Toon in

When the bill comes due

Singing “Happy Days Are Here Again” and partying hearty is fun until the end of the month when the credit card bill arrives. Argentina got theirs and found out the interest rate is much higher than believed.
Once more that Socialist country’s economy circles the drain, in default with the hedge find debts which if paid would have required offering similar terms to other bondholders.
Over the edge into the deep water again.

Argentina Declared in Default by S&P as Talks Fail

Standard & Poor’s declared Argentina in default after the government missed a deadline for paying interest on $13 billion of restructured bonds.

The South American country failed to get the $539 million payment to bondholders after a U.S. judge ruled that the money couldn’t be distributed unless a group of hedge funds holding defaulted debt also got paid. Argentina, in default for the second time in 13 years, has about $200 billion in foreign-currency debt, including $30 billion of restructured bonds, according to S&P. [snip]

“The full consequences of default are not predictable, but they certainly are not positive,” Pollack wrote in an e-mailed statement. “Default is not a mere ‘technical’ condition, but rather a real and painful event that will hurt real people.”

Kicillof, speaking at the Argentine consulate in New York, told reporters that the holdouts rebuffed all settlement offers and refused requests for a stay of the court ruling. He said Argentina couldn’t pay the $1.5 billion owed to the hedge funds because doing so would trigger clauses requiring the country to offer similar terms to other bondholders. He also criticized the judge in the case and ratings agencies.

Such a piddling amount when compared to our national debt. The only thing currently saving us is the printing press; the world still takes the dollar as the reserve currency. T BRIC’s are working on changing that. If America’s dollar loses it’s status as the reserve currency, with the debt we have, we’ll become a third world country with nothing but debt and no way to purchase imports.

This probably is Obama’s goal: To reduce America to penury.

The Government Motors bubble

Obeimanomics plus unions drive GM over the edge.

General Motors Executive Warns of Impending Auto Bubble

General Motors of Canada President Kevin Williams is warning that subprime loans could doom the auto industry just as it did the housing industry in 2007.

Williams told the editorial board of Canada’s Globe and Mail newspaper on Monday that record Canadian auto sales could be attributed to cheap credit loans.

“The real question is, are you going to run the business the way you ran it in the past in order to drive market share exclusively. The answer is that’s not our intent because it [led to] a failed company,” Williams said.

Using subprime loans and easy credit to move cars off the lot may not be GM Canada’s goal, but its parent company, bailed-out, Detroit-based General Motors, has been moving in that direction, as the Washington Free Beacon reported in February. Nearly 90 percent of loans issued by GM Financial were subprime.

GMF has the riskiest lending portfolio of any major car company: 96 percent of its customers have credit scores below 660. GM’s lending habits parallel those in the housing market leading up to the 2008 crash…GM finished the year with 8.5 percent of loans in delinquency, the highest rate since 2010 and larger than the delinquency rates at Ford, Toyota, and Honda combined.

GM Financial isn’t the only entity at risk. The company has been packaging the loans and selling them off to Wall Street banks—just as many mortgage lenders did with housing loans. [snip]

BOHICA taxpayers, Government Motors is about to get a toe tag, along with some of the banks.

If you own stock in GM or these banks, bring soap. It’s bath night.

Back in the early ’90’s, I repossessed an average of 2 to 3 cars a day. Pay was $100 to $150 a car. Many were new, some never had the first payment made. Individuals with a credit rating that couldn’t support a skateboard, had BMW’s to Pathfinders. Banks took the pipe.
I still have my repo tools.

Snickers & Snarks

Dumping high earning workers boosts the bottom line.

Company loyalty: Putting the skids to the American worker.

Companies lay off thousands, then demand immigration reform for new labor

On Tuesday, the chief human resources officers of more than 100 large corporations sent a letter to House Speaker John Boehner and Minority Leader Nancy Pelosi urging quick passage of a comprehensive immigration reform bill.

Employment

The officials represent companies with a vast array of business interests: General Electric, The Walt Disney Company, Marriott International, Hilton Worldwide, Hyatt Hotels Corporation, McDonald’s Corporation, The Wendy’s Company, Coca-Cola, The Cheesecake Factory, Johnson & Johnson, Verizon Communications, Hewlett-Packard, General Mills, and many more. All want to see increases in immigration levels for low-skill as well as high-skill workers, in addition to a path to citizenship for the millions of immigrants currently in the U.S. illegally.

A new immigration law, the corporate officers say, “would be a long overdue step toward aligning our nation’s immigration policies with its workforce needs at all skill levels to ensure U.S. global competitiveness.” The officials cite a publication of their trade group, the HR Policy Association, which calls for immigration reform to “address the reality that there is a global war for talent.” The way for the United States to win that war for talent, they say, is more immigration.

Of course, the U.S. unemployment rate is at 7.3 percent, with millions of American workers at all skill levels out of work, and millions more so discouraged that they have left the work force altogether. In addition, at the same time the corporate officers seek higher numbers of immigrants, both low-skill and high-skill, many of their companies are laying off thousands of workers. [snip]

“It is difficult to understand how these companies can feel justified in demanding the importation of cheap labor with a straight face at a time when tens of millions of Americans are unemployed,” writes the Center for Immigration Studies, which strongly opposes the Senate Gang of Eight bill and similar measures. “The companies claim the bill is an ‘opportunity to level the playing field for U.S. employers’ but it is more of an effort to level the wages of American citizens.”

The days of the gold watch are long gone.

Upon Norman’s Woe sails the Fed

If you haven’t bought precious metals to hedge against inflation, you’re in for a shock.

The Fed has pumped so much money into the economy that real inflation is already eating into your purchasing power.
Gas and groceries, clothing and health care are rising faster than earnings now. The phony inflation index the government uses doesn’t include those items.

Fed will get its inflation; here’s who will pay

What’s good for central banks isn’t always good for the individuals they are supposed to serve, a lesson likely to come into view even more clearly in the days ahead.

Higher inflation that’s to come will mean still-tough times for savers and retirees, whose money has generated little return since the Fed took over the post-crisis economy.

After pulling the U.S. economy back from illiquidity and indeed the brink of insolvency during the 2008-09 dark days of the financial crisis, the Federal Reserve has been on a thus-far fruitless crusade to generate positive levels of inflation. [snip]

Inflation has been confined to the corners that central bankers generally dismiss—rising commodity prices that manifest themselves in gas and groceries—while the numbers economists focus on remain tame, at about 2 percent in the latest readings.

The Fed has set 2.5 percent inflation and a 6.5 percent unemployment rate—currently at 7.3 percent—as the minimum levels for raising interest rates.

In the interim, savers have suffered under the yoke of low interest rates that have helped finance the U.S. debt load while stock market speculators have reaped a bonanza.

But with interest rates accelerating, the economy growing and the Fed charting a course to exit its historically easy monetary policy, the inflation picture could begin changing. [snip]

In a commentary published with the Financial Times, Rosenberg paints a scenario of an uncertain level of inflation ahead and what that means:

It is not possible to keep real short-term interest rates negative for this long in the face of even modestly positive real economic growth without generating financial imbalances and inflationary excesses down the road.

That simple statement has been dismissed by Fed supporters, who believe the central bank can unwind its mammoth government debt bailout, including nearly six years of financial repression, without causing shocks. [snip]

There’s also another problem with the Fed and its efforts to engineer a Goldilocks recovery: Continued pain for those who are more conservative with their money, Rosenberg said in the F-T.

The Fed and other central banks are hardly going to be touching short-term interest rates, which will remain negative in real terms for years. So financial repression will remain the order of the day, until the Fed gets what it wants – which is inflation expectations heading up to 2.5 per cent.

The practical impact of that level will mean a 30 percent increase in consumer prices over the next 10 years. [snip]

Obama, through Bernanke, is getting what he wants: The destruction of America and the substitution of Socialism. You’re paying for this, through the nose.

Squealing Lefties

OK fools, did you liberals actually think this couldn’t/wouldn’t happen? La-La Land ends, HARD!Detroit life
Liberals cannot fathom that their policies are the root cause of this fiscal collapse.

Detroit files largest municipal bankruptcy in U.S. history

The city of Detroit filed the largest municipal bankruptcy case in U.S. history Thursday afternoon, culminating a decades-long slide that transformed the nation’s iconic industrial town into a model of urban decline crippled by population loss, a dwindling tax base and financial problems.

The 16-page petition was filed in U.S. Bankruptcy Court in Detroit.

Gov. Rick Snyder’s office was making plans this afternoon to hold a 10 a.m. Friday morning news conference at the Maccabees Building, 5057 Woodward in Midtown, according to his office. It’s the same location where the governor declared a financial emergency for Detroit on March 1 [snip]

Detroit files for Chapter 9 bankruptcy amid staggering debts

[snip] The filing begins a 30- to 90-day period that will determine whether the city is eligible for Chapter 9 protection and define how many claimants might compete for the limited settlement resources that Detroit has to offer. The bankruptcy petition would seek protection from creditors and unions who are renegotiating $18.5 billion in debt and other liabilities. [snip]

Orr spokesman Bill Nowling said: “Pension boards, insurers, it’s clear that if you’re suing us, your response is ‘no.’ We still have other creditors we continue to have meetings with, other stakeholders who are trying to find a solution here, because they recognize that, at the end of the day, we have to have a city that can provide basic services to its 700,000 residents.”

If you want to blame someone, look to the unions in collusion with the city council. They gave away the store.
No taxpayer bailout; let them figure out how to get the money out of their pockets.

Socialism: first degree dementia

Icon face lgeProgressive folly morphs into dementia. The DC dilettantes need more squander money for their frivolity.

Due to Increased Regulations, Millions of Americans Abroad Forced to Reconsider U.S. Citizenship

The Foreign Account Tax Compliance Act, or Fatca, is forcing millions of Americans living abroad to reconsider their U.S. citizenship, a lawyer, Colleen Graffy, writes in the Wall Street Journal.

“The legislation is Fatca, the Foreign Account Tax Compliance Act. To appreciate its breathtaking scope along with America’s unique “citizen-based” tax practices, imagine this: You were born in California, moved to New York for education or work, fell in love, married and had children. Even though you have faithfully paid taxes in New York and haven’t lived in California for 25 years, suppose California law required that you also file your taxes there because you were born there. Though you may never have held a bank account in California, you must report all of your financial holdings to the State of California. Are you a signatory on your spouse’s account? Then you must declare his bank accounts too. Your children, now adults, have never been west of the Mississippi but they too must file their taxes in both California and New York and report any bank accounts they or their spouses may have because they are considered Californians by virtue of one parent’s birthplace,” Graffy explains.

“Extrapolate that example to the six million U.S. citizens living around the globe. Many, if not most, don’t know about these requirements. Yet they face fines, penalties and interest for not complying—even if they owe no U.S. taxes, own no U.S. property, have no U.S. bank account and haven’t lived there in years—if ever.

“A particularly alarming aspect of Fatca is that it seeks to co-opt foreign banks as long-arm enforcement agencies of the Internal Revenue Service—even when it might contravene that country’s own privacy or data-protection laws. If financial institutions don’t report U.S. citizens holding accounts with them, these institutions face a 30% withholding tax on securities transactions that originate in the U.S.” [snip]

And sometimes those Americans perhaps feel that they don’t have much of a choice. “Foreign financial institutions trying to avoid these new requirements have two alternatives: to drop American clients, or don’t invest in the U.S. Neither scenario benefits America.”

Graffy herself lives in London.

This is something one gets in the last stages of collapse.
Think not, read Rome’s history on how it earned it’s toe tag.

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