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August 08, 2011

Comments

Walter

A "primary budget surplus" is the same as a budget deficit of "3.9 percent of GDP this year"?

Government accounting is fun.

Comanche Voter

Look I'll just go with "Krugman is mad" as in crazy like a loon.

Ignatz

--A "primary budget surplus" is the same as a budget deficit of "3.9 percent of GDP this year"?--

Heh. A primary budget excludes debt servicing and a surplus of which is pretty irrelevant if all spending combined results in increasing debt levels each year.
You know, kind of like the mythical Clinton surpluses, after which we owed more than when we started.

DebinNC

Obama is giving a statement to the press at 1:00. Hope Jane will be available to translate it as only she can.

Melinda Romanoff

Never underestimate the ability of European politicians to delude themselves.

Rick Ballard

"Government accounting is fun."

It's a prerequisite within Krugman's Calvinball School of Economics. It fits pretty well with today's market action where the 10 year yield is dropping like a rock on the basis of the S&P downgrade. I wonder if a cut to BBB would drive the yield under 2%?

Captain Hate

O/T Laura Ingraham just had somebody on, John Bennett, talking about the flash mob garbage that has been taking place. The MFM had better get their heads out of the sand and start writing about this obviously racial "hate crime" phenomenon because even libs in the Socialist Republic of Cleveland Heights have had it with them. There have been a couple of Asian deaths caused by this type of phenomenon but the MFM considers non-mooooslim Asians as undeserving of sympathetic coverage as whites.

Ranger

I wonder if a cut to BBB would drive the yield under 2%?

Well, this is a case where the logic works in the oposite direction. The risk of US Bonds is in the long term, where as the risk in the market right now it very short term. As was demonstrated repeatedly, there is more than enough cash flow to pay the bond interest. The lower the credit rating goes, the worse the market will get. So, yes cutting the rating again will just drive people into bonds right now. It is a bizaro world we have created.

narciso

That is insane, how do the present fundamentals change for those companies in the Dow

Ranger

And this kind of thing doesn't help. Obama's view of government is that if he doesn't like a law, he will just ignore it:

Waivermania hits Dept of Education

"A republic, if you can keep it."

Melinda Romanoff

Ranger, no.

IMO, the bid in Treasuries, right now, is a direct function of the continued exit of private funds from Europe, seeking a safe(r) haven. That is the overwhelming aspect wrt trading today. The stock market sell off is hedge Fund generated, at present. The cash on the sidelines is waiting to come in, but refuse to pay off the HFs in any way, shape, or form. They'll come in when those HFs have to get, which would mostly be within the last 30 mins today. At or about the same time the Mutual Funds start their selling to fill their redemption requests.

What an interesting event to have a list for!

Captain Hate

Well after being holed up in Camp David with ValJar and Wookie, El JEFe should have some fresh new economic bromides to entertain us with::rolleyes::

Ranger

Ranger, no.

IMO, the bid in Treasuries, right now, is a direct function of the continued exit of private funds from Europe, seeking a safe(r) haven.

I'll defer to your much greater knowledge and experience in these issues. Are these people bailing on Euro-bonds selling to the ECB?

El JEFe

Well after being holed up in Camp David with ValJar and Wookie, El JEFe should have some fresh new economic bromides to entertain us with::rolleyes::

Uh...as I've said, uh...let me be clear, uh...millionaires and billionaires, uh, corporate jets, uh...and, uh, my predecessor.

Also, uh...there are some who say...balanced approach, uh...and also, uh, Tea Parties.

(Waggle E.T. finger. Purse lips. Furrow brow.)

Thank you.

SWarren

From Rush:
OBAMA-GEDDON, BARACKOLYPSE NOW
Heh. I like it!

Porchlight

So how does the WH simultaneously contend that S&P's credibility is shot (math errors, don't know anything about politics, etc. - per the National Journal article) AND that it's the Tea Party's fault? Those would appear to be contradictory.

Ignatz

--Uh...as I've said, uh...let me be clear, uh...millionaires and billionaires, uh, corporate jets, uh...and, uh, my predecessor.

Also, uh...there are some who say...balanced approach, uh...and also, uh, Tea Parties.

(Waggle E.T. finger. Purse lips. Furrow brow.)

Thank you.--

And that's with TOTUS feeding him his lines.

Appalled

Porchlight:

So how does the WH simultaneously contend that S&P's credibility is shot... AND that it's the Tea Party's fault

S&P can't do math and doesn't understand politics. The tea party thinks you can only add to security of America by subtaction. Now, any little kid will tell you you can only add by addition. The addition of revenues. All it will cost is a millionaire's plane depreciation cost.

S&P -- math failures. tea Party -- math failures. All the same. All deserving the flash mob tretment of the enraged and underserved.

Obama -- the One. The only number you really need to know. (Well, you might want my 1-800 Obama '12 number, too. They can give you the donation number, which I guess you need, too)

DebinNC

The networks are interrupting the soaps for Obama's statement, which will strategically cover both S&P and the SEALs. I wouldn't be surprised if he conjured up a tear or a trembly chin and played the lonely, uber-burdened Potus card targeted at women voters.

Juiceboxer Administration D-bag

Those would appear to be contradictory.

Oh, silly racialist wingnut terrorist...

Logic is stoopid. This is the Age of Obamias. All those stoopid old people rules don't apply any more. Logic, ethics, economics, relativity - all can be bent at will in Progresso-Bizarro World!

We're smarter than you and Barack is the bestest! Now shut up and eat your peas - we're trying to work.

Oh, and it's Bush's fault.

Jim Rhoads a/k/a vnjagvet

I am boldly predicting that El Jefe's 1:00 message will be another blame shifter picking up on the Kerry Axelrod performances on yesterday's news shows. If I am right, I just wish he'd get the Schieffer treatment from some in the WH press corpse. Probably will be a "no questions" session though, or, if not, planted questions from the usual lickspittles.

Jack is Back!

"Krugman è rialzista in Italia", is the term TM was looking for but in Italian not Latin.

According to my Belgian wife, the daughter of a former International banker, professor of finance and economics and all-around savvy Europhile, Germany is preparing for a new European reality of losing the Euro. Either back to pre-existing sovereign currency or dual-level Euro - one for France, Germany, Netherlands, Austria, etc. and one for the PIIGS. I know we have all heard this or variations of it before but for some reason it is become more current and topical among the ruling classes.

cathyf

Well, to be fair, you shouldn't get to be snarky about "primary budget surplus" when you don't come even close to having one... (ouch)

narciso

One question though, who would under write
debt for the PIGS, that's subprime on a global scale.

squaredance

Well I hope the TP folks are ready fir the vilification and demonization that is coming. It will be no stop. The Left will ever admit that they have done anything wrong. They wll pull out all the stops now.

The only positive is that it the Democrats may go overboard and overdo it too early in the election cycle.

Let us hope no one gets physically hurt. The Left will have its mobs out nw, ad ut for blood.

It could it get really nasty.

Well the electorate has a chance to see matters as they really are. Will they keep a level head and put blame where the blame belongs?

It s interesting to note that during all the years of non-stop brickbat throwing, GWB never once got up and did one of these shameful blame game pressers. Seems to me that that is almost all we have gotten out of Obama.

If the nation really wants to believe that a grass rots movement like the tea party is responsible for all of these problems then its deserves what it gets. It is wholly irrational.

It is amazing that we could go down this way. The culprits and all their stupidity out in the open and yet it does not matter. Just scream and scream, lie and lie, and that s enough to dodge just massive consequences.

Let us see what happens in Wisconsin this week and next. No, it is not a "national test" there, it is just a few districts, but it will indicate just how resistant people are to this torrent of lies ad abuse.

My guess is the democrats win the recall.

The TP needs to have courage and not let themselves be intimidated. They are right, after all is said and done.

Porchlight

So it sounds like he is adding in the SEALs to the statement so he won't have to take any hard questions on the downgrade. Classic. Encouraging only in that it shows he expected to (possibly) get hard questions.

MayBee

Is he taking questions?

MayBee

Is he giving a shout-out?

Porchlight

Yeah, I guess statement means no questions. Wish he would be brave for a change though.

rse

That would certainly explain Gore's profane tirade JIB. Anything that undermines the EU hurts his vision and graft machine.

Ranger-The waivers simply tell us what aspects of the ed reform package the socialists deem most critical to obtaining the requisite submission. Think of it as the BO blueprint.

And yes the repeated practice of simply ignoring Congress and implementing anyway is something to be highlighted next year. A Nose in the Air Despot ready to Rule for Four More years.

Charlie (Colorado)

That is insane, how do the present fundamentals change for those companies in the Dow

- Cost of money goes up.
- Effect of general debt crisis drives economy down.

But there's a good bit of insane here too. According to NPR yesterday, when the Israeli markets opened, the big drop was driven by small investors getting into cash, and big institutions buying fire sale stock.

If someone felt like doing a short term trade, I'd think this would be a huying opportunity.

Charlie (Colorado)

Those would appear to be contradictory.

Never stopped them before. (CF. Bush the moron who none the less used Mind Control to trick Congress into the Iraq War resolution.)

narciso

Yes, that makes a certain amount of sense, but wouldn't T bills, and associated debt
be hit first, specially if money is coming
in from overseas.

Charlie (Colorado)

Probably will be a "no questions" session though, or, if not, planted questions from the usual lickspittles.

It was announced as no questions.

rse

I like the idea in the LUN of these waivers to allow states to ignore federal law if they simply adopt Admin preferences becoming a talking point for Republican Presidential contenders.

By all means. Let's have that nation of law or men discussion.

Charlie (Colorado)

Narciso, as of 12:26EDT, Treasuries are being bought up; it would appear that a lot of people prefer AA+ T's to European anythings.

(Actually, to be fair, the S&P for short term T's stayed high; it's long term that was downgraded.)

Charlie (Colorado)

Okay, now I'm curious: did he actually call it a "Tea Party Downgrade"? Or is he leaving that to the mouthpieces?

narciso

Wow, Megyn, 'what we were talking about again'

Captain Hate

Cracks in the MessDNC foundation? http://www.newsbusters.org/blogs/noel-sheppard/2011/08/08/scarborough-tells-terminally-stupid-ideologues-stop-using-tea-party-p

Porchlight

Statement delayed until 1:30. Late again.

Captain Hate

CF. Bush the moron who none the less used Mind Control to trick Congress into the Iraq War resolution.

Hilarious that such an obvious contradiction became part of the conventional wisdom.

Porchlight

They explained the Bush thing via Rove. Bush=moron, Rove=evil genius/puppetmaster.

Captain Hate

As I said previously, that's my favorite role for Rove to play, particularly that the progs are the only ones he'd manipulating.

Captain Hate

he's

Melinda Romanoff

Ranger-

Private funds are evacuating ANY asset denominated in euros. ECB using a teaspoon to buy debt is a side show, IMO.

Thomas Collins

All Treasury maturities seem to be holding up. See LUN.

Dave (in MA)

Is he done already, or is he late again?
Fox Live stream is showing an empty podium.

huxley

It's now 1:42 EDT. Even later. Is Obama ever on time?

Thomas Collins

So I guess, using Senator Kerry's logic, we should call this the day of the Tea Party Upgrade of US Treasuries.

DebinNC

My guess is his NBC masters told him not to interrupt Days of Our Lives if he wanted the stupid women vote.

Jim Rhoads a/k/a vnjagvet

Great link to MSDNC, CH. It looked like Joe took Mika by surprise. She looked physically ill when she realized that he wasn't following the morning talking points. Ratner's charts supported Joe and she couldn't stand it. Delicious.

Strawman Cometh

Rush says 0 is giving his (0's) cronies more time to sell before he drops his next load.

Dave (in MA)

The DOW's gone down another 100+ points since his scheduled start time. Maybe it's an underwear change.

TCO

The vast majority of the posters here (and Tom) argued for the bailout when I said it was wrong. You could have taken your medicine then. Intead you made a financial recession become an industrial one, delayed the reckoning of bad debts, transferred obligations from banksters to innocent US public and savers. And the debt kept climbing.

Anyone want to man up and admit he was wrong?

The bailout was a nightmare politically AND economically. Not just for the immediate wealth transfer, but for the clear admission that we would not allow the free market to work. Would not allow speculators to take their losses when wrong.

Oh...and Goldman sends most of its money to support Democrats.

Just really dumb, y'all.

I. Told. You. So.

I hope you are young and strong and have no medical problems. The next few years will be hard ones.

Jim Rhoads a/k/a vnjagvet

Fox Live stream is showing an empty podium.

Yes but it could also be showing an empty suit. It's so hard to tell.

huxley

http://www.whitehouse.gov/live is at least showing an empty podium, better than the blue screen.

narciso

Meanwhile, the News Beast does the old Memory Hole treatment (h/t Patterico)

With a Louisville Slugger in the trunk of his car and a computerized phone-hacking system in his Sunset Boulevard office, Pellicano dug up dirt on his clients’ enemies and helped make those problems go away—whether it was the embittered spouse of a mogul, an inconvenient gay lover, or a nosy journalist. That is, until he allegedly hired someone to intimidate the wrong nosy journalist—Anita Busch of the Los Angeles Times—and the FBI got involved, blowing the lid off the biggest wiretapping operation this side of Watergate.

What is this word “allegedly” doing there? Let’s review: this man pled no contest to threatening Busch in October 2009:

Captain Hate

I hope he drags it out until 2 so Tammy Bruce can carry on a Mystery Science Theater 3000 version of "that dumb bastard in the White House".

SWarren

He is always late because it always takes longer to rehearse him than his handlers estimated. I can just hear them: "Has he got it yet? Sheesh, this guy is a dope"

Jim Rhoads a/k/a vnjagvet

I'll man up TCO. You were righter than I was. But I'm old and weak and have a multitude of physical problems, so I hope you are wronger about that.

Captain Hate

TCO!!!

I never doubted that you had firm economic facts behind you. I *was* worried about a liquidity problem that may have been overstated.

Anyway, on to the important stuff: Give me your Redskins prediction. I'm saying between 7-9 and 9-7.

Jack is Back!

CH,

You asked for his accomplishments back a few posts:

Strawman Cometh

Also enjoyable from today's Morning Joe. I didn't catch the setup just flipped around to it as I was drying my... anyway - paraphrase from memory:
Rendell: "They have a slaughter rule in Little League. They would have to use one in a Bachman / Obama debate."
Buchanan: "You think O'Bama would lose that badly"

TCO

Peace, Jim.

I'm getting older and weaker too. Going to lift arms and ride the road bike today though.

Eating my eggwhites and veggies and keeping the gut at bay.

Get some vitamin Sun today. That shit is still free...

NK

Thomas Collins Tea Party Upgrade-- heh I like it. One observation I have not heard before-- who's interest was S&P serving with the downgrade of Long-Term US bonds? ultimately "investors" but firstly S&P's own interests. Why S&P's? S&P refused to go along with the Soc Sec and Medicare ponzi schemes any longer, because those $62 TRILLION present net cost programs can never be paid; financially they are a complete and utter sham. Until those entitlements are made acturarily sound, Uncle Same is Madoffing buyers of long term treasury bonds, and S&P didn't want to be sued for rating a ponzi scheme AAA when the stuff hits the fan. I think Melinda points to a very salient fact-investors are bailing on the Euro, unlike the Soc sec Medicare ponzi schemes the Euro debacle is right NOW. The Euro-- as constructed 13 years ago-- is DONE. Something else will replace the German currency, but this Euro is bankrupt.

Porchlight

This is getting creepy.

Charlie (Colorado)

The vast majority of the posters here (and Tom) argued for the bailout when I said it was wrong.

And you lost on that: the bailout came through, the banking system didn't collapse, and most of the Bush end of the bailout has been paid back -- which perversely gave the appearance of Bush having more deficit, and O having less.

Just really dumb, y'all.

Yes, you are.

And an asshole besides.

Begone.

Captain Hate

That would make a great poster, JiB. I'd add "Letting Neda Die in Vain" but maybe that's just me.

Charlie (Colorado)

What is this word “allegedly” doing there? Let’s review: this man pled no contest to threatening Busch in October 2009:

A plea of "no contest" is not an admission of guilt.

MayBee

Obama sounds like he's reprimanding us using the death of the 30 this weekend.

Strawman Cometh

Porch,
Are you getting a tingle up your leg?

Charlie (Colorado)

Steve Green has a nice meme to start:

"Obama: the Part-Time President"

Porchlight

OMG, earthquakes. Roads and bridges. Didn't he give this speech last week?

PD

Is President Downgrade ever on time for anything?

DebinNC

I'm astonished at Obama offering the same-old-same-old petulant bunk after getting the networks to once again him free time. Now after that, he's tacking on loss of the SEALS as an unimportant after-thought. No change of tone between the two subjects at all.

Threadkiller

The fundamentals of this President remain strong.

Porchlight

Strawman, yes, but it's because I broke my toe a couple of weeks ago. ;)

Captain Hate

Is Biden resigning for IDing the Seals? Or being prosecuted?

Ignatz

--And you lost on that: the bailout came through, the banking system didn't collapse, and most of the Bush end of the bailout has been paid back -- which perversely gave the appearance of Bush having more deficit, and O having less.--

Isn't that the Obama doctrine? "Sure it stinks but it would have been vastly worse without our courageous maneuvers."
The idea that the consequences of the idiocy of intervening in the markets is known in full yet or is even slightly over does not seem too cogent to me.

Janet

The TP needs to have courage and not let themselves be intimidated. They are right, after all is said and done.

I hope you are including yourself, squaredance. Went & bought some Gadsden Flag patches today to put on my backpack. Lets all start wearing "Don't Tread on Me" t-shirts everywhere. Blanket America with Tea Party support.

Charlie (Colorado)

Is Biden resigning for IDing the Seals? Or being prosecuted?

See any flying pigs recently?

Captain Hate

Tammy Bruce: Urkel thinks we should have 10 As.

glenda

My perception listening to the reality of Barack Obama speaking right now...is that he is a total loser, addicted to Alinsky and Keynes and in the deepest denial ever. He will never get it, the country is so worse off because of this man, it is nauseating when he speaks to the bravery of the men and women of the armed forces who protect his butt and fly him around in his corporate jet. He has no ideas, leadership, common sense, faith nor shame. Pheh!

Porchlight

Drudge: Barackalypse Now

Captain Hate

See any flying pigs recently?

It was a rhetorical question; particularly the prosecution part with the obvious insanity defense.

MayBee

We need to extend unemployment insurance. That's his big plan.

How dismal.

MarkO

"A plea of "no contest" is not an admission of guilt."

Right. It just means one has no defense. As a legal tool it has its uses, but professing innocence is not one of them.

matt

JiB;

I am secretly hoping for a return to the D Mark. I forgot to exchange @ $500 worth when they switched to the Euro. Luckily I was very low on Francs and Lira.

The markets are acting logically. The signs of economic slowdown have been apparent for a few months now, and the whole Euro edifice is built upon funny money. What the ECB is doing right now is exchanging good Euros for bad debt.

The rush to Treasuries is simply looking for the questionably safest haven in a world of bad choices.

The RMB Yuan might be considered a safe haven except it is still not trusted. In addition, China has its own world of problems with inflation and its RE and banking bubbles.

There are few good options.

MayBee

If one pleads no contest, the media is certainly not obligated to continue to use the word "allegedly".

DebinNC

He will never get it

Or listen to anyone who does. I take comfort in that, because it ruins the "don't change horses mid-stream" meme they'll trot out next year. I can't believe people want more of what we've gotten and much worse knowing a reelected Obama would be totally unrestrained.

TCO

Football is hard to predict since they play so few games and since it is more of a team sport than baseball or basketball. For that reason, I think coaches and teams should "try to win" every year. Not mortgage the future radically...but concentrate on the now, still.

I have been following Extremeskins a fair amount, but lack much of a feel for other teams.

I'm relatively pessimistic as I think we will still have issues with the conversion to 3-4 (maybe better than last year, but still there) and offense lacks firepower other than Moss.

Anywhere from 2 to 10 wins would not be crazy talk. Split the difference and call it 6-10.

I think MS is OK, but am not really a fan per se. Think he goes a bit too much with his gut. I think Kyle has a real football mind, though.

Charlie (Colorado)

Isn't that the Obama doctrine? "Sure it stinks but it would have been vastly worse without our courageous maneuvers."

I'm trying to decide whether that's an ad hominem circumstantial or a red herring. Maybe both.

In any case, no: look back at the masses of stuff I wrote back then. Before the fact, there was a very strong reason to believe that a failure of the bank system, in particular a continued complete freeze in short-term credit and a collapse of money-markets, would lead to very extreme impacts, with the example of Argentina for comparison. (When something similar happened in Argentina, unemployment went above 25 percent and middle-class families were reduced to rag-picking to get enough money to buy food.)

I predicted before the fact that the original TARP would loosen the credit markets enough to prevent that, and would eventually more or less pay itself back.

The credit markets in fact loosened, the first tranche of the TARP did in fact largely pay itself back -- some people even argue made a small profit -- and unemployment didn't go up to 25 percent with people picking rags.

Now, compare that to Obama and the "stimulus": they predicted that without the stimulus package, unemployment might go above 8 percent. The stimulus package passed, but unemployment went to above 10 percent anyway, and they had to invent "created or saved" to explain why it actually "did work".

See the difference? TARP: Prediction, what I suggested should work was tried, result was as predicted.

Stimulus: what they suggested should work was tried, it didn't work as predicted.

MayBee

I really hated the way Obama tacked the discussion of the Seals onto the rest of his reprimand. He still sounded peeved, and it bordered on sounding like if we didn't do what Obama wants us to do, we are letting the Seals down.

Charlie (Colorado)

If one pleads no contest, the media is certainly not obligated to continue to use the word "allegedly".

I'd wonder about that: one of the lawyers might want to weigh in, but I suspect it might even be libelous.

Jim Ryan

most of the Bush end of the bailout has been paid back -- which perversely gave the appearance of Bush having more deficit, and O having less.

Since Bush's big last deficit was mostly paid back, that payback has have been an under-the-radar windfall for Zero's deficit record, right? In other words, not only was a lot of Bush's deficit later canceled but also Nancy and Zero's spending habits have really been worse than they seem in the amount that was paid back. No?

Charlie (Colorado)

Right. It just means one has no defense. As a legal tool it has its uses, but professing innocence is not one of them.

None the less, I don't think it constitutes an admission of guilt. As I say, I'd like to hear one of the lawyers on it, but my understanding from, eg, the AP style book, is that "alleged" should still be used.

Threadkiller

Bunker, if you are lurking, what was your favorite part of the speech?

Captain Hate

Hmmmm TCO; I'm sensing that your usual level of attention has been diminished slightly but significantly by the lockout. I think there's cause for optimism because it looks like Shanny has convinced The Danny that they have to blow the team up and start with younger players and a few youthful free agents. IOW, I think this was the best offseason they've had for a while and will set them up well for a big push next season.

Charlie (Colorado)

Since Bush's big last deficit was mostly paid back, that payback has have been an under-the-radar windfall for Zero's deficit record, right? In other words, not only was a lot of Bush's deficit later canceled but also Nancy and Zero's spending habits have really been worse than they seem in the amount that was paid back. No?

That's certainly the way it seems to me, Jim. Government accounting is kind of weird anyway (note that we keep comparing the debt to GDP, which is more like current revenues) but as I understand it, the TARP loans in 2008 were paid back after the inauguration and so became a part of Bush's deficit, and couteracted part of Obama's spending.

Charlie (Colorado)

All the AP seems to have is that Obama thinks S&P are a bunch of stinky poopie heads and the US really is still a AAA country.

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