Bits & Pieces (Tuesday Evening Open Mic)

Posted on November 15, 2011 by Kevin S. Willis

The Chicago Climate Exchange is closing. Founded in 2000 in order to provide an exchange for carbon credits, a market they expected to exist, and amenable to becoming a hyper-inflated asset bubble, due to legislation that (sad to say) never came to be.

“Environmentalist” financiers will just have to find some other way to get filthy rich and leave the American tax payer holding the bag, after the bubble bursts.

Glenn Beck thinks Rick Santorum is the next George Washington. I feel about that assertion the way Lloyd Bentsen felt about Dan Quayle bringing up JFK in the debates. Mr. Beck, Rick Santorum is no George Washington.

Bentsen rolled Quayle in that VP debate. But Bush/Quayle won the election. Perhaps in part because Bentsen wasn’t on the top of the ticket. 
Let’s not forget Dukakis. What I remain struck by in this video is both the inappropriate personalization of Bernard Shaw’s question and Dukakis’s mild, professorial answer. My first reaction to his question, however, is: holy crap, what kind of question is that, you sick freak? I would not do well in the debates.
Let those who think the tone of our national dialog, or the quality of our debates, has gone down terribly over the past few decades look upon Bernard Shaw 23 years ago and despair. Despair!
***
Science denier Dr. Tim Ball argues that CO₂ is a trailing indicator of global temperature, not causal. Say what? 
Speaking (with reverence) of the magical ONJ, the title track from the movie Xanadu (yes, that’s Gene Kelly doing a little roller-boogie at the beginning). 
Xanadu is one of my guilty pleasures. I know it’s a bad movie, yet I love it so. I’m not the only person who knows it’s a bad movie: on the DVD release, which I have, the DVD extras feature a stunt person, one of the costumers or a key grip or somebody, and a “renowned fan” of the film. Not a single major actor (especially not ONJ) was apparently willing to discuss the movie (in fairness, most of those interviews are freebies, and the participants get no compensation). 
But there’s a great dance number with ONJ and Gene Kelly in the middle of the movie. It’s dreamy. However, searching for ONJ performing “Xanadu” (I love that song), I ran across this from the 2002 Grease DVD release. OMG! John Travolta and ONJ reunited to sing “You’re the One That I Want! OMG! OMG!
Laterz! — KW

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Morning Report

Posted on November 15, 2011 by Brent Nyitray

Vital Statistics:

Last Change Percent
S&P Futures 1239.3 -13.1 -1.05%
Eurostoxx Index 2247.2 -41.100 -1.80%
Oil (WTI) 97.88 -0.260 -0.26%
US Dollar Index (DXY) 77.842 0.298 0.38%
10 Year Govt Bond Yield 2.00% -0.06%

Markets are weaker this morning as Spanish bond yields rose at an auction. The 10-year Spanish bond yield rose 21 basis points to 6.32%. The Italian government bond yield rose to 7.03%. EURIBOR / OIS is about 1.5 basis points higher at 90.9 bps. The UK and Germany are clashing over a proposed financial transaction tax, with the UK refusing to go along with a Euro Financial Transactions tax unless the US and Asian markets institute one. The City of London is in fact the financial center of Europe and the UK estimates that they would end up paying roughly 80% of the tax. British Prime Minister David Cameron cheekily suggested that requiring the UK to institute a financial transactions tax would be like asking the French to institute a cheese tax.

There was a slew of encouraging economic data this morning. The Producer Price Index came in lower than expected, indicating inflationary pressures (at least as measured by the government) remain under control. Retail sales came in better than expected, though the .6% increase is a modest number. I have pointed out that there has been a disconnect lately between the sentiment indicators and the actual spending numbers. Finally Empire Manufacturing came in better than expected as well.

The Wall Street Journal has a story on the state of finances at FHA. The FHA’s reserves have dropped to $2.6 billion which is .24% of the $1.1 trillion of loans it insures. The FHA is actually required to hold 2% reserves. This raises the possibility that FHA will run out of money and need more money from the government. The recent audit of FHA estimates they will squeak by, assuming real estate prices drop 5.6% this year and rise 1.2% in 2012. Fortunately for FHA, they can go directly to Treasury and can bypass Congress.

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