[QUOTE=xilman;303566]More on this one [URL="http://www.bbc.co.uk/news/business-18621354"]at the BBC[/URL][/QUOTE]And [URL="http://www.bbc.co.uk/news/business-18622264"]more.[/URL] Even more of that which promotes growth(*) hits the impeller.

Losing several per cent of your stock price may be regarded as a misfortune . Losing over 15% in a single day looks like carelessness.

Paul

(*) Hands up those who recognize that quote without having to Google it first.

[QUOTE=xilman;303603]And [URL="http://www.bbc.co.uk/news/business-18622264"]more.[/URL] Even more of that which promotes growth(*) hits the impeller.

< snip >

(*) Hands up those who recognize that quote without having to Google it first.[/QUOTE]I know! I know!

It's a reference to carbon dioxide, from some anti-AGWer.

[QUOTE=xilman;303603](*) Hands up those who recognize that quote without having to Google it first.[/QUOTE]

It sounds like a fertilizer-salesman analog of the same phrase for which the following Spoonerism bringing to mind a bad (imagined) joke about a Chinese epileptic could serve as a euphemism(+):

"When the Fit hits the Shan..."

-------

(+) My, that is some impressively tortured phrasing. And I didn't even have to lapse into Deutsch.

It'll be interesting and educational to see whether this author's prediction comes true:

"Obamacare and the coming Entrepreneurship Boom"

[url]http://smallbusiness.yahoo.com/advisor/obamacare-coming-entrepreneurship-boom-152751903.html[/url]

And in an amusing concatenation of bad news, today the FSA report on interest-rate swap mis-selling came out.

This was a remarkably daft episode where salesmen on commission at banks sold to small businesses deals labelled as 'if base interest rates exceed 6.5% you will only pay 6.5%', without pointing out the clause that, if base interest rates go below 4.5%, they paid something like 2% + 2*(4.5 - base rate). Barclays appears to have been a particularly vigorous seller of such deals.

Base interest rates were at 4.5% at the time and have plummetted since, leaving people with 9% and 10% mortgage rates.

(though I note that if I go to HSBC's business borrowing Web site and ask to borrow a million pounds to buy a lawyers' office it suggests I would be paying at least 8%)

[QUOTE=cheesehead;303631]It'll be interesting and educational to see whether this author's prediction comes true:

"Obamacare and the coming Entrepreneurship Boom"

[url]http://smallbusiness.yahoo.com/advisor/obamacare-coming-entrepreneurship-boom-152751903.html[/url][/QUOTE]
I predict a whole lot of "entrepreneurship" will be applied to evading and circumventing the coverage mandate. As for the long-term impact, I predict unexpected consequences up the wazoo - not all bad, mind you. Many will be of the similar flavor of "unexpected" practiced by academic economists, e.g. "whodathunk that giving away other people's money would lead to it being misspent?"

I predict most importantly that the main *expected* consequence, namely of increased healthcare affordability, will "unexpectedly" fail to materialize. When you engage in government-abetted price-fixing by cutting secret (at least they were at that time) [url=http://www.nytimes.com/2009/08/06/health/policy/06insure.html]backroom deals with Big Pharma[/url] which effectively guarantee their profit margins (minus a token one-time price-reduction in what they charge medicare & medicaid) as a quid pro quo for them to support the healthcare act, why would you expect any other result?

The irony is delicious, however - Obama continues to hotly deny that the individual-coverage mandate is "a kind of tax", rather that it's a penalty to "encourage" everyone to get covered. And the Act's language states the same. But Chief Justice Roberts, in his exercise in jumping through the constitutional-interpretation hoops needed to rule the individual-coverage mandate as constitutional, was only able to justify his ruling on the basis that what the legislation clearly states is a penalty is in fact ... a tax. You could not make this kind of stuff up if you tried.

----------------------------

Panic buying in the equity and Euro-currency markets today after the latest rumors of "incipient possible breakthroughs" (in the form of alleged no-questions-asked helicopter money drops for Spain, Italy and insolvent Eurozone banks) - Mish analyzes the latest [strike]pack of lies[/strike]news:

[url=http://globaleconomicanalysis.blogspot.com/2012/06/germany-blinks-after-all-night-fight.html]Germany Blinks After All-Night Fight; Italy and Spain Still Not Happy; For Now, Futures Are[/url]

[url=http://globaleconomicanalysis.blogspot.com/2012/06/laughable-text-of-eu-memorandum-of.html]Laughable Text of EU "Memorandum of Understanding"; ESM Not Been Ratified Yet Already Requires Changes; How Much ESM Firepower Is There?[/url]

The German papers, OTOH, are treating this as the latest in a long-running series of Merkel cave-ins after lines-drawn-in-the-sand (e.g. this week's "No Eurobonds so long as I live") - use Google Translate on the links, I have hand-translated just the title/subtitle of the 1st piece. Note that "red line" is the German analog for the English "line in the sand":

[url=www.welt.de/debatte/kommentare/article107305282/Dank-SPD-und-Gruenen-wurde-Merkel-erpressbar.html]Merkel succumbs to pressure with help of the SPD and Greens[/url]: [i]More money, fewer reforms: Angela Merkel has wiped away more red lines at the EU-summit. And the German Social Democrats helped actively to weaken Germany's position.[/i]

Apparently the first round of voting on the ESM in the Bundestag [url=http://www.welt.de/politik/ausland/article107298975/Sie-retten-die-Euros-der-Millionaere.html]has just begin[/url].

...and just after posting the above link, the article was updated to note that the Bundestag vote (2/3 required) passed: 491 aye, 111 nay, 6 abstentions.


[b]Friday Funnies:[/b]

[url=http://www.bbc.co.uk/news/world-europe-jersey-18579868]Roman and Celtic coin hoard worth up to £10m found in Jersey[/url]
[quote]"It [a hoard of roughly 50,000 Roman coins from the 1st century BCE] was found under a hedge so perhaps this is an early example of hedge fund trading”[/quote]

[url=http://imgs.xkcd.com/comics/moon_landing.png]XKCD: Moon Landing[/url]

[QUOTE=ewmayer;303676]
[b]Friday Funnies:[/b]

[url=http://www.bbc.co.uk/news/world-europe-jersey-18579868]Roman and Celtic coin hoard worth up to £10m found in Jersey[/url][QUOTE]"It [a hoard of roughly 50,000 Roman coins from the 1st century BCE] was found under a hedge so perhaps this is an early example of hedge fund trading[/QUOTE][/QUOTE]Yeah, I was bemused when I saw this. It is unusual for the BBC news to tell a joke like this. I think the unreality of all the financial high jinks is driving everyone batty.

/begin ot/
Well, not entirely ot. I'm posting this for Cheesehead.

In the beginning was the plan, and then the specification;
And the plan was without form, and the specification was void;
And the darkness was upon the faces of the implementers;
And they spake unto their manager saying:
"it is a crock of unmentionable, and it stinketh";
And the manager went to the 2nd level manager,
And he spake unto him saying:
"it is a vessel of fertilizer, and it stinketh";
And the 2nd level went to the 3rd level,
And he spake unto him saying:
"it is a vessel of fertilizer, and none may abide its strength";
And the 3rd level went to the division manager,
And he spake unto him saying:
"it aids plant growth, and none may abide its strength";
And the division manager went to the assistant vice president,
And he spake unto him saying:
"it contains that which aids plant growth, and it is very strong";
And the assistant vice-president went to the vice president,
And he spake unto him saying:
"it promoteth growth, and it is very powerful";
And the vice president went before the president,
And he spake unto him saying:
"this powerful new product will promote the growth of the company";
And the president looked upon the product,
And he saw that it was good.
/end ot/

The major "breakthrough" in recent EU talks re stabilizing the union revolve around the way money can be used to prop up weak economies. The gist is that the ESF will be used to buy govt bonds direct in an effort to spin the market in favor of the weak economy. The effect will be to "cap" interest rates so that borrowing costs stay under control.

DarJones

Update on the role Barclays - and now the BOE is been implicated as well - played the Libor-manipulation scandal (which has been semi-officially dubbed "Liborgate" or "Lieborgate", depending on which story you read), with typically hilariously tart commentary from the wits at ZH (underlines mine):

[url=www.zerohedge.com/news/bank-england-about-be-dragged-lie-borgate-and-which-us-bank-next]Is The Bank Of England About To Be Dragged Into Lie-borgate, And Which US Bank Is Next[/url]
[quote]If, and this is a big [b]if[/b], [u]the SEC does for once do something proactive in its illustrious career of corrupt, incompetent complacency and co-option, not to mention pornoholic hypnosis[/u], the next and final question becomes: will it be Bank of America, or JP Morgan... and just how will the market react to the knowledge that two of the world's biggest non-nationalized banks participated in what as many have been warning for years, the biggest market manipulation fraud in history.

Finally, if the BOE ends up getting crucified for Barclays' stunning email disclosure, will the Fed, which certainly had a role to play in all of this, be once again left untouched?[/quote]
The ZH comment "the biggest market manipulation fraud in history" is a reference to the fact that the Libor is used to set the pricing on no less $350 *trillion* in interest-rate sensitive products.

-----------

Update: Looks like [url=http://www.rollingstone.com/politics/blogs/taibblog/another-domino-falls-in-the-libor-banking-scam-royal-bank-of-scotland-20120629]RBS is next up to pay a relative-pittance fine[/url], which as Matt Taibbi notes is a perverse form of "justice" in this case:
[quote]The news that RBS is involved comes with a perverse twist. This is from the Times UK:
[i]
The bank, which is 82 per cent owned by the taxpayer, is preparing for a political firestorm over the affair because it believes that it has no power to claw back bonuses from the traders responsible. Instead, [u]the expected fines would be borne by the shareholders — largely the Government.[/u]
[/i]
Libor manipulation is a crime that already robs the public to create bonuses for bankers. By artificially lowering interest rates, the banks caused cities, towns, countries, and other public entities to receive smaller returns on their variable-rate investment holdings. If it turns out that taxpayers end up paying the fine for RBS's crime of robbing taxpayers, how perfect would that be?[/quote]

Also, I don't in any way believe the big US banks mentioned in the first piece as "relatively strong" based on their lower submitted rates were not also deeply involved - if anything they were merely more adept at the "if you're gonna lie, make it a whopper" game.

Mish [url=http://globaleconomicanalysis.blogspot.com/2012/07/email-from-lead-analyst-at-eia-on.html]has been closely following[/url] the economic and demographic trends which are, well, fueling, what appears to be a historic generational drop in US oil and gasoline consumption. This Reuters piece examines the demographic side of the equation:

[url=www.reuters.com/article/2012/07/01/us-usa-generationy-driving-idUSBRE8600BK20120701?feedType=RSS&feedName=domesticNews]America's Generation Y not driven to drive[/url]: [i]To Shoshana Gurian-Sherman, driving seemed like a huge hassle.[/i]
[quote]In her reluctance to drive or own a car, Gurian-Sherman is typical of a certain segment of Generation Y, the coveted marketing demographic encompassing the 80 million U.S. residents between the ages of 16 and 34.

Bigger than the post-World War Two baby-boom generation but without the middle-class expansion that drove the earlier group's consumer habits, Generation Y includes an increasing number of people for whom driving is less an American rite of passage than an unnecessary chore.

"That moment of realizing that you're a grown-up - for my generation, that was when you got your driver's license or car," said Tony Dudzik, a senior policy analyst of the Frontier Group, a California-based think tank that has studied this phenomenon. "For young people now, that moment comes when you get your first cellphone."
...
U.S. residents started driving less around the turn of the 21st century, and young people have propelled this trend, according to the federal government's National Household Travel Survey.

From 2001 to 2009, the average annual number of vehicle-miles traveled by people ages 16-34 dropped 23 percent, from 10,300 to 7,900, the survey found. Gen Y-ers, also known as Millennials, tend to ride bicycles, take public transit and rely on virtual media.

More than a quarter of Millennials - 26 percent - lacked a driver's license in 2010, up 5 percentage points from 2000, the Federal Highway Administration reported.[/quote]
And the trend looks set to accelerate as the boomers exit from active circulation:
[quote][u]At the same time, older people are driving more, researchers at the University of Michigan found. In 2008, those age 70 and older made up the largest group of drivers on the road, more than 10 percent, which was slightly higher than those in their 40s or 50s.
[/u]
The Michigan researchers offered a few reasons why some younger drivers hesitate to get behind the wheel: the high cost of owning, fueling and maintaining a car and the convenience of electronic communication.

The Frontier Group's Dudzik suggested a related cause: computer and smartphone applications that make taking public transportation easier, with minute-by-minute tracking of buses and trains and simple online maps and travel directions.[/quote]

Liborgate is gathering steam. Lawsuits are being filed, bank heads are rolling. I find this a bit refreshing since the banks weathered the last 5 years relatively unscathed. So is there anything at all surprising about the manipulation of Libor? No, nothing new, just another case of a huge bank exercising greed. They deliberately manipulated Libor down which means lots of investors received less on their investments than was their due. By knowing in advance that the rate would be kept artificially low, the investment arms of these banks could skim huge profits from their daily bread and butter i.e. mortgages, loans, and other commoditized investment vehicles. So what does this indicate for the future? The banks will be trying their best to sweep this under the proverbial rug or failing that to tie it up in court for a very long time. I don't think it it going to work. Look for more heads to roll at more major banks both in the U.S. and in London. Barclays is just the tip of this iceberg.


DarJones