Global Economy Bursting?

[Randolph Kinney]

Art Cashin Offers A Huge Lesson On Weimar Hyperinflation, And The Roots Of Today's Crisis

Read more: http://www.businessinsider.com/art-cashin-on-germany-hyperinflation-2011-10#ixzz1azFlVIer

Originally, on this day (-2) in 1922, the German Central Bank and the German Treasury took an inevitable step in a process which had begun with their previous effort to "jump start" a stagnant economy. Many months earlier they had decided that what was needed was easier money. Their initial efforts brought little response. So, using the governmental "more is better" theory they simply created more and more money.

But economic stagnation continued and so did the money growth. They kept making money more available. No reaction. Then, suddenly prices began to explode unbelievably (but, perversely, not business activity).

So, on this day government officials decided to bring figures in line with market realities. They devalued the mark. The new value would be 2 billion marks to a dollar. At the start of World War I the exchange rate had been a mere 4.2 marks to the dollar. In simple terms you needed 4.2 marks in order to get one dollar. Now it was 2 billion marks to get one dollar. And thirteen months from this date (late November 1923) you would need 4.2 trillion marks to get one dollar. In ten years the amount of money had increased a trillion fold.

 

[Couch Potato]

Actually, if the workforce consists of middle-age male and females, then it would be hard to prove.

The younger workforce cannot be counted on but they work cheap.

The bottom line for businesses, move out of California. It won't matter what nutty laws and regulations they pass. And if those same nutty ideas go national, offshore the work. Both have happened and are happening and wil continue to happen.

Obviously discrimination is hard to prove if there is a balanced employment of across the board, but all it take is a gap in a given area to create a case. In discrimination cases once you can show a statistical gap in the workforce, the burden of proof shift to the defendant. They must prove they did not discriminate if they have not hired females of childbearing age. The difficulty of proving a negative on the part of the defendant is why discrimination cases are much easier to prove than would appear at first glance.

 

[Randolph Kinney]

Obviously discrimination is hard to prove if there is a balanced employment of across the board, but all it take is a gap in a given area to create a case. In discrimination cases once you can show a statistical gap in the workforce, the burden of proof shift to the defendant. They must prove they did not discriminate if they have not hired females of childbearing age. The difficulty of proving a negative on the part of the defendant is why discrimination cases are much easier to prove than would appear at first glance.

Speaking of statistics, take note:

In addition, the FMLA applies to employers with at least 50 employees. The California law applies to employers with as few as five employees.

If you are a small business (under 50 employees), I doubt that a case could be reasonably made based upon statistics, unless they are talking 90% male and 10% female.

Of couse we are talking California so if the statistics do not perfectly mirror the local population data ... :laugh:

 

[Randolph Kinney]

A trillion here, $500 billion there

The huge shortfalls in pension plans

http://www.economist.com/node/21532298

The pension hole just keeps getting bigger. The assets owned by pension schemes have generally been falling in price while their liabilities have been relentlessly rising. One of the culprits is quantitative easing (QE), a tactic devised by central banks to revive the economy.

I told you so! http://appraisersforum.com/showpost.php?p=2176496&postcount=1807

 

[Randolph Kinney]

Evading Downgrade, BofA Moves Trillions in Deriatives to Retail Bank Over Objections of FDIC

http://www.bloomberg.com/news/2011-...-moving-merrill-derivatives-to-bank-unit.html

Bank of America Corp. (BAC), hit by a credit downgrade last month, has moved derivatives from its Merrill Lynch unit to a subsidiary flush with insured deposits, according to people with direct knowledge of the situation.

The Federal Reserve and Federal Deposit Insurance Corp. disagree over the transfers, which are being requested by counterparties, said the people, who asked to remain anonymous because they weren’t authorized to speak publicly. The Fed has signaled that it favors moving the derivatives to give relief to the bank holding company, while the FDIC, which would have to pay off depositors in the event of a bank failure, is objecting, said the people.

Bank of America’s holding company -- the parent of both the retail bank and the Merrill Lynch securities unit -- held almost $75 trillion of derivatives at the end of June, according to data compiled by the OCC. About $53 trillion, or 71 percent, were within Bank of America NA, according to the data, which represent the notional values of the trades.

 

[Randolph Kinney]

The Austerity Myth: Federal Spending Up 5% This Year

http://www.investors.com/NewsAndAna...rity-Myth-Federal-Spending-Up-5-This-Year.htm

Some analysts have blamed these spending cuts for this year's economic slowdown. But data released by the Treasury Department on Friday show that, so far, there haven't been any spending cuts at all. In fact, in the first nine months of this year, federal spending was $120 billion higher than in the same period in 2010, the data show. That's an increase of almost 5%. And deficits during this time were $23.5 billion higher.

 

[Couch Potato]

Unlike housing, federal spending does only go up.

 

[Randolph Kinney]

California reportedly subpoenas BofA over toxic securities

http://www.latimes.com/news/local/la-fi-bank-america-harris-20111020,0,7737925.story

California is trying to determine whether BofA and its Countrywide Financial subsidiary sold investments backed by risky mortgages to investors in California under false pretenses, a source says.

 

[Randolph Kinney]

Think that California regulations and laws don't mater for small business?

Bye-bye California, hello Nevada!

California manufacturer eyes a move to Nevada

http://www.nevadaappeal.com/article/20111020/NEWS/111019705/1070&ParentProfile=1058

His company, Advanced Machining Techniques, makes parts for airplane ejection seats and Bradley Fighting Vehicles, among other projects. It rests at 49 employees now, Dutra said, because adding a 50th would incur “financial penalties” from the state of California.

But it also gives a reason for him to pick Northern Nevada as a place to put that new employee to work.

“Here, the OSHA manual is 263 pages long,” Dutra said. “California's is so vast that I couldn't even find how many pages there are.”

“We have an improved version of everything, including the Family Medical Leave Act, for those that dare to hire the 50th employee,” he said

He said he has plans in motion to move into Northern Nevada, with visible headway starting at the first of the year.

“Hiring the 50th doesn't make sense (in California),” he said after his speech. “So (looking to move here) was a logical choice.”

 

[Randolph Kinney]

Here comes the kiss of death: Calif Poised to Finalize 'Cap-and-Trade' Plan

http://abcnews.go.com/Technology/wireStory/calif-poised-finalize-cap-trade-plan-14775965

The California Air Resources Board on Thursday is expected to approve the final draft of its plan, a key part of the state's landmark 2006 global warming law, AB 32, which seeks to reduce the emissions to 1990 levels by 2020.

"When Washington considers how to address climate change, as I think it will, California's climate plan will serve as a role model for the national program," said Stanley Young, the air board's spokesman.