Posts Tagged ‘Economy’
“Congress plans to spend $550 million to buy eight jets, a substantial upgrade to the fleet used by federal officials at a time when lawmakers have criticized the use of corporate jets by companies receiving taxpayer funds…
…The congressional shopping list goes beyond what the Air Force had initially requested as part of its annual appropriations. The Pentagon sought to buy one Gulfstream V and one business-class equivalent of a Boeing 737 to replace aging planes. The Defense Department also asked to buy two additional 737s that were being leased.
Lawmakers in the House last week added funds to buy those planes, and plus funds to buy an additional two 737s and two Gulfstream V planes. The purchases must still be approved by the Senate. The Air Force version of the Gulfstream V each costs $66 million, according to the Department of Defense, and the 737s cost about $70 million.
Geoff Morrell, the Pentagon press secretary, said the Department of Defense didn’t request the additional planes and doesn’t need them. ‘We ask for what we need and only what we need,’ he told reporters Wednesday. ‘We’ve always frowned upon earmarks and additives that are above and beyond what we ask for.’”
source: wsj.com
“To get the economy back on track, will President Barack Obama have to break his pledge not to raise taxes on 95 percent of Americans? In a ‘This Week’ exclusive, Treasury Secretary Tim Geithner told me, ‘We’re going to have to do what’s necessary.’ Geithner was clear that he believes a key component of economic recovery is deficit reduction. When I gave him several opportunities to rule out a middle class tax hike, he wouldn’t do it.
‘We have to bring these deficits down very dramatically,’ Geithner told me. ‘And that’s going to require some very hard choices.’ ‘We will not get this economy back on track, recovery will be not strong and sustained, unless we convince the American people that we are going to have the will to bring these deficits down once recovery is firmly established,’ he said…”
source: abcnews.com
“Federal Reserve chairman Ben Bernanke appeared incredibly nervous during an interview aired last night on PBS’ NewsHour, particularly during a question on the ongoing effort to pass legislation that would see the Fed’s books being opened up to a general audit. In a display that will greatly encourage those who continue for push for greater transparency of the privately run Fed’s actions, Bernanke stammered and stuttered his way through the interview, his voice shaking as he attempted to rail against calls to audit the Fed, reciting now familiar and standard lines of propaganda.
‘There’s an effort in Congress, and in the House in particular, to audit what the Federal Reserve does, particularly in monetary policy. How do you feel about that?’ asked PBS’ Jim Lehrer. ‘So that bill, people don’t fully understand what that bill is about. It sounds like, audit the Fed, it sounds like ‘Let’s look at the books.’ That’s what it sounds like.’ Bernanke spluttered…”
source: infowars.com
“The dollar fell to the lowest level this year against the currencies of six major U.S. trading partners as speculation the global economy is emerging from the recession reduced demand for a refuge.
The Australian dollar advanced to the highest level since September against the U.S. currency after the Reserve Bank said the economy may rebound faster than forecast six months ago. The euro climbed to a seven-week high against the dollar after Deutsche Bank AG said second-quarter profit rose 68 percent, beating analysts’ estimates…
The Dollar Index, which the ICE uses to track the dollar against currencies including the yen, pound and Swedish krona, fell as much as 0.4 percent to 78.315, the lowest level since Dec. 18, and was at 78.509 at 7:30 a.m. in New York, compared with 78.626 yesterday. The euro advanced 0.2 percent to $1.4256 per euro, from $1.4232. The 16-nation currency traded in a range of $1.3833 to today’s high of $1.4304 in July…”
source: bloomberg.com
“The feds are spending tens of millions of stimulus dollars to repair and build toilets across the nation, in an outflow of taxpayer funds that critics have branded ‘potty pork.’
From humble sylvan outhouses to ‘historic’ restrooms, cash from the $787 billion stimulus is going to spruce up or completely replace aging toilets, government releases show.
In New Mexico alone, the feds are spending $2.8 million for toilets in national forests. “
source: nypost.com
“Divisions between the administration of Barack Obama, the Federal Reserve and key regulators came to a head on Friday as officials debated plans to overhaul the US regulatory system.
Tim Geithner, Treasury secretary, said there was ‘a lot of dumb regulation in our country’ and urged lawmakers to enact quickly the administration’s plan to reform the system, in spite of resistance from the financial industry and other regulators.
‘Every financial crisis of the last generation has sparked some effort at reform, but past attempts began too late, after the will to act had subsided,’ he told the House financial services committee, which will start drawing up legislation in September. ‘That cannot happen this time’…”
via financialtimes.com
“…Paul Krugman is a devotee of John Maynard Keynes. He’s such a hard core disciple that he was Keyensian when Keynesianism wasn’t cool: the period between the 1970s stagflation, which seemed to disprove Keynesian doctrine, and now, when it is groundlessly renascent due to our society’s stunted memory span. He himself proudly admits his devotion to Keynes. He has written such headlines as ‘The Greatness of Keynes” and “Why Aren’t We All Keynesians Yet?’ But what does it mean to be keen on Keynes? What diagnosis does Krugman’s Keynesian economics have for the economic crisis, and what remedies does he prescribe…
…Paul Krugman wants to be our savior. Like a savior, he would perform a miracle for us: that of turning consumption into wealth. But who would accept a messiah with such a John the Baptist as John Maynard Keynes, who proclaimed that credit expansion could perform the ‘miracle … of turning a stone into bread’? In any case, Krugman is a curious kind of savior: one more interested in exercising his brilliance than in actually helping people…”
via mises.org
“The federal government has devoted $4.7 trillion to help the financial sector through its crisis, a level of assistance equal to about one-third of the overall U.S. economy, a watchdog report said Monday. Under the worst of circumstances, the report said, the government’s maximum exposure could total nearly $24 trillion, or $80,000 for every American.
The figures are part of a tough new quarterly report to Congress from special inspector general Neil Barofsky, who accuses the Treasury Department of repeatedly failing to adopt recommendations aimed at making one component of the government financial rescue effort more accountable and transparent. The $4.7 trillion commitment to the industry takes into account about 50 initiatives and programs set up since 2007 by the Bush and Obama administrations as well as by the Federal Reserve. Barofsky oversees one of the initiatives — the $700 billion Troubled Asset Relief Program. Much of the government assistance is backed by collateral and Barofsky’s $23.7 trillion estimate represents the gross, not net, exposure that the government could face…”
via the associated press
“…CIT needs time to strike deals with bondholders to reduce debt after the U.S. declined to give the firm a second bailout. CIT, which reported $3 billion of losses in the last eight quarters, received a $2.33 billion rescue in December after converting to a bank holding company to be eligible to sell bonds backed by the Federal Deposit Insurance Corp.
We still think it is a losing effort in the intermediate term although some bondholders may end up better than others with this structure,” said David Hendler, an analyst at CreditSights Inc. in New York. “The wholesale model is dead and creating a branch deposit system from scratch is too expensive for CIT and takes too long to build to help any time soon…’”
via bloomberg.com
“The Internal Revenue Service has stepped up scrutiny of offshore accounts and foreign income, an enforcement campaign that could sweep up tens of thousands of taxpayers.
The push to recover some of the billions of dollars lost each year to offshore tax evasion goes beyond the government’s high-profile effort to force Swiss bank UBS AG to release the names of 52,000 American account holders in order to nab tax evaders.
The IRS is using a once-obscure tax form called the Foreign Bank…”
via wsj.com
“…Error One was to permit a bubble in the 1980s. Error Two was to wait a decade before opting for monetary “shock and awe” through quantitative easing.
The US Federal Reserve has moved faster but already seems to think the job is done. “Quantitative tightening” has begun. Its balance sheet has contracted by almost $200bn (£122bn) from the peak. The M2 money supply has stagnated since January. The Fed is talking of “exit strategies”.
Is this a replay of mid-2008 when the Fed lost its nerve, bristling over criticism that it had cut rates too low (then 2pc)? Remember what happened. Fed hawks in Dallas, St Louis, and Atlanta talked of rate rises. That had consequences. Markets tightened in anticipation, and arguably triggered the collapse of Lehman Brothers, AIG, Fannie and Freddie that Autumn.
The Fed’s doctrine – New Keynesian Synthesis – has let it down time and again in this long saga, and there is scant evidence that Fed officials recognise the fact. As for the European Central Bank, it has let private loan growth contract this summer…”
via telegraph.co.uk
“1. It would reward failure. Like the largest banks that have been bailed out, the Fed was a co-author of the destruction. During the past twenty-five years, it failed to protect the country against reckless banking and finance adventures. It also failed in its most basic function–moderating the expansion of credit to keep it in balance with economic growth. The Fed instead allowed, even encouraged, the explosion of debt and inflation of financial assets that have now collapsed. The central bank was derelict in enforcing regulations and led cheers for dismantling them. Above all, the Fed did not see this disaster coming, or so it claims. It certainly did nothing to warn people…”
via globaleconomicanalysis.blogspot.com