Thursday, July 23, 2009

The Capital Spin

Wall Street

http://www.youtube.com/watch?v=GQnCFdjLJAM
Vatican Slams ‘Greed Is Good’ Wall Street Mantra (Update2)

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By Flavia Krause-Jackson

July 28 (Bloomberg) -- Vatican Secretary of State Tarcisio Bertone said free-market economics legitimized greed, citing the 1987 Oliver Stone movie “Wall Street” and its protagonist, the corporate raider Gordon Gekko.

“Greed market has substituted free market,” Bertone said today in a speech to Italian senators in Rome. “Greed is good, greed is right,” Bertone said, citing one of Gekko’s famous lines from the film, in outlining the contents of Pope Benedict XVI’s encyclical calling for a new financial order.

The 82-year-old pontiff on July 7 published the 150-page “Caritas in Veritate,” Latin for “Charity in Truth.” The pope’s reflections on capitalism were two years in the making and publication was held up by the credit crunch. The text also examines ways out of the worst recession since World War II.

“Once profit becomes the exclusive goal, if it is produced by improper means and without the common good as its ultimate end, it risks destroying wealth and creating poverty,” Benedict wrote in the encyclical.

Bertone, the second-highest ranking official in the Vatican, underscored the pope’s message to Italy’s legislators. Since the 1970s, he said, developed nations had “exposed their real economies to the whims of finance” and convinced consumers to spend beyond their purchasing power.

Benedict, the head of the world’s smallest state, has been outspoken in denouncing globalization and has even been credited with predicting the financial crisis.

Last November, Italian Finance Minister Giulio Tremonti said the pope had pronounced a “prophecy” in a paper Benedict wrote when he was a cardinal.

In 1985, then-Cardinal Joseph Ratzinger presented a paper titled “Market Economy and Ethics” at a Rome event on the Catholic Church and the economy. He said a decline in ethics “can actually cause the laws of the market to collapse.”

Two years later, Michael Douglas turned in an Oscar-winning performance as Gekko. The character, loosely based on convicted arbitrager Ivan Boesky, came to symbolize the excesses of Wall Street in the 1980s.

Benedict has made frequent comments on the economy since the financial crisis erupted last fall. In an Oct. 7 speech, he reflected on crashing markets and concluded that “money vanishes, it is nothing,” and warned that “the only solid reality is the word of God.”

For Related News and Information: News on the Vatican: NI POPE News on Benedict: POPE BENEDICT XVI For more on the Encyclical: NSE Benedict Encyclical

Last Updated: July 28, 2009 09:57 EDT


In A New York Minute Don Henley
http://www.youtube.com/watch?v=zigWpC0GHGw

Perception is reality in the financial markets…the stock market.

The Stock Market is performing best when cash flows are up.

Supply and demand…Capitalism…fuels the market.

It behooves all those connected to push the "Buy Buy Buy" message,
or "you will miss the move."

Cash inflows from the greatest Ponzi scheme ever perpetrated against the public, the hand that feeds the market, have long and lasting memory and effect.

The 401k,now a 201k is evidence of that.

That being said;
any spin regarding "minimal importance of the Jobless claims report...
or how the unemployment numbers are trending downward should take note of this:

Jobs fuels Consumer Spending

70% of the U.S. economy, for better or worse, is reflected through Consumer Spending.

You don’t need an MBA from Harvard,
although it helps if you're intent is fraud,
No MBA needed to come to the conclusion jobs fuel spending,
People out of work can’t freely spend money.

Weekly Jobless Claims

The importance of this number is best served as a forward looking talking point.

Real Time, how much worse can it get?

The number is seasonally adjusted…
It’s often revised…and
It is a lagging indicator.
(Not a good crystal ball tool)

Non-Farm Employment

This monthly report is clearly more valuable to the discerning American.

The bad news: the number is skewed.
It distorts real job data
It hides part-time employment
It eliminated the disenfranchised worker

Bureau of Labor Statistics (BLS)
http://www.bls.gov/
http://www.bls.gov/news.release/pdf/empsit.pdf

Key data last month

Civilian Labor force………155 million
The number of unemployed persons (14.7 million)
and the unemployment rate (9.5 percent)
were little changed in June.

Since the start of the recession in December 2007,
the number of unemployed increased by 7.2 million,
(part-time workers) was little changed in June at 9.0 million.
Since the start of the recession, the number of such workers has increased by 4.4 million. (See table A-5.)

About 2.2 million persons not counted as unemployed
These individuals wanted and were available for work and had
looked for a job sometime in the past 12 months.

Among the marginally attached, there
were 793,000 discouraged workers in June, up by 373,000 from a year earlier. Discouraged workers are persons not currently looking for work
because they believe no jobs are available for them.

The other 1.4 million persons marginally attached to the labor force
in June had not searched for work in the 4 weeks preceding the survey
for reasons such as school attendance or family responsibilities.
(See table A-13.)


The newest data will be released on August 7, 2009
Hold your breath.

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