Global Economy Bursting?

[Restrain]

If we're not drilling off the coasts, and if the EPA shuts down fracing, we won't be producing ANY oil or gas. PERIOD. Then watch prices go up.

Sorry but the EPA and other government agencies have become our greatest enemies in terms of economic recovery. Government regulations and the unions have driven out the manufacturing to overseas, and now they want to make us totally dependent on Saudia Arabia (which funds Al Queda) for our oil. What's wrong with that picture!?

 

[Randolph Kinney]

Millions Bracing for Cutoff of Unemployment Aid

http://www.nytimes.com/2010/12/04/us/04unemployed.html?_r=1&nl=todaysheadlines&emc=a23

By the end of December, more than 2 million people will lose their extended benefits and 1 million more by the end of January. Next year, it is expected that unemployed people will lose their benefits after 6 months, which is the normal length of time for benefits.

There is growing pressure to extend the 99 weeks of unemployment benefits however, it is being used as a bargaining chip in the lame-duck session.

Will the people who are unemployed and with out benefits rise up? See below for states most effected.

 

[Austin]

Randolph: The answer to your question is-no the people will not rise up because there is nothing to rise up against. This issue just creates a wall between the haves and the have nots. This is the new norm and the 15 million unemployed will just serve to keep wages down.
Having said thats, benefits will not be cut off. Congress will just say they are taking the money from cuts in fraud and waste yada yada yada...... We willl probably add +100,000 new jobs in December and in January the unemployment rate will be 10%.

 

[Terrel L. Shields]

EIA expects the price of ...crude oil to average ... a $5.50-per-barrel increase over last winter ... EIA's forecast assumes U.S. gross domestic product (GDP) grows by 2.6 percent in 2010 and 2.2 percent in 2011, ....

Energy is different. It does not change "gradually"...it jumps in fits and starts.

Three things are working against us.
A. - by not embracing the Pickens Plan and not giving an incentive for people to convert cars to natural gas, you have created a disconnect between oil and gas pricing. Oil has 10x the BTU content in a bbl. as gas has in 1,000 CU. Ft. but is currently priced at 25 x the cost of nat gas. Reducing oil consumption in autos can only come by using nat gas to fuel cars.
B. - QE2 and the future QE3.. a. k. a. - The Bernanke Put - will deflate the dollar. Oil is denominated in dollars...which explains in part that disconnect in pricing above. This will get worse as the dollar weakens. If the Euro strengthens, it will get even worse... as is, the dollar and Euro are both falling...just at slightly different rates.
C. - The disaster in the Gulf has led to a dramatic reduction not only in deep drilling in the Gulf but in shallow drilling. Our domestic oil reserves are falling like a rock. We get a lot of oil from Canada and their currency is stable...again, the balance is driving up the cost of Canadian crude. And now they are trying to throttle all drilling in the Rockies (and Salazar is doing a darn good job of it by cancelling leases as a recent court ruling went against him, but the leases stayed cancelled because the oil companies didn't realize they had to file in court within 90 days...they waited 4 months.) We are trying to stop fraccing. We are trying to stop coal production. In short, we are doing every positive thing we can to reduce domestic energy production....and the consequences of $110 a bbl oil (i would not be surprised we'll see by May) will be that dreaded "double dip" and an increase in unemployment to above 10%...without a doubt....and the Republicans will be blamed for the higher oil prices ["see, everytime we elect a Republican congress, oil prices go up.."]

 

[Randolph Kinney]

As long as the benefits are preserved, there won't be any rising up. However, the political points are being made today, Saturday, in the Senate where they will vote to extend the tax rates only for the middle-class with Build America Bonds extended and other benefits. The two versions are expected to fail. Next week will be the serious negotiations for extending all the current tax rates with some benefits added in.

There is no incentive to find work and if people are seriously looking for work, most of the jobs created are low paying. Here are the details of Friday's job report:

• Payrolls increased 39,000, less than the most pessimistic projection of economists surveyed by Bloomberg News, after a revised 172,000 increase the prior month, Labor Department figures showed today in Washington.
  
• The jobless rate rose to 9.8 percent, the highest since April, while hours worked and earnings stagnated.
  
• Overall payrolls were forecast to climb by 150,000, according to the survey median, with estimates ranging from 75,000 to 200,000.
  
• Manufacturing payrolls dropped by 13,000 in November, the most in three months. Economists had projected an increase of 5,000.
  
• The report also showed an increase in the number of long- term unemployed Americans. The number of people unemployed for 27 weeks or more increased as a percentage of all jobless, to 41.9 percent, the highest since August.

• -5,000 construction jobs
• -13,000 manufacturing jobs
• +65,000 service providing jobs
• -28,100 retail trade jobs
• +53,000 professional and business services jobs
• +30,000 education and health services jobs
• +11,000 leisure and hospitality jobs
• -11,000 government jobs

The real costs of living is increasing. People have eroding real incomes. California is coming to grips with its $6 billion immediate shortfall. There has to be additional spending reductions. There are businesses shutting down and laying off people, still. If there are no benefits in California to keep the unemployed in California, there will be a wave of people that will move to lower cost areas and where the jobs are. That is a good thing for the economy as a whole. That is a bad thing for California. The remaining people in California will have to suffer a government shutdown when the money runs out. That's a good thing; it focuses the attention on the problems. That's a bad thing because the state has to pay out health and pension benefits and pay bondholders their interest and redeem bonds when they mature.

Sooner or later, more layoffs and furloughs have to occur to cut spending at the state, county and city levels.

 

[Randolph Kinney]

Wow: Bernanke Tells CBS That QE2 Isn't Limited To $600 Billion

Read more: http://www.businessinsider.com/wow-...-limited-to-600-billion-2010-12#ixzz17D6Z78UK

 

[Randolph Kinney]

Mounting State Debts Stoke Fears of a Looming Crisis

http://www.nytimes.com/2010/12/05/us/politics/05states.html?_r=1&nl=todaysheadlines&emc=a2

What's the fear all about? Booking - many state and local governments have so much debt, several trillion dollars’ worth with much of it off the books and largely hidden from view, that it could overwhelm them in the next few years.

Some people are ringing the alarm bell like they did for the real estate bubble, particularly concerning California which is increasingly at risk with its stupid policies.

Why aren't people and politicians worried in California? The belief is that the federal government is more likely to bail out a bankrupt state than a bankrupt company. And there is support for that belief: The federal government has broadly channeled cash to all state governments during recent recessions and provided support to individual states following natural disasters.

Nothing focuses people's minds like states bracing for more spending cuts, more layoffs, more tax increases, more battles with public employee unions, and more requests to bail out cities. Lets see the new governor (Jerry Brown) focus his mind on a cash flow shortage left by the old governor and legislators.

 

[Randolph Kinney]

Arizona Medicaid Cuts Seen as a Sign of the Times

http://www.nytimes.com/2010/12/05/us/05transplant.html?nl=todaysheadlines&emc=a24

Arizona has made the decision to stop paying for treatments urgently needed to ward off death; transplants - a classic example of making decisions based not on medical need but based on a budget. The cuts were imposed in an effort to close a $2.6 billion shortfall in the state’s $8.9 billion budget.

How's that hope and working out?

 

[Workbox]

Arizona Medicaid Cuts Seen as a Sign of the Times

http://www.nytimes.com/2010/12/05/us/05transplant.html?nl=todaysheadlines&emc=a24

Arizona has made the decision to stop paying for treatments urgently needed to ward off death; transplants - a classic example of making decisions based not on medical need but based on a budget. The cuts were imposed in an effort to close a $2.6 billion shortfall in the state’s $8.9 billion budget.

How's that hope and working out?

Do you think a certain tax base that got ran out may have caused a shortfall?

 

[Austin]

Do you think a certain tax base that got ran out may have caused a shortfall?

That 2.6 billion dollar short fall is a result of paying medical bills for that certain tax base that got run out. Tax base or cost base depending on the point of view. When you have an economy kept afloat by illegals you have an problem. If it were otherwise California would swimming in surpluses.