Archive - Apr 2011

Following weeks and months of lies that Portugal does not need a bailout, that is is not Ireland, Greece, Algeria, Tunisia, Egypt, Middle Earth, Uranus, etc, the country finally realized it is bankrupt, unless it comes, hat in hand, bagging for a bailout from Jean Claude Trichet (who now is scratching his head how to spin this latest sovereign default as bullish ahead of tomorrow's rate hike). Which it just did. Reuters has compiled the reactions by those who felt like sharing their views on this foregone conclusion.

Does anyone remember the TELE-POTUS 2008 election blathering about his fine credentials with regard to the economy? Man were we gullible! After we sort out the difference between inflation and hyperinflation, can we all please remember to haul Obamo the Billion Dollar Clown to the Election Day carpet?

Or how in kleptocratic America, wealth effect poverty effects you.

World Bank president Robert Zoellick is currently speaking live on Reuters Newsmaker, and is discussing numerous topics related to the future of the monetary system, notable among them most likely being the fate of the dollar, and whether or not he still stand behind his recent statement that a return to the gold standard is needed for the world.

One of the sad side effects of the recent record in food stamp participation is that apparently the 44.2 million Americans who now subsist below the poverty line and rely on the government for basic food needs, have become quite a drag on otherwise insolvent state and local governments. And with monthly increases projected to keep rising in line with the Russell 2000 as the Wealth Effect is constrained to Wall Street, and no end in sight to the Poverty Effect, states are getting nervous. Never fear: the US taxpayer is here. In a press release, the USDA has just announced that it "will award grants to improve access to and increase participation in the Supplemental Nutrition Assistance Program (SNAP). The grants are for state and local governments and private non-profit organizations to develop projects that simplify SNAP application and eligibility systems and find efficiencies in the administration of the program with the goal of providing critical nutrition assistance to those in need." Translation: the Fed is about to add the bailout if the Food Stamp program to the infinite list of subsidies that rely exclusively on the generosity of Vassarionovich-Packard.

Congress, you need to wake up. The people who are acting as your financial advisors are lying to you about the economy and our financial system. They’re also lying to you about the effectiveness of their policies. You are supposed to represent us. You are supposed to defend us against threats both internal and external. Bernanke is lying to you and all of us. He is an internal threat to our financial wellbeing.

DO SOMETHING ABOUT IT.

New story, old story. Same story.

Update: It's Official. Portugal is Bankrupt:  Portuguese finance minister says the country will have to use European Union mechanisms to resolve its debt problems, to make announcement at 8PM.

In the biggest shocker to come out just hours before the ECB's announcement tomorrow, which many see is a guaranteed rate hike, Journal de Negocios has just announced that according to the Portuguese Finance Minister, the country needs a bailout, after weeks and weeks of Greece-style denials. And yes, nobody could have foreseen this, and all that jazz.

• *DJ Obama Admin Says IRS Would Shut Down If Budget Not Passed
• *DJ Obama Admin Says National Parks, Smithsonian Would Close
• *DJ Obama Admin: Cherry Blossom Festival Wouldn't Happen If Budget Not Passed
• *DJ Obama Admin: Roughly 800,000 Govt Employees Would Be Affected By Shutdown
• *DJ Obama Admin: EPA Permitting Would Stop If Budget Not Passed
• *DJ Obama Admin: Social Security Beneficiaries Would Continue To Receive Payments
• *DJ Obama Admin: Electronic Tax Refunds, Collections Would Continue
• *DJ Obama Admin: Military, Law Enforcement Will Continue To Function
• *DJ Obama Admin: Military Personnel Would Earn Paychecks, But Not Receive Them Immediately
• *DJ Obama Admin: White House Staffing Would Be Lower During Shutdown
• *ZH: POMO will continue come rain or snow: Russell 36,000 will not be denied, US bankruptcy notwithstanding

In order to make the biggest strawman so far in 2011 really scary and nasty, the administration just announced that as part of a government shut down, the IRS would end up being closed. While according to some this is the ulterior motive all along to avoid the premature outflow of tens of billions in cash due to federal tax refunds hitting the IRS next week, which without a debt ceiling hike would push the country into technical default possibly as soon as next week (debt subject to the limit was $14.2 trillion two days ago, just $94 billion under the ceiling and with about $74 billion in debt to be issued next week a $20 billion tax refund withdrawal would push the Treasury over the limit), what is far more amusing is that as the WSJ reminds us, the Fed would still be able to monetize debt regardless if the government was operating or not. Ergo nothing can end POMO ahead of time, not even a complete US government shutdown.

RANsquawk US Afternoon Briefing - Stocks, Bonds, FX etc. – 06/04/11

RANsquawk US Afternoon Briefing - Stocks, Bonds, FX etc. – 06/04/11

RANsquawk US Afternoon Briefing - Stocks, Bonds, FX etc. – 06/04/11

RANsquawk US Afternoon Briefing - Stocks, Bonds, FX etc. – 06/04/11

RANsquawk US Afternoon Briefing - Stocks, Bonds, FX etc. – 06/04/11