PARIS (AP) -- All countries that use the euro should have mandatory balanced budgets and better coordination of economic policy, the leaders of France and Germany said Tuesday, pushing for long-term political solutions instead of immediate financial measures like a single European bond.Ahh, don't you just love it when two people meet and decide the fiscal fate for millions? It's almost as if epistemological fallacies don't exist! This balanced budget talk is all nonsense in the end, every country's budget ends up balanced through money printing or borrowing. Not to delve to much into conspiracy theory, but this just screams new world order:
French President Nicolas Sarkozy and German Chancellor Angela Merkel also pledged to harmonize their countries' corporate taxes in a move aimed at showing the eurozone's largest members are "marching in lockstep" to protect the euro.
Sarkozy told reporters that he and Merkel want a "true European economic government" that would consist of the heads of state and government of all eurozone nations.And here is the frosting to top the whole Euro-baked cake off:
The new body would meet twice a year -- and more in times of crisis -- and be led initially by EU President Herman Van Rompuy for a 2 1/2-year term. After that, Sarkozy suggested, it could be opened up to other heads of states and government.
The move appeared a step toward the closer long-term economic integration that many analysts have said is inevitable to make the euro experiment survive, though it was unclear how much effect it would have in the short term.
U.S. stocks fell, following the biggest three-day rally for the Standard & Poor’s 500 Index since 2009, as French President Nicolas Sarkozy said his nation and Germany will propose a financial transaction tax.Hmmm, remember my summarizing this Doug Casey interview?
To sum it up, Casey basically warns that U.S. citizens should begin diversifying their financial portfolio internationally. Casey and Rockwell both predict another Depression coming which will have high bouts of inflation rather than deflation that carried on through the Great Depression. It will all be followed by another war of course. Now rather than the federal government swooping in and confiscating gold during the Depression, Casey is worried more about financial controls being implemented that keep capital within the U.S. Frankly, this type of prediction is not at all farfetched.Looks like financial controls just aren't coming to the U.S. Whatever this financial tax turns out to be, look for the bankers to benefit.
Today Gary North asks the right questions to summarize the Euro sideshow today perfectly:
Why didn't all the previous meetings solve the economic problem of PIIGS debt?North should know by now that asking pertinent questions like these never lead to results. Expect more "emergency" meetings by Euro leaders as they slowly dissolve any sense of sovereignty each country has left.What public relations statement do they expect will bring financial stability to the PIIGS?What new program will they suggest, only to be disavowed as impractical by the European Central Bank, and then adopted a week or two after the official denial?What program will they ever submit to their respective parliaments, to be debated openly in front of voters? None, you say? I see. Just like before.What opportunity will voters in France and especially Germany be given to express their view of the new program? None, you say? I see. Just like before.What indication will investors see that there is any new program that is not merely another Band-Aid?What program, other than more deficit spending by France and Germany to lend more money to the PIIGS, will ever come forth from one of these meetings?What solution, other than more purchases of the IOUs of PIIGS bonds by the ECB, will ever be presented?What will they ever suggest, other than more of the same?What evidence will ever be presented that the latest round of more of the same will not be followed in a few weeks and months and years by even more of the same?
Key in point: last Thursday, short selling was banned in Italy, France, Belgium, and Spain as the European Securities and Market Authority once again predicted financial calamity. Damn those dastardly financiers trying to protect their wealth! John Tamny does a great job today taking on the idiotic notion of banning short selling to quell financial panics:
As evidenced by their violent fluctuations over the last two weeks, stock markets in Europe and everywhere else have a crisis quality to them, thus making the existence of short sellers ever more necessary. Indeed, if they didn't exist, we'd have to invent short sellers precisely for times like the present.
...short selling is often part of a long buying strategy. No doubt there are shares of healthy French and Italian companies that investors find attractive right now, but as a way of protecting their downside, some investors surely want to short the shares of correlated, seemingly less healthy companies as a way of covering their losses assuming their long position proves incorrect.
Thirdly, and perhaps most importantly, it must always be stressed that short sellers are ultimately buyers. To sell shares short, an investor must go into the marketplace to borrow shares from an existing shareholder, then sell them.All banning short selling does is prolong the reallocation of goods and capital to more profitable and efficient enterprises. Like printing off funny money and running large fiscal deficits, banning short selling prolongs the downturn, doesn't cure it. As Tamny writes, "How nice it would have been then to have short sellers who, after profiting from those dives (and aiding the economy in the process), would have re-entered the stock market to put a floor under falling prices."
How nice indeed it would have been for bureaucrats to cease from "doing something" and let the market run its course.
So after all the outcry of the media ignoring Ron Paul following his almost upset victory, John Stewart does a fantastic job skewering the mainstream media for pretending Ron Paul was invisible:
Fox News loves warmongers, no real news there. Still, it was great to see Paul getting some much needed attention finally. All day today the 24 hour news networks broadcasted the fact that they ignored Paul, as if they didn't themselves contribute to the idiocy. Good job news media, good job.
Paul weighs in today on Fox News of all places:
For some cheering up, check out this hilarious scam:
Ha! Though this is blatant fraud, I can't help but laugh as Paulson committed fraud on the whole nation through TARP. For even more hilarity, check out the laser pistol-toting Rick Perry threatening Bernanke:WASHINGTON -- A Maryland man is under investigation for allegedly wiping away his $353,000 mortgage debt by convincing financial giant CitiGroup to accept a money order purportedly backed by then-Treasury Secretary Hank Paulson, FOX News Channel reported Tuesday.According to court documents filed in the case, 35-year-old Bryan Gardner of Waldorf, Md., sent CitiMortgage a $353,000 money order in January 2009 and indicated that it would be his final payment for a property in nearby Bowie, Md.
Treason? Yes. Does Perry really get it? I seriously doubt it, but it's nice to see him try.
I will end with a few new signs of a possible inflation-induced boom coming America's way. First is via CNBC:
U.S. housing starts fell less than expected in July as builders broke ground on new multifamily units likely to meet demand for rental apartments, while permits for future construction dropped.
The Commerce Department said on Tuesday housing starts slipped 1.5 percent to a seasonally adjusted annual rate of 604,000 units, but above economists expectations for a 600,000-unit pace.
Compared to July last year, residential construction was up 9.8 percent.It's always tough to judge if the housing market has cleared, but I never get tired of seeing the phrase "more than expected" or "less than expected." Whether this means that mainstream economists can't predict the velocity of money printing or they are just plain moronic when it comes to business cycles, I don't know. There seems to be two opposing stories right now, either we are entering an inflationary boom that will surely bust or we are treading right back toward deflation. The former seems plausible judging by this new Rasmussen report:
Prior to the latest survey, overall confidence in the Fed to handle inflation and interest rates ranged from a low of 32% to a high of 41%. The number who hold no confidence at all is now at its highest level in nearly two years.Rasmussen is typically known as a conservative source, so Krugman will just deny the results as usual. It does leave one wondering though.This lack of confidence stems partly from the fact that 93% of adults report paying more for groceries now than they did a year ago, the highest finding to date. Only four percent (4%) say they’re not paying more for groceries now compared to a year ago. Prior to the latest results, the number that said they are paying more for groceries ranged from low of 75% in April 2010 to a high of 91% in May of this year.
For a little fun, check out this handy interactive map on whether you should buy or rent housing in many popular U.S. cities:
Click the pic to link to graph. From the looks of it, Nevada and Arizona's housing market may have hit its bottom at this point.
Update- More proof of an inflationary boom?
A new building for my bank was just put up in my hometown, a business I believe called Zack's just moved into the space Blockbuster left a few months ago, and a shopping center near the Harrisburg International Airport just had huge infrastructure renovations done to the entrance from the road. Seems like progress to me.
I can't help but post this great graphic:
Update 2- Kudos to Jack Cafferty for this brilliant line:Update- More proof of an inflationary boom?
I can't help but post this great graphic:
"Michele Bachmann has no chance of being the next president of the United States, maybe Ron Paul should be."The hype around the mainstream media's complete disregard of Paul on Sunday is in full force. Whether it lasts will remain to be seen, but one thing is for sure, people are seriously starting to pay attention.
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