The DNC's attack on Ann Romney epitomizes the utter gutter nastiness of Liberals and progressives.
Ann Romney happens to be a wonderful role model for wives, mothers and women in general as was Sara Palin,though a more earthy version, until the same Liberal long knives 'Zoroed' in on her because she was a threat to them.
I suspect these attacks on women, and most particularly Ann Romney, will backfire as they should.
Women who vote for Obama will prove the anatomical fact I have long held as a stark possibility
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Poof goes the The Magic Liberal Dragon? (See 1 below.)
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Now The Home Depot approach towards the birthing issue. (See 2 below.)
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Response from family member and fellow memo reader to my AARP comments and posting: "
Agree 100% with your friend AARPis a for profit group. income from healthcare,insurance and banking..everybody they
are SELLING to their members.who get no dividends.....
Winners, board members and very highly paid executives regulating their own perks and income. I suspect the supporting cast also does very well financially..I left years ago for the same reason."
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Iran plans on continuing bait and switch approach and will turn their nuclear guns on Israel's nuclear program. Of course, Israel has not threatened to wipe nations off the map. (See 3 below.)
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While away I received these e mails that I concluded were worth posting. (See 4, 4a, 4b and 4c below.)
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As previously noted Shilling remains circumspect. (See 5 below.)
Mark Mobius, a former institutional client, stil believes Bernanke has his foot on the QE accelerator. (See 5a below.)
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DickWhile away I received these e mails that I concluded were worth posting. (See 4, 4a, 4b and 4c below.)
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As previously noted Shilling remains circumspect. (See 5 below.)
Mark Mobius, a former institutional client, stil believes Bernanke has his foot on the QE accelerator. (See 5a below.)
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1)What? The Magic Words Aren't Working!
By Gary Horne
The awful truth is beginning to dawn on the left. The magic words on which they have relied to make government grow may not work anymore. The consequences could be catastrophic for progressives. So it isn't hard to understand why the progressives would visualize a Supreme Court ruling against ObamaCare as "unprecedented."
The case of Wickard v. Filburn is one of the most ludicrous decisions in the history of the Supreme Court. Secretary of Agriculture Wickard attempted to enforce the Agriculture Adjustment Act (AAA) of 1938, which set quotas on the amount of wheat put into interstate commerce and established penalties for overproduction. The secretary levied a fine on Roscoe C. Filburn for exceeding his quota despite the fact that none of Mr. Filburn's wheat was sold outside his state, and the portion sold (he used some himself) did not exceed the quota. The Supreme Court ruled in wartime 1942 (overturning a lower court ruling) that Congress could regulate the production of wheat intended for personal use and not placed in interstate commerce. In other words, the court defined non-commerce (personal consumption) as interstate commerce.
Thus, it is not surprising, then, that the lawyer arguing for ObamaCare might expect the court to redefine a non-tax as a tax (wink). After all, the court's predecessors redefined non-commerce as interstate commerce. Fortunately, the justices didn't seem to buy it.
From the 1942 ruling on, the progressives discovered that all they had to do was simply repeat the magic words, "The Commerce Clause," and the courts would approve nearly everything the Congress wanted. With the oral arguments on ObamaCare, the left had every reason to expect the same result they had seen for the last 70 years. Any other result for them would of course seem "unprecedented."
Another reason why the progressive sees an overturn of ObamaCare as "unprecedented" is because the Court may actually consider the Constitution more important and undo the legal precedent (overturn, or "unprecedent" the precedent). Once a court ruling like Filburn sets a "precedent," the words in the Constitution are tossed into the background. It is almost as if precedent erases portions of the Constitution. To the extent that that happens, we become not a nation of laws, but a nation of men who have ruled contrary to the law.
What has truly been "unprecedented," compared to the first 150 years of general adherence to the principles of the Constitution, is the massive growth and intrusion of the federal government based largely on the three magic words. The abuse of the Commerce Clause has become so entrenched that it is likely that several of the Supreme Court Justices will rule that individuals can be forced into commerce they don't want.
What is truly "unprecedented" is a 2,700-page coercive law delegating the powers of Congress to the executive branch.
Even a cursory reading of the Founders' writings and the Constitution should be enough to understand that this is not what the Founders had in mind. In fact, it is precisely what the Constitution was supposed to have prevented. The Constitution is for the most part clearly written and does not require a law degree to be understood. The law degree seems to be needed to pretend that we are still adhering to the Constitution.
Some progressive members of the Supreme Court do not seem to hold the Constitution worthy of adherence. When Obama-nominated Elena Kagan was dean of Harvard Law School, she dropped the requirement that Harvard Law School students study constitutional law. As was widely reported, Justice Ruth Bader Ginsburg stated in an Egyptian TV interview that "I would not look to the U.S. Constitution if I were drafting a constitution in the year 2012."
The same Supreme Court justice took the following oath of office:
I, _________, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; that I take this obligation freely, without any mental reservation or purpose of evasion; and that I will well and faithfully discharge the duties of the office on which I am about to enter. So help me God.
The justices who ruled against Filburn had taken the same oath.
Had the ghost of Roscoe Filburn watched the oral arguments on ObamaCare, he might have thought the magic words were no longer working, having been stretched to the breaking point. That is exactly what the progressives are afraid of.
2)
o-It-Yourself Proof of the Obama Birth Certificate Fraud
By Giuseppe GoriI think the work of Nick Chase, simplifying "for the masses" the analysis of the forged copy of the Obama long-form birth certificate circulated a year ago by the White House, is absolutely brilliant. I suggest that you read his articles in the American Thinker.
In his first article, "Oblivious to the Obvious," Nick explains pitch in typewriters.
In his second article, "How I Learned to Love Savannah Guthrie," Nick explains how he obtained an original picture and how he used "cut and paste" to move things around.
I do not mind "getting my hands dirty," and so I decided to try it out myself.
Proving that there is a serious problem of authenticity with this document was easier than I expected.
You can do the same, using the same source picture, but using an even a simpler procedure than what Nick Chase described. You can do it on a PC, without having to rotate or touch the images at all. Here is how:
First, I went to the original site showing the copy from Savannah Guthrie: http://lockerz.com/s/96540721.
The following is the original picture of the paper certificate that Savannah Guthrie took on April 27, 2011, as you can find in the above-mentioned site:
I right-clicked on the picture and chose "Copy Image."
Then I opened Microsoft Image Composer and pasted the picture in a new file:
Then I used the "cut out" function to select and cut out the word "Highway".
Then I placed the word "Highway," as cut, above the word "Hospital," precisely aligning vertically the two as. The aim here is to look for differences in alignment, as Nick Chase says:
[A]ll of the typed characters in a row of text would, if placed over another typed row of text, be in perfect vertical alignment (including typed spaces), because each typed character occupies exactly the same horizontal space in its row. That's what "monospace" means[.]
Looking at the above pictures, you can then see that the pitch of the two words is different, as the H of "Highway" is well to the right of the o of "Hospital." You can clearly see that the two words were typed by different typewriters (In addition to having a degree in computer science, I was a typist in the Italian Army). Even the size of the letters is visibly smaller in the word "Highway" than in the word "Hospital."
The above proves that at least two different typewriters were used to type the same certificate.
Is this a conclusive proof? As Nick Chase says:
If you think that the reason why there are two different typewriter typefaces in the document is because two typewriters were used in its preparation, the second typewriter being used because the first broke down -- forget it. ...First, three different typewriter typefaces (and likely more) appear in the document.Second, remember that the proof of forgery in Figure F is not a unique proof [of forgery.] ... Researchers have conclusively demonstrated that the "birth certificate" is fake in many different ways, and that it was digitally constructed. [The above proof] is simply an additional proof of forgery that more people are able to understand because it requires very little technical expertise to comprehend it.
Of course, none of the above has anything to do with where Mr. Obama was born, but it all has everything to do with a forged document released by the White House. I think this is pretty relevant, when such a document is required during the nomination process for the election of the president of the United States, to verify that the qualifications of the candidates comply with the requirements of the law.
If I have a doubt, it is the following: will the non-technical people in the media understand, or accept, this simple demonstration?
3) Exclusive: Iran’s “new initiatives” place Israel at center of nuclear talks
The head of Iran’s National Security Council Saeed Jalili suggested enigmatically Wednesday, April 11, that its representatives would present “new initiatives” at the negotiations with six world powers starting in Istanbul next Saturday. “We hope,” he said, “that the powers will also enter talks with constructive approaches; the language of threat and pressure against the Iranian nation has never yielded results.”
Although Jalili, who will lead the Iranian negotiating team, did not divulge the nature of the new initiatives, debkafile’s Iranian and intelligence sources have obtained their content:
1. Iran will continue to enrich low-grade 3.5 percent uranium but not consent to a cap on quantities;
2. The removal of enriched uranium outside Iran’s borders is not open to discussion and will not be permitted;
3. Iran is prepared for a deal whereby the six powers endorse Iran’s right to enrich as much high-grade 20-percent enriched uranium as it wishes according to a three-part fomula:
a) A joint panel of the six powers and Iran will determine the amounts required to meet the needs of its reactor and the production of isotopes for medical research; b) Iran will sell the surfeit on the international market and become the world’s No. 1 exporter of 20-percent enriched uranium; c) Excess quantities over and above a) and b) will be downgraded by a reverse process from 20 to 3.5 percent.
4. Iran will reject demands to shut down the underground enrichment plant at Fordow, near Qom, but agree to signing the Non-Proliferation Treaty’s Additional Protocol - which would permit IAEA inspectors to make spot checks at all suspect nuclear sites in Iran, including Fordow - with one proviso: The six powers must also require Israel to sign the NPT plus the Additional Protocol. If Israel doesn’t sign both parts of this treaty, neither will Iran endorse the AP.
5. The “Israeli dossier” tops the tactical agenda set out by Iran’s top strategic team for the forthcoming nuclear negotiations Istanbul.
Its representatives will be briefed to turn aside every demand the world powers make of Tehran by twisting it around and pointing it at Israel’s alleged nuclear program. They will argue that they are acting to promote President Barack Obama’s avowed vision of a nuclear-free Middle East. By using this stratagem, the Iranians expect to come away from the negotiating table sitting pretty, having extracted international permission both for enriching as much high-grade uranium as they want and for keeping the Fordow facility in full operation.
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4)In my opinion, this is the MOST SIGNIFICANT DEMONSTRATION of INTENTIONAL DIVISIVE RACEISM by ANY PRESIDENT in the history of OUR COUNTRY that I recall having seen—I personally believe it is DESPICABLE!
Whose President IS HE?
Subject: Obama Announces the 2012 Launch of African Americans for
Obama
This is a Dangerous Video..
Obama Announces the 2012 Launch of African Americans for Obama
this is what racism smells like. It can't be explained away.
Would you vote for a white person who did this? I wouldn't and I
think they would be run right out of town if they tried it.
This is just some food for thought if you're pondering your vote in
November.
Can you imagine Santorum or Romney or Newt or Paul putting out a
call for all the white brothers and sisters to vote for him because
he's white and so are they?
If this video is not alarming to you, simply delete. If you are
offended by what's taking place, please pass it on.
> > > http://www.youtube.com/watch?feature=player_embedded&v=BdjoHA5ocwU#
4a) 12 REASONS TO VOTE DEMOCRAT
When your family or friends cannot explain why they voted Democrat, give them this list. Then they can then pick a reason from this "TOP 12".
1. I voted Democrat because I believe oil companies' profits of 4% on a gallon of gas are obscene, but the government taxing the same gallon of gas at 15% isn't.
2. I voted Democrat because I believe the government will do a better job of spending the money I earn than I would.
3. I voted Democrat because Freedom of Speech is fine as long as nobody is offended by it.
4. I voted Democrat because I'm way too irresponsible to own a gun, and I know that my local police are all I need to protect me from murderers and thieves.
5. I voted Democrat because I believe that people who can't tell us if it will rain on Friday can tell us that the polar ice caps will melt away in ten years if I don't start driving a Prius.
6. I voted Democrat because I'm not concerned about millions of babies being aborted so long as we keep all death row inmates alive.
7. I voted Democrat because I think illegal aliens have a right to free health care, education, and Social Security benefits, and we should take away the social security from those who paid into it.
8. I voted Democrat because I believe that business should not be allowed to make profits for themselves. They need to break even and give the rest away to the government for redistribution as the Democrats see fit.
9. I voted Democrat because I believe liberal judges need to rewrite the Constitution every few days to suit some fringe kooks who would never get their agendas past the voters.
10. I voted Democrat because I think that it's better to pay billions to people who hate us for their oil, but not drill our own because it might upset some endangered beetle, gopher, redheaded cockeyed woodpecker, or fish.
11. I voted Democrat because while we live in the greatest, most wonderful country in the world, I was promised "HOPE AND CHANGE".
12. I voted Democrat because my head is so firmly planted up my ass, it's unlikely that I'll ever have another point of view.
4b) Limbaugh on Buffett's Tax Evasion
Warren Buffett owes $1 billion in back taxes. He is fighting it. He doesn't think he should pay it, but publicly he's out there saying, 'I'm not paying enough in taxes'
Rush Limbaugh
RUSH: I think Obama's losing it, folks. I honestly think that there's a problem. Things have not gone as planned. The adulation -- and Obama is totally dependent on adulation, when you talk about these millionaires and their secretaries and other wealthy people who publicly support tax increases because it inoculates them from criticism. It keeps the people with pitchforks away. Warren Buffett doesn't worry about his house being stormed by people because he's out there, "Yeah, I make too much. Yeah, I don't pay enough taxes. Yeah, my secretary is getting ripped off." Oh, Warren, he's one of us. Meanwhile, Buffett owes a billion dollars in back taxes. Do you know that?
Warren Buffett owes $1 billion in back taxes. He is fighting it. He doesn't think he should pay it, but publicly he's out there saying, "I'm not paying enough in taxes." And people go, "Oh, Warren Buffett, man, he understands our plight. He is one of us." And so Warren Buffett's inoculated from any criticism. He doesn't have to worry about the poor storming his compound trying to take his property away from him or revolting against him. It's the same thing with Bill Gates. It's the same thing with all of them. It's the same thing with the Kennedy family.
4c)Subject: The Future Well-being of the U.S.
Obama…is he a good or bad President?
Should he be reelected?
(A reprint of an article written by Abe Bernstein on September 28, 2010 – Updated with the President’s latest decision and policies)
Foreign policy, national security , military readiness, fiscal management, economic growth… these are just some of the principal responsibilities of the President of the United States. How well has Obama performed in these arenas?
In foreign policy, he reached out to Iran in several speeches and was publicly mocked by Ahmadinidjad. Last year at the U.N., Ahmadinidjad made a speech accusing the U.S. of staging the 9/11 bombing! The administration called the Iranian UN Ambassador that afternoon and extended another invitation to talk about their nuclear weapons program! It is now 39 months of asking Iran to stop nuclear weapons development. They ignore our demands…they mock them…they use them to offer further “discussions” with the West…the latest to take place in Ankara. Economic sanctions have hurt Iran…but they have not deterred them from their core policy of making Iran a nuclear power and becoming the leader of the Islamist world. Obama has tied Israel’s hands with regard to any pre-emptive action in an attempt to stop the Iranian nuclear bomb. Iran has publicly declared they will destroy Israel. Obama disregards that threat. He made speeches and apologies to the Muslim world and appealed to the leadership of Arab nations to cease aid to terrorist organizations. The aid continues unabated. Iran has defied and mocked him, Syria has defied and mocked him. Iran continues to supply the roadside bombs which kill our kids in Iraq and Afghanistan.
Obama publicly and repeatedly pressured Israel to stop all settlement expansion. He then insulted and embarrassed the leader of America's only friend in the Middle East during Netanyahu's earlier visit to the White House. Netanyahu was made to enter the White House through the basement and no photographs or welcome dinners were permitted. He came and went like a criminal! These current peace talks hang on a thread over the settlements…not because of their relevance…but because Obama encouraged the Arabs to make an uncompromising demand or the talks are stopped. Obama has become the obstacle.
Obama unilaterally withdrew from an arrangement with Poland and Czechoslovakia for the positioning of anti-missile defenses against Iran. This was done in deference to Putin of Russia. Putin nevertheless continued to oppose sanctions of Iran and continued to trade with Venezuela ignoring Obama's appeals to stop. Poland and Czeckoslovakia have still not recovered from the reversal of a firm U.S. commitment by the U.S. Obama was caught recently offering Medvedev and Putin “more flexibility” in US positions once he gets re-elected. He tells the truth about his intentions to Russia but not to the US citizenry. Obama abandoned prior U.S. commitments to Russia's neighbors, Abkhazia and South Ossetia and allowed Russia to occupy them. The Ukraine, Poland, Azerbaijan, Armenia and Georgia were told by the Administration that this "reset" with Russia will not force the United States to sacrifice its influence or policies in the post-Soviet space.
China continues to defy U.S. demands regarding state subsidizing of the value of their currency giving them an edge in trade with the U.S. Obama continues to remain silent about their repressive internal policies. North Korea sinks a South Korean ship. The U.S. remained silent. North Korea has defied and mocked him. They now are preparing to launch an intercontinental missile which could reach the US with a nuclear warhead! All of Obama’s entreaties to North Korea have been ignored. Chavez of Venezuela has defied and mocked Obama and then reached out to Iran and North Korea.
China continues to defy U.S. demands regarding state subsidizing of the value of their currency giving them an edge in trade with the U.S. Obama continues to remain silent about their repressive internal policies. North Korea sinks a South Korean ship. The U.S. remained silent. North Korea has defied and mocked him. They now are preparing to launch an intercontinental missile which could reach the US with a nuclear warhead! All of Obama’s entreaties to North Korea have been ignored. Chavez of Venezuela has defied and mocked Obama and then reached out to Iran and North Korea.
As to national security, Obama ordered an investigation and possible prosecution of U.S. intelligence officers engaged in interrogation of captured terrorists. The threat of prosecution has caused more than thirty percent of career intelligence officers to retire! More than that, arrested terrorist suspects are now read their "Miranda Rights" before intelligence interrogations. He vowed to shut down Guantanamo. He tried to move the trial of 9/11 terrorists to a civil court in NY. He issued an Executive Order banning any form of pressured interrogation. He ordered that the phrase "muslim extremists" be stricken from the vocabulary of the government. He ordered the elimination of the phrase "war on terror" in government reports. He forbade the installation of airport procedures which would focus on travelers from Arab countries. Foreign intelligence services are now reluctant to share information with the U.S. The entire anti-terror apparatus of the U.S. has been politicized and directed to modify procedures which are "politically correct".
No friend of America can now rely on previously made U.S. promises because of Obama's reversals of prior commitments. He has not made the world safer, he has not made new friends for the U.S. and he has not sustained old friendships. His foreign policy, if it can be called policy, is an abject failure of mission, strategy and execution. America's historic position as "leader of the free world" is now a meaningless slogan of days gone by. As to military readiness, Army and Marine units in Iraq and Afghanistan are now on their fourth and fifth tours of duty! Not even in WW II did our soldiers have to serve such extended tours. Because of Obama's domestic priorities, military spending takes a back seat to his entitlement agenda. Our troops are short of armored vehicles, personal armored (bulletproof) vests, ammunition, supply vehicles and battlefield communications equipment. There are an insufficient number of combat brigades available due to lack of funding priority causing repeated tours of duty. It is a weakened military force, which if required in another theater, e.g., Korea, Iran, Somalia or South America would be hard pressed to respond!
As to fiscal management, essentially there is none! Federal spending is up in the stratosphere. Entitlement programs are added and expanded, the Federal headcount (number of employees who work for the federal government) has increased 150% under Obama. Medicare and Medicaid is expanded and fraudulent bookkeeping says it will save money! The Treasury borrows more money to pay for all these programs increasing US debt to levels which threaten our stability as a nation. We now owe 13 trillion dollars…that's $119,000 per U.S. taxpayer! The unemployment rate is stuck at the highest levels since pre-WW II . The government counts 14 million unemployed. There are 25 million actually unemployed! The government doesn't count you if you stopped looking for a job! There are 41 million Americans on food stamps. Our national debt is now 91% of our Gross Domestic Product! But Obama wants to increase taxes…and increase entitlement programs…that’s his solution!
Obama, however, continues to make speeches about the successful turn-around in the economy his stimulus spending has caused. He has no idea about how to manage the U.S. economy! But he does make a good speech…if there's a teleprompter in front of him. Tax the rich…give it everyone else…not in the form of investment incentives or job creating policies but in the form of entitlements. In the case of taxes, the Republicans aren’t much better. Perhaps Romney will now offer a rational reformation of our entire tax code.
Obama is campaigning. Obama is not governing. His two “accomplishments” are a failed stimulus and a 2500 page health care monstrosity about to be struck down by the Supreme Court.
Our enemies are stronger…our friends are weaker…the European economy is imploding. Our national debt is growing like an uncontrolled cancer. Obama has displayed a cavalier respect for the truth. His attacks on political adversaries ignore historical facts and his claims regarding his “accomplishments” are truly “fantastic”. He has reignited a divisiveness in our nation pitting black against white, the wealthy against the poor, the business owner against the worker.
So how would you rate President Obama? Is a good president or a bad president? Should he be re-elected? It’s your country…and it’s about the future for your children and grandchildren. It’s not about being a liberal or a conservative. It’s about being a rational citizen.
A. Bernstein
April 12, 2012
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5) Economist Gary Shilling:: Stocks to Drop 43 Percent, Plunging US Into Recession
The disappointing March jobs report is just the beginning of a decline in U.S. consumer spending that will tip the country back into recession, clobbering stocks and reviving the bond market, says investor A. Gary Shilling.
He sees not a short-term correction but a huge 43 percent decline for the S&P 500, and he predicts that 30-year bond yields will fall to 2.5 percent, while the 10-year Treasury could hit 1.5 percent.
“You’ve got the foreign earnings that don't look good because of recession unfolding in Europe, a stronger dollar, so they are translation losses. A hard landing in China. In the U.S., we could see a moderate recession led by consumer retrenchment,” Shilling told Bloomberg Television in an interview.
He predicts that S&P 500 operating earnings will come in at $80 per share, down from analysts’ estimates of more than $100 now. In a column, he goes on to state that the P/E ratio for the index could fall to 10 and that the index itself could fall to 800, from about 1,400, leading to a “massive bear market.”
In preparation, Shilling says he is long on U.S. debt, short stocks, short commodities and long the U.S. dollar.
The United States might look relatively good compared to the rest of the world (“the best horse in the glue factory,” Shilling says), but it is dependent on a consumer recovery that is increasingly hard to imagine, he contends.
The Labor Department last week said that the U.S. economy added just 120,000 new jobs in March after several months above the 200,000-job monthly pace.
The country is now in the longest stretch of high unemployment since the Great Depression, according to the Congressional Budget Office. A total of 12.7 million Americans are jobless, 40 percent of them over the long term.
Throw in consumer and student debt and the pressure to save for retirement, plus depressed home prices, and there’s just no gas in the engine for a recovery, Shilling argues.
“Incomes have simply not kept up. Of course, the real key behind that is employment. It looked earlier like jobs were picking up and that was going to provide the income and people would spend it, so on, so forth,” Shilling says. “But the employment report that we got last week throws cold water on that.”
It won’t take much more bad news to really slow things down, he warns. “If consumers retrench, there isn’t really anything else in the U.S. economy that can hold things up," Shilling says.
He says that even cash is better than stocks at this juncture. “Cash, although it does not pay anything, is an alternative. My 30-year favorite long Treasury bonds, I we're headed for 2.5 percent there,” Shilling says. "I think 1.5 is possible on the 10-year.”
A strong rebound in the bond market might give the Federal Reserve some breathing room. Some members of the Fed’s rate-setting committee have been warning that rates would have to rise sooner and faster than the market might expect.
Not Janet Yellen. The vice-chair of the central bank this week said that the late 2014 target for virtually zero interest rate is appropriate and hinted that a new round of monetary easing was possible.
"I consider a highly accommodative policy stance to be appropriate in present circumstances. But considerable uncertainty surrounds the outlook, and I remain prepared to adjust my policy views in response to incoming information," Yellen said a speech at New York University, cited by Reuters.
"In particular, further easing actions could be warranted if the recovery proceeds at a slower-than-expected pace, while a significant acceleration in the pace of recovery could call for an earlier beginning to the process of policy firming."
© 2012 Moneynews. All rights reserved.
5a)Mobius: Bernanke Still Has ‘Foot on the Pedal’ for More Easin
By Forrest Jones
inShare inShare2 The Federal Reserve has been officially silent on whether or not the economy needs fresh shots of extraordinary stimulus measures, although the U.S. central bank won't take steps to tighten anytime soon, says Mark Mobius, executive chairman of Templeton Emerging Markets Group.
The Fed has pumped trillions of dollars into the U.S. economy by buying bonds held by banks, a policy officially known as quantitative easing but dubbed by critics as printing money out of thin air.
The Fed has rolled out two rounds of easing since the downturn with the aim of steering the country away from deflationary spiral and encouraging hiring in the process.
Weak unemployment rates have markets whispering a third round may be on the way, which wouldn't be a problem either way, Mobius says.
Mopping up liquidity from past easing rounds would be a problem and would bruise stocks everywhere.
"The end of quantitative easing would not be a problem. It's if they decide to contract, in other words, decide to take money off the table — reduce the amount of money in circulation," Mobius tells CNBC.
"Then that would be a problem for everybody because, of course, there won't be enough money to move into the equities and bonds and other investments around the world. I doubt if that will happen, though."
Federal Reserve Chairman Ben Bernanke has repeated that conditions warranting accommodative policies will stick around through 2014.
"I think Bernanke still has got his foot on the pedal and wants to make sure that the unemployment comes down and that's true of other countries around the world," Mobius says.
"The Europeans, Japanese, Chinese — they still want to see good growth although they are cautious about inflation."
The Federal Reserve remains officially silent on the need for fresh easing, although some Fed officials say in their own opinion they recognize concerns that easing will pump up inflation rates down the road.
“I’m just reporting what I hear on the street, which is a real concern that with our expanded balance sheet, we are just a little bit in an ember of what could become an inflationary fire,” says Federal Reserve Bank of Dallas President Richard Fisher, according to Bloomberg.
Many business leaders are saying, “please, no more liquidity,” Fisher says.
Excess liquidity stemming from loose Federal Reserve policies tends to end up in emerging markets, stocks especially.
© 2012 Moneynews. All rights reserved.
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5) Economist Gary Shilling:: Stocks to Drop 43 Percent, Plunging US Into Recession
The disappointing March jobs report is just the beginning of a decline in U.S. consumer spending that will tip the country back into recession, clobbering stocks and reviving the bond market, says investor A. Gary Shilling.
He sees not a short-term correction but a huge 43 percent decline for the S&P 500, and he predicts that 30-year bond yields will fall to 2.5 percent, while the 10-year Treasury could hit 1.5 percent.
“You’ve got the foreign earnings that don't look good because of recession unfolding in Europe, a stronger dollar, so they are translation losses. A hard landing in China. In the U.S., we could see a moderate recession led by consumer retrenchment,” Shilling told Bloomberg Television in an interview.
He predicts that S&P 500 operating earnings will come in at $80 per share, down from analysts’ estimates of more than $100 now. In a column, he goes on to state that the P/E ratio for the index could fall to 10 and that the index itself could fall to 800, from about 1,400, leading to a “massive bear market.”
In preparation, Shilling says he is long on U.S. debt, short stocks, short commodities and long the U.S. dollar.
The United States might look relatively good compared to the rest of the world (“the best horse in the glue factory,” Shilling says), but it is dependent on a consumer recovery that is increasingly hard to imagine, he contends.
The Labor Department last week said that the U.S. economy added just 120,000 new jobs in March after several months above the 200,000-job monthly pace.
The country is now in the longest stretch of high unemployment since the Great Depression, according to the Congressional Budget Office. A total of 12.7 million Americans are jobless, 40 percent of them over the long term.
Throw in consumer and student debt and the pressure to save for retirement, plus depressed home prices, and there’s just no gas in the engine for a recovery, Shilling argues.
“Incomes have simply not kept up. Of course, the real key behind that is employment. It looked earlier like jobs were picking up and that was going to provide the income and people would spend it, so on, so forth,” Shilling says. “But the employment report that we got last week throws cold water on that.”
It won’t take much more bad news to really slow things down, he warns. “If consumers retrench, there isn’t really anything else in the U.S. economy that can hold things up," Shilling says.
He says that even cash is better than stocks at this juncture. “Cash, although it does not pay anything, is an alternative. My 30-year favorite long Treasury bonds, I we're headed for 2.5 percent there,” Shilling says. "I think 1.5 is possible on the 10-year.”
A strong rebound in the bond market might give the Federal Reserve some breathing room. Some members of the Fed’s rate-setting committee have been warning that rates would have to rise sooner and faster than the market might expect.
Not Janet Yellen. The vice-chair of the central bank this week said that the late 2014 target for virtually zero interest rate is appropriate and hinted that a new round of monetary easing was possible.
"I consider a highly accommodative policy stance to be appropriate in present circumstances. But considerable uncertainty surrounds the outlook, and I remain prepared to adjust my policy views in response to incoming information," Yellen said a speech at New York University, cited by Reuters.
"In particular, further easing actions could be warranted if the recovery proceeds at a slower-than-expected pace, while a significant acceleration in the pace of recovery could call for an earlier beginning to the process of policy firming."
© 2012 Moneynews. All rights reserved.
5a)Mobius: Bernanke Still Has ‘Foot on the Pedal’ for More Easin
By Forrest Jones
inShare inShare2 The Federal Reserve has been officially silent on whether or not the economy needs fresh shots of extraordinary stimulus measures, although the U.S. central bank won't take steps to tighten anytime soon, says Mark Mobius, executive chairman of Templeton Emerging Markets Group.
The Fed has pumped trillions of dollars into the U.S. economy by buying bonds held by banks, a policy officially known as quantitative easing but dubbed by critics as printing money out of thin air.
The Fed has rolled out two rounds of easing since the downturn with the aim of steering the country away from deflationary spiral and encouraging hiring in the process.
Weak unemployment rates have markets whispering a third round may be on the way, which wouldn't be a problem either way, Mobius says.
Mopping up liquidity from past easing rounds would be a problem and would bruise stocks everywhere.
"The end of quantitative easing would not be a problem. It's if they decide to contract, in other words, decide to take money off the table — reduce the amount of money in circulation," Mobius tells CNBC.
"Then that would be a problem for everybody because, of course, there won't be enough money to move into the equities and bonds and other investments around the world. I doubt if that will happen, though."
Federal Reserve Chairman Ben Bernanke has repeated that conditions warranting accommodative policies will stick around through 2014.
"I think Bernanke still has got his foot on the pedal and wants to make sure that the unemployment comes down and that's true of other countries around the world," Mobius says.
"The Europeans, Japanese, Chinese — they still want to see good growth although they are cautious about inflation."
The Federal Reserve remains officially silent on the need for fresh easing, although some Fed officials say in their own opinion they recognize concerns that easing will pump up inflation rates down the road.
“I’m just reporting what I hear on the street, which is a real concern that with our expanded balance sheet, we are just a little bit in an ember of what could become an inflationary fire,” says Federal Reserve Bank of Dallas President Richard Fisher, according to Bloomberg.
Many business leaders are saying, “please, no more liquidity,” Fisher says.
Excess liquidity stemming from loose Federal Reserve policies tends to end up in emerging markets, stocks especially.
© 2012 Moneynews. All rights reserved.
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