Florida

With less than 20 days to go to the election, the Presidential race has tightened following Romney's performances in the debates, as the Republican challenger has overtaken the president in the national averages for the first time this year (and RealClearPolitics has him with an edge in the electoral college also). But ever the fair-and-balance bank, Citi believes that Obama's advantages remain substantial, as an incumbent president in an improving economic environment. In this broad discussion, the Pandit-less bank addresses 'the data' driving their Obama call, what would have to happen for a Romney win, the Senate and House split, The Tea Party (and other unusual events), and the 'bungee jump'-causing headline risk of the pending Fiscal Cliff debate. Everything you need to know about the election-critical states, players, and events (and who would win in a fist-fight), but were afraid to ask Wolf Blitzer.

For the majority of Americans living along the country's coastlines, anything that is not within 50 miles of the the big water is pejoratively called "flyover states", its contents to be avoided at all costs, and its contributions to society and the economy to be loudly mocked and jeered at high society cocktail parties from the Hamptons to Malibu and back (but not inbetween). That is, until election time. Because when it comes to determining the fate of America's leadership every 4 years, the bankers, lawyers, venture capitalists, socialites, marketers, hedge funders, Economist PhDs, and other very important jobs, courtesy of the Electoral College, have absolutely no impact, and it all boils down to such swing states as Ohio, Florida, Iowa and Nevada. For the full cartoon presentation of what states do matter this election, see the cartoon below.

BP’s Explanation Is Incorrect

While last night's VeeP debate was all feces and frolics, UBS' Art Cashin and his 'Friends of Fermentation' recently drifted onto the topic of the Presidential Election - and the conversation was not what he calls "reassuring" as they move from margins of victory to result-challenges and banana-republic like street demonstrations and riots. The heart of this discussion is the acrimonious tone that has evolved and grown in our political exchanges. All the "us and them" and class warfare posturing sets a dangerous backdrop to a close election.

One-year "money" is offered at .9750. The .9700 bid is vulnerable. I don't get it.

A month ago, when RealtyTrac posted their latest US foreclosure numbers for the month of August, we presented what we called was the "Foreclosure Stuffing" thesis, explaining the explicit subsidy by the banks for the housing market, whereby the entire foreclosure process has now ground to a halt, and in doing so removing millions in inventory flow from the distressed end market, forcing limited buyers to chase what supply there is, and in the process boosting prices of existing inventory higher. In other words a traditional inventory removal-based subsidy. It is therefore not surprising that today RealtyTrac reported the latest foreclosure data, and lo and behold, just as we expected, the great foreclosure collapse has taken another leg lower, with the total number of foreclosures for the month of September sliding to 180.4K, a decrease of 7 percent from the previous month and down 16 percent from September 2011, and the lowest in five years!

• Global easing deluge resumes: Bank of Korea Slashes Policy Rate (WSJ)
• And Brazil: Brazil cuts Selic rate to new record low of 7.25 pct (Reuters)
• With Tapes, Authorities Build Criminal Cases Over JPMorgan Loss (NYT) Just don't hold your breath
• IMF snub reveals China’s political priorities (FT)
• Add a dash of trade wars: Revised Duties Imposed by U.S. on Chinese Solar Equipment (Bloomberg)
• IMF calls for action as euro zone crisis festers (Reuters)
• Dubai Losing Billions as Insecure Expats Send Money Abroad (BBG)
• Softbank in Advanced Talks to Acquire Sprint Nextel (WSJ)
• Lagarde calls for brake on austerity (FT)
• EU lambasts Turkey over freedoms (FT)
• Race Tightens in Two States (WSJ)

Slap one out of 1000 bankers on the wrist and make millions of muppets happy???

Spoiler Alert: They’re mostly still in office  (so much for building suspense).

On October 3, 2008, 338 elected officials (263 House reps, 74 Senators and 1 President) took it upon themselves to save America from certain financial doom by passing the Emergency Economic Stabilization Act of 2008, completely ignoring the will of the American people,  opting instead to fulfill a Thomas Jefferson prophesy:

“The end of democracy and the defeat of the American Revolution will occur when government falls into the hands of lending institutions and moneyed incorporations.” 
~ Thomas Jefferson

26 times the GDP of Vermont!

America Was Founded on Courage ... What Hapened?

Most people know that during this year's Coachella festival, Tupac made a surprising appearance, if not in the flesh for obvious reasons, then in hologram form. What fewer people know is that the firm that created Holo-Tupac is special effects producer Digital Domain Media, which after years of failed attempts to do so, finally went public in November with Roth Capital as underwriter (there is now an Urban Dictionary definition for 'Rothed') at a price of $8.50 (well below the preliminary range of $10-12/share) and at a time when its burn rate was well above 50% of revenues, and which filed for bankruptcy hours ago. In other words, the company destroyed over $400 million in market cap in under 10 months. What is known by very few is that this is yet another public equity disaster of this administration: as filed in the bankruptcy Affidavit, "the Company has worked closely with State and local government authorities in Florida to execute economic stimulus contracts designed to create jobs and stimulate Florida’s economy. As of the Petition Date, the Company had contracted to receive a total of approximately $135 million in such government stimulus financing, including $19.9 million in tax credits. This financing consists of cash grants, land grants, low-interest financing, and tax incentives." In other words, in addition to the government's remarkable track record in the alternative energy field, public equity is now in the digital movie studio subsidization business. End result: bankruptcy, of a publicly funded company, shortly after IPO and sadly the realization that US capital markets are now so broken that the combination of private and public funding can sustain a company for less than one year.

• Germany says U.S. debt levels "much too high" (Reuters)
• Netanyahu ramps up Iran attack threat (Reuters)
• Burberry plummets by most ever, slashes guidance, rattles Luxury-Goods Industry as Revenue Growth (Bloomberg)
• FoxConn Again Faces Labor Issue on iPhones (NYT)
• Southern whites troubled by Romney's wealth, religion (Reuters)
• China's Xi not seen in public because of ailment (Reuters)
• Another California muni default: Oakdale, Calif., Restructuring Debt, Planning Rate Raise After Default (Bond Buyer)
• Spain's PM expects "reasonable" terms for any new aid (Reuters)
• Bernanke Proves Like No Other Fed Chairman on Joblessness (Bloomberg) - Ineffective like no other?
• John Lennon’s Island Goes on Sale as Irish Unpick Property Boom (Bloomberg)

I was recently interviewed by a journalist for a local newspaper who was developing a story on the exponential rise of the “prepper lifestyle” in America, most especially in Western Montana.  Being an outsider to the Liberty Movement, she was naturally curious as to what motivated us to make what some in our culture would see as a drastic and bewildering leap away from the mainstream.  She was equally fascinated with our willingness to travel great distances and make substantial sacrifices to live in regions like the American Redoubt.  I will not deny, Montana has indeed become a “hotbed” of survivalism and Constitutionalism, or what the Southern Poverty Law Center would call “extremism and domestic terrorism”.  I lived in Pittsburgh for years while writing for Neithercorp and Alt-Market and rarely ran into like minded individuals aware of the tenuous status of our society.  Within days of moving to Montana, I was being recognized by complete strangers in supermarkets excited to discuss the inner workings of Keynesian monetary corruption, precious metals investment, and Alinsky disinformation tactics.  Yeah…I know…it’s weird. After living for a while in the Redoubt, you begin to forget that there are still many people in this country that are utterly oblivious to the epic dangers around them, as well as painfully helpless in knowing what to do when those dangers land on their doorsteps.  Speaking with the newspaper reporter, and my experiences at Paulfest in Tampa, Florida, reminded me that the world has yet to be reminded of the value of survivalism.  There is still a gap, a disconnect, a psychological twitch of the masses, and it compels me to explain, yet again, what they are missing.

Since the best theater is that whose 100% assured outcome is not absolutely obvious, Reuters/Ipsos is happy to advise the 47% or so of American eligible voters who will actually participate in the upcoming presidential election that following the GOP convention, Hurricane Issac and the Invisible Obama, Romney has managed to cut Obama's 4 point lead and is now neck and neck with the incumbent. From Reuters: "President Barack Obama enters an important campaign week tied with Republican presidential nominee Mitt Romney, a Reuters/Ipsos poll found on Sunday, leaving the incumbent an opportunity to edge ahead of his opponent at the Democratic National Convention. With the Democrats set to nominate Obama for a second term this week in Charlotte, North Carolina, the race to the presidential election on November 6 is all knotted up at 45 percent for Obama and 45 percent for Romney among likely voters, the survey found." Of course, this being America, all that is needed is for the Democrats to invite Jason Biggs to deliver the Eastwood counter, and Obama's victory will be assured.