As U.S. default threatened, banks took extraordinary steps

Yahoo News
November 19, 2013

NEW YORK (Reuters) - As the United States threatened to default on its debt last month, major U.S. banks set up war rooms, spent many millions of dollars on contingency planning and, in some cases, even prepared to underwrite federal government benefits.

In a series of interviews with top bank executives, new details emerged about the extent of the contingency planning that was undertaken before and during the 16-day government shutdown and as a potential default loomed.

The planning for worst-case scenarios didn't come cheap. JPMorgan alone has spent more than $100 million on contingency planning for U.S. budget crises in recent years including this one, sources close to the bank say. It has reviewed and analyzed thousands of trading contracts, updated computer systems to handle fiscal emergencies, hired consultants, and built new models to figure out what might happen to securities prices.

It may not go to waste. The temporary budget agreement that President Barack Obama signed shortly after midnight on October 17 to end the shutdown and lift the default threat, authorizes government spending through January 15 and eases enforcement of the debt limit until February 7, creating the potential for another budget crisis early next year, even as some Republicans vow they will avoid it.

With each crisis, the once-unthinkable scenario of a U.S. default becomes a little more real, bank executives said.

"You could tell in the market that people were getting prepared much more this time for a potential default than last time," said a person involved with contingency planning at a major U.S. bank. "The threat moved the market, and people were preparing, whereas the first time there was little movement because most people didn't think it would happen."

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Obamacare: The Final Nail In The Coffin For The Middle Class

Economic Collapse
November 18, 2013

If there were any shreds of hope left that the stunning decline of the middle class could be turned around, Obamacare has absolutely destroyed them.  Over the past decade or so, the middle class in the United States has been absolutely eviscerated. 

Image: Wikimedia Commons.

The number of working age Americans without a job has increased by 27 million since the year 2000, median household income in the U.S. has fallen for five years in a row, and the poverty numbers in this country are spiraling out of control.  And now here comes Obamacare.  As you will see below, Obamacare is causing millions of Americans to lose their current health insurance policies, it is causing health insurance premiums to explode to absolutely ridiculous levels, and it is systematically killing jobs even though the employer mandate has been delayed for a while.  All of this is creating a tremendous amount of stress for millions of middle class families that are already stretched extremely thin financially.  According to CNN, a survey that was conducted earlier this year found that 76 percent of all Americans are living paycheck to paycheck.  Most of those families simply cannot afford to pay much higher health insurance premiums for new policies that also come with much larger deductibles and significantly increased out-of-pocket costs.  Millions of those families will ultimately end up choosing to do without health insurance altogether, and that will create a whole host of new problems.  This is a disaster that is so enormous that it is really hard to put into words.  If the U.S. health care system was a separate country, it would be the 6th largest economy on the entire globe all by itself.  And now Obamacare is going to bring the entire U.S. health care system to its knees.

Obamacare: Since October 1st, The Number Of Americans With Health Insurance Has Fallen By Nearly 4 Million

Last week, Barack Obama decided to allow Americans to keep their current health insurance plans for one more year.

Isn’t that generous of him?  Especially considering the fact that he promised us over and over that if we liked our current health insurance policies that we would be able to keep them permanently.

The funny thing is that Obama is not actually changing the law.  So if your health insurance company allows you to stay on your current health insurance plan that does not meet the requirements of Obamacare, it is technically breaking the law.

And if you continue to stay on that current health insurance plan that does not meet the requirements of Obamacare, you are technically breaking the law.

It is just that Obama has promised not to enforce what the law says for one year.

For a president to just blatantly disregard the rule of law is a very dangerous precedent.  Do we really want the president to have the power to decide what laws are going to be enforced and what laws are not going to be enforced?

That sounds dangerously close to a dictatorship to me.

And in any event, there are many Americans that are not going to be able to keep their current policies no matter what Obama says.  For example, just two hours after Obama announced his plan last week, the state of Washington announced that they would not be allowing insurance companies to extend their old health insurance plans if they don’t comply with Obamacare under any circumstances…

State Insurance Commissioner Mike Kreidler has rejected President Obama’s proposal to allow insurance companies to extend health insurance policies for people who have received notices that their policies will be cancelled at the end of the year.

Within two hours of President Obama’s news conference announcing the proposed administrative fix for Americans upset by their policy cancellations, Kreidler issued a statement rejecting the proposal.

“I understand that many people are upset by the notices they have recently received from their health plans and they may not need the new benefits [in the Affordable Care Act] today,” he said. “But I have serious concerns about how President Obama’s proposal would be implemented and more significantly, its potential impact on the overall stability of our health insurance market.”

“I do not believe his proposal is a good deal for the state of Washington,” Kreidler’s statement continued. “We will not be allowing insurance companies to extend their policies.”

How do you think the people of the state of Washington will respond to that?

Things are getting crazy out there, and the number of people that are losing their health insurance policies is absolutely stunning.

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D.C. Insurance Commissioner Fired After Criticizing Dictator In Chief Obama

News Max
November 17, 2013

The District of Columbia's insurance commissioner was given his walking papers on Friday, one day after he challenged President Barack Obama's fix of the troubled rollout of his signature healthcare law, The Washington Post reports. 

Obama held a Thursday press conference, saying he would allow insurance companies to continue offering people policies they wanted to keep, though they had previously been dubbed substandard because they didn't offer all the benefits required under the new law."

"The action today undercuts the purpose of the exchanges, including the District’s DC Health Link, by creating exceptions that make it more difficult for them to operate," D.C. insurance commissioner William P. White said in a statement on the department's website afterward. 

The next day, White was called into a meeting with the top deputies of Democratic D.C. Mayor Vincent C. Gray and was told the mayor "wants to go in a different direction."

White told The Post that he was never told his statement was the reason for his firing, but he suspected the timing was not coincidental.

While Obama's order did not require insurance companies to re-offer policies they have cancelled, the National Association of Insurance Commissioners noted that it "threatens to undermine the new market, and may lead to higher premiums and market disruptions in 2014 and beyond."

White wrote that he concurred with that opinion.
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Opium Crop in Afghanistan Up 36 Percent, Says UN Report

The New American
November 15, 2013

Matheny's Note: Isn't it funny that the opium sales have gone up since we've had our troops guarding the opium fields? Hmmmm.....

A November 13 press release issued by the UNODC — the United Nations Office on Drugs and Crime — stated that opium poppy cultivation in Afghanistan rose 36 percent in 2013, which is a record high. Additionally, opium production amounted to 5,500 tons, up by 49 percent since 2012.

The release cited as its source the 2013 Afghanistan Opium Survey released the same day in Kabul by the Ministry of Counter Narcotics and the UNODC.   

Yury Fedotov, executive director of the UNODC, called the news “sobering” and emphasized that the increase in opium production presents a threat to health, stability, and development in Afghanistan and elsewhere. “What is needed is an integrated, comprehensive response to the drug problem. Counter-narcotics efforts must be an integral part of the security, development and institution-building agenda,” said Fedotov.

The report indicated that the area of opium poppies under cultivation in Afghanistan rose to 209,000 hectares from the previous year's total of 154,000 hectares, and was higher than the peak of 193,000 hectares reached in 2007. (A hectare is equal to 100 acres.)

“As we approach 2014 and the withdrawal of international forces from the country, the results of the Afghanistan Opium Survey 2013 should be taken for what they are — a warning, and an urgent call to action,” Fedotov continued.

When an AP reporter interviewed an Afghan farmer named Khan Bacha, who lives in the village Cham Kalai, in the eastern province of Nangarhar, he provided his explanation for turning to farming poppies. “People are poor, families are big. Wheat is no good,” said Bacha. “The only thing that is good is poppies. They are gold.”

The report noted that there was a five-fold increase in the number of acres planted in poppies in Nangarhar from 2012-2013, representing the biggest increase in Afghanistan.

Nangarhar is a stronghold for Taliban insurgents, noted Kathy Gannon, AP’s special regional correspondent for Afghanistan and Pakistan. She observed that the mere mention of security in the area made Bacha smile. The farmer gestured off in the distance and said that just the night before the Taliban fought a fierce battle with Afghan troops backed by “foreign soldiers” — referring to NATO troops.

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In many states, the recovery is making the income gap worse

The Washington Post
November 18, 2013

A sign showing a foreclosed home in Texas for sale in August 2006. (David J. Phillip/Associated Press.)

The income gap in America has been widening for decades and the modest three-year recovery did little to change that, according to new Census data.

The new data suggest that despite modest recoveries in many states, the middle class has been shrinking while households have been added in the lowest and highest income brackets. The state-by-state data compare incomes from a pair of three-year periods: 2007 through 2009, a span that included the Great Recession, and 2010 through 2012, a period that included the ongoing and modest recovery.

For years, the wealthiest 1 percent have amassed income more quickly than the rest. From 1979 through 2007, for example, the top 1 percent of households saw income grow by 275 percent, according to a nonpartisan Congressional Budget Office study. Compare that to the bottom fifth of households, which saw income gains of only 18 percent over that time. Recent Nobel Prize winner for economics Robert Shiller, who is known for creating a closely tracked home-price index, last month called income inequality “the most important problem that we are facing now today.” And just last week, President Obama’s nominee to lead the Federal Reserve, Janet Yellen, called income inequality “an extremely difficult and to my mind very worrisome problem.”

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A Russian GPS Using U.S. Soil Stirs Spy Fears

New York Times
November 18, 2013

Pedro Ladeira/Agence France-Presse — Getty Images

A technician from Russia's space agency at a monitor station that opened in Brazil.

WASHINGTON — In the view of America’s spy services, the next potential threat from Russia may not come from a nefarious cyberweapon or secrets gleaned from the files of Edward J. Snowden, the former National Security Agency contractor now in Moscow.

Instead, this menace may come in the form of a seemingly innocuous dome-topped antenna perched atop an electronics-packed building surrounded by a security fence somewhere in the United States.

In recent months, the Central Intelligence Agency and the Pentagon have been quietly waging a campaign to stop the State Department from allowing Roscosmos, the Russian space agency, to build about half a dozen of these structures, known as monitor stations, on United States soil, several American officials said.

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Big Government Always Makes Things Worse

Personal Liberty Digest
November 18, 2013

PHOTOS.COM

There is little more damaging than government when it sets out to solve a problem.

The grossly misnamed Affordable Care Act (aka Obamacare) is one example. But just one… and just a very expensive one.

Recall that the Obamacare law was touted as a way to make it possible for the uninsured (and uninsurable) to get health insurance. At the time, the elected class, statist bureaucrats, nannies, progressives, crony capitalists, the mainstream media propaganda machine and President Barack Obama himself claimed that about 30 million Americans could not get health insurance coverage.

But what they didn’t say was that of those 30 million, 10 million were illegal aliens and supposedly not eligible for coverage and another 10 million were either young and healthy and chose to forgo health insurance or were eligible for public programs like Medicaid and S-CHIP and had not enrolled for one reason or another. That left about 10 million people who were truly unable to acquire health insurance.

For that, the elected class conspired with the medical-industrial establishment and the health insurance industry to blow up health insurance and create a massive redistributive system that guaranteed more customers for the medical establishment with guaranteed payments from the Federal Treasury.

The result is a predictable — and predicted — failure of historic proportions. It created a bureaucratic deathcare trap of death panels, rising premiums, rising deductibles and disappearing options. If Obamacare is every fully implemented –  a big if considering the failure of the $600 million-plus Healthcare.gov and the sticker shock being felt by the few people able to successfully log in — at least 31 million will remain uninsured.

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