5% fewer words, slightly shorter than last year but just as hope-full. From a hike (and inflation-indexed) in the minimum wage to a 140x multiplier of genome sciences investment (now that is Keynesian awesomeness); from extending homeownership (and refinancing plans) even more to energy independence; from Apple, Ford, and CAT's US Manufacturing to Bridge-Building and infrastructure spending; and from Trans-Pacific and -Atlantic Trade to cyber-security; it's all gonna be great - because as President Obama reminded us at the start... "Our housing market is healing, our stock market is rebounding," and this won't add a dime to the deficit... oh and that Student loan bubble - no worries, there's a college scorecard so now you know where to get the biggest bang for your credit-based buck. Summing it all up: Guns 9 : 3 Freedom ; Jobs 31 : 17 Tax ; Congress 17 : 40 Work ; Recovery 2 : 0 Unicorns ; Spending 3 : 2 Cutting
Back in December 2011 the US government first lied, then grudgingly had to admit that Iran had seized one of its RQ-170 Sentinel drones, which crash-landed in the middle of the country, after Iran released a video showing its scientists attempting to reverse engineer the contents of the drone. Naturally, the US politely asked for its drone back, and just as naturally, Iran politely refused to comply. So what was Iran doing in the intervening 14 months? Hacking the drone of course, which it finally succeeded last night when it released a short clip of what it had supposedly extracted from the remains of the Sentinel. The full clip is below, and while it does not provide any incremental informational benefits to Iran, or any further humiliation to whoever created the US drone fleet without a self-destruct option, it certainly will boost Iranian morale on the ground for hacking the Great Satan.
Following today's dismal GDP print, the massive ongoing borrowing being undertaken by our government, and the Bernankian policies which appear inescapable (and entirely ineffective for anything but the market), we thought Ken Rogoff's recent op-ed from the FT was extremely appropriate. Many foreign observers look at the US budget shenanigans with confusion and dismay, wondering how a country that seems to have it all can manage its fiscal affairs so chaotically. The root problem is not just a hugely elevated level of public debt, or a patently unsustainable trajectory for old age entitlements. It is an electorate deeply divided over the direction of government, with differences compounded by changing demographics and sustained sluggish growth. It is hard to escape the notion that today’s budget battles are but a skirmish in a much longer-term war that won’t be settled soon. The idea that one should just ignore all these problems and apply crude Keynesian stimulus is a dangerous one. It matters a great deal how the government taxes and spends, not just how much. The US debt level is a constraint.
The quest for cheap energy and cheap labor is a conquering human urge, one that has played out with notable ferocity starting with the Industrial Revolution. The introduction of coal into British manufacturing, and the more recent outsourcing of Western manufacturing to Asia, have marked key thresholds in this ongoing progression. But despite the harvesting of additional productivity gains from the more recent revolution in information technology, the suite of macro data suggests that the rate of advancement in physical production has slowed, notably, in the past thirty years. Seen in this light, the greatest gains to global industrial production were probably enjoyed from the late 18th century (when coal extraction and use began in earnest) into the mid-20th century (when oil reached broad distribution). In contrast, computers, the Internet, and the leveraging of developing world labor might eventually be seen as the finishing touches on this great industrial wave.
Netanyahu Deploys 'Syrian' Iron-Dome As Israeli Minister Claims US Preparing 'Surgical' Strikes Against IranSubmitted by Tyler Durden on 01/27/2013 22:00 -0500
Israeli PM Benjamin Netanyahu says his nation must prepare for the threat of a chemical attack from Syria, amid concern at enemy efforts to test a post-election coalition Israel, and has deployed its new Iron Dome anti-missile system near the border with its northern neighbor. Along with this concern, as many have perhaps suspected, the Israeli Defense Minister confirmed yesterday that the US has prepared plans for a 'surgical' military operation to delay Iran's nuclear program. As The Jerusalem Post reports, Ehud Barak, added that in the past the US has been heavy-handed but that under Barack Obama, the United States has "prepared quite sophisticated, fine, extremely fine, scalpels," if the worse comes to the worst - even though the Israeli preference would be to end the nuclear threat diplomatically, calling for tougher sanctions (though he expressed doubt that diplomacy would lead to success). Just another geopolitical hotspot that the world's markets choose to ignore in deference to the one true leader - central bankers.
Just because there is a superficially-pacifist, yet supraficially genocidal, dictatorially-inclined egomaniac in every one of us, the moment the Maisto Fresh Metal Tailwinds 1:97 Scale Die Cast United States Military Aircraft - US Air Force Medium Altitude, Long Endurance, Unmanned Aerial Vehicle (UAV) RQ-1 Predator went on loss at Amazon (we would say sale, but that would imply some probability of profit, which as even the hotdog guy, knows is never going to happen at AMZN), everyone scrambled to buy one. However, only those first in line got one: everyone else was greeted by a "Currently unavailable. We don't know when or if this item will be back in stock" sign. So what does one do: what one should have done in the first place before going for the one impulse purchase that can murder innocent children half way around the world courtesy of the latest iPad app "iKiller": read the customer reviews of course. Below is a broad sample of the rather bipolar main street America response when faced with the opportunity of having the same great power, if not so great - or any - responsibility, as is given, by some 25% of the population (factoring for the 55% or so who don't vote) to the president of the USA, even if on a 1:97 scale.
As Japan and China increase naval and air activity around the disputed Senkaku/Diaoyu islands in the East China Sea, the United States is steadily increasing its active involvement to reassure Tokyo and send a warning to Beijing. But Beijing may seek an opportunity to challenge U.S. primacy in what China considers its territorial waters. In this succinst summary, Stratfor analyzes the current state of affairs, the potential for escalation, and how the US' presence in the Pacific will play tactically and strategically into the evolving crisis over the Islands.
Well, my fellow Slope-a-Dopes, your selfless Idiotic Savant servant, whom is securely chained to his desk, has spent a significant part of the long weekend, perusing nearly every finance blog on the world wide web for you. Therefore, I can reliably report to the SOH, that the overwhelming consensus out there in the financial blogosphere, which has now reached a nearly universal feverish pitch, is boldly & proudly heralding that a most encouraging new economic dawn is finally upon us. It seems, a pristine permanent plateau of prosperity has been patently perfected.
"America has carried on not simply because of the skill or vision of those in high office, but because we, the people, have remained faithful to the ideals of our forebears and true to our founding documents.... The question we ask today is not whether our government is too big or too small, but whether it works -- whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified. Where the answer is yes, we intend to move forward. Where the answer is no, programs will end. And those of us who manage the public's dollars will be held to account, to spend wisely, reform bad habits, and do our business in the light of day, because only then can we restore the vital trust between a people and their government."
After witnessing the fighting of undeclared never ending wars, passage of freedom destroying legislation like the Patriot Act & NDAA, approval of pork barrel spending to the tune of hundreds of billions, rule by Executive Order, using ZIRP to extract hundreds of billions from senior citizen savers and give it to criminal Wall Street banks, forcing the American people at gunpoint to replenish the Wall Street banks with $700 billion after they had committed the greatest financial fraud in history, and a continuing trampling of the U.S. Constitution, the American people continue to remain willfully ignorant of the truth. The American Dream is dead. We’ve allowed a rich, privileged, elite few to achieve hegemony over our economic and political system with their control of the media and manipulation of our financial markets. They will collapse the country because they will never be satisfied with the amount of wealth and power they’ve accumulated. Their voracious greed will be their downfall.
Military Recruits Young People Through Misleading First-Peson Shooter Games
Some discoveries are exciting, joyful, and exhilarating, while others can be quite painful. Stumbling upon the fact that you do not necessarily have a competent grasp of reality, that you have in fact been duped for most of your life, is not a pleasant experience. I came to see a dark side to the Democratic Party that had always been there but which I had refused to acknowledge. During the rise of any despotic governmental structure, there is always a section of the population that is given special treatment, and made to feel as though they are “on the winning team”. For now, it would appear that the “Left” side of the political spectrum has been chosen by the establishment as the favored sons and daughters of the restructured centralized U.S. However, before those of you on the Left get too comfortable in your new position as the hand of globalization, I would like to appeal to you for a moment of unbiased consideration. I know from personal experience that there are Democrats out there who are actually far more like we constitutionalists and “right wing extremists” than they may realize. I ask that you take the following points into account, regardless of what the system decides to label us...
With impeccable timing.
The punchlines: "...the issue here is whether or not America pays its bills. We are not a deadbeat nation... And if the Republicans in Congress have made a decision that they want to shut down the government in order to get their way, then they have the votes, at least in the House of Representatives, probably to do that.... So we've got to pay our bills. And Republicans in Congress have two choices here. They can act responsibly, and pay America's bills, or they can act irresponsibly and put America through another economic crisis. But they will not collect a ransom in exchange for not crashing the American economy ... We've got to stop lurching from crisis to crisis to crisis when there's this clear path ahead of us that simply requires some discipline, some responsibility, and some compromise. That's where we need to go. That's how this needs to work.".... Yet should the "worst" (i.e. living within its means) happen to the US, then "Social Security checks, and veterans benefits will be delayed. We might not be able to pay our troops, or honor our contracts with small business owners. Food inspectors, air traffic controllers, specialist who track down loose nuclear materials wouldn't get their paychecks. Investors around the world will ask if the United States of America is in fact a safe bet. Markets could go haywire, interest rates would spike for anybody who borrows money. Every homeowner with a mortgage, every student with a college loan, every small business owner who wants to grow and hire.... As the speaker said two years ago, it would be, and I'm quoting Speaker Boehner now, "a financial disaster, not only for us, but for the worldwide economy.""
Still think "we are not a deadbeat nation"?
As reported over the weekend, late on Friday French forces launched a military campaign, consisting primarily of airforce incursions, designed to crush the "Islamic extremists" in the country in order to protect "European interests" (it is unclear what these may be). Parallel with this came the first humiliation for French military forces as a French helicopter pilot was killed nearly at the same time as the offensive was launched. But even more embarrassing was the bungled attempt to rescue a hostage in Somalia, in which the hostage is said to have died (by France at least, not his captors), while at least one French commando is also reported to have been left behind. Moments ago, AP reported on the latest French military developments in Mali, which confirm that when it comes to the words "French military" and "success" will hardly ever be seen side by side. To wit: "Despite intensive aerial bombardments by French warplanes, Islamist insurgents grabbed more territory in Mali on Monday and got much closer to the capital, French and Malian authorities said. In the latest setback, the al-Qaida-linked extremists overran the garrison village of Diabaly in central Mali, France's defense minister said in Paris. Jean-Yves Le Drian said Monday the rebels "took Diabaly after fierce fighting and resistance from the Malian army that couldn't hold them back." In other words, "before France sent its forces in on Friday, the closest known spot the Islamists were to the capital was 680 kilometers (420 miles) away"... while "by now sweeping in from the west, they are now only 400 kilometers (250 miles) from Mali's capital, Bamako, in southern Mali." Yet another French military campaign stupendously executed.