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Senate Scheduled to Vote on Internet Sales Tax

“Attention online shoppers: The days of tax-free shopping on the Internet may soon end for many of you.

The Senate is scheduled to vote Monday on a bill that would empower states to collect sales taxes for purchases made over the Internet. The measure is expected to pass because it has already survived three procedural votes. But it faces opposition in the House, where some Republicans regard it as a tax increase. A broad coalition of retailers is lobbying in favor of it.

Under current law, states can only require retailers to collect sales taxes if the store has a physical presence in the state.

(Read MoreAre You a Tax Cheat If You Shop Online Tax-Free?)

That means big retailers with stores all over the country like Walmart, Best Buy and Target collect sales taxes when they sell goods over the Internet. But online retailers like eBay and Amazon don’t have to collect sales taxes, except in states where they have offices or distribution centers.

As a result, many online sales are tax-free, giving Internet retailers an advantage over brick-and-mortar stores.

The bill would empower states to require businesses to collect taxes for products they sell on the Internet, in catalogs and through radio and TV ads. Under the legislation, the sales taxes would be sent to the states where a shopper lives.

The measure pits brick-and-mortar stores against online services….”

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Uncle Sam’s Math

Never trust the headline number. Uncle Sam needs to go back to school and brush up on those math skills.

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Republicans Introduce a Bill to Go Dark

Many people complain that most economic data distributed by uncle Sam is doctored and tinkered with to produce a better outcome.

Well now  Republican Congressman would have no statistics released at all if his bill passes.

Being dubbed as insane; thankfully the bill is getting shot down.

Perhaps going dark is better than lying…..

“You can’t handle the truth”

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Japan Teams Up With Germany in Opposing Fed Liquidity Rule

Japan joined Germany in opposing a proposed U.S. Federal Reserve rule aimed at compelling large foreign bank holding companies to hold more capital and liquidity in their American subsidiaries.

Bank of Japan Executive Director Hiroki Tanaka asked the Fed Board of Governors in an April 30 letter to “carefully consider major concerns” it has about the proposed rule. Japan’s Financial Services Agency asked that the proposed rule take into account “deference to home country regulation and supervision” in a letter signed by Masamichi Kono, the regulator’s vice commissioner for international affairs.

The letters followed an April 26 note by Bundesbank Vice President Sabine Lautenschlaeger and Bafin President Elke Koenig to the Fed board that “‘go it alone’ national initiatives can tend to weaken the global setup and stability” of systemically important banks “instead of stabilizing them.”

The Fed’s proposal would affect Deutsche Bank AG, Germany’s biggest lender, which last year dropped its bank holding company status so that it could meet U.S. requirements without assigning additional capital and liquidity to its unit in the country. Mitsubishi UFJ Financial Group Inc. (8306), Japan’s biggest publicly traded bank, has operations in the U.S. including its San Francisco-based UnionBanCal Corp. unit.

Global Efforts…”

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Spin Doctor Economics Will Help U.S Growth to Hit 3%

“The U.S. economy will grow 3 percent larger in July because the government is tweaking certain statistics that add billions of dollars in intangible assets to the gross domestic product (GDP), according to the Financial Times.

The revisions are aimed at more accurate tracking of changes in U.S. output and include the addition of factors such as spending on research and development (R&D), the impact of creative works such as movies and music and defined pension benefit schemes.

“We are carrying these major changes all the way back in time — which for us means to 1929 — so we are essentially rewriting economic history,” Brent Moulton, manager of national accounts at the Bureau of Economic Analysis (BEA), told the Times….”

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[youtube://http://www.youtube.com/watch?v=eu7TOncR7FU 450 300]

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U.S. House Passes CISPA, Obama Said to Veto Bill


“The US House of Representatives  passed the Cyber Intelligence Sharing and Protection Act (CISPA) on 18 April, by a margin of 288 to 127, despite President Barack Obama’s veto threat.

CISPA, which was approved by the House last year, allows the US government and authorities to have access to private companies’ cyber threat information.

In an official statement, the US government recognised the importance of disclosing cyber security data in order to prevent and respond to malicious activities.

However, “the Administration still seeks additional improvements and if the bill, as currently crafted, were presented to the President, his senior advisors would recommend that he veto the bill”, the White House said.”

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G-20 Meeting To Provide Fireworks Over How to Handle EU Debt Crisis

“European Union nations are set to clash over plans to centralize the handling of failing banks, asGermany warned that the bloc is running out of road to adopt crisis-fighting measures under its current treaties.

German Finance Minister Wolfgang Schaeuble told his EU counterparts at a meeting in Dublin April 12-13 that there isn’t enough of a basis in the EU’s current rulebook for building a common authority and fund for bank failures. Other nations, including France, Luxembourg, andDenmark, are urging swift progress on putting in place a resolution system, amid concerns that treaty changes would cause unacceptable delays….”

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Deflation is Now on the ECB’s Table to Fix

“(Reuters) – Modeled on the hawkish, inflation-fighting Bundesbank, the European Central Bank is used to focusing on containing price rises rather than worrying about them increasing too slowly – or even falling.

But now ECB policymakers are keenly aware that inflation in their 17-country euro zone risks slipping further below their target of just under 2 percent, even if they insist deflation is not a threat.

The concern – which will add to pressure for the bank to cut interest rates or take other “easing” actions – has been highlighted by a slide in Greek inflation to below zero.

So far Greece, which entered deflationary territory in March for the first time in 45 years, is an isolated case. But price pressures are weak elsewhere in the euro zone periphery once tax rises are discounted.

In Portugal, annual inflation is running at 0.5 percent, although Nordea analyst Holger Sandte calculates consumer price inflation measured at constant tax rates is just 0.3 percent there. It is at 0.7 percent in neighboring Spain, he says.

“Given the recession, rising unemployment and tight fiscal policy in these countries, it would be no surprise at all to see rates below zero at least for a few months this year,” said Sandte, one of a batch of analysts to put out research notes in recent days on the risk of a drift towards deflation.

Even in France, inflation slowed to 1.1 percent in March….”

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Obama Proposes $3.77 Trillion Budget to Revive Debt Talks

“President Barack Obama sends a $3.77 trillion spending plan to Congress today that calls for reductions in Social Security and Medicare in a political gamble intended to revive deficit-reduction talks.

Obama’s budget for fiscal 2014 proposes $50 billion for roads, bridges and other public works, $1 billion to spur manufacturing innovation and $1 billion for an initiative to revamp higher education, according to administration officials who briefed reporters and asked to not be identified.

It renews his request to raise $580 billion in revenue by limiting deductions and closing loopholes for top earners. Obama again seeks adoption of the Buffett rule, named for billionaire investorWarren Buffett, to impose a 30 percent minimum tax on households with more than $1 million in annual income.

The administration projects the deficit for fiscal 2014 would be $744 billion, or 4.4 percent of the economy. That would mark the first budget shortfall of less than $1 trillion since Obama took office.

The revenue proposals have been previously rejected by Republicans and party leaders yesterday indicated they’ve seen nothing that will change their minds.

“It sounds like the White House just tossed last year’s budget into the microwave,” Senate Republican Leader Mitch McConnell of Kentucky said.

Democratic Objections…”

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Liberals Get Duped by Real Change Politics

“Liberals descended on Pennsylvania Avenue Tuesday to protest President Barack Obama’s decision to include entitlement cuts in his upcoming budget, delivering 2 million petitions demanding the White House back off its support for the chained CPI.

As we reported this weekend, liberals have been seething over the inclusion of the chained CPI in Obama’s budget, which they see as a huge betrayal by the Democratic president.

This week, progressive groups, including MoveOn, the Progressive Change Campaign Committee, and Democracy for America, have mounted “emergency” online campaigns against the proposal, accusing Obama of turning on the very supporters who helped re-elect him to office….”

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Italy Still Has Yet to Form a New Government

“Center-left leader Pier Luigi Bersani has failed in his attempt to find a way out of Italy’s political deadlock and President Giorgio Napolitano will now seek another solution, the president’s palace said on Thursday.

Bersani reported back to Napolitano on Thursday night after being given a mandate almost a week ago to see if he could muster enough support to form a government after the inconclusive election in February.

Napolitano’s office said Bersani, who took the largest share of the vote but failed to win a viable majority, had told him his talks with other parties had ended without resolution and the president would now assess other options “without delay”.

Bersani said he had told Napolitano of “significant, positive elements of understanding” in the talks with groups including Silvio Berlusconi’s centre-right bloc and the populist 5-Star Movement led by ex-comic Beppe Grillo.

“I also explained the difficulties deriving from objections or conditions which I did not consider acceptable.” …”

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D.C. Votes to End Subsidies for Big Banks

“Apparently the unanimous vote in Washington is not extinct.

On Saturday, as part of a marathon voting session in the Senate to pass the country’s first budget in four years, a measure was also approved 99-0 that sought to “end subsidies” based on size for the nation’s six largest financial institutions.

In essence, the Senate is saying banks should sustain an extra cost— not a lower cost—for being big….”

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Another Study Says New Health Law to Raise Costs by 32%

“WASHINGTON (AP) — A new study finds that insurance companies will have to pay out an average of 32 percent more formedical claims under President Barack Obama’s health careoverhaul.

What does that mean for you?

It could increase premiums for at least some Americans.

If you are uninsured, or you buy your policy directly from an insurance company, you should pay attention.

But if you have an employer plan, like most workers and their families, odds are you don’t have much to worry about.

The estimates from the Society of Actuaries could turn into a political headache for the Obama administration at a time when much of the country remains skeptical of the Affordable Care Act.

The administration is questioning the study, saying it doesn’t give a full picture — and costs will go down.

Actuaries are financial risk professionals who conduct long-range cost estimates for pension plans, insurance companies and government programs.

The study says claims costs will go up largely because sicker people will join the insurance pool. That’s because the law forbids insurers from turning down those with pre-existing medical problems, effective Jan. 1. Everyone gets sick sooner or later, but sicker people also use more health care services.

“Claims cost is the most important driver of health care premiums,” said Kristi Bohn, an actuary who worked on the study. Spending on sicker people and other high-cost groups will overwhelm an influx of younger, healthier people into the program, said the report…”

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Japan and the EU Enter Into Free Trade Agreement Talks

“TOKYO (AP) — Japan and the European Union agreed Monday to start negotiations for a free-trade pact encompassing nations that account for nearly a third of the world economy.

Japanese Prime Minister Shinzo Abe, European Council President Herman Van Rompuy and European Commission President Jose Manuel Barroso spoke by telephone for 30 minutes late Monday, aJapanese government spokesman said. A Japan-EU summit set to begin Monday in Tokyo was shelved because of the financial crisis in Cyprus.

The leaders agreed to launch the negotiations toward a “deep and comprehensive” free-trade deal, with the first meeting set for next month, both sides said in a joint statement. The place for that meeting is not yet decided, Deputy Chief Cabinet SecretaryKatsunobu Kato told reporters.

As global momentum builds for regional trade pacts, Japan has been eager to get started on talks with Europe. Earlier this month, Abe announced Tokyo will join talks on a Pacific trade pact, the U.S.-led Trans-Pacific Partnership. The U.S and EU announced free-trade talks earlier this year aimed at creating the world’s largest free-trade zone.

In the phone conversation, the three leaders exchanged views on Cyprus and reaffirmed their commitment to enhancing economic growth and ensuring financial stability. Cyprus secured an agreement early Monday that paves the way for a 10 billion euro ($13 billion) bailout.

“Today marks a historical juncture,” European Trade Commissioner Karel De Gucht, an official who did not cancel his trip, told reporters after meeting with Japanese government and business officials in Tokyo.

He was delighted the agreement was reached but acknowledged it was hard to predict how long the negotiations might take, adding that autos was one “sensitive” sector for the EU.

“We will do our utmost to come to a critical mass of understanding within one year,” he said.

Although resistance to lower tariffs is high in some Japanese industries, such as long-protected rice farmers, manufacturers and others are concerned about being left behind by the trade agreements that other countries are negotiating…”


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Cyprus Passes Bills to Wind Down Insolvent Banks

“Cypriot lawmakers approved capital controls and legislation to wind down banks as they scrambled to secure a European bailout and avert a financial collapse of the Mediterranean island.

The parliament passed nine bills late yesterday after a day locked in talks between Cypriot and international officials in Nicosia. Lawmakers may vote later today on what sort of levy to impose on bank deposits above 100,000 euros ($130,000), four days after rejecting an initial proposal to tax all accounts. Banks have been shut all week and are due to reopen on March 26.

President Nicos Anastasiades is trying to end a week-long impasse that is starting to threaten the country’s membership in the euro. The European Central Bank has imposed a March 25 deadline on Cyprus to come up with proposals that will satisfy international creditors or face the risk of losing access to all emergency funds.

“We cannot fund banks that are bankrupt,” ECB council member Erkki Liikanen told Finland’s YLE TV1 today. “There is now a chance of drawing up a program in which the banks are recapitalized or reorganized to reach solvency. The ball is in Cyprus’s court.” …”

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Russia Rejects Cyprus’s Offer of Assets in Lieu of a Bailout

“Russia spurned Cyprus’s offers of assets for a bailout as the island nation’s lawmakers begin debate on legislation to avert a financial collapse.

“I think we aren’t able to get the support that we wanted to get,” Cypriot Finance Minister Michael Sarris said in an interview after checking out of the Lotte Hotel in Moscow. “But we must go back home because things are getting serious.”

Cypriot lawmakers begin debating legislation today to prevent a financial meltdown as the European Central Bank threatens to cut off a lifeline for the country’s banks in three days unless a bailout agreement with the European Union is reached. Russian companies and individuals may have about $31 billion of deposits in Cyprus, which in turn is the biggest source of foreign direct investment in Russia.

“The only thing that Cyprus could hope for is Gazprom buying some reserves from them,” Vladimir Kolychev, head of research at Societe Generale SA’s Rosbank (ROSB) unit in Moscow, said by phone. “It’s not clear what these gas reserves are worth, and apparently Gazprom wasn’t particularly interested.”

Russia has ended talks with Cyprus and will decide on participating in restructuring debt after the so-called troika overseeing euro-area bailouts makes its decision, Finance Minister Anton Siluanov told reporters today. The troika comprises officials from the European Commission, ECB andInternational Monetary Fund.

Door Open…”

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The Senate Passes Bill to Fund Gubmint Operations

“The Senate Wednesday passed a bill to keep the government operating through September—a rare bipartisan compromise that is near certain to pass the House and avoid the budget brinkmanship that has often tied Congress in knots in recent years.

The bill, which was approved 73-26, leaves in place the mandate that $85 billion in across-the-board spending cuts take affect across domestic and defense programs over the next six months but would soften the blow for some programs.

The compromise accommodated both House Republicans’ desire to bulk up the Pentagon’s budget for operations and maintenance, as well as Senate Democrats’ desire to shore up domestic programs such as nutrition aid for women and children and Head Start, an early-childhood-education program.

Even in such programs, the bill eases but doesn’t eliminate the impact of the cuts, known as a sequester.

During Senate debate on the bill, lawmakers of both parties sought—largely without success—to offer amendments to undo the effects of the sequester on pet programs. Sen. Jerry Moran (R., Kan.) pushed an amendment to prevent projected furloughs of air-traffic controllers, which he said could threaten to close many airports in rural areas—including seven in Kansas.

Democratic leaders refused to allow most such amendments, fearing that would open the floodgates for sequester exceptions. They said efforts to reverse the sequester would be addressed in Democrats’ 2014 budget resolution—a long-term plan for raising taxes and cutting spending that was brought to the Senate floor after the funding bill passed Wednesday…..”

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Tick Tock Goes the Cyprus Debt Clock; ECB Hands Country Ultimatum

“The European Central Bank said it will cut Cypriot banks off from emergency funds after March 25 unless the Mediterranean island agrees on a bailout with the European Union andInternational Monetary Fund.

“The Governing Council of the European Central Bank decided to maintain the current level of Emergency Liquidity Assistance, ELA, until Monday, 25 March 2013,” the Frankfurt- based ECB said in an e-mailed statement today. “Thereafter, ELA could only be considered if an EU/IMF program is in place that would ensure the solvency of the concerned banks.”

The Cypriot parliament this week rejected a proposed levy onbank deposits to raise 5.8 billion euros ($7.5 billion), which euro-area finance ministers backed as a condition for the country’s bailout. A bank holiday in Cyprus has been extended to March 25, giving policy makers until Monday to find a compromise to prevent a collapse of the country’s banks.

“With this statement, the ECB put even more pressure on European finance ministers and the Cypriot government to come up with a deal,” said Juergen Michels, chief euro-area economist at Citigroup Inc. in London. “But we’ll have to see whether they’ll actually follow through with their threat if there’s no deal by Monday and policy makers decide to further extend the bank holiday.”

’Poker Game’….”

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