets compared with their debt. This problem is especially severe because everyone took on so much debt during the bubble years.

3. Because financial institutions have too little capital relative to their debt, they haven't been able or willing to provide the credit the economy needs.

4. Financial institutions have been trying to pay down their debt by selling assets, including those mortgage-backed securities, but this drives asset prices down and makes their financial position even worse. This vicious circle is what some call the "paradox of deleveraging."

September 22, 2008

Goldman, Morgan Stanley Bring Down Curtain on an Era

Sept. 22 (Bloomberg) -- The Wall Street that shaped the financial world for two decades ended last night, when Goldman Sachs Group Inc. and Morgan Stanley concluded there is no future in remaining investment banks now that investors have determined the model is broken.

The Federal Reserve's approval of their bid to become banks ends the ascendancy of the securities firms, 75 years after Congress separated them from deposit-taking lenders, and caps weeks of chaos that sent Lehman Brothers Holdings Inc. into bankruptcy and led to the rushed sale of Merrill Lynch & Co. to Bank of America Corp.

Oddly enough the Democrats are right on this one...the economy is still on the verge of complete collapse and the only that can stop it (maybe) is a massive bailout. But if anyone thinks the bailout will fix things, they're delusional. It'll buy us some time and that's all.

September 21, 2008

The Complete (Though Ever-Changing) Elite Consensus Over the Financial Collapse

"When you listened to him describe it you gulped," said Senator Charles E. Schumer, Democrat of New York.

As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program "Good Morning America," the congressional leaders were told "that we're literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally."

Mr. Schumer added, "History was sort of hanging over it, like this was a moment."

Since this article was written Treasury has in fact asked for the authority to bailout foreign banks too.

September 22, 2008

U.S. weighs bailout of foreign banks, too

PARIS: The financial crisis that began in the United States spread to many corners of the globe. Now, the U.S. bailout looks as if it is going global, too, a move that could raise its cost and intensify scrutiny by Congress and critics.

Foreign banks, which were initially excluded from the plan, lobbied successfully over the weekend to be able to sell the toxic U.S. mortgage debt owned by their American units to the Treasury, getting the same treatment as United States banks.

September 21, 2008

Loan Titans Paid McCain Adviser Nearly $2 Million

Senator John McCain's campaign manager was paid more than $30,000 a month for five years as president of an advocacy group set up by the mortgage giants Fannie Mae and Freddie Mac to defend them against stricter regulations, current and former officials say.

Mr. McCain, the Republican candidate for president, has recently begun campaigning as a critic of the two companies and the lobbying army that helped them evade greater regulation as they began buying riskier mortgages with implicit federal backing. He and his Democratic rival, Senator Barack Obama, have donors and advisers who are tied to the companies.

Isn't this the biggest problem in the country...and McCain says he's the solution. Good god, the man is as bad as Bush.

September 22, 2008

McCain-Palin Storm Troopers have dropped into Alaska and taken over the department of law

Political partisanship has nothing to do with the current outrage of many Alaskans. McCain-Palin Storm Troopers have dropped into Alaska and taken over the department of law. Alaska has become a battlefield in the war for the White House. Senators Hollis French, Bill Wielechowki, Kim Elton, Investigator Steve Branchflower and Walt Monegan are the public targets.

The Alaskan Constitution, the Rule of Law, and the Citizens of Alaska are the collateral damage. It isn't too dramatic to say we are having a Constitutional Crisis when our Attorney General, Talis Colberg, is instructing Alaskans to break the law by ignoring subpoenas.

September 22, 2008

82% Say National Economy is Getting Worse

George W. Bush's Overall Job Approval Matches ARG Low
As 82% Say National Economy is Getting Worse

George W. Bush's overall job approval has matched its low in American Research Group monthly polling as 82% of Americans say the national economy is getting worse, according to the latest survey from the American Research Group.

September 21, 2008

Paulson's monster

More details have been disclosed over night about the new state-owned institution being created by Hank Paulson, the US Treasury Secretary, to purchase distressed US mortgages and securities manufactured from those mortgages.

He wants to raise $700bn for this institution, from the sale of US government bonds in tranches of $50bn. That $700bn is about 35 per cent more than the entire annual budget of the US defence department.

And to facilitate the funding, the statutory ceiling on US public debt is being raised from $10.6 trillion to $11.3 trillion a rise of 6.6 per cent - which puts this ceiling at around a fifth less than the entire annual output of the US economy.

The central problem remains...who bails out the US government when foreign countries decide the US dollar is too risky? What happens when our debt is so large the world loses confidence in our ability to pay it back? The collapse is ongoing. Until we get a grip on deficits and debt (created mostly by tax cuts), the band-aid approach to fixing our economy is only temporary.

September 20, 2008

Armageddon was minutes away

The US Government has just admitted that the financial system was on the verge of total meltdown. And it's right. On Thursday, even blue chip companies were having difficulty rolling over their short-term borrowings.

Armageddon was minutes away - averted by Hank Paulson's plan to insure money-market funds and cut the gangrene out of the banking system.

September 19, 2008

Nationalizing bad debt

As I put it on the Ten O'Clock News last night, yesterday's co-ordinated intervention by central banks, led by the US Federal Reserve, to pump an additional $180bn of short-term loans into the banking system treats only a symptom, not the cause, of banks' reluctance to lend to each other and to us.

It's a stopgap, while Paulson prepares to absolve many of the world's biggest banks of their idiocy during the boom years, by nationalising their bad debts.

One important new stress has been a significant withdrawal of investors' cash from US money-market funds, because of the perception that the funds aren't as safe as was widely thought - which has in turn deprived banks of an important source of wholesale deposits (this sudden rise in the perceived riskiness of these funds was sparked by the announcement of a loss at the Reserve Primary Fund).

The drying-up of liquidity from money-market funds is in part what drove HBOS to acknowledge that the game was up, and that a rescue takeover by Lloyds TSB was the best form of protection for its savers and shareholders.

Possibly the biggest risk for the US is that in bailing out the finances of the private sector, Paulson would dent international investors' confidence in the American government's balance sheet - which could ultimately undermine the dollar, push up inflation even more and raise the cost of servicing debt for the US authorities.

Maybe the US is still big enough and powerful enough to persuade the rest of the world to pay for the mistakes of its financial sector - which is broadly what's being proposed.

But, as I mentioned here yesterday, surely it would be more rational for the Chinese to own the American financial system itself, rather than lend to the US Government (and in that context, it's resonant that Morgan Stanley may well be close to selling almost half of itself to CIC, China's state investment fund).

This site too was way ahead of the game Large U.S. bank collapse ahead dated August 19, 2008.

September 21, 2008

The meltdown: They saw it coming

Now much of the financial industry has gone over the cliff. And as one of the most incorrigible bears on the street, the editor and author of the gloomy Grant's Interest Rate Observer should be doing a victory lap and saying "I told you so."

"Nobody has been bearish enough," Grant said. "I, looking back on it, was not nearly enough of a calamity hollerer. What you did not read in Grant's was that the socialization of credit risk, a long-run trend, would yield in a few weeks an outright nationalization of our financial system. That sentence we did not write. So many things have happened in so dramatic and so violent a way that one is thunderstruck."

Kenneth Rogoff, an economics professor at Harvard University and former chief economist of the International Monetary Fund, also has reason to point to his foresight. At a conference a year ago, he predicted that a major bank would fail. In July he doubted Treasury Secretary Hank Paulson's assertion that Fannie Mae and Freddie Mac could remain in the same form. They were "toast," Rogoff said.

September 20, 2008

Truthiness Stages a Comeback

All campaigns, Obama's included, engage in false attacks. But McCain, Sarah Palin and their surrogates keep repeating the same lies over and over not just to smear their opponents and not just to mask their own record. Their larger aim is to construct a bogus alternative reality so relentless it can overwhelm any haphazard journalistic stabs at puncturing it.

When a McCain spokesman told Politico a week ago that "we're not too concerned about what the media filter tries to say" about the campaign's incessant fictions, he was channeling a famous Bush dictum of 2003: "Somehow you just got to go over the heads of the filter." In Bush's case, the lies lobbed over the heads of the press were to sell the war in Iraq. That propaganda blitz, devised by a secret White House Iraq Group that included Rove, was a triumph. In mere months, Americans came to believe that Saddam Hussein had aided the 9/11 attacks and even that Iraqis were among the hijackers. A largely cowed press failed to set the record straight.

When a court has to order Cheney to follow the law, we know we've got a problem.

September 20, 2008

Cheney Is Ordered to Preserve Records

WASHINGTON (AP) — A federal judge on Saturday ordered Dick Cheney to preserve a wide range of records from his time as vice president.

The decision by the judge, Colleen Kollar-Kotelly, is a setback for the Bush administration in its effort to promote a narrow definition of materials that must be safeguarded under the Presidential Records Act.

September 18, 2008

US Needs $700bn To Avoid Disaster

Bush is urging lawmakers to move quickly as negotiators from Congress and the White House work through the weekend to thrash out details of the draft bill.

The US Treasury admits the move to guarantee bad mortgages is risky, but says it is necessary to avoid sweeping job cuts and a further housing crash that would cripple the American economy.

September 20, 2008

One thought pushes fence-sitters to the left: Palin

ST. PETERSBURG — Five weeks ago, the St. Petersburg Times convened a group of Tampa Bay voters who were undecided about the presidential election. Their strong distrust of Barack Obama suggested it was a group ripe for John McCain to win over.

Not anymore. The group has swung dramatically, if unenthusiastically, toward Democrat Obama. Most of them this week cited the same reason: Sarah Palin.

September 16, 2008

SEC Pushes Hedge Fund Oath in Manipulation Probe

Sept. 20 (Bloomberg) -- The U.S. Securities and Exchange Commission, seeking to jumpstart a hunt for suspected manipulation of financial stocks, will require hedge fund managers, brokerages and institutional investors to describe under oath their bets on the firms.

Investors with "significant" trades in the companies' securities or credit default swaps must disclose their positions and provide "certain other information" in written statements, the regulator said yesterday. SEC spokesman John Nester declined to say who would receive the requests.

September 18, 2008

Long Regarded as Safe, Money-Market Funds Are Pulled Into Peril

The cascading losses on Wall Street increasingly threaten the safety of investments in money-market mutual funds, which have long enjoyed a reputation for being almost as safe as bank accounts.

Money-market funds aim to invest in low-risk debt issued by the government and healthy corporations, allowing the funds to pay investors a marginally higher interest rate than an average savings account.

September 18, 2008

Worst Crisis Since '30s, With No End Yet in Sight

The financial crisis that began 13 months ago has entered a new, far more serious phase.

Lingering hopes that the damage could be contained to a handful of financial institutions that made bad bets on mortgages have evaporated. New fault lines are emerging beyond the original problem -- troubled subprime mortgages -- in areas like credit-default swaps, the credit insurance contracts sold by American International Group Inc. and others. There's also a growing sense of wariness about the health of trading partners.

The consequences for companies and chief executives who tarry -- hoping for better times in which to raise capital, sell assets or acknowledge losses -- are now clear and brutal, as falling share prices and fearful lenders send troubled companies into ever-deeper holes. This weekend, such a realization led John Thain to sell the century-old Merrill Lynch & Co. to Bank of America Corp. Each episode seems to bring government intervention that is more extensive and expensive than the previous one, and carries greater risk of unintended consequences.

September 17, 2008

As Fears Grow, Wall St. Titans See Shares Fall

Even Morgan Stanley and Goldman Sachs, the two last titans left standing on Wall Street, are no longer immune.

To the surprise of executives within those firms, and their rivals, the stocks of these powerful companies were drawn into the crisis of investor confidence on Wednesday. Morgan Stanley, whose stock fell almost 25 percent, was considering a merger with Wachovia or another bank to help shore up its finances. Goldman Sachs's stock fell almost 14 percent, and it had to rebuff rumors that it was seeking a capital infusion.

The assault on these two companies underscored how quickly a sense of fear is spreading through Wall Street. Both firms just reported respectable profits on Tuesday, and were considered in a separate class from weaker banks like Bear Stearns and Lehman Brothers that saw the value of their businesses evaporate.

September 17, 2008

McCain Opposed AIG Bailout, Until Bush Bailed out AIG

Sept. 17 (Bloomberg) -- Republican presidential candidate John McCain, shifting his position, suggested the government's $85 billion takeover of American International Group Inc. was unavoidable as both he and rival Barack Obama blamed regulators.

"On the bailout itself, I didn't want to do that," the Republican presidential nominee said on ABC's "Good Morning America" program today. "But there were literally millions of people whose retirement, whose investments, whose insurance were at risk here, and they were going to have their lives destroyed because of the greed and excess and corruption."

September 17, 2008

Current account deficit widens to 5.1% of GDP

WASHINGTON (MarketWatch) - The U.S. current account deficit widened to $183.1 billion in the second quarter, or 5.1% of gross domestic product, the Commerce Department reported Wednesday. The increase in the deficit was accounted for by a decrease in the surplus on income and an increase in the deficit on goods. Read the full report.

The current account is the broadest measure of international flows of goods, services and capital in and out of the United States. In essence, the current account deficit measures how much Americans need to borrow from or sell to foreigners to fund their consumption and investment. The figures are not adjusted for price changes.

September 17, 2008

FBI director seeks outside review of anthrax investigation

WASHINGTON (CNN) -- FBI Director Robert Mueller said Tuesday he will seek an independent review of the scientific process and evidence that allowed the FBI to wrap up its long-running anthrax investigation, but left lingering questions.

In testimony on Capitol Hill on Tuesday, Mueller disclosed he has asked the National Academy of Sciences to conduct an outside probe of the cutting-edge science used by FBI investigators, and contracted research scientists which led them to anthrax researcher Bruce Ivins.

Conservatives don't want to conserve anything. In fact only 13% of republicans in congress think global warming is real.

September 16, 2008

Asian stocks hit by U.S. turmoil

NASA has issued a preliminary report confirming environmentalists' fears of disappearing sea ice at the Arctic.

Sea ice is the thick permanent ice formed by frozen ocean water that remains even as seasonal ice melts away in the summer. In the past, it has covered about 60 percent of the Arctic.

The sea ice at the Arctic has now been found to have melted away by as much as half, according to a preliminary report issued Tuesday by NASA and the NASA-supported National Snow and Ice Data Center at the University of Colorado.

Gore never said he invented the Internet but that never stopped the media from lying about it. In fact, they still refuse to admit they lied. Now it's McCain's turn. Will they crucify him like they did to Gore? Not a chance.

September 17, 2008

John McCain invented the BlackBerry?

John McCain may not be a BlackBerry user. But Tuesday, one of his aides was ready to give the Republican presidential nominee credit for one of the technological marvels of the modern age.

In a comment that brought to mind the 2000 presidential campaign flap over whether Al Gore had invented the Internet, McCain's senior policy advisor said the candidate was responsible for the BlackBerry.

Douglas Holtz-Eakin held up his little device to show reporters in Miami as he sought to explain why McCain was qualified to lead the nation out of its economic morass.

Bush said no more bailouts, then he bailed out AIG. Had he chosen to pander to his base, the US banking system would have collapsed.

September 17, 2008

Fed Takes Control of AIG With $85 Billion Bailout

Sept. 17 (Bloomberg) -- The U.S. government took control of American International Group Inc. in an $85 billion bailout to prevent the bankruptcy of the nation's biggest insurer and the worst financial collapse in history.

The Federal Reserve will provide a two-year loan, take 79.9 percent of the New York-based company's stock and replace its management because "a disorderly failure of AIG could add to already significant levels of financial market fragility," according to a statement by the central bank late yesterday.

September 16, 2008

Overnight Interest Rate Doubles as Banks Hoard Cash on Failure Speculation

Sept. 16 (Bloomberg) -- U.S. stock-index futures declined after a record jump in overnight lending rates and the credit downgrades of American International Group Inc. showed strains on the financial system are intensifying.

AIG plunged 37 percent, Goldman Sachs Group Inc. lost 9.7 percent and Morgan Stanley declined 17 percent as the cost of borrowing in dollars more than doubled, according to the British Bankers' Association. Washington Mutual Inc. fell 12 percent after its credit rating was cut to junk. Dell Inc. dropped 7.7 percent following the computer maker's prediction of slower demand. Energy producers dropped after oil posted the steepest two-day retreat in almost four years.

September 14, 2008

Lehman Brothers CEO Paid $22 Million in 2007

As recently as March, Fuld was awarded a $22 million bonus for 2007 -- a generous pay package to be sure, but one that also reflected a year in which the bank's net profit had risen 5 percent to a record $4.2 billion.

But Lehman soon emerged as Wall Street's next domino as real estate loans and other toxic assets increasingly weighed on its balance sheet, especially after the collapse of Bear Stearns Cos Inc in March.

September 16, 2008

Asian stocks hit by U.S. turmoil

The Dow Jones Euro Stoxx 50 Index, a benchmark for the euro region, lost 1.8 percent, to 3,094.66 in afternoon trading. The CAC-40 lost 1 percent in Paris, the German DAX shed 1.5 percent and the FTSE-100 declined 2.4 percent in London.

Equity markets in Tokyo, Hong Kong and Seoul all slid in their first day of trading since the events Sunday on Wall Street. Those markets had been closed Monday for national holidays.

In Tokyo, the largest Asian stock market, the benchmark Nikkei 225 dropped 4.95 percent Tuesday to 11,609.72 points, a three-year low. The broader Topix index fell 5.07 percent to 1,117.57.

Elsewhere in Asia, the Kospi in Seoul fell 6.1 percent, and the Hang Seng index in Hong Kong closed down 5.44 percent to an almost two-year low. Taiwan's leading index fell 4.9 percent, its lowest in three years, while the composite index in Shanghai dropped 4.5 percent.

So when Palin said she had nothing to hide, was that a lie too?

September 16, 2008

Palin Won't Speak to Special Prosecutor

Since Palin was named McCain's running mate, the campaign has dismissed the state legislature's investigation of her dismissal of the state's director of public safety, saying that Democrats are exploiting the probe for political gain.

McCain campaign spokesman Ed O'Callaghan said that Palin is "unlikely to cooperate" with the investigation, which he called "tainted."

September 16, 2008

Economic future hinges on how quickly feds act —and what they decide to do

"The entire world economy is being held hostage to the welfare of the financial community because we're talking about an industry that provides credit, which is the lifeblood of business and consumer spending," said Bernard Baumohl, chief global economist for The Economic Outlook Group in Princeton, N.J.

It has been generations since the economy teetered close to falling into a depression. Could the massive failed bets made by Wall Street and the desperate efforts to stem the damage sentence the economy to years of stagnation, or worse?

September 16, 2008

AIG Plunges After Ratings Cuts Threaten Efforts to Raise Cash

Sept. 16 (Bloomberg) -- American International Group Inc. fell 38 percent in early New York trading after the insurer's credit ratings were cut, threatening efforts to raise funds to keep the company afloat and roiling global financial markets.

S&P lowered AIG's long-term counterparty rating three grades to A- because of "reduced flexibility in meeting additional collateral needs and concerns over increasing residential mortgage-related losses," the rating company said yesterday. Moody's cut AIG's senior unsecured debt two grades to A2. Fitch Ratings lowered its assessment to A from AA-.

September 16, 2008

Meltdown in US finance system pummels stock markets, Dow down 500 pts

NEW YORK: The upheaval in the American financial system sent shock waves through the stock market Monday, producing the worst day on Wall Street in seven years as investors digested the failure of one of its most venerable banks and wondered which domino would be next to fall.

The Dow Jones industrial average lost more than 500 points, more than 4 percent, its steepest point drop since the day the stock market reopened after the Sept. 11, 2001, attacks.

September 14, 2008

A letter to America: You Cannot be Serious

This is not, historically speaking, a big deal. The American Century may well be at an end, with only the debts - unfeasibly big debts - to be settled. The Chinese, the Arabs, the Europeans, even the Russians hold your IOUs. When the money runs out, aircraft carriers are window dressing. Besides, no-one in the British islands is in a position to talk. Our empire was far more reckless than yours has ever been, and we could not hold a blood-red candle to Spain, France, Germany, Holland or even little Belgium. No-one ever gave thanks for having the Russians or the Chinese in charge. These things come and go.

But you say - Kipling and Rhodes would have understood - that you are the last best hope for mankind. Speaker after speaker at the Republican convention, and more than a few at the Democrat equivalent, talked (boasted?) of the greatest nation in the world ever. No precedent. I refer you once more to British imperial history. I also suggest, though, that when such things are said sincerely, certain obligations follow. You enthuse over Sarah Palin instead.

September 17, 2008

Washington Mutual Begins Auction to Sell Itself

Washington Mutual, the struggling savings and loan, has put itself up for auction, people briefed on the matter said Wednesday.

The unsurprising announcement comes as the bank, which has suffered badly from losses on mortgages it had made, continues to stumble. Shares in Washington Mutual fell nearly 10 percent on Wednesday to $2.09; they have plunged 94 percent over the last 12 months. This week alone, investors have been frightened by Standard & Poor’s cutting of the bank’s debt rating to junk.

September 17, 2008

Wall Street Crashes the 2008 Election

Wall Street just jumped into the race for the White House in a big way. The ongoing crisis in credit markets—and taxpayer assistance for a growing list of troubled companies—is taking center stage for both Presidential campaigns. The issue is also offering voters a peek at each candidate's approach toward greater regulation of financial markets.

Both campaigns are fervently advocating tougher government oversight—a departure from the Bush Administration's more hands-off approach to financial matters. Senator Barack Obama (D-Ill.) argues that America needs a "21st-century regulatory system" and has seized on the liquidity crisis as an indictment of Republican policies. "What we've seen the last few days is nothing less than the final verdict on an economic philosophy that has completely failed," Obama said in a Sept. 16 speech in Golden, Colo.

September 16, 2008

The Golden era of investment banking is over

NEW YORK (Reuters) - It's getting lonely on Wall Street.

Bear Stearns melted down in March and has disappeared inside JPMorgan Chase & Co (JPM.N: Quote, Profile, Research, Stock Buzz), Merrill Lynch absorbed more than $40 billion in write-downs and rushed into the arms of Bank of America, and Lehman Brothers is being sold for scrap after it declared bankruptcy on Monday.

Now investors and analysts worry whether even the largest securities firms, Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) and Morgan Stanley (MS.N: Quote, Profile, Research, Stock Buzz), may be vulnerable as markets lose confidence in the financial foundations on which investment banks are built.

September 17, 2008

NASA: Arctic sea ice at second-lowest level on record

NASA has issued a preliminary report confirming environmentalists' fears of disappearing sea ice at the Arctic.

Sea ice is the thick permanent ice formed by frozen ocean water that remains even as seasonal ice melts away in the summer. In the past, it has covered about 60 percent of the Arctic.

The sea ice at the Arctic has now been found to have melted away by as much as half, according to a preliminary report issued Tuesday by NASA and the NASA-supported National Snow and Ice Data Center at the University of Colorado.

September 17, 2008

Morgan Stanley Said to Consider Merger as Wachovia Calls Mack

Sept. 17 (Bloomberg) -- Morgan Stanley is weighing a merger with Wachovia Corp. and several other banks as the securities firm seeks to regain investor confidence after its shares sank 42 percent this week, people familiar with the matter said.

John Mack, Morgan Stanley's chief executive officer, received a call from Wachovia today indicating interest, said one of the people, who declined to comment because the talks aren't public and may end without an agreement. Such a deal is only one of several options being considered and the New York- based firm is also seeking ways to limit short sales of its stock, said the person.

Yeah right!

September 15, 2008

Bush: no more bailouts

"We are working to reduce disruptions and minimize the impact of these financial market developments on the broader economy," Bush said in the Rose Garden, choosing to address the market turmoil at the top of an appearance with visiting Ghanian President John Kufuor. "The policymakers will focus on the health of the financial system as a whole," Bush said.

His statement seemed to serve notice that the government will not continue to bail out Wall Street, as Lehman Brothers Holdings Inc. filed for bankruptcy, Merrill Lynch & Co. was forced to sell itself to Bank of America, and the world's largest insurance company plans to announce a major restructuring.

September 15, 2008

Stocks spiral as Dow ends below 11,000

NEW YORK - Stocks retreated sharply and Treasury bond prices jumped Monday as investors reacted to a dramatic upheaval on Wall Street that took out two storied names: Lehman Brothers Holdings Inc. and Merrill Lynch & Co. The major indexes each fell more than 3 percent, including the Dow Jones industrial average, which closed below the 11,000 mark.

Stock trading was largely orderly, and not as frenetic as some analysts feared before the market began. But bond prices soared as investors sought the safety of government debt.

It's safe to say all the stories about the "moose killer" will end as reality returns.

September 15, 2008

Shock waves hit Wall St. as 2 big firms fall

NEW YORK - In a stunning reshaping of America's financial landscape, two venerable Wall Street firms fell from the shock waves of a credit crisis that has plunged the financial system into turmoil, as stocks tumbled across the globe Monday.

Lehman Brothers, a 158-year-old investment bank choked by the credit crisis and falling real estate values, filed for Chapter 11 protection in the biggest bankruptcy filing ever and said it was trying to sell off key business units. Bank of America Corp. said it is snapping up Merrill Lynch & Co. Inc. in a $50 billion all-stock transaction.

September 15, 2008

After Lehman, AIG looking at liquidating assets

In a bid to garner $50 billion in liquidity, American International Group Inc., is making last desperate moves to avoid being downgraded by rating agencies when the markets open today. The insurer is already working on a re-structure plan that is expected to be disclosed later today.

It is pursuing a three-part plan to raise $40 billion in liquidity. Among other things, it may pursue immediate sale of airplane leasing business.

September 16, 2008

Obama Raised $66 Million in August, a Record for Single Month

Sept. 14 (Bloomberg) -- Democratic presidential candidate Barack Obama raised more than $66 million in August for his campaign against Republican John McCain, a one-month record.

The Obama campaign added 500,000 new donors en route to surpassing a previous monthly record of $55 million, campaign spokesman Bill Burton said in an e-mail. McCain campaign manager Rick Davis earlier said the candidate raised $50 million last month.

September 15, 2008

Lehman Brothers Removed from Dow Jones

NEW YORK, Sep 15, 2008 (GlobeNewswire via COMTEX) -- Dow Jones Indexes, a leading global index provider, today announced component changes in the Dow Jones Financial Services Titans 30 Index. Lehman Brothers Holdings Inc. (United States, Financial Services, LEH) will be removed from the Dow Jones Financial Services Titans 30 Index and replaced by Mega Financial Holding Co. Ltd. (Taiwan, Financial Services, 2886.TW). Lehman Brothers Holdings Inc. is being removed because it filed for Chapter 11 bankruptcy.

The changes in the Dow Jones Financial Services Titans 30 Index will be effective as of the open of trading on Wednesday, September 17, 2008.

Further information, as well as the complete list of the Dow Jones Financial Services Titans 30 Index, can be found on the Dow Jones Indexes Web site at http://www.djindexes.com. Company additions to and deletions from the Dow Jones Financial Services Titans 30 Index do not in any way reflect an opinion on the investment merits of the company.

Very long and also excellent. You get the answers you want by limiting who knows what's happening and denying information to those who need to know it, then lie about it all. If ever there's a reason not to trust people who are pathological liars, it is now. McCain/Palin are pathological liars.

September 14, 2008

Conflict Over Spying Led White House to Brink

But they had not been asked to give their own written assessments of the legality of domestic espionage. They based their answer in part on the attorney general's certification of the "form and legality" of the president's orders. Yet neither man had been allowed to see the program's codeword-classified legal analyses, which were prepared by John C. Yoo, Addington's close ally in the Justice Department's Office of Legal Counsel. Now they wanted to read Yoo's opinions for themselves.

It is unlikely that the history of U.S. intelligence includes another operation conceived and supervised by the office of the vice president. White House Chief of Staff Andrew H. Card Jr. had "no idea," he said, that the presidential orders were held in a vice presidential safe. An authoritative source said the staff secretariat, which kept a comprehensive inventory of presidential papers, classified and unclassified, possessed no record of these.

The next day -- Saturday, March 6, five days before the March 11 deadline -- Goldsmith brought the Justice Department verdict to the White House. He told Gonzales and Addington for the first time that Justice would not certify the program.

A long silence fell. It lasted three full days.

If Palin had a penis she wouldn't have been considered.

September 14, 2008

Palin's top achievement as mayor was the construction of an ice rink

The mayor oversees a police department created three years before Palin took office; the public works department; the parks and recreation department; a planning office; a library; and a small history museum. Council meetings are in the low-ceilinged basement of the town hall, a former school, and often the only residents who show up to testify are two gadflies. When Palin was mayor, the population was just 5,500.

Palin limited her duties further by hiring a deputy administrator to handle much of the town's day-to-day management. Her top achievement as mayor was the construction of an ice rink, a project that landed in the courts and cost the city more than expected.

We've finally gotten to the point where we have to call a pig a pig. The GOP chose two liars and their base is supporting them. Now we know why the base of the GOP is so dumb...they like being lied to.

How long will it take for Obama to call McCain a liar? If he wants to be president, he has to use that word, not once, not twice, but endlessly until it becomes part of the narrative.

September 12, 2008

Blizzard of Lie

Did you hear about how Barack Obama wants to have sex education in kindergarten, and called Sarah Palin a pig? Did you hear about how Ms. Palin told Congress, "Thanks, but no thanks" when it wanted to buy Alaska a Bridge to Nowhere?

These stories have two things in common: they're all claims recently made by the McCain campaign — and they're all out-and-out lies.

McCain/Palin took one chapter out of the Bush playbook. Lie, get caught, then blame the media for catching the lies. Is McCain an honest man who makes honest mistakes? No, he and Palin shade the truth with so many lies that their base will blame the media for what they're doing. Bush 41 tried to blame the media and he was defeated in a landslide. Let's hope it happens again. We don't need yet another lying ass hole in the White House.

September 13, 2008

Palin's Travel Lies

WASHINGTON - Sarah Palin's visit to Iraq in 2007 consisted of a brief stop at a border crossing between Iraq and Kuwait, the vice presidential candidate's campaign said yesterday, in the second official revision of her only trip outside North America.

But in response to queries about the details of her trip, campaign aides and National Guard officials in Alaska said by telephone yesterday that she did not venture beyond the Kuwait-Iraq border when she visited Khabari Alawazem Crossing, also known as "K-Crossing," on July 25, 2007.

A strong person can handle criticism. A weak person can not. Bush is a very weak person who surrounded himself with "yes" men. Palin is the same.

September 13, 2008

In Office, Palin Hired Friends and Fired Critics

WASILLA, Alaska — Gov. Sarah Palin lives by the maxim that all politics is local, not to mention personal.

"People would bring books back censored," recalled former Mayor John Stein, Ms. Palin's predecessor. "Pages would get marked up or torn out."

Witnesses and contemporary news accounts say Ms. Palin asked the librarian about removing books from the shelves. The McCain-Palin presidential campaign says Ms. Palin never advocated censorship.

September 12, 2008

154,000 Homeless Vets

An estimated 154,000 veterans are homeless on any given night, a national number that represents about a quarter of the adult homeless population. The figure is a 21 percent decrease from 2006.

Homeless vets who served during the Vietnam War represent nearly half the overall total.

3 percent of homeless vets are women; 56 percent are black or Hispanic.

A republican politician with ethics? Now, that would be something wouldn't it?

September 11, 2008

Ethics Adviser Warned Palin, said "the situation is now grave"

In the letter, written before Sen. John McCain picked the Alaska governor as his running mate, former U.S. Attorney Wevley Shea warned Gov. Palin that "the situation is now grave" and recommended that she and her husband, Todd Palin, apologize for "overreaching or perceived overreaching" for using her position to try to get Trooper Mike Wooten fired from the force.

Mr. Shea was acting on his own in writing the letter, with no official capacity. In late 2006, Gov. Palin asked him to co-write an ethics report for Gov. Palin with then-House Democratic leader Ethan Berkowitz that recommended new financial-disclosure rules for elected and appointed officials in the statehouse. That report served as a key document for the ethics bill she later signed into law.

It's nice to see McCain being called a liars. It's about time people call a pig, a pig.

September 13, 2008

Why McCain is going so negative, so often

It's hard to imagine a more unlikely perch for John McCain to be shamed for his increasingly hard-edged and truth-stretching campaign than the middle seat on "The View."

Yet on Friday morning, there sat the Republican nominee — a politician who has built an all but saintly reputation for "straight talk" over the years — caught in a vise between Joy Behar and Barbara Walters and getting a lecture from each on honesty.

"They're lies," Behar said of two recent lines of attack from the McCain campaign.

September 11, 2008

We've seen Palin's likes before -- the 80s supermom

Who can forget James Dobson, who blamed the decline and fall of morality on "working mothers and permissiveness," and told us that real women "are merely waiting for their husbands to assume leadership." He now says "I believe Sarah Palin is God's answer. "

Who can forget Phyllis Schlafly who said the "flight from home is a flight from yourself, from responsibility, from the nature of woman." She now says that "I think a hardworking, well-organized CEO type can handle it very well."

Who can forget Pat Buchanan, scriptwriter of the culture wars? He now says, "For heaven's sakes, I mean, can't you have a traditional woman who is also a — you know, a beauty queen and is a governor? What's the matter?"

September 12, 2008

Palin's husband subpoenaed in 'Troopergate' probe

JUNEAU, Alaska (AFP) - Alaska lawmakers on Friday subpoenaed the husband of Republican vice presidential nominee Sarah Palin in a politically explosive abuse-of-power probe.

The Alaska Senate Judiciary Committee voted 5-3 to subpoena Todd Palin in the legislative investigation into whether his wife, who is Alaska's governor, improperly attempted to fire a state trooper who was her former brother-in-law.

September 12, 2008

US diplomats expelled in Latin America

WASHINGTON (AFP) - Washington tried Friday to play down its concerns in Latin America by attributing the expulsion of its envoys from Bolivia and Venezuela as a byproduct of domestic problems in those countries.

"We regret the actions of both President Hugo Chavez and President Evo Morales to expel our ambassadors in Venezuela and Bolivia," State Department spokesman Sean McCormack told reporters.

McCain was able to lie because the media put his ads on the air and ran them as part of their news stories. The fact that there are still people in this country who will vote for known liars is testimony to their indoctrination.

September 12, 2008

Obama skewers McCain as White House truce scrapped

CONCORD, New Hampshire (AFP) - Barack Obama ripped into 72-year-old John McCain as an out-of-touch economic illiterate who had slept through the Internet revolution as war resumed on the White House trail Friday.

The Democrat vowed to wield the "truth" against his Republican adversary's "lies" and seize the policy high ground, but McCain denied resorting to outright untruths in his escalating attacks on Obama.