The Plain Truth

Is Gasoline Going to $5 A Gallon This Summer?

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The former CEO of Shell Oil USA says there is a “better than 50 percent chance” gasoline prices will hit $5 a gallon by sometime this summer.

John Hofmeister, founder of an advocacy group called Citizens for Affordable Energy,” says even though demand for gasoline is weak in the U.S., global demand for oil will keep driving the price of gasoline higher.

“What’s really unprecedented is developing countries, particularly China and India, have this insatiable need for more oil and that has not been taken into account when we think of public policy in this country,” Hofmeister said in an interview with CNBC.  Read the Story>>>>>>>>

'Dr Doom' - economist who predicted financial meltdown of 2008 - now warns Iran conflict 'could spiral economy into global recession'

Economist Nouriel Roubini, nicknamed 'Dr. Doom' for his gloomy predictions in the run-up to the financial meltdown four years ago, says the fallout from that crisis could last the rest of this decade.

Dr Roubini, widely acknowledged to have predicted the crash of 2008, sees tough times ahead for the global economy and is warning that without major policy changes things can still get much worse.

He said the biggest uncertainty is the possibility of a conflict with Iran over its nuclear program that involves Israel, the United States, or both.

Read more: http://www.dailymail.co.uk/news/article-2093165/Dr-Doom--economist-predicted-financial-meltdown-2008--warns-Iran-conflict-spiral-economy-global-recession.html#ixzz1koraIYGo

Total UK Debt To GDP Ratio Exceeds 900%. Japan Is Over 600% And Europe Is Almost 500% Debt to GDP, The U.S. Is Over 300%

Although there were those who campaigned by kissing babies and promising to represent us, the majority have long since sold us out, abandoned fidelity to the Constitution and loyalty to the People by becoming prostitutes to the highest bidders in Washington. Unfortunately, the worst part of these psychopathic whores is that they are suicidal, driving the car and we happen to be along for the ride.

Case in point: the vast majority of the American People do not want European or any other kind of socialism. So what do our so-called Representatives shove down our throats? Socialism, socialism and more socialism. Is that because the Rothschild, Rockefeller and other banking elite families want to impose socialism as a common denominator by which to merge the Nation States of the world into a global tyranny? Probably, you can do the math.  Read the rest>>>>>>>

Everything The Government Is Unofficially Funding This Year

There are two lists. This first one looks at the spending for which the necessary enabling legislation has already expired:

This one is for those expenditures whose authorizations expire on or before September 30 of this year:

Read more: http://www.businessinsider.com/congressional-stop-gap-legislation-2012-1-18#ixzz1koubrOx1

Economy Grows at 2.8% Clip, But Slowdown Likely Ahead

The U.S. economy grew at its fastest pace in 1-1/2 years in the fourth quarter, but a strong rebuilding of stocks by businesses and weak spending on capital goods hinted at slower growth in early 2012.

 

U.S. gross domestic product expanded at a 2.8 percent annual rate, the Commerce Department said on Friday, a sharp acceleration from the 1.8 percent clip of the prior three months and the quickest pace since the second quarter of 2010.

It was, however, a touch below economists expectations for a 3.0 percent rate.

"The economy ended 2011 on a fairly positive note, but the composition of growth in the last quarter is not favorable for growth early this year," said Ryan Sweet, a senior economist at Moody's Analytics in West Chester, Pennsylvania.

Read the rest>>>>>

The Worst Economic Recovery Since The Great Depression

 

The record of President Obama’s first three years in office is in, and nothing that happens now can go back and change that.  What that record shows is that President Obama, with his throwback, old-fashioned, 1970s Keynesian economics, has put America through the worst recovery from a recession since the Great Depression.

 

The recession started in December, 2007.  Go to the website of the National Bureau of Economic Research (www.nber.org) to see the complete history of America’s recessions.  What that history reveals is that before this last recession, since the Great Depression recessions in America have lasted an average of 10 months, with the longest previously lasting 16 months.  MORE>>>>>>

Gas prices rise for first time since October... and this is likely just the beginning

The average price for a gallon of gasoline in the United States increased for the first time since mid-October, rising by 12 cents to about $3.36 over the last three weeks due to higher crude oil prices, an industry analyst said on Sunday. The closure of three oil refineries on the east coast, coupled with a fear of another Arab Spring in the Middle East is likely to push oil prices even higher, Tom Kloza, chief oil analyst for the Oil Price Information Service, told the Los Angeles Times. 

Read more: http://www.dailymail.co.uk/news/article-2083927/Gas-prices-rise-time-October--likely-just-beginning.html#ixzz1ixpr68xx

 

Guest Post: Inflation: An Expansion of Counterfeit Credit

Submitted by Keith Weiner

Inflation: An Expansion of Counterfeit Credit

consumer prices are a red herring. Increased production efficiency tends to push prices down, and monetary debasement tends to push prices up. If those forces balance in any given year, the monetary authorities claim that there is no inflation........This is a lie.........  Inflation is not rising consumer prices. One can’t understand much about the monetary system from inside this box. I offer a different definition.

Inflation is an expansion of counterfeit credit.   MORE>>>>>>>>>>>>

The spectre of 1932

How a loss of faith in politicians and democracy could make 2012 the most frightening year in living memory

By Dominic Sandbrook

The dawn of a new year is usually a time of hope and ambition, of dreams for the future and thoughts of a better life. But it is a long time since many of us looked forward to the new year with such anxiety, even dread.

Here in Britain, many economists believe that by the end of 2012 we could well have slipped into a second devastating recession. The Coalition remains delicately poised; it would take only one or two resignations to provoke a wider schism and a general election.

But the real dangers lie overseas. In the Middle East, the excitement of the Arab Spring has long since curdled into sectarian tension and fears of Islamic fundamentalism. And with so many of the world’s oil supplies concentrated in the Persian Gulf, British families will be keeping an anxious eye on events in the Arab world.

Read more: http://www.dailymail.co.uk/news/article-2080534/Loss-faith-democracy-make-2012-frightening-year-ever.html#ixzz1iGtPjLtU

5 Things Your Business Needs To Do on Facebook

Lisa Anteau, Web.com - Jul 2011

At this point, it’s fair to assume that most people are familiar with Facebook. While a few years ago, questions about the social networking giant were personal in nature, they’ve since become business oriented. Whether large or small, more and more businesses are asking themselves, “How should I be using Facebook for my business?” Recent revelations by digital marketing analyst comScore, Inc. that Facebook accounted for nearly one-third of online display advertising in the U.S. makes it abundantly clear that Facebook is here to stay.

If becoming a social media marketer makes you wonder where to begin, here are 5 things you should do on Facebook for your company:

Why free-market economics is a fraud

© 2011 WND

If there's one thing everyone in America knows, it's that free-market economics is true and free markets are best.

After all, we're not communists, are we? They starved and lost the Cold War because they believed otherwise. And their watered-down European cousins the socialists? More of the same, only less so. Even liberals get this nowadays. All hail the free market!

Trouble is, things "everyone" knows are often wrong. And this is no exception.

It's time to start getting honest about a very simple fact: Nobody, but nobody, really believes in free markets. That's right. Not the Republican Party, not the libertarians, not the "Wall Street Journal," nobody.

Here's why: a truly free market is a perfectly competitive market. Which means that whatever you have to sell in that market, so does your competition. Which means price war. Which means your price gets driven down. Which means little or no profit for you.

Oops!

Naturally, businesses flee perfectly competitive markets like the plague. In fact, the fine art of doing so is a big part of what they teach in business schools.

That's why businesses use strategies like product differentiation, so their competition is no longer selling the exact same product they are. That's why they use strategies like branding, so their buyers don't think the products are the same.

Businesses will, in fact, do almost anything to get out of the hell of pure head-to-head competition.

They don't do it because they're crooked; they do it because they have an intrinsic economic incentive to. Always.

This is part of the innate essence of capitalism. It is not a flaw or a defect. It is part of what makes the whole system go. It is part of what makes capitalism capitalism.

People are the same way. Consider your own career. Why do you get paid more than the minimum wage? (I'm hoping you do.) Probably because you have some skill that everybody else doesn't have. So you don't have to bid against every unemployed person in your area to hold your job. Just a few of them. Which pushes your wage above the legal minimum.

That skill of yours is what economists call a "barrier to entry" – entry into the market for your job, that is. And if you're anything other than a damn fool, you'll cherish it like your very life.

I sure do.

Now let's consider the other side of the equation. We've looked at free markets in things you sell. Now let's consider free markets in things you buy.

Here everything gets turned around. If I'm buying something, I want the freest possible market in that product.

I don't, to take an example recently on my mind, want there to be only one market for live Christmas trees in my town. I want there to be two (or more), and right next to each other so I can easily comparison shop. And I want to shop for more-easily shippable goods on the Internet, if possible, where I can potentially find the lowest price in the entire world.

I want, in other words, every seller's nightmare. Which every smart seller will use every legal trick in the book to avoid.

As a result, nobody with any wits about them really believes in free markets. People believe in them when it's in their interest, but not when it's the other way around.

This is a systemic, structural condition, so anyone who tells you they believe in "free markets" is either lying, stupid, or hasn't thought the whole concept through properly.

The latter category is quite common. Many people do their thinking about political ideology in an entirely different – and dreamily disconnected – mental space than they use for managing real life.

Frankly, everyone I've ever met gets the truth well enough in practice, in their own personal life or in how they run their business, so I just don't believe anymore that anyone does believe in free markets.

Like any rational person, I'm open to counter-examples if anyone can show me any. But I've been asking around for a while on this, and haven't come up with much.

This is not just an esoteric point, still less yet one more example of the familiar fact that people are hypocrites in politics.

Here's why it matters. The political players in America today who claim to support free markets don't. They support free markets in the things their backers buy, but maximum barriers to entry in the things their backers sell.

For example, one of the great unnoticed achievements of the Republicans (and their Democrat collaborators) from Reagan onward has been to gut U.S. antitrust law. Having a monopoly, or a cozy oligopoly with friendly rivals, is one of the best barriers to entry around.

As recently documented in Barry Lynn's fine book "Cornered: the New Monopoly Capitalism and the Economics of Destruction," American industry is now concentrated as it hasn't been since before the era of Teddy Roosevelt and his trustbusters. (There's a different kind of Republican for you, by the way. These truths are not liberal or conservative.)

Most Americans don't realize this has happened because, unlike in the old days of Standard Oil, oligopolies today are cunning about masking their existence.

To take just one example, America's eyeglass frame industry is now dominated by the conglomerate Luxottica. That's why frames are so expensive. And any company, like Oakley the sunglass maker, that tries to break into the market? They find themselves shut out of a Luxottica-controlled distribution system. And retailers are now afraid to receive distribution from anyone else, lest they be cut off.

It's a remarkably well-oiled scheme, and it has its parallels in many other industries. But the average consumer has no idea about this, because the range of brands, if not suppliers, in optical shops remains diverse.

We're fat, dumb and happy. We've been fooled. But behind the smiling mask of a hundred labels smirks a single monopolist.

But aren't there laws against this sort of thing?

Well, there sure used to be, enforced by unsung lawyers and bureaucrats (horrors!) at the Justice and Commerce Departments. Whom nobody considered very glamorous, but who were doing the rest of us a big favor. Talk about forgotten wisdom!

Consider some other examples:

• Tyson in chicken
• Smithfield in ham
• Menu Foods in pet food
• Frito-Lay in chips
• InBev and MillerCoors in beer
• PepsiCo, Coca-Cola, and Nestlé in bottled water
• Dickinson in medical devices
• Microsoft in operating systems
• Iron ore (three companies)
• Aluminum
• Cement
• Railroads
• Banking

The number of problems caused by letting monopoly power – whose key consequence is known as "pricing power" – is astonishing.

For one thing, this is a huge part of what ails American farmers. Family farmers are caught between the agribusiness monopolies who push up the price of their inputs (feed, seed, fertilizer etc.) and the agribusiness monopolies who push down the price of their outputs. (The economists' term for the latter is "monopsony," with an "s," but it works the same way as monopoly.)

It's the perfect racket.

And it's no surprise that on the other side of the equation, "free" market politicians are very diligent in imposing genuinely free markets where this suits the interests of the multinational "American" corporations that fatten their campaign coffers.

This is done, of course, as a matter of high principle and sophisticated economic rationality. It's remarkably easy to make wonderful after-dinner speeches about free markets.

Let's start with labor. Post-Nixon Republicans have genuinely supported just about every policy designed to weaken the pricing power of labor. This starts with weakening unions and letting the inflation-adjusted minimum wage fall, but it doesn't end there.

You think Ronald Reagan got in 1986, and George W. Bush wanted in 2007, amnesties for illegal immigrants because they were nice, compassionate people? To ask the question is to answer it. Whatever the ultimate merits of amnesty as policy, for them it was about cheap labor, plain and simple.

The reality is that the past prosperity of America has never been based on pure free markets – starting with the fact that we had the highest average income in the world in 1776 because the colonies had structurally tight labor markets due to the open frontier. (Europeans and other Old World peoples were trapped by the iron law of wages because they had nowhere to go.)

Free, or nearly free, markets do have their rightful place in many parts of the economy, and it would be foolish to sabotage them. But in other areas – above all, in labor markets – our prosperity was based on pricing power.

A number of areas other than labor also worked better thanks to a healthy dose of pricing power. Try advanced technology, for a start. The patent system, which is not natural, is a fairly recent invention, and does not de facto exist even today in much of the world, is one. Innovation doesn't come cheap, and without pricing power for innovators, few companies could afford it.

Even the existence of scale economies, which are intrinsic to modern, large-scale, capital-intensive industry, implies markets that are less than free. Why? Because scale economies intrinsically imply a small number of large producers and thus give rise to oligopoly, with the consequences mentioned earlier.

This is why most other industrialized nations aren't romantics about free markets, are honest about their frequent nonexistence, and focus their policies on taming the negative effects of oligopoly while capturing the positive ones. They understand, for one thing, that big corporations are necessary but often pirates, and focus on making them share their loot with their crews.

We, on the other hand, live in a state of denial about the piracy.

So the next time someone tells you to believe in "free" markets, just tell them you'll believe as soon as they do.

When pigs fly.

We've Defaulted Before | THE PLAIN TRUTH by Judge Napolitano

If The Market Crashes, Who Owns Enough Stock To Even Care?

Since 81% of all stocks are owned by the top 10%, a stock market crash has little effect on the bottom 90% of Americans

Charles Hugh Smith
Business Insider

It is assumed without question that the stock market is some quasi-sacrosanct barometer of the U.S. economy. But who even cares if the market crashes? Only the top 10% who own it. Yes, millions of (generally government) workers have an indirect stake in stocks and bonds via their state/union pension funds, but it's still informative to look at the distribution of who actually has a stake in the market's rise and fall.

This data is from pre-recession 2007, so I suspect ownership has become even more skewed to the top 5% as those below liquidated stocks to pay the bills as household income and housing equity plummeted.

Read Full Article

What QE3 Will Look Like

Dees Illustration

Robert Bonomo, Contributing Writer
Activist Post

The recent financial fireworks in the US and in Europe have made it clear that QE3 is close at hand. The third installment described herein is much more than just another revving up of the printing presses, as it will involve a paradigm shift intent on restoring currencies and maintaining the current power structure.

It's an all too common mistake to see the central bankers and their mainstream media propagandists derided as incompetent fools. These “fools”control the money and the message and it's their game to lose. Most pundits think the powers that be have lost control and can do little more than kick the can down the road. They are wrong. We are about to witness one of the greatest orchestrated events in human history; a monumental slight of hand that will restore economic prosperity, keep the masses happy and, most importantly, maintain the parasitic elites in power.

Read more »

Is The World Going Bankrupt?

Europe and the US are hopelessly over-indebted. The crisis that started in the US real estate sector in 2007 has devastated state finances on both sides of the Atlantic and is threatening to wreck the euro and trigger a second global downturn. The world lacks the political leadership needed to end the turmoil. By SPIEGEL Staff more...

 

also:

US Economist Kenneth Rogoff

'Some European Countries Are Fundamentally Bankrupt'

Market Crashes!! It's UGLY! Dow Sinks 500, Worst Day Since Dec. 2008

 

Stocks plunged sharply Thursday, with the Dow down more than 500 points, in its worst one-day drop since December 2008.

All three major averages tumbled into negative territory for the year as investors were rattled over an intensifying global economic slowdown and ahead of the widely-followed monthly unemployment report.

 

Major U.S. Indexes

.DJIA

11383.68

-512.76

-4.31%

.NCOMP

2556.39

-136.68

-5.08%

0

.SPX

1200.07

-60.27

-4.78%

0

The Dow Jones Industrial Average plummeted more than 450 points, led by Alcoa [AA  12.94    -1.32  (-9.26%)   ] and BofA [BAC  8.83    -0.71  (-7.44%)   ]. The blue-chip index fell into "correction territory," defined by a drop of 10 percent from its peak from its intraday high in May. The last time the Dow dropped more than 400 points in a single session was in Dec. 2008.

The S&P 500 and Nasdaq also dipped into correction mode. And all three major indices are firmly in negative territory for the year.

The CBOE Volatility Index, widely considered the best gauge of fear in the market, surged more than 30 percent to trade near 32.

Volume was at its highest level this year with the consolidated tape of the NYSE at 7.15 billion shares, while 1.82 billion shares changed hands on the floor.

 

DOW PLUMMETS 512...

 
GAINS FOR YEAR GONE...

 
'CORRECTION'...

GLOBAL SELL-OFF ACCELERATES...

Worst Day Since Dec. 2008...

'NOT SINCE JIMMY CARTER'...

10 Proposals to Get America's Economy Back on Track

Dees Illustration

Brandon Turbeville
Activist Post

In the three years since the passage of the TARP legislation, Bank Bailouts have become a sore subject for most voters, regardless of which side of the aisle they see themselves as being on. With time proving their concerns to be legitimate, the fact is that with the exception of academics and those actually benefiting from the bailout, virtually no one supported it to begin with. Now, in 2011, even your average Republican or Democrat agrees that the bailout was at best a bad decision, albeit for different reasons.

Yet the Democrats and Republicans in Congress, regardless of their rhetoric, have shown no interest in doing anything truly meaningful about it. Indeed, there are no real solutions coming from Congress that wouldn’t make an already bad situation worse.

Three years after the bailouts, which were overseen and implemented by both Bush and Obama, the United States is in no better shape than it was in 2008. In fact, it is much worse.

Read more »

Armadebton: The Case For Hitting the Debt Reset Button

Reset the debt clock to zero AFP File image

Eric Blair
Activist Post

Donald Trump tells a story about the Savings and Loan crash in the late 1980s.  He was complaining to his young daughter at the time about how devastating the real estate plunge was for them. She didn't understand why he was crying poor when they lived such a lavish lifestyle. The Donald pointed to a bum on the park bench and said, "You see that guy over there? He is billions of dollars wealthier than we are."

He was referring to the debt he owed to banks. On paper he was worse than broke, so he was actually poor compared to the penniless squatter in the park. But, in reality, he was still fabulously wealthy, as the debt was just an arbitrary number, and he still slept in a penthouse within a building he owned, not a park bench. And, of course, the banks had to work with Trump because he was too big to let fail.

Read more »

How Big is the U.S. Debt?

Manufacturing growth hits lowest level in 2 years

Source: AP

Manufacturing activity barely grew in July, falling to the weakest level since just after the recession ended, a private trade group said Monday.

The Institute for Supply Management, a trade group of purchasing executives, said its index of manufacturing activity fell to 50.9 percent in July from 55.3 percent in June. It was the 23 straight month of growth. But the reading was the lowest reading since July 2009 — one month after the recession officially ended. Any level above 50 indicates growth.

Read Full Article Here

Soaring demand spotlights secret NY gold hoard

Source: AFP

If there's one place a James Bond villain -- or even some actual governments -- would love raiding today, it's the basement of a somber building in lower Manhattan: the world's biggest gold vault.

Gold prices hit a record $1,632.8 an ounce Friday, reflecting a nervous rush by private and national investors from stocks, dollars and euros to the safe-haven commodity.    Read Full Article Here

Senator supports online sales tax reform

Cash-strapped states seeking to collect billions in taxes from online transactions gained an ally in Washington on Friday when a senator introduced a bill for a federal solution to the problem.

Struggling with weak economies, states will lose an estimated $10 billion this year and $11.4 billion next year in sales taxes that go uncollected on online purchases, according to studies by three professors at the University of Tennessee.

Although the fate of the bill by Democratic Senator Dick Durbin was uncertain given the anti-tax environment on Capitol Hill, his measure is backed by the National Governors Association and the National Retail Federation and even earned a pledge of cooperation from giant online retailer Amazon.  MORE>>>

How corporations avoid paying income taxes

With all the talk about how companies like General Electric and Cisco pay no or very low U.S. taxes, reader Hal Helfan of Oakland wants to know why can't there be an alternative minimum tax for corporations like there is for individuals, to make sure that companies can't use loopholes to wipe out their tax burden.

"If the AMT rate were set appropriately, it would probably be easier to lower the corporate tax rate and would definitely be a boon to small corporations that don't get much benefit from tax credits," he writes.

In fact there is a corporate AMT, and it works very much like the individual AMT.

Corporations figure their tax under the regular system, which taxes corporate profits at a top rate of 35 percent. Then they figure it under the AMT system, which tosses out some deductions allowed under the regular system, and taxes the resulting profit at 20 percent. The corporation then pays whichever tax is higher.

Many large corporations are subject to AMT, especially capital-intensive companies that lose depreciation and other deductions under AMT.

But there are two problems with the AMT. Although it's extremely complex to comply with, it's not all that tough.

"It's more than anything a nuisance revenue raiser," says Martin Sullivan, a contributing editor to Tax Analysts.

More important, it does not apply to the profits that U.S. companies earn or purport to earn abroad. U.S. multinationals have found myriad ways to shift profits to foreign tax havens.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/04/20/BUVT1J4F2U.DTL#ixzz1KDHRAjB5

We're All Greeks Now

By Patrick J. Buchanan

Departing for New Hampshire in November 2010, Sen. Judd Gregg, the fiscal conservative President Obama wanted in his Cabinet, blurted an inconvenient truth: “This nation is on a course where if we don’t do something about it, get … fiscal policy (under control), we’re Greece.”

The remark was regarded as hyperbole. But Gregg had a point. For though Greece, measured by the size of her economy, is only 2 to 3 percent of the EU or the U.S. economy, she is a microcosm of the West.

Read more...

Complete History Of U.S. Debt Defaults

Source: Market Oracle

John S. Chamberlain writes: On July 13th, the president of the United States angrily walked out of ongoing negotiations over the raising of the debt ceiling from its legislated maximum of $14.294 trillion dollars. This prompted a new round of speculation over whether the United States might default on its financial obligations. In these circumstances, it is useful to recall the previous instances in which this has occurred and the effects of those defaults. By studying the defaults of the past, we can gain insights into what future defaults might portend.