He played the role with cool-headed decorum, but that raises the question: was he just playing a role? From the get-go, he made himself hostage to some of the most sinister puppeteers of the Deep State: Robert Rubin, Larry Summers, and Tim Geithner on the money side, and the Beltway Neocon war party infestation on the foreign affairs side. I’m convinced that the top dogs of both these gangs worked Obama over woodshed-style sometime after the 2008 election and told him to stick with the program, or else.
“Larry is a true free-market capitalist — and for that I strongly admire his work,” said David A. Stockman, who was director of the Office of Management and Budget under Reagan. “But he’s also an incorrigible bull after having spent so many years sniffing financial bubble glue at CNBC.” Wall Street “bulls” are more optimistic than pessimistic “bears.”……Yet Stockman notes that “35 years later, the U.S. economy is fatally hobbled with $64 trillion of public and private debt. It needs fiscal and financial discipline, not supply-side nostrums.” But, he said, pointing to Kudlow’s claims, “Larry still doesn’t know he was wrong the first time.”
Barack Obama isn’t known for humility, though rarely has his lack of grace been more on display than in his final hours in office. The nation rejected his agenda. The president’s response? To shove more of that agenda down the nation’s gullet. Notice the growing and many ugly ways the Obama administration is actively working to undermine a Donald Trump presidency. Unnamed administration sources whisper stories about Russian hackers to delegitimize Mr. Trump’s election. These whispers began at about the same time Hillary Clinton officials began pressuring electors to defy election results and deny Mr. Trump the presidency. How helpful.
When it comes to propping up the stock market in the US, the Federal Reserve does so with a certain degree of nuance, keeping at least one layer of disintermediation between itself and the market, which usually involves “advising” Citadel to intervene when it comes to acute moments of market stress, granting the HFT-heavy hedge fund a green light to stop and reverse and violent selloffs, or more traditionally, allowing companies to repurchase their own stock thanks to (until recently) record low interest rates. This is nothing new: as Goldman has repeatedly pointed out, in 2016 corporations have been the largest source of equity demand, purchasing $450 billion of US equity through buybacks and cash M&A (net of share issuance). Outside of the Great Recession, corporates have been the primary source of US equity demand (see Exhibit 1)……Did we say “less stealthy?” We meant the central bank is now intervening directly in the stock market with all the finesse of a stock bull in a china store (just not Chinese china, it’s a patriotic thing), and according to a report by the Nikkei, the Bank of Japan is set to become the biggest buyer of ETFs in 2016 for the second straight year, in the process masking a srecent surge in foreign investor selling.
One thing stands out even on first reading: when this future US ambassador says “we”, he means “we Israelis”. “we true Israelis”, “we Israeli patriots”. The territory of Greater Israel, from the Mediterranean Sea to the Jordan river (at least) is “our country”. Friedman does not identify with all Israelis. He seems to think that most of us are blind, imbeciles, defeatists. or worse – traitors. This would set a world record: most Israelis, it appears, are traitors. So who does Friedman really identify with? A representative sample of his utterances make this quite clear: he considers himself to belong to about 5% of the Israeli population: the settlers and the extreme Right.
To atone for all the alleged unfairness of “capitalist society” he promised explosive growth of welfare statism, complete with “free” education, free health care, free housing, and a virtual “economic bill of rights” filled with free everything. Good old fashioned socialism, in other words. Or, government-as-Santa-Claus. I speak of course of Hugo Chavez, the late democratic socialist ruler of Venezuela and his handpicked successor, former bus driver Nicolas Maduro. Together, these two men managed to completely destroy their nation’s economy with a mere fifteen years of democratic socialism.
Relations between Russian president Vladimir Putin and US president Barack Obama are poisoned and irretrievably damaged. It’s therefore a good thing that Obama is leaving office on 20 January. Bad US-Russian relations are of course nothing new. Since the Anglo-American war against Iraq in 2003, the US-Russian relationship has been headed downhill. For Obama, it appears that everything has gotten personal. The US president often acts like a petulant adolescent, jealous of a high school rival. You know, the kid who does everything better than he does. The lad takes it badly and won’t let it go. He challenges his nemesis to some new contest at every opportunity only to lose again and again. That’s got to be hard on the ego. Between Obama and Putin there have been many such encounters. Nor can it help that western cartoonists so often ridicule Obama as out of his depth in comparison to Putin.
Monte dei Paschi’s rescue is a bailout masquerading as a bail-in. European rules now mean governments that save banks have to force losses on creditors, or convert them into shares. Italy is doing that with MPS, but adding an unjustified bit of financial engineering that makes it no better than bank bailouts from 2008…..Yet the government is bolting on another leg. The bank can then swap those shares held by retail investors for a new bond, this time a senior-ranking one, with little default risk. That would create a problem for MPS, as it would have less equity. So, the government will then buy those shares from the bank. Economically, it looks similar to the government simply buying the shares directly from retail creditors.
Sounds impressive, unless you look closely at the numbers. First, about the 15 million new jobs added since Obama signed Obamacare into law. The black box in the chart below shows the real average hourly wages since 2010 (through 2014). They were declining……And, of course, my least favorite labor market chart: Average hourly earnings of production and nonsupervisory employees YoY (about 82% of the US population). The WORST wage recovery from a recession since President Lyndon B. Johnson.
It sounded like the intro to a bleat from some liberal professor or journalist. Not so. The writer was former President Harry S. Truman, who spearheaded the establishment of the CIA 66 years ago, right after World War II, to better coordinate U.S. intelligence gathering. But the spy agency had lurched off in what Truman thought were troubling directions….Sadly, those concerns that Truman expressed in that op-ed — that he had inadvertently helped create a Frankenstein monster — are as valid today as they were 50 years ago, if not more so.