"Economists are pessimists: they've predicted 8 of the last 3 depressions."
--Barry Asmus

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Thursday, June 30, 2011

World News! Now With Exploding Watermelon!

  • In a move that surprised nobody, the IMF has named Christine Lagarde - the European candidate - President.  Contender Augustin Carstens was described as "well qualified", but lacked certain key qualities[1].
  • Following yesterday's French airlift of weapons to Libyan rebels - a possible violation of a UN arms embargo and of the terms of the UN resolution currently being used to justify NATO attacks on Libya - NATO Secretary General Anders Rasmussen has said that NATO was not involved.
  • The African Union has condemned the French decision to air-drop weapons to Libyan rebels, expressing fears that the civil war could spill over into neighboring countries.
  • Police arrested six men for attempting to smuggle and sell 1.8 kg of uranium-235, the weapons- and reactor-grade isotope.  The uranium is believed to have come from Russia, and it is unknown to what level it was enriched.
United Kingdom
United States
  • Quantitative Easing 2 has officially ended today.  So far, the markets appear unconcerned.
  • The latest Wikileaks embarrassment?  Revelations that contractors for Fruit of the Loom Hanes, and Levi's obtained the close cooperation of the US Embassy to Haiti to limit the 2009 minimum wage increase for textile workers in that nation to $3 per day.  Workers in all the other sectors got an extravagant $5 per day minimum wage, still $7 per day below the cost of living for a family of three, but which was still protested by the US Embassy for failing to "take economic reality into account".
  • Firefighters are struggling to contain a wildfire in Arizona that has burned 110 square miles already, and that threatens to reach radioactive waste stored at the Los Alamos National Laboratory.  Radioactive fire - which sounds like the name of an early-80s metal band  - is a genuine possibility.
  • TDL-4, a new botnet capable of hiding in the Windows master boot record, is your new internet security nightmare.  Most security programs don't scan the master boot record.
  • The IMF has warned that the US debt burden is on an "unsustainable trajectory", and that failure to take action on the current US debt issue would not only "have significant global repercussions", but could also lead to a downgrade in the country's AAA debt rating.
  • The city of San Francisco is contemplating banning pet sales, and sales of live animals for non-human animal food, as a way to prevent animal cruelty.  Buying lobsters to boil alive will still be legal, as long as your dog doesn't get the leftovers.
[1]  Those qualities being 1) European and 2) white.

First Time Jobless Claims

As you all may remember, I was on vacation last week.  Amongst other things, this means that I did not pay attention to any form of economic data beyond the balance of my checking account.  I have no idea what the figures looked like last week.  Econoday is reporting that the seasonally adjusted level for initial claims came in at 429,000, missing expectations by 9000.  They also indicate that the US Department of Labor had to estimate results for six states due to "technology issues", so this number could be heavily revised.  And right now, the Econoday-surveyed analysts are anticipating 420,000 new initial claims,f or the week ending 6/25.
So let's pull up the Unemployment Insurance Weekly Claims Report for the week ending 6/25, and see what actually happened.
Right off the bat, the seasonally adjusted initial claims figures for last week have not been revised.  They remain at a level of 429,000.  For 6/25, the initial claims have come in at an expectations-missing 428,000.  Actual initial claims for 6/25 came in at 403,284, up 8,998 from last week.  And the total number of people claiming benefits in all programs for the week ending 6/11 came in at 7,511,613, down 30,701.

Tuesday, June 28, 2011

World News! Now Back From Vacation!

  • Philip Morris is has threatened to sue the government of Australia over a plan to ban company logos and branding on tobacco packaging.  The company states that the law violates an investment treaty between Australia and Hong Kong.
  • In "look!  Up in the sky!" news, asteroid 2011 MD passed within 7,500 miles of the surface of the Earth around 1 PM Eastern yesterday.  This put it well inside the orbit of geosynchronous satellites (which orbit at 22,236 miles) but above the International Space Station (which orbits at 220 miles).  The asteroid, which is between 29 and 98 feet wide, would have burned up in our atmosphere had it actually hit the Earth.
  • Joseph Ackerman, the CEO of Deutsche Bank, has warned that if the current economic crisis in Greece spreads to other nations in Europe, it "could be bigger than Lehman".  He also believes that a lack of transparency on who owns Greek credit default swaps has made it more difficult to take dramatic action to solve the problem.  "We don't know whether these are in the hands of only a few players, which could then end up in trouble."
  • Olli Rehn, the European Commissioner for Economic and Financial Affairs, has warned Greece that "the only way to avoid immediate default is for parliament to endorse the revised economic program.... They must be approved if the next tranche of financial assistance is to be released."  Commenting on rumors that Brussels is working on alternate options if the austerity measures are rejected, he also said "to those who speculate about other options, let me say this clearly:  there is no Plan B to avoid default."
  • Despite this, Greek public and private sector unions have joined together to launch a planned two-day strike in protest of the proposed austerity measures.
  • In "better late than never" news, Israeli troops have begun to dismantle part of the West Bank barrier.  Four years after Israel's High Court ordered the government to reroute the barrier where it cut through the Palestinian town of Bilin.
  • 15 metric tons (about 16.5 US tons) of water contaminated with low levels of radiation have leaked from a Fukushima storage tank.  TEPCO has said it is investigating the cause of the leak.
  • The rebel health minister has said that hospitals in Benghazi are running short of medical supplies, particularly drugs and surgical gloves.
  • In a move that should surprise nobody, Libya has rejected the ICC warrant for the arrest of Muammar Gaddafi, Saif al-Islam, and Abdullah al-Sanussi.  "the leader of the revolution and his son do not hold any official position in the Libyan government and therefore they have no connection to the claims of the ICC against them," stated Libya's justice minister.
  • Over 150 dissidents have met publically in a hotel in Damascus to discuss the current crisis in the country, with the meeting's organizer calling for an end to the government's crackdown on protesters and for a peaceful transition to democracy.  Surprisingly, the Syrian government's response has not been to announce that the hotel is harboring "armed terror gangs" and then machine-gun everyone in the hotel.
United States
  • Despite the collapse of talks on the subject Thursday, President Obama remains confident that Democrats and Republicans will be able to reach a compromise deal to cut the US deficit and increase its borrowing limit.  In related comments, Senator Jon Kyl told reporters that "revenues per se are not off the table.  What we have said is we will not raise taxes, we will not alter the tax code by raising rates, that kind of thing."[1]  Both sides of the debate are facing a hard deadline of August 2, when the US Treasury has said it will have run out of money to pay bills.
  • The Supreme Court is set to decide whether police need a warrant to use a GPS device to track a suspect's movements.  An appeals court has overturned the conviction and life-in-prison sentence of Antoine Jones (for conspiracy to distribute cocaine), ruling that the month long tracking of Jones' movements by GPS amounted to an unreasonable search and an invasion of privacy.  The administration has appealed, and the Supreme Court is expected to issue a ruling sometime in October.
  • Gary Foster, a former Citigroup banker, has pled not guilty to charges that he stole $19.2 million between May 2009 and December 2010.
  • The LA Dodgers have filed for bankruptcy.
[1]  No, I don't know how a US Senator is proposing to increase government revenue without raising taxes.