Saturday 1 September 2012

GOP platform at odds with public on defense spending

In May, the Center for Public Integrity and the Stimson Center unveiled the results of a major poll on defense spending. Our poll found wide consensus among the public and across party lines that the defense budget could use some trimming — around three-quarters of those polled thought there should be cuts for air power, ground forces, and naval forces, and over eighty percent said there is “a lot of waste” in the defense budget. In fact, respondents preferred far deeper cuts than those suggested by either the Obama administration or the Republicans.
During the conventions, we decided to take a look at what the party platforms say, and how that measures up to public opinion. First up: the GOP and presidential nominee Mitt Romney.
Romney has made it clear that he intends to expand defense spending if elected in November, having already called for spending a minimum of four percent of the GDP on national defense.
But Tuesday afternoon, as Romney was being officially nominated at the Republican National Convention, his party unveiled the official GOP platform for 2012. Included in the party platform was a thirteen-page section on “American Exceptionalism,” laying out the Republican view of defense and the future of the military.
While the document is light on specifics and heavy on rhetoric, there are some clues for what would be the Romney administration’s national security priorities. And in some very expensive cases, they don’t match up with public sentiment.
For example, the platform includes a call to strengthen American’s nuclear arsenal. “We recognize that the gravest terror threat we face – a nuclear attack made possible by nuclear proliferation – requires a comprehensive strategy for reducing the world’s nuclear stockpiles and preventing the spread of those armaments,” reads the platform.  “But the U.S. can lead that effort only if it maintains an effective strategic arsenal at a level sufficient to fulfill its deterrent purposes, a notable failure of the current Administration.”
This line echoes calls from prominent Republican Congressmen who wrote a letter in February calling proposed cuts by the Obama administration a “deep concern.” At the time, the Center reported how campaign finance records show that since 2009 the signers received $1.12 million from the employees and political action committees of the four large defense contractors with a major stake in the nuclear weapons industry. (Spokespeople for House members and companies alike deny there has been any quid pro- quo.)
But the public would prefer that the nuclear arsenal be reduced, not expanded. In fact, respondents on average favored at least a 27 percent cut in spending on nuclear arms — the largest proportional cut of any in the survey. Overall, two-thirds of those polled — 78 percent of Democrats, 64 percent of Republicans, and 57 percent of independents — expressed a desire to cut spending on nuclear arms.
In another part of their platform, the GOP claims the Obama administration has “systematically undermined America’s missile defense” and calls for a recommitment to America’s missile shield.  However, a pair of recent studies by the Government Accountability Office have called into question the costs and effectiveness of the missile defense program. In one case, as the Center has previously noted, a missile defense system has been cancelled for inefficiency but is still set to cash in on $250 million in taxpayer dollars.
According to the Center’s poll, the public favors cutting 14 percent of missile defense spending. At the same time, 74 percent of those polled believe that pursuing missile defense is important for the country’s national security, which means that Americans want a missile shield- just one that costs less money.
While discussing foreign aid, the GOP insists on relying more on private sector work than government-run programs that are a “proven breeding ground for corruption and mismanagement by foreign kleptocrats.” Corruption and waste in Afghanistan and Iraq is a long-standing problem that has haunted both the Bush and Obama administrations. In July, the Special Inspector General for Iraq Reconstruction told the Center he believes  $6 billion to $8 billion of taxpayer money has been lost to waste and abuse in Saddam Hussein’s former fiefdom; later that month the IG for Afghanistan reconstruction reported to Congress that millions of lost funds have been sunk into construction projects.
While the Center’s poll did not specifically ask about foreign aid, respondents were very clear about their views on Afghanistan: it’s time to get out. 85 percent of respondents expressing support for a statement that said in part, “it is time for the Afghan people to manage their own country and for us to bring our troops home.” A majority of respondents backed an immediate cut, on average, of $38 billion in the war’s existing $88 billion budget, or around 43 percent.
The platform also delves into social issues, calling for an enforcement of the “Defense of Marriage Act in the Armed Forces,” a reference to President Obama’s support for gay marriage. The GOP also pledged that “a Republican Administration will return the advocacy of religious liberty to a central place in our diplomacy” while calling for increased security against human traffickers on the border.
At the very end of the platform is a paragraph about Iran. ”A continuation of [the Obama Administration’s] failed engagement policy with Iran will lead to nuclear cascade,” warns the GOP. “American must lead the effort to prevent Iran from building and possessing nuclear weapons capability.”
The need to contain Iran, a major focus among the “Neoconservative” wing of the Republican party, has also driven the U.S. to increase arms sales to friendly Middle Eastern countries, most notably to Saudi Arabia, which last year purchased $33 billion in arms from America.
And, of course, not all Republicans are locked in with their party on military spending. In recent weeks some noted Republicans have begun calling for a Romney presidency to consider cuts to military spending as a necessity facing the country.
Stay tuned next week when we take a look at the Democratic party platform.

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Third-party candidates may hurt Romney in key states

Dark-horse presidential candidates Gary Johnson and Virgil Goode may not be household names, but with a little help from super PACs, they could peel away precious support from Republican Mitt Romney and possibly even President Barack Obama in some key state races.
The conservative Constitution Party, which seeks to “restore American jurisprudence to its Biblical foundations,” has nominated Goode, a former congressman from Virginia, for president, potentially taking votes away from Romney in what has become a presidential swing state.
Meanwhile, Johnson, a former two-term GOP governor of New Mexico who failed to win the 2012 Republican presidential nod, has been nominated by the Libertarian Party — a perch from which he could throw a wrench in the plans of both Obama and Romney in several swing states.
Already, at least three pro-Libertarian super PACs have registered with the Federal Election Commission to support Johnson. And former Nixon administration operative Roger Stone, famous for sporting a tattoo of the disgraced president on his back, has touted a pro-Johnson super PAC.
Super PACs are allowed to collect unlimited contributions from individuals, unions and corporations to produce political advertisements that are not coordinated with any candidate. They were made possible in the wake of the U.S. Supreme Court's Citizens United decision.
Goode, a staunch supporter of the 2nd Amendment and vocal opponent of abortion, served six terms in Congress — first as a Democrat, then as an independent and finally as a Republican, until he was unseated in 2008. Third-party candidates like Goode have no chance of winning the White House, but one only need look to the 2000 presidential election to be reminded of their potential impact.
When consumer advocate Ralph Nader ran as the Green Party’s candidate, he infamously garnered more than 97,000 votes in Florida, where Democrat Al Gore lost to Republican George W. Bush by just 537 votes. Florida’s 25 Electoral College votes secured the presidency for Bush, even though Gore won the national popular vote.
One recent poll showed Goode drawing 9 percent of the vote in his home state of Virginia, whose 13 Electoral College votes are being sought by both Romney and Obama.
Similarly, a recent poll showed Johnson — an anti-war candidate who supports marijuana legalization and smaller government — receiving 5.3 percent of the national popular vote. That makes him an afterthought as a presidential candidate, but he may still have an impact in battleground states like New Mexico, Colorado, New Hampshire and even North Carolina.
Third-party candidates aren’t always suggested as options in polls. But one survey earlier this summer showed Johnson winning 12 percent of the vote in New Mexico, a state that Obama carried handily in 2008, but where Bush eked out a narrow victory in 2004.
Johnson garnered 7 percent of the vote in a May poll in New Hampshire, which Obama won easily four years ago but Bush carried in 2000. Earlier this month, Public Policy Polling showed Johnson pulling 7 percent of the vote in Colorado where Obama was the first Democrat since Bill Clinton to win the state. Johnson is also polling at 3 percent in North Carolina, another swing state.
Super PAC spending on behalf of minor-party candidates like Johnson or Goode “definitely could happen,” said Rob Richie, executive director of the nonprofit FairVote, which advocates for increased ballot choice.
“Most people have made up their minds between keeping Obama or going to Romney,” Richie continued. “Some people, though, […] if they realized that there was another candidate running, might abandon one of the major-party candidates.”

Super PACs lead to more choices?

Officials with both the Obama and Romney campaigns declined to comment about whether they were concerned about the role super PACs touting third-party candidates could play in the presidential race.
Some third-party activists, though, are keen to harness super PACs — and their ability to raise unlimited funds, which they argue could increase the visibility of their preferred candidates.
“I wish we had super PACs out there supporting our candidates,” said Jim Clymer, who was the national chairman of the Constitution Party until April. He is now Goode’s vice presidential running mate.
“A couple of people who believe deeply in what we’re trying to promote could put us on the map in a way that we haven’t been,” he added. “The reality is that getting your message out takes a lot of money.”
His sentiments are echoed by Libertarian Party activists.
“A libertarian candidate like Gary Johnson doesn’t have the infrastructure behind him that the major-party candidates have,” said Austin Cassidy, the treasurer of the pro-Johnson Libertarian Victory Committee super PAC, which was formed in May.
“If voters have the chance to compare him on an even playing field that could really spark something,” Cassidy continued.
Cassidy’s Libertarian Victory Committee raised only $200 — all from Cassidy’s own pocket — before throwing in the towel earlier this month, but the pro-Johnson Libertarian Action Super PAC has raised $107,500 as of the end of June. The bulk of that money — $100,000 — came from wealthy entrepreneur Joe Liemandt, the Stanford University dropout who founded and runs the software company Trilogy.
Notably, Liemandt's wife Andra has bundled more than $200,000 for Obama's re-election efforts, and the couple alone has donated $107,400 to the Obama Victory Fund, which benefits Obama's campaign and the Democratic National Committee. Together, they have also donated more than $130,000 to the Libertarian National Committee since 2009.
Wes Benedict, the former executive director of the Libertarian Party who is now the treasurer of the Libertarian Action super PAC, stresses that $100,000 in receipts is “significant,” even if it’s dwarfed by the tens of millions of dollars raised by the pro-Obama and pro-Romney super PACs.
“In Libertarian terms, this is a big step forward,” he said. “We’re in new territory running this super PAC,” he continued. “I hope we make a difference.”
Since it was launched in April, Libertarian Action, which promotes “low-cost, high-quality Gary Johnson materials” such as yard signs, bumper stickers and door hangers on its website, has reported making more than $16,000 in independent expenditures.
Another pro-Johnson super PAC, called Freedom and Liberty PAC, has also raised $100,000, though it has yet to make any expenditures touting Johnson or criticizing his rivals. The group was founded by one-time Johnson aide Kelly Casaday, and its sole donor is Chris J. Rufer, the founder of the Morning Star Company, a California-based agribusiness and food processing company.
The super PACs file their campaign finance reports with the FEC on a quarterly basis, so it’s unknown how much money they have raised since the second quarter ended in June. A few wealthy donors could easily make them more flush with cash. At least one million-dollar contribution has been given to a pro-Johnson super PAC, according to Jim Gray, the Libertarian Party’s vice presidential nominee.
Not all third-party activists, though, think embracing super PACs is a good thing.
“[Super PACs] are squashing competition,” said David Cobb, who was the Green Party’s presidential nominee in 2004. “When the wealthy elite can buy microphones and amplifiers and drown out the rest of us, it is supremely ridiculous to say that that somehow increases the competition of ideas.”

Good things or dirty tricks?

One person with the potential to make a large super PAC splash for a third-party candidate is long-time Republican operative Roger Stone.
Stone was the youngest staffer on Nixon’s infamous Committee for the Re-election of the President, the group that financed the Watergate break-in. He later went on to work with the late Lee Atwater, the strategist who managed Republican George H.W. Bush’s 1988 presidential campaign against Democrat Michael Dukakis. And during the contentious Florida recount between Republican George W. Bush and Democrat Al Gore, Stone was dispatched to supervise the process.
Yet, in February, Stone, who did not respond to requests for an interview, said goodbye to the GOP and registered as a Libertarian after casting a vote for Ron Paul in the Florida GOP presidential primary.
In June, the Huffington Post reported Stone was constructing a pro-Johnson super PAC.
“The American people have never been offered a candidate who is fiscally and economically conservative but socially tolerant,” Stone has said. “With Gary Johnson, you can have the best of both.”
In his writings online, Stone stresses that Johnson has the potential to perform well in many battleground states, particularly in the West — and that Johnson has the potential to win over both supporters of Obama and Romney.
Stone’s name has not yet appeared in any FEC super PAC filings, and so far, his new Libertarian Party allies are cautiously optimistic about his planned endeavors.
“Hopefully he’s up to good things and not dirty tricks,” said Benedict, the former Libertarian Party executive director.
Most political observers argue that outside groups are unlikely to change the fundamental calculus that makes a third-party presidential bid an uphill battle.
Americans Elect is a prime example, according to political science professor Larry Sabato, the director of the Center for Politics at the University of Virginia. The organization launched in 2010 with the hope of getting a centrist political candidate onto the ballot in all 50 states. The group raised more than $35 million — including $5.5 million from billionaire hedge fund investor Peter Ackerman — but it failed to find a willing candidate and has since retreated from the limelight.
“A super PAC can only sell a candidate if there's a market for him or her,” Sabato said. “I don't think there is one in this highly polarized year.”
But as Democrats learned in 2000, a third-party candidate need not be a threat to win to have an impact.

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One Person View On:Bank of England Interest Rate Policy - As Consumers Struggle

One persons comment and opinion of how they feel about this policy:Extract as written 

 My savings are intended firstly to help in eventual retirement and secondly, to allow me to spend some of it now.

 The former is being made very uncertain by this pronounced and prolonged savers/debtors imbalance - in effect, negative rates eroding the pensions pot. If I had the sort of money mpc members have, then it wouldn't be a problem.

 The latter is not possible because of inflation. There's no slack to spend. I have to try to preserve what I have by keeping it in fixed term accounts to get the best rate in order not to fall too far behind inflation.

 Rates ought to keep pace with inflation. If house prices fell (it's not certain they would by much), then they will recover after the short term.  After 4 years of bountifully low rates few mortgagees should be in potential difficulty - savers shouldn't be expected to cover current debtors risks.

 Wish I was a debtor.

Ace Debt News: says that as we are getting deeper into an imbalance in our economy we are reaching a tip over point, at which time we will be unable to put our economy back on kilter! Their last comment about wishing to be a debtor is most unnerving and should be making alarm bells ring with our government! The fact is they are so involved with their own " self importance" they fail to notice the man/woman in the street!

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Credit card lending sees biggest drop in six years

Net credit card lending fell by £147 million in July, according to figures released today by the Bank of England.

Ace Debt News: Says 

This is one good thing that comes out of any crisis that people start to cut-back on spending!As the advent of a downturn in the fortunes of people and as austerity measures start to bite this will be only a good thing.

We cannot borrow ourselves out of debt! We can only manage debt with good financial advice!
        
For  more information on managing debt email me at Ace News Desk with your details and l will try to help and share your opinions at #AceDebtNews

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Monday 27 August 2012

Osborne 'Will Fail To Stop Rise In Public Debt'

The government is "most unlikely" to meet its target to eliminate Britain's structural deficit by 2015, a think-tank has warned.

Chancellor George Osborne will also fail in his economic goal to stem the increase in public debt before the next general election, according to the Centre for Policy Studies (CPS).

In a report released today, the CPS said: "The coalition came into office in 2010 with the stated aim that it would eliminate the current structural deficit within five years and stem the increase in public debt as a proportion of GDP. It is not achieving these aims.

"Though it correctly asserts that the deficit has fallen by around a quarter since 2010, the cyclically-adjusted current deficit (the part it said it wanted to eliminate within five years), had only fallen by 13.2% by the end of 2011/12."

The study found that the the majority of the reduction in the deficit has come from cuts to investment spending and tax increases rather than public spending cuts.

It said that only 6% of the Coalition's planned cuts to current expenditure had so far been implemented.

The right-leaning think-tank's report also said that official national debt is forecast to rise by £605 billion over the course of this Parliament, or from 53% of GDP in 2009/10 to 76% of GDP in 2014/15, despite the deficit falling.

"This week's growth and borrowing figures make it all the less likely that debt will be on a downward path until the next Parliament, meaning the Coalition's hard mandate will not be met on unchanged policy," the study added.

The Government's problems are exacerbated by the fact that the difference between "deficit" and "debt" is still widely misunderstood by the public, added the CPS.

A poll conducted by the think-tank as part of the report found that 47% of people believe that public debt will actually fall by around £600 billion by 2015.

Only 39% of people also correctly identified that the budget deficit has fallen since 2010.

Ryan Bourne, one of the report's authors, said: "It's becoming increasingly probable that, on current policy, neither of the Coalition's original fiscal mandates are going to met.

"With the recent dreadful borrowing figures, now would be a good time for the Coalition to restate the scale of our fiscal problems, and to set out how they will be addressed."

He added: "Only by having a clear knowledge of the problems and solutions on offer from the different parties will the electorate be able to make an informed choice in 2015."

The Treasury rejected the CPS analysis.

"The Independent Office for Budget Responsibility's (OBR) most recent assessment is that the government is broadly on track to meet its debt and deficit targets," a spokesman said.

"The OBR will update its forecasts in the autumn."

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Alistair Darling Warns Germany: Don't Go Back To The 1930s

Alistair Darling Warns Germany: Don't Go Back To The 1930s:
Alistair Darling has strongly criticised the German government's policies towards recovery in the eurozone, suggesting a failure of leadership by Angela Merkel and other European politicians risks political upheaval similar to that seen in the 1930s.

In an interview with The Huffington Post UK the former Labour chancellor expresses his fears that European politicians will continue to kick the can down the road, despite predictions that the Greek debt crisis will come to a head in September.

Building on comments at the weekend in which Darling attacked George Osborne and the coalition's economic policies, he now turns his fire on the German government, suggesting only an "extraneous shock" will spur them into taking substantive action.

"If we carry on like this, the only thing that's going to change people's minds is another severe shock," he told us. "It could be a banking crisis, a default, it could be that someone wakes up one morning and decides to have a real go at one of the larger economies in Europe. And people will find the fund they have works for small countries, but if Spain had problems it would hoover it up in a few hours.

Darling dismisses predictions that next month will see a denouement to the eurozone crisis, despite speculation that the ongoing uncertainty surrounding Greece's future in the single currency will come to a head in September.

Next month is likely to see both Greece and Spain having to go cap in hand to Europe for bailouts, and while concerns about the eurozone have been subdued over the summer the next few months are expected to see further negotiations as Greece struggles to meet the austerity requirements of its rescue package from the European Central Bank. The eurozone psychodrama is likely to resurface by the end of this week, as talks on Greece's austerity timetable are expected to resume.

Darling believes the current debt management plan for Greece is untenable.

"You've got to have a settlement than is credible," he says. "One that leaves the Greeks with more debt in 2020 than they started with is not credible. Their prime minister [Antonis Samaras] is not a firebrand, he won the election saying there was no alternative.

"And it's not just him," Darling goes on. "Spain, again a right of centre government, one that is following almost to the letter Mrs Merkel's prescription, is saying this is not working. [Italian prime minister] Mario Monti, who is more mainstream if you like, could only persuade Italians to take the pain if there is some gain.

"What you see in Europe at the moment is policies being pursued that are manifestly not working," Darling concludes, "And this is like the 1930's, they carried on pursuing policies which weren't working. How much is it going to take to make them change their minds?

"Does Germany remember the history of the 1930s, when people claimed it was high inflation that brought in fascism? It wasn't. It was the depresssion that brought in the despair into the then-Weimar Republic that allowed people who were absolutely vile to take over," Darling told HuffPost on Thursday.

"If you take the economic lessons of the 1930s, the prescription that is being advocated now is not disimmilar to the prescriptions that were being advocated by the British and US treasuries in the early 1930s, and it didn't work."

"It took a new deal and ultimately re-armament. I think people have forgotten it."

In a broadside against the coalition, the Bank of England and the European Central Bank, Darling suggested leaders were creating the impression that they've given up, and that this was politically dangerous.

"I am more despairing now than I've been since this crisis started," he says. "If you go back to 2008, people are now openly saying we were right. I recently saw one of the present government's chief backers who said that to me, as if he'd never said anything different.

"Our influence is much reduced, and we need to co-operate with the eurozone," Darling insists. "Politicians will get it wrong from time to time, but at the moment everybody looks like they've given up trying, and that creates disillusionment, and that's what you've got to worry about. People feel that no-one's showing the lead, they become open to ideas that most people would normally want to give a wide berth to."

Asked whether he thought European geopolitics are still more malleable than people commonly assumed, he replied: "It is. People forget 2008, never mind the 1930s, or the 1920's. It really is very depressing.

"I think the best we can hope for is a continued muddling through for a few more crises, but there will come a time when something will happen, and my guess is it will happen in a way they weren't expecting, and they'll be caught with their trousers down.

"The one thing they are agreed on is that they're not going to agree. It will take some extraneous shock to the system that will achieve that."

In terms of Labour's response to the economic crisis, Darling stuggests that Ed Balls needs to "put down markers" at the Labour Party conference. "Both Eds will be aware of it," he told us.

"You can spend your first year looking back, your second year taking stock, but in the third year Ed Balls will want to develop that, and I think he will."

But Darling counsels the current generation of frontline politicians to stay their hand in terms of bashing the banking industry.

"What we have to do is find that fine line between putting things right without trashing something, because there are people in other parts of the world who'd dearly love to get their hands on it," he says.

Darling referred to the attacks on Standard Chartered by regulators in New York state earlier this month, which the former chancellor described as "political", in line with other Labour politicians.

"Bashing banks can be superficially good politics, and bashing other people's banks cleary is very attractive. It looked like a classic American pose, to accuse the bank of all sorts of things, and get them to settle.

"If I was an American politican or regulator, I'd say be careful. One thing that's terribly important in fiancial services is certainty. You don't want a degree of arbitrariness about how it goes.

"It's a difficulty place to occupy, but I think because I'm no longer in frontline politics I can better occupy it than if I was," he concludes.

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Former Tory Treasurer: Give Back 'Tainted' Asil Nadir Money

Former Tory Treasurer: Give Back 'Tainted' Asil Nadir Money:
The man who was Tory treasurer when the party received hundreds of thousands of pounds in donations from Asil Nadir's Polly Peck business empire has called on David Cameron to hand back the "tainted" money.

Lord McAlpine said the Prime Minister was under a "moral duty" to return the political gift after the former fugitive tycoon was jailed for 10 years yesterday.

The sentencing of Nadir, who donated £440,000 to the Tories during the 1980s, came a day after he was convicted of stealing £28.8 million from the global business he built from an east London textile company.

Urging the governing party to return the money, Lord McAlpine told The Daily Mail: "It is tainted money and it shames the Conservatives if they hang on to it. They have a moral duty to give it back."

He said the money should be paid to Nadir's creditors, some of whom lost their life savings when Polly Peck International (PPI) crashed leaving debts of £550 million.

Nadir, who was once 36th on the Sunday Times Rich List, was found guilty of 10 counts of theft from the Stock Exchange high performer between 1987 and 1990.

The 71-year-old fled Britain for his native Northern Cyprus in May 1993 but returned voluntarily in August 2010 to face trial.

The amount he stole is the equivalent of £61.6 million today. The prosecution had alleged it was part of £150 million taken from the company.

Old Bailey judge Mr Justice Holroyde said Nadir stole the money out of "pure greed" and that his behaviour had contributed to PPI crashing. Investors who lost money included large institutions, small investors and pension funds.

Lord McAlpine, who was Tory Treasurer from 1975 when Margaret Thatcher became leader until her fall in 1990, added: "The moment he (Nadir) fled the country in 1993, to avoid criminal charges, it was obvious to me he was a complete conman.

"Frankly the Tories should have given the money back in 1993. But today the case is even clearer.

"There is a moral imperative for the money to be returned. The money was not Asil Nadir's to give although we thought it was at the time. Therefore the Tory Party has a duty to return it."

The peer added that he was certain that Lady Thatcher would have ordered the party to return the money immediately if she was still leader.

The Conservatives have insisted the donations were made by Polly Peck, rather than by Nadir, and had seen no evidence the money was stolen.

However, Labour backbencher Simon Danczuk pointed to press reports from the 1990s which stated that a report by accountants Touche Ross in 1993 warned the Tory Party that £365,000 of the £440,000 it received in donations came from money defrauded from Polly Peck.

In a letter to Tory co-chairman Baroness Warsi, Mr Danczuk said: "The Touche Ross report raised serious issues about the donations received.

"The conviction of Asil Nadir on charges of theft has brought this issue back into the public eye but it also presents the Conservative Party with an opportunity to finally put this matter to bed."

A Conservative Party spokesman said they were not aware of the Touche Ross report and questioned whether it ever existed.

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Sunday 26 August 2012

Even Adam Smith Would be Appalled by Romney's Tax Evasions

Even Adam Smith Would be Appalled by Romney's Tax Evasions:

Mitt Romney says “every year I’ve paid at least 13 percent [of my income in taxes] and if you add in addition the amount that goes to charity, why the number gets well above 20 percent.”
This is supposed to be in defense of not releasing his tax returns.

Assume, for the sake of the argument, he’s telling the truth. Since when are charitable contributions added to income taxes when judging whether someone has paid his fair share?

More to the point, Romney admits to an income of over $20 million a year for the last several decades. Which makes his 13 percent — or even 20 percent — violate the principle of equal sacrifice that lies at the core of our notion of tax fairness.

Even Adam Smith, the 18th century guru of free-market conservatives, saw the wisdom of a graduated tax embodying the principle of equal sacrifice. “The rich should contribute to the public expense,” he wrote, “not only in proportion to their revenue, but something more in proportion.”

Equal sacrifice means that in paying taxes people ought to feel about the same degree of pain regardless of whether they’re wealthy or poor. Logically, this means someone earning $20 million a year should pay a much larger proportion of his income in taxes than someone earning $200,000, who in turn should pay a larger proportion than someone earning $50,000.

But Romney’s alleged 13 percent tax rate is lower than that of most middle class Americans who earn a tiny fraction of what he earns.

At a time when poverty is increasing, when public parks and public libraries are being closed and when public schools are shrinking their offerings and their hours, when the nation’s debt is immense, and when the 400 richest Americans have more wealth than the bottom 150 million of us put together — Romney’s 13 percent is shameful.

Sun, 08/19/2012 - 05:18
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Saturday 25 August 2012

BofA: 'CODE RED..RISK OF SELL-OFF IS HIGH' (SPY)

BofA: 'CODE RED..RISK OF SELL-OFF IS HIGH' (SPY):
Code red alert siren
Yesterday, BofA's top North America economist Ethan Harris penned a bearish note on the the U.S. economy, writing that it "is in the eye of the storm" and that a number of troubling headwinds loom on the horizon.
BofA strategists Arjun Mehra and Cheryl Rowan have a warning more precisely aimed at the stock market. In a note to clients entitled Code Red, Mehra and Rowan claim there is "limited upside from here" and the "risk of a sell-off is high."
The strategists point out that stocks have managed to rally even in spite of one of the worst earnings seasons in years and growth slowing in the U.S. and around the world. They think the explanation is the "Bernanke Put;" in other words, investors are expecting more monetary easing in the form of QE3.
But in spite of the dovish language from the Fed this past week, Mehra and Rowan are concerned that the central bank may disappoint.
From the note:
Risk of a sell-off is high
Economist Michael Hanson points out an interesting circular relationship between the stock market and Fed policy. There are some who believe the Fed will not launch QE3 so long as stock prices remain high, yet the stock market is high because it anticipates QE3. Should the Fed disappoint at the September 12-13 FOMC meeting, the risk of a stock sell-off is high. S&P 500 support on a correction is in the 1360-1325 area. Additional support is at 1300-1250. Attention will be on the Jackson Hole symposium next week to get a feel for the Fed’s tone.
Macro catalysts increase the risk of a correction
Our strategists see an unusually high number of macro catalysts over the next 3-6 months that could take markets lower. We expect economic growth to disappoint in the second half of the year in anticipation of the fiscal cliff. This would exacerbate any slowdown from the deepening recession in Europe and decelerating growth in emerging markets. There is also the ongoing tension in the Middle East, the potential for a US credit downgrade and accelerating downward analyst estimate revisions. To top it off, September is seasonally the weakest month of the year for stock price returns.
The BofA strategists conclude that with the VIX at record low levels, those looking to hedge against a correction should buy put options on stocks while they are cheap, echoing a message several Wall Street analysts have relayed on television and in client notes over the past week.

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So, Mitt Romney, What Do You Really Believe?

So, Mitt Romney, What Do You Really Believe?:
national review mitt romney
Too much about the Republican candidate for the presidency is far too mysterious
WHEN Mitt Romney was governor of liberal Massachusetts, he supported abortion, gun control, tackling climate change and a requirement that everyone should buy health insurance, backed up with generous subsidies for those who could not afford it. Now, as he prepares to fly to Tampa to accept the Republican Party’s nomination for president on August 30th, he opposes all those things. A year ago he favoured keeping income taxes at their current levels; now he wants to slash them for everybody, with the rate falling from 35% to 28% for the richest Americans.
All politicians flip-flop from time to time; but Mr Romney could win an Olympic medal in it (see "Mitt Romney’s chances: The changing man"). And that is a pity, because this newspaper finds much to like in the history of this uncharismatic but dogged man, from his obvious business acumen to the way he worked across the political aisle as governor to get health reform passed and the state budget deficit down. We share many of his views about the excessive growth of regulation and of the state in general in America, and the effect that this has on investment, productivity and growth. After four years of soaring oratory and intermittent reforms, why not bring in a more businesslike figure who might start fixing the problems with America’s finances?

Details, details

But competence is worthless without direction and, frankly, character. Would that Candidate Romney had indeed presented himself as a solid chief executive who got things done. Instead he has appeared as a fawning PR man, apparently willing to do or say just about anything to get elected. In some areas, notably social policy and foreign affairs, the result is that he is now committed to needlessly extreme or dangerous courses that he may not actually believe in but will find hard to drop; in others, especially to do with the economy, the lack of details means that some attractive-sounding headline policies prove meaningless (and possibly dangerous) on closer inspection. Behind all this sits the worrying idea of a man who does not really know his own mind. America won’t vote for that man; nor would this newspaper. The convention offers Mr Romney his best chance to say what he really believes.
There are some areas where Mr Romney has shuffled to the right unnecessarily. In America’s culture wars he has followed the Republican trend of adopting ever more socially conservative positions. He says he will appoint anti-abortion justices to the Supreme Court and back the existing federal Defence of Marriage Act (DOMA). This goes down well with southern evangelicals, less so with independent voters: witness the furore over one (rapidly disowned) Republican’s ludicrous remarks about abortion and "legitimate rape" (see "The Todd Akin affair: Grenades and stilettos"). But the powers of the federal government are limited in this area; DOMA has not stopped a few states introducing gay marriage and many more recognising gay civil partnerships.
The damage done to a Romney presidency by his courting of the isolationist right in the primaries could prove more substantial. He has threatened to label China as a currency manipulator on the first day of his presidency. Even if it is unclear what would follow from that, risking a trade war with one of America’s largest trading partners when the recovery is so sickly seems especially mindless. Some of his anti-immigration policies won’t help, either. And his attempts to lure American Jews with near-racist talk about Arabs and belligerence against Iran could ill serve the interests of his country (and, for that matter, Israel’s).
Mitt RomneyOnce again, it may be argued that this will not matter: previous presidents pandered to interest groups and embraced realpolitik in office. Besides, this election will be fought on the economy. This is where Manager Romney should be at his strongest. But he has yet to convince: sometimes, again, being needlessly extremist, more often evasive and vague.
In theory, Mr Romney has a detailed 59-point economic plan. In practice, it ignores virtually all the difficult or interesting questions (indeed, "The Romney Programme for Economic Recovery, Growth and Jobs" is like "Fifty Shades of Grey" without the sex). Mr Romney began by saying that he wanted to bring down the deficit; now he stresses lower tax rates. Both are admirable aims, but they could well be contradictory: so which is his primary objective? His running-mate, Paul Ryan, thinks the Republicans can lower tax rates without losing tax revenues, by closing loopholes. Again, a simpler tax system is a good idea, but no politician has yet dared to tackle the main exemptions. Unless Mr Romney specifies which boondoggles to axe, this looks meaningless and risky.
On the spending side, Mr Romney is promising both to slim Leviathan and to boost defence spending dramatically. So what is he going to cut? How is he going to trim the huge entitlement programmes? Which bits of Mr Ryan’s scheme does he agree with? It is a little odd that the number two has a plan and his boss doesn’t. And it is all very well promising to repeal Barack Obama’s health-care plan and the equally gargantuan Dodd-Frank act on financial regulation, but what exactly will Mr Romney replace them with--unless, of course, he thinks Wall Street was well-regulated before Lehman went bust?

Playing dumb is not an option

Mr Romney may calculate that it is best to keep quiet: the faltering economy will drive voters towards him. It is more likely, however, that his evasiveness will erode his main competitive advantage. A businessman without a credible plan to fix a problem stops being a credible businessman. So does a businessman who tells you one thing at breakfast and the opposite at supper. Indeed, all this underlines the main doubt: nobody knows who this strange man really is. It is half a decade since he ran something. Why won’t he talk about his business career openly? Why has he been so reluctant to disclose his tax returns? How can a leader change tack so often? Where does he really want to take the world’s most powerful country?
It is not too late for Mr Romney to show America’s voters that he is a man who can lead his party rather than be led by it. But he has a lot of questions to answer in Tampa.


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Bailed-out banks, Freddie Mac, AIG gave $6 million to 2008 conventions

Bailed-out banks, Freddie Mac, AIG gave $6 million to 2008 conventions:
The Republican nominating convention that kicks off Monday in Tampa (weather permitting), has been funded by tens of millions of dollars in corporate contributions, the exact source of which won’t be known until after the party is over.
But it’s a sure bet that there are at least two big donors from the 2008 event that won’t be giving this time around — American International Group and Freddie Mac.
The two institutions together gave $1 million to the Republican convention host committee. A few months after the conclusion of the convention they were in danger of collapse, and would ultimately receive a combined $139 billion taxpayer bailout.
The donations are possible thanks to a loophole in campaign finance rules that allow corporations, unions and wealthy individuals to give unlimited sums to support the conventions.
It is “absolutely ridiculous” that corporations are able to make such donations, says Craig Holman, a lobbyist for the consumer advocacy group Public Citizen. He calls it “nothing but throwing money at the feet of congressional and White House leaders, presumably with the assumption of getting something in return.”
The two groups were bipartisan in their giving.
AIG gave $750,000 to both the Republican and Democratic host committees. The government would eventually sink $71 billion into the insurance giant. Mortgage buyer Freddie Mac gave $250,000 to both committees. Three days after the close of the Republican event, the government took it over along with Fannie Mae. Taxpayers ultimately sunk $70 billion into the floundering institution.
In all, $6 million was donated by financial institutions that received bailout money to both party conventions, according to a Center for Public Integrity review of Federal Election Commission filings — $3.4 million to Republicans and $2.6 million to Democrats
The total raised for the previous conventions is likely much higher than what we will see this year.
Through the end of 2008, the Republican host committee collected more than $65 million for the event, conducted in Minneapolis, while the Democratic convention in Denver drew about $63 million.
Republicans, meeting in Tampa, barring the arrival of a possible hurricane, aim for $50 million while Democrats, meeting in Charlotte, N.C., a week later, set a relatively modest goal of $37 million, having refused to accept direct contributions from corporations.
It wasn’t supposed to be this way. Reforms in the 1970s were meant to keep corporate money out of conventions. In 1972, as Republicans were trying to decide where to host their national convention, International Telephone & Telegraph offered $400,000 if the GOP would bring it to San Diego. Eight days later, the administration of President Richard Nixon dropped antitrust litigation against IT&T and offered a settlement that was favorable to the corporate giant.
After details of the apparent deal appeared in the press, Republicans tried to save face and moved the convention from San Diego to Miami Beach.
The scandal prompted Congress to enact a new law that would provide taxpayer funding for the parties' conventions, thus removing the need for private contributions — in theory, anyway. For 2012, each party has received $18.2 million from the U.S. Treasury to help defray costs.
But both parties are permitted to operate nonprofit corporations known as “host committees” set up as charitable organizations to offset the financial burden on local governments associated with hosting the conventions.
Democrats have struck a populist note this year, prohibiting direct corporate, political action committee and lobbyist donations. The party has also restricted individual donations to $100,000.
Campaign finance reformers still see loopholes — corporations are allowed, for instance, to make "in-kind" contributions.
During the Democrats’ 2008 convention in Denver, companies provided the host committee with about $5.8 million in in-kind contributions, including $1.7 million in “network equipment” from the tech giant Cisco System, which, records show, was the No. 1 corporate donor to the host committee.
Yet still, “it’s a very significant departure from the past,” Holman said.
The No. 1 corporate supporter of the Republican’s host committee was Qwest, now CenturyLink, which provided nearly $5 million. About half of that was donated directly to the committee and about half was from in-kind contributions. The telecommunications firm also gave roughly $840,000 to the Democratic host committee.
The top individual donor to the Republican committee was Raymond T. Dalio, founder of Bridgewater investments, the world’s largest hedge fund. He gave $2 million.
Overall, companies contributed more than $40 million to the Democratic host committee in Denver and unions donated about $9 million, according to federal records. And companies contributed roughly $52 million to the Republicans’ host committee in Minneapolis-St. Paul.
The Republicans’ Tampa host committee website lists more than two dozen companies and trade associations as “our sponsors.”
This year, companies ranging from Coca-Cola and Wells Fargo to Xerox and UPS are working to ensure that they have a presence at both conventions.
“There’s a lot of cost around the convention,” said Wells Fargo spokesman Kathy Harrison. “It is important as a good corporate citizen to support the host city.”
Wells Fargo was one of the banks that benefited from the government’s bank bailout, though it has paid the $25 billion equity investment back, plus a $2.3 billion profit.
In 2008, the Republican host committee received $3.4 million in donations from banks that received investments from the U.S. Treasury. Donations came from U.S. Bancorp ($1 million); Goldman Sachs & Co. ($255,000); Wells Fargo ($250,000); J.P. Morgan Chase ($100,000) and Morgan Stanley ($100,000) and others.
The Democratic host convention collected $2.6 million, including nearly $330,000 from Wells Fargo and its foundation; nearly $317,000 from U.S. Bancorp; $250,000 from both Goldman Sachs and Citigroup; $150,000 from Morgan Stanley and $100,000 from Bank of America.
Most of the banks and other institutions that made contributions to the conventions have recovered nicely from the recession, once again posting healthy profits — with at least one major exception. Lehman Brothers, whose bankruptcy filing in 2008 spun the global financial markets into a panic, gave $100,000 to the Democratic convention.

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Thursday 16 August 2012

OFT issues Statement of Objections against Booking.com, Expedia and Intercontinental Hotels Group

OFT issues Statement of Objections against Booking.com, Expedia and Intercontinental Hotels Group: The OFT has issued a Statement of Objections alleging that Booking.com, Expedia Inc and InterContinental Hotels Group plc have infringed competition law in relation to the online supply of room only hotel accommodation by online travel agents.

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OFT secures refunds for consumers following Olympic ticket investigation

OFT secures refunds for consumers following Olympic ticket investigation: Following an OFT investigation, Euroteam AS, Uncus AS, Ticket and Travel AS and the controlling director of these companies, Andreas Gyrre, have given undertakings to the High Court in relation to the unauthorised sale of tickets to the London Olympics.

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Thursday 9 August 2012

Airbus Could Reduce Plane Fuel Consumption 15% with Hydrogen Fuel Cell

Airbus Could Reduce Plane Fuel Consumption 15% with Hydrogen Fuel Cell:
The idea is to take a load off the plane's engines by powering non-propulsion systems - basically everything that run on electricity in the plane, light the entertainment electronics avionics, lights, etc - with a fuel cell rather than with the engines.

Ed says! The word " could " in this post, when we talk of reducing fuel consumption! Will depend on lobbying by fuel companies and how powerful and if they can get their own way! Many times ideas like this have been shelved in favour of profit before the environment! What is your news and views email me at Ace News and Views    
or tweet your question at #AceFinanceNews

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World's First Deep Sea Gold & Copper Mine Coming to Papua New Guinea

World's First Deep Sea Gold & Copper Mine Coming to Papua New Guinea:
A Canadian company will soon begin an unprecedented mining in the deep sea off the coast of Papua New Guinea

Another disaster waiting to happen when they start mining for gold and copper? What is your news and views?    
#AceNewsServices  

Key Republicans Rally Behind Wind Power in Congress

Key Republicans Rally Behind Wind Power in Congress:
With an important tax credit set to expire, Republicans and Democrats alike are defending wind power's importance to the economy.


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Wednesday 25 July 2012

Olympic security highlights seven weaknesses in UK industry policy

Olympic security highlights seven weaknesses in UK industry policy:
Reblogged from Dr Alf's Blog:
Click to visit the original post
Royal Standard of the United Kingdom (Photo credit: lydia_shiningbrightly)

The Telegraph newspaper picks up a topical story in the UK media. It’s well worth a read. Check it out!
Olympic security: The firm at centre of the shambles ‘has seen fee rise by £53m’ – Telegraph.
However for me, it highlights a number of powerful weaknesses in  UK industry policy:
Read more… 397 more words
This is the type of funding that could be so easily used to help our care industry and people in need! Instead of G4S it should be " Good For Us "

" The Roving Giraffe News Report " provided through Ace News Service

Saturday 5 May 2012

Credit Card Scam In Connecticut A Family Business

Credit Card Scam In Connecticut A Family Business: NEW LONDON, Conn. – Connecticut State Police have arrested Joseph Ellis and his nephew Michael Hyslop after they used counterfeit Discover credit cards to the tune of $362,000. The cards were used to get cash advances, gift cards, and buy merchandise from a number of businesses in the area during 2011. Both men were charged [...]
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Final Cent To Roll Off The Line Friday

Final Cent To Roll Off The Line Friday:
WINNIPEG - The last penny has dropped in Canada.
The Royal Canadian Mint in Winnipeg struck the final one-cent coin under the eye of Finance Minister Jim Flaherty on Friday.
Flaherty pushed a button on a machine that moments later spit out the last batch of shiny pennies to enter circulation.
"The time has come to make the sensible decision to end production of the coin, which is underused by Canadians, no longer vital to commerce and ultimately a burden on Canada's balance sheet," Flaherty said.
He announced in the March budget that the coin would no longer be produced because the cost of making it is more than it's worth. He has estimated that the government will save $11 million a year.
Flaherty said the penny used to be a source of revenue for the Mint and the government when its face value exceeded the expense to make it.
"Unfortunately this fine balance could not be maintained indefinitely. Over time inflation eroded the purchasing power of the penny and multiplied its manufacturing costs."
Flaherty is urging people not to hang onto their coppers.
"We hope that all Canadians will consider putting their last pennies to good use by donating them to charity."
Even though the coins will no longer be made, they will always be accepted in transactions as long as they are still in circulation.
Canada joins several countries that have already dropped pennies or their equivalent, including Australia, New Zealand, Brazil, Israel and South Africa.
The first penny to be domestically struck was produced in Ottawa in January 1908 to open the first national mint. Lady Grey, wife of Gov. Gen. Lord Albert Grey, was there to oversee the penny's birth.
The last one-cent piece is going to Canada's currency museum in Ottawa.

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Mom Sues Son For Stealing Lotto Jackpot

Mom Sues Son For Stealing Lotto Jackpot:
A 76-year-old woman claims her son stole her $51 million winning lottery ticket and filed suit against him a California state court.

The saga began in May 2011 when Etta May Urquhart of Bakersfield, Calif., checked the newspaper and saw that one of the Mega Millions lottery tickets she held contained the winning numbers, according to a declaration Urquhart submitted along with the suit filed on April 23.

Then she asked her son, Ronnie Lee Orender, to double-check that the numbers matched up. When the good news was indeed confirmed, Urquhart drove to the gas station where she had bought the ticket with Orender and her husband, according to Urquhart's declaration.

When Urquhart arrived at the gas station, lottery officials were already there awaiting her arrival. In her declaration, Urquhard claims she was so overwhelmed that she had her son endorse the winning ticket:

"I was very emotional the entire time," Urquhart claimed in the declaration. "Lottery officials requested the winning ticket be signed, but I could not even hold a pen. I was told that it did not matter who signed the ticket. My son Ronnie Orender signed the ticket on my behalf."

Orender told Urquhart he would handle the money, according to the declaration.

"I told him I wanted to take care of our family and he told me he would do that for me," Urquhart wrote in the declaration.

On May 5, 2011, lottery officials announced Orender was the winner of the lottery jackpot, according to Urquhart's complaint. At a press conference, both Urquhart and Orender appeared in person to claim the lump sum winnings, which totaled $32.3 million before taxes, according to the Examiner.

Orender gave his mother the money to purchase the ticket, the Examiner reported at that time, but Urquhart has alleged in court documents that she bought the ticket with her retirement savings.

Urquhart had played the lottery for 18 years, purchasing tickets twice weekly, according to her declaration.

"Ronnie Orender was not supportive of my weekly lottery ticket purchases. He discouraged me from playing and told me it was a waste of my money," Urquhart wrote in the declaration.

After collecting the winnings, Orender went on a shopping spree, purchasing four homes and 10 cars, a watercraft and a motor home, according to Urquhart's complaint. Additionally, court documents allege Orender made cash gifts of about $350,000 to his daughters.

"Ronnie Orender is my son, and I lived with him for over 18 years," Urquhart wrote in the declaration. "I know Ronnie Orender does not have any means to make the purchases or cash gifts described in this declaration with any monies other than those received from my lottery winnings."

"Of the total lottery winnings received, I have received approximately $125,000 in cash, a Lincoln SUV and I have been provided a house to live in, but I am not the owner of the house," Urquhart said.

Calls to Orender were not immediately returned on Friday.

Barry Goldner, Urquhart's attorney, told The Huffington Post that he has not heard from Orender or from any lawyers on his behalf since the suit was filed.

Urquhart and her husband, Bob, are seeking $32 million in damages for fraud, conspiracy to commit fraud, conversion, constructive trust and financial elder abuse, according to the complaint, which was filed in Kern Superior Court on April 23.

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Corporations Raking In Money At Prerecession Levels, But Not Hiring

Corporations Raking In Money At Prerecession Levels, But Not Hiring:
It's a good time to be an American corporate executive, but not such a great time to be a job seeker.

That's because U.S. corporate profits have returned to prerecession levels, but hiring and investment have not, according to a report by the International Institute for Labour Studies released on Friday. Corporate profits, which keep hitting all-time highs, are back to their prerecession levels of about 15 percent of gross domestic product, according to the report.

Record company profits have come at the expense of investment and hiring, according to the report. Business investment is now hovering at about 16.5 percent of GDP -- far below the prerecession average of 20 percent, according to the institute. Corporations are holding onto an "unprecedented" amount of cash because of lingering concerns about the economy's weakness, the report stated.

U.S. employers added just 115,000 jobs in April, the Labor Department reported on Friday. These additions are keeping up with the population's growth but not making up for the 11.6 million jobs lost as a result of the recession, according to economists. The labor force participation rate plunged to its lowest level since 1981: 63.6 percent.

Kathy Bostjancic, director for macroeconomic analysis at the Conference Board, said in an interview with The Huffington Post on Friday that investment spending has been "among the slowest we've seen."

But corporate executives are in a "prisoner's dilemma," she said: Though corporations would benefit from the strengthening economy that would result if they all started investing and hiring at the same time, company officials are nervous about blazing a trail out in the open.

"It's very difficult to stand out like that and to be bold because if no one else is doing it, and you're proven wrong, you could be penalized," Bostjancic said. "If the economy does turn down, then you've over-hired, you've over-invested."

Even without hiring many more workers, companies have still managed to profit. That's because major corporations have been squeezing more out of their employees while letting their workers' inflation-adjusted wages fall. Meanwhile, worker productivity has spiked over the past few years as employees worked harder.

"Most of the productivity gains have gone to corporate America and stock prices," Bostjancic said. "The income gains are going more to corporate America and the top line than they are going to the worker."

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Bruce Judson: Let's Risk Destroying the Housing Market and Any Economic Recovery!

Bruce Judson: Let's Risk Destroying the Housing Market and Any Economic Recovery!:
The economic crisis began with the housing crisis, and it will only end when the housing crisis also ends. Unfortunately, the evidence of the past five years suggests that the Obama administration and Congress have never actually understood this connection. Despite massive numbers of foreclosures, the loss of almost $7 trillion in housing wealth (over one-half the nation’s home equity), and even unprecedented pleas from the Chairman of the Federal Reserve, there has been a shocking paucity of innovation or even policy activity in the housing arena.
Now there is a a very real chance that Congress will destroy the limited policies the Obama administration does have in place, prevent additional efforts, and further widen the gap between the haves and have-nots in America. Moreover, the net effect of this congressional failure could be to further undermine the weak housing market and risk sending the nation into another economic tailspin.
The administration’s signature housing policy effort is now aimed at mortgage principal reductions. This effort is at the core of the multi-state robo-mortgage settlement and central to the administration’s criticism of Edward DeMarco, the acting director of the Federal Housing Finance Agency. From the perspective of many analysts, myself included, the administration is finally on the right track, but its efforts are far too minimal to make a meaningful difference. Indeed, the nation’s total negative equity (the amount of mortgage debt owed which exceeds the value of the underlying properties) is presently in the range of $700 billion, and it's likely to increase.
Nonetheless, the administration’s principal reduction efforts are a step in the right direction. These efforts open the door for the far larger, far more creative efforts that will ultimately be needed to prevent millions of upcoming foreclosures and possibly massive walk-aways from the estimated 23 percent (and increasing) of all mortgage holders -- 11 million families -- who are underwater.
Here’s the issue: As a general rule, any debt forgiveness is income. This means that if a home buyer borrows to buy a house and the bank forgives a portion of the loan, whether in a short sale, through debt reduction (i.e. the settlement), or even foreclosure in states that allow banks to officially choose not to seek recourse, a taxable event has occurred. The income earned is the difference between the original mortgage borrowed and the amount ultimately repaid to the bank.
For example: A family borrows $300,000 for a mortgage. The home declines in value and the bank agrees to a short sale (where the sale price is for less than the amount of the homeowner’s mortgage debt) and receives a total pay-off of $200,000. The $100,000 difference between the amount borrowed and the amount ultimately paid back is the amount of the loan the bank has forgiven. This $100,000 is a type of principal reduction and generally subject to ordinary income taxes.
However, at the start of the housing crisis in 2007, Congress enacted the Mortgage Forgiveness Debt Relief Act of 2007, which exempts precisely this phantom income from federal taxation. The term of the law was extended in 2008. But the current law expires at the end of 2012, and it is by no means clear that it will be extended. Moreover, the seeming lack of public discussion about the need to extend it is shocking.
(There are a complex array of qualifying circumstances and exemptions surrounding this tax issue, including the laws of the individual state involved, the solvency of the homeowner, whether the homeowner is in bankruptcy, whether the sale involves a primary residence, refinancing associated with the property, and a variety of other factors related to qualifying for the federal exemption. In particular, short sales in nonrecourse states (which include California) are not considered debt forgiven and therefore, if no other income-generating activities apply, do not trigger federal taxes. But this article does not address the many nuances involved in these issues.)
It’s virtually impossible to imagine that struggling families who are selling underwater homes at a large loss (and have already lost a large chunk of their life savings as the value of their home equity, including their down-payment, was vaporized in the housing crisis) will go forward with short sales. The vast majority of homeowners will not be able to afford the resulting tax debt. So one consequence of a failure to extend this law is likely to be an immediate end to the vast majority of short sales, which have been increasing rapidly. Short sales constituted an estimated 24 percent of all January 2012 home sales and surpassed the estimated 20 percent of all January sales comprised of foreclosed homes.
For the same reasons, all efforts at principal reduction will be stopped cold at the end of this year. Homeowners who are struggling to meet their monthly obligations are unlikely to be able to accept sizeable principle reductions that will create large income tax obligations that they can't afford. This means Obama's debt principal reduction initiative will never get off the ground.
Congressional opponents of renewing this legislation estimate that the cost of extending the exemption at $2.7 billion, a large enough cost to lead them to oppose the measure. Members of Congress may also oppose extending the exemption as an unfair benefit to individuals whom they deem irresponsible, which is subsidized by taxpayers who did the right thing and paid off their mortgages. Finally, in this election year, it’s easy to imagine that legislation of all kinds could become hostage to partisan gridlock.
The source of this cost Congressional cost estimate is unknown. But, it is almost certainly wrong.  It appears to assume that without this exemption short sales will continue to dominate the fragile housing market, thereby generating new income tax revenues. In fact, the best conclusion is that, if the exemption disappears, so will short sales and any accompanying tax revenues. The real cost of failing to extend this exemption is the unacceptable risks it poses to any housing recovery and the economy at large. The idea that tax revenues will be lost is a fiction.
Moreover, arguments related to individual responsibility are disingenuous. Over the past several years financial executives have avoided accountability for their actions. Indeed, there have been no substantive congressional hearings on massive law-breaking by financial executives, such as the congressionally sponsored Pecora Hearings in the era of the New Deal.
I would suggest that these disingenuous arguments by some members of Congress are a further indicator of the consequences of extreme inequality afflicting the nation. They demonstrate an unacceptable double-standard: One set of laws and permissive irresponsibility for those at the top of the society, and one set of rules for everyone else. They also vividly demonstrate a natural consequence of extreme inequality: Societies grow harsher. As inequality increases, those at the top lose empathy for the less fortunate, including the formerly middle class. As a result, the elites lose their view of the nation as one community, and rationalize actions of all types that they would find abhorrent if the shoe were on the other foot.
Congressional opponents of renewing this legislation are assuming a lack of potentially severe consequences. It’s impossible to predict what might happen, but the downside risks are unquestionably high. It raises the real risk of directly leading housing prices to decline further or even plummet for a variety of reasons. Efforts at principal reduction could come to a stop as the public loses confidence in a housing recovery, the end of short sales could have a strong negative impact on the housing market, or underwater homeowners fearing tax consequences could decide to walk away from their homes, leading to a massive increase in the inventory of newly empty homes that banks must ultimately resell.
None of this may happen, but the risks are real and unacceptable. A substantial drop in housing prices will almost certainly harm or destroy the already tepid pace of our economic recovery. Congress and the Obama administration are playing with fire. Sometimes those who do so remain unscathed, but sometimes they get burned.
Congressional inaction also fails the pro-capitalism test. As an economic system, capitalism is intended to build the overall wealth of a society. To properly function, capitalism requires an equal playing field, absolute accountability for business decisions, and rules ensuring that markets function fairly. As I have repeatedly argued, the many failures of lawmakers and administration officials to hold the financial services sector to a capitalist model has created a financial sector that is anti-capitalist and wealth-destroying. The current predicament of homeowners who might rely on this lifeline is a direct result of this failure. To now penalize the weakest link in the chain is a further demonstration that we have created an economic system that is not fair capitalism, where everyone lives up to their responsibilities and is accountable for their actions.
Capitalism only works when the citizenry believes it leads to fair outcomes. Our nation has already reached dangerous levels of anger. The lack of trust in our institutions is pervasive, and Americans who have always been regarded as optimists have turned cynical and lost hope. By taxing struggling families on phantom income, Congress will reinforce the belief that our economy is blatantly unfair and further wear away the remaining thread of our painfully frayed social fabric.
An earlier version of this articled appeared as part of the Restoring Capitalism series at The Next New Deal, a project of the Roosevelt Institute.

All the posts are provided by me and any comments l provide are my own view of the markets and are not the views of the article writer and or news provider.

One Upside To The Sluggish Economy: Cheap Wine

One Upside To The Sluggish Economy: Cheap Wine:

* Volume seen rising 3.5 pct to 4 pct this year
* Company launching new-flavored Svedka vodka
* Shares down 2.6 pct, market down 1.2 pct (Adds quotes, background, bullet points)
By Martinne Geller
NEW YORK, May 4 (Reuters) - The U.S. economy remains too delicate for Constellation Brands Inc to lead any attempt to raise wine prices, even as a smaller harvest is expected to make grapes more expensive, a senior executive said on Friday.
As a result, the world's largest maker of branded wine, with names like Robert Mondavi and Ravenswood, does not expect to raise prices this year -- unless other producers do so first.
"We're not going to lead the charge," said Constellation Brands Chief Financial Officer Bob Ryder in an interview.
Ryder said Constellation was paying close attention to what competitors were doing about prices, but said that as of yet, it was hard to see any big price increases this year. That could squeeze margins for the whole industry.
The latest evidence of how fragile the U.S. economic recovery is came Friday when the April employment report showed that the pace of hiring slowed.
Still, Ryder said consumers could see fewer discounts or promotions on wines as producers seek to offset expected increases in grape prices due to the smaller harvest.
While Constellation owns some vineyards, particularly in California's Napa and Sonoma regions, the vast majority of the wine it makes comes from purchased grapes.
Wine volume for the industry should grow about 3.5 percent to 4 percent this year, and Constellation expects to keep up that pace, Ryder said. He added though that more expensive wines are selling more swiftly than cheaper bottles.
Silicon Valley Bank, a banker to the wine industry, said last month that it expected vintners to raise prices as the supply of grapes declines.
Constellation last month forecast earnings for the fiscal year that were below Wall Street estimates as it spends more to market new products.
As opposed to growing primarily through acquisitions, as Constellation had done in the past, Ryder said the upstate New York-based company was now focusing inward on driving its own profitable growth organically.
In addition to new wines like Simply Naked and Primal Roots, Constellation is launching more flavors of its Svedka vodka, Ryder said.
Constellation shares were down 58 cents, or 2.6 percent, at $21.13 in morning trade on the New York Stock Exchange, slightly underperforming the wider market, which was down 1.2 percent. (Editing by Gerald E. McCormick and Leslie Gevirtz)

#AceNewsServices

Thursday 26 April 2012

While Student Debtors Suffer


Ace News Desk,
 ,,
When it comes to spending other peoples' money, student loan executives have put in enough credit hours to earn a PhD.D. While college students were busy becoming tomorrow's doctors and lawyers, these predatory execs were learning the art of falconry and studying their 4,000 gallon shark tanks. These and other extravagant expenses are being funded from the pockets of today's college students, a new release from consumer advocacy site CreditCardAssist.com reveals.

Currently, the total student loan debt is sitting just atop $1 trillion, with numbers only expected to grow. These loans are, for the most part, unregulated – people who don't even qualify for a credit card are able to take out loans in excess of $100,000. “This is legalised entrapment,” says CreditCardAssist.com founder Bill Hazelton. “These lenders are fleecing a bunch of students who don’t know any better and couldn’t do anything about it even if they did. Something needs to change, and soon.”

Please email me at my blog at idadamchristian.newsandviews@blogger.com and let me know your news and views and l will publish it on my blog network need to view my profile at https://profiles.google.com/102638977070610790243/about?hl=en 


Or share on the social media network using my discus box and let your followers in on your news and views on #Ace News Services

All the posts are provided by me and any comments l provide are my own view of the markets and are not the views of the article writer and or news provider.

Monday 26 March 2012

Are Shares As Good As They Look?


These sort of statistics are beginning to put the world in financial jeopardy and people seem to continue to ignore signs of the times. These types of comments are ignored in favour of doing a deal, selling shares or products off the back of other peoples debt misery. A typical comment maybe as follows with a heading starting
The grim signal that Apple just delivered to the markets  - just to alarm the market and get interested parties to read more or investigate what it means. Next we reel in the [mug] sorry investor and this has to really get their interest like this - For much of the last 20 years, the prize for the biggest business on the globe has alternated between Microsoft, Exxon Mobil and General Electric. But now one company towers over everyone else – Apple. 
Having hooked the [Fish] they follow up with - Then we read that Apple is going to release some of its amazing $100bn cash pile back to investors. The first dividend in 17 years. What should we read into that? (I’ll tell you in a second).
WAIT WAIT - we are now about to tell you a real FACT to make sure you do not wriggle off the hook they have you on, here it is -
After a remarkably eventful week, Apple then suffered its very own ‘flash-crash’ as shares dropped nearly 10% within minutes and forced a halt in trading.
By now you are staggering at the fact that a company so big can suddenly have such a problem, but wait for it the SALES PATTER STARTS like this - To me, the most important of the three stories is the one that was given least coverage. And that is the mini-crash. Today I want to tell you why I think this is so important and what it could mean for the market at large.
Time to put you in the keep net with - 
There’s no doubt about it. Apple has become a money printing machine. The figures are just mind-boggling. According to The Economist, sales in the last quarter were almost double those the previous year. And forecasts suggest that sales for 2013 will be nearly triple 2010’s figures.
But we need a CLOSER AND HERE IT IS - No wonder the stock has been flying!

FOLLOWED BY-
There’s so much money coming in the door that management literally doesn't know what to do with it all. And that’s why, last week it announced not only a dividend, but also a $10bn share buyback (where the firm buys back its own stock in the market).

Some investors are saying that this shows Apple has reached the end of the road... that’s why it's handing back money to investors – it's got nowhere to invest it! The cynics also point out that management has a nasty habit of initiating share buybacks right at the top of the market. Surely, they say, now the only way for Apple is down.

FINALLY

But I’m not so sure. In reality, the dividend is small, they’re giving shareholders back around $30bn over the next three years. At today’s share price, it’ll give investors a yield just below 2%. And the $10bn buyback is smaller still. Cash is rolling in quicker than these giveaways are paying out. 

Convincing anyone that stocks can go up and down but by buying these shares at such a good price namely 10% less you as an investor could be the winner. But as with all shares they do go up and down and a final comment like this one just SEALS THE DEAL like this one - 
With Apple’s shares trading on a relatively sober forecast p/e of less than 14 times for 2012, the market clearly isn’t expecting loads of growth. That could leave some upside for investors. 
 
Last week it was announced that the value of Apple is now roughly the same as the whole US retail sector. Think about that for a second... there are some big businesses in the US retail sector – and Apple is worth the same as all of them put together!

These types of  cases are putting people in a mess everyday and believe me not everyone makes money on the shares they buy, more rather than less make a lose.

So be careful do not believe everything you read as you may be being manipulated without even knowing it!
 
All the posts are provided by me and any comments l provide are my own view of the markets,with extracts from various articles and posts l have read.

http://acefinancenews.blogspot.com/

Wednesday 25 January 2012

" One Persons Story Of Being In Debt"

Have you ever considered how to borrow money when you really need help and guidance maybe listening to this story you will be able to appreciate how other people can help you. This is one such account of Lissette and is well worth a listen and please comment using our comments box.

All the posts are provided by me and any comments l provide are my own view of the markets and are not the views of the article writer and or news provider.

" Pay Day Loans And The Consumer Financial Protection Bureau

These loans originally started in the US and are now commonplace in the UK and are not the type of funds anyone should be contemplating as an easy fix solution to short term borrowing. If you are or need advice leave a comment but can l suggest you listen to this video and it may help you to avoid the problems that you may have with this type of lending.

I will be writing more on this subject very shortly and providing in depth terms and conditions of lenders you should avoid and those that are not as bad.  

All the posts are provided by me and any comments l provide are my own view of the markets and are not the views of the article writer and or news provider.

NB Please ignore the note about comments being closed as it applies to youtube and not our our comments box, you can log into any social media and share this we need to spread the word.