Wednesday, May 19, 2010
The government said it plans to introduce a bill to raise the retirement age from the current minimum of 60—though it didn't say to what age—and create a new tax on high earners, to try to fix the nation's debt-choked pension system.Unions have scheduled a nationwide demonstration on May 27 to protest the proposed overhaul. (more)
Richard Russell, the famous writer of the Dow Theory Letters, has a chilling line in today's note:
Do your friends a favor. Tell them to "batten down the hatches" because there's a HARD RAIN coming. Tell them to get out of debt and sell anything they can sell (and don't need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won't recognize the country. They'll retort, "How the dickens does Russell know -- who told him?" Tell them the stock market told him.
That's pretty intense! (more)
The net increase was almost a $100bn rise on February – when foreign purchases of long-term securities stood at $47.1bn – and was a new record, according to US Treasury figures.
The marked increase in securities purchases – which saw China become a net-buyer of US assets for the first time in six months – is evidence that the rest of the world continues to view the US as a relative safe haven.
The call came less than two hours before bids were due for contracts to manage $90 million raised with the sale of West Virginia bonds. On one end of the line was Steven Goldberg, a trader with Financial Security Assurance Holdings Ltd. On the other was Zevi Wolmark, of advisory firm CDR Financial Products Inc. Goldberg arranged to pay a kickback to CDR to land the deal, according to government records filed in connection with a U.S. Justice Department indictment of CDR and Wolmark. (more)
Life, liberty and property can't be taken from you unless you're convicted of a crime.
Your life and liberty may still be safe, but have you ever gone to a government surplus auction? Consumer reporters like me tell people, correctly, that they are great places to find bargains. People can buy bikes for $10, cars for $500.
But where did the government get that stuff? (more)
Buffet also trimmed his holdings in 8 stocks while increasing positions in 3.
Positions were reduced in Conoco Phillips (COP), Carmax (CMX), Costco (COST), Johnson & Johnson (JNJ), Gannett (GCI), M&T Bank (MTB), Moodys (MCO) as well as Procter & Gamble (PG).
Buffett reported an increase in holdings in Becton Dickinson (BDX), Iron Mountain (IRM), and Republic Services (RSG).
The total value of Berkshire’s portfolio dropped $7 billion to $50.9 billion from $57.9 billion in the previous quarter.
Fact #1: Banks are Insolvent.
The only reason they’re still in business is because they are permitted to value their balance sheet at whatever price they choose. I could privately value my car at $500 TRILLION, but that doesn’t mean I’ll get that price for it when it comes time to sell.
Ditto for the banks and their garbage saturated balance sheets.
Fact #2: Countries are Insolvent
Europe, a union of broke countries, recently announced it is bailing itself out. This is a bit like your bankrupt friend announcing he is gifting himself $1 million: it DOESN’T SOLVE ANYTHING. As I’ve stated time and again, you CANNOT solve a debt problem by issuing more debt. (more)
Ex-Bundesbank Chief Says Greece Will Never Repay Debt, Says Bailout All About "Rescuing Banks And Rich Greeks"
Yesterday, the copper spot price fell below its 200-day moving average. We don’t like to give the charts much attention, but this is one of those breakdowns of support that gets a lot of people excited. At barely $3 today, it’s also 60 cents off its year-to-date high. Agora Financial
In other words, copper just slipped into a bear market. If his Ph.D. still carries any clout, the world might follow suit.