Mysterious Danish Group Builds Exotic Compound on Baja Coast
February 5th, 2010This is a weird one.
Via: San Diego Reader:
Tvind Alert says that the complex cost $10 million to build. The watchdog website says that a Mexican-Danish company bought the land from local landowners between 1999 and 2003. Attorney Morachis informed me that the landowner is a Mexican company. Allegations have been made that title to some of the property was improperly obtained and that ownership by the Teachers Group violates Mexican laws of foreign ownership of coastal land, but TG Pacifico’s lawyers say that the title and ownership are sound.
The property is said to encompass 740 hectares (1828 acres). Morachis remarked in an interview appearing in 2005 in Skyscrapercity.com, a building and architecture website, that “the developers chose this site for its tranquility.” Tvind Alert says the development includes housing for 300 staff, “complete with boardroom, exhibition space, gymnasium, squash courts, Olympic-sized swimming pool and helipad.” Several local people spoke of the luxuriousness of the compound. The Zeta article refers to “tile from Puebla, pottery from Tlaxcala and marble from Durango.”
The French government has officially designated Humana as a cult, while some of Tvind’s critics, as well as Danish prosecutors, have called Tvind a secular religion. Several buildings have a modern ecclesiastical look: identical-looking ones at the northern and southern ends of the compound resemble cathedrals, with nave and narthex. One space has the appearance of a sanctuary. An obelisk-like monument is portentous and enigmatic. “From what we can see in the photos, the building complex near Pulgas deserves to be applauded for its design, if not for its function,” comments Thomas Williamson, a retired San Diego architect and former assistant professor of architecture at Stanford University, whom I asked for a review of Utzon’s creation.
More: Tvind Alert
Related: Sinister Sites
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Ex-BofA Chief Lewis Charged with Fraud
February 5th, 2010Via: CNN:
New York Attorney General Andrew Cuomo said Thursday it was bringing civil charges against senior Bank of America executives, including former company CEO Ken Lewis, for their role in the company’s controversial purchase of Merrill Lynch.
Separately, the Securities and Exchange Commission said it had struck a $150 million settlement agreement with BofA over its decision to pay billions of dollars in bonuses to former Merrill employees.
Bank of America’s last-minute decision to purchase the ailing Merrill in September 2008 has remained a central issue in the wake of the financial crisis, prompting both federal and state probes into the matter.
Cuomo’s office, which has been aggressively pursuing an investigation into the merger and subsequent bonuses paid to former Merrill employees, said it was charging Lewis and Bank of America’s former chief financial officer Joe Price with fraud.
The lawsuit contends that the bank’s management team understated the losses at Merrill in order to get shareholders to approve the deal, then subsequently overstated the firm’s willingness to terminate the merger to regulators weeks later in order to get $20 billion of additional aid from the federal government.
“Bank of America and its officials defrauded the government and the taxpayers at a very difficult and sensitive time,” Cuomo said at a press conference Thursday, joined by federal bailout cop Neil Barofsky, whose office aided in the investigation. “I believe that Bank of America officials exploited this fear.”
A spokesperson for Bank of America called the charges “regrettable” and “totally without merit,” adding that both Lewis and Price acted in good faith at all times and were “consistent with their legal and fiduciary obligations.”
Potential for Financial Emergency in Europe
February 5th, 2010WARNING: This is not a recommendation to buy, sell or hold any financial instrument.
Update: Dollar: Next Leg Up
80.240
—End Update—
We need to watch Portugal, Spain and Greece closely. The sovereign debt situation could easily get out of control.
I’m watching EUR/USD as the proxy for the situation. On faster intraday periods, EUR/USD is firming, and USDX is hesitating at the 80 level with several indicators describing lower pivot highs as the index climbs. In other words, a tactical pullback in the dollar is likely before an attempt to get a handhold over 80 is attempted again. This is a very tactical assessment.
Currently, the major Asian markets are down in the 2% to 3% range. I’ll update as necessary as we move into regular market hours in Europe.
Fears Rise of Euro Government Default
Via: Wall Street Journal:
Financial markets swooned Thursday amid rising fears of a government debt default in Europe, highlighting the seriousness of the challenges facing the euro currency as fiscally challenged countries like Greece, Portugal and Spain dig themselves out of debt.
After a brief respite early this week, the cost of insuring against default the debt of euro-zone members with large budget deficits jumped late Wednesday and rattled investors more broadly on Thursday.
While Greece and Portugal have felt investors’ fire in recent days, now even larger economies like Spain are starting to come under pressure from worries about their weakened public finances.
Blue-chip stock indexes in Spain and Portugal slumped nearly 6% and 5%, respectively, while an index of Europe’s 600 biggest companies dropped 2.7%. The euro sank more than 1% against the U.S. dollar to an eight-month low of $1.3727 and lost 3% of its value against the Japanese yen.
The global economic downturn, and extensive government spending to fight it, have led to major fiscal problems in Europe, especially for less-dynamic economies like Greece, Portugal, Ireland and Spain. Such countries took advantage of their membership in the 16-nation euro bloc during the boom by borrowing at unusually low interest rates. But now, investors are worried about how they will reduce yawning budget deficits that exceed 12% of their economic output in the case of Greece and Ireland.
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Portugal Near Political Crisis Over Debt
Via: Financial Times:
Portugal moved towards a political crisis on Thursday night as its finance minister appealed to opposition parties not to defeat the minority Socialist government over a regional finance bill that he said would undermine the country’s international credibility.
In a televised address, Fernando Teixeira dos Santos said opposition proposals to allow the Portuguese islands of Madeira and the Azores to increase their debt would have “grave consequences for Portugal’s public accounts” and send “the worst possible message” to financial markets.
His warning came as Portuguese bonds and shares came under fire for the second day running as concerns over sovereign debt spread from Greece to other high-deficit countries in the eurozone.
The Lisbon stock market fell almost 5 per cent on Thursday, the biggest daily fall since November 2008, and bond yields rose to new highs amid doubts over the ability of Portugal to consolidate its public accounts.
The cost of insuring Portuguese debt against default also rose to a record high.
The U.S. Industrial Organic Milk Swindle
February 4th, 2010Via: Politics of the Plate:
On some bureaucrat’s desk in President Obama’s Office of Management and Budget (OMB), sits a document that has the power to either destroy the nation’s 1,800 family-operated organic dairy farms or come to their rescue.
In the early 2000s, virtually all of the nation’s organic dairy farmers—not to mention the millions of consumers willing to pay a premium for organic products—agreed that milk certified as organic by the United States Department of Agriculture had to come from cows that had access to pasture.
As government regulations go, it sounds pretty straightforward: room to roam, clean air to breathe, fresh grass to eat. And that was the general consensus on what the National Organic Standards required.
But beginning in the mid-2000s, at about the time when it became evident that the green “USDA Organic” label translated into bigger profits, huge Confined Animal Feeding Operations (CAFOs) with herds of up to 10,000 cows located in western states got into the organic milk business.
There was one obvious problem. How do you provide pasture for thousands of hungry cows in a semi-arid landscape that would, at best, produce enough feed for a few dozen animals?
Research Credit: SW
Next in Line for a Bailout: Social Security
February 4th, 2010Via: Fortune:
Don’t look now. But even as the bank bailout is winding down, another huge bailout is starting, this time for the Social Security system.
A report from the Congressional Budget Office shows that for the first time in 25 years, Social Security is taking in less in taxes than it is spending on benefits.
Instead of helping to finance the rest of the government, as it has done for decades, our nation’s biggest social program needs help from the Treasury to keep benefit checks from bouncing — in other words, a taxpayer bailout.
No one has officially announced that Social Security will be cash-negative this year. But you can figure it out for yourself, as I did, by comparing two numbers in the recent federal budget update that the nonpartisan CBO issued last week.
The first number is $120 billion, the interest that Social Security will earn on its trust fund in fiscal 2010 (see page 74 of the CBO report). The second is $92 billion, the overall Social Security surplus for fiscal 2010 (see page 116).
This means that without the interest income, Social Security will be $28 billion in the hole this fiscal year, which ends Sept. 30.
Why disregard the interest? Because as people like me have said repeatedly over the years, the interest, which consists of Treasury IOUs that the Social Security trust fund gets on its holdings of government securities, doesn’t provide Social Security with any cash that it can use to pay its bills. The interest is merely an accounting entry with no economic significance.
Social Security hasn’t been cash-negative since the early 1980s, when it came so close to running out of money that it was making plans to stop sending out benefit checks. That led to the famous Greenspan Commission report, which recommended trimming benefits and raising taxes, which Congress did. Those actions produced hefty cash surpluses, which until this year have helped finance the rest of the government.
But even then, it was clear the surpluses would be temporary. Now, years earlier than projected, Social Security is adding to the government’s borrowing needs, even though the program still shows a surplus on paper.
Gold Hits Three Month Low; EUR/USD Seven Month Low
February 4th, 2010Via: Reuters:
Gold tumbled 3.8 percent to a three-month low in Europe on Thursday as the euro hit its weakest in seven months against the dollar, pushing the precious metal through key technical support levels.
Other precious metals also fell, with silver sliding more than 5 percent to its lowest since September, platinum dropping more than 3 percent and palladium down nearly 4 percent.
Spot gold fell to a low of $1,066.30 an ounce and was bid at $1,074.30 an ounce at 1538 GMT, against $1,108.85 late in New York on Wednesday.
U.S. gold futures for February delivery on the COMEX division of the New York Mercantile Exchange fell $36.20 to $1,075.20.
One in Five Children in New York City Relying on Emergency Food Aid
February 4th, 2010Via: NBC New York:
One in eight Americans needed emergency food help in 2009—–one of five children in New York City are relying on emergency food.
These sad statistics come from Feeding America and the Food Bank for New York City.
“Food insecure” is the bureaucratic term for hungry people — and New York is, unfortunately, a textbook case in food insecurity. Our food pantries and soup kitchens are overloaded. Yet, without a healthy infusion of federal stimulus money, it could be a lot worse. So says Joel Berg, executive director of the NYC Coalition Against Hunger.
Berg says 37% of South Bronx residents had trouble affording food in the last year. “The federal stimulus money is helping us avert disaster,” Berg continued. “We are fortunate to have that money at this time.”
Nonetheless, as Berg sees it: “New Yorkers with children are among the most vulnerable to food poverty. About 20 percent of all New York City households with children have difficulty affording enough food. A staggering one in five of the city’s children, 297,000 small people, rely on soup kitchens and pantries—up 18 percent since 2004.”
Sim City Baghdad
February 4th, 2010Via: On The Media:
The U.S. Army has long used video games to train troops in conventional warfare. But the wars in Iraq and Afghanistan are anything but conventional. US troops fighting insurgencies need a unique skill set, one they’re learning from a simulator that resembles the popular game SimCity. Kim LeMasters, creative director of the Institute for Creative Technologies, describes how UrbanSim works.
GOLD WHACKED
February 4th, 2010WARNING: This is not a recommendation to buy, sell or hold any financial instrument.
Spot is 1074.80 x 1075.80 right now, down $34.50. That $1075 support area was breached and it hit $1064.10, which is a support area. The next support is right around $1030.
The dollar has round number resistance (80) just overhead and resistance again at 80.528.
