Archive
All Eyes on the U.S. Dollar: Danielle Park
China official: GOP ‘playing with fire’ with debt ceiling
There’s been an interesting warning on the debt ceiling today — from China.
Li Daokui, an adviser to the People’s Bank of China, told reporters in Beijing, “I think there is a risk that the U.S. debt default may happen.” And he puts the blame on congressional Republicans. “The result will be very serious and I really hope that they would stop playing with fire,” he said.
China is no disinterested party: It holds more than $1 trillion in Treasury debt as of March.
President Obama may well agree with the Chinese banker’s sentiment, as he urges Congress to go ahead and raise the nation’s $14.3 trillion debt ceiling.
Technically, U.S. obligations have already risen past that ceiling, but the Treasury Department says it can use accounting maneuvers to keep paying bills until Aug. 2.
Congressional Republicans, including those who control the U.S. House, say they won’t agree to a debt ceiling increase unless the White House and Democrats agree to major spending cuts.
The two sides are negotiating — as the world waits.
“I really worry about the risks of a U.S. debt default, which I think may lead to a decline in the dollar’s value,” Li said.
U.S.-Canada Perimeter Security and an Integrated North American Command
While few details have emerged surrounding talks between the U.S. and Canada on a North American security perimeter, there is little doubt that deeper military integration between both countries will play an important part of any such deal. Plans for a common security perimeter have renewed calls to expand the NORAD bilateral air defence model to include ground and naval forces. There are also efforts to increase security cooperation in the Arctic and further integrate military command structures.
As part of the Tri Command Vision, North American Aerospace Defense Command (NORAD), United States Northern Command (USNORTHCOM), and Canada Command (Canada COM) are working closer together in the defense and security of North America. Moving forward, the Tri Command strategic goals are to, “Improve unity of effort with each other and with our respective mission partners; develop a culture of continuous collaboration and cooperation in planning, execution, training, information management, and innovation; enhance intelligence and information sharing and fusion.” In order to better achieve these objectives, “The Commands shall develop and share Read more…
Beijing warned on dollar holdings
China is running a major risk in holding so many dollars because the US may deliberately devalue its currency, a senior Chinese official has warned.
The comments by Guan Tao, head of the international payments department in the State Administration of Foreign Exchange, knocked the dollar on Tuesday, adding to fears about the struggling US economy. The dollar fell to a one-month low against a basket of six leading currencies.
Pressure on the dollar has intensified amid heightened concerns that the soft patch in the US economy will ensure that the Federal Reserve sticks to its ultra-loose monetary policy in the near future.
Despite Mr Guan’s concerns, which are often voiced in Beijing, analysts said that China had little choice but to recycle its vast foreign currency reserves into dollar-denominated assets. “The United States has adopted expansionary fiscal and monetary policy to stimulate economic growth,” Mr Guan said in an article that was published on the website of China Finance 40 Forum, a Beijing economic think tank.
“The United States may find it hard to Read more…
NIA Releases U.S. Economic and Inflation Update
The official U.S. unemployment rate rose during the month of May to 9.1%, up from 9% in April, with only 54,000 non-farm jobs being created for the month. The real unemployment rate including short and long-term discouraged workers is now 22.3%. The Bureau of Labor Statistics (BLS) used the birth/death model to produce a positive monthly bias during the month of May of 206,000 jobs, up from 175,000 in April, 117,000 in March, and 112,000 in February. Without the birth/death model, 152,000 jobs were lost during the month of May.
By utilizing the birth/death model, the BLS is assuming that during the month of May, the number of new jobs created by start-up businesses were 206,000 greater than the number of jobs lost from companies going out of business. NIA finds this assumption to be Read more…
Senators Want To Put People In Jail For Embedding YouTube Videos
I am speechless…the NWO cometh
from the not-understanding-the-technology dept
Okay, this is just getting ridiculous. A few weeks back, we noted that Senators Amy Klobuchar, John Cornyn and Christopher Coons had proposed a new bill that was designed to make “streaming” infringing material a felony. At the time, the actual text of the bill wasn’t available, but we assumed, naturally, that it would just extend “public performance” rights to section 506a of the Copyright Act.
Supporters of this bill claim that all it’s really doing is harmonizing US copyright law’s civil and criminal sections. After all, the rights afforded under copyright law in civil cases cover a list of rights: reproduce, distribute, prepare derivative works or perform the work. The rules for criminal infringement only cover reproducing and distributing — but not performing. So, supporters claim, all this does is “harmonize” copyright law and bring the criminal Read more…
Pinks Slips Coming For 450,000 State and Local Government Employees in 2012
In June of 2010 we noted that well known financial sector analyst and the woman who blew the doors open on the 2008 mortgage crisis, Meredith Whitney, was forecasting that two million government employees would see their jobs cut over coming years because of fiscal problems.
It’s happening.
Over 300,000 jobs have been cut in fiscal year 2011, and that number is about to increase 50% going into 2012:
Around 450,000 people who work for U.S. states, counties, cities, towns and villages could get pink slips in fiscal 2012, sharply up from the 300,000 positions shed this year, a report said on Monday.
The number of job cuts will rise mainly because the federal stimulus program Read more…
New signs economy’s recovery faltering
Evan Solomon worked at the New York Stock Exchange Wednesday as fears that the economy was stalling rattled the markets.
The U.S. economic recovery is faltering, and Washington is running out of ways to get it back on track.
New reports Wednesday showed a steep slowdown in the manufacturing sector and weak private-sector job creation in May. The grim news comes on the heels of other recent indicators — falling home prices and consumer spending — that reflect an economy slowing to a limp this spring.
The data dash the sunnier expectations that many analysts had entering the year; many forecasters had expected economic growth of 3.5 to 4 percent in 2011.
Instead, the U.S. economy appears to be settling back into a pattern of Read more…
Hyperinflation Or Great Depression II?
Western Europe has invented two institutions that have taken over the world: the university and the central bank. Today, both are under fire as never before. At the same time, both are in their respective diver’s seats. The greater the criticism, the better they do for themselves.
We are finally seeing articles on the bubble in higher education. It isn’t a bubble. Government money still flows in by the hundreds of billions a year.
We hear that college isn’t worth the money. Well, if it isn’t, why are parents paying it? Because they are buying a consumer good: social acceptance. They are buying off peer pressure. They are unwilling to say to their friends, “Billy Bob is going to become a plumber.” Yes, Billy Bob will always have a good income, but Billy Bob’s parents are unwilling to accept this. Billy Bob will get his hands dirty . . . with “filthy” lucre. Oh, the horror! Better that he should be an unemployed B.A. in sociology with $23,000 of student debt, and his parents $50,000 to $150,000 poorer.
That is to say, people have priorities that are different from what the journalists (with B.A. degrees in a field with a dismal future) write about in their articles. The parents will not admit to Read more…
Pentagon: Cyber Attacks Can Qualify as Acts of War
The Pentagon has finished drafting its first official “computer sabotage strategy,” determining that online cyber attacks from another country can constitute an act of war, enabling the U.S. to retaliate with military force.
“If you shut down our power grid, maybe we will put a missile down one of your smokestacks,” a military official told The Wall Street Journal by way of example.
The formal strategy underlines a rising need to systematically respond to attacks on the computer systems of the U.S. and other countries. In 2009, a strain of the Microsoft Windows computer virus Stuxnex, which some believe originated from Israel with U.S. help, damaged Iran’s nuclear facilities. More recently, Google was the victim of cyber attacks that allegedly originated in China, an affair the the White House became involved in.
The 30-page document, unclassified portions of which are expected to become public next month, is also likely to spark debates about a number of unaddressed issues, including whether the U.S. can truly determine the origin of an attack and when a cyber attack is serious enough to constitute an act of war, the WSJ notes.
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