Lunchtime Links 10-2

October 2, 2009

Schadenfreude AlertSandy Weill falls off Forbes 400 list (DealBook) He’s still doing ok.

Ken Lewis doesn’t get a golden parachute, but he will get a $53 million pension (CNN)

Banks with 20% unpaid loans at 18-year high (Bloomberg) The figure should be higher: “The calculation didn’t include restructured loans modified after borrowers couldn’t keep up with the original terms, which have default rates of 40 percent to 60 percent within two months, according to SNL senior analyst Sebastian Hindman.”

Hours worked per person tailspin continues (Econompicdata) Interesting charts. Of course the headline number is that the unemployment rate is now at 9.8%.

Fed draws court’s eyes in Lehman bankruptcy (WSJ) Did the Fed jump ahead of other creditors unfairly?

Greenspan says Fed balance sheet an inflation risk (Reuters) Really, he sounds like Warsh. We have to unwind….but not yet. Felix has a more thorough takedown here.

Letterman reveals extortion plot, admits to affairs with staffers (ABC)

Dwarves found “theme park” commune to escape bullying (Telegraph)

Ted Williams’ frozen head abused at cyronics facility (NY Daily News)

You are being shagged by a rare parrot…

2 comments

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The view from the other side of the spectrum …(Feel free to comment :)I am glad he is not Obama’s “Job tzar”. The question isdo any of his tzars have similar views … likely so.Enjoy !———————————–http://robertreich.blogspot .com/2009/10/truth-about-jobs-that-no-on e-wants-to.htmlThursday, October 01, 2009The Truth About Jobs That No One Wants To Tell YouUnemployment will almost certainly in double-digits next year — and may remain there for some time. And for every person who shows up as unemployed in the Bureau of Labor Statistics’ household survey, you can bet there’s another either too discouraged to look for work or working part time who’d rather have a full-time job or else taking home less pay than before (I’m in the last category, now that the University of California has instituted pay cuts). And there’s yet another person who’s more fearful that he or she will be next to lose a job.In other words, ten percent unemployment really means twenty percent underemployment or anxious employment. All of which translates directly into late payments on mortgages, credit cards, auto and student loans, and loss of health insurance. It also means sleeplessness for tens of millions of Americans. And, of course, fewer purchases (more on this in a moment).Unemployment of this magnitude and duration also translates into ugly politics, because fear and anxiety are fertile grounds for demagogues weilding the politics of resentment against immigrants, blacks, the poor, government leaders, business leaders, Jews, and other easy targets. It’s already started. Next year is a mid-term election. Be prepared for worse.So why is unemployment and underemployment so high, and why is it likely to remain high for some time? Because, as noted, people who are worried about their jobs or have no jobs, and who are also trying to get out from under a pile of debt, are not going do a lot of shopping. And businesses that don’t have customers aren’t going do a lot of new investing. And foreign nations also suffering high unemployment aren’t going to buy a lot of our goods and services.And without customers, companies won’t hire. They’ll cut payrolls instead.Which brings us to the obvious question: Who’s going to buy the stuff we make or the services we provide, and therefore bring jobs back? There’s only one buyer left: The government.Let me say this as clearly and forcefully as I can: The federal government should be spending even more than it already is on roads and bridges and schools and parks and everything else we need. It should make up for cutbacks at the state level, and then some. This is the only way to put Americans back to work. We did it during the Depression. It was called the WPA.Yes, I know. Our government is already deep in debt. But let me tell you something: When one out of six Americans is unemployed or underemployed, this is no time to worry about the debt.When I was a small boy my father told me that I and my kids and my grand-kids would be paying down the debt created by Franklin D. Roosevelt during the Depression and World War II. I didn’t even know what a debt was, but it kept me up at night.My father was right about a lot of things, but he was wrong about this. America paid down FDR’s debt in the 1950s, when Americans went back to work, when the economy was growing again, and when our incomes grew, too. We paid taxes, and in a few years that FDR debt had shrunk to almost nothing.You see? The most important thing right now is getting the jobs back, and getting the economy growing again.People who now obsess about government debt have it backwards. The problem isn’t the debt. The problem is just the opposite. It’s that at a time like this, when consumers and businesses and exports can’t do it, government has to spend more to get Americans back to work and recharge the economy. Then – after people are working and the economy is growing – we can pay down that debt.But if government doesn’t spend more right now and get Americans back to work, we could be out of work for years. And the debt will be with us even longer. And politics could get much uglier.

Posted by Mark | Report as abusive

“Then – after people are working and the economy is growing – we can pay down that debt.”How many times in the past 50 years did Governments say we will pay down the debt?Rolfe, can you calculate the number … If indeed Governments will take/use 10% of family annual incomes, it would take over — (250?) years to pay down the debt.

Posted by Mark | Report as abusive