real #unemployment 42.9%: the warren buffett economy #scprimary

As documented in Parts 1-3 (Part 1, Part 2, Part 3), the Fed has generated a $50 trillion financial bubble since Alan Greenspan took the helm in August 1987. After 27 years, honest price discovery has been destroyed, thereby reducing the nerve centers of capitalism—-the money and capital markets—-to little more than gambling casinos.

Accordingly, speculative rent-seeking in the financial arena has replaced enterprenurial innovation and supply side investment and productivity as the modus operandi of the US economy. This has resulted in a severe diminution of main street growth and a massive redistribution of windfall wealth to the tiny share of households which own most of the financial assets. Warren Buffett’s $73 billion net worth is the poster boy for this untoward state of affairs.

unemployment

The massive and systematic falsification of asset prices which lies at the heart of this deformation of capitalism is a direct and unavoidable consequence of monetary central planning. That is, the pursuit of Keynesian business cycle management and stimulus through central bank interest rate pegging and massive monetization of existing public debt and other securities—-especially since the latter has no purpose other than to artificially goose the price of bonds and lower their yields; and also via other indirect  methods of financial asset levitation such as the Greenspan/Bernanke/Yellen doctrine of wealth effects and the implicit central bank “put” which underpins the economics of buy-the-dip speculators.

As previously indicated, the Keynesian bathtub model of a closed, volumetrically driven economy is a throwback to specious theories about the inherent business cycle instabilities of market capitalism that originated during the Great Depression. These theories were wrong then, but utterly irrelevant in today’s globally open and technologically dynamic post-industrial economy.

As reviewed in Part 3, the very idea that 12 people sitting on the FOMC can adroitly manipulate an economic ether called “aggregate demand” by means of falsifying market interest rates is a bad joke when in it comes to that part of “potential GDP” comprised of goods production capacity. In today’s world of open trade and massive excess industrial capacity, the Fed can do exactly nothing to cause the domestic steel industry’s capacity utilization rate to be 90% or 65%.

It all depends upon the marginal cost of labor, capital and materials in the vastly oversized global steel market. Indeed, the only thing that the denizens of the monetary politburo can do about capacity utilization in any domestic industry is to re-read Keynes’s 1930 essay in favor of homespun goods and weep!

As I detailed in the Great Deformation, the Great Thinker actually came out for stringent protectionism and economic autarky six years before he published the General  Theory and for good and logical reasons that his contemporary followers choose to completely ignore. Namely, protectionism and autarky are an absolutely necessary correlate to state management of the business cycle and related efforts to improve upon the unguided results generated by business, labor and investors on the free market.  Indeed, Keynes took special care to make sure that his works were always translated into German, and averred that Nazi Germany was the ideal test bed for his economic remedies.

Eighty years on from Keynes’ incomprehensible ode to statist economics and thorough-going protectionism, the idea of state management of the business cycle in one country is even more preposterous. Potential labor supply is a function of the global labor cost curve and now comes in atomized form as hours, gigs, and temp agency contractual bits, not census bureau headcounts.

In fact, the Census Bureau survey takers and the BLS numbers crunchers have not the foggiest idea as to what the real world’s potential labor force computes to, and how much of it is deployed on any given day, month or quarter. Accordingly, printing money and pegging interest rates in pursuit of “full employment”, which is the essence of the Yellen version of monetary central planning, is completely nonsensical.

Likewise, the Fed’s current “soft” target of 5.2% on the U-3 unemployment rate is downright ridiculous. When in the year 2015 you have 93 million adults not in the labor force—-of which only half are retired and receiving social security benefits(OASI)—-and a U-3 computational method that counts as “employed” anyone who works only a few hour per week—-then what you have in the resulting fraction is noise, pure and simple. The U-3 unemployment rate as a proxy for full employment does not even make it as primitive grade school economics.

At the present time, there are 210 million adult Americans between the ages of 16 and 68—to take a plausible measure of the potential work force. That amounts to 420 billion potential labor hours, if we accept the convention that all adults are at least theoretically capable of holding a full-time job (2,000 hours/year) and pulling their share of society’s need for production and work effort.

By contrast, during 2014 only 240 billion hours were actually supplied to the US economy, according to the BLS estimates. Technically, therefore, there were 180 billion unemployed labor hours, meaning that the real unemployment rate was 42.9%, not 5.5%!

Yes, we have to allow for non-working wives, students, the disabled, early retirees and coupon clippers. We also have drifters, grifters, welfare cheats, bums and people between jobs, enrolled in training programs, on sabbaticals and much else.

But here’s the thing. There are dozens of reasons for 180 billion unemployed labor hours, but whether the Fed is monetizing $80 billion of public debt per month or not, and whether the money market interest rate is 10 bps or 35 bps doesn’t even make the top 25 reasons for unutilized adult labor. What actually drives our current 43% unemployment rate is global economic forces of cheap labor and new productive capacity throughout the EM and dozens of domestic policy and cultural factors that influence the decision to work or not.

To be sure, for a brief historical interval—-from roughly the New Economics of the Kennedy Administration to the 2007 eve of the housing crash and financial crisis—- the Fed did levitate the GDP and meaningfully impact the labor utilization rate. That was owing to the one-time trick of levering up the household and business sector through the inducements of cheap debt.

The Warren Buffett Economy——Why Its Days Are Numbered (Part 4)

 

#benghazi seal father on #hillary #clinton: ‘#shesascumbag’ (@shoq #shoq)

The father of slain former Navy SEAL Glen Doherty who was killed in the 2012 Benghazi, Libya terrorist attack has strong words for former Secretary of State Hillary Clinton over her handling of Benghazi.

“She’s a scumbag, in my opinion,” said Ben Doherty in an interview with NECN published to coincide with Clinton’s testimony on Thursday before the House Select Committee on Benghazi.

Benghazi Glen Doherty

Glen Doherty with his father Ben, family photo via WCVB-TV.

Well I think that she pulled all the troops out of the embassy, he had no backup. He burnt alive. She said it’s no big deal, it’s a big deal to me, he’s my son and I loved him.”

Glen Doherty’s mother and the former wife of Ben, Barbara Doherty, is one of the few Benghazi family members to speak out in support of Clinton, telling NECN:

“”They’re looking at the wrong place. If you read carefully what was going on, many people made many mistakes, which is normal in confusion. After a few days, the facts were out, and they’re really chasing the wrong person.””

“”They’re hoping to defeat her and it’s not going to work.””

The Doherty family is working to close a loophole that mandates single federal contractors carry insurance but does not pay out death benefits if the contractor has no children or spouse, reported the Boston Globe.

“As an independent contractor who was unmarried and without children, Doherty was ineligible to receive death benefits afforded to military personnel under the Defense Base Act of 1941, although he was employed by the CIA, she said.

“The family is working with Congressman Stephen F. Lynch to craft a law that would remove those barriers.

“On Jan. 26, Lynch introduced The Glen Anthony Doherty Overseas Security Personnel Fairness Act.

““It is unacceptable that the Defense Base Act requires federal workers to take out an insurance policy before they are deployed overseas and accepts the payment of insurance premiums from those workers, but fails to provide death benefits to their families or estate solely based on marital and child status,” Lynch stated on his website.”

Kristinn Taylor: Benghazi Victim’s Father on Hillary Clinton: ‘She’s a ‘Scumbag’

governor sarah #palin accomplishments #palin2016

Yes, a candidate should have a record. I challenge all potential candidates to match this. To be fair and give other candidates a fair chance, I did not include her achievements as a Council woman or Mayor, though these achievements must be duly noted by all.  Besides, I was getting tired from typing.

Here’s our Candidate’s Record…Governor Sarah Palin

You will notice she serves for the people; she prioritizes, cutting taxes, building surpluses and savings, then appropriates to programs that help education, seniors, and children with special needs!

  • 93% Historic High approval rating
  • Cut State Spending 9.5% 2007 to 2010
  • Reduced Federal Earmarks 80%
  • Invested $5 billion dollars State Savings
  • Overhauled Education Funding
  • Implemented Senior Benefits Program
  • Used her authority to Line item VETO to cut superfluous spending in 2007
  • Used her authority in 2008 to VETO 361 line items to reduce $80.3 million in proposed spending in 2009
  • Cut SPENDING more than 33% in FY 2010 from FY 2009’s Budget
  • Signed energy legislation suspending the state motor fuel tax
  • Signed legislation opposing a Federal Aviation fuel tax
  • Lowered unemployment insurance tax rates (2 years in a row)
  • Reformed State Pension program resulting in decreasing debt liabilities by 34%
  • Her fiscal policies were responsible for Credit upgrade from AA to AA+ in April 2008 (Standard and Poor)
  • Her fiscal policies were responsible for Credit upgrade from AA+ to AAA in November 2010 (Moody’s)
  • Accumulation of multiple budget reserves equal to more than 200% of the general fund budget due to Legislation like ACES
  • $12 Billion dollars in savings due to ACES and a $5 Billion dollar surplus
  • Spent less on travel expenses than her two predecessors despite having a larger family. $913 Thousand less her first two years than Murkowski did his last two years
  • She rejected a gubernatorial pay raise
  • Signed ACES, a net tax on oil profits passed in a bipartisan manner and transparency. Constituents had 17 days to read a draft of the bill before legislators discussed it
  • Record number of oil jobs in each year from 2007, when ACES was implemented, to 2009
  • Number of Oil companies filling taxes with the state doubled between 2006 and 2009 due to ACES
  • Natural resources and logging jobs increased 13.7% during Palins tenure
  • Introduced the Alaska Gasoline Inducement Act (AGIA) in March 2007. Passed the Legislature in huge bipartisan manner by a vote of 57-1 in May 2007
  • Served as Vice Chair of the National Governors Association
  • Served as the Natural Resource Committee and Chairman of the Interstate Oil & Gas Compact Commission
  • Chair, Alaska Oil and Gas Conservation Commission
  • Alaska was 2nd in job growth compared to all other states during her leadership
  • Alaska was 3rd in the nation in terms of change in the unemployment rate relative to the national average
  • Alaska saw record number of oil jobs in both 2008 and 2009.
  • Cut business license fees in half during her tenure
  • Alaska moved up from the 4th most business tax friendly state to the 3rd most business
  • friendly state during her tenure
  • Signed legislation allowing Alaska-based businesses the same opportunities as our of state businesses, within Alaska
  • Alaska’s exports grew to a record high $4 Billion in 2006, a 12.6% increase
  • Alaska’s exports for 2007 reached $3.9 Billion, the second best year for exports
  • Fought for and signed sweeping BIPARTISAN Ethics legislation which restricted lobbyists, improved disclosure laws, and improved executive and legislative branch ethics laws
  • In the face of corruption Gov. Palin took on her own party
  • Gov. Palin opened up natural gas pipeline deals to all potential parties
  • Gov. Palin DID NOT ALLOW lobbyists in her office
  • Forward funded EDUCATION to allow districts greater flexibility.
  • Supported increased vocational training and early education funding
  • Offered to PERSONALLY TALK to students considering dropping out of school
  • Opened up opportunity to Alaskan students to participate in regional medical school
  • Increased overall funding for SPECIAL NEEDS EDUCATION 175%
  • Increased funding for the Alaska Youth Challenge Academy 18.8% in her first year in office
  • Gov. Palin’s FY 2008 Capital budget included $2.5 Million for special needs housing which included $250 Thousand for SPECIAL OLYMPICS facility upgrades
  • Introduced health care TRANSPARENCY LEGISLATION to provide consumers factual information on QUALITY and COST to make better informed decisions
  • Recognized that healthcare must be MARKET AND BUSINESS driven, rather than RESTRICTED by Government
  • Proposed repeal of Certificate of Need- A layer of bureaucracy that prevents medical facility development
  • ESTABLISHED the Alaska Health Strategies Planning Council in the Office of the Governor
  • REDUCED Medicaid assessments for Seniors, those who are disabled and those who are ill by 83% of her predecessor
  • EXPANDED Alaska’s Senior benefits program even signing emergency authorization between the legislatures general and special sessions
  • Joined multi-state amicus brief authored by the state of Texas in support of the 2nd Amendment right of individual Americans to bear arms
  • Life member of the National Rifle Association
  • Chose to monitor rather than participate in national standards for education noting state and local standards and accountability are better
  • Transitioned responsibility for the quality of Alaska water resources from Federal to STATE CONTROL
  • Commander in chief of National Guard and also the Alaska State Defense Force
  • Shared STRATGIC COMMAND over the 49th Missile Defense Battalion of the Alaskan National Guard which is on permanent duty
  • Gov. Palin was briefed on highly classified military issues, Homeland Security, and Counterterrorism
  • Supports both parental notification and parental consent laws for abortion
  • Supported state constitutional amendments or legislation that would have stated abortion is not a right & made coerced abortion a crime
  • Signed the “Safe Haven” bill into law
  • Extended the Council on Domestic Violence and Sexual Assault
  • Made it Mandatory that the governor and the Board of Parole to work together to ensure any decision on clemency is based on a thorough review of the case and made in deference to victims and their families
  • Expanded Alaska Homeless Council
  • Directed multi departmental effort to improve aviation safety
  • Signed aviation, consumer protection legislation

By Wayne Mazza: Full List Governor Palin Accomplishments & Views on Issues

gov #palin featured speaker at cambridge union society

Highlights include a debate involving comedian, actor and activist Stephen Fry, American politician Sarah Palin, leader of feminist movement FEMEN Inna Shevchenko and journalist Jon Snow.

Celebrating its 200th anniversary, the Cambridge Union Society has today released its first termcard of 2015.

The major speakers confirmed so far include British comedian/presenter Stephen Fry, former vice-presidential candidate Sarah Palin, leader of the international feminist movement FEMEN Inna Shevchenko and Channel 4 News Presenter Jon Snow.

Reflecting on the varied fields of the revealed speakers, Amy Gregg, President of the Union for Lent 2015, commented: “I’m extremely pleased that we have begun our Bicentenary year with such a diverse range of prominent speakers. As ever, the Union strives to offer members the opportunity to engage with some of the world’s most significant and influential public figures.”

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Controversial American politician Sarah Palin will then speak on the 2nd of March. The first female Republican to be nominated for the Vice Presidency, during the 2008 Presidential election, Palin has more recently spent time as a political commentator for Fox News, and has starred in ‘Sarah Palin’s Alaska’, her own reality show. Her book, ‘Going Rogue’, has sold over two million copies.

On the 13th of March, journalist and Channel 4 news presenter Jon Snow will speak. A well-renowned journalist, Snow has received numerous awards for his work including five Royal Television Society Awards. Union members can expect to hear about a range of current topics in his talk – last year, Snow’s work involved a head-to-head with Russell Brand and ground reporting from the conflict in Gaza.

Other prominent speakers include composer Stephen Sondheim, who will appear via video-link, feminist author and theorist Germaine Greer and illustrator Sir Quentin Blake.

The Cambridge Student: The Union will also be celebrating its 200th anniversary with a series of bicentenary-themed events, including two debates and the Bicentenary Ball ‘A Night in History’

Cambridge Union Lent 2015 Magazine

obama the frightening disaster: US central command twitter & youtube accounts hacked by #isis

The Twitter account for U.S. Central Command has been hacked, and is carrying messages promoting the Islamic State — including one that says, “AMERICAN SOLDIERS, WE ARE COMING, WATCH YOUR BACK. ISIS.”

Another page shows what appears to be an image from a computer web cam in a military facility. An accompanying tweet says, “ISIS is already here, we are in your PCs, in each military base.”

Central Command officials say they are “aware” of the issue and are “addressing” it.

“This is bad,” one Central Command source told Fox News.

The Twitter account now carries an image identifying the page as “CyberCaliphate,” with a message that says, “I love you ISIS.”

The page has started posting screen shots of information about military commanders, including phone numbers and email addresses.

The same image at the top of the hacked Twitter page has also been emblazoned atop Central Command’s YouTube page.

Fox News:

gov #palin: “noticeable absence – man who promised in ’08 to restore america’s image…nominated for #nobelpeaceprize 2wks into this failed presidency”

After the atrocious attacks of September 11th, the world unified behind our great nation, stiffened its collective spine, and took a stand against Islamic terrorism. Following last week’s brutal attacks in Paris by Muslims with the same evil terroristic beliefs as the 9/11 savages, today the world came together again against the death cult that is the radical Islamic “faith.” The largest crowd in Paris’ history just proclaimed “Je Suis Charlie” as Germany’s Prime Minister locked arms with the President of France and marched the streets that her country had occupied generations ago. The heroic Israeli Prime Minister Benjamin Netanyahu, the King and Queen of Jordan, the UK’s Prime Minister, the President of Mali, the Palestinian President, and so many others all put differences aside to proclaim, “Enough is enough! Evil shall not triumph!”

There was one noticeable absence – the man who promised in 2008 to restore America’s image around the world…the man nominated for the Nobel Peace prize just two weeks into this failed Presidency…the man who would seek to destroy those who effectively question what he is doing to America and her allies. Where was President Obama? Or even, in his stead, Vice President Biden? Secretary Kerry? I’ve no idea what took precedence on our President’s schedule this weekend, but America was MIA as the rest of the civilized world unified against Islamic fundamentalism.

Paris

I humbly dare speak for many concerned Americans tonight in asking, “Good God, Mr. President, we were once known as the leader of the free world, standing for what is right! You must not let America’s sacrifices be in vain. When will you learn that actions speak louder than your words?”

To the people of France, please know that we, the American people, stand with you in this fight against the insanity that is Islamic fundamentalism. Americans love our fellow man seeking peace, so we cry with you, “Je suis Charlie!”

There are more of us than there are of them. Barack Hussein Obama, do not give an inch to this evil.

http://www.dailymail.co.uk/…/America-snubs-historic-Paris-r…

– Sarah Palin

Paris1

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dec #jobsreport: record 55,807,000 women unemployed; labor participation rate 26yr Low

A record 55,807,000 women 16 years and older did not participate in the labor force in December, according to data from the Bureau of Labor Statistics (BLS). This means that 55,807,000 women in the United States did not have a job and did not actively seek one in the past four weeks.

The number of women not in the labor force increased from 55,195,000 in November to 55,807,000 in December, an increase of 612,000.

LPRwomen

The participation rate for women hit a record low for this year of 56.6 percent, which also matches the 56.6 percent seen in September 1988, a 26-year low. The labor force participation rate, as calculated by the BLS, is the percentage of this population that either has a job or actively sought one in the last four weeks.

The number of employed women decreased from 69,247,000 in November to 69,042,000 in December, a decline of 205,000. However, the number of unemployed women also declined from 4,195,000 in November to 3,878,000 in December, which means there were 317,000 less unemployed women in September.

The unemployment rate for women declined from 5.7 percent in November to 5.3 in December.

CNS News: Dec #JobsReport: Record 55,807,000 women unemployed; Labor Participation Rate 26yr