Australian Politics Forum - What's the Real truth?

perceptions_now

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Re: What's the Real truth?
Reply #165 - Jul 12^th, 2011 at 8:54am

Wall St dives on Italy worries

US stocks slumped this morning, as another round of anxiety over Europe's debt crisis spurred investors to flee risky assets like stocks.

The Dow Jones Industrial Average dropped 151.44 points, or 1.20 per cent, to 12,505.76, as investors rushed for the US dollar, gold and other perceived safe havens. The Standard & Poor's 500-stock index slid 24.31 points, or 1.81 per cent, to 1319.49, with all sectors in the red. The Nasdaq Composite tumbled 57.19 points, or 2.00 per cent, to 2802.62.

Euro-zone anxieties widened beyond Greece as a panic over Italy's government debt and banking sector yesterday triggered a 4 per cent drop in Italy's FTSE MIB stock index. Spain was also in focus after the new leader of the Castilla La Mancha region said the area's government has a budget deficit more than twice as large as previously thought. Italian and Spanish yields jumped to euro-era records.

The latest euro-zone developments spurred worries the continent's debt crisis is spiralling out of control, threatening to create a wider emergency for global markets. The sell-off overshadowed investors' hopes for US corporate earnings season, which kicked off unofficially today.

"Sentiment has shifted back to 'glass is half empty,'" said Mark Luschini, chief investment strategist at Janney Montgomery Scott. The pessimism started with a weak reading on US employment Friday, Mr Luschini said. It set the stage for a more dramatic sell-off today with signs of worsening in Europe's debt crisis.

"The concern is whether we are getting another financial crisis relating to sovereign debt," said Alan Gayle, chief investment strategist for RidgeWorth Investments.

Link -
http://www.theaustralian.com.au/business/markets/wall-st-dives-on-europe-worries...
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The truth is, this is what spooked the Australian share markets yesterday, not the Carbon Tax!

Or, at least, this and a mixture of the other Global concerns I have written about.

Btw, the US$ index spiked nearly a full cent yesterday, in the usual "flight to quality", because of renewed jitters about Italy and the other European Piigs, whilst the Euro dropped to 1.4067 against the US$, after closing last Friday at 1.4264.

However, the sick joke is that the US Economy, Debt situation & Currency, is actually worse than most of the European Piigs!
Go figure?

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perceptions_now

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Re: What's the Real truth?
Reply #166 - Jul 12^th, 2011 at 11:18am

Want to avoid another Depression? Try understanding the first one.

What excuse do we have when we follow people who, guided by a different economic faith, see the past as they want it to have been, not as it was? Today, under the influence of leaders blinded to facts by certain faith, we are careening toward a repetition of mistakes that led to catastrophe.

A CNN poll conducted in June found that almost half of Americans now think that another Great Depression is “very likely” or “somewhat likely” to occur within the next 12months.

One sensible response is to point out that it is also “very likely” that most of those who stated this view have little conception of what the Great Depression actually was. “Depression” has come to be a term that gets thrown around whenever anyone wants to assert that things are really bad.

And yet, there is a genuine danger that the already weak economy could turn into a second coming of the hard times of the 1930s. The focus of many politicians today on cutting spending and avoiding tax increases on the wealthy is based on a misunderstanding of what led to and extended the Great Depression — and it is setting us up for a new collapse.

Most people realize that a failure to raise the debt ceiling could be catastrophic. But the drastic cuts in federal spending that some Republicans are demanding in exchange for an increase in the debt ceiling would be a repeat of the mistakes that prevented a full recovery in the 1930s and then caused a secondary collapse in 1937. Enacting these cuts is the most likely scenario in which the current recession could become a new depression.

With the economy in a precarious position, slashing spending, concentrating ever more wealth and income at the top, and blocking effective regulation is a prescription for disaster.

Conservatives appear to be united behind a set of beliefs that are dangerously wrong. Theirs is a faith-based economics that contrasts with fact-based economics; their god is named the Market. Their economics is as immune to facts as its opposite, Marxism. Call it Marketism. A devout Marketist believes that the Market is always right and any government intervention is, well, sinful.

Link -
http://www.washingtonpost.com/opinions/want-to-avoid-another-depression-try-unde...
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In fact, Debt is both a symptom & an effect, with self re-inforcing feedback loops, much like the related problems of CO2, GHG's & Climate Change.

However, the real primary causes of the current & future Economic malaise are -
1) Short term populist Politics (from both major party's)
2) Demographics (a currently Ageing Population, which is set to go into actual Decline, within 20-30 years - Globally)
3) Peak Energy (Energy scarcity & related Substantial Price rises)
4) Climate Change & related issues.

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progressiveslol Gold Member Offline Australian Politics Posts: 17029	Re: What's the Real truth? Reply #167 - Jul 12^th, 2011 at 11:29pm Bolt and Lindzen
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progressiveslol Gold Member Offline Australian Politics Posts: 17029	Re: What's the Real truth? Reply #168 - Jul 12^th, 2011 at 11:47pm Professor Richard Lindzen on global warming science http://trainradio.blogspot.com/2011/07/professor-richard-lindzen-on-global.html
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perceptions_now

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Re: What's the Real truth?
Reply #169 - Jul 14^th, 2011 at 11:25am

Moody's Puts US's Aaa Rating On Watch For Possible Downgrade

Moody's Investors Service put its Aaa rating on the U.S. government's bond rating on watch for possible downgrade, citing the "rising possibility that the statutory debt limit will not be raised on a timely basis," which would lead to a default on U.S. Treasury debt obligations.

The ratings agency said in conjunction with Wednesday's action, Moody's placed on review for downgrade its ratings on financial institutions directly linked to the U.S. government, including Fannie Mae (FNMA) and Freddie Mac (FMCC).

Negotiations in Washington have continued as government leaders seek to ensure the country's debt ceiling is increased before an Aug. 2 deadline. Meetings appear to have ground to halt in recent days amid partisan bickering between Democrats and Republicans about how to cobble together a deal that both sides can live with.

Moody's on Wednesday said the ratings action was prompted by the possibility the debt limit will not be raised in time to prevent a missed payment of interest or principal on outstanding bonds and notes. As such, Moody's wrote there is "a small but rising risk of a short-lived default."

Moody's said an actual default, regardless of duration, would fundamentally alter the agency's assessment of the timeliness of future payments, and that the Aaa rating would likely no longer be appropriate. However, because that type of default would likely be short-lived, the rating would most likely be downgraded to somewhere in the Aa range, Moody's said.

If the debt limit is raised again and a default is avoided, the Aaa rating would likely be confirmed. Moody's did note the outlook assigned at that time to the government bond rating would very likely be changed to negative at the conclusion of the review unless "substantial and credible agreement is achieved on a budget that includes long-term deficit reduction."

The warning for a possible downgrade comes after Standard & Poor's Ratings Services in April cut its outlook on U.S. government debt to negative from stable for the first time in history, citing ongoing concerns over the long-term fiscal health of the nation.

Link -
http://online.wsj.com/article/BT-CO-20110713-714624.html
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There are games, within games, with the US actually already in the similar territory to Japan, the UK & the other Piigs of Europe, IF NOT WORSE!

The fact that they (the US) have not been downgraded, has more to do with them (the US) still being THE major influence on the Global Economy and that the Ratings Agencies are based in America!

It is likely there are still many more twists & turns, in this modern epic, but the trend is clear and by the end of 2012, the future of the Global Economy should be clear, to almost all!

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Andrei.Hicks Gold Member Offline Australian Politics Posts: 23818 Carlsbad, CA Gender:	Re: What's the Real truth? Reply #170 - Jul 14^th, 2011 at 11:32am Piigs? Portugal, Ireland, Greece, Spain. Who is your other 'i'?
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perceptions_now Gold Member Offline Australian Politics Posts: 11694 Perth WA Gender:	Re: What's the Real truth? Reply #171 - Jul 14^th, 2011 at 11:36am Andrei.Hicks wrote on Jul 14^th, 2011 at 11:32am: Piigs? Portugal, Ireland, Greece, Spain. Who is your other 'i'? These Piigs have 2 eyes - Portugal Ireland & Italy Greece Spain But there's also a little of U in these Piigs, which is the - UK
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Andrei.Hicks

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Re: What's the Real truth?
Reply #172 - Jul 14^th, 2011 at 11:39am

Italy haven't threatened to default on debt or require an EU Rescue Package as far as I know.

In regards to the UK, we are outside the Eurozone so able to set the interest rates at lower than the Euro to garner liquidity.
Plus there are measures being put in place by Cameron - which I agree with - to curtail public sector overspending, reduce down pension liability and to pay back some of the debt that built up as a result of a decade of reckless Labour rule.

This is principally why I voted for him.

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Anyone who lives within their means suffers from a lack of imagination - Oscar Wilde

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Equitist

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Re: What's the Real truth?
Reply #173 - Jul 14^th, 2011 at 11:47am

Sooner or later, the Govts of the world will have to admit that under-taxing and under-regulation of the elite and/or incorporated are at the root of the multiple sub-GFCs...

The only way to overcome the almighty mess that the world is in, is to dramatically-reverse the trends of polarisation of income, wealth, opportunity, power (including control over inter/national markets, finite resources and essential public utilities, services and infrastructure) and debt...

I, for one, hope that the world's pollies wake up to themselves, before they allow the uber-wealthy to buy-up sovereign utilities and infrastructure, with the very same ill-gotten gains that led to the current crises of unbridled capitalism...

Sad

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« Last Edit: Jul 14^th, 2011 at 11:52am by Equitist »

Lamenting the shift in the Australian psyche, away from the egalitarian ideal of the fair-go - and the rise of short-sighted pollies, who worship the 'Growth Fairy' and seek to divide and conquer!

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perceptions_now

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Re: What's the Real truth?
Reply #174 - Jul 14^th, 2011 at 12:58pm

Andrei.Hicks wrote on Jul 14^th, 2011 at 11:39am:

Italy haven't threatened to default on debt or require an EU Rescue Package as far as I know.

In regards to the UK, we are outside the Eurozone so able to set the interest rates at lower than the Euro to garner liquidity.
Plus there are measures being put in place by Cameron - which I agree with - to curtail public sector overspending, reduce down pension liability and to pay back some of the debt that built up as a result of a decade of reckless Labour rule.

This is principally why I voted for him.

With Debt at 120% of GDP, Italy doesn't have to threaten anything, that size Debt will be sufficient to push it over the edge, even if they don't jump first.

Won't make any difference!

The Austerity program introduced by the UK Conservatives will only serve to exacerbate the Economic Decline, as Declining disposable income & declining Public confidence, results in lower Consumption.

That plus higher Energy Costs, which will pervade most Products & Services and already high Debt levels, plus the collapse & the US & Europes Piigs, will ensure that the UK will not only not recover, it is also destined for a loonngg Economic Downturn, as will most other countries!

And, I'm sure that promising "tough Economic policies that worked in the past", is also likely to get Abbott-a-bad elected in Australia and probable get the Republicans up in the USA.

However, this is a completely different paradigm and accross the board AUS-TERITY IS SIMPLY THE WRONG THING, AT THE WRONG TIME, IT WILL MAKE MATTERS WORSE!

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perceptions_now

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Re: What's the Real truth?
Reply #175 - Jul 14^th, 2011 at 1:07pm

Equitist wrote on Jul 14^th, 2011 at 11:47am:

Sooner or later, the Govts of the world will have to admit that under-taxing and under-regulation of the elite and/or incorporated are at the root of the multiple sub-GFCs ...

The only way to overcome the almighty mess that the world is in, is to dramatically-reverse the trends of polarisation of income, wealth, opportunity, power (including control over inter/national markets, finite resources and essential public utilities, services and infrastructure) and debt...

I, for one, hope that the world's pollies wake up to themselves, before they allow the uber-wealthy to buy-up sovereign utilities and infrastructure, with the very same ill-gotten gains that led to the current crises of unbridled capitalism...

Sad

Well, it certainly has not & will not help!

The old Reaganism of wealth filtering down, was never going to happen & never will.

All that's happened, is that greed ensured that Resources were used too quickly and that proper transition plans were never drawn up, let alone put into action, in terms of Resources (in particular Energy) & Population levels/Ageing.

Regrettably, I think we are in this mess, for the long haul, unless there is a cheap & readily available liquid Energy source, which has been extremely well hidden, but is NOW ready to replace Oil.

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perceptions_now

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Re: What's the Real truth?
Reply #176 - Jul 14^th, 2011 at 6:29pm

All Ords Chart - Last 5 years

http://au.finance.yahoo.com/echarts?s=^AORD#symbol=^aord;range=5y;compare=;indic...

The All Ords Peaked at 6,760 in October 2007!

Since then, it has nudged up to just over 5,000 on 3 ocassions, in April 2010, in February 2011 and in April 2011.

Can it be that all the stockmarket woes are co-incidental with Labor coming to power in November 2007 or is it all their fault?

The truth is, all of the above & more.

Labor has certainly stuffed up, in a few areas, but Labor has actually maintained a reasonable Economic balance, since it came to power, in what can only be described as astonishing times.
Did Labor lie, you betcha!
Did Kevy lie, you betcha!
Did Gillard lie, you betcha!
Did Honest John lie, you betcha!
Does Abbott-a-bad lie, you betcha!
That's what Politicians have been brought up to do and it's about time it stopped!

That said, there is very little chance that the All Ords will ever see its Peak of 6,760 again, at least in my lifetime.

In the interim, both Labor & Liberal will be punsihed at a series of elections, because the Public will want someone to blame and lets face it, the Pollies are a good target and deserve whats coming!

Good luck & watch the Debt!

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progressiveslol Gold Member Offline Australian Politics Posts: 17029	Re: What's the Real truth? Reply #177 - Jul 14^th, 2011 at 9:38pm Underwater volcanoes heating Antarctic waters http://www.antarctica.ac.uk/press/press_releases/press_release.php?id=1541
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perceptions_now

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Re: What's the Real truth?
Reply #178 - Jul 15^th, 2011 at 8:25pm

IMF Says US Budget Requires 35% Spending Cuts and 35% Tax Increases

President Obama told the American people we have to "Eat our Peas" as encouragement for the nation to make the painful decisions to address our out-of-control federal deficits. To understand how many peas we would have to eat; a recent IMF report: "Who Will Pay and How?" determined that under a moderate growth "baseline scenario, a full elimination of the fiscal and generational imbalances would require all taxes to go up and all transfers to be cut immediately and permanently by 35 percent."

Most Americans didn't seem to mind if nobody's taxes got raised or benefits got cut, but with Moody's credit rating agency's announcement that the United States of America is under review for a solvency downgrade, our nation is headed for a crisis and somebody needs to start eating their peas!

Link -
http://www.huffingtonpost.com/chriss-street/imf-says-us-budget-requir_b_897952.h...
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Yes, that right, the IMF says the USA needs a permanent 35% increase in Taxes AND a 35% reduction in Expenditure!

In the mean time, in Australia, there is talk of "hell freezing over", if a new tax of $10 P/week comes into being?

Is there something wrong with the USA? You betcha!

Is there something wrong with Australia? You bethca!

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progressiveslol

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Re: What's the Real truth?
Reply #179 - Jul 15^th, 2011 at 9:24pm

perceptions_now wrote on Jul 15^th, 2011 at 8:25pm:

IMF Says US Budget Requires 35% Spending Cuts and 35% Tax Increases

President Obama told the American people we have to "Eat our Peas" as encouragement for the nation to make the painful decisions to address our out-of-control federal deficits. To understand how many peas we would have to eat; a recent IMF report: "Who Will Pay and How?" determined that under a moderate growth "baseline scenario, a full elimination of the fiscal and generational imbalances would require all taxes to go up and all transfers to be cut immediately and permanently by 35 percent."

Most Americans didn't seem to mind if nobody's taxes got raised or benefits got cut, but with Moody's credit rating agency's announcement that the United States of America is under review for a solvency downgrade, our nation is headed for a crisis and somebody needs to start eating their peas!

Link -
http://www.huffingtonpost.com/chriss-street/imf-says-us-budget-requir_b_897952.h...
==========================
Yes, that right, the IMF says the USA needs a permanent 35% increase in Taxes AND a 35% reduction in Expenditure!

In the mean time, in Australia, there is talk of "hell freezing over", if a new tax of $10 P/week comes into being?

Is there something wrong with the USA? You betcha!

Is there something wrong with Australia? You bethca!

Only thing wrong with the US atm is social justice nuts a plenty.

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