Monday, June 4, 2012

Today's links


Today's quote: "Stocks have reached what looks like a permanently high plateau." —Irving Fisher, Professor of Economics, Yale University, 1929

1--Prostate cancer drug so effective trial stopped, SFGate

A new drug for advanced prostate cancer patients has proved so effective that researchers stopped the clinical trial early to give all patients a chance to receive the life-extending medication, according to a UCSF-led study released Saturday.

The hormone treatment, Johnson & Johnson's Zytiga, when added to a standard steroid therapy doubled the time it takes for the disease to progress in patients treated with the standard therapy alone, said the lead researcher, Dr. Charles Ryan, associate professor of clinical medicine at the UCSF Helen Diller Family Comprehensive Cancer Center.

The U.S. Food and Drug Administration last year approved Zytiga, also known as abiraterone, for use in men whose prostate cancer had spread to other parts of their body and had already been treated with chemotherapy. The FDA will have to approve it for patients who have not had chemotherapy before it can be marketed for broader use.
This trial focused on patients whose cancer had metastasized, may have been treated with other hormone therapies but had not yet gone through chemotherapy. The interim results are to be presented Saturday at the American Society of Clinical Oncology's annual meeting in Chicago.

2--Why China grows so fast, Big Picture

3--Last week's "downers", The Big Picture

1) May Payrolls grow only 69k after just 77k in April, well below expectations of 150k. Likely again some weather give back but US economy clearly slowing.

2) ISM mfr’g at 53.5, slightly below expectations of 53.8 but not as bad as feared and ISM puts positive spin on mfr’g.

3) April Pending Home Sales fall 5.5% vs the est of flat and comes after cumulative 16.3% in unusual Oct thru Mar fall/winter.

4) Refi and purchase apps fall even with another new drop in mortgage rates.

5) Conference Bd Consumer Confidence falls to 4 month low.

6) Spanish and Italian yields again higher, IBEX closes at fresh 9 yr low and MIB just 100+ pts from Mar ’09 low.

7) Euro zone unemployment at 11% in April, unchanged with Mar.

8) China mfr’g PMI falls to 50.4 from 53.3 and PMI’s in India, South Korea and Taiwan fall slightly.

9) India’s Q1 GDP grows only 5.3%, the slowest in 10 yrs.

10) Fallout from China’s slowdown, Hong Kong’s April retail sales rise less than expected.


4--Secret ‘Kill List’ Proves a Test of Obama’s Principles and Will, NY Times

A few sharp-eyed observers inside and outside the government understood what the public did not. Without showing his hand, Mr. Obama had preserved three major policies — rendition, military commissions and indefinite detention — that have been targets of human rights groups since the 2001 terrorist attacks. ...

The Use of Force

It is the strangest of bureaucratic rituals: Every week or so, more than 100 members of the government’s sprawling national security apparatus gather, by secure video teleconference, to pore over terrorist suspects’ biographies and recommend to the president who should be the next to die.

This secret “nominations” process is an invention of the Obama administration, a grim debating society that vets the PowerPoint slides bearing the names, aliases and life stories of suspected members of Al Qaeda’s branch in Yemen or its allies in Somalia’s Shabab militia...

Yet the administration’s very success at killing terrorism suspects has been shadowed by a suspicion: that Mr. Obama has avoided the complications of detention by deciding, in effect, to take no prisoners alive. While scores of suspects have been killed under Mr. Obama, only one has been taken into American custody, and the president has balked at adding new prisoners to Guantánamo.

“Their policy is to take out high-value targets, versus capturing high-value targets,” said Senator Saxby Chambliss of Georgia, the top Republican on the intelligence committee. “They are not going to advertise that, but that’s what they are doing.” ...

But, he said, “secrecy has its costs” and Mr. Obama should open the strike strategy up to public scrutiny.

“This program rests on the personal legitimacy of the president, and that’s not sustainable,” Mr. Hayden said. “I have lived the life of someone taking action on the basis of secret O.L.C. memos, and it ain’t a good life. Democracies do not make war on the basis of legal memos locked in a D.O.J. safe.” ...

Moreover, Mr. Obama’s record has not drawn anything like the sweeping criticism from allies that his predecessor faced. John B. Bellinger III, a top national security lawyer under the Bush administration, said that was because Mr. Obama’s liberal reputation and “softer packaging” have protected him. “After the global outrage over Guantánamo, it’s remarkable that the rest of the world has looked the other way while the Obama administration has conducted hundreds of drone strikes in several different countries, including killing at least some civilians,” said Mr. Bellinger, who supports the strikes.


5--Merkel Rejects Debt Sharing as Obama Urges End to Crisis Cloud, Bloomberg

German Chancellor Angela Merkel hardened her opposition to joint debt sharing in the euro region as President Barack Obama singled out Europe’s leaders for not doing enough to arrest the financial crisis.

With Europe’s debt crisis cited last week for canceled IPOs, weaker-than-expected Chinese manufacturing figures and a rise in the U.S. jobless rate, Merkel rejected joint debt issuance in the 17-nation euro area as a solution, saying “under no circumstances” would she agree to Germany-backed euro bonds

Now, some “come along and ask for euro bonds, saying all we need are equal interest rates and everything will turn out all right,” Merkel said in a speech to members of her Christian Democratic Union in Berlin yesterday. Instead, what’s needed is an economic overhaul to tackle the lack of competitiveness in Europe, she said.

6--The jobs stall, Robert Reich

Not only has the unemployment rate risen for the first time in almost a year, to 8.2 percent, but, more ominously, May's payroll survey showed that employers created only 69,000 net new jobs. The Labor Department's Bureau of Labor Statistics also revised its March and April reports downward. Only 96,000 new jobs have been created, on average, over the last three months.

Put this into perspective. Between December and February, the economy added an average of 252,000 jobs each month. To go from 252,000 to 96,000, on average, is a terrible slide. At least 125,000 jobs are needed a month merely to keep up with the growth in the working-age population available to work.

Face it: The jobs recovery has stalled.

What's going on? Part of the problem is the rest of the world. Europe is in the throes of a debt crisis and spiraling toward recession. China and India are slowing. Developing nations such as Brazil, dependent on exports to China, are feeling the effects and they're slowing as well. All this takes a toll on U.S. exports.

But a bigger part of the problem is right here in the United States, and it's clearly on the demand side of the equation. Big companies are still sitting on a huge pile of cash. They won't invest it in new jobs because American consumers aren't buying enough to justify the risk and expense of doing so.

7--Why Stocks Declined in May, Trim Tabs

I did a video May 8 entitled Sell in May and Then Go Away, in which I suggested that stocks this May would sell off for the third straight May. I was right. US stocks are down over 4% since then. The reason for the decline this May is pretty much the same as in May 2010 and May 2011. It is all about supply and demand: More shares chasing less money.

The financial media has more obvious reasons for the declines. This year’s drop is due to Europe and the Facebook debacle. Last years plunge reportedly was also due to Europe and May 2010 was obviously due to the flash crash.

To repeat the real reason is simply supply and demand. Investors are fleeing US stocks. Up until May companies had been buying back almost $2 billion of their own shares, more then were sold each and every trading day since the beginning of last summer. That ended in May where companies sold over $25 billion more shares than they bought.

To repeat everybody is now a seller of US stocks. US equity mutual funds, hedge funds and pension funds are all selling US stocks and now companies are also. As I see it, stock prices are likely to keep dropping until the Federal Reserve announces the next round of stimulus. That announcement should create a very sharp and loud rally in stock prices. Unfortunately whatever the Fed does will not work, but it will create a stock market rally.

Never the less, the Federal Reserve will go on predicting that economic growth will pick up. Both US presidential candidates will promise if elected economic growth will accelerate. What bull shit.

Where we are now as a world is where it is OK for governments and bankers to lie about reality. Governments tell us that we can afford to pay government workers all their pension and health benefits, in addition to Social Security and Medicare. They lie. The truth is that even when all the laws were passed and pension deals were cut, lawmakers had to know that there is no way that we could ever pay out all the benefits we have promised to everyone.

Banks are lying about the quality of the loans on their books. If they told the truth the banks would go bust and the bankers would lose their jobs. Japanese banks started that trend in the early1990s by refusing to write off bad loans. What happened to Japan as a result? The Japanese economy has not grown ever since. But the bankers kept their jobs. In Europe today there is no way most of the banks would survive if they wrote off all their bad loans. The solution? Euro bankers and European officials solution lie about what is really happening. In other words, delay and pray.

8--Capital flight in Spain, FT Alphaville

Spain is leaking capital. Data from the Bank of Spain released yesterday showed that almost €100bn has left the country in the first three months of the year..

Spanish bank deposits from the nonbank private sector continued to decline. The fall in 1Q12 was €23bn, while April’s €32bn drop was partly due to the volatile nonbank financial intermediaries, rather than just households and/or corporates. ...

Hence, foreigners are pulling out of Spain, but whether domestic residents are abruptly shifting funds abroad is still less clear based on these data. ... But, for now, the main driver appears to be capital rather than deposit flight, and it appears to be driven by foreigners rather than Spanish residents.


9--Obama’s role in the selection of drone missile targets, WSWS

In the end, Obama selects most of the victims. He “signs off on every strike in Yemen and Somalia and also on the more complex and risky strikes in Pakistan—about a third of the total,” according to the Times.

Thus, when one sees or hears news accounts of “suspected militants” being slain in a drone missile strike—or the less frequent follow-up stories revealing that the “militants” were in fact unarmed men, women and children—it can be assumed that Obama personally ordered the killings.

The article is not an exposé. It appears to have been commissioned by the administration itself as part of his re-election campaign’s attempt to run Obama as the unflinching commander-in-chief in the “war on terror,” touting the supposed success of his assassination program and outflanking the Republicans from the right.

The authors note that the article is based upon interviews with “three dozen of his [Obama’s] current and former advisers,” who were clearly authorized and encouraged to talk about the president’s immersion in state murders.....

There is clearly an element of personal psychology in Obama’s evolution. If he personally directs state killings, it is in part because he enjoys it. The Times reports: “Asked what surprised him most about Mr. Obama, Mr. [Thomas] Donilon, the national security adviser, answered immediately: ‘He’s a president who is quite comfortable with the use of force on behalf of the United States.’”

The secret of Obama’s “principles” is that he has none. A political chameleon without independent ideas, democratic convictions or moral scruples, Obama’s personality is that of a bureaucratic state functionary. He identifies himself with the military and intelligence apparatus that he officially “commands,” always under the watchful eye of his counterterrorism advisor, the former CIA official John Brennan.

More important than what the state killing program says about Obama personally, however, is what it exposes about the ruling political establishment as a whole. It testifies to the wholesale repudiation of core constitutional principles at the highest levels and a real political and moral breakdown of the entire US government.

If the assassination of an American citizen is “easy”, of what crimes are this president and his administration not capable? Clearly, the institutionalization of kill lists, targeting committees and fascistic justifications for state murder have profound implications at home as well as abroad.

10--Euro zone unemployment hits record high, seen rising, Reuters

 Euro zone unemployment has hit a record high, and job losses are likely to keep climbing as the bloc's devastating debt crisis eats away at businesses' ability to hire workers while indebted governments continue to cut staff.

Around 17.4 million people were out of work in the 17-nation euro zone in April, or 11 percent of the working population, the highest level since records began in 1995, the EU's statistics office Eurostat said on Friday.

"This 11 percent level is going to continue edging up in the coming months and probably until the end of the year," said Francois Cabau, an economist at Barclays Capital who sees the euro zone's economy contracting 0.1 percent this year.

11--GREECE. SYRIZA's Proposals: The Exit From the Crisis Is On the Left, Global Research

1. Creation of a shield to protect society against the crisis:

Not a single citizen without a guaranteed minimum income or unemployment benefit, medical care, social protection, housing, and access to all services of public utilities.

Protection of and relief measures for indebted households.
Price controls and price reductions, VAT reduction, and abolition of VAT on basic-need goods

We are asking immediately for:

A moratorium on debt servicing.

Negotiations for debt cancellation, with provisions for the protection of social insurance funds and small savers. This will be pursued by exploiting any available means, such as audit control and suspension of payments.

Regulation of the remaining debt to include provisions for economic development and employment.
European regulations on the debt of European states.
Radical changes to the European Central Bank's role.
Prohibition of speculative banking products.
A pan-European tax on wealth, financial transactions, and profits.

3. Income redistribution, taxation of wealth, and elimination of unnecessary expenses:

Reorganization and consolidation of tax collection mechanisms.
Taxation of fortunes over 1-million euros and large-scale revenues.
Gradual increase, up to 45%, of the tax on the distributed profits of corporations (SA).

Taxation of financial transactions.
Special taxation on consumption of luxury goods.
Removal of tax exemptions for ship owners and the Greek Orthodox Church.

Lifting of confidentiality for banking and merchant transactions, and pursuit of those who evade taxes and social insurance contributions.

Banning of transactions carried out through offshore companies.
Pursuit of new financial resources through efficient absorption of European funds, through claims on the payment of German World War II reparations and occupation loan, and finally via steep reductions in military expenses.

4. Productive social and environmental reconstruction:

Nationalization/socialization of banks, and their integration into a public banking system under social and workers’ control, in order to serve developmental purposes. The scandalous recapitalization of the banks must stop immediately.

Nationalization of all public enterprises of strategic importance that have been privatized so far. Administration of public enterprises based on transparency, social control, and democratic planning. Support for the provision of Public Goods.

Protection and consolidation of co-operatives and SMEs in the social sector.

Ecological transformation in development of energy production, manufacturing, tourism, and agriculture. These reforms will prioritize nutritional abundance and fulfillment of social needs.

Development of scientific research and productive specialization.

5. Stable employment with decent wages and social insurance:

The constant degradation of labour rights, coupled with embarrassing wage levels, does not attract investment, development, or employment.

Instead, we are calling for:

Well-paid, well-regulated, and insured employment.

Immediate reconstitution of the minimum wage, and reconstitution of real wages within three years.
Immediate reconstitution of collective labour agreements.
Instigation of powerful control mechanisms that will protect employment.
Systematic opposition of lay-offs and the deregulation of labour relations.

6. Deepening Democracy: democratic political and social rights for all:

There is a democratic deficit in the country. Greece is gradually being transformed into an authoritarian police state.

We are calling for:

The restoration of popular sovereignty and an upgrade of parliamentary power within the political system:
Creation of a proportional electoral system

Separation of powers
Revocation of ministerial immunity
Abolishment of economic privileges for MPs
Real decentralization to create local government with sound resources and expanded jurisdiction.
The introduction of direct democracy and institutions of self-management under workers’ and social control at all levels.
Measures against political and economic corruption.
The solidification of democratic, political, and trade union rights.
The enhancement of women's and youths’ rights in the family, in employment, and in public administration.

Immigration reforms:
Speeding up the asylum process
Abolition of Dublin II regulations and granting of travel papers to immigrants
Social inclusion of immigrants and equal rights protection
Democratic reforms to public administration with the active participation of civil servants.

The demilitarization and democratization of the Police and the Coast Guard. Disbandment of special forces.

7. Restoration of a strong welfare state:

Anti-insurance laws, the shutdown of social services, and the steep fall in social expenditures under the Memorandum have turned Greece into a country where social injustice reigns.
We are in need of:
An immediate rescue of the pension system, to include tripartite financing and the gradual consolidation of separate pension fund portfolios into one public, universal system of social insurance.

A raise in unemployment benefits until the substitution rate reaches 80% of the wage. No unemployed person is to be left without unemployment benefits.
The introduction of a guaranteed minimum income.
A unified system of comprehensive social protection covering the vulnerable social strata.

8. Health is a Public Good and a social right:

Health care is to be provided for free and will be financed through a Public Health System. Immediate measures include:

Support and upgrades for hospitals. Upgrade of health infrastructures of the Social Insurance Institute (IKA). Development of an integrated system of first-level medical care.

Covering the needs of medical treatment in both personnel and equipment, in part by stopping lay-offs.
Open and cost-free access to medical treatment for all residents in the country.
Free pharmaceutical treatment and medical examinations for low-income pensioners, the unemployed, students, and those suffering from chronic diseases.

9. Protection of public education, research, culture, and sports from the Memorandum's policies:
With regards to education, we are calling for:

Consolidation of universal, public, and free education, including coverage of its urgent needs in infrastructure and personnel at all three levels.
Compulsory 14-year unified education.
Revocation of the Diamantopoulou Law.
Assurance of self-government for Universities.
Preservation of the academic and public character of Universities.

10. An independent foreign policy committed to the promotion of peace:
The capitulation of our foreign policy to the desires of the U.S. and the powerful states of the European Union endangers the country's independence, peace, and security.
We propose:
A multi-dimensional and peace-seeking foreign policy.
Disengagement from NATO and closure of foreign military bases on Greek soil.
Termination of military cooperation with Israel. Aiding the Cypriot people in the reunification of the island.

Furthermore, on the basis of international law and the principle of peaceful conflict resolution, we will pursue improvements in Greek-Turkish relations, a solution to the problem of FYROM's official name, and the specification of Greece's Exclusive Economic Zone.

The incumbent economic and social system has failed and we must overthrow it!
The economic crisis that is rocking global capitalism has shattered the illusions. More and more, people understand that capitalist speculation is an inhuman organizational principle for modern society. It is also widely acknowledged that the private banks function only for the benefit of the bankers, harming the rest of the people. Big business and bankers absorb billions of euros from health care, education, and pensions.

An exit from the crisis requires bold measures that will prevent those who created the crisis from continuing their destructive work. We are endorsing a new model for the production and distribution of wealth, one that will include society in its totality. In this respect, the large capitalist property is to be made public and managed democratically along social and ecological criteria. Our strategic aim is socialism with democracy, a system in which all will be entitled to participate in the decision-making process.

We are changing the future; we are pushing them into the past!

We can prevail by forging unity and creating a new coalition for power with the Left as a cornerstone. Our strength in this endeavour is the alliance of the People: the inspiration, the creative effort, and the struggle of the working people. With these, we will shape the lives and the future of a self-governed people.

Now the vote is in the hands of the People! Now the People have the power!

In this new election, the Greek people can and must vote against the regime of the Memoranda and the Troika, thus turning over a new page of hope and optimism for the future.

For Greece and for Europe, the solution is with the Left













































































































































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