Fly at your own risk

Story du jour:

Aircraft repair jobs performed by unqualified illegal alien workers, displacing qualified Americans; previous experience, speaking English not required

If you own a house, it’s probably gone down in a value.  There isn’t much of anything that you can do about that and if you are like many homedebtors, you probably prefer to crack open a Burgie(tm) and ignore that particular problem until it goes away (or the market turns around- heh).

Kind of the adult version of making like an ostrich: you just don’t want to know or think about it. La la la la fucking la.

Besides, if you still have a job, you can pay the mortgage- after all we all need a place to live.

And unless you attract disaster, chances are nothing will crash into your house. I’ll take those odds (knocks on wood).

If you are a frequent flyer, you might want to read this story (with video for the weary) out of a Dallas TV station. Or, after reading the headline you might just prefer to just ignore it.

After all, what can you do about it?

Perhaps it’s not as bad as it sounds.

The problems are probably blown all out of proportion by the media, and are most likely contained to an entirely different segment of the market than those you frequent.

It’s just one news story, and not even out of a major market. Why hasn’t the NY Times covered it? Must not be important.

We can still trust that regulatory authorities are doing their job, and haven’t taken any bribes or lined up a cushy office job after their retirement from the FAA or ICE with the companies they oversee, to occasionally look the other way.

Even with early retirement and a juicy double-dip escapade beckoning, a federal official would never neglect their sworn duty while in office and place American people at risk.

No sirree Benny.

[WFAA.com]

HT: Mish

…

–
Who regluates the regulators?

“… indentured servants who have fewer options than renters.”

Got to love them banks.

Wishful thinking

They get bailed out, and farm out the mortgage-mod grunt work to criminals, liars, and thieves (former <spit>  mortgage brokers). How’s that working out?

In March, about 10% were actually finalized.

1/10 of one percent of all  ‘mortage workouts’ actually see a reduction in principle.

Dr. Housing Bubble does an excellent job of bringing this part of the Grandest Boondoggle of Them All into sharper focus with each post. Folks, the Alt-A and option ARM tsunami is out in the middle of the Pacific and be assured, it is heading this way.

I’m not in favor of reducing principal per se, but when banks got such generous bailout terms that came right off the table (we’re in this mess together, like it or not). Shouldn’t the banks be encouraged to pass the savings on to the bailer-outers, i.e. underwater home-renters homedebtors?

That would work out similarly to the way the funding passed right through the golden goose of AIG- which shat out of their anus BILLIONS into the waiting mouths of Goldman Sucks.

BTW, a ‘workout’ completely favors the bank. If a workout is ever ’successful’ (YMMV), it guarantees a life of indentured servitude. Term extensions, a short-term extension of the teaser rate, and small principal deferral are the main methods being used to bind the homedebtor slave.

Workouts are simply buying time, kicking the can down the road… and eventually today’s workouts fall permanently into the default column too.

You’re really better off walking away.

…

–
Debtors are the slaves to the world.

Benron Bukkake hires a professional liar

WASHINGTON (Reuters) – The U.S. Federal Reserve, Inc. (a privately held, for-profit entity) is on track to hire a veteran lobbyist to help manage its relations with Congress at a time of heightened attention to its role in national affairs, a source familiar with the situation said on Friday.

The Fed plans to hire Linda Robertson, who previously worked for now-defunct energy company Enron, as well as the Clinton administration.

The U.S. central bank has been at the forefront of government actions to limit damage from the financial crisis it created, which began in August 2007.

Robertson was vice president for government affairs at now-defunct energy company Enron Corp from November 2000 until she closed its Washington office in early 2002. Enron collapsed in scandal in 2001 and her work there may raise some eyebrows.

Before that, she was an assistant Treasury secretary for legislative and public affairs under then-President Bill Clinton.

[Reuters]

I shit you not.

…

–
“Knowing about art does not make a painter.” Vernon Smith on Benron Bukkake

Decline of the middle class

What Isn’t Coming Back

In other words, everyone from marketers to the evangelical movement perceived rising ownership of material goods as an “obvious” metric for “the good life.” But the entire superficial surface of jewelry, lavish cruises, huge suburban homes, etc. was based not on a foundation of savings and productive real wealth but on astonishing increases in debt. It was never sustainable, and the fantasy that it was sustainable, and perhaps even “deserved,” was always visibly absurd.

The entire edifice of consumerism is a “false god” which has now been toppled from its gold-leafed perch. Buying more and owning more did not create a sustainable, healthy happiness or a sense of self-identity; the insecurity and anxiety which were masked by shopping and prescription drugs have now been laid bare.

[Charles Hugh Smith]

–
“At 8% Annual Compounded Growth it will take us 11 years to return to the peak of the S&P 500.” -Dr. Housing Bubble

Please Mr. Gummint man, don’t take away my bowl!

U.S. rescue efforts may risk double-dip recession

WASHINGTON (Reuters) – U.S. companies, consumers and communities may grow so addicted to government financial help that cutting them off could trigger another recession soon after the current one ends.

[Reuters]

–

Pending Home Sales Down 7%

The index is at the lowest level since tracking began in 2001.

[NAR]

–

Does Creeping Nationalization Make Reprivatization Harder?

A New York Times article tonight, “U.S. Likely to Keep the Reins on Fannie and Freddie”, raises the specter that the mortgage giants may never return to private form. Frankly, we think that is not entirely a bad thing. Fannie and Freddie were originally agencies of the US government and were (sort of) spun out in the late 1960s, when their borrowings on top of Vietnam war funding made the Federal balance sheet look ugly. And in typical plus ca change, plus c’est la meme chose fashion, the reason the GSEs have not been fully taken over is to avoid consolidating their debt onto the Federal balance sheet.

[naked capitalism]

–

I Shit You Not

Bernie Madoff is accused of fleecing his clients out of billions, but he said Monday he shouldn’t be forced into the poorhouse.

His lawyers are arguing that Madoff should be entitled to keep the $7 million apartment he’s currently being held in while under house arrest and $62 million.

Court papers filed on Monday state that Madoff and his lawyer say the Manhattan penthouse and the millions held in accounts of Madoff’s wife, Ruth, are not subject to seizure.

Madoff’s lawyers claim “only Ruth Madoff has a beneficial ownership” to a Manhattan apartment, about $45 million in municipal bonds on deposit at Cohmad Securities Corp., and approximately $17 million in cash in another account, Stanton said. Ruth Madoff says these assets are “unrelated” to the alleged fraud, Stanton wrote, citing her husband’s lawyer. “

[cbsnews] [BB]

–

Radioactive Toxic Waste: Works Just Like CDOs — For Real

Hot (radioactive) recycled metal from decommissioned nuclear power plants, among other places, is threatening to radioactively contaminate the entire world’s steel industry. The way he explained it to me, it’s just eerie how this unfolding story of risk and greed parallels the familiar dynamics of subprime [and its effect on CDO's].

[Housing Doom]

–
Any resemblance that 2009 has to 1929 is purely intentional.

Dirty assets

Sunday Mulling

Unintended Consequences 20th Century and Beyond
This Article by James Quinn, (Jan 5, 2009) approaches the De/in-flation debate by helpfully poiting out what will be the real Deciders for each and every one of us in the coming decade:

Twenty years of consumer debt accumulation must be unwound. This required deleveraging needs to eliminate $2 trillion of household debt. The result will be thousands of retail store closings, mall closings, restaurant closings, and auto dealership closings. The distinction between needs and wants will reveal itself like a sledgehammer….

IMHO savers are “needs” based, spendthrifts are “wants” based. Which side do you come down on?

A man outstanding in his field

–
Too old to rock and roll, too young to die?
…from a TF thread (home of the ursine) by commenter “Bear”  regarding Bill Gross and Warren Buffet’s investing acumen and whether it is present and accounted for:

they are stupid mostly and old…This is a fast game and they aren’t motivated by the same things they were when they were good investors, let alone mentally agile enough anymore….and yes they do have more info but its based on flawed data IMO….they’re surrounded by yes men and look for and deal in political favor for returns…they’ve gone from “investors” to “power brokers” …that is the typical permutation of success….”

I like to point out this very fact out whenever a discussion treads into pertinent territory. Since most people I know are middle-aged and up, this matter tends to get some of them very uncomfortable!

To this pair of fading Icahns we can surely add Ross, Thain, Cayne, Elmer “Dickie” Fuld, Pickens, Rubin, Pandit, Redstone, Hank-panky, Benron Bukkake,  Krekorian, Joseph Lewis, Madoff(?), Barmy Frank, Tangelo Orangezillo, Chris Doddery, Bush, Cheney, Obama, Summers, Meriwether, Krudblow, Cramer, Scholes, fill-in-the-blank. Should Jimmy Rogers be in that company? George Soros? Krugman?

The inclusion of Madoff is because my *theorem of pinnacle-envy-itis* states that

When power brokers are confronted by a once-in-a-lifetime crisis and clearly don’t know what to do, they’ll desperately cling to their cloak of invincibility and do absolutely anything and everything possible to keep-up appearances.

Now how boojy (bourgeois) is dat?

–

Extra credit section

Deflation has become inevitable

For a while now I have been on the fence on the inflation/deflation issue – whether the massive monetisation of bad debts by central banks and governments will lead to rapidly escalating inflation as currencies are debased or, alternatively, lead to deflation as bad debts and illiquidity undermine all commercial and financial activity in the economy. I’m now coming down on the side of deflation for a very simple reason: there is no longer any incentive to save or invest, and so debt and investment cannot increase much beyond current bloated levels.  [London Banker]

Wave ‘B’… What a Wonderful World!

The ‘C’ I am referring to in the Voyage to the Bottom of the ‘C’, represents in Elliott Wave terms the third and final leg of an A-B-C correction which is correcting an up cycle which began before America was even born. That puts this correction on a higher order than the Great Depression, a “Grand Supercycle Degree” corrective wave.  [Economic edge]

–
All of a nation’s laws are enforced selectively.

Obama backpedals on promise (first in a series)

We just got through eight years of absolutely the worst president the people of this country should ever have to suffer… Yet we survived… So far… then we wipe a brow and and let out an audible WHEW! only to realize, no, NOT AGAIN, how much longer must we suffer the slings and arrows of outrageous fortune?

Is Barry Hussein nothing more than a serving of Bush II’s  sloppy seconds?

Yeah difficult to fathom, I know. But at the end of the day…. it’s night, and a politician is a politician… especially one from <ahem> Chicago.

I bet the true believers(tm) never saw that one coming, eh?

Scrooged by the Democrats: Will the Rich Ever Pay Their Fair Share? [Mother Jones]

…

–
Historically, public employees accepted lower salaries in exchange for attractive retirement pensions and cushy jobs handed to them by relatives and/or political friends. Now their salaries have become competitive with private sector employees, most of whom have been stripped of their pensions. [wallstreetexaminer]

Stop the insanity!

The American education system is full of shit:

Shit for brains: The Best and the Brightest Led America Off a Cliff

The multiple failures that beset the country, from our mismanaged economy to our shredded constitutional rights to our lack of universal health care to our imperial debacles in the Middle East, can be laid at the feet of our elite universities. Harvard, Yale, Princeton and Stanford, along with most other elite schools, do a poor job educating students to think. They focus instead, through the filter of standardized tests, enrichment activities, advanced placement classes, high-priced tutors, swanky private schools and blind deference to all authority, on creating hordes of competent systems managers. The collapse of the country runs in a direct line from the manicured quadrangles and halls in places like Cambridge, Princeton and New Haven to the financial and political centers of power.

…

Barack Obama is a product of this elitist system. So are his degree-laden Cabinet members. They come out of Harvard, Yale, Wellesley and Princeton. Their friends and classmates made huge fortunes on Wall Street and in powerful law firms. They go to the same class reunions. They belong to the same clubs. They speak the same easy language of privilege and comfort and entitlement. They are endowed with an unbridled self-confidence and blind belief in a decaying political and financial system that has nurtured and empowered them.

These elites, and the corporate system they serve, have ruined the country. These elite cannot solve our problems. They have been trained to find “solutions,” such as the trillion-dollar bailout of banks and financial firms, that sustain the system. They will feed the beast until it dies. Don’t expect them to save us. They don’t know how. And when it all collapses, when our rotten financial system with its trillions in worthless assets implodes and our imperial wars end in humiliation and defeat, they will be exposed as being as helpless, and as stupid, as the rest of us.

[TruthDig]

…

–
“Why is our government penalizing the people who played by the rules and rewarding the people who didn’t?”

Why can’t our state have a governor this good?

Instead we have to suffer through Arnoldt, who believes the true spirit of compromise is to cave.

Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers.

-Eliot Spitzer [WPost]

Looks like once again the operatives in the Bush adminsitration found a way to take laws meant to protect US and us them against US, for their own financial gain.

War is a racket? Hell, government is a racket.

–

And what the hell is going on here? Another Barry Ritholtz discovery.

–

It’s all fun and games until someone loses an economy.