Links 4/17/14

Ruff justice! French dogs voted ‘living beings’ after centuries of slumming it as ‘personal property’ (…and it means wealthy Parisiennes can leave their fortunes to them) Daily Mail

Monetary Policy and the Economic Recovery Chair Janet L. Yellen At the Economic Club of New York, New York, New York

In sum, the central tendency of FOMC participant projections for the unemployment rate at the end of 2016 is 5.2 to 5.6 percent, and for inflation the central tendency is 1.7 to 2 percent. If this forecast was to become reality, the economy would be approaching what my colleagues and I view as maximum employment and price stability for the first time in nearly a decade. I find this baseline outlook quite plausible.

Out of Ammo? The Eroding Power of Central Banks Der Spiegel

Income Inequality Institute Will Pay Paul Krugman $25,000 Per Month [!] Gawker (nycTerrierist). Make up your own jokes!

Michael Bloomberg: ‘I Have Earned My Place in Heaven’ National Journal

Jack Halprin: As a Google Attorney, I Need the Homes of 7 Teachers, and Here’s Why SF Weekly

REVEALED: Gov. Christie’s investment chief has major financial ties to firm that got $300M in NJ pension cash Pando Daily

NY attorney-general subpoenas high-frequency traders FT. Dems fake left for the midterms.

Amid budget shortfall, University of Maine System administrator received $40,000 raise this year Bangor Daily News. Ahem.

U.S. States Revive Debtors’ Prisons FDL

Bank of America’s mortgage crisis costs become a recurring problem Reuters

Bitcoin exchange Mt. Gox says ‘no prospects’ for restart of business LA Times

GM Move to Freeze Lawsuits May Cut Customer Payouts by Billions Bloomberg

Google shares dip as earnings disappoint FT

IBM Sales Fall Again, Pressuring Rometty’s Profit Goal Bloomberg

BlackBerry’s meltdown sparks start-up boom in Canada’s Silicon Valley Reuters

What Happened to Canada? n+1


US financial showdown with Russia is more dangerous than it looks, for both sides Ambrose Evans-Pritchard, Telegraph

EU sanctions push on Russia falters amid big business lobbying FT

Putin Bank Trail Runs From Communist Cash to Billionaires Bloomberg

Globe in Ukraine: Pro-Russian victory gives separatists momentum Globe and Mail

Kiev’s grip on eastern Ukraine weakens as pro-Russians seize army vehicles Guardian

Moldova’s Breakaway Region Asks Putin to Recognize Sovereignty Bloomberg

Ukraine: Kiev Fails Again, Propaganda Aims for WWIII Moon of Alabama


Census Bureau: Question changes make it easier to assess health insurance law WaPo

“Awesome in its evilness”: How to make GOP pay for its Medicaid nightmare David Dayen, Salon

Is Obamacare A Success? We Might Not Know For A While NPR

The Neoliberal Turn in American Health Care Jacobin

Big Brother Is Watching You Watch

Excerpts of interview with former top CIA lawyer John Rizzo McClatchy

In the One-sided Foreign Intelligence Surveillance Court, It’s Hard to Get The Whole Story EFF

Out in the Open: Inside the Operating System Edward Snowden Used to Evade the NSA Wired

Phatra Securities analysis of the political situation Asian Correspondent

Chinese Mistress’s ‘Confession’ Kicks Off Internet Furor Asia Sentinel

Finland celebrates homoerotic art with mustachioed stamps The Verge

Unfinished Business Complicates Hillary Clinton’s Diplomatic Legacy Times

When Did Men’s Income Peak? Demo Memo

The eastern United States: A lonely cold pocket on a feverish planet WaPo

The World According to Modern Monetary Theory The New Inquiry

Karl Polanyi Explains It All The American Prospect

Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens Perspectives on Politics, Fall 2014 (forthcoming)

The central point that emerges from our research is that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while mass-based interest groups and average citizens have little or no independent influence.

Antidote du jour:


See yesterday’s Links and Antidote du Jour here.

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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. diptherio

    Old Yellen says:

    If this forecast was to become reality, the economy would be approaching what my colleagues and I view as maximum employment and price stability for the first time in nearly a decade. I find this baseline outlook quite plausible.

    There will be growth in the spring, my friends; the chair has declared it…we are surely only one or two Friedman-units from a turning point, no?

    1. Jim Haygood

      Central banksters masquerading as fortune tellers: twenty-second century historians will be astonished at our superstitious acceptance of such absurd charades.

      The FOMC’s PhD morons couldn’t predict a solar eclipse with an ephemeris in hand. Next time the sun goes dark, it’s their fault!

      1. Brindle

        So $50K in 99 ($70k-$80k today?) for one meeting?

        —“So what was my relationship with Enron?  I was offered a $50,000 fee for a year’s participation in the advisory board, which would entail attending and presenting at two meetings, each of which would extend over two days. The year I was on the board only one meeting took place; the other was canceled because of weather.”—

        1. Klassy

          So many words to choose from, but I’ll go with this. Short and sweet:
          “By the way, here’s the piece I wrote in Fortune. It looks a bit naive now, but it’s a love letter to markets, not to Enron. “

        2. Klassy

          Dearest Markets,
          I saw you across the room. Did you see me? I turned away quickly. Shyness? Maybe. Or maybe I was overwhelmed by your efficiency in allocating capital….

            1. hunkerdown

              Seconded! Or better still, maybe write that in flowy script on parchment and put it behind the site header.

  2. Ned Ludd

    Edward Snowden asks Vladimir Putin about mass surveillance (just before the 3 hour mark). The host puts on a show of translating (live!) the pre-recorded question for Putin (which is then translated back into English, for the RT video). Putin then pretends not to lie.

    Next question. “So everyone is wondering, when will we see the new first lady?”

      1. ohmyheck

        Being somewhat cynical—- do you really think that Putin didn’t know Snowden was going to be one of the questioners? I guess it could happen. I really don’t know how this press event works.

      2. Ned Ludd

        I think Snowden’s question was allowed by Putin, so Putin could make himself look more restrained and law-abiding compared to Obama. If evidence emerges later that reveals that Putin lied, I doubt it will have much impact on Putin’s political career. Over time, negative stories simply disappear when people with power control the narrative.

  3. pretzelattack

    it’s a bit hard for me to go into a “rule of law” conniption fit over the bundy debacle when the banks, the nsa et all have been busily destroying it for at least the last decade. but it is the first time I remember the feds backing down in a situation like this.

    1. Cocomaan

      Much easier to demonize everyone involved in the Bundy ranch issue as right wing extremists, or profit seekers, as Lambert said yesterday, than to see it as part of a symptom of an out of control federal government. Yesterday I saw a user on DailyKos saying that NSA spying was justified if it was being used to shut down Bundy…

      Hell, haven’t seen one person on the NC commentariat point out that it wasn’t US Marshals that carried out the court order by the Nevada District Court, but armed Interior Department personnel, cowboy contractors, and park rangers. Wow! Remember the good old days when it was the Marshals that carried out the will of the courts, not the variety of private armies being built by the executive branch? Not one peep about that.

      Mind the source, but the BLM and their contractor cowboys allegedly were shooting cattle and stomping all over tortoise burrows out there on the ranch. Good stewards!

      1. Johann Sebastian Schminson

        I’ve been out west, on public land that ranchers think they own. If there ever was a pack of undeserving welfare queens, it’s them.

        As Guthrie said: This land is your land, this land is my land.

        Tell fake-assed cowboy to get the F off, pay up, and keep your bovines in his own goddamned yard.

        1. Johann Sebastian Schminson

          BTW: Since these critters are apparently free-range and ownerless, the BLM/Interior should take them by eminent domain and offer hunting licenses for the strays.

      2. Lambert Strether Post author

        The rest of the country is subsidizing Bundy’s entire enterprise [counter-argument]. I suppose at this point everybody’s entitled to follow the ruling class and grab for whatever they can, but Bundy combining his land grab from the rest of us with Marlboro Man-style rhetoric about freedom and liberty is just a little much for a weak stomach like mine. One of these cases where the enemy of my enemy is not necessarily my friend, so far as I’m concerned.

        NOTE Surely the grasslands and the water are common pool resources? If so, the issue of whether the land is owned by the State or by Bundy is a false dichotomy.

        UPDATE I think “demonize” is just a little harsh. There’s a lot of labor in demonizing. Let’s not confuse it with a snarky love tap.

        1. down2long

          Absolutely agree with you Lambert. I grew up in Alaska whe, so thre
          “StateFirsters” just means they grab the commons for themselves. Never figured out how that Welfare State would support itself without Uncle Sugar. For every Fed tax dollar they pay, they get six back. And the corrupt state government is giving away everything that’s not nailed down to the oil companies, so that won’t work.

          That said, I agree with pretzelattack. It is now clear the only thing that will back down the Feds is guns. They will let the banks rob and pillage, let the oil cos steal us blind and pollute the hell out of us, even renege on paying

          fracking fees to duped Pennsylvania landowners. If a well armed progressive militia suddenly showed up to help those people get piad, or stop an illegal forclosure, etc. Things might change.

          1. Binky Bear

            To be fair, most of the land in Alaska is federally owned (National parks, wilderness, wildlife refuges, BLM lands) and managing it takes a fair chunk of money that is counted of a piece with transfer payments, military bases, keeping up the post offices and subsidizing air mail routes. Alaska is huge and not connected by road or rail outside a limited area. Oil money pays for everything, which is why we weren’t a state until two years after the 1957 discovery of producible oil and gas on the Kenai Peninsula at Swanson River.

            That said I think it should be clear that BLM and the courts did a good job by not turning one grifter’s histrionics into another colorful martyr for the wingnuts to fap over. It took twenty years to get to this point and if it takes a few more to handle this guy then that’s a cost effective and humane and just way to handle it. I think there is a very real risk of more right wing uprisings like in the 1980s, when the Order were robbing banks and the skinheads were taking North Idaho over (giving us the Weaver Family episode,etc.).

          2. hunkerdown

            I don’t think so. Leftists are unwilling to deal in unfair structures, so capital generally considers them expendable at best and disease vectors at worst. The results of a leftist militia doing what Bundy and compatriots did would necessarily depend on who’s got their back. If the quisling bourgeoisie can’t be bothered to do anything but march and raise signs, expect slaughter. If they actually could be bothered to signal their willingness to deny cooperation with vested authority en masse, expect martial law. If China or Russia had their back, expect a completely incoherent flood of cover noise, assassinations and the renaming of the Senkaku Islands.

            In all cases expect FBI to run cover for snipers working for vested interests, just as they did at Occupy. I just don’t see the system allowing the left to win. That’s not American and that’s not neoliberal.

            As an aside, I’ve been slightly worried about whether and what fallout from Bundy is going to land at Burning Man.

            1. Paul Tioxon

              Here are armed leftists in Philadelphia and what the PA State Police and the Philadelphia Police did to them during their SECOND!! armed standoff with an 8 year period. Just so you know what happens when people arm themselves in the bowels of the East Coast Liberal Establishment Founded by Peace Loving Quakers: Submitted for your approval MOVE.



        2. Yves Smith

          So why haven’t the Feds gone the economic sanctions route, as in seizing Bundy’s bank accounts and foreclosing on his property (as in you put a lien on it and then foreclose)? Rounding up cattle is much harder. Or does he not have any land at all?

          1. Katniss Everdeen

            Probably for the same reason they never just arrested David Koresh when he rode his bicycle into town twice a week. As he was KNOWN to do.

          2. bob

            In my reading, he’s a pretty clever man. Since the court fight in 93, his heard went from 150 to over 500 on the BLM land.

            “Go ahead, move ’em.” But, as you point out, it isn’t easy to repo that many cattle. Where do you put them? Feed them? Clean up after them?

            I’ve also wondered about his other assets, and what has happened with them over time.

            I think the BLM would have had much more support if it offered up a free BBQ. Or, sell hunting licenses…

      3. Peter Pan

        Well, the BLM and the Park Service (rangers) are under the Department of the Interior. IRCC, they’ve been armed and enforcing the law ever since I started hiking on their lands in 1974. Of course, the next time they go after Bundy’s cattle they may elect to ask for assistance from the Department of Justice by sending in the Marshall Service and the FBI along with BLM and Park Rangers. Who knows, maybe the NVNG will be federalized by Obama and they’ll be sent in, too. (Hmm, I wonder if they have drones at Nellis AFB/Tonopah/Area 51?)

        Now if ICE, Border Patrol and DEA agents show up, I’ll sort of be freaked out. (They’re illegal immigrant drug smuggling cattle !!)

  4. Jim Haygood

    From the NYT’s ‘Unfinished Business …’ article:

    “Hillary unbound,” people who worked with her say, would be instinctively less reluctant than Mr. Obama to commit the military to foreign conflicts.

    “It’s not that she’s quick to use force, but her basic instincts are governed more by the uses of hard power,” said Dennis B. Ross.


    Hillary is fond of paraphrasing Stalin, but with a revealing twist: ‘No men, no problem.’

    1. ignim brites

      There is a good chance that Ms. Clinton will be the most militaristic candidate in the field going into 2016. The TAC crowd in winning the argument on the right which pretty much guarantees that non-interventionism ( I’m sorry, isolationism) will dominate the foreign policy debates in the Republican party. But can Ms. Clinton win the Democratic party nomination as the neo-con candidate? Very unlikely.

      1. hunkerdown

        Why not? The national party bosses are quite skilled at getting the votes they want. Remember the Jerusalem-and-God plank in the platform that had to be revoted thrice before the officiating LA mayor “called” the “correct” result (as per the party bosses)? And how there was a news cycle worth of complaining afterwatd and exactly nothing?

  5. rich

    Go Public
    McDonald’s foreign workers call it ‘slavery’
    Belizian temporary foreign workers docked pay for rent in corporate apartment

    Foreign workers recruited from Belize are accusing McDonald’s Canada of treating them like “slaves,” by effectively forcing them to share an expensive apartment – then deducting almost half their take-home pay as rent.

    “When we arrived at the airport, they said, ‘We already have an apartment for you,’ so at that point we already know we don’t have a choice of where to live,” said Jaime Montero, who came to Edmonton with four others in September to work at McDonald’s.

    “We had to live there. We were told this is what we are doing,” said another worker who didn’t want to be named because he still works for McDonald’s.

    The Belizeans said their dream of making good money in Canada to send to their families quickly shattered. Instead, they pocketed less than $800 per month – which they said was barely enough to live on.

    1. Chris S.

      We’ll be seeing a lot more of this soon, I suspect, except in the US it will be done with skilled workers.

      No need to hire unskilled workers from abroad here.

  6. Adam S.

    Re: Out of Ammo? The Eroding Power of Central Banks

    The authors lost me after their fellating the Dallas fed chair without any challenge, especially with this sentence:

    “Companies don’t invest as long as they don’t know how their tax burden will look in the coming years, and as long as they don’t invest, the economy will remain sluggish.”

    without any comment.

    Hooray for good gernalism, Der Speigel. Which, by happenstance, is German for The Spiegel.

    1. tiebie66

      I found part 5 on the emergence (and the size) of the financial cycle rather interesting. Did you stop reading too soon?

      1. allcoppedout

        One might think Der Spiegel went through the looking glass with Alice on an invite to the banksters’ tea-party. They found Minsky alive and well, not realising they had travelled back in time and their copy was doomed to be 40 years out of date. It would have been cheaper to have popped over to Oz and have a chat with Steve Keen.

        Anyone by any chance seen any bank reports on how much we need to spend on green energy capacity to stop us burning fossil fuels?

  7. Tyler

    I don’t understand why it’s a bad thing that “Income Inequality Institute Will Pay Paul Krugman $25,000 Per Month.” It’s not like Krugman is being paid to steal, like the banksters.

      1. sd

        Gawker cites Petreaus as an example of lower pay. Petreaus collects a military pension of about $200,000 per year.

      2. Romancing the Loan

        If you read the offer letter, they’re basically paying him to do nothing – i.e., they’re paying him for the privilege of having his name associated with them and upping their likelihood of getting upper class NYT liberal cred and resultant NGO money. I wouldn’t expect an organization like that to produce much but cushy jobs for their otherwise unemployable but expensively educated children. They’ll increase income inequality just by studying it. Fantastic. Why do I expect that the end result of their studies will be that inequality is a. unavoidable anyway and b. not really all that bad?

        The ancient comic strip Judge Parker is stupidly accurate – when you’re rich, people really do just seem to shovel gobs of money at you, all the time.

          1. MyLessThanPrimeBeef

            That’s right there with ‘improving the world by changing definitions.’

            You will notice both involve no manual labor, but are merely simple intellectual activities.

            1. allcoppedout

              How does he get his tongue up to the pointy-bit at the top of his head to lick the ice cream? Easier to conceptualise this when you realise he is an alien reptile cone-head.

    1. Klassy

      I’m not sure about that article– discusses balanced budget mania of the Liberal party, but then states Canadians would be willing to raise taxes to pay for services. They even concede in the article that cutting services has nothing to do with the budget, so why is it a good thing for Canadians to want to raise taxes “to pay for services”?
      As for Canada weathering the crisis better, it is true that their banks are more regulated, but that doesn’t preclude a growth in household debt. I read somewhere that Canadians had more household debt than US households.
      They have their Harper, but who will serve as their Clinton/Blair to put the finishing touches on the whole project?

  8. JEHR

    Thank you for the link to What Happened to Canada (n+1). It tells the story of how quickly a country can change from a social democracy to a neoliberal fascist state. If Harper is not defeated in 2015, Canada will be a ghost of its former self with no civil liberties, with high spending on security and military hardware, with austerity at new highs, with the environment scorched and sickened by toxic tar sands development, with elections bought rather than voted for, with the rescinding of all programs that assist the welfare of the public, with the privatization of all public entities such as power, water, sewage, roads, healthcare, education, the prison system, etc.

    We will look like that feudal state that Michael Hudson often describes when he talks about the end-game of the oligarchs. We will become the Canadistan of the North! It will be a nightmare of Harper’s devising.

    1. Lambert Strether Post author

      NMB, I’m getting a just little weary of your daily link-whoring for the “failed evolution” site, although granted, at least today it’s not the very first comment. What if we had ten or a hundred readers who do what you do? I’d be more inclined to take the site seriously as a contribution to the comments section if you didn’t just dump the URL in order to direct readers away from Naked Capitalism.

      1. no more banksters

        No problem. I thought it was OK, but I’ll stop. Thanks for uploading a few articles of the blog in suggested links. NC (was) my facebook. ZH is my twiiter until they tell me to get lost of course!

        Thanks again

      1. OIFVet

        I agree also, it appears to be a planted propaganda. To be fair, there are plenty of Russian neo-fascists in Donetsk, The Exile covered that back in the day. It would be rather stupid of them to pull such a move after all the noise about their Ukrainian counterparts. Not that the regular neo scum is particularly smart, but one would think at least their leadership might be somewhat intelligent.

        1. notexactlyhuman

          The story appears to originated from the Jerusalem Post, but in their version the separatists deny involvement. The cooked version is the one trending, however. Dirty tricks.

    1. notexactlyhuman

      No one home in room 514. Jew registration mandate is phony. Claims that separatists admitted to dispensing the pamphlets are propaganda, though many US outlets have already run with it.

      And it appears war has been averted via a Geneva conference, for now, maybe, perhaps.,0,5148567.story#axzz2zAZaughZ

      1. OIFVet

        It is definitely a dirty trick. Heard an excerpt of the Haircut in Search of a Brain and Nuland’s co-conspirator Pyatt both worked up the “incident.” Seems to be an effort to discredit the protestors and apply pressure on the Russians. Gotta love US hypocrisy and scumbaggery: “hey, we got called out for jumping in bed with Ukrainian neo-nazis so let’s try to frame the resistors to the mess we created as neo-nazis.” Executed with all the subtlety and finesse of a sledgehammer.

  9. MyLessThanPrimeBeef

    When did men’s income peak?

    The way it’s going, if men remain ‘unreformed’, they will one day be on the endangered species list, when women succeed and learn to do – to have fun or reproduce – without them.

    At that time, they, men, will be protected, as members of an endangered species, to preserve their merry way of life.

    That’s the irony of life.

    1. Nobody (the outcast)

      I’m with Bill Mollison (a founding father of permaculture). In his travels around the world visiting nearly every country, he came to the conclusion that men are near worthless and women do all the important work. (And some people accuse permaculturists of being sexist because the ones in front of the public are almost always male. Reverse-sexist maybe?)

      @ Lambert, Just a heads-up that International Permaculture Day is May 4th, wink-wink.

  10. Chauncey Gardiner

    Luved the satire from the SF Weekly blog regarding the displacement of seven school teachers from their homes so a single Google employee could have their shelter for lebensraum.

    Too bad the goddess Harmonia of the ancient Greeks proved mortal after all.

  11. rich

    Looks like Taibbi is spot on….

    Charleston Man Receives $525 Federal Fine for Failing to Pay for a $0.89 Refill

    Some of you may wonder why of all the stories out there today I decided to focus on the $525 fine a construction worker in South Carolina received a for refilling his drink without paying. The reason is to highlight the difference between what happens when a peasant breaks the law versus when a banker does it.

    In this case, citizen Christopher Lewis refilled his drink without paying at the VA Medical Center in downtown Charleston. For this horrific offense (a refill costs $0.89), he was hauled into a room by the Federal Police Force and given a ticket for $525. Even worse, he was told not to ever come back to the premises, so he ended up losing his job as well.

    So for this undoubtably minor offense, Mr. Lewis received a fine almost 600x greater than the cost of the crime and lost his ability to support himself. Compare that to the slap on the wrist banks receive when they are caught engaging in criminal behavior that leads to the theft of billions of dollars. At the worst, they pay a fine that is only a fraction of the profits and no one goes to jail, so the law actually incentivizes major financial crime. Meanwhile, if a peasant steps out of line, even for the most minor offense, the full brute force of federal law comes down like a ton of bricks. This is one of the main reasons why the social fabric of society is being torn apart, and unfortunately, there will be a hefty price to pay for it in the future.

  12. Jeff N

    [newly minted CEO] Homer [Simpson]: “Unlike Mr. Burns, I will respect you, the working-class slob, because we are all equals! And now, as I ascend this crystal staircase to my office, I say: avert your gaze!”

  13. Jeff N

    Alex Blumberg: They simply compared the amount that companies spent lobbying with the amount they saved on their taxes. They came up with a figure. A figure they called “the return on investment for lobbying.”… The return on investment to lobbying, in the case of Alexander’s study–

    Raquel Alexander: 22,000%. So, for every dollar, on average, that these firms spend on tax lobbying, they receive $220 in tax benefits from this repatriation provision.

    Alex Blumberg: Were you expecting it to be that big?

    Raquel Alexander: I was not. I was not expecting it to be that big at all. I thought I needed to go back and check my math again.

    Alex Blumberg: So after the fifth or sixth time checking, you were like, well, this is the number.

    Raquel Alexander: After the 20th time of checking.


  14. Hugh

    Somehow Yellen is all hard and fast on maximum employment being reflected by a “central tendency of the Committee’s projections” for an unemployment rate of 5.2-5.6%. She then goes all fuzzy when it comes to the degree of slack in the “labor market” which in this case means both those in and outside the labor force.

    There are a couple of things to say about Yellen’s speech. The first is she does not say word one about the crap nature of the jobs being created in this country. The second is Yellen is promoting the high levels of structural unemployment argument, although her levels 5.2-5.6% are lower than others like Krueger (labor economist at Princeton who was part of the Obama Administration) who are pushing 6.7%, i.e. the current unemployment level.

    What is important to understand is that these are “official” unemployment rates. The real unemployment rate, as I keep pointing out in my monthly jobs analyses, is 5+% higher.

    I think the main hope for our elites represented by Yellen and Krueger is that the Boomers will retire out of the labor force and solve the unemployment problem for them, but again the real unemployment rates are much higher and so that is going to happen.

    Another thing is that in the 53 months from May 1997 to September 2001 and in the 35 months from June 2005 to February 2008, the official unemployment rate was at or below 5%. Indeed it hit its low in April 2000 at 3.8%.

    So why are the Fed and Yellen talking about a higher level of official unemployment? I think this has to do with the concept of the NAIRU, the non-accelerating inflationary rate of unemployment. While the Fed has shoveled trillions to the banks and been chiefly responsible for the bubbles we are seeing in equities, commodities, and emerging markets, it has waged a 35 year war against increases in workers’ wages. The 5.2-5.6% level of official unemployment is in other words the level the Fed thinks is needed to keep workers’ wages suppressed. While Yellen is not Bernanke, some things never change.

    1. TomDority

      I would have to agree with your analysis…. it is the rate of unemployment needed to keep wages suppressed and is also related to the underemployment level.

      Structuraly, the standard of living will not rise.., it’s capped. The standard of living can only go down as far as the citizens will allow…. that point is truley never recognized until the flashpoint occurs. It’s why it’s called a flashpoint and, the oligarchs have been refining the flashpoint number for years now.

      1. allcoppedout

        Nearly half of US is in a state of liquid asset poverty. This is true in this half of USUK too. Here the bottom half owned 14% of liquid assets in 1980 and this is down to 1% today.
        Recent US study here – The report pays specific attention to what it terms “liquid asset poverty,” in which a four-person household maintains less than three months’ worth of savings, or $5,887, at any given time. Roughly 44 percent of all US households fall into this category. 89% of these people are in employment and 48% has college-level education.

        TINA has actually produced a no way out society.

  15. JTFaraday

    That poor dog looks like he’s having a “cute emergency.” Something like “Get me out of this damn baby swing already.”

  16. rich

    Company On Major Highway Job Fires, Sues VP

    Centerplan’s CEO, former Democratic state Rep. Robert Landino, said in an interview last week that he knew Papandrea through state politics, but hired him three years ago because Papandrea had held a responsible position with another construction company.

    Centerplan is a key construction management subcontractor on an ongoing, massive project to reconstruct all 23 service areas along I-95, the Merritt and Wilbur Cross parkways and I-395 in eastern Connecticut.

    The project dates back to the administration of former Gov. M. Jodi Rell in 2009. Its original estimated cost of $500 million is privately funded under an unusual 35-year concession agreement between the state and a prime contractor, Project Service LLC.

    Project Service’s lead member is The Carlyle Group, an international investment giant. The state Department of Transportation, which is monitoring the project and performing inspections, declined comment.

    According to the lawsuit, Papandrea approved payment of contractor invoices to Centerplan for work that was “performed at [his] residence instead of Centerplan’s client projects,” thereby obtaining “free labor, materials and services for his residence in excess of $50,000.”

    The company claims in the suit that Papandrea “knowingly assisted another [employee] in committing similar wrongful conduct.” Centerplan is seeking unspecified money damages and “disgorgement of [Papandrea’s] salary and benefits.”

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