Monthly Archives: April 2012
For First Time since Depression, More Mexicans Leave U.S. than Enter
By Tara Bahrampour, Published: April 23
A four-decade tidal wave of Mexican immigration to the United States has receded, causing a historic shift in migration patterns as more Mexicans appear to be leaving the United States for Mexico than the other way around, according to a report from the Pew Hispanic Center.
It looks to be the first reversal in the trend since the Depression, and experts say that a declining Mexican birthrate and other factors may make it permanent.
“I think the massive boom in Mexican immigration is over and I don’t think it will ever return to the numbers we saw in the 1990s and 2000s,” said Douglas Massey, a professor of sociology and public affairs at Princeton University and co-director of the Mexican Migration Project, which has been gathering data on the subject for 30 years.
Nearly 1.4 million Mexicans moved from the United States to Mexico between 2005 and 2010, double the number who did so a decade earlier. The number of Mexicans who moved to the United States during that period fell to less than half of the 3 million who came between 1995 and 2000.
The trend could have major political consequences, underscoring the delicate dance by the Republican and Democratic parties as they struggle with immigration policies and court the increasingly important Latino vote.
Read the rest here.
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Soros Compares Euro-Zone Crisis to Soviet Collapse
The question is, on what is Soros betting to make him rich-er once he achieves his much sought-after Euro collapse? Answer that, and you too might be rich-er.
Comments »Taibbi: Jon Corzine Is the Original George Zimmerman
PBS Frontline Investigation Into Financial Crisis Suggests Another Disaster On Horizon
“Frontline’s new documentary about the financial crisis probably doesn’t say much you didn’t already know, at least if you’ve followed the story. But it’s a story worth telling again anyway, because memories on Wall Street and in Washington are dangerously short.
On Tuesday night PBS will air the first two parts of afour-part documentary on the crisis, called “Money, Power and Wall Street,” with the second two parts to air next Tuesday, May 1.
The first hour tells the history of the credit derivatives at the heart of the crisis, while the second hour tells the blow-by-blow of the crisis itself, culminating with the bank bailouts in the fall of 2008.
Viewers familiar with all of this material — and there’s not much new in the first two hours, which could probably have been condensed to one hour without losing much — might be confused about the point of rehashing what is by now old history. The trailer for the whole series suggests Frontline is slowly building a case, maybe to be hammered home in the final two hours next week, that the financial system is still just as primed for disaster as it was four years ago.
The second part of the documentary, airing in the second hour tonight, is more entertaining than the first, but mainly in the way oft-told horror stories are fun to hear around the campfire. Stop me if you’ve heard any of this before: Bear Stearns goes down because of toxic mortgage debt early in 2008. Policy makers take the summer off. Treasury Secretary Hank Paulson decides to let Lehman Brothers die, to teach Wall Street a lesson. Oops! AIG and the rest of Wall Street get hundreds of billions of dollars to keep the financial system from going down the drain…”
Comments »America’s Secret Growth Weapon: Why Immigration Really, Really Matters
U.S. Lost AAA Rating on Danger of Liquidity Crisis, S&P’s Kraemer Says
“The U.S. lost its top credit grade in August because of the imminent danger of a “real liquidity crisis,” and Standard & Poor’s made no errors in its analysis, said Moritz Kraemer, managing director of sovereign ratings.
“Last summer, the U.S. government got extremely close to a real liquidity crisis because the Washington establishment could not agree on the way forward that would have been required to raise the debt ceiling,” Kraemer told lawmakers on the U.K. Parliament’s Treasury Committee today in London.
S&P cut the rating by one level to AA+ on Aug. 5, criticizing the nation’s political process and saying that spending cuts agreed on by lawmakers wouldn’t be enough to reduce record deficits. Treasuries surged after the move, and while Moody’s Investors Service and Fitch Ratings have kept their top grades on the U.S., both have a negative outlook. The U.S. Treasury criticized S&P for flawed analysis.
“There was no mistake,” Kraemer said today. “There were different scenarios. These are measures about the future which you have to have an analytical debate on what is the likely strategy of fiscal consolidation the government might take.”
S&P made a $2 trillion error and then changed the rationale for its decision, raising “fundamental questions about the credibility and integrity” of its ratings action, John Bellows, acting assistant secretary for economic policy, wrote in a Treasury blog post on Aug. 6.
Kraemer dismissed that analysis, echoing comments at the time by David Beers, S&P’s former head of sovereign ratings, who said it was a “complete misrepresentation” of what happened. Kraemer’s testimony today was part of an inquiry by lawmakers into credit rating companies.
CBO Scenarios
The discussion with the Treasury before the downgrade was announced “was about which of the scenarios which were published by the Congressional Budget Office, which is a nonpartisan institution, should be underlying the analysis,” Kraemer said. “Originally the S&P team was following the alternative scenario of the CBO, the alternative fiscal scenario, which in terms of expenditure trajectory did foresee a growth in spending in line broadly with nominal GDP.”
S&P agreed to use a different scenario after a “normal process of interaction” with Treasury officials, Kraemer said.
“The 2 trillion is the difference in the net debt ratio in 2021 depending on which scenario you use,” he said. “Under the alternative scenario, which we had initially pursued, the debt ratio in 2021 would have come up at $22 trillion — I’m using round numbers — 22.1, which is 2 trillion higher than under the baseline scenario, which is 20 trillion.”
$2 Trillion
In August S&P said it went ahead with a downgrade because the Treasury’s $2 trillion figure was derived by calculating government debt over a 10-year period while S&P’s ratings are determined using a three- to five-year time horizon.
Questioned today on why Finland is graded AAA while the U.S. has lost its top rating, Kraemer highlighted the differences in both nations’ political environment.
“The debt ratio in the U.S. is much higher, the debt trajectory is more adverse, but most importantly, it has been our finding at least, people may come to different conclusions on that, but we felt the governance challenges that the U.S. political system is facing in generating a coherent strategy of getting the public finance challenge under control are more pronounced than they are in Finland,” Kraemer said.”
Comments »Watch Mohamed El-Erian Comment on Tomorrow’s Fed Policy Meeting
ComScore: Travel and Lotto Sites Receive the Lions Share of Internet Traffic
“ComScore today released its analysis of this month’s top properties on ye olde Webernets in the U.S. There are a number of points of interest, but among them, it seems that lotto sites were the top beneficiary of U.S. Internet traffic. This was largely a result of the unprecedented Mega Millions jackpot, which became the largest jackpot in U.S. and world history, reaching $656 million in March. Lotto sites drew nearly 29 million visitors (with MegaMillions.com grabbing the top spot), up 25 percent from February, making it the biggest mover in March.
Travel info sites were the next biggest beneficiary of traffic, according to comScore, as Americans looked to book last-minute spring break trips and summer travel. This made travel one of the top-gainers, up 10 percent to 69.7 million visitors in March. Of the web’s growing number of travel properties, TripAdvisor saw the biggest boost, up 5 percent from the prior month, to a total of 18.1 million visitors. TripAdvisor was followed by Travora (which today acquired NileGuide) at 15.5 million visitors (also up 5 percent), and Yahoo! Travel was up 9 percent with 11.1 million visitors in March.
Biderman: “Europe is in big trouble, and the trouble is getting worse – much worse”
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“Europe is in big trouble, and the trouble is getting worse – much worse” is how Charles Biderman begins his latest missive. The diatribe focuses on the shortcomings of both the left (the existing political structure of government-dominated economies) and the right (a German-style austerity program of slashing spending and raising taxes) of inane politicians in Europe as the two main issues of over-spending and declining economic activity come home to roost. Starting from the Euro’s inception and its implicit permission to allow each country to borrow as much as they want without regard to what was going on in their local economy is just as pernicious as the cradle-to-grave welfare state that is the prevailing mantra “everyone deserves to be taken care of”. Therein lies the crux of the matter as borrowing (excessively) to support the people’s supposed ‘deserved’ welfare is viewed as ‘just-and-fair’ whereas in reality, simply put, “the economies of most of Europe do not work.” The Bay-Area bad-boy does offer reasoned solutions that offer hope for growth as opposed to just austerity for the sake of it as, among other things, he suggests eliminating red-tape to create a more entrepreneurial environment but ultimately he sees the probability of this as low and suggests being short via EUO (the double-levered Euro short) and EMZ (short non-USD developed – mostly Europe – markets).”
Comments »Chinese Scientists Clone a Sheep With a “Good” Fat Found in Nuts, Seeds, Fish, and Leafy Vegetables
Cloning and gene manipulation is cool. Perhaps they could make a cocaine steak for Wall St so as to avoid illegal activities. Or how about Viagra Shrimp Cocktail ?
Comments »Romney launches his campaign as presumptive nominee
“(Reuters) – Mitt Romney was to launch himself as the presumptive Republican presidential nominee after an expected sweep of five primaries on Tuesday, turning his attention to the November general election showdown with President Barack Obama.
In a speech in New Hampshire, Romney planned to pivot to the campaign against Obama and lay out his vision for the country and his differences with the incumbent.
“After 43 primaries and caucuses, many long days and not a few long nights, I can say with confidence, and gratitude, that you have given me a great honor and solemn responsibility,” Romney will say, according to excerpts released by his campaign.
“A better America begins tonight,” he said in the excerpts.
Obama and Romney already have engaged in heavy combat in recent weeks, which will likely increase in the six months of campaigning heading up to the November 6 election to decide whether to give Obama another four years in the White House.
Romney effectively won the Republican race on April 10 when his top rival, Rick Santorum, suspended his White House campaign, but he planned to claim victory in Tuesday’s speech in the general election battleground state of New Hampshire….”
Comments »Finding Bullish Evidence in a Bad Headline Case Shiller Price Index Report
“On the surface, today’s Case-Shiller was pretty meh.
House prices dropped nearly 3.5% year over year, and there was barely any sequential gain. In fact, the sequential gain was behind expectations.
But actually there are some big signs of a turnaround happening, and a continuation of a positive trend.
New Deal Democrat at The Bonddad Blog observes:
In today’s report, only 7 of the 20 metropolitan areas made new lows on a seasonally adjusted basis. Six of the 13 metro areas showing seasonally adjusted gains in this month’s report bounced off a low set just last month, so it could be noise. But once the price increases two or more months, there is more confidence that the corner has been turned.
Here is the number of cities that have already hit bottom in each monthly 20 city Case-Shiller report since last June:
June 2011 – 1
July 2011 – 2
Aug 2011 – 3
Sept 2011 – 3
Oct 2011 – 4
Nov 2011 – 6
Dec 2011 – 7
Jan 2012 – 13
Presumably some of the 6 cities that bounced off their January lows this month will resume their decline – but on the other hand, not all of them. In short, the trend the Case-Shiller index may have bottomed in January! Failing that, the trend is for it to make an overall bottom within a few months. I would venture by the end of summer.
What’s more, that sequential gain from January to February is the first one since last Spring.
The housing bottom may be close or here.”
Comments »One More Reason Healthcare Costs are Rising
Despite a landmark settlement that was expected to increase coverage for out-of-network care, the nation’s largest health insurers have been switching to a new payment method that in most cases significantly increases the cost to the patient.
The settlement, reached in 2009, followed New York State’s accusation that the companies manipulated data they used to price such care, shortchanging the nation’s patients by hundreds of millions of dollars.
The agreement required the companies to finance an objective database of doctors’ fees that patients and insurers nationally could rely on. Gov. Andrew M. Cuomo, then the attorney general, said it would increase reimbursements by as much as 28 percent.
It has not turned out that way. Though the settlement required the companies to underwrite the new database with $95 million, it did not obligate them to use it. So by the time the database was finally up and running last year, the same companies, across the country, were rapidly shifting to another calculation method, based on Medicare rates, that usually reduces reimbursement substantially.
“It’s deplorable,” said Chad Glaser, a sales manager for a seafood company near Buffalo, who learned that he was facing hundreds of dollars more in out-of-pocket costs for his son’s checkups with a specialist who had performed a lifesaving liver transplant. “I could get balance-billed hundreds of thousands of dollars, and I have no protection.”
Insurance companies defend the shift toward Medicare-based rates under the settlement, which allowed any clear, objective method of calculating reimbursement. They say that premiums would be even costlier if reimbursements were more generous, and that exorbitant doctors’ fees are largely to blame.
But few dispute that as the nation debates an overhaul aimed at insuring everybody, the new realpolitik of reimbursement is leaving millions of insured families more vulnerable to catastrophic medical bills, even though they are paying higher premiums, co-payments and deductibles.
“They’re not getting what they think they’re paying for,” said Benjamin M. Lawsky, the superintendent of the Department of Financial Services, whose investigators recently found that under the switch, 4.7 million New York State residents — 76 percent of those with out-of-network coverage — are facing reimbursement reductions of 50 percent or more.
The switch “certainly creates the appearance that insurers are trying to end-run the settlement and keep out-of-network payments low,” Mr. Lawsky said….”
Comments »Baidu Beats By a Penny But Gives Lower Guidance; Stock Gets Smashed in A.H.
Asia Set to Melt Up on Apple Earnings
“Japanese stock futures rose as better-than-estimated company earnings and signs the U.S. housing market is stabilizing boosted the outlook for Asian exporters.
American depositary receipts of Sony Corp., Japan’s No. 1 consumer-electronics exporter, gained 1.6 percent from the closing share price in Tokyo as a weaker yen also strengthened its earnings outlook. ADRs of Mitsubishi Corp. (8058), Japan’s largest commodities trader by revenue, rose 0.9 percent after prices of oil and metals advanced. Shares of Shimano Inc. may be active after the bicycle parts maker said quarterly profit more than tripled.
“In addition to a weakening yen, a recovery trend on earnings is being seen both in Japan and the U.S. at the moment, boosting markets,” said Hiroichi Nishi, an equities manager in Tokyo at SMBC Nikko Securities Inc. “The U.S. economy is still in mild recovery.”
Futures on Japan’s Nikkei 225 Stock Average expiring in June closed at 9,530 in Chicago yesterday, up from 9,480 in Osaka, Japan. They were bid in the pre-market at 9,550 in Osaka at 8:05 a.m. local time. Markets in Australia and New Zealand are closed for national holidays…”
Comments »The USDA Confirms Mad Cow Disease in CA; First Reported Case in 6 Years
“The first U.S. case of mad cow disease in six years has been found in a dairy cow in centralCalifornia, before it entered the human food chain and posed any threat to consumers, officials said.
The cow was identified as part of routine testing for the brain-wasting disease, known as bovine spongiform encephalopathy, John Clifford, the U.S. Department of Agriculture’s chief veterinarian, told reporters today at a briefing in Washington.
The animal arrived April 18 at a Baker Commodities Inc. facility in Hanford, California, where dead livestock are held before going to a rendering plant, Dennis Luckey, executive vice president of operations at Los Angeles-based Baker, said in a phone interview.
The carcass “was never presented for slaughter for human consumption, so at no time presented a risk to the food supply or human health,” Clifford said in a statement. Mad cow disease cannot be transmitted through milk from dairy animals, he said. “USDA remains confident in the health of the national herd and the safety of beef and dairy products.”
Cattle futures tumbled the most in 11 months in Chicago, and feeder-cattle prices fell by the exchange limit. The world’s largest beef producer, Brazil’s JBS SA (JBSS3), fell by as much as 5.2 percent before closing 0.3 percent lower in Sao Paulo. Tyson Foods Inc., the second-biggest U.S. beef processor, pared earlier gains to close 1.5 percent higher in New York.”
Comments »Apple, $AAPL, Earnings: Company Expects $8.50 on $32.5B in Revs, Analysts Expect $9.99 -$10.04 on $36.8B in Revs, Actual $12.30 on Revs of $39.2B
Norfolk Southern, $NSC, Posts $1.23 Per Share on Revs of $2.79 B
NASDAQ Gets Slappled While the DOW and S&P Rise
The markets did well today on good earnings reports. Apple was sold off ahead of earnings taking the NASDAQ with it.
DOW UP 75
S&P UP 5
NASDAQ DOWN 8.8
OIL UP $0.39
GOLD UP $9
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