H.R. 5741 Slave Bill Now in Committee:

Slavery has a new name: “Mandatory Service” - Introduced July 15th 2010 by Rep. Charles Rangle (D).

(If Americans sit still for this, then they deserve to be slaves...)

Rob Dew - July 26, 2010

http://www.prisonplanet.com/h-r-5741-slave-bill-now-in-committee.html

H.R. 5741 will give the president the authority “To require all persons in the United States between the ages of 18 and 42 to perform national service, either as a member of the uniformed services or in civilian service in furtherance of the national defense and homeland security, to authorize the induction of persons in the uniformed services during wartime to meet end-strength requirements of the uniformed services, and for other purposes.”

Barely a year after introducing H.R. 1444, which was supposed to form a “Congressional Commission on Civic Service to study methods of improving and promoting volunteerism and national service, and for other purposes”, Congress has upped the ante.

Anyone between 18 and 42 will be eligible for a two year commitment of civilian or military service.

With more college graduates working for the fast food industry, a depression era unemployment rate and less people retiring; the government will have plenty of eligible able bodies to move into the slave ranks.

This echos the sentiment of President Obama who asked Congress in Febuary 2009 to send him a bipartisan bill in the spirit of national service. His Chief of Staff Rahm Emanuel outlined a similar plan in his book The Plan.

But even Emanuel aims low looking at only 18 to 25 year olds for three months of compulsory service. Under this new legislation nearly all, able bodied Americans will be sentenced to two years of forced labor.

The infrastructure is already in place for those unwilling to participate in mandatory service and now the army is looking to fill it’s ranks with Interment/Resettlement Specialists.

There are very few loopholes to opt of out national service, even CONSCIENTIOUS OBJECTORS (SEC. 109) will be forced to choose the mandatory option of A. noncombatant service (as defined by the President) or B. national civilian service. It seems the congressional commission on civic service will no longer be needed thanks to the hard work of a suspected Congressional tax cheat from New York.

The slavery bill is currently in debate in the House Committee on Armed Services chaired by Rep Ike Skelton a democrat from Missouri. Those who oppose mandatory slavery should contact Rep. Skelton. Many bills die in committee and this bill should meet the same fate.

It looks like the $SPX is getting a bit Toppy here:

Today's candlestick is a perfectly formed Doji, and that can signal one of two things...It can signal a potential reversal to the downside, or a moment of indecision in an uptrend...Yesterday it closed a fraction above the 200 Moving Average (which should be a level of Resistance along with the Resistance levels set in the same area from June 16-21), and today it closed a fraction below it...If the upper Bollinger Band was flat or pointing down, this call for a pullback would be that much easier, but since it is upticking sharply there is about ten points it can move before it hits resistance at the upper BB...The candles are well above the 5 Moving Average, and the day it closes below the 5MA is when a pullback will be a certainty...



The CCI downticked slightly today, and when it crosses back down through the +100 line is when my Sell Signal kicks in...When the candle closes below the 5MA, the CCI usually gives my Sell Signal the same day...Volume diminished on Friday and Monday even as the price moved higher, and that shows that the rally was running out of steam...Today's Volume was a bit higher than previous sessions on a day the $SPX was down...Fast Stochastics show the fast line has crossed down through the slow line, and is still Overbought with a reading of 88.90 And the MACD Histogram had a slight downtick today, but the fast and slow lines are still upticking...

Tomorrow morning at 8:30am ET the Durable Goods Orders report will be released, and this report has the potential to move the market in the pre-market and the regular sessions...

Market Consensus Before Announcement:

Durable goods orders in May declined a revised 0.6 percent after jumping 2.9 percent in April. Excluding the transportation component, however, new durable orders rebounded a revised 0.6 percent, following a 0.9 percent decrease in April. The big negative in the report was the transportation component which dropped 6.9 percent in May-tugged down by a 29.6 percent plunge in the volatile nondefense aircraft subcomponent. Advances were widespread in other components. Looking ahead, we may see some softening in the underlying trend for new orders. The new orders index in the ISM manufacturing report eased to 58.5 in June from 65.7 in May, with 50 being breakeven. But a rebound in aircraft likely will boost the headline number.

http://online.barrons.com/public/page/barrons_econoday.html

Earnings reports from these S&P 500 companies will be released tomorrow:



The $SPX will be influenced by the Durable Goods Orders report, and by all of the companies in the Index that report earnings tomorrow...There are many more companies reporting earnings tomorrow that will have an effect on how the Index moves...For a full list of all S&P 500 companies that report earnings tomorrow, click on the link below:

http://thestreet.ccbn.com/earning.asp?client=thestreet&date=20100728

Democrats Call Off Climate Bill Effort:

By Carl Hulse and David M. Herszenhorn

http://www.nytimes.com/2010/07/23/us/politics/23cong.html?ref=science&pagewanted=print

WASHINGTON — The effort to advance a major climate change bill through the Senate this summer collapsed Thursday even as President Obama signed into law another top Democratic priority — a bill to restore unemployment benefits for millions of Americans who have been out of work for six months or more.

Bowing to political reality, Senator Harry Reid, the Nevada Democrat and majority leader, said the Senate would not take up legislation intended to reduce carbon emissions blamed as a cause of climate change, but would instead pursue a more limited measure focused on responding to the oil spill in the Gulf of Mexico and tightening energy efficiency standards.

“We know where we are,” Mr. Reid told reporters after reviewing the state of energy legislation with Senate Democrats and administration officials. “We know that we don’t have the votes.”

The decision was a major disappointment to conservation groups and lawmakers who had invested months in trying to negotiate legislation. The House last year passed its own climate change bill, a proposal that has created a backlash for some politically vulnerable Democrats. The outcome was also viewed as a setback by some utility executives who had hoped that Congress would set predictable rules governing carbon pollution.

Carol M. Browner, director of the White House Office of Energy and Climate Change Policy, who appeared with Mr. Reid and Senator John Kerry, the Massachusetts Democrat who is a chief author of the climate bill, said the Obama administration was not happy but would support Mr. Reid’s decision.

“Obviously, everyone is disappointed that we do not yet have an agreement on comprehensive legislation,” she said.

Congressional and White House officials said the decision was a pragmatic move that could produce some legislation rather than bogging down the Senate over a bill that had no chance given strong opposition from most Republicans and some Democrats. They noted that the White House had acted on its own to raise fuel efficiency standards and had pushed the development of alternative fuels.

Democrats said the slimmer package would ensure that BP would pay for the cleanup of the gulf oil spill, and would promote further production of natural gas as well as the manufacturing of natural gas vehicles, especially big trucks. They said it would also tighten household energy efficiency requirements and increase financing of the Land and Water Conservation Fund.

But even the Senate’s ability to pass a bill with significant bipartisan elements before its scheduled August recess was in doubt given the intense focus on the November elections.

Separately on Thursday night the Senate rejected a House version of an emergency spending bill that also contained billions of dollars for domestic programs, including $10 billion to help states and local school districts avert teacher layoffs. Instead the Senate sent the House a version focused mainly on financing operations in Iraq and Afghanistan.

While Senate Democrats revised their energy plans, the House voted 272 to 152 to send Mr. Obama a $34 billion six-month extension of unemployment pay for Americans who had exhausted their standard 26 weeks of aid. Signing the measure hours later, Mr. Obama said it would “restore desperately needed assistance to two and a half million Americans who lost their jobs in the recession.”

The bill had been the subject of a partisan battle, with Democrats saying that the economic crisis was an emergency that justified deficit spending, while Republicans argued that the cost should not be added to the deficit.

“We want to help those who are struggling with the current economic slowdown,” said Representative Charles Boustany Jr., a Louisiana Republican. “But we also agree with the American people that new spending must be paid for.”

In the final vote, 31 Republicans joined 241 Democrats in supporting the measure. Voting against it were 142 Republicans and 10 Democrats.

Democrats called the Republican opposition shameful given the financial struggles of many families. The bill had been stalled since late May, and advanced in the Senate this week only with the arrival of a new Democratic senator to succeed the late Robert C. Byrd of West Virginia.

“It shouldn’t have been so hard,” said the House speaker, Nancy Pelosi of California.

John M. Broder contributed reporting.

The Worst Crisis Since the Great Depression is Unfolding – Slowly But Surely

July 18, 2010

http://www.munknee.com/2010/07/draft-worst-crisis-since-the-great-depression-parts-1-2/

It’s easy to lose perspective on where the global economy stands – to be confused by the daily deluge of information – so let’s look at the big-picture of where we are today. As an investor it can mean the difference between making and losing a lot of money. So let’s take a look and see where we are at and what events are unfolding - slowly but surely.

Lorimer Wilson, editor of www.FinancialArticleSummariesToday.com, provides below further reformatted and edited [..] excerpts from the Bryan Rich’s (http://www.moneyandmarkets.com) original articles* for the sake of clarity and brevity to ensure a fast and easy read. Rich goes on to say:

We have endured the sharpest fall in global economic activity since the Great Depression and one of the most threatening financial crises ever and, according to studies by the IMF, recoveries of past recessions with these dualities tend to be longer and slower than normal recoveries — typically around five years until economies sustainably resume trend growth. That means, if you mark the start of the recent crisis as late 2007, we’re less than three years in! Therefore, we should expect more bumps in the road ahead. Furthermore, history also shows us that financial crises are generally followed by sovereign debt crises, which is where we are now.

The 4 Stages of Sovereign Debt Crises:

Stage #1 - Burgeoning Deficits:

In a financial crisis government spending increases dramatically in attempts to stabilize the financial system and stimulate economic activity. Tax revenues fall, fiscal surpluses turn into deficits and economies with existing deficits keep piling it on – and that is just what is unfolding now.

The leading economies of the world have all seen their deficits shoot higher, some to record levels. In fact, the deficit spending that’s gone on in recent years can be summed up as follows: Over 40 percent of world GDP comes from countries that are running deficits in excess of 10 percent.

Stage #2 - Ballooning Debt:

When economies are contracting or even growing slowly, bringing these deficits back down to earth becomes an unenviable challenge. Governments have to make ends meet by turning to the markets. Then those burgeoned deficits turn into growing debt loads – and that is just what is unfolding now.

When debt reaches 80 percent of GDP threshold, the borrowing costs for governments starts ticking higher and so does the market scrutiny. The IMF says five of the top seven developed countries in the world will have debt levels exceeding 100 percent of GDP in the next four years.

Stage #3 - Credit Downgrades:

When deficits and debts rise and economic activity appears unlikely to curtail fiscal problems, the credit worthiness of the government falls under intense scrutiny. That’s when we see downgrades – and that is just what is unfolding now.

Greece’s sovereign debt rating has been downgraded to junk status. Spain has lost its AAA rating and the UK could lose its AAA status if its deficit isn’t addressed. Japan’s outlook has been cut to negative and rating agencies have even warned the U.S.

Stage #4 - Sovereign Debt Defaults:

This is the final and most deadly stage because downgrades only make the vicious cycle of weak economic activity and growing dependence on debt worse. When investors see more risk, they require more return [and, as such,] the borrowing costs for these troubled countries rise. Then it becomes harder to finance spending needs and harder to finance existing debt and that’s when we see defaults – and that is on the verge of unfolding.

When S&P downgraded Greece to junk status, it warned debt holders [that they] should be prepared to receive just 30 cents on the dollar… [in spite of the] $1 trillion rescue package committed by the EU and IMF. [Then there is] Spain, an economy that represents 12 percent of GDP for the euro zone, [which is] rumored to be next in line for a massive funding request.

In sum, a sovereign debt crisis has arrived – the fuel for contagion is fear – and unless governments can demonstrate they’re willing to take tough steps to reign in debt this crisis can spread quickly.

Currenncy Crises Are Likely Next:

History shows us that financial crises tend to be followed by sovereign debt crises – and that sovereign debt crises tend to lead to currency crises, i.e. a loss of confidence in countries’ currencies which is something we’ve seen very clearly in recent months with the euro. A study from MIT on historical currency crises lays their progression out as follows:

The Three Stages of a Currency Crisis:

Stage #1 - Loss of Confidence:

The number one cause of a currency crisis is when investors flee a currency because they expect it to be devalued – and when the euro zone stepped in and threatened to cough up $1 trillion dollars in an attempt to save the euro monetary union, it was a conscious decision to devalue the euro.

Stage #2 - Herding Mentality:

When it’s thought that investors are moving out of a currency, others follow. [A case in point is the euro which] currently is being shorted [moreso than ever before in history] and when the market is heavily positioned one way — and the fundamentals support it and an intentional devaluation appears underway — big institutions have to react. Put simply, they have too much to lose by getting caught the wrong way. As such, for example, Iran’s central bank has announced they will be diversifying euro exposure by trading into gold and U.S. dollars while China and the UK have shown a significant increased interest in owning U.S. dollars as opposed to euros.

Stage #3 - Contagion:

Contagion is a phenomenon in which a currency crisis in one country triggers crisis in other countries with similar weaknesses. A crisis that started in Dubai now confronts Greece, Spain, Portugal … and will likely spread to the UK, Japan and even the U.S.

Conclusion:

The day-to-day ebb and flow of economic data and news can be distracting. That’s why it’s important, especially with all that is going on, to keep the big picture in perspective. History shows us that a global recession when combined with a financial crisis tends to stifle economic activity longer than normal recessions. History also shows us that financial crises tend to lead to sovereign debt crises, which tend to lead to currency crises so, with that in mind, it’s fair to say that a V-shaped economic recovery has always been very unlikely.

We are going to see more shocks to the global economy, more challenges and more investors fleeing risky investments in favor of safe havens. [Got gold?]

Stocks rise as investors sort through mixed earnings; Apple scores but Yahoo falls short.

Seth Sutel and Bernard Condon, AP Business Writers, On Tuesday July 20, 2010, 5:04 pm

NEW YORK (AP) -- Investors are trying to get a read on the economy using earnings reports. They're finding it's not so easy.

The result Tuesday was yet another erratic day of stock trading. The Dow Jones industrial average rose 75 points after having fallen 140 in early trading in response to a series of disappointing revenue reports. Analysts were hard-pressed to come up with a reason for the turnaround. But trading was extremely light, and that tends to skew stock prices.

Analysts said some investors were getting a little more upbeat as they awaited earnings reports from Yahoo Inc. and Apple Inc. after the close. But those reports came in mixed, just like those from the many companies that have also reported second-quarter results. Apple's stock surged in after-hours trading, but Yahoo fell. Like IBM Corp., Johnson & Johnson and Goldman Sachs Inc., its revenue fell short of expectations.

Investors have been quick to sell on even a whiff of bad news. Early Tuesday, they were motivated by the reports from IBM, J&J and Goldman. Investors have been focusing on revenue rather than bottom-line earnings because of the link between companies' sales and the economy. If revenue is down because consumers aren't spending, that's a sign that the economy could remain weak.

Investors seem to have decided as Tuesday wore on that earnings didn't look quite as bad as they first thought. Analysts noted that Goldman's drop in revenue was similar to those reported by JPMorgan Chase & Co., Citigroup Inc. and Bank of America Corp. Their revenue fell not because of a weak economy, but because their customers decided to avoid the financial markets' turbulence during the spring.

Some analysts said there were technical factors involved in the market's moves.

"Investors may have been anticipating the market heading back to early July lows so when it didn't fall apart in early trading, they slowly came back in," said Michael Sheldon, chief market strategist at RDM Financial Group in Westport, Conn.

Those investors were looking at charts that track the movements of indicators including the Standard & Poor's 500. When the S&P reaches, or doesn't reach, a specific level, that can prompt investors to buy or sell.

It was hard to predict what turn trading might take Wednesday. Yahoo and Apple are considered indicators of the overall economy, but their mixed results weren't giving investors a clear-cut direction for stocks.

According to preliminary calculations, the Dow rose 75.53, or 0.7 percent, to 10,229.96. The broader Standard & Poor's 500 index rose 12.23, or 1.1 percent, to 1,083.48 and the Nasdaq composite index rose 24.26, or 1.1 percent, to 2,222.49.

Advancing stocks were ahead of losers by 4 to 1 on the NYSE, where volume came to an extremely light 1.1 biillion shares.

http://finance.yahoo.com/news/Stocks-are-higher-on-mixed-apf-1741651426.html?x=0&sec=topStories&pos=3&asset=&ccode=

Nothing Was Sacred: The Theft of the American Dream...

http://jessescrossroadscafe.blogspot.com/2010/07/phil-it-is-end-of-world-as-we-know-it.html

Posted by Jesse at 1:07 PM - July 17, 2010

America must decide what type of country it wishes to be, and then conform public and foreign policy to those ends, and not the other way around. Politicians have no right to subjugate the constitutional process of government to any foreign organization.

Secrecy, except in very select military matters, is repugnant to the health of a democratic government, and is almost always a means to conceal a fraud. Corporations are not people, and do not have the rights of individuals as such.

Banks are utilities for the rational allocation of capital created by savings, and as utilities deserve special protections. All else is speculation and gambling. In banking, simpler and more stable is better. Low cost rules, as excessive financialisation is a pernicious tax on the real economy.

Financial speculation, as opposed to entrepreneurial investment, creates little value, serving largely to transfer wealth from the many to the few, often by exploiting the weak, and corrupting the law. It does serve to identify and correct market inefficiencies, but this benefit is vastly overrated, because those are quickly eliminated. As such it should be allowed, but tightly regulated and highly taxed as a form of gambling.

When the oligarchy's enablers, hired help is the politer word, and assorted useful idiots ask, "But how then will we do this or that?" ask them back, "How did we do it twenty years ago?" Before the financial revolution and the descent into a bubble economy and a secretive and largely corrupted government with a GDP whose primary product is fraud.

Other nations, such as China, are surely acting for their own interests, and in many cases the interests of their people, much more diligently and effectively than the kleptocrats who are in power in Washington and New York these days. How then could we possibly subvert the Constitution and the welfare of the people to unelected foreign organizations? If this requires a greater reliance on self-sufficiency, then so be it. America is large enough to see to its own, as the others see to theirs.

Economics will not provide any answers in and of itself. Economics without an a priori policy and morality, without a guiding principle like the Constitution, is a heartless monster easily manipulated to say whatever one wishes it to say, if they are willing to pay enough economists to say it. Its reputation as a science is greatly exaggerated.

"Eliminating government" is a trap put forward by the plutocrats for those unable to reason except by prejudice, as they desire to exercise their power unimpeded by the rule of law. Once you knock down the protections and the safeguards in the name of reform, the wolves will turn on the public in an orgy of looting and exploitation. This is an old story, and sadly it often works.

Efficient markets hypothesis is almost as great a hoax as the benefits of globalization and 'free trade' have been to the American people as a whole. These things are promoted by the few, at the expense of the gullible many, for their own personal benefit.

Hatred, mean spiritedness, and resentment of the weak, the old, the different, is a trick played on the masses by oligarchs and would be dictators from time immemorial. They play to the darker side of the crowd. It is a trap, and the means to the demise of freedom. And these tricksters play it well, because deceit is their specialty, their stock in trade.

"First they ignore you, then they ridicule you, then they fight you, then you win." - Mohandas K. Gandhi

So it will not be easy, and it is a mistake to think that it will be. But what greater task can we set ourselves to, other than justice and freedom for ourselves and children?


It’s the End of the World As We Know It:

By Phil of Phil’s Stock World

What are 308,367,109 Americans supposed to do?



First of all, despite clamping down on immigration, our population grew by 2.6M people last year. Unfortunately, not only did we not create jobs for those 2.6M new people but we lost about 4M jobs so what are these new people going to do? Not only that, but nobody is talking about the another major job issue: People aren’t retiring! They can’t afford to because the economy is bad – that means there are even less job openings… The pimply faced kid can’t get a job delivering pizza because his grandpa’s doing it.

There are some brilliant pundits who believe cutting retirement benefits will fix our economy. How will that work exactly? Pay old people less money, don’t cover their medical care and what happens? Then they need money. If they need money, they need to work and if they need to work they increase the supply of labor, which reduces wages and leaves all 308,367,109 of us with less money. Oh sorry, not ALL 308,367,109 – just 308,337,109 – the top 30,000 (0.01%) own the business the other 308,337,109 work at and they will be raking it in because labor is roughly 1/3 of the cost of doing business in America and our great and powerful capitalists have already cut their manufacturing costs by shipping all those jobs overseas, where they pay as little as $1 a day for a human life so now, in order to increase their profits (because profits MUST be increased) they have now turned inward to see what they can shave off in America.



How does one decrease the cost of labor in America?

Well first, you have to bust the unions. Check. Then you have to create a pressing need for people to work – perhaps give them easy access to credit and then get them to go so deeply into debt that they will have to work until they die to pay them off. Check. It also helps if you push up the cost of living by manipulating commodity prices. Check. Then, take away people’s retirement savings. Check. Lower interest rates to make savings futile and interest income inadequate. Check. And finally, threaten to take away the 12% a year that people have been saving for retirement by labeling Social Security an “entitlement” program – as if it wasn’t money Americans worked their whole lives to save and gave to the government in good faith. Check.

As Allen Smith says:

“Ronald Reagan and Alan Greenspan pulled off one of the greatest frauds ever perpetrated against the American people in the history of this great nation, and the underlying scam is still alive and well, more than a quarter century later. It represents the very foundation upon which the economic malpractice that led the nation to the great economic collapse of 2008 was built. Essentially, Reagan switched the federal government from what he critically called, a “tax and spend” policy, to a “borrow and spend” policy, where the government continued its heavy spending, but used borrowed money instead of tax revenue to pay the bills. The results were catastrophic. Although it had taken the United States more than 200 years to accumulate the first $1 trillion of national debt, it took only five years under Reagan to add the second one trillion dollars to the debt. By the end of the 12 years of the Reagan-Bush administrations, the national debt had quadrupled to $4 trillion!“

Both Reagan and Greenspan saw big government as an evil, and they saw big business as a virtue. They both had despised the progressive policies of Roosevelt, Kennedy and Johnson, and they wanted to turn back the pages of time. They came up with the perfect strategy for the redistribution of income and wealth from the working class to the rich. If Reagan had campaigned for the presidency by promising big tax cuts for the rich and pledging to make up for the lost revenue by imposing substantial tax increases on the working class, he would probably not have been elected. But that is exactly what Reagan did, with the help of Alan Greenspan. Consider the following sequence of events:

1) President Reagan appointed Greenspan as chairman of the 1982 National Commission on Social Security Reform (aka The Greenspan Commission)

2) The Greenspan Commission recommended a major payroll tax hike to generate Social Security surpluses for the next 30 years, in order to build up a large reserve in the trust fund that could be drawn down during the years after Social Security began running deficits.

3) The 1983 Social Security amendments enacted hefty increases in the payroll tax in order to generate large future surpluses.

4) As soon as the first surpluses began to role in, in 1985, the money was put into the general revenue fund and spent on other government programs. None of the surplus was saved or invested in anything. The surplus Social Security revenue, that was paid by working Americans, was used to replace the lost revenue from Reagan’s big income tax cuts that went primarily to the rich.

5) In 1987, President Reagan nominated Greenspan as the successor to Paul Volcker as chairman of the Federal Reserve Board. Greenspan continued as Fed Chairman until January 31, 2006. (One can only speculate on whether the coveted Fed Chairmanship represented, at least in part, a payback for Greenspan’s role in initiating the Social Security surplus revenue.)

6) In 1990, Senator Daniel Patrick Moynihan of New York, a member of the Greenspan Commission, and one of the strongest advocates the 1983 legislation, became outraged when he learned that first Reagan, and then President George H.W. Bush used the surplus Social Security revenue to pay for other government programs instead of saving and investing it for the baby boomers. Moynihan locked horns with President Bush and proposed repealing the 1983 payroll tax hike. Moynihan’s view was that if the government could not keep its hands out of the Social Security cookie jar, the cookie jar should be emptied, so there would be no surplus Social Security revenue for the government to loot. President Bush would have no part of repealing the payroll tax hike. The “read-my-lips-no-new-taxes” president was not about to give up his huge slush fund.

The practice of using every dollar of the surplus Social Security revenue for general government spending continues to this day. The 1983 payroll tax hike has generated approximately $2.5 trillion in surplus Social Security revenue which is supposed to be in the trust fund for use in paying for the retirement benefits of the baby boomers. But the trust fund is empty! It contains no real assets. As a result, the government will soon be unable to pay full benefits without a tax increase. Money can be spent or it can be saved. But you can’t do both. Absolutely none of the $2.5 trillion was saved or invested in anything.

That is how the largest theft in the history of the world was carried out.

300M people worked and saved their whole lives to set aside $2.5Tn into a retirement system that, if it were paying a fair compounding rate of 5% interest over 40 years of labor (assuming an even $62Bn a year was contributed), would be worth $8.4Tn today – enough money to give 100M workers $84,000 each in cash!

The looting of FICA hid the massive deficits of the last 30 years in the Unified Budget. Presidents and Congresses were able to reduce taxes on the wealthiest Americans without complaint from the deficit hawks, because they benefited. The money went directly from the pockets of average Americans into the pockets of the rich.



Now that it is time to repay those special bonds in the Trust Fund, we are inundated in opinion pieces in the leading newspapers and magazines complaining about Social Security and its horrible impact on the budget. Government finances have been trashed by foolish tax cuts, unpaid wars, tax loopholes for corporations and the very wealthy, the failures of economists, the greedy search for greater returns in financial markets and the collapse of moral values in giant businesses, but Social Security is supposed to be the problem that needs fixing…

Social Security is not “broken“–the money is in the Trust Fund. But the people who manage the finances of the United States don’t want to repay the bonds held by the Trust Fund. They want to default selectively against average people, their fellow citizens, who paid their taxes expecting to be protected in their retirement. Refusing to repay the $2.54 trillion dollars in bonds held by the Social Security Trust makes the US look like Greece, just another nation unable to govern itself coherently. The people who manage US finances come from the financial elites, the best that Wall Street and enormous corporations have to offer. Selective default exposes them as charlatans. The claims of the economics profession to expertise are puffery. Their theories about the benefits of tax cuts are proven false. Their mathematical proofs about free markets collapse in the real world.



So, what is this all about? It’s about forcing 5M people a year who reach the age 65 to remain in the work-force. The top 0.01% have already taken your money, they have already put you in debt, they have already bankrupted the government as well so it has no choice but to do their bidding. Now the top 0.01% want to make even MORE profits by paying American workers even LESS money. If they raise the retirement age to 70 to “balance” Social Security – that will guarantee that another 25M people remain in the workforce (less the ones that drop dead on the job – saving the bother of paying them severance).

What’s next? Is it fair to say that children can’t work in a struggling family business? Isn’t it to everybody’s benefit that kids should be allowed to help out at the family store? That will be the next step towards turning America into a 3rd World country. The seemingly innocent concept of “letting” kids work will deprive another 5M people of paying jobs – throwing them out into the labor force as well and driving labor costs down even further.

There’s an expression that goes “give them an inch and they’ll take a yard.” The top 0.01% of this country have taken their inches and they are foreclosing on the yards and they will come for the rest of your stuff next. If you think you are “safe” from the looting of America, it is only because they haven’t gotten around to you yet. As I explained in “America is 234 Years Old Today – Is It Finished?” – the game is rigged very much like a poker tournament. The people at the top table don’t care how well you do wiping out your fellow players at the lower tables, they know they will get you eventually and your efforts to scoop up a pile of cash for yourself simply makes their job easier when they are ready to take it from you.



The average American is $634,000 in debt thanks to the efforts that Reagan and Greenspan put in motion 30 years ago and the richer you are, the more of that money is going to come out of your hide eventually and the more you lobby to make sure that the “rich” are not taxed unfairly, the less fair it will be to you because, no matter how rich you THINK you are, unless your income is measured in MILLIONS PER MONTH, you aren’t even close to the top 30,000.

No progressive tax? That means that people and corporations who make $1M PER DAY should pay no more tax than a person making $1M per year, right? Well that means that the $2.5M debt that your family of four owes will be paid by you over 2.5 years of labor while the $2.5M owed by your Billionaire competitor will be paid over a long weekend, after which he can turn his attention back to crushing your business by creating cheaper goods – maintaining profit margins by driving down local labor costs and outsourcing the rest.

It’s a new world, America, and you’d better get used to it – we were sold down the river on a slow boat to China long ago and we’re only just beginning to feel the first effects of waves that wash back to our own shores. The people who own the media don’t want CHANGE. That’s why you never hear this stuff in the MSM – things are going exactly according to plan and the old money crowd is playing a long, patient game and they already have most of the chips – the last thing they want is people questioning the system…

http://www.philstockworld.com/2010/07/17/its-the-end-of-the-world-as-we-know-it/

Beware the Technical Trap:

Commentary: Investors shouldn't be fooled by another breakout...

By Tomi Kilgore - July 15, 2010, 12:01 a.m. EDT

NEW YORK (MarketWatch) -- Being fooled twice is enough to shame any investor, but how about three, or even four times?

The current rally marks the fourth time since early May that the Dow Jones Industrial Average (DJIA 10,287, -80.22, -0.77%) has bounced more than 5%. Previous bounces have taken the Dow above key resistance levels, and yet subsequent declines have resulted in even lower lows. Essentially, the recent pattern surrounding key technical breakdowns and breakouts suggests the Dow is nearing yet another turning point.

It is easy for bulls to fall into another technical trap, since the Dow has climbed above the 50-day simple moving average, which has acted as resistance since the Dow first fell below it in early May, and is now peeking above a downward sloping line that started at the April 26 high and connects the June 21 high. But rather than embolden bulls, the apparent breakout should actually make them skeptical, especially following a six-session rally.

There have been several false breakdowns and breakouts since the correction started in late April.

The first bounce started after the Dow fell below the 200-day moving average, seen by many as a bull vs. bear market divider, for the first time in 10 months; that bounce ended the day after the Dow closed above the 50-day moving average; the next decline ended after the Dow fell below key support at the February low; another rally ended a few sessions after the Dow had broken above the 200-day moving average and traded above the 50-day in intraday trading.

The Dow started the latest rally right after hitting a new low for the year. The break below the June 8 low of 9,757 confirmed a head-and-shoulders pattern, which is a widely recognized longer-term bearish reversal pattern.

Basically, those reacting to technical breakdowns and breakouts have been fooled many times. And keep in mind that the Dow's last six-session winning streak ended on April 26, the day before the market correction began.

The current rally has extended in anticipation of a strong second-quarter earnings reporting season, or one that isn't as bad as the market seemed to be expecting earlier this month, rather than anything concrete. Economic data out of the U.S. and abroad, as well as the downgrade of Portugal's debt by Moody's Investors Service on Tuesday, indicate some of the conditions that started the market's correction--a slowing global economy and sovereign debt risk--still exist.

Even if strong second-quarter results become a reality, investors have already acted on it. The Dow faces tough resistance at the 10,400 to 10,450 level, which encompasses the 200-day moving average and the 50% retracement of the fall from the April 26 high of 11,258 to the July 5 low of 9,614. The June 21 high of 10,594 shouldn't give way without some good, concrete news on the economy. The Dow was up 175 points at 10,391 in afternoon trading.

For investors to feel safe betting on a breakout, the Dow needs to start the next bounce before it hits a new low. There should be some support at the 9,950 to 10,000 level, while drop below 9,757 would indicate another new low was coming. At least investors can then start expecting another false breakdown, and another 5%+ bounce.

Tomi Kilgore writes Taking Stock, a global column that gives insightful analysis about equity-related topics around the world. This column originally appeared on Dow Jones Newswires.

http://www.marketwatch.com/story/dont-be-fooled-by-another-breakout-2010-07-15?siteid=e2eyahoo

U.S. Stripped of AAA Credit Rating!...By China?...

http://www.zerohedge.com/article/us-stripped-aaa-credit-ratingby-china

By Dian L. Chu, Economic Forecasts & Opinions

Despite repeated warnings going back several years from Moody's, S&P et al that the U.S. could lose its top credit rating with ongoing fiscal deficits and heavy debts, the platinum-plated AAA rating of the United States seems all untouchable.

The top notch rating certainly has helped with continuing debt financing and bolstered the confidence of some government officials. Secretary Geithner, for example, said in a February interview that the U.S. government "will never" lose its credit rating, despite big budget deficits and a newly raised debt ceiling of $14.3 trillion.

Along came a Beijing-based rating agency--Dagong International Credit Rating Co. Its first order of business is to downgrade sovereign debt ratings on some major Western nations, while slamming its Western counterparts.

"The reason for the global financial crisis and debt crisis in Europe is that the current international credit rating system does not correctly reveal the debtor's repayment ability."

Dubbed as the world’s first “non-Western” sovereign credit rating agency, in its debut international report, Dagone (means Big Justice in Chinese) downshifted the US to AA with a negative outlook, while UK and France were given AA-; Belgium, Spain, Italy with A-.

It also rates debt risk of the US above China, and listed the US as one of the countries with exposure to increasing borrowing costs and default risks.

In June, the total US debt topped $13 trillion for the first time in history. The International Monetary Fund (IMF) projected that the U.S. deficit will stand at 64% of GDP this year, rising to just over 96% by 2020.

Concerned that high unemployment may force a double dip recession, the IMF just last week urged the United States to rein in its budget deficit.

Some see Dagong’s report as mere political propaganda by Beijing to counter the repeated pressure by the U.S. on its yuan policy. Nevertheless, the national debt by country chart (below) should say that Dagong's assessment is not entirely baseless, regardless of any possible hidden agenda.


Graph source: visualeconomics.com

Meanwhile, the flock to the U.S. treasury in recent months due to the European debt crisis--temporary in nature—is by no means a testament to America’s credit worthiness.

This downgrade, although might not carry much weight and influence on the bond market, does give a sobering glimpse into the unthinkable……, well, at least to Geithner.

Stocks Surge after Alcoa, CSX Report Strong Profits:

Stephen Bernard, AP Business Writer, On Tuesday July 13, 2010, 4:53 pm

NEW YORK (AP) -- The stock market got a shot of confidence and adrenaline from the start of second-quarter earnings season.

Investors were enthusiastic Tuesday about better-than-expected profits from aluminum maker Alcoa Inc. and railroad operator CSX Corp. The Dow Jones industrial average rose more than 145 points and the major indexes were up well over 1 percent.

There was more good news from Intel Corp. after the close of trading. The chip maker reported earnings and revenue that beat analysts' expectations, and it also raised its forecast for the year. Its stock shot up more than 5 percent in after-hours trading.

The companies, among the first to report second-quarter earnings, also issued upbeat forecasts for the rest of the year. That was heartening news for investors who have been concerned that the recovery was stalling, or that the economy might even fall back into recession.

"When we go back to earnings and fundamentals, companies are delivering," said Tom Karsten, senior managing partner at Karsten Financial in Fort Worth, Texas.

Alcoa's earnings reports are closely watched because its varied customer base provides a snapshot of a broad range of other industries. It is also a component of the Dow Jones industrial average. CSX also provides insight into economic activity because it ships a wide range of products.

Alcoa said global consumption of aluminum will grow this year by more than it had forecast just three months ago. There have been concerns that the global economic recovery will end as many European nations face mounting government debt problems and high unemployment slows growth in the U.S.

CSX, meanwhile, said it sees its the economy's upward momentum continuing this year.

Intel's results are considered a good gauge of the health of the economy since its sales are driven by consumers and businesses buying computers.

Frank Ingarra, co-portfolio manager of Hennessy Funds in Stamford, Conn., said Alcoa and CSX's results lifted the market because they hit on the two themes that traders are looking for in earnings: revenue growth and optimistic outlooks.

"That's why the earnings were so good," Ingarra said. "You saw that top-line growth and good guidance."

During the recession, companies that made money often did so by cutting costs rather than bringing in sales. So sales growth is a sign that business is indeed picking up.

The Commerce Department reported Tuesday that the U.S. trade deficit increased to its widest level in 18 months as an increase in exports was outpaced by rising imports. A jump in both imports and exports is a sign that the economy is growing.

Earnings will likely continue to dictate trading over the next few weeks as hundreds of companies release results.

According to preliminary calculations, the Dow rose 146.75, or 1.4 percent, to 10,363.02. The Standard & Poor's 500 index rose 16.59, or 1.5 percent, to 1,095.34, while the Nasdaq composite index rose 43.67, or 2 percent, to 2,242.03.

http://yhoo.it/bbZZat

Meredith Whitney: Prepare for a Dramatic Decline in Housing:

http://seekingalpha.com/article/213750-meredith-whitney-prepare-for-a-dramatic-decline-in-housing

Meredith Whitney is expecting big trouble in housing in the next 9 months and she thinks it could topple the banks all over again. She also elaborates on her macro outlook for the economy.

Watch the video by clicking on the link above...

Whistleblower: Relief payments get slashed if fishermen refuse to work for BP:

By Stephen C. Webster -- Tuesday, July 6th, 2010 -- 11:25 pm

Any relief payment plan established in the wake of the worst environmental accident ever was bound to have its flaws, but this goes to a whole new level of wrong.

According to Gulf resident Kindra Arnesen, who turned whistleblower and full-time activist when she saw how many people were put out of work by the spill, BP will deduct money from individual payments on claims for lost income if the claimant refuses to work in assisting the spill response.

Reading from a letter she'd received from BP, Arnesen quoted the company's line:

"BP will continue its efforts to pay legitimate claims for losses incurred due to the Deepwater Horizon incident. However, federal law clearly provides for adjustments for all income resulting from the incident, all income from alternative employment or businesses undertaken [...] and potential income from alternative employment or businesses not undertaken but reasonably available."

In other words, if you are a fisherman who was put out of work by BP and you do not elect to work in their employ, but you still file a claim for losses over the Deepwater Horizon disaster, that claim could be significantly less than the actual damages incurred.

Arnesen, a fisherman's wife and longtime Louisiana resident, has been a true pitbull of an activist since she began popping up in area media. Finally, at the beginning of June, she gained enough notoriety that CNN picked up her story. She was one of the first to raise hell over reports of fishermen getting sick, allegedly from the oil and dispersant fumes coming off the Gulf.

Her husband David is one of thousands who opted to work for BP after the oil contaminated his usual fishing routes. She believes he was one of many who were sickened by BP's toxic vapors.

BP CEO Tony Hayward tried to pass off the multiple boats full of sick fishermen as "food poisoning." The company has since discouraged use of respirators because they don't want the task to appear dangerous. However, RFK Center President Kerry Kennedy traveled to the Gulf Coast to talk to cleanup workers and found that BP's active denial of proper safety equipment was having a serious health effect.

"In all three states that I've visited, fishermen said when they went out to work on the cleanup, that if they tried to bring respirators they were told it was unnecessary equipment and would only spread hysteria," Kennedy told Fox News.

"When I went out with eleven people, we had respirators on and within half an hour, all of our eyes were burning and our throats were closing and we all had headaches," she explained.

That got Kindra mad as hell.

In an amazing display of gusto, even with the possibility that she'd endanger his income by damaging their relationship with BP, Arnesen showed up absolutely livid to a citizens emergency summit on June 19. Her speech quickly gained traction in progressive media after she claimed BP's directors were eager to cut costs and merely put on a show every time a politician swings through, ushering cleanup crews out almost as fast as they're ushered in.

Visibly disturbed by BP's concise statement on relief payments, Arnesen jeered: "They summed it up in one paragraph: billions upon billions for coastal communities. One paragraph. One paragraph? This is what they think? That we're gonna clean up their toxic shit? For the same price that we're gonna pick up shrimp? Are they loony? Have they lost their minds?"

"Am I scared? Yes," Arnesen told CNN. "Anything that ever starts, starts with one. And if I have to be the one then I have to be the one."

The team that filmed her, Project Gulf Impact, also recently landed an interview with Dr. Chris Pincetich, a marine biologist, who claimed that the U.S. Coast Guard is involved in spraying Corexit oil dispersant and that the substance has made it ashore.

http://rawstory.com/rs/2010/0706/whistleblower-bp-deducts-relief-payments-fishermen-refuse-aid-gulf-cleanup/

This video was published to YouTube by Project Gulf Impact on July 4, 2010.

Fix America? = Fix the Politicians!...

By Dylan Ratigan - July 4th, 2010, 2:00PM

http://www.ritholtz.com/blog/2010/07/fix-america-fix-the-politicians/

Today we end Fix It week on my show, although we hope to keep this recurring theme. But the largest hindrance to solutions for all of the problems we’ve discussed – be it the Deficit, Energy, Education or the Wars – goes back to one place: the current Political Process in our country.

We practically all share the same list of problems, regardless of ideology: The undue influence of moneyed interest, the focus on inane Culture Wars instead of proper governance, the low quality of our politicians coupled with their high incumbency rates, the lack of ethics, disclosure etc. The only question left is how to fix them and then, how do we muster the will?

These are the questions we will address for my entire show today – and just to get the ball rolling, here are four of my favorite solutions:

1. ONE FOR ME, ONE FOR YOU:

I don’t have to explain to anyone why we need to fix the campaign finance system. The question is how do we do it fairly. Publicly financed campaigns are one solution, but they seem to go against our very nature as Americans. After all, who wants to be forced into having their tax money going to politicians they don’t like? Meanwhile, infringing on the amounts people can donate gives an advantage to wealthy candidates. But I think there is pretty easy solution to this:

I propose that we make a law that charges 100% fee on all political spending, with the that fee going into a public campaign financing fund that given solely to candidates with low campaign coffers on a per petition signature basis. This means that if a well-moneyed candidate like Barack Obama wants to spend $740 million of campaign donations, $370 million of that can go to his campaign and the other half to public campaign fund.

Even better, if a wealthy person like Michael Bloomberg wants to spend $108 million of his fortune trying to get elected, half goes to other, less-moneyed candidates. As far as those “poorer” candidates go, the more valid petition signatures they have, the more money they should get from the fund.

In addition to curtailing the power of the dollar in elections, this would especially help new candidates take advantage of modern marvels like social networking etc. to jumpstart a serious challenge to more-moneyed opponents.

And if you don’t want your money going to candidates you don’t like, then don’t get in to the game in the first place.

2. DISCLOSE EVERYTHING TO ALL:

It is a sad state of affairs when corporations, who clearly don’t work for us, are forced to disclose more to than Politicians who do (or at least are paid by us). We need to put the legal onus on Politicians to disclose every single potential conflict of interest, be it an invite to a BBQ or getting their nephew a job with a contractor. This means that if it could in any conceivable way be considered a conflict, it’s on them to disclose it even if there is no specific rule against it. Then, if they are found being negligent of material disclosure, they need to be fired, fined and possibly jailed.

Finally, this information MUST be updated weekly into open-source searchable databases. There is no shortage of smart, patriotic Americans who can take it from there.

3. COOL YOUR HEELS FOR SEVEN YEARS:

The revolving door from Politics to corresponding positions of undue influence in the private sector has to be stopped. There needs to be a seven year cooling off period for all Politicians, staffers and regulators from working in any related industry or lobbying their former colleagues.

While this might sound draconian, ask yourself, do you really think we are getting high quality public servants with the current incentive structure? I am betting we will get much more capable public servants once we hinder their ability to get rich off of their service.

4. END THE LEFTY-RIGHTY FACADE:

As far as I can tell, at this point the major differences in the traditional Political Parties has basically become their stance on gay marriage – and even that looks pretty similar once they are in power. Both like to give away money they don’t have and are unwilling to stand up to the special interests that fund them.

Furthermore, the false choice of “Republican” or “Democrat” is keeping some of the best candidates from making it to the general election. If politicians want to align themselves into two Political Parties, that is their right. But the government shouldn’t allow them to hold separate primaries. Hopefully this recent move to open primaries in California will take off across the country.

The question now is how do we get these same complicit politicians to make the fundamental changes that we need to the system. My hope is that in the coming years, we will see more and more people deciding that they have had enough and will enter into the political spectrum or push their neighbors and friends to do so.

Also, I am waiting patiently for serious candidates in the United States to sign a legally binding contract guaranteeing that they will support initiatives like the ones outlined above. Don’t laugh, it’s already on its way across the pond.

Politicians held personally liable for breaking their promises to the voter? That’s change we all could believe in.

Follow Dylan Ratigan on Twitter: www.twitter.com/DylanRatigan

VIDEO - Fundamental & Technical Analysis of the S&P 500's Daily & Weekly Charts:

http://www.viddler.com/explore/zigzagman/videos/28/

Technical Analysis of the S&P 500's daily and weekly charts, plus a look at the important Economic and Earnings Reports due out next week...

This video is viewed best in Full-Screen Mode...Click the four arrows in the bottom right corner...Press the Escape key on your keyboard to exit back to Normal Mode...

Have a SAFE and Happy 4th of July holiday weekend...
The market will be closed on Monday in observance of the 4th...
zigzagman

Payrolls Drop by 125K as Many Census Jobs End; Unemployment Rate Falls to 9.5 Percent:

Christopher S. Rugaber, AP Economics Writer, On Friday July 2, 2010, 8:38 am

WASHINGTON (AP) -- A wave of census layoffs cut the nation's payrolls in June for the first time in six months, while private employers added a modest number of jobs. The unemployment rate fell to 9.5 percent, its lowest level in almost a year.

Employers cut 125,000 jobs last month, the most since last October, the Labor Department said Friday. The loss was driven by the end of 225,000 temporary census jobs.

Businesses added a net total of 83,000 workers, an improvement from May. But that's also below March and April totals. The nation has 7.9 million fewer private payroll jobs than it did when the recession began.

Analysts expected private payrolls to rise by about 110,000, according to Thomson Reuters. The report indicates that businesses are still reluctant to hire as the economy slowly recovers form the worst recession since the 1930s.

The unemployment rate fell as 652,000 people gave up on their job searches and left the labor force. People who are no longer looking for work aren't counted as unemployed.

All told, 14.6 million people were looking for work in June.

Counting those who have given up their job searches and those who are working part time but would prefer full-time work, the underemployment rate edged down to 16.5 percent from 16.6 percent in May.

http://finance.yahoo.com/news/Payrolls-drop-by-125K-jobless-apf-711965434.html;_ylt=AuA562cud9WdSKyJrNxk3Xa7YWsA;_ylu=X3oDMTE1OG1nMTA5BHBvcwMyBHNlYwN0b3BTdG9yaWVzBHNsawNqdW5lcGF5cm9sbHM-?x=0&sec=topStories&pos=main&asset=&ccode=

CYCC - Cyclacel Pharmaceuticals - Announces FDA Orphan Drug Designation for Sapacitabine in Both AML and MDS:

Press Release Source: Cyclacel Pharmaceuticals, Inc. On Thursday July 1, 2010, 7:00 am EDT

BERKELEY HEIGHTS, N.J., July 1, 2010 (GLOBE NEWSWIRE) -- Cyclacel Pharmaceuticals, Inc. (Nasdaq:CYCC), a biopharmaceutical company developing oral therapies that target the various phases of cell cycle control for the treatment of cancer and other serious disorders, today announced that the U.S. Food and Drug Administration (FDA) has granted orphan drug designation to the company's sapacitabine (CYC682) product candidate for the treatment of both acute myeloid leukemia (AML) and myelodysplastic syndromes (MDS).

"Orphan drug designation for both AML and MDS significantly strengthens the value proposition represented by sapacitabine and enhances our opportunity to advance this promising product candidate to late stage clinical development and commercialization," said Spiro Rombotis, President and Chief Executive Officer of Cyclacel.

Sapacitabine, a cell cycle modulating nucleoside analogue, is in Phase 2 studies for the treatment of AML in the elderly, MDS and lung cancer. Cyclacel has reported Phase 2 results from ongoing studies in AML and MDS. The company plans to advance sapacitabine into pivotal Phase 3 development in 2010. During the first quarter of 2010, the company submitted a Special Protocol Assessment (SPA) request to the FDA for a randomized Phase 3 study of sapacitabine in elderly patients with AML.

Orphan drug designation entitles Cyclacel Pharmaceuticals to seven years of marketing exclusivity for sapacitabine upon regulatory approval, as well as the opportunity to apply for grant funding from the U.S. government to defray costs of clinical trial expenses, tax credits for clinical research expenses and a potential waiver of the FDA's application user fee. Orphan status is granted by the FDA to promote the development of new drug therapies for the treatment of diseases that affect fewer than 200,000 individuals in the United States.

http://finance.yahoo.com/news/Cyclacel-Pharmaceuticals-pz-2152455345.html?x=0&.v=1

U.S. Consumer Confidence Plummets On Job Worries:

By Ruth Mantell, MarketWatch - June 29, 2010, 11:12 a.m. EDT

WASHINGTON (MarketWatch) -- U.S. consumers are increasingly worried about jobs and the economy, the Conference Board said Tuesday, as it reported that its consumer confidence index plummeted to 52.9 in June -- the lowest level since March -- from a downwardly revised 62.7 in May.

"Increasing uncertainty and apprehension about the future state of the economy and labor market, no doubt a result of the recent slowdown in job growth, are the primary reasons for the sharp reversal in confidence," said Lynn Franco, director of Conference Board's consumer research center. "Until the pace of job growth picks up, consumer confidence is not likely to pick up."

Earlier this month the government reported that nonfarm payrolls grew by a seasonally adjusted 431,000 in May, but most of the new jobs were temporary jobs at the U.S. Census, with very weak private-sector hiring. The government's next payrolls report is due out Friday, with economists polled by MarketWatch looking for a June contraction of 130,000.

Economists had expected a June reading for consumer confidence of 62.8. The Conference Board's prior reading for May was 63.3.

Consumers' view on the present situation and their expectations deteriorated in June, with both reaching the lowest levels since March, according to the Conference Board. Their view on the present situation fell to 25.5 in June from 29.8 in May, while the expectations barometer declined to 71.2 from 84.6.

Respondents saying current business conditions are "good" fell to 8% in June from 9.7% in May, while those saying jobs are "hard to get" rose to 44.8% from 43.9%.

Respondents saying they expect business conditions to be worse in six months rose to 14.9% in June from 11.9% in May, while the percentage of those expecting better business conditions fell to 17.2% from 22.8%. Those expecting fewer jobs rose to 20.8% from 17.8%, while those expecting more jobs fell to 16% from 20.2%.

Double dip?:

While the confidence report could fuel fears of a "double-dip" recession undercutting U.S. gross domestic product, analysts at RDQ Economics said such worries may be misplaced.

"Confidence has double-dipped in the last two recoveries (in early 1992 and early 2003) without the economy falling back into recession and the June pullback in confidence is far less severe than either of those two episodes," according to an RDQ research note. "Furthermore, we think that the response to the oil leak in the Gulf of Mexico is depressing confidence."

Meanwhile, analysts at Barclays Capital Research said the confidence report contains volatility, and they expect a positive overall trend in confidence as the job market expands in the new few months.

"Despite the drop in today's report, the headline confidence index remains substantially higher than its recent trough," according to a Barclays research note. "Furthermore, this survey is usually conducted near the time of the release of the payroll report and places more emphasis on household reaction to labor market conditions, which may explain some of the pessimism in June since the May rise in private payrolls disappointed expectations."

Buying Plans Impacted:

Consumers with plans to buy a home within six months fell to 1.9% in June - the lowest level since 1982 other than 1.7% in December, according to the Conference Board. In May 2.1% had plans to buy a home.

Those with plans to buy an automobile fell to a record low of 3.7% in June from 6% in May. The data go back to 1967.

Those with plans to buy major appliances fell to 22.9% in June from 26% in May.

"While the recession may have technically ended last summer, consumers remain skittish about job and income prospects and are refraining from consuming in a sufficient enough manner as to create substantial growth in GDP," wrote Dan Greenhaus, chief economic strategist with Miller Tabak, in a research note.

Expectations for the 12-month inflation rate fell to 5.2% in June from 5.3% in May.

Ruth Mantell is a MarketWatch reporter based in Washington

http://www.marketwatch.com/story/us-consumer-confidence-plummets-on-job-worries-2010-06-29-102500?dist=countdown

Yet Another Bailout for Reckless Savers and Investors:

Weiss Research Group - Nilus Mattive - June 29, 2010

http://www.moneyandmarkets.com/yet-another-bailout-for-reckless-savers-and-investors-39534?FIELD9=1

We all watched in horror as Washington bailed out failing financial institutions … dishonest lenders … and greedy borrowers and speculators with our tax dollars.

And as responsible savers and investors, we continue to suffer from the fallout as the Federal Reserve’s policies are keeping interest rates on traditional savings vehicles near zero.

Yet now our legislators are going to add one more little piece of insult to all this injury in their sweeping financial overhaul package by retroactively compensating thousands of depositors who lost money beyond the amounts covered by FDIC insurance.

A Quick Recap of FDIC Insurance:

Most individual bank accounts — including checking, savings, trust, certificates of deposit (CDs), etc. — are covered by the Federal Deposit Insurance Corporation up to certain limits.

Until the financial crisis hit in 2008, that limit was $100,000 for each individual account owner per financial institution. Yes, a single owner could get higher amounts covered depending on the specific types of accounts owned — but in most cases, this simple rule is the easiest and simplest way to guarantee coverage.

So if a husband and wife had a joint savings account, for example, they were typically protected up to $200,000. If a sole account owner had the same $200,000 … he would have been wise to open two $100,000 accounts at two separate banks to get full coverage.

I am probably not telling you anything you don’t already know. After all, these fairly simple rules of FDIC coverage were advertised and drilled into our collective heads about as frequently as the idea that smoking cigarettes causes cancer.

Simply put, back in 2008, nearly everyone in America — especially anyone with assets in the six figures! — should have known darn well how much of their money was covered by FDIC insurance, and how to easily get full coverage if they had more than $100,000.

But apparently, thousands of people using Indymac Bank — the California behemoth that went under in July 2008 — did NOT understand these things.

I say that because under the financial regulation overhaul now working its way through Washington, a little-known provision will retroactively insure about 8,700 depositors at Indymac Bank and five other institutions that went belly up before lawmakers increased FDIC coverage to $250,000 per account owner. All told, the cost of this bailout will be anywhere from $180 million to $200 million.

In a small Los Angeles Times article, one depositor who will get reimbursed put the bailout this way:

“It’s nothing to the U.S. government but it will help keep my wife and I slightly above poverty level for a couple more years.”

Okay, wait a minute. You had deposits in excess of $100,000 and this bailout will keep you above the “poverty level?” And at the same time, a couple hundred million is a drop in the bucket for everybody else?

This is the logic that bailouts are founded upon.

Meanwhile, in the same story, another depositor blamed everyone from a misinformed teller to bank regulators for the fact that she put $360,000 in a single account.

Never once did she acknowledge that two minutes of research on her own part would have made it completely clear that all her money wouldn’t be protected in one account.

Call me crazy, but if I was about to deposit that amount of money, I might spend a little time performing a simple web search or calling the FDIC myself.

I Wonder Why We Even Pretend to Have Rules At All:

Let’s put this in another context: Say you decide to drive your car around without collision insurance. You should know darn well that if you get into an accident you’re going to pay out of pocket, right? And you probably understand how to get collision insurance added to your policy, too. If not, you probably shouldn’t be driving in the first place!

Now, let’s say you get into an accident. Should you be allowed to call up the insurance company and add collision insurance after the fact to cover your accident?

Of course not! Heck, even if the insurance company decides to provide collision insurance to all its customers a month later, why on earth would you expect your accident to be covered?

It’s the same thing with this FDIC situation.

To be fair, some of the affected depositors are claiming paperwork wasn’t filed correctly … that joint owners weren’t added … and that other clerical errors caused some of them to miss out on coverage that they thought they had.

I don’t want to seem unsympathetic. Some of that could be true, and I really do feel bad for their losses. However, it’s still on each depositor to check that things have been done properly, isn’t it? And what about all the other people who get bailed out undeservedly?

I should also note that even before this measure, the FDIC had already reimbursed depositors $0.50 for every $1 in deposits they had above the original $100,000 coverage, too.

So in the end, emotions aside, this seems like yet another example of “he who behaves most irresponsibly and whines the loudest, wins.”

I’m left wondering why we even pretend to have rules at all, when they’re so easily bent and exceptions are so easily made.

More to the point, I’m left wondering when the rest of us — hard-working savers, yield-starved retirees, responsible borrowers, and people who perform their due diligence — will get a fair shake!

Really, the only silver lining of this financial overhaul is that the raised $250,000 FDIC coverage will probably get made permanent. But with interest rates remaining so pathetically low, that’s an awfully thin thread to celebrate.

As far as I’m concerned, you’re still far better off looking at higher-yielding alternatives that provide solid income, relative safety, and are far less subject to the rather arbitrary and unfair decisions coming out of Washington these days.

And obviously, if you do have more than $250,000 under a single social security number at a single bank … please reconsider your strategy immediately. Many banks are still going belly up, and there is absolutely no reason any of your money has to be at risk.

VIDEO - Fundamental & Technical Analysis of the S&P 500's Daily & Weekly Charts:

http://www.viddler.com/explore/zigzagman/videos/27/

Technical Analysis of the S&P 500's daily and weekly charts, plus a look at the important Economic and Earnings Reports due out next week...

This video is viewed best in Full-Screen Mode...Click the four arrows in the bottom right corner...Press the Escape key on your keyboard to exit back to Normal Mode...

Happy Trading this week...
zigzagman

Government Lowers GDP Estimate for the First Quarter 2010:

http://stockmarketchartanalyst.blogspot.com/

Economy grows by 2.7 percent in first quarter, a slower pace than previously estimated.

Christopher S. Rugaber, AP Economics Writer, On Friday June 25, 2010, 11:17 am EDT

WASHINGTON (AP) -- The government lowered its estimate of how much the economy grew in the first quarter of the year, noting that consumers spent less than it previously thought.

Gross domestic product rose by an annual rate of 2.7 percent in the January-to-March period, the Commerce Department said Friday. That was less than the 3 percent estimate for the quarter that the government released last month. It was also much slower than the 5.6 percent pace in the previous quarter.

The economy has now grown for three consecutive quarters after shrinking for four straight during the recession -- the longest contraction since World War II.

In normal times, 2.7 percent growth would be considered healthy. But it's relatively weak for a recovery after a steep recession. After the last sharp downturn in the early 1980s, GDP grew at rates of 7 percent to 9 percent for five straight quarters.

"It's what I call a halfhearted economic advance," said Stuart Hoffman, chief economist at PNC Financial Services Inc. The economy is likely to grow at a similarly modest pace for the rest of the year, he said. That may reduce joblessness, but at a slow pace. He anticipated a slight reduction, from the current rate of 9.7 percent to about 9.3 percent by the end of the year.

The European debt crisis is likely to slow world trade in the second half of the year and businesses may pull back on spending once they have rebuilt their inventories, said Paul Dales, U.S. economist with Capital Economics.

"Overall, the U.S. economy may be performing much better than those in Europe, but this is still the weakest and longest economic recovery in U.S. postwar history," Dales said.

Factories are churning out more steel, cars, appliances and other goods, but not because consumer demand is particularly strong. Instead, they are producing the goods for companies that let their stockpiles drop during the steep recession, to bring them in line with lower sales. Now those companies are restocking their warehouses as sales revive.

Once that process is complete, inventory restocking will provide less of a boost to GDP.

Another factor inhibiting growth will be a reduction in government spending. The impact of the federal stimulus program is expected to fade toward the end of the year. Economists also warn that state and local governments are likely to rein in spending and raise taxes as they struggle to close budget gaps. That was apparent in the latest GDP estimate, which showed state and local governments reducing their outlays by about 4 percent.

The department's report is the third of three estimates it makes for each quarter's GDP, the broadest measure of the nation's economic output. The first quarter's growth rate declined from earlier reports because consumers spent less than previously estimated, while the nation imported more goods from overseas.

The government updates the figures with new information that is released after the initial reports.

Still, there were signs of health. Consumers boosted their spending by 3 percent, almost double the pace of the previous quarter. That's below the previous month's estimate of a 3.5 percent increase, but is still the largest increase in three years. Businesses ratcheted up their spending on equipment and software by 11.4 percent.

Growth of roughly 3 percent is needed just to generate enough jobs to keep up with increasing population. Many economists say growth needs to reach 5 percent for a full year to lower the jobless rate, currently at 9.7 percent, by one percentage point.

In the past three quarters, growth has averaged 3.5 percent.

GDP measures the value of all goods and services produced in the United States and is considered the best measure of the country's economic health.

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Fed Strikes More Cautious Tone On Recovery, Noting Risks Overseas; Holds Rates At Record Lows:

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Jeannine Aversa, AP Economics Writer, On Wednesday June 23, 2010, 5:35 pm EDT

WASHINGTON (AP) -- The Federal Reserve struck a more cautious tone about the strength of the U.S. economic recovery, indicating Europe's debt crisis poses a risk to it.

Wrapping up a two-day meeting Wednesday, the Fed in a 9-1 decision retained its pledge to hold rates at record-low levels for an "extended period." Doing so is intended to energize the rebound.

The Fed expressed confidence that the recovery will stay intact despite threats from abroad and at home. But Chairman Ben Bernanke and his colleagues offered a slightly more reserved outlook than the last time they convened.

The Fed said the economic recovery is "proceeding." That was a bit less upbeat than the view at the April meeting when the Fed said economic activity continued to "strengthen." The Fed also said the labor market is "improving gradually."

While not mentioning Europe by name, the Fed said "financial conditions have become less supportive of economic growth ... largely reflecting developments abroad."

The fragile economic picture increases pressure on President Barack Obama and lawmakers in Washington. Near-double-digit unemployment is certain to factor into the way Americans vote in congressional midterm elections this fall. If it fails to come down after that, the jobless rate could play a significant role in the 2012 presidential election.

At the same time, the president has limited options. Congress has run into opposition on extending unemployment benefits and providing more aid to cash-strapped states. While some liberal Democrats maintain that government spending is the best way to stimulate the economy, a growing number of moderate and conservative Democrats share Republican concerns that the government's exploding budget deficits pose a greater risk.

The subtle shift in the Fed's outlook drew little reaction from stock investors. The Dow Jones industrial average was essentially flat after announcement.

The decision to keep rates at record lows boosted demand for safe-haven assets like Treasurys, sending interest rates lower. The yield on the 10-year Treasury note, a widely used benchmark for mortgages and other consumer loans, fell to 3.13 percent from 3.25 percent late Tuesday. The 10-year note hasn't closed at that level in more than a year. Rates had already fallen earlier in the day after the government said new-home sales dropped 33 percent last month.

Thomas Hoenig, president of the Federal Reserve Bank of Kansas City, for the fourth straight meeting was the sole member to dissent from the Fed's decision to retain the "extended period" pledge.

Hoenig fears keeping rates too low for too long could lead to excessive risk-taking by investors and feed new speculative bubbles in the prices of stocks, bonds and commodities.

He's also expressed concern that low rates could eventually unleash inflation. And Hoenig said he worries that keeping the "extended period" pledge will limit the Fed's stated "flexibility" to start modestly bumping up rates.

Given the risks to the recovery, the Fed left a key bank lending rate at between zero and 0.25 percent. The rate has remained at that level since December 2008.

That means rates on certain credit cards, home equity loans, some adjustable-rate mortgages and other consumer loans will remain low. Commercial banks' prime lending rate would stay at about 3.25 percent, the lowest point in decades.

Low rates serve borrowers who qualify for loans and are willing to take on more debt. But they hurt savers. Low rates are especially hard on people living on fixed incomes who are earning scant returns on their savings.

Still, if the rates spur Americans to spend more, they would help invigorate the economy. That's why the Fed maintained its pledge, in place for more than a year, to keep rates at record lows for an "extended period."

Because the fragile recovery is more vulnerable to shocks, from home and overseas, economists increasingly say the Fed probably won't start boosting rates until next year -- or possibly into 2012. That's a change from a few months ago, when economists thought the Fed would begin raising rates at the end of this year.

"Increased market volatility and uncertainty on the economic outlook may cause the Fed to delay raising rates until well into next year," said Kurt Karl, chief U.S. economist at Swiss Re.

The Fed has leeway to hold rates at record lows because inflation is essentially nonexistent. In fact, the Fed noted that the price of energy and other commodities have dropped in recent months, and that underlying inflation has "trended lower." That seems to suggest that Fed policymakers are a bit more concerned about the remote prospect of deflation, versus inflation.

T.J. Marta, a market strategist at Marta on the Markets, called the Fed's policy statement "more dovish" and reinforces the belief that the central bank won't need to start boosting rates any time soon to fend off inflationary pressures.

After suffering the worst recession since the 1930s, the economy has been growing again for nearly a year. Manufacturing activity is picking up. Businesses are spending more. And Bernanke has expressed confidence that the nation won't fall back into a "double dip" recession.

Still, the strength of the recovery could be affected by the European debt crisis, an edgy Wall Street, cautious consumers, a fragile housing market and high unemployment.

If the U.S. recovery were to flash signs of a relapse, the Fed would likely take other steps to get it back on course. The Fed has left the door open to resuming purchases of mortgage securities, a move that would drive down mortgage rates and bolster the housing market. It ended a $1.25 trillion mortgage-buying program in March.