Iceland: Economy Exits Recession

Even better off is Greenland:

Why is Greenland so rich these days? It said goodbye to the EU!

At least Iceland didn’t bailout the banksters:

Max Keiser: The IMF Is Bankrupt – The Fed And The Banksters – Iceland Report – And More

Whereas Ireland is completely doomed:

And Now … Ireland: Pension Reserve Funds To Be Spent On The Banksters

The Anglo Irish Bank losses are the worst in the entire world and the bailout is an unprecedented looting of the Irish taxpayer.


Decision to force bondholders to pay for banking system’s collapse appears to pay off as economy grows 1.2% in third quarter


Nobel prize winner Paul Krugman has repeatedly called on Ireland, Greece and Portugal to consider leaving the euro area and defaulting on debts. Photograph: Mike Clarke/AFP/Getty Images

Iceland’s decision two years ago to force bondholders to pay for the banking system’s collapse appeared to pay off after official figures showed the country exited recession in the third quarter.

The Icelandic economy, which contracted for seven consecutive quarters until the summer, grew by 1.2% in the three months to the end of September.

Iceland famously agreed in a referendum to reject a scheme to repay most of its debts that were once worth 11 times its total national income.

In contrast to Ireland, Iceland’s taxpayers refused to foot the bill for the debts accumulated by the banking sector. Bondholders were told to accept dramatic reductions in the value of repayments on bank debt after the sector borrowed beyond its means to fund ambitious investments abroad.

The return to growth is likely to put pressure on Irish politicians to explain why Dublin rejected a more radical restructuring of its debts and a departure from the eurozone.

Iceland’s currency has fallen by around a quarter, helping its exports.

Read moreIceland: Economy Exits Recession

Prof. Nouriel Roubini: No Defence Left Against Double-Dip Recession

Just that there never was a defense. This entire financial crisis has been engineered.

This will also not be a double-dip recession, but the Greatest Depression ever.


The United States, Japan and large parts of Europe have exhausted their policy arsenal, leaving them defenceless against a double-dip recession as recovery slows to ‘stall speed’.

Nouriel Roubini said the US growth rate was likely to fall below 1pc in the second half of the year
Nouriel Roubini said the US growth rate was likely to fall below 1pc in the second half of the year Photo: BLOOMBERG

“The US has run out of bullets,” said Nouriel Roubini, professor at New York University, and one of a caste of luminaries with grim forecasts at the annual Ambrosetti conference on Lake Como.

“More quantitative easing (bond purchases) by the Federal Reserve is not going to make any difference. Treasury yields are already down to 2.5pc yet credit spreads are widening again. Monetary policy can boost liquidity but it can’t deal with solvency problems,” he told Europe’s policy elite.

Dr Roubini said the US growth rate was likely to fall below 1pc in the second half of the year, despite the biggest stimulus in history: a cut in interest rates from 5pc to zero, a budget deficit of 10pc of GDP, and $3 trillion to shore up the financial system.

The anaemic pace compares with rates of 4pc-6pc at this stage of recovery in normal post-war recoveries.

Read moreProf. Nouriel Roubini: No Defence Left Against Double-Dip Recession

The No.1 Trend Forecaster Gerald Celente: And Now We’re Headed For The GREATEST Depression

The fake “recovery” was nice while it lasted, says famous apocalyptic forecaster Gerald Celente, founder of the Trends Research Institute. But now the fun’s over, and we’re headed for what Celente describes as the “Greatest Depression.”

Specifically, the always startling Celente says the country is headed for rising unemployment, poverty, and violent class warfare as the government efforts to keep the economy going begin to fail.

The crux of the problem, Celente argues, is that the middle class has been wiped out. America used to be a land of opportunity for all, where hard-working people could build their own small businesses in their own communities and live prosperous and fulfilling lives. But now a collusion of state and corporate interests that Celente describes as “fascism” have conspired to help only the biggest companies and the richest Americans. This has put a shocking amount of the country’s wealth in the hands of a privileged few and left the rest of the country to subsist on chicken-feed wages and low job satisfaction as Wal-Mart “associates” — or worse.

Read moreThe No.1 Trend Forecaster Gerald Celente: And Now We’re Headed For The GREATEST Depression

John Williams: ‘Times That Try Our Souls’ (U.S. Bankruptcy – Hyperinflation – Great Depression), Preparedness Can Save Your Life

Highly recommended reading.

The Greatest Depression is here.


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When Fed Chairman Ben Bernanke admits to seeing an “unusually uncertain” economy ahead, it’s pretty terrifying to imagine what he’s really thinking. What John Williams envisions-and he’s by no means looking to the far horizon-is a systemic collapse, a hyperinflationary great depression and the cessation of normal commerce. Despite that bleak outlook, however, when the economist and editor of ShadowStats.com sat down for this exclusive Energy Report interview, he also had some good news.

The Energy Report: A few months back, John, you said, “if you strangle liquidity you always contract an economy and deliberately or not, liquidity is being strangled, resulting in sharp declines in consumer credit, commercial and industrial loans.” Does this mean it would spur more economic growth if banks actually started lending?

John Williams: It sure wouldn’t hurt. We’re still seeing contractions in liquidity, and that’s adjusted for inflation. In real terms, M3 money supply is down almost 8% year-over-year. It’s the sharpest fall in the post -World War II era. It’s not so much the depth of the decline in the liquidity or the duration, but the fact that the liquidity turns negative year-over-year that signals the economy turning down.

We had the signal in December of 2009 indicating intensification of the downturn, in this case, within six to nine months. We’re in that timeframe now and see softening numbers. People are talking about a weaker economy. Even Mr. Bernanke has described the economy as “unusually uncertain” in terms of its outlook. Wording like that from the Fed is a pretty good indication that something’s afoot.

Read moreJohn Williams: ‘Times That Try Our Souls’ (U.S. Bankruptcy – Hyperinflation – Great Depression), Preparedness Can Save Your Life

US Job Losses In July Are Double Expected Figure

There is no recovery! This is the Greatest Depression.

US: Food stamp Use Hit Record 40.8 Million in May


• American firms shed 131,000 jobs in July

• UK thinktank warns British ‘depression’ will last until 2012

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Job seekers speak with recruiters during a career fair in Chicago but there are fears that a recovery in the US economy will not mean a revival in employment (Getty Images)

Employers in the US shed twice as many jobs as expected in July, adding to fears that the recovery in the world’s largest economy will not see a revival in employment.

The dismal US job figures came as the National Institute of Economic and Social Research predicted a protracted depression for the UK economy.

Across the Atlantic talk of a double-dip recession was revived when the government revealed 131,000 jobs were lost last month. That dwarfed forecasts for a fall of 65,000. June’s drop was also revised to a far steeper 221,000 from 125,000.

Read moreUS Job Losses In July Are Double Expected Figure

UK: Food Inflation May Rise 10 Percent Before Christmas

Chris Etherington, chief executive of wholesaler P&H, said: “I think this could be the beginning of the double-dip recession. This is really scary stuff.”

Again: This is the Greatest Depression! Prepare yourself now.

See also: Bank of England’s Mervyn King Warns Over High Inflation


The cost of food is likely to jump by up to 10 per cent before Christmas after dry weather drastically reduced the amount of winter feed that farmers could harvest, experts said.

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Wheat: expensive. (Getty Images)

The price of milk, cheese, chicken, beef and pork and associated products are all expected to rise because the industry has been hit by soaring animal feed prices, a shortage of silage and poor harvests.

Food inflation is closely linked to overall inflation and some in the industry have warned it could push the economy towards a “double-dip” recession.

BOCM Pauls, Britain’s biggest animal feed supplier, has reported a 20 per cent increase in the price of raw material feed on last year

The cost of wheat used as animal feed has also jumped by 30 per cent.

The company warned that the price at which it sells feed to dairy, poultry, beef and pig farmers would have to increase by the same amount over the next three months, trade magazine The Grocer said.

It is possible that such a margin could be passed on to consumers, however, it is unlikely to be passed on in full. Instead, prices are likely to go up while producers’ and retailers’ profit margins are also squeezed.

The National Farmers’ Union said the dry weather had added to its members’ problems by slashing the yields of silage for winter feed by up to 50 per cent.

Food producers are already suffering from the high cost of common ingredients such as palm oil, cocoa and soya oil, which have risen by 39 per cent, 23 per cent and 14 per cent respectively since last year, according to Mintec figures.

Read moreUK: Food Inflation May Rise 10 Percent Before Christmas

UK: Recession Even Deeper Than First Thought

Six successive quarters of negative economic growth from spring 2008 until autumn 2009 were the toughest for the economy since the Great Depression of the 1930s

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The UK recession was even deeper than first thought.

The deepest recession in Britain’s post-war history was even more severe than previously feared, the government said today.

Fresh information collected by the Office for National Statistics showed that the peak to trough decline in output was 6.4% of gross domestic product rather than the original 6.2% estimate.

The new figures confirmed that the six successive quarters of negative growth from spring 2008 until autumn 2009 were the toughest for the economy since the Great Depression of the 1930s, harsher even than the slump of the early 1980s.

Read moreUK: Recession Even Deeper Than First Thought

With The US Still Trapped in Depression, This Really Is Starting to Feel Like 1932

This is the Greatest Depression.


The US workforce shrank by 652,000 in June, one of the sharpest contractions ever. The rate of hourly earnings fell 0.1pc. Wages are flirting with deflation.

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People queue for a job fair in New York. The share of the US working-age population with jobs in June fell from 58.7pc to 58.5pc. The ratio was 63pc three years ago. Photo: EPA

“The economy is still in the gravitational pull of the Great Recession,” said Robert Reich, former US labour secretary. “All the booster rockets for getting us beyond it are failing.”

“Home sales are down. Retail sales are down. Factory orders in May suffered their biggest tumble since March of last year. So what are we doing about it? Less than nothing,” he said.

California is tightening faster than Greece. State workers have seen a 14pc fall in earnings this year due to forced furloughs. Governor Arnold Schwarzenegger is cutting pay for 200,000 state workers to the minimum wage of $7.25 an hour to cover his $19bn (£15bn) deficit.

Can Illinois be far behind? The state has a deficit of $12bn and is $5bn in arrears to schools, nursing homes, child care centres, and prisons. “It is getting worse every single day,” said state comptroller Daniel Hynes. “We are not paying bills for absolutely essential services. That is obscene.”

Roughly a million Americans have dropped out of the jobs market altogether over the past two months. That is the only reason why the headline unemployment rate is not exploding to a post-war high.

Let us be honest. The US is still trapped in depression a full 18 months into zero interest rates, quantitative easing (QE), and fiscal stimulus that has pushed the budget deficit above 10pc of GDP.

The share of the US working-age population with jobs in June actually fell from 58.7pc to 58.5pc. This is the real stress indicator. The ratio was 63pc three years ago. Eight million jobs have been lost.

The average time needed to find a job has risen to a record 35.2 weeks. Nothing like this has been seen before in the post-war era. Jeff Weninger, of Harris Private Bank, said this compares with a peak of 21.2 weeks in the Volcker recession of the early 1980s.

“Legions of individuals have been left with stale skills, and little prospect of finding meaningful work, and benefits that are being exhausted. By our math the crop of people who are unemployed but not receiving a check amounts to 9.2m.”

Republicans on Capitol Hill are filibustering a bill to extend the dole for up to 1.2m jobless facing an imminent cut-off. Dean Heller from Vermont called them “hobos”. This really is starting to feel like 1932.

Washington’s fiscal stimulus is draining away. It peaked in the first quarter, yet even then the economy eked out a growth rate of just 2.7pc. This compares with 5.1pc, 9.3pc, 8.1pc and 8.5pc in the four quarters coming off recession in the early 1980s.

The housing market is already crumbling as government props are pulled away. The expiry of homebuyers’ tax credit led to a 30pc fall in the number of buyers signing contracts in May. “It is cataclysmic,” said David Bloom from HSBC.

Read moreWith The US Still Trapped in Depression, This Really Is Starting to Feel Like 1932

US: 7.9 Million Jobs Lost, Many Forever

More green shoots and strong recovery signs:

Howard Davidowitz: Obama is ‘Mr. Mass Destruction’ – US Economy ‘Is a Complete Disaster’

US: 1.2 Million Lose Unemployment Benefits Today

US Economy Shed 125,000 Jobs in June

RBS tells clients to ‘think the unthinkable’ and prepare for ‘monster’ money-printing by the Fed

US: 46 States Face Greek-Style Debt Crises

US: New Home Sales Plummet to Record Low

US: New claims for jobless benefits rise sharply

This is the Greatest Depression.


(CNN Money) — The recession killed off 7.9 million jobs. It’s increasingly likely that many will never come back.

The government jobs report issued Friday shows that businesses have slowed their pace of hiring to a relative trickle.

“The job losses during the Great Recession were so off the chart, that even though we’ve gained about 600,000 private sector jobs back, we’ve got nearly 8 million jobs to go,” said Lakshman Achuthan, managing director of Economic Cycle Research Institute.

Excluding temporary Census workers, the economy has added fewer than 100,000 jobs a month this year — a much faster and stronger jobs recovery than occurred following the last two recessions in 2001 and 1991.

Read moreUS: 7.9 Million Jobs Lost, Many Forever

Wall Street Is A High-On-Crack Driver That Just Smashed Into Your House

Compared to Wall Street the US government and the Fed nuked the economy, the dollar and any bright future that the people in the US might have had. The people will experience the fallout very soon.

The ‘Greatest Depression’.

Cynthia McKinney is spot-on :

Cynthia McKinney at Munich Germany NATO Peace Rally: ‘My Country Has Been Hijacked By A Criminal Cabal’


janet_tavakoli

(This guest post comes from Tavakoli Structured Finance)

If a high-on-crack driver crashed his speeding rental car into your house and killed your spouse, you would be outraged if law enforcers took bribes and gave the driver a pass on a blood test. If the judge then merely fined the killer and ordered you to pay it, you would appeal, wondering what happened to justice. If the government then handed the crack-driver keys to a bigger rental car and presented you with the rental bill, you would certainly protest.

How is it, then, that you have remained largely silent in the face of the same sort of behavior by Wall Street and Washington? Bonus-seeking bankers careened off the right path and ran Ponzi schemes that nearly ruined our economy. Bureaucrats and elected officials bailed them out without demanding consequences. Bankers are revving their engines again.

Bankers Get Bonuses, the USA Gets the Great Recession

Taxpayers are asked to believe that over-borrowing by U.S. consumers created a global financial crisis. This myth aids and abets Wall Street. The economy was nearly destroyed because banks borrowed massively, and they borrowed many multiples more than they could afford. Wall Street pumped the Fed’s cheap money through financial meth labs, and deceptive financial vehicles ran over securities laws at top speed.

More than 20% of mortgage loans–including originally sound loans–are underwater, meaning the borrower owes more than the home is worth. Official unemployment numbers hover at around 10%. If you include underemployment, it is around 18%. In depressed areas where the nation’s poorest–chiefly minorities–have been hurt the most, unemployment has soared past 30%. For this destitute group, unemployment combined with underemployment exceeds 50%.

As U.S. soldiers fought wars in Iraq and Afghanistan, Wall Street flattened Main Street. Our foreign wars drag on, while the U.S. battles a crippling recession at home.

Global Ponzi Scheme

Fraud by borrowers, fraud on borrowers, and speculation by people who thought home prices would rise forever have all tarnished mortgage lending. Yet this pales compared to the epidemic of predatory lending.

Predatory snipers committed financial murder as deliberately as British soldiers sold smallpox contaminated blankets to Native Americans. Honest homeowners were systematically targeted and actively misled into bad mortgage products. Loans were presented as gifts, but these Trojan horse loans hid destructive risk. “Disclosures” were acts of malice.

When Wall Street packaged these loans and sold deceptive “investments,” documents did not specifically disclose that credit ratings were misleading. If you know or should know a car’s gas tank will blow up, you cannot use a misleading third-party consumer report as an excuse. Yet bonus-seeking bankers used this sort of excuse to get through a few more highly-paid bonus cycles, before it all fell apart. Only the elite crowd of insiders prospered.*

This was the most massive Ponzi scheme in the history of the global capital markets. U.S. taxpayers became unwilling unsophisticated investors when we bailed out the financial system. We must hold Wall Street accountable for its fraud.

Read moreWall Street Is A High-On-Crack Driver That Just Smashed Into Your House

Rep. Ron Paul: State of the Republic Address – ‘Dangerous Times Indeed.’

“The collapse of the financial system is still in its early stage.”

“The social unrest will illicit cries for the government to exert unusual force to head off a complete breakdown of law and order. The ultimate trap will be set for a system of government claiming to protect a free society.”

“If more power and police authority are not given to the Federal government, it will be argued that only anarchy will result. If more government policing power is given, it will mean a lethal threat to civil liberties.”

“We are rapidly moving toward a dangerous time in our history. Society as we know it is vulnerable to political and social unrest. This impending crisis comes as a consequence of our flawed foreign and domestic economic policies, a silly notion about money, ignorance about central banking, ignoring the onerous power and mischief of out of control intelligence agencies, our unsustainable welfare state and a willingness to sacrifice privacy and civil liberties in an attempt to achieve safety and security from an inept government.”

“Dangerous times indeed.”

“The only way that we can prevent blood from running in the streets is to offer a better idea of the proper role of government in a society that desires, first and foremost, liberty.”

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The Fed and the US government are destroying America:

America’s Impending Master Class Dictatorship! (MUST-READ!)

The CFR Controls American News/Media

Senate Proposes Increasing US Debt Limit to $14.3 Trillion: “If Congress does not enact this legislation, and soon, then the Treasury would default on its debt for the first time in history,” said Senate Finance Committee Chairman Max Baucus

US: Unfunded Benefits Dig States’ $3 Trillion Hole

Illinois enters a state of insolvency: ‘We’re close to de facto bankruptcy, if not de jure bankruptcy.’

The No.1 Trend Forecaster Gerald Celente: Financial Mafia Controlling US and Wall Street

Peter Schiff: The Lunacy of US Government Programs

– Former Dean of Harvard College Harry R. Lewis: Larry Summers, Robert Rubin: Will The Harvard Shadow Elite Bankrupt The University And The Country?

Read moreRep. Ron Paul: State of the Republic Address – ‘Dangerous Times Indeed.’

US slides deeper into depression as Wall Street revels

December was the worst month for US unemployment since the Great Recession began.

wall-street-crash-of-1929
History repeating itself? President Obama has been accused by some economists of making the same mistakes policymakers in the US made in the Great Depression, which followed the Wall Street crash of 1929, pictured Photo: AP

The labour force contracted by 661,000. This did not show up in the headline jobless rate because so many Americans dropped out of the system. The broad U6 category of unemployment rose to 17.3pc. That is the one that matters.

Wall Street rallied. Bulls hope that weak jobs data will postpone monetary tightening: a silver lining in every catastrophe, or perhaps a further exhibit of market infantilism.

The home foreclosure guillotine usually drops a year or so after people lose their job, and exhaust their savings. The local sheriff will escort them out of the door, often with some sympathy — just like the police in 1932, mostly Irish Catholics who tithed 1pc of their pay for soup kitchens.

Realtytrac says defaults and repossessions have been running at over 300,000 a month since February. One million American families lost their homes in the fourth quarter. Moody’s Economy.com expects another 2.4m homes to go this year. Taken together, this looks awfully like Steinbeck’s Grapes of Wrath.

Judges are finding ways to block evictions. One magistrate in Minnesota halted a case calling the creditor “harsh, repugnant, shocking and repulsive”. We are not far from a de facto moratorium in some areas.

This is how it ended between 1932 and 1934, when half the US states declared moratoria or “Farm Holidays”. Such flexibility innoculated America’s democracy against the appeal of Red Unions and Coughlin Fascists. The home siezures are occurring despite frantic efforts by the Obama administration to delay the process.

Read moreUS slides deeper into depression as Wall Street revels

Japan: When Home Is a Tiny Plastic Bunk Barely Bigger Than A Coffin

Atsushi Nakanishi has condensed his possessions to two suitcases, which he stores in lockers at the capsule hotel where he lives.

japan-when-home-is-a-cubicle-barely-bigger-than-a-coffin
Atsushi Nakanishi is among the jobless living in a capsule hotel, renting a bunk with no door.

japan-when-home-is-a-cubicle-barely-bigger-than-a-coffin-02
The capsules have no doors, only screens that pull down. Every bump of the shoulder on the plastic walls, every muffled cough, echoes loudly through the rows.

OKYO — For Atsushi Nakanishi, jobless since Christmas, home is a cubicle barely bigger than a coffin — one of dozens of berths stacked two units high in one of central Tokyo’s decrepit “capsule” hotels.

“It’s just a place to crawl into and sleep,” he said, rolling his neck and stroking his black suit — one of just two he owns after discarding the rest of his wardrobe for lack of space. “You get used to it.”

When Capsule Hotel Shinjuku 510 opened nearly two decades ago, Japan was just beginning to pull back from its bubble economy, and the hotel’s tiny plastic cubicles offered a night’s refuge to salarymen who had missed the last train home.

Now, Hotel Shinjuku 510’s capsules, no larger than 6 1/2 feet long by 5 feet wide, and not tall enough to stand up in, have become an affordable option for some people with nowhere else to go as Japan endures its worst recession since World War II.

Once-booming exporters laid off workers en masse in 2009 as the global economic crisis pushed down demand. Many of the newly unemployed, forced from their company-sponsored housing or unable to make rent, have become homeless.

The country’s woes have led the government to open emergency shelters over the New Year holiday in a nationwide drive to help the homeless. The Democratic Party, which swept to power in September, wants to avoid the fate of the previous pro-business government, which was caught off-guard when unemployed workers pitched tents near public offices last year to call attention to their plight.

“In this bitter-cold New Year’s season, the government intends to do all it can to help those who face hardship,” Prime Minister Yukio Hatoyama said in a video posted Dec. 26 on YouTube. “You are not alone.”

On Friday, he visited a Tokyo shelter housing 700 homeless people, telling reporters that “help can’t wait.”

Read moreJapan: When Home Is a Tiny Plastic Bunk Barely Bigger Than A Coffin

Famous Investor Jim Rogers: Incompetence In Washington, Abolish The Fed And The Treasury

“Mr. Geithner has been wrong about everything for the last 15 years.”


Added: 12. December 2009

Ron Paul: Be Prepared for the Worst

Quotes from the Great Depression


The large-scale government intervention in the economy is going to end badly.

ron-paul-be-prepared-for-the-worst

Any number of pundits claim that we have now passed the worst of the recession. Green shoots of recovery are supposedly popping up all around the country, and the economy is expected to resume growing soon at an annual rate of 3% to 4%. Many of these are the same people who insisted that the economy would continue growing last year, even while it was clear that we were already in the beginning stages of a recession.

A false recovery is under way. I am reminded of the outlook in 1930, when the experts were certain that the worst of the Depression was over and that recovery was just around the corner. The economy and stock market seemed to be recovering, and there was optimism that the recession, like many of those before it, would be over in a year or less. Instead, the interventionist policies of Hoover and Roosevelt caused the Depression to worsen, and the Dow Jones industrial average did not recover to 1929 levels until 1954. I fear that our stimulus and bailout programs have already done too much to prevent the economy from recovering in a natural manner and will result in yet another asset bubble.

Anytime the central bank intervenes to pump trillions of dollars into the financial system, a bubble is created that must eventually deflate. We have seen the results of Alan Greenspan’s excessively low interest rates: the housing bubble, the explosion of subprime loans and the subsequent collapse of the bubble, which took down numerous financial institutions. Rather than allow the market to correct itself and clear away the worst excesses of the boom period, the Federal Reserve and the U.S. Treasury colluded to put taxpayers on the hook for trillions of dollars. Those banks and financial institutions that took on the largest risks and performed worst were rewarded with billions in taxpayer dollars, allowing them to survive and compete with their better-managed peers.

Read moreRon Paul: Be Prepared for the Worst

Britain stays in recession – GDP data market reaction: Sterling tumbles

Shock economic figures today stunned the City by revealing that Britain is wallowing in its longest recession since records began.

The official statistics — which showed that the economy contracted by 0.4 per cent — prompted a furious new row about the Government’s handling of the economy.

The figures, from the Office for National Statistics, mean that national output has now fallen for an unprecedented six successive quarters.

Martin Bentham and Joe Murphy
23.10.09

Full article here: London Evening Standard



Sterling gets hammered against the dollar:

sterling-gets-hammered-against-the-dollar

… and against the euro:

sterling-gets-hammered-against-the-euro

By Miles Johnson
Oct 23, 2009 09:51

Full article here: Financial Times

Iceland: Economy to Shrink 8,5%, Prices to Increase 11,7%, Stock Market lost 97%

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Johanna Sigurdardottir, Iceland’s prime minister

Oct. 12 (Bloomberg) — Arni Hallgrimsson lost his job as a public relations consultant when Iceland’s three biggest banks collapsed last year, putting him out of work for the first time since 1980. After a stint cleaning the docks at a whaling station during the summer hunt, he’s unemployed again.

“Nightmares come to an end when you wake up, but this one just goes on and on and on and on,” the 53-year-old father of three said at his home in Reykjavik, Iceland’s capital. “I’ve applied for many jobs that fit my profile. Sometimes I’ve been on the short-list, but eventually not been offered the job.”

A year after the banking crisis brought Iceland to the brink of bankruptcy, the island nation is mired in the deepest recession among advanced economies. The stock market has lost 97 percent of its value, and more than 780 companies have buckled under the weight of foreign currency loans as the krona plunged. Consumers refuse to borrow at Europe’s highest interest rates, and international banks reject requests for new financing.

Read moreIceland: Economy to Shrink 8,5%, Prices to Increase 11,7%, Stock Market lost 97%

US: 10,000 apply for 90 factory jobs at General Electric

In the latest sign of weakness in Louisville-area employment, about 10,000 people applied over three days for 90 jobs building washing machines at General Electric for about $27,000 per year and hefty benefits.

The jobs dangle medical, eye care, prescription and dental benefit packages, as well as pension, disability, tuition assistance and more, said GE spokeswoman Kim Freeman. And despite the recession, no union workers have been laid off from Appliance Park since the company negotiated lower wages with workers in 2005.

“There are no jobs out there paying these kinds of wages that also offer these kind of benefits,” said Jerry Carney, president of IUE-CWA Local 761 at Appliance Park.

Just four years ago, the same jobs paid $19 per hour. But that was before Local 761 approved wage cuts for new workers aimed at preventing the closure of Appliance Park.

“People still value these jobs,” Freeman said.

Read moreUS: 10,000 apply for 90 factory jobs at General Electric

Peter Schiff: ‘The real economic crash has just started’ (Oct. 03, 2009)

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Read morePeter Schiff: ‘The real economic crash has just started’ (Oct. 03, 2009)

Spain tips into a full-blown economic depression

Spain is sliding into a full-blown economic depression with unemployment approaching levels not seen since the Second Republic of the 1930s and little chance of recovery until well into the next decade, according to a clutch of reports over recent days.

Two Miura fighting bulls are silhouetted against the sky at the Miura ranch near Lora del Rio, southern Spain
Bull run is over: Spain is sliding into a full-blown economic depression akin to that seen in the 1930s Photo: AP

The Madrid research group RR de Acuña & Asociados said the collapse of Spain’s building industry will cause the economy to contract for the next three years, with a peak to trough loss of over 11pc of GDP. The grim forecast is starkly at odds with claims by premier Jose Luis Zapatero, who still says Spain’s recession will be milder than elsewhere in Europe.

RR de Acuña said the overhang of unsold properties on the market, or still being built, has reached 1,623,000 . This dwarfs annual demand of 218,000, and will take six or seven years to clear. The group said Spain’s unemployment will peak at around 25pc, comparable to the worst chapter of the Great Depression.

Spanish workers typically receive 50pc to 60pc of their former pay for eighteen months after losing their job. Then the guillotine falls. Spain’s parliament has rushed through a law guaranteeing €420 a month for long-term unemployed, but this will not prevent a social crisis if the slump drags on.

Separately, UBS said unemployment will reach 4.8m and may go as high as 5.4m if the job purge in the service sector gathers pace. There is the growing risk of a “Lost Decade” akin to Japan’s malaise after the Nikkei bubble.

Roberto Ruiz, the bank’s Spain strategist, said salaries must fall by 10pc in real terms to regain lost competitiveness, replicating the sort of wage squeeze seen in Germany after reunification.

Read moreSpain tips into a full-blown economic depression

Paul Craig Roberts: The Economy is a Lie, too

Ben Bernanke IS RIGHT, ‘the recession is over.’

It is now the ‘Greatest Depression’.


Paul Craig Roberts was Assistant Secretary of the Treasury during President Reagan’s first term. He was Associate Editor of the Wall Street Journal. He has held numerous academic appointments, including the William E. Simon Chair, Center for Strategic and International Studies, Georgetown University, and Senior Research Fellow, Hoover Institution, Stanford University.

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Paul Craig Roberts

Americans cannot get any truth out of their government about anything, the economy included. Americans are being driven into the ground economically, with one million school children now homeless, while Federal Reserve chairman Ben Bernanke announces that the recession is over.

economic crisis   The Economy is a Lie, too
Switzerland World Economic Forum Davos
At the urging of Larry Summers and Goldman Sachs’ CEO Henry Paulson, the Securities and Exchange Commission and the Bush administration went along with removing restrictions on debt leverage.

The spin that masquerades as news is becoming more delusional. Consumer spending is 70% of the US economy. It is the driving force, and it has been shut down. Except for the super rich, there has been no growth in consumer incomes in the 21st century. Statistician John Williams of shadowstats.com reports that real household income has never recovered its pre-2001 peak.

The US economy has been kept going by substituting growth in consumer debt for growth in consumer income. Federal Reserve chairman Alan Greenspan encouraged consumer debt with low interest rates. The low interest rates pushed up home prices, enabling Americans to refinance their homes and spend the equity. Credit cards were maxed out in expectations of rising real estate and equity values to pay the accumulated debt. The binge was halted when the real estate and equity bubbles burst.

As consumers no longer can expand their indebtedness and their incomes are not rising, there is no basis for a growing consumer economy. Indeed, statistics indicate that consumers are paying down debt in their efforts to survive financially. In an economy in which the consumer is the driving force, that is bad news.

The banks, now investment banks thanks to greed-driven deregulation that repealed the learned lessons of the past, were even more reckless than consumers and took speculative leverage to new heights. At the urging of Larry Summers and Goldman Sachs’ CEO Henry Paulson, the Securities and Exchange Commission and the Bush administration went along with removing restrictions on debt leverage.

When the bubble burst, the extraordinary leverage threatened the financial system with collapse. The US Treasury and the Federal Reserve stepped forward with no one knows how many trillions of dollars to “save the financial system,” which, of course, meant to save the greed-driven financial institutions that had caused the economic crisis that dispossessed ordinary Americans of half of their life savings.

The consumer has been chastened, but not the banks. Refreshed with the TARP $700 billion and the Federal Reserve’s expanded balance sheet, banks are again behaving like hedge funds. Leveraged speculation is producing another bubble with the current stock market rally, which is not a sign of economic recovery but is the final savaging of Americans’ wealth by a few investment banks and their Washington friends. Goldman Sachs, rolling in profits, announced six figure bonuses to employees.

The rest of America is suffering terribly.

The unemployment rate, as reported, is a fiction and has been since the Clinton administration. The unemployment rate does not include jobless Americans who have been unemployed for more than a year and have given up on finding work. The reported 10% unemployment rate is understated by the millions of Americans who are suffering long-term unemployment and are no longer counted as unemployed. As each month passes, unemployed Americans drop off the unemployment role due to nothing except the passing of time.

The inflation rate, especially “core inflation,” is another fiction. “Core inflation” does not include food and energy, two of Americans’ biggest budget items. The Consumer Price Index (CPI) assumes, ever since the Boskin Commission during the Clinton administration, that if prices of items go up consumers substitute cheaper items. This is certainly the case, but this way of measuring inflation means that the CPI is no longer comparable to past years, because the basket of goods in the index is variable.

The Boskin Commission’s CPI, by lowering the measured rate of inflation, raises the real GDP growth rate. The result of the statistical manipulation is an understated inflation rate, thus eroding the real value of Social Security income, and an overstated growth rate. Statistical manipulation cloaks a declining standard of living.

In bygone days of American prosperity, American incomes rose with productivity. It was the real growth in American incomes that propelled the US economy.

In today’s America, the only incomes that rise are in the financial sector that risks the country’s future on excessive leverage and in the corporate world that substitutes foreign for American labor. Under the compensation rules and emphasis on shareholder earnings that hold sway in the US today, corporate executives maximize earnings and their compensation by minimizing the employment of Americans.

Try to find some acknowledgement of this in the “mainstream media,” or among economists, who suck up to the offshoring corporations for grants.

The worst part of the decline is yet to come. Bank failures and home foreclosures are yet to peak. The commercial real estate bust is yet to hit. The dollar crisis is building.

When it hits, interest rates will rise dramatically as the US struggles to finance its massive budget and trade deficits while the rest of the world tries to escape a depreciating dollar.

Since the spring of this year, the value of the US dollar has collapsed against every currency except those pegged to it. The Swiss franc has risen 14% against the dollar. Every hard currency from the Canadian dollar to the Euro and UK pound has risen at least 13 % against the US dollar since April 2009. The Japanese yen is not far behind, and the Brazilian real has risen 25% against the almighty US dollar. Even the Russian ruble has risen 13% against the US dollar.

What sort of recovery is it when the safest investment is to bet against the US dollar?

Read morePaul Craig Roberts: The Economy is a Lie, too

US credit card defaults up, signal consumer stress

And now the credit card crisis. Who will bailout the US consumers?

“The defaults are a wake-up call for those expecting a V-shaped recovery.”

V-shape recovery? There is no recovery:

Job Losses: The Scariest Chart Ever


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American Express and MasterCard credit cards are shown in Washington June 25, 2008. (REUTERS)

NEW YORK (Reuters) – Bank of America Corp and Citigroup Inc customers defaulted on their credit card debts in August at the highest rates since the onset of the recession, a sign that the banks’ consumer lending woes are far from over.

The trend was echoed among most other major credit card issuers, dashing optimism sparked when many banks and specialty finance companies reported lower default rates for July.

Read moreUS credit card defaults up, signal consumer stress

Ron Paul on CNN: Federal Government ‘One Giant Toxic Asset’, ‘There Is No Recovery’

Related information:

Joseph Stiglitz: Banking Problems Are Now Bigger Than Before The Crisis:
Sept. 13 (Bloomberg) — Joseph Stiglitz, the Nobel Prize-winning economist, said the U.S. has failed to fix the underlying problems of its banking system after the credit crunch and the collapse of Lehman Brothers Holdings Inc.
“In the U.S. and many other countries, the too-big-to-fail banks have become even bigger,” Stiglitz said in an interview today in Paris. “The problems are worse than they were in 2007 before the crisis.”

Jim Rogers on CNBC: ‘US Bonds Are The Next Bubble’



Th
is video is from CNN’s American Morning, broadcast Sept. 14, 2009.
(Download video via RawReplay.com)

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The US economy has not really recovered from last year’s financial crisis, and the policies of the Federal Reserve, the US’s central bank, are ensuring that the suffering will continue much longer than necessary, US House Rep. Ron Paul told CNN on Monday.

“They claim there’s a recovery but the recovery ought to be measured by the people working. True unemployment is now 16 percent, and the people who lost money have not regained the money. The people who lost houses have not gotten their houses back. There is no recovery,” said Paul.

The official unemployment rate in August was 9.7 percent, but Paul was referring to the broader unemployment measure, known as “U-6,” which measures not only the number of people looking for work but also those people who have given up looking for work. The official unemployment measure does not include people who have stopped looking for work.

In August, the broader U-6 unemployment rate was a stunning 16.8 percent, two-and-a-half percentage points higher than it was in the 1982 recession, which had been the worst recession since the Great Depression.

“There is no recovery, all there is is a lot of fudging,” Paul told CNN’s Kieran Chetly.

Paul was on CNN promoting his new book, End the Fed, in which he argues that the federal government’s bailout of Wall Street has indebted it to the point that the government itself is now “one giant toxic asset.”

Read moreRon Paul on CNN: Federal Government ‘One Giant Toxic Asset’, ‘There Is No Recovery’

Job Losses: The Scariest Chart Ever

This is not an ordinary recession. This is the ‘Greatest Depression’.


Calculated Risk has updated his chart showing job losses as a percent of peak employment since WW2.  Needless to say, it’s not encouraging.

The last time employment fell this much, in 1948, it recovered quickly.  The recent recoveries, however, have been much more gradual.  Unless employment rebounds rapidly (it’s still falling), it’s hard to see how we’re going to get the v-shaped recovery that the bulls are now expecting.

(In 1948, consumers had almost do debt.  Now they have it coming out of their ears).

The unemployment rate, meanwhile, is now the highest it has been in 26 years.

(Click on image to enlarge.)

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Read moreJob Losses: The Scariest Chart Ever