Heat Wave Not Caused By *Man-Made* Climate Change

The media have worked themselves into a frenzy covering the record 2012 US Heat Wave. Sensational headlines can be found everywhere, even on the conservative Drudge Report, whose top story today was "From Boil To Broil". Not surprisingly, the pastors of the Church of Man-Made Global Warming have been preaching that this period of extreme weather is evidence of man-made global warming. Unfortunately, the majority of Americans are in the congregation: A recent survey (.pdf) conducted by Yale University concluded that 69% of Americans believe that recent extreme weather has been caused by global warming, and, according to Gallup, 60% of Americans believe it has been caused by influenced by "human activity" .

One record heat wave doesn't make a trend, and even NASA, a government agency whose funding is partially tied to climate change research, admits that the world has cooled since 1998. But, assuming the planet is warming, does that necessarily mean that humans are the cause? Of course not. In 2007 the green movement-sympathising National Geographic admitted that melting polar ice caps on Mars puts the prospect of man-made global warming into question. And this week the Daily Mail reported that a lost kingdom lies beneath the North Sea, evidence that sea levels rose dramatically during a period in which man clearly had little impact on global temperatures. In the article, Dr. Richard Bates of the University of St. Andrews, who created an exhibit of artifacts excavated from the submerged land, gave an outstanding quote regarding man-made global warming:

People seem to think rising sea levels are a new thing, but it’s a cycle of Earth's history that has happened many, many times.

The current heat wave may or may not be caused by global warming. But even if it is caused by global warming, that doesn't necessarily mean it's caused by man-made "climate change".

Buried Headlines: July 6, 2012

How fitting that I just posted about a new documentary chronicling the struggles of the long-term unemployed in suburban Long Island. Today's job report shows more of the same: The long-term unemployed simply aren't getting hired back. And think about this: The jobs reports the media cite are from the government. The government, of course, fudges the numbers to make them look better than they are.

Only 80K Hired In June, Less Than New Entrants Into The Job Market

America’s Labor Market Depression Continues

Obama Predicted 5% Unemployment Rate By Now

Dear Jobseeker: Here's Why I Can't Hire You

In other news:

Running Out of Options, Euro Zone May Face A Stark Choice

Crony Capitalism: Obama Signs Bill Banning Roll-Your-Own Cigarette Operations

What Sovereignty? UN Calls For "Billionaires Tax"

The Taxes Are Too Damn High: Financial Giants Are Moving Jobs Off Wall Street

Stossel On Government Education

Point Out The "Housing Bottom" On This Chart

Documentary Chronicles Struggles Of The Long-Term Unemployed

An independent director recently filmed a documentary about the struggles of the long-term unemployed in suburban Long Island. The film reveals the contrast between daily life in the town of Levittown, N.Y, the archetypal American suburb, a place where the word "poverty" previously had no meaning, and the struggles of residents of the town who have looking for a job for up to several years. As a formerly long-term unemployed man (I'm still underemployed), I found one subject's quote particularly poignant: "Having cancer was easier than being unemployed."

Buried Headlines: July 5, 2012

Here it comes.

13,000 Pages Of New Regulations For Obamacare

FLASHBACK: IRS Seeks 4,000 Agents, $303 Million For Obamacare

Obamacare's Hideous History, Recounted

New developments on the mortgage crisis:

Countrywide Issued "VIP" Loans To Buy Congressional Influence

Chris Dodd Was One Recipient

ECOMINOES FLASHBACK: Frank And Dodd Started The Mortgage Crisis, But Not For The Reason You Think

ECOMINOES FLASHBACK: ...And Justice For Dodd (And Frank)

In other news:

Surprise, Surprise: House GOP Slow To Cut Spending

Global Depression: 80% Of The World's Industrial Activity Is Now Contracting

You Can't Make This Up: Barclays Wins Euromoney's Best Bank Awards

Hamming This Home: Taxpayer Loss On GM Bailout Rises To $35 Billion

The Next Housing Bailout Tool: Eminent Domain!

The Pauls' New Crusade: “Internet Freedom”

Lights Go Dim On Another Green Energy Project

Post-Apocalypse Fun: Reporter Golfs The Length Of Detroit

Barclays Fallout Creates Opportunity To Short Financial Stocks

I repackaged my post about the Barclays Libor scandal for publication on Seeking Alpha. This version is written from an investor's perspective. It's a little more analytical than what I published on ECOMINOES, and it includes an important update:

Unless you've been living in a rock, you're no doubt aware that Barclays agreed to a $453 million settlement with British and American regulators to resolve accusations of rigging Libor. The scandal has cost CEO Robert Diamond and COO Jerry del Missier their jobs, which is big news. But there are two hidden bigger stories that, taken together, have significant investment implications.

The first hidden story is that Barclays was just one of several players in the rate rigging conspiracy. In order to rig its offered rate, the bank had to conspire with other banks. And conspire it did, with several mega banks around the world. From BloombergBusinessweek:

The two-year probe, which involves regulators on three continents, has touched as many as 18 financial institutions, including Citigroup (C), Deutsche Bank (DB), HSBC Holdings (HBC), JPMorgan Chase (JPM), and Royal Bank of Scotland Group (RBS). A dozen firms have fired or suspended traders in connection with internal probes looking at whether their employees tried to manipulate Libor.

The number of willing participants in the scheme suggests that the financial crisis did not sufficiently purge the banking industry of its unscrupulous players. Indeed, Bloomberg published Monday a story entitled There's Something Rotten in Banking.

And this brings us to the investment angle: Where there are unscrupulous bankers, there are lawsuits.

The second hidden story is that the settlement has opened the gates to a flood of lawsuits from institutional investors. The complicit banks are going to get hammered, and that's going to badly hurt the financial industry as a whole, which is already one Eurozone default away from implosion. In other words, this would be a good time to short financials, particularly banks that participated in the conspiracy. From Bloomberg:

"We expect that the cost of lawsuits related to Libor manipulation will dwarf the fines imposed on Barclays," said Sandy Chen, a banks analyst at Cenkos Securities Plc in London, who is "penciling in multi-year provisions that could run into the billions."

Hopefully, the media will uncover more about the 18 probed banks. CNNMoney reported on July 3 that Bank of America (BAC) is being investigated. Stay tuned.

Buried Headlines: July 4, 2012

A libertarian believes that one should be able to do what he wishes as long as it doesn't unjustly impede the life, liberty, or pursuit of happiness of another. I'll say it again: Flooding the historically-saturated job market with new workers is an infringement of the liberty and pursuit of happiness of America's 28 million displaced workers.

In California, Immigration Bill Designed As The "Anti-Arizona"

ECOMINOES FLASHBACK: Tough Economic Times Require Moratorium On Immigration

ECOMINOES FLASHBACK: California: The GDP, Budgetary Woes, And Resistance To Austerity Of A PIIGS Nation

In socialism news:

Wealthy Flee France (And Take Their Money) To Escape Socialist Government

Cuba's Raul Castro Visiting Trading Partner China 

Argentina Signs Deals With China's Military

In other news:

Bernanke: "My Goal is to Wreck Social Security"

The Fed And LIBOR - The Biggest Manipulator Of Them All

Good News: European Parliament Throws Out Online "Piracy Pact"

Not Good News For Food Prices: Corn Crop Shrivels

VIDEO: Peter Schiff Argues Against Three Liberals On CNN

Buried Headlines: July 4, 2012 Tyranny Edition

I enjoyed pointing out that most Americans today would oppose the American Revolution and that the Pledge of Allegiance was created by a socialist theocrat as a means of indoctrinating schoolchildren. But look at today's news. What the are people celebrating today? The government we live under now is more oppressive than the British government the Patriots rebelled against!

First, the truth about why the colonists revolted:

Why Did The American Colonists Revolt?

And now, let's look at today's news:

Twitter Shares Info On Gov't Demands For User Data

Government Demands Growing For Twitter User Data

Homeland Security Report Lists "Liberty Lovers" As Terrorists

San Diego Man Stranded After Told On No-Fly List

Midwest Ranchers, Lawmakers Protest Drone Flyovers

And now, let's take a deeper look:

Lamenting The Lost Legacy Of Independence Day

FLASHBACK: President Obama Signs Indefinite Detention Bill Into Law 

ECOMINOES FLASHBACK: Obama The Dictator: A Timeline

FLASHBACK: Homeland Security Warns Of Radicals On Right

ECOMINOES FLASHBACK: Former Technical Director: NSA Collects, Stores, And Data Mines Personally-Identifiable Communications

Yeah.

The Embarrassing History Of The Pledge Of Allegiance

I have to supplement my post regarding the hypocrisy of celebrating Independence Day with the embarrassing truth about the Pledge of Allegiance. The pledge was written during the Progressive Era (read: the beginning of American socialism) by a Christian Socialist named Francis Bellamy. Bellamy opposed capitalism and advocated theocracy in America, and he created the pledge as a component of "patriotic education" (read: indoctrination) in public (read: government) schools. Oh, and the Bellamy Salute associated with the pledge was adopted by the Nazi Party, who admired its imperialistic Roman origins. So think about that as you celebrate "freedom from tyranny" today.

Majority Of Americans Celebrating Independence Day Would Oppose Revolution Today

Independence Day gets me down because I know that the majority of Americans celebrating it disagree with the Founding Fathers' principle of limited government. The colonists declared independence from England because they determined that the British government became misaligned with the economic interests of the colonists and outright oppressive. Our federal government has become equally disconnected from the economic interests of the people and equally oppressive, but, considering everything our government gets away with, I'd wager that few Americans would support a revolution, much less be willing to give their lives to "alter or abolish" the tyranny we see today. So wrap yourselves in the flag today, America. You're insincere.

That to secure these Rights, Governments are instituted among Men, deriving their just Powers from the Consent of the Governed, that whenever any Form of Government becomes destructive of these Ends, it is the Right of the People to alter or to abolish it.

Under-Reported Barclays Story Reveals Two Hidden Bigger Stories

I haven't included Barclays news in the Buried Headlines because I figured that a scandal that affected nearly every loan in the world (almost $400 trillion worth) would have been front page news. I was wrong. The media have been covering the story, but not nearly to the extent they should.

To recap, Barclays agreed to a $453 million settlement with British and American regulators to resolve accusations of rigging the London Interbank Offered Rate, or Libor. This is very significant, as Libor is the benchmark for interest rates on nearly every loan: mortgages, student loans, everything. The scandal has cost CEO Robert Diamond and COO Jerry del Missier their jobs, which is big news. But there are two hidden bigger stories.

The first hidden story is that Barclays was just one of several players in the rate rigging conspiracy. You see, in order to rig its *offered* rate, the bank had to conspire with other banks. And conspire they did, with some several mega banks around the world. From BloombergBusinessweek:

U.S. and U.K. regulators found that Barclays “systematically” attempted to rig the London interbank offered rate, Libor, and the euro interbank rate starting in 2005. The two-year probe, which involves regulators on three continents, has touched as many as 18 financial institutions, including Citigroup (C), Deutsche Bank (DB), HSBC Holdings (HBC), JPMorgan Chase (JPM), and Royal Bank of Scotland Group (RBS). A dozen firms have fired or suspended traders in connection with internal probes looking at whether their employees tried to manipulate Libor.

The number of willing participants in the scheme suggests that the financial crisis did not sufficiently purge the banking industry of its unscrupulous players. Indeed, Bloomberg published Monday a story entitled There’s Something Rotten in Banking.

The second hidden story is that the settlement has opened the gates to a flood of lawsuits from institutional investors. (It would be nice to see class action suits from ordinary people who were foreclosed on or defaulted on their student loans, but that's not going to happen.) Justice for the common man aside, the complicit banks are going to get hammered, and that's going to badly hurt the financial industry as a whole, which is already one Eurozone default away from implosion. From Bloomberg:

“We expect that the cost of lawsuits related to Libor manipulation will dwarf the fines imposed on Barclays,” said Sandy Chen, a banks analyst at Cenkos Securities Plc in London, who is “penciling in multi-year provisions that could run into the billions.”

Hopefully, the media will cover these bigger stories in greater detail as they develop.

Buried Headlines: July 3, 2012

Federal regulations cost the country a countless number of jobs each year. The FDA robbed this humble blogger of a great opportunity with an upstart medical supply company that produced a revolutionary sterilization cabinet. But the EPA is the king of job destruction.

EPA Chief Opens Mouth, Lies: There Has "Never Been A Loss Of Jobs Blamed On The EPA"

But EPA Regulations Will Result In 1.44 Million Job Losses!

We're reminded every day that European-style socialism is unsustainable. Furthermore, we're reminded that a currency union among sovereign nations with disparate standards of living is a ridiculous idea.

Greece To Present Debt Inspectors "Alarming" Data

France Faces Major Test As It Enters "Danger Zone"

Eurozone Unemployment Hits Record High

Biderman On Europe And The Rally: "It's All BS"

In Eric Holder news:

Fast And Furious: Republicans To Challenge Obama’s Executive Privilege In Civil Court

That's Raaaaaacist: African Methodist Episcopal Church Condemns Congress For Contempt Action Against Holder

In other news:

For Businesses, Plenty Of Questions Remain About Obamacare

ECOMINOES FLASHBACK: Washington On The Back Of Small Business

Money Pit: As GM Shares Near Record Low, Taxpayer Loss On Bailout Rises To $35 Billion

8,733,461: Workers On Federal "Disability" Exceed Population Of New York City

Buried Headlines: July 2, 2012

Economic indicators have been running "near recession" since the official "end" of the Great Recession three years ago. I've been saying we've been in recession all along (see this and this), but today's manufacturing report is one of the first official indicators registering recession this year.

We're In Recession, People: US Factory Output At Three-Year Low

In other news:

Too Big To Exist: Are Banks Just "Planning Their Own Demise"?

As US Closes June With $15,856,367,214,324.44 In Federal Debt, Debt/GDP Hits Post WWII High Of 101.5%

ECOMINOES FLASHBACK: Deadbeat Uncle Sam: Bringing Down The Whole Family

Totalitarian America: Secret Service Shuts Down Eric Holder Protest

Totalitarian America 2: Twitter Ordered To Cough Up Occupy User Data

ECOMINOES FLASHBACK: Obama The Dictator: A Timeline

I Feel *So* Much Better: Drone Industry Releases "Ethics Code"

Uber-Expensive "Green Fleet" Sails, Meets Stiff Headwinds In Congress

The "Green" Premium: 620%

D.C. Blackout "Mild Taste of What Electromagnetic Pulse Attack Would Do"?

Massive Blackout: Obama's Stimulus Did Little For Infrastructure

The fact that millions of Americans are still without power is just the latest evidence that America's infrastructure is crumbling despite Obama's uber-Keynesian "economic stimulus" plan. Of course, very little of the nearly $1 trillion stimulus went to infrastructure, outside of "green energy" initiatives that have either gone nowhere or have increased the cost of electricity. So now we pay more for power, only to see charts like this:

Buried Headlines: July 1, 2012

I've said it before: No more of this "Ron Paul or no one" baloney. Obamacare is a direct assault on the middle class and must be repealed. The only way to repeal the greatest tax increase on the middle class in the history of the United States is to defeat the Community Organizer this fall.

WSJ Chief Economist: 75% Of Obamacare Costs Will Fall on Backs of Those Making Less Than $120K a Year

Obama Flashback: Health Care Should “Never Be Purchased With Tax Increases On Middle Class Families”

In Obama news:

Obama Campaign Fundraising Off Heat Wave?

In other news:

Reluctance In Some States Over Medicaid Expansion

Germany Cries: "Europe Is Coming For Our Money", Greece Promptly Obliges

Colombia Decriminalizes Cocaine, Marijuana

I Want My A-M-C: Dish Drops AMC Networks

How Record Heat Wave Is Threatening Key US Crop

Interesting: The Dark (Pool) Truth About What Really Goes On In The Stock Market

The Dark (Pool) Truth About What Really Goes On In The Stock Market: Part 2

If Roberts Was "Playing Chess", He Was Intentionally Violating His Constitutional Oath

On today's Fox News Sunday Washington Post columnist Charles Lane reiterated George Will's controversial argument that Chief Justice Roberts sided with the liberal justices to find the individual mandate constitutional as part of an intricate plot to reign in the Commerce Clause, thereby limiting the expansion of government regulations and the welfare state. Lane, who has followed Roberts for much of his career, knows him as calculating and true to his conservative principles. I suggested that Roberts's medical condition might have affected his thinking, but, after hearing what Lane had to say, I agree that Roberts likely made the bad decision for what he saw as the "greater good". However, if that's the case, that means the Chief Justice intentionally violated the oath he took to uphold the Constitution. If Roberts found the individual mandate to be unconstitutional, he had a constitutional obligation to write his opinion accordingly.

A Non-Patronizing Word Of Advice From A Formerly Long-Term Unemployed Man

I went through a protracted period of unemployment after earning my MBA (graduated in '08, right in the middle of the financial crisis), and I must say that it was the hardest time of my life. (Indeed, some researches have found that long-term unemployment has an equivalent adverse impact on mood as cancer.) With 28 million displaced workers in this country and approximately half of them with no job at all, chances are some readers of ECOMINOES are unemployed. A few are undoubtedly long-term unemployed as I was. If you're one of the unfortunate few, I'm sure you're sick and tired of being offered patronizing "advice". But I implore you to listen to this.

Avoid isolation at all costs. I made the mistake of spending hours, days, weeks, months, and more searching for jobs alone at home. Don't do that. Studies of inmates in solitary confinement suggest that long periods of isolation create mental health problems in many subjects who had no family history of mental illness. Most commonly, the mental health problems are manifested in loss of what is commonly known as will power. I ended up overeating and smoking heavily. If I had been wise and conducted more of my job search in public places, I likely wouldn't have let myself go like I did.

Long-term unemployment is extremely difficult. But trust me, you can save yourself some pain if you just stay among people.

More Government Meddling, More Mortgage Disaster

I've said it before: Disruptions of the natural relationship between supply and demand almost always lead to disaster. Milton Friedman hammered home this point throughout his career, but modern politicians and economists seem to have forgotten (or never paid attention to) the sage's wisdom.

This week The Washington Times revealed that tax cheats have received $1.4 billion in mortgage assistance from the government ($1.53 billion when factoring the proportion of that amount that the Government borrowed or printed). From the Times:

Tax cheats were given $1.4 billion in government-backed mortgage loans under President Obama’s economic stimulus, and the government doled out at least an additional $27 million in tax credits to delinquents who took the first-time-homebuyer tax break, according to a government audit released Wednesday.

Under government rules, delinquent taxpayers are supposed to be ineligible for the mortgage insurance program unless they have reached a repayment agreement with the Internal Revenue Service. But the Federal Housing Administration didn’t have the right controls to weed out bad applications, said the Government Accountability Office, Congress‘ chief investigative arm.

That meant FHA insured $1.4 billion in mortgages for 6,327 borrowers who collectively owed $77.6 million in unpaid taxes, or an average of more than $12,000 each.

The auditors said that as a category, the tax cheats had foreclosure rates up to three times as high as other borrowers, which meant the delinquent taxpayers exposed the government to even greater risks.

What strikes me about this article is fact that the beneficiary tax cheats had such high rates of foreclosure. You see, if the government had not helped get mortgages for people who had no business owning a home, we likely wouldn't have had a mortgage meltdown (and therefore would never have had the financial crisis and subsequent economic depression). Now, by assisting a group of people who clearly have no business owning a home (foreclosure rates up to three times higher than the historically-high national average?!?), the Government has put the housing market (and, by extension, the economy) at greater risk. This is just one of several boondoggles Washington has created to "help" the housing market recover. You're the best, Uncle Sam!