Tag Archives: economy

Government Incompetence: U.S. Navy collides with Japanese oil tanker in Persian Gulf

12 August 2012, on the same day that Japan announced it was sending minesweepers to join the U.S. Navy in the Persian Gulf, a USN destroyer collides with a Japanese oil tanker.

It happened in the middle of the night, near the Hormuz Strait.  The USS Porter is badly damaged and must be repaired.  No injuries were reported. The USN is investigating why the crew of the USS Porter did not see the huge Japanese oil tanker.

There has been no word about damage to the tanker.

Japan had recently allowed the government backing of insurance for Japanese tankers carrying Iranian oil, as a way to get around U.S./European sanctions.  Japan also discussed with Iran the possibility of using Iranian insurance companies.

 

What Economic Recovery? Top 5 U.S. banks ordered to make living wills, two years ago! 9 Too Big to Fails now have living wills!

10 August 2012, Reuters published an exclusive report revealing that U.S. banks were ordered to make “living wills”, because of an expected economic collapse!

The order came from the privately run Federal Reserve Bank, and the U.S. Office of the Comptroller of the Currency.  The 2010 order was targeted at five U.S. national banks: Citigroup, Morgan Stanley, JP Morgan Chase, Bank of America and Goldman Sachs.

Both the Federal Reserve and the U.S. government indicated that there was no way to save the banking industry in a full blown economic collapse: “…make no assumption of extraordinary support from the public sector…”

The Reuters’ report explained that living wills for corporations are not the same as bailouts/recovery plans.  In the living will the too big to fail bank is basically finished, but directs how any remaining assets shall be liquidated (sold off) in order to prevent a total collapse of the banking/finance system.

Already, nine international banks have submitted their living wills to the Federal Reserve and the Federal Deposit Insurance Corporation.

 

11 August 2012: Busiest Chubbuck Days ever! Dogs, cars, fire trucks, hammers and poles being thrown around, plus food, music & vandalism Chubbuck style!

I’ve been attending Chubbuck Days since 1998 (I live right next to Cotant Park where they’re held every year), and this year’s events were the busiest ever!

Click pics to make bigger

Busiest Chubbuck Days ever, August 2012: 6TH ANNUAL CAR SHOW (PART 2) 

6TH ANNUAL CAR SHOW (PART 1)

4TH ANNUAL EASTERN IDAHO SCOTTISH GAMES

What Economic Recovery? 290 U.S. cities downgraded! Local tax revenues down, again!

“We expect downgrades to continue outpacing upgrades in the second half of 2012 as local governments navigate an increasingly difficult budgeting environment characterized by anemic revenue growth and significant expenditure pressure on wages and post employment benefits.”-Moody’s statement

09 August 2012, Moody’s Investors Service downgraded the largest number of U.S. cities/school districts since 2000.

The latest downgrades mark 14 straight quarters in which municipal bond downgrades exceeded increases!

In another report by Nelson A. Rockefeller Institute of Government, tax revenues collected by local governments are down, for the sixth consecutive quarter!

The latest reports and downgrades only adds ammo to the “tip of the iceberg” bankruptcies filed by local governments.

 

Global Economic War: British bank official tells the United States to F Off, literally!!!

“You fucking Americans! Who are you to tell us, the rest of the World, that we’re not going to deal with Iranians?”-attributed to Richard Meddings, finance director of Standard Chartered Group

According to U.S. banking regulators, the above statement was made by the British banking official back in 2006 (under the Bush Jr administration), after being questioned about money laundering!

Now the New York State Department of Financial Services named United Kingdom’s Standard Chartered a “rogue” bank, and threatens to strip its New York banking license.  The reason is that Standard Charter refuses to go along with U.S., and even British, financial sanctions against Iran.

Meanwhile, international commentators are saying this is proof that the United States has lost significant influence over the rest of the World, including their evil ally the British empire!

 

What Economic Recovery? Hewlett Packard to layoff 300 British employees, government officials calling it a “quarterly cull”! HP has too much debt, turns to GE for help!

“This is not part of the global program, it’s just a quarterly cull.”-unnamed government source

03 August 2012, news media in the United Kingdom have discovered that Hewlett Packard (HP) has told the British government they will let go at least 268 employees.

British law requires companies that are laying off more than 20 employees to notify the government.

Despite the unnamed government official’s statement, some analysts believe this is part of the planed layoff of 27,000 HP employees by October 2014.

HP officials in France and Germany said they’re planing to cut their workforce by 10%.  In Sweden it could be as high as 14%.  Italy and Spain are still awaiting HP’s layoff estimates.  Even the announced 268 layoffs in the U.K. are not considered the final cut.

Unions in Britain are claiming that HP will end up laying off at least 1,600 employees.  CEO Meg Whitman, refused to answer British media questions.

On 30 July 2012, the Wall Street Journal reported that HP was finding it harder and harder to get credit default swaps on its debt.  The cost of such swaps has quadrupled for HP since last year.  That’s because more and more investors are worried that HP will end up busted.

Also, HP’s debt load is now at $21 million USD, no thanks to its recent purchase of a company called Autonomy.

As a result HP has turned to General Electric (GE) for financial help.

On 02 August 2012, GE Capital announced they will offer credit to HP resellers. The offer includes 60 days of no interest re-payments: “Resellers of any size can view this kind of financing as working capital that they can use to help grow their markets and expand their businesses. We’re pleased to be working with HP to support its resellers.”-Mike Marcolina, GE Capital Commercial Distribution Finance

 

 

LIBOR: RBS takes action against its own employees

“The LIBOR situation is on our agenda and is a stark reminder of the damage that individual wrongdoing and inadequate systems and controls can have in terms of financial and reputational impact.”-Stephen Hester, CEO RBS

03 August 2012, the Royal Bank of Scotland announced it has fired several employees for their involvement in the LIBOR rigging scandal.

RBS officials said they are cooperating with international investigators.

The government of the United Kingdom owns 82% of RBS.

RBS reported a pre-tax loss of $2.3 billion USD!  RBS is also setting aside $211 million to compensate loan insurance customers. Those customers claim RBS lied to them about what they were getting.

Check my other postings about LIBOR.

Global Economic War: Bolivia clarifies so called ban on Coca Cola, Brazil bans Chevron, South America fighting U.S. yankee crony capitalist imperialism

“December 21 of 2012 will be the end of egoism and division. December 21 should be the end of Coca-Cola.”-David Choquehuanca, Foreign Minister of Bolivia

This recent statement by officials from the South American country has been interpreted as meaning Coca Cola was banned from Bolivia.  But David Choquehuanca has come out and stressed that emphasis needs to placed on his use of the word “should”.

(So far the only countries with official bans on Coca Cola are Korea North, Cuba and Myanmar.)

The government of Bolivia has started a campaign pushing for Bolivians to buy products made in Bolivia, not products from the United States.

Bolivia is not alone as Venezuela has also started a similar campaign.  Venezuela even banned Coke Zero.

In 2011 Bolivia kicked out McDonalds.

At the end of July 2012, the government of Chile filed suit against McDonalds, Burger King and KFC on the grounds they violate the country’s anti-toy in happy meals law.

Also at the end of July 2012, Venezuela shut down 89 McDonalds for tax evasion.

In March 2012, Peru began enforcing their ban on the sale of food products made with genetically modified crops (aka GMO foods). The ban directly affects Monsanto, Dow Chemical and Bayer (a German company).

Brazil and Paraguay have similar bans as well.  Venezuela banned all GMO seeds.

In 2011, Argentina temporarily banned the sale of Blackberry phones and Apple computer products.  Argentina has also temporarily banned U.S. beef products.

Brazil has banned specific ingredients in cigarettes, which is hurting U.S. tobacco companies.

On 02 August 2012, Brazil officially banned Chevron from doing business in their country.  This after two massive, and unexplained, oil spills (of course U.S. media says the spills were minor).

At the end of 2011, the countries of South America formed their own economic union called Comunidad de Estados Latinoamericanos y Caribeños, or Community of Latin American and Caribbean States (CELAC).  The United States and Canada were not invited.

Now, India will be the first country to hold official trade talks with CELAC, scheduled for 07 August: “India enjoys friendly and warm relations with all CELAC countries. They have a shared understanding on the values of democracy, freedom, equality and justice.” Indian Ministry of External Affairs statement

 

 

What Economic Recovery? “tip of iceberg” for U.S. cities going bankrupt or defaulting, blame reduced tax revenues caused by bad economy!

“We went fifty years without any municipal bankruptcies in the United States, and now we are going to get dozens of them. The governing class did not get stupid fast.”-Richard Brodsky, former 14-term New York State assemblyman

(Actually, contrary to Brodsky’s statement, I think there was one chapter 9 bankruptcy in 1994, and another in 2008 [both in California]. But the point is that we’ve never seen the numbers we’re seeing now.)

Since 2010 dozens of cities, counties and local service agencies have gone bankrupt, something not seen in at least fifty years! Analysts are predicting dozens more.  The reason is simple: Bad economy means less jobs, and most of the jobs that are available pay a pittance (minimum wage, no benefits). That means less tax revenue for state and local governments.

Some stupid local governments try to make up for it by raising local taxes.  That shows you how out of touch your local reps are.  If tax revenues are down because most people are making less money, then raising taxes will only make things worse (remember what sparked the U.S. Revolutionary War: Unfair taxes).

2010 Local Government/Service Bankruptcies

Lost Rivers District Hospital, Arco, IDAHO

Lake Lotawana Community Improvement District, Lee’s Summit, MISSOURI

Grimes County MUD 1 and Official Committee of Bondholders, Grimes County, TEXAS

The Southern Connector (toll road), Piedmont, SOUTH CAROLINA

2011 Local Government/Service Bankruptcies

Central Falls, RHODE ISLAND

Jefferson County, ALABAMA

Centerton Municipal Property Owner’s Improvement District 3, Fayetteville,  ARKANSAS

Harrisburg, PENNSYLVANIA (courts rejected claim)

Boise County, IDAHO (courts rejected claim)

Barnwell County Hospital, SOUTH CAROLINA

Bamberg County Memorial Hospital, SOUTH CAROLINA

Sanitary and Improvement District 512, Douglas County, NEBRASKA

Mendocino Coast Recreation and Park District, Fort Bragg, CALIFORNIA

2012 Local Government/Service Bankruptcies & Defaults

Harrisburg, PENNSYLVANIA (default)

Suffolk Regional Off Track Betting Corp, Hauppauge, NEW YORK (second filing, first was rejected by courts in 2011)

Hospital Authority of Charlton County, GEORGIA

Rural Water District 1, Cherokee County, OKLAHOMA

Sylamore Valley Water Association Public Facilities, Izard County, ARKANSAS

Stockton, CALIFORNIA

Mammoth lake, CALIFORNIA

San Bernardino, CALIFORNIA

Seven local governments are under emergency management in MICHIGAN

Analysts predict many more major U.S. cities to go bust

Washington DC: In debt by $537 per resident

Detroit, MICHIGAN: In debt by $217 per resident

Honolulu, HAWAII: In debt by $110 per resident

New York City, NEW YORK: In debt by $565 per resident

Almost every major city in CALIFORNIA (beware the saying; “As California goes, so goes the rest of the nation.”)

Camden, NEW JERSEY: In debt by $54 per resident

Cincinnati, OHIO: In debt by $181 per resident

And the biggest loser is: Chicago, ILLINOIS: In debt by $2,353 per resident

 

What Economic Recovery? Ford and Chevy sales up in the U.S.? So what! Global profits are still crashing! Layoffs in the works!

“We think this is a situation that we will have to deal with for the foreseeable future.”-Bob Shanks, Ford CFO

“We have overcapacity now in Europe. It isn’t going to come back fast and we aren’t going to be saved by volume.”-Alan Mulally, Ford CEO

02 August 2012, Ford and General Motors (GM) reporting falling profits despite earlier reports of increased sales.

GM reporting a drop in profits of 41% compared to the same time last year.  Ford reporting a 57% drop!  Both blame crashing sales in the European Union. GM lost $361 million USD in Europe, Ford lost $404 million!

GM’s biggest European brand, Opel, has been losing money big time.  German newspapers are reporting major changes in the works, such as reducing pay for employees, layoffs and even ending some production in the United States, shifting that production to Europe then shipping the cars to the U.S. for sale (of course that would mean layoffs for U.S. workers).

Chrysler, now controlled by Italy’s Fiat, was the only one to see an increase in profits. However, Fiat is hoping to use Chrysler to offset Fiat losses in Europe.

Ford also had profit losses in South America and Asia, which is worrisome since those are the two big vehicle sales markets right now. When asked if factory closings and layoffs were in the works, Ford’s CEO said cuts to “all areas of the business” were being considered.