THE ECONOMY & YOU # (Daily Updated Videos & Articles)

Zoning vs. Eminent Domain: How Ventura County Shut Down The Pine Mountain Inn



In the northernmost reaches of California's Ventura County, a two-lane rural road called Highway 33 runs into the rugged and mostly undeveloped Transverse Mountain Range. Though it's mostly raw wilderness, a few businesses catering to adventurous explorers have long existed there, some for more than a century.

But now the local government is shutting those businesses down, one by one, using arcane zoning and building-code laws to get the job done.

"If there isn't someone complaining, and there isn't really a serious public health and safety issue, why do they spend so much of their time pursuing these kinds of cases?" asks Lynne Jensen, executive director of the Ventura County Coalition of Labor and Business (COLAB).

Tom Wolf owns the Pine Mountain Inn, a restaurant that's been serving biker groups and local community organizations since the 1930s. Wolf temporarily had to shut the doors when he suffered a heart attack in 2002, and he was never able to reopen when the county informed him that his property had been rezoned as an "Open Space" back in the 1980s without his knowledge.

"[The county] wanted everybody out of here," says Wolf. "And they wanted a complete open space with nothing but deer and frogs... and no people."

No matter how hard Wolf tried to comply with the ever-changing codes, the county just wouldn't relent, at one time even ordering him to remove a chicken coop that had never actually existed on the property.

Wolf isn't alone, says Jensen. Several other small businesses along Highway 33 have been hit by multiple county agencies for no apparent reason.

"They had every department hit us with violations to make sure that they shut us down," says April Hope, who, along with her husband Bob, owns a bed and breakfast called The Wheel, which has existed in the area since the 1890s.

Since the Hopes purchased The Wheel in early 2000, they've never been able to open it to the public. While officials from the county supervisor's office and the planning department refused to speak with ReasonTV for this story, Jensen says that the county is using code enforcement to drive these businesses off the land without compensation.

"This rezoning is really a way to get around eminent domain, because eminent domain means you give up your entire property. And here, you only give up part of your rights," says Jensen.

Invoking eminent domain to seize private property would not only require the county to compensate landowners, but also to demonstrate that the taking served a "public use."

"They have been very successful in taking people's property in a number of different ways without compensation as long as they don't take ownership of it," says Jensen.

Towards a Global Economic Slowdown: Stock Market Slide, Declining GDP, Rising Unemployment
by Mike Whitney
June 5, 2012

“Every major part of the global economy is slowing, and slowing rapidly….Right now, we seem to be in a synchronized global slowdown, and that is very worrisome.”
– Mohamed El-Erian, Pimco

Growing troubles in the eurozone, a slowdown in China and a jobs report that was weaker than the most-pessimistic forecast, sent stocks plunging on Friday. The Dow Jones Industrial Average lost 275 points on the day while the S&P 500 and the NASDAQ followed the DJIA into the red. All the gains of 2012 have now been erased leaving all the major indices in negative territory.

The global selloff was preceded on Thursday by a revision of first quarter GDP which was slashed from 2.2 percent to 1.9 percent. The US economy is neither growing nor adding jobs. The signs of stagnation – which have spread from manufacturing, to consumer confidence, to GDP, and now to jobs – has ended all talk of a “recovery” and dampened Obama’s prospects for re-election in November.

Payrolls increased by just 69,000 in May, far below the 150,000 that analysts had expected. The unemployment rate rose to 8.2 percent from 8.1 percent while revised estimates show that fewer jobs were created in the last 3 months than originally stated. The grim report suggests that the Obama economic recovery has run out of steam just as many economists had predicted. Obama’s unwillingness to follow the advice of top economics advisor, Christina Romer – who recommended a $1.8 trillion stimulus package, instead of the $787 billion that the administration settled on – has probably cost him the election. Obama’s future depends on the condition of the economy, and the economy stinks.

In Europe, troubles in Spain and Greece have touched-off a bank run that’s pushed yields on risk-free assets, like US Treasuries and German bund, to record lows. The German 2-year bund (Schatz) dipped into negative territory on Friday while yields on the benchmark 10-year Treasury declined to 1.44 percent. The yield on the Swiss 10-year has plunged to an astonishing 0.48% is “the lowest ever recorded anywhere.”

CONTINUE: [link to globalresearch.ca]

Last Edited by RoXY on 06/05/2012 11:10 AM

Keiser Report: Paper Money Collapse (June 5, 2012)
In this episode, Max Keiser and co-host, Stacy Herbert, discuss all hell breaking loose as an electronics chain store stockpiles security shutters, capital flees Greece (and Spain) and Max proposes a love market. In the second half of the show Max talks to Detlev Schlichter, author of Paper Money Collapse, about the euro, the drachma, the dollar and gold.

21 Signs That This Could Be A Long, Hot, Crazy Summer For The Global Financial System
Michael Snyder, Contributor
Tuesday, June 5, 2012
Activist Post

The summer of 2012 is shaping up to be very similar to the summer of 2008. Things look incredibly bleak for the global economy right now. Economic activity and lending are slowing down all over the planet, and fear is starting to paralyze the entire global financial system.

Things did not look this bad back in the summer of 2011 and things certainly did not look this bad back in the summer of 2010.

It is almost as if a "perfect storm" is brewing. Today, the global financial system is a finely balanced pyramid of risk, debt and leverage. Such a system requires a high degree of confidence and stability. But when confidence disappears and fear and panic take over, the house of cards can literally start collapsing at any time.

Right now we are watching a slow-motion train wreck unfold and nobody seems to know how to stop it. Unless some kind of a miracle happens, things are going to look much different when we reach the start of 2013 than they do today.

The following are 21 signs that this could be a long, hot, crazy summer for the global financial system....

CONTINUE: [link to www.activistpost.com]

Greece and the Euro: Fifty Ways to Leave Your Lover - Alternatives to an "Ugly Divorce"
by Ellen Brown
June 6, 2012

The problem is all inside your head she said to me
The answer is easy if you take it logically
I’d like to help you in your struggle to be free
There must be fifty ways to leave your lover.
– Lyrics by Paul Simon

The Euro appears to be a marriage of incompatible partners. A June 1st article in the UK Telegraph titled “Why Europe’s Love Affair with the European Project Is Ending” reported that two-thirds of 9,000 respondents thought that having the euro as their single currency was a mistake.

For Greece, it was a tragic mismatch from the beginning; and like many a breakup, it is really about money. Greece is a vivacious young woman chained to a tyrannical old man. She yearns to be free to dance on her own; but breaking up is hard to do. Defaulting on her debts will force her out of the Eurozone and back to issuing drachmas, and she could get brutally beaten by speculators on foreign exchange markets for her insolence.

Fortunately, there are alternatives to an ugly divorce. The treaties binding the 17 member nations are just a set of rules, entered into by mutual agreement; and rules can be bent or broken, especially in crises. The ECB (European Central Bank) broke a litany of rules to save the banks, and so did the Federal Reserve to save Wall Street in 2008. Rules that can be bent for banks can be bent for people and nations — not just Greece, but all the other Eurozone countries threatening to file for divorce.

Paul Simon says there are 50 ways, but here are five creative alternatives.

CONTINUE: [link to globalresearch.ca]

Last Edited by RoXY on 06/06/2012 04:53 PM

DEEPENING EUROPEAN BANKING CRISIS: G7 holds emergency meeting
by Peter Schwarz
June 6, 2012

Finance ministers of the Group of Seven (G7) industrialized countries held emergency talks yesterday, amid signs of a renewed economic slump worldwide and an intensifying crisis in Europe — notably the Spanish banking crisis and fears of a Greek exit from the euro.

European bank stocks closed mostly higher on news that all the G7 powers had agreed to the meeting. Japanese Finance Minister Jun Azumi reported that the G7 countries had stated they would cooperate in dealing with the Spanish banking crisis. They reportedly did not discuss the possibility of a Greek exit from the euro.

The financial press reported that investors would closely follow statements today by the European Central Bank (ECB). The ECB’s decision to reject a bailout request from Spanish bank Bankia played a major role in late May in provoking the current panic, amid the collapse of the Spanish real estate market.

The meeting came amid increasing discussions in European capitals of plans to respond to the escalating European debt crisis by pooling resources.

Experts estimate that Spanish banks need a total of 100 billion euros to cover their losses. Bankia, taken over by the state at the beginning of May, urgently needs 23 billion euros alone. Because of this, the Spanish government is no longer able to raise international bonds. The financial markets were virtually closed for his country, Finance Minister Cristobal Montoro had to admit on Tuesday.

If Spain, like Ireland, Portugal and Greece, applies for support from the European bailout fund, the fund’s resources would be quickly exhausted. As the fourth largest economy in the euro zone, Spain provides guarantees for some 12 percent of the fund, which would shrink accordingly. The spread of the crisis to Italy, the third largest economy in the euro zone, would also become more likely.

While the Spanish banking crisis is currently considered the biggest threat to the euro, governments and financial markets continue to look nervously to the Greek elections of June17. The Coalition of the Radical Left (SYRIZA) has announced that in the event of an electoral victory it would unilaterally cancel the austerity measures agreed with the troika — the European Union, European Central Bank and International Monetary Fund.

Although SYRIZA leader Alexis Tsipras insists that his party wants to remain in the euro zone, work with the Troika and repay Greece's debts in the long term, there is little evidence so far that the troika is ready to engage in a renegotiation of the financial packages for Greece. This would create a precedent that would make it difficult to dictate austerity measures to other countries. If they cut off credit to Greece, a default and exit from the euro zone would be almost inevitable.

The rating agency Standard & Poor's now estimates the probability that Greece will leave the euro zone at one in three. All euro zone governments, as well as Beijing, are preparing contingency plans for such an eventuality.

CONTINUE: [link to globalresearch.ca]

Last Edited by RoXY on 06/06/2012 05:01 PM

COLLAPSE OF THE EURO?
by Adrian Salbuchi
June 6, 2012

The Euro is creaking and making funny noises. Lloyds of London – who have a pretty good ear to perceive impending disasters – says the insurance market is preparing for the Euro's collapse and is trying to reduce its exposure as much as possible.

Robert Ward chief executive of the multi-billion dollar and almost five hundred year old institution said Lloyd's may have to write-down on its £58.9 billion investment portfolio if the euro collapses. In the interview for The Sunday Telegraph he explained the market has put in place a contingency plan to switch euro underwriting to multi-currency claims settlements

It seems Lloyds believes ‘grexit’ is looking more and more likely day by day. Insurers are a good reference point on this, since risk management lies at the very heart of insurance and reinsurance. London as well as Germany are two of the key global long-term risk management markets, counting on extensive expertise and experience in such potentially catastrophic financial upheavals.

Another major insurer providing credit insurance for Eurozone trade – the Franco-German Euler Hermes Group – has also stated is would be reducing coverage for trade with Greece. Clearly, a tell-tale sign that a country is about to go bust is when credit insurance providers decide to stop trading with it.

Also going into Orange Alert Mode are the German mega-bankers. Last weekend Juergen Fitschen, co-chief executive of Deutsche Bank, described Greece as a "failed state" run by corrupt politicians adding that even though he did not think that if Greece exits the euro that would immediately lead to the collapse of the eurozone, he was nevertheless jittery about the whole matter adding that “what we need to do is prepare for that eventuality."

CONTINUE: [link to globalresearch.ca]

Icelanders Force Accountability for Banks – Why Can’t We?
George Lakey, Contributor
June 7, 2012
Waking Times

Ever since Iceland’s economy collapsed in 2008, the country has been busy reinventing itself. The first step was to restore democracy through a turbulent nonviolent struggle, then to force resignations in the financial sector and secure a criminal conviction of their prime minister for dereliction of duty. Now they are exploring getting a new currency: the Canadian dollar.

If Icelanders think their traditional money has lost its legitimacy, why not adopt the euro or the U.S. dollar? Too much influence from the big banks of Europe and the U.S., they believe. Better to risk interference from the smaller and much better-regulated banks of Canada. (Canada, like the publicly-owned state bank of North Dakota, did far better in the 2008 crisis than most of the U.S. and Europe.)

For decades, Iceland was part of the “Nordic model” of social democracy, with the high standards of living, free university education, universal health care, full employment and other benefits. Like Norway and Sweden, in the late 1980s the Icelanders flirted with neoliberalism, but unlike their Viking cousins they went all the way. The right-wing party privatized banks, cut regulations and lowered the corporate tax rate. The banks, in turn, created a bubble through hysterical foreign borrowing, and the bubble broke in September 2008. Banks failed. Unemployment and inflation shot up, and crisis reigned.

CONTINUE: [link to www.wakingtimes.com]

Walter Burien: CA Comprehensive Annual Financial Reports Show $8 Trillion Tax Surplus
Carl Herman, Contributor
Wednesday, June 6, 2012
Activist Post

Walter Burien is the pioneer for communicating that government-claimed budget deficits are criminal lies of omission when compared with colossal tax surpluses revealed in their Comprehensive Annual Financial Reports (CAFR).

For example, California Governor Brown claims the state budget deficit of $16 billion requires austerity, when the state CAFR reveals $600 billion in cash and investments.

The crime of economic fraud is a state governor with fiduciary responsibility failing to clearly communicate this tax surplus over 35 times the claimed deficit, and to submit this data for independent economic cost-benefit analyses for public consideration of all our options.

When all California local governments’ CAFR surplus accounts are totaled, Californians have been overtaxed by $8 trillion dollars in a sampled study of the more than 14,000 government entities.

CONTINUE: [link to www.activistpost.com]

Bloom Exposes FTT Scam & Central Banking Crooks - European Parliament, Strasbourg, 23 May 2012
Speaker: Godfrey Bloom MEP, UKIP (Yorkshire & Lincolnshire), Europe of Freedom and Democracy (EFD) group

The U.S. Economy By The Numbers: 70 Amazing Facts That Barack Obama Does Not Want You To See
Michael Snyder, Contributor
Friday, June 8, 2012
Activist Post

Why is the economy going to collapse? Have you ever been asked that question? If so, what did you say?

Sometimes it is difficult to communicate dozens of complicated economic and financial concepts in a package that the average person on the street can easily digest. It can be very frustrating to know that something is true but not be able to explain it clearly to someone else.

Hopefully many of you out there will find the list below useful. It is a list of 70 numbers that show why we are headed for a national economic nightmare.

So why does the title of the article single out Barack Obama? Well, it is because right now he is the biggest cheerleader for the economy. He is attempting to convince all of us that everything is just fine and that the economy is heading in a positive direction. Well, the truth is that everything is not fine and things are about to get a whole lot worse. Certainly others should share in the blame as well. Congress has been steering the economy in the wrong direction for decades, the "too big to fail" banks have turned Wall Street into a pyramid of risk, leverage and debt, and the Federal Reserve has more power over the financial system than anyone else does.

Our economy has been in decline for quite a while now, and soon we are going to smash directly into an economic brick wall. Unfortunately, a lot of Americans are in denial about this. A lot of people out there doubt that an economic collapse is coming. Well, if you know someone who believes that the U.S. economy is going to be "just fine", just show them the list below.

The following are 70 facts that Barack Obama does not want you to see...

CONTINUE: [link to www.activistpost.com]

^ the truth hurts!

The 5 Most Surprisingly Corrupt Industries in the World (and what you can do about it)
Noah Bonn, Contributor
Saturday, June 9, 2012
Activist Post

In my last article, I identified what I see as the 5 most blatantly corrupt industries on the planet, and offered solutions to the disharmony they create.

In the words of Johann Wolfgang van Goethe, however, “there are none more hopelessly enslaved than those who falsely believe they are free.“

In most circles it has become well accepted that Banking and Energy are profoundly corrupt industries, but they are seen by many as isolated infections in an otherwise forthright world economy.

The purpose of this article is to address that assumption - to outline 5 of the most glorified, revered industries in the world, and display how they frequently are, in fact, just as corrupt as the Monsantos and Exxon Mobils of the world.

1. Values Investing - Most people assume that the credit crisis we’ve been facing for the last 4 years is entirely the result of foul play by the big banks and Wall Street. While they are, of course, the ones who triggered the ‘recession,’ they were far from the only ones who enabled it. Let’s consider a couple data points:

- The US money supply (M2) is currently valued at just over 9.8 trillion USD [1].
- The US Total Debt (Individuals+Firms+Banks+Government) is currently estimated at 57.6 Trillion USD [2].

Take a moment to process that ratio; there is 5.9 times as much debt as there is money in the US economy. No amount of clever budget rearrangement, therefore, can compensate for the fact that there is not enough money to pay off all that debt.

CONTINUE: [link to www.activistpost.com]

THE SPAILOUT: Stock Markets Tumble. Failure of the Spanish Bailout
by Washington's Blog
June 12, 2012

The market rallied for a couple of hours on news of the $100 billion dollar Spanish bailout (which everyone is calling the Spailout) … and then crashed.

Bloomberg notes: U.S. stocks fell, following the biggest weekly rally in the Standard & Poor’s 500 Index this year, as optimism over Spain’s bailout plan gave way to skepticism it will succeed in halting the debt crisis.

“The Spanish deal is another Band-Aid,” said Matt McCormick, who helps oversee $6.2 billion at Bahl & Gaynor Inc. in Cincinnati. He spoke in a telephone interview. “Many investors are viewing this with skepticism. The problem is not going to be fixed by this amount. It’s not a solution, and people know the difference. Expect more volatility not less.”

CNBC writes: Stocks accelerated their selloff in the final minutes of trading to close down more than 1 percent across the board Monday, as initial euphoria over Spain’s bank bailout fizzled and amid ongoing fears over a global economic slowdown.

“A lot of people were concerned over the size of the bailout—we were expecting something closer to 150-200 billion [euros] and we only got 100 billion,” said Phillip Streible, senior commodities broker at RJO Futures. “So once traders started to digest [the news], they started to take profit or sell into that rally because they think that in another 3 to 6 months, Spain’s going to have to come back and ask for additional money.”

CONTINUE: [link to globalresearch.ca]

Fed report shows: Crisis has thrown back US families 20 years
by Patrick Martin
June 13, 2012

The financial crisis of the past four years has thrown American families back two decades, according to figures provided by the Federal Reserve Board in its triennial Survey of Consumer Finances.

The median net worth of US families — the combined value of homes, bank accounts and other assets, minus mortgages and other debts — fell 38.9 percent between 2007 and 2010, from $126,400 to $77,300, approximately the level recorded in 1992. Median income also fell over the three-year period, down 7.7 percent before taxes, adjusting for inflation.

CONTINUE: [link to globalresearch.ca]

Spain: The Latest Shoe to Drop
Stephen Lendman, Contributor
Wednesday, June 13, 2012
Activist Post

This one won't be the last. The late Bob Chapman warned years ago about what's unfolding now in real time. He explained what this writer calls bad policies assure bad results. It happens every time.

They've simmered for decades. They continue now. They're worse than ever. Gresham's Law explained that bad money drives out good. So does bad behavior.

Money power in private hands assures it. Throughout its history, the Fed bears direct responsibility for monetary debasement and decline of American living standards. A 1913 dollar isn't worth a plug nickel today. Ahead perhaps it'll be worthless.

Chapman predicted it. He was spot on about what he told readers. He was way ahead of what others revealed. Before anyone saw trouble coming, he warned about easy money, market manipulation, reckless speculation, counterproductive fixes, and unsustainable debt causing today's crisis.

He predicted an eventual house of cards collapse. Only its timing remained uncertain. He said it could happen anytime from 2012 to 2017. He's not around to see it. It won't be pleasant when it comes.

CONTINUE: [link to www.activistpost.com]

Spain's Banking Crisis: The Destructive Impacts of the Financial Meltdown
by Dr. Eric Toussaint
June 15, 2012
cadtm.org

All eyes are turned toward Spain and its banking sector. After Greece, Ireland, and Portugal, we may ask ourselves if the bailout plans are behind us or whether we are simply in the eye of the cyclone? We must remain lucid and recognize that the financial and banking crisis is far from over, both in Europe and the United States. It will have long-lasting repercussions on the rest of the world economy, and on living conditions everywhere. Yet, in Europe, in the first quarter of 2012, the major media outlets backed the declarations made by European leaders, and representatives of the ECB and private banks to convince public opinion that the policies implemented had enabled the banking system to be stabilized.

According to the prevailing rhetoric, the mounting fear stems from the over-indebtedness of countries, a possible default by Greece, and the adverse effects it would have on Spain and Italy. As far as the banks are concerned, the rehabilitation is supposed to be going forward, and the ECB has everything under control. From January to the early May 2012, the following general message was repeated ad infinitum: “Thanks to the 1000 billion euro loan banks have been given by the ECB in two phases (December 2011 and February 2012) for 3 years at 1% interest, private financial institutions are now in a good position to handle the difficulties facing countries in terms of sovereign debt. The financial markets have been stabilized, and the stock markets have risen after a particularly bad year. Public finances are being cleaned up thanks to the golden rule, which is being adopted everywhere, the efforts made by countries to reduce expenditures, and the reform of the labor market to make it even more flexible and of retirement regimes to cut costs. Some additional efforts must be made, but the end of the tunnel is in sight. Sweet dreams, dear friends!”

In May 2012, this rosy message was strongly refuted. It had become clear that private banks have not fundamentally cleaned up their accounts, have not modified their high-risk behavior, and their Directors have not lost their thirst for hefty bonuses and golden parachutes. Bankers consider that public authorities will always be there to save their skin. Bank bailouts with public funds continue. The depression is deepening, and public debt is increasing due to the combined effect of the bailouts and the depression. Meanwhile, the financial markets are blackmailing the weakest members in the euro zone more than ever before.

CONTINUE: [link to globalresearch.ca]

Charting the Cozy Connections between JP Morgan and the Senate Banking Committee
by Cora Currier
June 14, 2012
ProPublica

This morning, Jamie Dimon, the CEO of JP Morgan Chase, faced a Senate hearing [1] over more than $2 billion in bank losses [2] caused by risky hedges that blew up. Dimon said [3] that the hedges — investments meant to protect the bank — had grown into “complex and hard-to manage risks.” The losses “let a lot of people down, and we are sorry for it.”

Many lawmakers are holding up the losses as evidence of the need for stronger financial regulation [4]. The chairman of the Senate banking committee, Tim Johnson, D-S.D., in his opening remarks, asked for “a full accounting” of JP Morgan’s losses.

But through campaign contributions and well-connected staff, JP Morgan appears to have already taken its own accounting of the Banking committee. Here’s a picture of connections between the company and the committee:

CONTINUE: [link to globalresearch.ca]

Forex Trader to Halt Services Due to "Uncertainty in Europe"
Saturday, June 16, 2012
Activist Post

In what may foreshadow an extremely volatile week for the euro, the large Forex trading company OANDA announced that it will halt currency trading this Sunday. In a statement from the company, they said their decision is "very much tied to the uncertainty in Europe."

They claim "there is the potential for extreme exchange rate volatility at a time when global currency markets are closed" should the Greek elections signal a rejection of the ECB's bank bailout and austerity package.

Here is the entire statement from OANDA:

CONTINUE: [link to www.activistpost.com]

JPMorgan Chase on Capitol Hill
by Stephen Lendman
June 15, 2012

On June 13, JPMorgan Chase CEO Jamie Dimon testified before the Senate Banking Committee. He discussed his firm's recent trading loss and industry practices.

It was more of a homecoming than grilling. Washington is Wall Street occupied territory. Foxes guard the hen house. Regulators don't regulate. Oversight is absent.

Investigations rarely happen. Those conducted are whitewashed. Criminal fraud is institutionalized. It's encouraged, not curbed.

Congress, the administration, SEC, and credit rating agencies are incestuously involved with giant banks and other major financial institutions. Whatever they want, they get.

Wall Street never had it so good. Senators didn't lay a glove on Dimon. His grand theft business model wasn't explained.

Former bank regulator/financial fraud expert Bill Black's book titled "The Best Way to Rob A Bank Is To Own One" told all.

He coined the term "control fraud." It lets corporate officials commit grand theft. Finance capital never had it so good. Trillions of dollars are stolen. Nothing intervenes to stop it.

On May 10, Dimon announced a $2 billion trading loss. Some estimates place it multiples higher. Trading is a euphemism for speculation. Stakes are high enough to cause crises.

Morgan is the tip of the iceberg. Other banks are deeply troubled. They'll come out in future announcements. Cursory explanations only will be provided. What Morgan bet and lost on wasn't explained.

European securities speculation looks likely. Its big trader is called the London Whale. Wstern media reports said little.

Troubled Eurozone economies face deepening depressions. Bank problems accompany them. Investing in their sovereign and/or private debt entails great risks.

Dimon attributed the loss to credit default swaps derivatives trading. They're the most widely traded derivative. They're unregulated insurance bets between two parties on whether or not a company's bonds may default.

CONTINUE: [link to globalresearch.ca]

Stimulus versus Austerity: The Crisis of Europe's Economic and Financial System
by Stephen Lendman
June 17, 2012

Four and a half years after crisis conditions erupted, nothing's been done to resolve them. The smartest guys around haven't fixed things.

On June 14, rumors circulated about coordinated central bank intervention. European banks are especially troubled. Recapitalizing them hasn't worked.

Expecting more of the same to accomplish what hasn't so far worked is another way of defining failure.

Along with talk of more stimulus, Egan-Jones Ratings, an independent NRSRO (Nationally Recognized Statistical Rating Organization), downgraded French sovereign debt from A- to BBB+ with a negative outlook. Doing so shows core European weakness.

Dutch banks were also downgraded. So were Spanish ones and sovereign Spanish and Cyprus debt. Both countries approach junk status.

Germany shows weakness. Its 10-year sovereign debt jumped over 30 basis points from recent lows. It's troubled by having to fund more bailouts or face euro dissolution issues. It's also pressured by having to shore up the ECB in case it's threatened.

The average Eurozone country has a 500% debt/GDP ratio. Expects more defaults, write-downs, and frantic steps to shore up sovereign debt.

Spanish bonds touched 7% before settling slightly lower. Liquidity isn't the problem. Markets are awash with it. At issue is sovereign and banking sector solvency.

Multiple intervention rounds solved nothing. Neither will more of the same. Structural problems remain unresolved. More time alone is bought. It doesn't come cheap. The price is greater debt, higher service costs, and eventual crisis conditions too grave to fix.

CONTINUE: [link to globalresearch.ca]

World Bank chief calls Spanish bailout ‘wasted’
By Agence France-Presse
Sunday, June 17, 2012

The head of the World Bank said Sunday that Europe’s bail-out of the Spanish banking system had been handled very badly and amounted to a wasted opportunity to contain the debt crisis.

Addressing business leaders on the eve of the G20 summit in Mexico, Robert Zoellick and other senior international economists said that Europe needed to improve its institutional response in order to reassure bond markets.

“Look everyone knows this meeting is coming at an absolutely critical time — and we’re waiting for Europe to tell us what it is going to do,” he said at a panel in the B20 business summit, held in parallel to the G20 meet.

CONTINUE: [link to www.rawstory.com]

What We Can Learn From Iceland
For all the fearmongering we hear out of our politicians on the right about how heaven forbid we're going to turn into Greece, the one country you never hear them talk about any more is Iceland. The reason they don't is, as Cenk Uygur explained on his show this Tuesday, they took a different path than the United States after their financial crisis and nationalized the banks, threw some the people responsible for the crash in jail and bailed out the homeowners instead of worrying about only bailing out the banks. And now they're coming back and their economy is growing again...

The Biggest Myth Preventing an Economic Recovery: "Private Debt Doesn't Matter"
by Washington's Blog
June 18, 2012
Washington's Blog

The Widespread Economic Myths Destroying the Economy
There are many widespread myths preventing an economic recovery, including the following myths:

- Military spending stimulates the economy

- The banks are acting more conservatively now than before the financial crisis

- We’ve got to prop up the big banks

- We’ve got to protect the bondholders against suffering big losses

- The government has prosecuted the financial fraud which it has discovered, but it’s hard to make out a case against most of Wall Street’s acts

- The economy always returns to equilibrium and stability by itself

Obama’s belief that unemployment is good for the economy, and Greenspan’s belief that too little debt is bad for the country are also ridiculous.

But the most dangerous myth – because a lot of economic policy is based upon it, and because so few know that it is false – is the myth about how banks make loans.

The Myth that Private Debt Doesn’t Matter
Before we can address the myth about how banks make loans – and as a way to understand the deadly effect of that misconception, we need to talk about debt.

As economics professor Steve Keen documents in his must-read book, Debunking Economics: The Naked Emperor Dethroned, mainstream economists – from both the left and the right – don’t even take debt into consideration in their models of what makes for healthy economies.

CONTINUE: [link to globalresearch.ca]