US Deposits In Perspective: $25 Billion In Insurance, $9,283 Billion In Deposits; $297,514 Billion In Derivatives

Via: ZeroHedge

Submitted by Tyler Durden on 03/19/2013

Earlier today, the American Banking Association reminded Americans that there is absolutely nothing to worry about when it comes to the sanctity of US deposits: after all there is a whopping $25 billion in the FDIC insurance fund which means “insured depositors are safe and their deposits are protected by a strong FDIC fund….The FDIC insurance fund has over $25 billion in reserves and the banking industry ” Obviously supposedly “insured” depositors in Cyprus also though there was nothing to worry about, until they woke up on Saturday with a haircut between 6.75% and 9.9% on their money in the bank. Sadly, it may be the case that the ABA is being just modestly disingenuous in its statement. Why? Instead of explaining it in detail, here is a snapshot that does more than thousands of words ever could.

Chart drawn to scale.

Read more: here

That doesn’t look good….
-Moose

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‘Homeland Security’ Has Received $791 Billion Since 9/11

Via: MSNBC

What is “homeland security?”

Whatever it is, the federal government has spent on a fortune on it. In the aftermath of 9/11 and the beginning of the interminable War on Terror, the Bush administration founded the Department of Homeland Security to act as a central, coordinating office which could respond to the new threats of the modern era. But in addition to the funds pouring into that department, Congress has allocated vast sums for “homeland security” expenditures in other departments, most notably at the Pentagon.

In fact, according to a new investigation from the Nation Institute’s Tomdispatch, $791 billion dollars in federal funding have gone to homeland security, both within and without the department.

“To give you a sense of just how big that is,” write analysts Chris Hellman and Mattea Kramer, “Washington spent an inflation-adjusted $500 billion on the entire New Deal.”

Read more: here

‘Homeland Security’ Has Received $791 Billion Since 9/11

Via: MSNBC

What is “homeland security?”

Whatever it is, the federal government has spent on a fortune on it. In the aftermath of 9/11 and the beginning of the interminable War on Terror, the Bush administration founded the Department of Homeland Security to act as a central, coordinating office which could respond to the new threats of the modern era. But in addition to the funds pouring into that department, Congress has allocated vast sums for “homeland security” expenditures in other departments, most notably at the Pentagon.

In fact, according to a new investigation from the Nation Institute’s Tomdispatch, $791 billion dollars in federal funding have gone to homeland security, both within and without the department.

“To give you a sense of just how big that is,” write analysts Chris Hellman and Mattea Kramer, “Washington spent an inflation-adjusted $500 billion on the entire New Deal.”

Read more: here

The Ethics of Repudiation

Via: Ludwig von Mises Institute

Tuesday, February 26, 2013 by John P. Cochran

Do you ever get the feeling that no one in the Washington power elite is willing to seriously deal with the major economic threat to future prosperity facing the United States today: mounting government debt and the associated deficits? The problem, as pointed out by Murray Rothbard over 20 years ago:

Deficits and a mounting debt, therefore, are a growing and intolerable burden on the society and economy, both because they raise the tax burden and increasingly drain resources from the productive to the parasitic, counterproductive, “public” sector. Moreover, whenever deficits are financed by expanding bank credit—in other words, by creating new money—matters become still worse, since credit inflation creates permanent and rising price inflation as well as waves of boom-bust “business cycles.”

In 1992, when Rothbard wrote the above, the US debt was approaching $4 trillion (now nearing $17 trillion) and Federal Reserve policy was relatively benign compared to the current quantitative easing, which is effectively monetizing a significant portion of newly created government debt. The “peace dividend” from the end of the Cold War and the false prosperity from two Fed-created economic booms made the problem appear less urgent and allowed politicians to kick the can down the road. A solution is now urgent, but not likely. David Henderson’s “Must Default Be Avoided at All Costs?” is a great place to start in order to reinvigorate a serious discussion on a moral approach to shrinking the size of the federal government down to a less destructive level.

Read more: here

The Ethics of Repudiation

Via: Ludwig von Mises Institute

Tuesday, February 26, 2013 by John P. Cochran

Do you ever get the feeling that no one in the Washington power elite is willing to seriously deal with the major economic threat to future prosperity facing the United States today: mounting government debt and the associated deficits? The problem, as pointed out by Murray Rothbard over 20 years ago:

Deficits and a mounting debt, therefore, are a growing and intolerable burden on the society and economy, both because they raise the tax burden and increasingly drain resources from the productive to the parasitic, counterproductive, “public” sector. Moreover, whenever deficits are financed by expanding bank credit—in other words, by creating new money—matters become still worse, since credit inflation creates permanent and rising price inflation as well as waves of boom-bust “business cycles.”

In 1992, when Rothbard wrote the above, the US debt was approaching $4 trillion (now nearing $17 trillion) and Federal Reserve policy was relatively benign compared to the current quantitative easing, which is effectively monetizing a significant portion of newly created government debt. The “peace dividend” from the end of the Cold War and the false prosperity from two Fed-created economic booms made the problem appear less urgent and allowed politicians to kick the can down the road. A solution is now urgent, but not likely. David Henderson’s “Must Default Be Avoided at All Costs?” is a great place to start in order to reinvigorate a serious discussion on a moral approach to shrinking the size of the federal government down to a less destructive level.

Read more: here

Recovery: Disposable Income Takes Biggest Plunge Since Monthly Records Began in 1959

Via: Bloomberg

By Michelle Jamrisko – Mar 1, 2013 6:18 AM PT

Consumer spending in the U.S. rose in January even as incomes dropped by the most in 20 years, showing households were weathering the payroll-tax increase by socking away less money in the bank.

Household purchases, which account for about 70 percent of the economy, climbed 0.2 percent after a 0.1 percent gain the prior month, a Commerce Department report showed today in Washington. The median estimate in a Bloomberg survey of 76 economists called for a 0.2 percent advance. Incomes slumped 3.6 percent, sending the saving rate down to the lowest level since November 2007.

 Jonathan Golub, chief U.S. market strategist at UBS Securities LLC, talks about the outlook for the U.S. economy, the possible impact of federal budget sequestration on consumers and fiscal policy. He speaks with Tom Keene, Sara Eisen and Robert Litan on Bloomberg Television’s “Surveillance.” David Riley, managing director at Fitch Ratings, also speaks. (Source: Bloomberg)

Employment gains, the rebound in housing and growing demand for autos will probably keep supporting consumer spending in the first quarter as the world’s largest economy picks up from an end-of-year slowdown. Even so, rising gasoline prices and the need to rebuild nest eggs may make it difficult for households to match last quarter’s performance.

“It’s going to be touch and go for the consumer for the next few months,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania, who correctly projected the 3.6 percent drop in income. “The consumer is going to be able to support the recovery, but they’re not going to be able to take it” to a higher level, he said.

Read more: here

Recovery: Disposable Income Takes Biggest Plunge Since Monthly Records Began in 1959

Via: Bloomberg

By Michelle Jamrisko – Mar 1, 2013 6:18 AM PT

Consumer spending in the U.S. rose in January even as incomes dropped by the most in 20 years, showing households were weathering the payroll-tax increase by socking away less money in the bank.

Household purchases, which account for about 70 percent of the economy, climbed 0.2 percent after a 0.1 percent gain the prior month, a Commerce Department report showed today in Washington. The median estimate in a Bloomberg survey of 76 economists called for a 0.2 percent advance. Incomes slumped 3.6 percent, sending the saving rate down to the lowest level since November 2007.

 Jonathan Golub, chief U.S. market strategist at UBS Securities LLC, talks about the outlook for the U.S. economy, the possible impact of federal budget sequestration on consumers and fiscal policy. He speaks with Tom Keene, Sara Eisen and Robert Litan on Bloomberg Television’s “Surveillance.” David Riley, managing director at Fitch Ratings, also speaks. (Source: Bloomberg)

Employment gains, the rebound in housing and growing demand for autos will probably keep supporting consumer spending in the first quarter as the world’s largest economy picks up from an end-of-year slowdown. Even so, rising gasoline prices and the need to rebuild nest eggs may make it difficult for households to match last quarter’s performance.

“It’s going to be touch and go for the consumer for the next few months,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania, who correctly projected the 3.6 percent drop in income. “The consumer is going to be able to support the recovery, but they’re not going to be able to take it” to a higher level, he said.

Read more: here

A Primer On Discharging Student Debt

Via: Zero Hedge

Since the Fed is doing all it can to relieve the big banks and all legacy debtors of their debt obligations, it is only fair that those incumbered with student debt – impacting those who can least afford it – and which is at least on the surface nondischargeable, are afforded the same opportunity.

So here is a primer for the rest of us – those who don’t have $1.8 trillion in very fungible reserves holed up with the Federal Reserve. As Christopher Glazek and Sean Monahan note, discharging student debt is a black-box dilemma. While bankruptcy protocols are always complex, student debt is loaded with its own special brand of illegibility. Debtors are misled by the media into thinking that discharging student loans is impossible and shamed into treating the mere notion of relief as a form of extravagant welfare-queenism – however, there is a way (or 12 ways) to show your future life prospects are characterized by a “certainty of hopelessness.”

CERTAINTY OF HOPELESSNESS: A PRIMER ON DISCHARGING STUDENT DEBT
By CHRISTOPHER GLAZEK SEAN MONAHAN,

Discharging student debt is a black-box dilemma. While bankruptcy protocols are always complex, student debt is loaded with its own special brand of illegibility. Debtors are misled by the media into thinking that discharging student loans is impossible and shamed into treating the mere notion of relief as a form of extravagant welfare-queenism.

Our original intention was not to create a satire, but rather to map the possibilities for broke postgrads interested in taking a more adversarial approach to dealing with their debt. Guides like Strike Debt’s Debt Resistors Operations Manual help combat the vili!cation of debtors and address pragmatic concerns about keeping loans out of default. For hundreds of thousands of ex-students, though, default is inevitable and discharge is the goal.

Bankruptcy filers have the option of calling for a special separate hearing, called an “adversary proceeding,” during which a bankruptcy judge determines whether a student loan can be considered in a broader bankruptcy claim. To clear the legal hurdle, debtors must not only demonstrate that they are currently unable to pay – they must also demonstrate that their future life prospects are characterized by a “certainty of hopelessness.”

Read more: here

Money Is A Form Of Social Control

Via: ICH

Most Of Us Spend Our Entire Lives Trapped In An Endless Cycle of Debt That We Never Escape Until We Die, Those That Own Our Debts Keep Getting Richer!

By Michael Snyder

February 20, 2013 “Information Clearing House” – Is America really “the land of the free”? Most people think of money as simply a medium of exchange that makes economic transactions more convenient, but the truth is that it is much more than that. Money is also a form of social control. Just think about it. What did you do this morning? Well, if you are like most Americans, you either got up and went to work (to make money) or to school (to learn the skills that you will need to make money).

We spend a great deal of our lives pursuing the almighty dollar, and there are literally millions of laws, rules and regulations about how we earn our money, about how we spend our money and about how much of our money the government gets to take from us. Not that money is a bad thing in itself. Without money, it would be really hard to have a modern society. Unfortunately, our money is based on debt, and debt levels in the United States have exploded to absolutely unprecedented levels in recent years.

The borrower is the servant of the lender, and if you are like most Americans, nearly every major purchase that you make in your life is going to involve debt. Do you want to get a college education so that you can get a “good job”? You are told to get a student loan. Do you want a car? You are encouraged to get an auto loan and to stretch out the payments for as long as possible. Do you want a home? You are probably going to end up with a big fat mortgage. And of course I could go on and on and on.

The cold, hard truth of the matter is that most Americans are debt slaves. Most of us spend our entire lives trapped in an endless cycle of debt that we never escape until we die, and meanwhile our years of hard labor are greatly enriching those that own our debts.

Have you ever found yourself wondering why you can never seem to get ahead financially no matter how hard you work?

Read more: here