May 18

Today’s News 18th May 2016

  • The Fed Needs to Raise Rates at the June and December Meetings (Video)

    By EconMatters

     

    It is obvious that the unintended consequences of ZIRP have destroyed financial market structure which ultimately flows through to the broader economy.

    All the financials, the layoffs on Wall Street, and the way assets are trading in the financial markets in general illustrate that financial markets are not healthy right now, and slowly deteriorating every year since the initial benefits of the sugar induced euphoric high of Quantitative Easing Policies by Central Banks around the world has burned off.

    An orderly exit by central banks is the best possible solution for trying to resuscitate some semblance of normal functioning financial market pricing mechanisms for assets around the globe.

    © EconMatters All Rights Reserved | Facebook | Twitter | YouTube | Email Digest | Kindle   

  • Undeniable Evidence That The Real Economy Is Already In Recession

    Submitted by Michael Snyder via The Economic Collapse blog,

    You are about to see a chart that is undeniable evidence that we have already entered a major economic slowdown. 

    In the “real economy”, stuff is bought and sold and shipped around the country by trucks, railroads and planes.  When more stuff is being bought and sold and shipped around the country, the “real economy” is growing, and when less stuff is being bought and sold and shipped around the country, the “real economy” is shrinking.

    I know that might sound really basic, but I want everyone to be on the same page as we proceed in this article. 

    Just because stock prices are artificially high right now does not mean that the U.S. economy is in good shape.  In fact, there was a stock rally at this exact time of the year in 2008 even though the underlying economic fundamentals were rapidly deteriorating.  We all remember what happened later that year, so we should not exactly be rejoicing that precisely the same pattern that we witnessed in 2008 is happening again right in front of our eyes.

    During the month of April, the Cass Transportation Index was down 4.9 percent on a year over year basis.  What this means is that a lot less stuff was bought and sold and shipped around the country in April 2016 when compared to April 2015.  The following comes from Wolf Richter…

    Freight shipments by truck and rail in the US fell 4.9% in April from the beaten-down levels of April 2015, according to the Cass Transportation Index, released on Friday. It was the worst April since 2010, which followed the worst March since 2010. In fact, shipment volume over the four months this year was the worst since 2010.

     

    This is no longer statistical “noise” that can easily be brushed off.

    Of course this was not just a one month fluke.  The reality is that we have now seen the Cass Shipping Index decline on a year over year basis for 14 consecutive months.  Here is more commentary and a chart from Wolf Richter…

    The Cass Freight Index is not seasonally adjusted. Hence the strong seasonal patterns in the chart. Note the beaten-down first four months of 2016 (red line):

     

    Cass Freight Index - Wolfstreet

    This is undeniable evidence that the “real economy” has been slowing down for more than a year.  In 2007-2008 we saw a similar thing happen, but the Federal Reserve and most of the “experts” boldly assured us that there was not going to be a recession.

    Of course then we immediately proceeded to plunge into the worst economic downturn since the Great Depression of the 1930s.

    Traditionally, railroad activity has been a key indicator of where the U.S. economy is heading next.  Just a few days ago, I wrote about how U.S. rail traffic was down more than 11 percent from a year ago during the month of April, and I included a photo that showed 292 Union Pacific engines sitting in the middle of the Arizona desert doing absolutely nothing.

    Well, just yesterday one of my readers sent me a photograph of a news article from North Dakota about how a similar thing is happening up there.  Hundreds of rail workers are being laid off, and engines are just sitting idle on the tracks because there is literally nothing for them to do…

    North Dakota Railroad Engines Idle

    Intuitively, does it seem like this should be happening in a “healthy” economy?

    Of course not.

    The reason why this is happening is because businesses have been selling less stuff.  Total business sales have now been declining for almost two years, and they are now close to 15 percent lower than they were in late 2014.

    Because sales are way down, unsold inventories are really starting to pile up.  The inventory to sales ratio is now close to the level it was at during the worst moments of the last recession, and many analysts expect it to continue to keep going up.

    Why can’t people understand what is happening?  So far this year, job cut announcements are up 24 percent and the number of commercial bankruptcies is shooting through the roof.  Signs that we are in the early chapters of a new economic downturn are all around us, and yet denial is everywhere.

    For instance, just consider this excerpt from a CNBC article entitled “This key recession signal is broken“…

    Treasury yields are behaving as if they are signaling a recession, but strategists say this time it’s more likely a sign of something else.

     

    The market has been buzzing about the flattening yield curve, or the fact that yields on longer duration Treasurys are getting closer to yields on shorter duration securities.

     

    In the case of 10-year notes and two-year notes, that spread was the flattest Friday than it has been on a closing basis since late 2007. The yield curve had turned negative in 2006 and stayed there for months in 2007 before turning higher ahead of the Great Recession. The spread was at 95 at Friday’s curve but widened Monday to more than 96.

    Treasury yields are very, very clearly telling us that a new recession is here, but because the “experts” don’t want to believe it they are telling us that the signal is “broken”.

     

     

    For many Americans, all that seems to matter is that the stock market has recovered from the horrible crashes last August and earlier this year.  But in the end, I am convinced that those crashes will simply be regarded as “foreshocks” of a much greater crash in our not too distant future.

    But if you don’t want to believe me, perhaps you will listen to Goldman Sachs.  They just came out with six reasons why stocks are about to tumble.

    Or perhaps you will believe Bank of America.  They just came out with nine reasons why a big stock market decline is on the horizon.

    To me, one of the big developments has been the fact that stock buybacks are really starting to dry up.  In fact, announced stock buybacks have declined 38 percent so far this year…

    After snapping up trillions of dollars of their own stock in a five-year shopping binge that dwarfed every other buyer, U.S. companies from Apple Inc. to IBM Corp. just put on the brakes. Announced repurchases dropped 38 percent to $244 billion in the last four months, the biggest decline since 2009, data compiled by Birinyi Associates and Bloomberg show. “If the only meaningful source of demand in the market is companies buying their own shares back, then what happens if that goes away?” asked Brad McMillan, CIO of Commonwealth “We should be concerned.”

    Stock buybacks have been one of the key factors keeping stock prices at artificially inflated levels even though underlying economic conditions have been deteriorating.  Now that stock buybacks are drying up, it is going to be difficult for stocks to stay disconnected from economic reality.

    A lot of people have been asking me recently when the next crisis is going to arrive.

    I always tell them that it is already here.

    Just like in early 2008, economic conditions are rapidly deteriorating, but the stock market has not gotten the memo quite yet.

    And just like in 2008, when the financial markets do finally start catching up with reality it will likely happen very quickly.

    So don’t take your eyes off of the deteriorating economic fundamentals, because it is inevitable that the financial markets will follow eventually.

  • Obama: Worst President In U.S. History?

    Bush was a horrible president. At the time, I thought he was the worst president in American history.

    But Obama has made a lot of firsts himself …

    For example, Obama:

    • Sentenced whistleblowers to 31 times the jail time of all prior u.s. presidents combined
    • Has granted less pardons than any president since Garfield, who served only 200 days as president before being assassinated in 1881
    • May be the only U.S. president in history who failed to deliver a single year of at least 3% economic growth (when adjusted for inflation)

    In addition, Obama has presided over:

    And as the New York Times notes this week, Obama has been at war longer than any president in history.

    Worst … president … ever.

  • Welcome To 1984

    Authored by Chris Hedges, originally posted at TruthDig.com,

    The artifice of corporate totalitarianism has been exposed. The citizens, disgusted by the lies and manipulation, have turned on the political establishment. But the game is not over. Corporate power has within its arsenal potent forms of control. It will use them. As the pretense of democracy is unmasked, the naked fist of state repression takes its place. America is about—unless we act quickly—to get ugly.

    “Our political system is decaying,” said Ralph Nader when I reached him by phone in Washington, D.C. “It’s on the way to gangrene. It’s reaching a critical mass of citizen revolt.”

    This moment in American history is what Antonio Gramsci called the “interregnum”—the period when a discredited regime is collapsing but a new one has yet to take its place. There is no guarantee that what comes next will be better. But this space, which will close soon, offers citizens the final chance to embrace a new vision and a new direction.

    This vision will only be obtained through mass acts of civic mobilization and civil disobedience across the country. Nader, who sees this period in American history as crucial, perhaps the last opportunity to save us from tyranny, is planning to rally the left for three days, from May 23 to May 26 at Constitution Hall in Washington, D.C., in what he is calling “Breaking Through Power” or “Citizen’s Revolutionary Week.” He is bringing to the capital scores of activists and community leaders to speak, organize and attempt to mobilize to halt our slide into despotism.

    “The two parties can implode politically,” Nader said. “They can be divided by different candidates and super PACs. But this doesn’t implode their paymasters.”

    “Elections have become off-limits to democracy,” he went on. “They have become off-limits to democracy’s fundamental civil community or civil society. When that happens, the very roots shrivel and dry up. Politics is now a sideshow. Politics does not bother corporate power. Whoever wins, they win. Both parties represent Wall Street over Main Street. Wall Street is embedded in the federal government.”

    Donald Trump, like Hillary Clinton, has no plans to disrupt the corporate machinery, although Wall Street has rallied around Clinton because of her predictability and long service to the financial and military elites. What Trump has done, Nader points out, is channel “the racist, right-wing militants” within the electorate, embodied in large part by the white working poor, into the election process, perhaps for one last time.

    Much of the left, Nader argues, especially with the Democratic Party’s blatant rigging of the primaries to deny Bernie Sanders the nomination, grasps that change will come only by building mass movements. This gives the left, at least until these protofascist forces also give up on the political process, a window of opportunity. If we do not seize it, he warns, we may be doomed.

    He despairs over the collapse of the commercial media, now governed by the primacy of corporate profit.

    “Trump’s campaign has enormous appeal to the commercial mass media,” Nader said. “He brought huge ratings during the debates. He taunted the networks. He said, ‘I’m boycotting this debate. It’s going to cost you profit.’ Has this ever happened before in American history? It shows you the decay, the commercialization of public elections.”

    The impoverished national discourse, fostered by a commercial mass media that does not see serious political debate as profitable and focuses on the trivial, the salacious and the inane, has empowered showmen and con artists such as Trump.

    “Trump speaks in a very plain language, at the third-grade level, according to some linguists,” Nader said. “He speaks like a father figure. He says, ‘I’ll get you jobs. I’ll bring back industry. I’ll bring back manufacturing. I’ll protect you from immigrants.’ The media never challenges him. He is not asked, ‘How are we going do all of this? What is step one? Step two? Is the White House going to ignore the Congress and the courts?’ He astonishes his audience. He amazes them with his bullying, his lying, his insults, like ‘Little Marco,’ the wall Mexico is going to pay for, no more entry in the country by Muslims—a quarter of the human race—until we figure it out. The media never catches up with him. He is always on the offensive. He is always news. The commercial media wants the circus. It gives them high ratings and high profit.”

    The focus on info-entertainment has left not only left the public uninformed and easily manipulated but has locked out the voices that advocate genuine reform and change.

    “The commercial media does not have time for citizen groups and citizen leaders who are really trying to make America great, whether by advancing health safety or economic well-being,” Nader bemoaned. “These groups are overwhelmed. They’re marginalized. They’re kept from nourishing the contents of national, state and local elections. Look at the Sunday news shows. No one can get on to demonstrate that the majority of the people want full Medicare for all with the free choice of doctors and hospitals, not only more efficient but more life-saving. There was a major press conference a few days ago at the National Press Club. The leading advocates of full Medicare for all, or single-payer, were there, Dr. Steffie Woolhandler and Dr. Sidney Wolfe, the heads of Physicians for a National Health Program. This is a group with about 15,000 physicians on board. Nobody came. There was a stringer for an indie media outlet and the corporate crime reporter. There are all kinds of major demonstrations, 1,300 arrests outside the Congress protesting the corruption of money in politics. Again no coverage, except a little on NPR and on ‘Democracy Now!’ ”

    “The system is gamed,” he said. “The only way out of it is to mobilize the civil society.

    “We are organizing the greatest gathering of accomplished citizen advocacy groups on the greatest number of redirections and reforms ever brought together in American history under one roof,” he said of his upcoming event. “The first day is called Breaking Through Power, How it Happens. We have 18 groups who have demonstrated it with tiny budgets for over three decades on issues such as road safety, removing hundreds of hazardous or ineffective pharmaceuticals from the market, changing food habits from junk food to nutrition and rescuing people from death row who were falsely convicted of homicides. What if we tripled the budgets and the staffs of these groups? Eighteen of these groups have a total budget that is less than what one of dozens of CEOs make in a year.”

    Nader called on Sanders to join in the building of a nationwide civic mobilization. He said that while Clinton may borrow some of his rhetoric, she and the Democratic Party establishment would not incorporate Sander’s populist appeals against Wall Street into the party platform. If Sanders does not join a civic mobilization, Nader warned, there would be “a complete disintegration of his movement.”

    Nader also said he was worried that Clinton’s high negativity ratings, along with potential scandals, including the possible release of her highly paid speeches to corporations such as Goldman Sachs, could see Trump win the presidency.

    I have her lecture contract with the Harry Walker lecture agency,” he said. “She had a clause in the contract with these business sponsors, which basically said the doors will be closed. There will be no press. You will pay $1,000 for a stenographer to give me, for my exclusive use, a stenographic record of what I said. You will pay me $5,000 a minute. She has it all. She can’t say, ‘We will look into it or we’ll see if we can find it.’ She has been dissembling. And her latest rant is, ‘I’ll release the transcripts if everyone else does.’ ‘Who is everybody else?’ as Bernie Sanders rebutted. He doesn’t give highly paid speeches behind closed doors to Wall Street firms, business executives or business trade groups. Trump doesn’t give quarter-of-a-million-dollar speeches behind closed doors to business. So by saying ‘I will release all of my transcripts if everyone else does,’ she makes a null and void assertion. This is characteristic of the Clintons’ dissembling and slipperiness. It’s transcripts for Hillary. It’s tax returns for Trump.”

    While Nader supports the building of third parties, he cautions that these parties—he singles out the Green Party and the Libertarian Party—will go nowhere without mass mobilization to pressure the centers of power. He called on the left to reach out to the right in a joint campaign to dismantle the corporate state. Sanders could play a large role in this mobilization, Nader said, because “he is in the eye of the mass media. He is building this rumble from the people.”

    “What does he have to lose?” Nader asked of Sanders. “He’s 74. He can lead this massive movement. I don’t think he wants to let go. His campaign has exceeded his expectations. He is enormously energized. If he leads the civic mobilization before the election, whom is he going to help? He’s going to help the Democratic Party, without having to go around being a one-line toady expressing his loyalty to Hillary. He is going to be undermining the Republican Party. He is going to be saying to the Democratic Party, ‘You better face up to the majoritarian crowds and their agenda, or you’re going to continue losing in these gerrymandered districts to the Republicans in Congress.’ These gerrymandered districts can be overcome with a shift of 10 percent of the vote. Once the rumble from the people gets underway, nothing can stop it. No one person can, of course, lead this. There has to be a groundswell, although Sanders can provide a focal point”

    Nader said that a Clinton presidency would further enflame the right wing and push larger segments of the country toward extremism.

    “We will get more quagmires abroad, more blowback, more slaughter around the world and more training of fighters against us who will be more skilled to bring their fight here,” he said of a Clinton presidency. “Budgets will be more screwed against civilian necessities. There will be more Wall Street speculation. She will be a handmaiden of the corporatists and the military industrial complex. There comes a time, in any society, where the rubber band snaps, where society can’t take it anymore.”

  • Congressman Exposes Porn Habit With 'Innocent' Facebook Post

    Well that's embarrassing…

    Meet 'Conservative' Mike Webb – he is running for U.S. Congress in Virginia's 8th District, and he would appreciate your vote.

     

    He would also appreciate, as Gawker reports, judging from a screenshot uploaded to his Facebook page earlier today, a little alone time with the pages “IVONE SEXY AMATEUR” and “LAYLA RIVERA TIGHT BOOTY.”

    For over a day now the following screen-grab – showing his investigation into a Human Resources company – has been posted to his campaign page… the only thing is – the 2 far left tabs – based on our deep and lengthy research are pornographic movie sites…

     

    Ok – so we have all done it – come on. But the story gets better, as Webb then offers the following explanation for his surfing habits (please remove all fluids from your mouth before reading)…

    Curious by nature, I wanted to test the suggestion that somehow, lurking out in the pornographic world there is some evil operator waiting for the one in a gazillion chance that a candidate for federal office would go to that particular website and thereby be infected with a virus that would cause his or her FEC data file to crash the FECfile application each time that it was loaded on the day of the filing deadline, as well as impact other critical campaign systems.

     

    Well, the Geek Squad techs testified to me, after servicing thousands of computers at the Baileys Crossroads location that they had never seen any computer using their signature virus protection for the time period to acquire over 4800 viruses, 300 of which would require re-installation of the operating system. We are currently awaiting their attempt at recovery of files on that machine accidentally deleted when they failed to backup files before re-installation, a scenario about which Matthew Wavro speculated openly to me before we were informed by the Geek Squad that that had indeed occurred….

     

    But, now let me tell you the results of my empirical inquiry that introduced me to Layla and Ivone. Around Powerball lottery time, January 9, 2016, I calculated the odds that my friend Rev. Howard John Wesley and I working independently arrived at the same prayer plan, and I was able to determine that there was about a one in a billion chance that that could have occurred in the way that it did. (https://www.facebook.com/search/top/…). Well, as much as folks like Duffy Taylor want to hope that the Devil is waiting for Christian candidates on a particular pornographic website to infect his or her FEC data file is even more improbable than my Paul and Silas story, and I know that Duffy Taylor is not a man of faith belief; so, I don’t know how he empirically arrives at his conclusion. I couldn’t see the probability or possibility without a RAND computer.

     

    But, that is the news that will never be printed, but no matter. We found a few more “silent majority” worms today, but we also picked up a few more of the faithful. So, not a bad day, at all.

    As one witty Twitter-er quipped… What's more embarrassing, the porn tabs or the fact that he is using Yahoo as a search engine? I’m going to go with Yahoo on this one.

  • Middle Class Destitution – A Devastating Tale From America's Heartland

    Submitted by Mike Krieger via Liberty Blitzkrieg blog,

    He had made the drive enough times to already suspect what he might find. Stride Rite had left Huntington for Mexico at the tail end of the recession; Breyers Ice Cream had closed its doors after 100 years. In the weeks after each factory closing in his part of Indiana, Lewandowski had listened to politicians make promises about jobs — high-tech jobs, right-to-work jobs, clean-energy jobs — but instead Indiana had lost 60,000 middle-class jobs in the past decade and replaced them with a surge of low-paying work in health care, hospitality and fast food. Wages of male high school graduates had dropped 19 percent in the past two decades, and the wealth divide between the middle class and the upper class had quadrupled.

     

    “These jobs aren’t the solution so much as they’re part of the problem,” Lewandowski said, and now the result of so much churn was becoming evident all across Indiana and lately in Huntington, too. Fast-food consumption was beginning to tick up. Poverty was up. Foreclosures were up. Meth usage up. Heroin up. Death rate up. In Dan Quayle’s Middle America, one of the biggest news stories of the year had been the case of a mother who had let her three-week-old child suck heroin off her finger.

     

    “Despair is our business, and business is booming,” Lewandowski said…

     

    “This is how it feels to be sold out by your country.”

     

    “It’s pure greed.”

     

    “They wanted to add another 6 feet to their yachts.”

     

    “We’re becoming like a third-world country. We’re going to have nothing left but fast food.”

     

    "Fast food and hedge funds. That’s where we’re going.”

     

    – From the Washington Post article: From Belief to Outrage: The Decline of the Middle Class Reaches the Next American Town

    I write a lot about the middle class. It’s been one of the core themes here at Liberty Blitzkrieg since inception, yet my posts tend to be filled with statistics and sarcasm, and often lack the crucial element of heart. In order to truly connect with the public and shift their sentiments from apathy to action, it’s imperative to create a deep emotional connection. I admittedly have not done a great job in this regard. Fortunately for all of us, Eli Saslow of the Washington Post has done just that.

    I read a lot of articles, and I can’t remember anything that hit me as hard as what he published this past weekend. It tells the tale of the spirit-crushing decimation of the American middle class through the lens of eternal optimist, Chris Setser. Chris is a man who always went above and beyond in order to provide a good life for himself and his family. Working the graveyard shift at an Indiana United Technologies plant so that he could be home when his kids came home from school, Mr. Setser lived his entire life living by the mantra: “Things have a way of working in the end.” Until they didn’t.

    Chris’ transformation from an optimistic Democrat, to a pissed off, jaded Trump supporter, is a microcosm for what’s happening all across the country. Through his eyes, you witness a justified desperation, and a painful recognition that working hard and staying positive simply aren’t good enough in America’s current hollowed out, oligarch-owned, shell company of an economy.

    Below, I provide some excerpts from the article, but these select passages don’t do it justice. I think this piece is so important, it’s imperative you read it in full and share it with everyone you know. The future of America rests upon reversing this pernicious trend.

    From the Washington Post:

    HUNTINGTON, Ind. —Chris Setser worked a 12-hour graveyard shift while his children slept, cleaned the house while they were at school and then went outside to wait for the bus bringing them home. He stood on the porch as he often did and surveyed the life he had built. The lawn was trimmed. The stairs were swept. The weekly family schedule was printed on a chalkboard. A sign near the door read, “A Stable Home Is A Happy Home,” and now a school bus came rolling down a street lined by wide sidewalks and American flags toward a five-bedroom house on the corner lot.

     

    “Right on time,” Setser called out to the driver, waving to his children as they came off the bus.

     

    In came 14-year-old Ashley, holding a payment notice for a school field trip. “Are we going to become one of those families with a voucher?” she asked.

    “Don’t worry,” he said, handing her $20 from his wallet.

     

    All around him an ideological crisis was spreading across Middle America as it continued its long fall into dependency: median wages down across the country, average income down, total wealth down in the past decade by 28 percent. For the first time ever, the vaunted middle class was not the country’s base but a disenfranchised minority, down from 61 percent of the population in the 1970s to just 49 percent as of last year. As a result of that decline, confusion was turning into fear. Fear was giving way to resentment. Resentment was hardening into a sense of outrage that was unhinging the country’s politics and upending a presidential election.

     

    Setser had heard rumors earlier in the day that the company had decided to move its operations to Mexico, but he found them hard to believe. While dozens of other manufactures had left Northeast Indiana, his factory, United Technologies Electronic Controls, or UTEC, was still taking back contracts from China and winning president’s awards for performance. It was the area’s largest employer and also a rare place where America’s fraying social contract had remained mostly intact: Employees helped the factory’s parent corporation earn more than $6 billion in annual profit. In return they got a decent hourly salary with good overtime, bonuses for completing work-training programs, a turkey to take home on Thanksgiving and a ham on Christmas. “Successful businesses improve the human condition,” read one sign posted on the factory wall.

     

    But on that night in February, another announcement had come over the factory speakers, instructing all UTEC employees to report to the cafeteria. The factory manager was standing at the front of the room, holding a piece of paper and reading into a microphone.

     

    “A difficult decision,” he said.

     

    “Relocation is best,” he said.

     

    “Northern Mexico,” he said.

     

    “No questions,” he said, and then he told employees they would have an hour-long break in the cafeteria to process the news before returning to their lines.

     

    Together between his overtime and Bowers’s small salary at another manufacturer in Fort Wayne, they had remained firmly in the middle class by finding ways to make their money stretch. When they wanted to drive to Florida for their first overnight vacation in a decade, Setser could volunteer for more overtime to save up the cash. When they wanted a new TV, he could spend the 10 percent premium he earned for working third shift. He had cashed out part of his 401(k) account to pay for his daughter’s braces, purchased some of their basic household items with credit cards and taken out a no-money-down loan on their $95,000 house.

     

    He had made the drive enough times to already suspect what he might find. Stride Rite had left Huntington for Mexico at the tail end of the recession; Breyers Ice Cream had closed its doors after 100 years. In the weeks after each factory closing in his part of Indiana, Lewandowski had listened to politicians make promises about jobs — high-tech jobs, right-to-work jobs, clean-energy jobs — but instead Indiana had lost 60,000 middle-class jobs in the past decade and replaced them with a surge of low-paying work in health care, hospitality and fast food. Wages of male high school graduates had dropped 19 percent in the past two decades, and the wealth divide between the middle class and the upper class had quadrupled.

     

    “These jobs aren’t the solution so much as they’re part of the problem,” Lewandowski said, and now the result of so much churn was becoming evident all across Indiana and lately in Huntington, too. Fast-food consumption was beginning to tick up. Poverty was up. Foreclosures were up. Meth usage up. Heroin up. Death rate up. In Dan Quayle’s Middle America, one of the biggest news stories of the year had been the case of a mother who had let her three-week-old child suck heroin off her finger.

     

    “Despair is our business, and business is booming,” Lewandowski said. “Workers have lost all agency in their lives. They’ve based their lives on believing in something that turned out to be a lie. They work when they can, for what they can, for as long as they can until it ends.”

     

    As second shift finished in Huntington, several of those UTEC workers gathered at an Applebee’s that displayed construction hats on the wall. Earlier in the day, an employee had been suspended for taping a “Run for the Border” bumper sticker to one of the company’s roving robots — the biggest act of rebellion yet. A few employees had been trying to popularize a boycott of United Technologies products, and others had started using their regular ­10-minute breaks to campaign for Trump in a traditionally Democratic factory. But for the most part their work was continuing unchanged, with attendance steady and factory production on the rise. They couldn’t risk losing their jobs or their UTEC severance packages, so the only way to vent was to come here, where the discussion on this night was of a country in decline.

     

    “This is how it feels to be sold out by your country.”“It’s pure greed.”

     

    “They wanted to add another 6 feet to their yachts.”

     

    “We’re becoming like a third-world country. We’re going to have nothing left but fast food.”

     

    “Fast food and hedge funds. That’s where we’re going.”

     

    “We’re getting to the point where there aren’t really any good options left,” he said. “The system is broken. Maybe its time to blow it up and start from scratch, like Trump’s been saying.”

     

    Krystal rolled her eyes at him. “Come on. You’re a Democrat.”

     

    “I was. But that was before we started turning into a weak country,” he said. “Pretty soon there won’t be anything left. We’ll all be flipping burgers.”

     

    “Fine, but so what?” she said. “We just turn everything over to the guy who yells the loudest?”

     

    “You said it always evens out,” she told him.

     

    “Maybe I was wrong,” he said, but now his voice was quiet.

     

    “You said things just have a way of working.”

     

    “Maybe not,” he said, because with each passing day he was seeing it more clearly. The town was losing its best employer, and all around him stability was giving way to uncertainty, to resentment, to anger, to fear.

    Haunting and heartbreaking. What’s worse, it’s not just in the manufacturing heartland where the middle class is getting pummeled. In fact, the middle class is getting squeezed so badly, many cities now see a need to roll out public housing projects targeting this formerly independent and relatively prosperous demographic.

    Although I previously reported on this as it pertained to the extremely affluent city of Palo Alto in the post, The New “Middle Class” – Making $250,000 a Year in Palo Alto Qualifies for Housing Subsidies, it appears this may be more of a trend than an anomaly.

    As the Wall Street Journal reports in the piece, Rising U.S. Rents Squeeze the Middle Class:

    Rising rents in cities across the nation are hurting the poorest residents, but those who are higher on the income ladder might be bearing the brunt of the pain.

     

    A  study set to be released on Monday shows that a far bigger proportion of middle-class renters in New York were squeezed by rising rents than were the lowest-income renters.

     

    The study by New York University’s Furman Center examined rapidly gentrifying neighborhoods such as Brooklyn’s Williamsburg section and Harlem, where rents jumped 80% and 53%, respectively, between 1990 and 2014. While the share of the poorest families struggling to afford rent in those sections increased by 7.6 percentage points from 2000 to 2014, the share of middle-income households struggling to afford rent jumped 18 percentage points.

     

    In Boston, median asking rents have increased at an annual rate of 13.2% since 2010, far outstripping the 2.4% average annual increase in income. Mayor Marty Walsh has pledged to build 20,000 units of middle-income housing through a mix of initiatives such as rezoning neighborhoods further from the city center and offering tax breaks to developers who build more moderately priced housing.

     

    “We really do spend the vast majority of our resources on low-income families but we know we need to serve the middle income,” said Sheila Dillon, Boston’s chief of housing.

     

    Even in Atlanta, historically one of the most affordable cities for middle-class families, a rapid rise in rents has taken its toll on those families. The city last week passed a new ordinance requiring developers who receive tax breaks to set aside a portion of units aimed at lower-income earners. It is also considering requiring developers to include units targeted at slightly more affluent families, such as teachers and police officers.

     

    New York City has pledged to build or preserve 44,000 units for middle-income families over the next decade. Low-income households “have been straining to pay their rents in these neighborhoods for years, and, as rents continue to rise, households in higher-income tiers are having the same experience,” said a spokeswoman for New York City’s Housing Preservation and Development Department.

    I don’t know about you, but this isn’t the kind of country I want to live in.

  • Sworn Depositions Of Close Clinton Aides Begin This Week

    The FBI’s probe into Clinton’s use of a private server isn’t the only noose that is keeping Clinton (and the State Department) up at night: this week interviews begin in a separate Judicial Watch civil suit, previously profiled here, against key State Department figures, all of whom just happen to be close co-workers of Hillary.

    Accordng to Time, two close Clinton aides, Huma Abedin and Cheryl Mills, will testify under oath this month and next, Judicial Watch announced today. The judge in the case said earlier this month he may force Clinton herself to testify after the first round of interviews is completed. That has set up the prospect of the Democratic front-runner for the White House facing off under oath against one of her most dogged pursuers as early as July, just months before the November election.

    It is telling that Judicial Watch’s potentially big win has come not from any dark conspiracy it has uncovered, but from what it has not. The judge has limited the group to a narrow line of inquiry designed to answer a simple question: why did Clinton set up a private server and use it for all her work e-mails as Secretary of State? Clinton says it was matter of convenience, but over the course of the trial, the judge has given credence to the allegation that she was intentionally thwarting the federal laws ensuring government transparency.

     

    And that’s why the messy, drawn out drama over case No. F-2013-08812 matters. Clinton is no stranger to allegations that amount to nothing. From Whitewater to Benghazi her political opponents have tried and failed to find evidence that she committed a crime. A law enforcement official familiar with the separate FBI investigation into how classified information got onto her private server says there is little evidence of a crime there either, though the probe is continuing.

     

    But Clinton may have violated civil law if she intentionally thwarted FOIA or the Federal Records Act, which requires public officials to take a number of steps to preserve and make public their work related documents, according to experts and judges handling the matter in the courts. Which means that for many voters it will be Clinton’s trustworthiness that is on trial in the FOIA case.

    According to the Wall Street Journal, depositions will also be given under oath by Lewis Lukens, a former deputy assistant secretary of state, and Bryan Pagliano, the IT staffer who set up Clinton’s private server. The interviews are set to begin this week. Pagliano refused to testify in front of Congress last year citing his fith amendment, but has since been offered immunity by the Justice Department in a twist that some say could be the critical break in any objective probe into Hillary’s activities. As a reminder, Huma Abedin has already testified in the FBI’s investigation into Clinton’s use of a private server.

    As is currently the case with the FBI investigation, whether Clinton herself will be forced to testify in the civil suit is unclear.

    Between the FBI investigation, and the civil suit, if Clinton comes away from everything unscathed then it’s time to reassign the nickname “Teflon Don” from John Gotti to Hillary.

    Or not. With support from friends in high places, there is a very good chance that we’ll be seeing Clinton all smiles on a debate stage this fall with not a care in the world about this entire issue. The market agrees: when asked “Will a federal criminal charge be filed against Hillary Clinton in 2016?”, the answer provided by PredictIt bettors is trivial: 24%.

  • Obama's Cuban Ambitions As Seen By Cubans Themselves

    Submitted by Jeff Thomas via InternationalMan.com,

    For half a century, Americans have been largely unable to visit Cuba and have had to rely on the US government and media for an understanding of the political, social and economic conditions there. What has been described as the “American Berlin Wall” has been successful in providing Americans with quite an inaccurate view.

    Throughout this period, those Cubans who exited the island in 1959 (and their descendants) have maintained a propaganda programme that, rightly or wrongly, reflected their desire to return to Cuba and to once again rule it. Additionally, they’ve contributed regularly to both the primary US political parties in order to assure that the blockade would be maintained and that Americans would be kept out until such time as the island could be re-taken.

    This is not to say that all is rosy in Cuba. For the past 25 years or more, I’ve periodically spent time there, observing its developments, beginning with its attempt to recover from the loss of its principle trading partner, the Soviet Union, in the early 1990s. It’s been a rocky road, as Cuba has sought to become an international tourist destination whilst attempting to maintain a closed, communist society. Results have been mixed, to say the least.

    Still, the US government embargo remains in place and Americans have little real understanding of Cuba, or how the Cuban people view the US. All Americans can rely on is the “official view”—reports fed to the US media by their government, which, in turn, are influenced by Miami-based Cubans.

    Recently, Barrack Obama visited Cuba, gave speeches and even walked the streets of Havana, “meeting the people”. Americans have now had time to digest the official US view of that visit, yet, understandably, have no idea whatsoever as to the Cuban view.

    If I could sum up the Cuban people’s perception, based upon discussions with Cubans in Havana after the visit, I’d say that the best word to describe their reaction would be “wary”. Cubans are only too aware that Americans have, for half a century, received a highly one-sided view of anything Cuban and, for the most part, tend to agree with their leaders that any dealings with the US government should be cautious.

    As in any country, there are varied viewpoints and, to be sure, the Cubans who oppose the existing regime to the point that they’ve stolen a boat and braved the seas to escape Cuba, would have a far different view from those who are glad to remain in Cuba.

    A particular concern that they tend to voice is that Americans leaders are arrogant, seeming to believe that they have all the answers for every country and seem to perceive themselves as magnanimous, in offering to unilaterally change other countries “for the better”. In the present instance, they resent Mister Obama stating in a Havana speech that his country is considering diminishing its economic punishment of Cuba, but that, first, he would need to be assured that the Cuban political structure be altered to reflect the American model more closely. As stated by President Raul Castro in the Havana Reporter, “he should not expect the Cuban people to give up their destiny…for which they have made huge sacrifices.”

    A continuing sore in the side of Cuba is the occupation of Guantanamo Bay. Cubans, when confronted with their government’s admitted incarceration of some citizens for political reasons, may respond by reminding Americans that Cubans regard Guantanamo as “the horrible torture center”, housing the US government’s political prisoners. They are bolstered in their view by American presidential candidates who vehemently support the continued violation of the Geneva Convention at Guantanamo. (Most Cubans have television and there’s no restriction on American broadcasts. Cubans therefore know far more about the US than Americans know about Cuba.)

    Again, quoting the Havana Reporter, “The Cuban authorities request for the illegally occupied military territory to be returned, although spokespeople for Obama’s administration say that the subject is not on the agenda for discussion.”

    Again, the American presidential message, as seen from the Cuban perspective, appears to be, “We’ll decide what we will or won’t do for you, and we’ll decide what you’ll do for us.”

    And the discussion is not an isolated one. For many years, the UN has regularly held votes on the legality and morality of the blockade and, in each case, all members except the US and Israel vote for its elimination. Just prior to Mister Obama’s Cuban visit, Federica Mogherini, Vice President of the European Commission, reiterated the UN request for the “rejection of the economic, commercial and financial blockade imposed on Cuba by the US”, which she described as both outdated and illegal.

    In his book, “Obama and the Empire”, Fidel Castro comments, “You state…that your country…would not tolerate any intervention in the hemisphere, reiterating that this right must be respected, while demanding the right to intervene anywhere in the world with the aid of hundreds of military bases and naval, air and space forces distributed across the planet. I ask: Is that the way in which the United States expresses its respect for freedom, democracy and human rights?”

    To be sure, Mister Castro has his own agenda, as do all political leaders, yet his point is well-taken. In spite of US pressure, he has outlasted ten US presidents since 1959. Cuba boasts universal literacy and the lowest rate of violent crime in the hemisphere, whereas, in the US, the percentage of those who are functionally illiterate varies between 15% and 35% (depending on the definition of illiteracy). The US also has both the highest number of prison inmates and the highest percentage of inmates per capita.

    Whether the US or Cuba has the greater claim to the moral high ground is therefore very much an individual assessment.

    But, what’s the view on the street in Havana? What’s the reaction of the average Cuban to the Obama visit? Well, for a start, people in the street, who are accustomed to seeing their leaders with a minimal entourage and few armed guards, were surprised to see a virtual army of suited protectors, making Mister Obama’s stroll through Havana anything but casual.

    Of course, this has become the norm for any American leader, but what message does this convey, when the visitor displays such a show of force?

    In spite of this; however, a young waiter at a bistro in the popular Empedrado Callejón del Chorro commented that, whilst he doubted the sincerity of the visit, anything that brings the two countries closer together can only be an improvement. And, to be sure, younger Cubans are more likely than the previous generations to acknowledge that the inevitable passage out of the Castro’s leadership may be overdue, but that a softening of Cuban distrust of the “American imperialists” can only take place if the American government learns to regard Cuba as a sovereign nation, not as a whipping boy.

    And, of course, this is a sentiment that we see worldwide. The more the US positions itself as the world’s policeman, the more it alienates the peoples of other countries. At a time when the US has begun its economic decline, it would do well to soften its approach, yet it is clearly doing the exact opposite. This does not bode well for the US. No one likes a bully. Bullies are typically only tolerated until they weaken. When this occurs, people turn on the bully, whether he is a person, or indeed, a government.

    What we are observing is the decline of a large nation and, soon, the rebirth of a small one. As events unfold, the comparisons between the two will be fascinating to observe.

  • Introducing The USS Zumwalt – The US Navy's New $4.4 Billion Ship

    Dear readers, the U.S Navy would like to introduce to you its most technologically sophisticated destroyer to date: The USS Zumwalt.

     

    The USS Zumwalt (designed by Raytheon) is powered by electricity produced by turbines, has guns that can hit targets over 70 miles away, and has a sharp-angled geometric design that apparently makes the 610 foot long ship 50 times more difficult to detect on radar. It also has a state-of-the-art weapon launcher designed to fire missiles for sea, land, and air attacks. All of this for a taxpayer cost of a mere $4.4 billion.

    During the testing phase for the ship, a lobsterman told the Associated Press that the vessel appeared to be a 50 to 60 foot fishing boat on his radar.

    The ship is set to be formally commissioned in October in Baltimore, and will have a home port of San Diego.

     

    Here is a time-lapse video posted by the Navy showing the ship’s initial launch in 2013

    See, the defense budget needs to be as large as it is in order to build behemoth warships such as this. The good news is that it will only show up as small fishing boat when sent to the Fiery Cross Reef in order to agitate China.

    The only question is how long before this ship also suffers a terminal failure.

    Recall that in December one of the Navy’s newest ships had to be towed more than 40 miles to port after it broke down less than a month after it was commissioned into service. The littoral combat ship USS Milwaukee, which cost a far more modest $360 million, broke down just days after its was put into service.

    For $4.4 billion, the Zumwalt’s failure should be truly breathtaking.

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