Ageing Baby Boomers, the One Mega Trend NO ONE is Talking About

Reading - Ageing Baby Boomers, the One Mega Trend NO ONE is Talking About http://www.marketoracle.co....

Thus far, analysis the financial collapse has been framed almost entirely in terms of money. All the research I’ve seen has delved into lending standards, securitization, inflation, interest rates, housing and the like.

Yet underneath this veneer lies one larger, mega-trend that has driven all of these themes to a greater or lesser degree. It created one of the largest stock bull markets we’ve ever seen from 1982-2001. It helped drive the Bubbles in Tech stocks AND Housing. And now it will guide the coming collapse in stocks and consumer spending.

That trend is AGE: specifically the Boomer generation and its retirement.

For the sake of simplicity, I will define a “Boomer” as someone born in the post war boom years from 1946-64. Using this data, today’s Boomers are between 45 and 63 years old. All told there are 76 million Americans in this age category. As of late 2008, Boomers:

• Comprised 38% of the US population
• Controlled $13 trillion (50%+) in American Household investable assets
• Controlled 50% of all discretionary income
• Purchased 43% of all new cars
• Accounted for 79% of all leisure travel spending
• Ate out four to five times a week
• Outspent younger generations by 2 to 1

You can see Boomers’ imprints on every major investment trend of the last 30 years whether it’s the rise in consumer spending, the Tech Boom, the Housing Boom, etc. These folks ARE the investing crowd or tide as far as money goes.

Please understand, I am not BLAMING the Boomers for ANY of these developments. I am merely pointing out that these folks were the primary participants who drove ALL of these trends due to their ever-increasing economic clout. Between 1980 and 2007, Boomers were “the money” behind virtually every economic development in the US.

The Boomers first came of age in the ‘80s (they were 16-34 years old at the start of the decade). Boomers were the first generation to fully adopt credit cards: between 1980 and 1990, credit card spending increased more than five-fold while average household credit card balances quadrupled. They were also the first generation to see stocks as THE means of securing ones retirement: stock-based 401(k)s were introduced in 1983.

By the time the ‘90s rolled around, Boomers had completely entered the workforce (ages 26-44). Thanks to easy credit and cheap goods from China (formal trade with the US opened on 1971), the Boomers operated under the illusion they were getting richer almost every year, when in reality they were spending their and their parents’ savings.

Having seen stocks rise almost continuously from 1982-1990, Boomers were only too happy to take over own investment portfolios with the introduction of low cost online brokerage accounts. In 1950, 10% of US adults owned a stock. By the end of the ‘90s more than four in ten American adults were investing in the market. This massive influx of money helped, in part, to create the Tech Bubble.

Continue reading - http://www.marketoracle.co.uk/Article12028.html

NASA promises 'greatly improved' Moon landing footage - One giant leap in quality imminent

Reading - NASA promises 'greatly improved' Moon landing footage http://bit.ly/wYYsz

NASA promises 'greatly improved' Moon landing footage

One giant leap in quality imminent

NASA has tantalisingly announced that it will release "greatly improved video imagery from the July 1969 live broadcast of the Apollo 11 moonwalk" on Thursday.

The agency reports: "The release will feature 15 key moments from Neil Armstrong's and Buzz Aldrin's historic moonwalk using what is believed to be the best available broadcast-format copies of the lunar excursion, some of which had been locked away for nearly 40 years."

We assume the footage in question is gleaned from the original magnetic tapes recorded by the Parkes Observatory in Australia, and which belatedly turned up in a storage facility in Perth.

In 2006, NASA admitted it had mislaid the tapes which were supposed to be in its Goddard Space Flight Centre in Greenbelt, Maryland. As a result, the world has (until Thursday, we hope), had to make do with NASA's inadequate copy of the original broadcast, captured on 16mm film from a monitor screen.

Ron Paul - Fed Independence or Fed Secrecy?

Reading - Ron Paul - Fed Independence or Fed Secrecy? http://bit.ly/17hvEw

Last week I was very pleased that hearings were held on the independence of the Federal Reserve system. My bill HR 1207, known as the Federal Reserve Transparency Act, was discussed at length, as well as the general question of whether or not the Federal Reserve should continue to operate independently.

The public is demanding transparency in government like never before. A majority of the House has cosponsored HR 1207. Yet, Senator Jim DeMint’s heroic efforts to attach it to another piece of legislation elicited intense opposition by the Senate leadership.

The hearings on Capitol Hill provided us with a great deal of information about the types of arguments that will be levied against meaningful transparency and how the secretive central bankers will defend the status quo that is so beneficial to them.

Claims are made that auditing the Fed would compromise its independence. However, by independence, they really mean secrecy. The Fed clearly cherishes its vast power to create and spend trillions of dollars, diluting the value of every other dollar in circulation, making deals with other central banks, and bailing out cronies, all to the detriment of the taxpayer, and to the enrichment of themselves. I am happy to challenge this type of “independence”.

They claim the Fed is endowed with special intellectual abilities with which to control the market and that central bankers magically know what the market needs. We should just trust them. This is patently ridiculous. The market is a complex and intricate thing. No one knows what the market needs other than the market itself. It sends signals, such as prices, that should be reacted to and respected, not thwarted and controlled. Bankers are not all-knowing and cannot ignore the rules of supply and demand. They might act as if they are, but their manipulation of the market just ends up throwing it wildly off balance, which gives us the boom and bust cycles.

They claim the Fed must remain apolitical. No organization is apolitical that relies on the President to appoint the Chairman. In fact, it is subject to the worst sort of politics – power to create trillions of dollars and affect the value of every dollar in the country without the accountability of direct elections or meaningful oversight! The Fed typically enacts monetary policy that is favorable to particular administrations close to elections, to the detriment of long term considerations. They do this partly because of the political appointee process for the Chairmanship.

Continue reading - http://www.globalresearch.ca/index.php?context=va&aid=14356

China is concerned about the Dollar

Reading - China is concerned about the Dollar http://www.daralhayat.com/p...

China is insisting on the need to reform the global currency reserve system, sparing no occasion without reasserting and restating this demand, even in front of the U.S. officials themselves.

During the G8 summit last week (in Italy), China led one of the harshest and most direct attacks against the hegemony of the dollar on the global economy, while explicitly calling for the world to diversify its currency reserve system, and to seek to achieve the relative stability for currency exchange rates. It emphasized that "We should have a better system for reserve currency issuance and regulation so that we can maintain relative stability of major reserve currencies' exchange rates and promote a diversified and rational international reserve currency system."

China, like Russia, India and other countries, fears that the financing of the American deficit will have a negative impact on the stability of the U.S. dollar’s exchange rate. This is because the financing of large deficits entails an expansion of the process of “creating money”, and consequently, a decline in the value of the dollar itself.

In fact, the deficit in the U.S general budget is estimated to rise from 5 percent of the GDP in 2008 to 13 percent this year. This budget, which expires next September, requires certain returns and revenues to cover the expenses of the U.S administration that are estimated at 3250 billion dollars. But due to the reduction in tax revenues – stipulated by the economic stimulus plan – the American administration finds itself compelled to resort to public borrowing, where the public debt is expected to become a major burden on the U.S Treasury.

In the 1990s, this debt did not exceed 60 percent of the U.S. gross domestic product. It is however expected to rise this year to 80 percent of the GDP, and up to one hundred percent, and possibly 114 percent by 2014, provided that the economic activity will recover and restart next year.

Although keeping public debt in check vis-à-vis the GDP requires the enactment of various associated measures - the most important of which

is protecting financial institutions and all other funds - fixing interest rates on treasury bonds at low levels remains the most important condition for controlling this debt. This is because any gains brought by public debt (in a given country) are eroded when the debt’s interests exceed the rate of economic growth (in the same country).

Meanwhile, it is noted that the returns on U.S treasury bonds issuable over ten years have been strongly rising since the beginning of this year, reaching 4 percent in early June and currently beyond, but on the other hand, growth has shrunk by about 4 percent also this year. Perhaps it is the estimates that a recovery will occur in the second quarter of the year, as well as the forecasts of increasing inflation in addition to the large U.S treasury’s needs for financing, that are all behind this climb in treasury bonds revenues over the long term. Nonetheless, these financial needs are placing pressures on the prices of treasury bonds, thus raising their interest costs. The Federal Reserve Council however, led a counter-effort against the high returns on Treasury bonds, and announced last March that it will buy treasury bonds worth 300 billion dollars. This course of action "created money" in order to ease the pressure on the bonds market, but it has also rocked the lending countries. The reason is that “creating money” subjects the dollar to fluctuations and causes the deterioration of its value, which is exactly the situation the dollar finds itself facing right now.

Continue reading -http://www.daralhayat.com/portalarticlendah/37579

The Consequences of Big Government

Reading - The Consequences of Big Government - http://bit.ly/C6vXk

We face an unprecedented collision between Americans' desire for more government services and their almost equal unwillingness to be taxed. The conflict is obscured and deferred by today's depressed economy, which has given license to all manner of emergency programs, but its dimensions cannot be doubted. A new report from the Congressional Budget Office ("The Long-Term Budget Outlook") makes that crystal clear. The easiest way to measure the size of government is to compare the federal budget to the overall economy, or gross domestic product (GDP). The CBO's estimates are daunting.

For the past half-century, federal spending has averaged about 20 percent of GDP, federal taxes about 18 percent of GDP and the budget deficit 2 percent of GDP. The CBO's projection for 2020 -- which assumes the economy has returned to "full employment" -- puts spending at 26 percent of GDP, taxes at a bit less than 19 percent of GDP and a deficit above 7 percent of GDP. Future spending and deficit figures continue to grow.

What this means is that balancing the budget in 2020 would require a tax increase of almost 50 percent from the last half-century's average. Remember, that average was 18 percent of GDP. To get from there to 26 percent of GDP (spending in 2020) would require an additional 8 percentage points. In today's dollars, that would be about $1.1 trillion, a 44 percent annual tax increase. Even these figures may be optimistic, because CBO's projections for defense and "nondefense discretionary" spending may be unrealistically low. This last category covers much of what government does: environmental regulation, aid to education, highway construction, law enforcement, homeland security.

Continue reading - http://www.washingtonpost.com/wp-dyn/content/article/2009/07/12/AR2009071201533.html?wprss=rss_opinions

Online Pranksters Wreak Havoc at Hotels, Restaurants Nationwide

Reading - Online Pranksters Wreak Havoc at Hotels, Restaurants Nationwide http://bit.ly/46OXUk

Please, sir, do not throw your toilet out the window, no matter what the stranger on the phone is telling you.

If the phone in your hotel room rings unexpectedly at 2 in the morning, you might soon become the next victim of a network of scammers who are causing tens of thousands of dollars in damage at accommodations around the country.

Often imitated and deviously duplicated, a group called PrankNET appears to be at the center of a growing trend that has harried hoteliers and restaurateurs for months and is now being investigated by the FBI.

The head of PrankNET, who goes by the online name "dex" and has been behaving badly since 2000, leads an online chat system where he and fellow merry pranksters collaborate. Members of PrankNET chat online, stream their calls live on an Internet radio show and post their greatest hits to a YouTube page, a popular breeding ground for more pranks.

During their calls they often drop the name of a security corporation or say they are phoning from a hotel's front desk to lend themselves an air of credibility — and to get their victims to do surprising things.

In February, Dex's work made headlines when hecalled a KFC in Manchester, N.H., and convinced workers there to douse the restaurant with fire suppression chemicals, evacuate the building and strip outside in freezing temperatures. Dex accomplished all of this by pretending to be their boss from a corporate office.

Calls recently posted to PrankNET's YouTube channel have upped the ante even further, capturing scenes where confused hotel patrons have been duped into setting off fire alarms and sprinkler systems — flooding hotels and panicking sleeping guests.

A Florida family staying in an Orlando Hilton was tricked last week into smashing windows, breaking a mirror, bashing in a wall with a lamp and tossing their mattress outside, causing about $5,000 in damage, the Orlando Sentinel reported. The caller persuaded them to do all of that in order to save themselves from a gas leak.

continue reading - http://www.foxnews.com/story/0,2933,532241,00.html

Montreal Madoff - 'Please come back,' investors beg adviser

Reading - Montreal Madoff - 'Please come back,' investors beg adviser http://bit.ly/hO0ns

More than 150 people packed into an investors meeting in Montreal on Sunday to learn more from police and lawyers about what financial adviser Earl Jones has done with their money and how they might get it back.

The self-styled financial adviser is nowhere to be found and the accounts containing his clients' assets have been drained. Quebec authorities have frozen Jones's accounts and are trying to locate him.

Local and provincial police attended the meeting at a hotel in Pointe-Claire to gather statements from investors who suspect they’ve lost millions of dollars in a Ponzi scheme. The losses amount to life savings for some people.

Many of them said they had dealt with Jones for so many years, it never occurred to them to verify his credentials. Quebec's finance regulator, the Autorité des marchés financiers, confirmed Jones was never registered with them.

Kevin Curran, one of the organizers of the meeting, said his mother Karlene Kennedy invested with Jones but had not received a statement from him since the market crashed last October. He also said her mortgage payments have not been paid in two months.

Curran and his brother reached out over the internet last week and located other clients in similar situations. Curran said he planned on meeting with five or six people, and did not expect 150 to show up.

'There's no money'

"Probably some people [here] are saying that 'I'm just here as a friend,' but in fact it's them. I think there was a lot of that shame. That was tough to get through at the onset. They still didn't believe it, even though [their] kids were pushing since Monday, Tuesday [that] something's wrong," said Curran.

He and his brother passed all the information they collected last week to the AMF. Jones has not been charged with any crime and the allegations against him have not been proven, but the province's securities regulator froze his accounts and those of his company last week.

"We got the source documents and we know pretty much how deep it goes, at least enough to stop it. After that, you know, what difference does it make? There's no money, there's no money," Curran said.

Neil Stein, an insolvency lawyer representing one couple who invested, told the crowd his firm would try to bring Jones's corporation into bankruptcy, "to take possession of all the assets, to be able to distribute them to all the parties, as opposed to just the individual who's taking the proceeding."

Margaret Davis, an elderly investor at the meeting, said she doubts she'll ever see her money again.

"I can survive this month. After that, it's going to be a big question mark. Don't sleep very well these days," said Davis.

Quebec investors need 'new framework'

Michel Nadeau, executive director of the Institute for Governance of Private and Public Organizations in Montreal, said he believes losses by Jones's investors could turn out to exceed $100 million.

Nadeau said he thinks the Jones affair will lead to closer scrutiny of all private financial advisers.

“I believe unfortunately we will have to be more severe. To put a new framework. Meanwhile I think you should always deal with at least two financial institutions," said Nadeau.

Nadeau cautioned that investors can never be too careful when hiring a financial adviser.

America is now the world’s biggest debtor

Reading - America is now the world’s biggest debtor http://bit.ly/6aY8F

The latest Treasury auction of $19 billion of 10-year notes was at a yield of 3.365%. The bid to cover was 3.28 to 1, the highest ever. This was the third of four sales this week totaling $73 billion.

Consumer credit fell $3.23 billion in May, as credit fell 1.5% to $2.5196 trillion from $2.522 trillion in April. Four monthly declines matches June-December of 1991. Big loans fell $400 million, or 0.3%. Revolving credit fell $2.9 billion, or at a 3.7% rate.

We are now al most six months into the depression approaching a 1932 scenario. America is now the world’s biggest debtor. The US has had a fiat currency for 38 years and major trade deficits for more than 30 years. Is it any wonder we are in depression? Is it any wonder the dollar is under pressure even though our government supports it at every turn in the market?

The world is looking aghast at the dollar as the Treasury runs short of money to fund its deficit beyond revenues of $1 to $3 trillion and as the Fed monetizes trillions of dollars. What would you think if you had 64.5% of your foreign exchange in US dollars? That is almost $1.8 trillion. Some of these buyers have ceased buying and if that continues interest rates will head higher and the cost of carrying such debt will increase. As a result the dollar, of course, would move lower.

Higher yields on 10-year T-bills translate into higher mortgage rates as real estate inventory continues to grow, a terrible formula for the economy.

We estimate fiscal 2009 to have a deficit of more than $2 trillion and incoming revenues will only make up less than half of that. In spite of the protestations of our Treasury Secretary Tim Geithner that the deficit will be reduced, our president guarantees $1 trillion annual deficits as far as the eye can see. Cuts will never come and the dollar will fall because that is the way the elitists want it to be. Only from the ashes of economic and financial collapse can the new world order rise.

Our government says one thing and does another. They want to maintain confidence and trust, but at the same time proceed with the destruction of the monetary and financial system.

We are told that next month the monetization will end, when in fact the Fed will not have completed its $3 trillion monetization of Treasuries and Agencies and bank toxic garbage.

Europeans, the Japanese and the British all want their currencies lower in value versus the dollar, believing that a cheaper currency is somehow a magic elixir for trade and, of course, that isn’t always the case. In fact, the latest efforts to subdue the euro haven’t been very successful. The dollar has been incapable of breaking up and out of 81 on the USDX. At the same time, for now the euro has retreated from $1.42 to just above $1.38, but it won’t last. Simply, the US is in worse trouble than the eurozone.

Continue reading - http://www.globalresearch.ca/index.php?context=va&aid=14318

Print Ad Losses to the Internet: It Ain't Over Yet

Reading - Print Ad Losses to the Internet: It Ain't Over Yet http://seekingalpha.com/a/36c4

It wasn’t Craig’s fault. It was the internet’s. Almost $10 billion in annual newspaper classified revenue has disappeared (since its 2000 high, versus 2008) and it was essentially replaced by an estimated, unverified $100 million for craigslist with fewer than 30 employees.

But the bleeding ain’t over yet. The stone still has a few more corpuscles to squeeze out.

Look at the newly enhanced Google real-estate search. It’s awesome: useful, fast, informative, entertaining. Put in an address, browse all the homes for sale around. Who needs a newspaper? Who needs a real-estate agent? Speaking of whose death, see Michael Arrington reporting that disruptive, inexpensive real-estate service Redfin is turning profitable. Now see how classified aggregator Oodle is distributing classified ads on Twitter, which has also become the new distribution channel for news (challenging not just newspapers but also craigslist if you’re in the news biz and in the mood for a little schadenfreude).

Of course, this adds onto the the closing of thousands of advertising car dealers; the death of swaths of retail (e.g., Circuit City; and that is far from over, I think); the consolidation of more retail (and then the consolidator, Macy’s (M), cutting ad spending by half).

But that’s just advertising. I think that other arenas of newspapers’ competence could be targets for similarly disruptive attacks.

In content, I’m seeing that it’s possible for someone to come along with relatively little investment and a much smaller staff that operates more collaboratively to compete with the big, expensive traditional newsroom at low cost.

Continue reading - http://seekingalpha.com/article/148180-print-ad-losses-to-the-internet-it-ain-t-over-yet

Take It to the Bank - Stashing cash in banks is safe again

Reading - Take It to the Bank - Stashing cash in banks is safe again http://online.barrons.com/a...

IF YOU REMAIN SHELL-SHOCKED FROM THE near-obliteration of your stocks, bonds and retirement nest egg by the Great Recession, then -- metaphorically speaking -- have we got a bunker for you. It's called a bank.

Seriously. Assuming no sudden spike in the rate of inflation, your bank is one of the safest places for your principal, owing to an expanded federal-insurance backstop on savings accounts, retirement accounts, trust accounts and certificates of deposit.

Structure your holdings correctly and, as an individual, you can obtain more than $1 million in coverage per bank. A couple can get about $2 million in coverage per bank. (A synopsis of the rules is at http://www.fdic.gov/deposit/deposits/DIfactsheet.pdf.) This means that should your bank go belly-up, your principal and interest below the insured maximum remains safe. (One danger: Bank rates are so low that if the rate of inflation should best them, you might experience a negative real rate of return.)

PRIOR TO THE NEAR-TOTAL COLLAPSE of our financial industry, the Federal Deposit Insurance Corp. covered no more than $100,000 for savings, retirement accounts and irrevocable trust and revocable trust accounts. This added up to a grand total of $400,000 per person per bank and $800,000 for couples. Now, however, until Dec. 31, 2013, these accounts are insured for as much as $250,000 per person, per account. (The FDIC has a calculator on its site called EDIE, or Electronic Deposit Insurance Estimator, to help determine whether you are fully covered at your bank:https://www.fdic.gov/edie/index.html.)

Congress allowed the temporary increase in deposit coverage to avert runs at weakened banks and to restore confidence in the overall system. The new policy seems to be working. Deposits during the first quarter climbed by $82.4 billion, or 1.7%, to $7.5 trillion. There are more than 8,200 financial institutions in the U.S. backed by the Federal Deposit Insurance Corp.

Continue reading - http://online.barrons.com/article/SB124727466034526301.html