Tuesday, August 30, 2016

Extra Links

1--Food Price Deflation Cheers Consumers, Hurts Farmers, Grocers and Restaurants

The U.S. is on track this year to post the longest stretch of falling food prices in more than 50 years, a streak that is cheering shoppers at the checkout line but putting a financial strain on farmers and grocery stores.

The trend is being fueled by an excess supply of dairy products, meat, grains and other staples and less demand for many of those same products from China and elsewhere due to the strong dollar. Lower energy costs for transportation and refrigeration also are contributing to sagging food prices, say economists.
“Deflation is a godsend for consumers,” said Bob Goldin, vice chairman of food consultancy Technomic Inc.

Nationwide, the price of a gallon of whole milk on average was down 11% to $3.06 in July over a year ago; the price of a dozen large eggs fell 40% to $1.55 in the same period.

2--More Fed Bond Purchases Are the Wrong Answer

Ms. Yellen doubled-down on Fed asset purchases, suggesting that, in response to a future recession, “policy makers may wish to explore the possibility of purchasing a broader range of assets.”
This idea isn’t unheard of at other central banks, which are buying corporate bonds, regional government bonds and, in the case of the Bank of Japan, 8301 1.69 % even equity and real estate instruments. But other central banks have different boundaries. Fed purchases of a broader range of assets would be an incredible overreach because the asset choices would be highly politicized. Only Congress has the power to appropriate funds and borrow on the credit of the U.S., but broader Fed purchases would come perilously close. The Fed’s $2.3 trillion in liabilities to banks are not covered by the debt limit or other checks and balances, but they should be if the Fed buys new types of assets....

Last week’s Jackson Hole conference of central bankers defended the status quo in monetary policy despite disappointing economic results. Friday’s GDP report revised second-quarter growth down to 1.1%, confirming that the U.S. is suffering its weakest recovery since 1949. This came after the Congressional Budget Office’s new forecasts showing that current policies are expected to generate only 2% GDP growth per year for a decade assuming no recession...

July data from the Bureau of Labor Statistics showing that only 62.8% of people are participating in the labor force. That is barely above the lowest points in the recovery and is three percentage points below the long-term average participation rate, meaning millions of people are being left out by the weak economy....

Ms. Yellen dismissed with a single paragraph the widespread criticism of the Fed’s policies, blaming the poor results on the 2008 crisis. The reality is that Fed policies are causing an immense misallocation of capital toward bond issuers at the expense of small businesses and their workers. Governments have an open tap, and corporate bond issuance is booming, helping bigger companies buy back shares and pay dividends. These borrowers don’t add as much to growth as smaller borrowers.
To fund its bondholdings, the Fed is borrowing trillions of dollars from banks

3--All the new jobs since the beginning of the recovery have been shitty, low-paying, parttime, service sector jobs (archive) The social crisis and the US elections

A new report released this week demonstrates that under first the Bush and then the Obama administrations, the whole structure of employment in America has been radically altered to reduce the status of workers to that of a super-exploited casual and contingent labor force, lacking any job security or health and retirement benefits.

The report, by Princeton University and the RAND Corporation, documents the fact that all net full-time job growth in the US between 2005 and 2015 was accounted for by “alternative work arrangements,” i.e., people working as independent contractors, temps, through contract firms or on-call. There were actually fewer conventional full-time positions—by 400,000—in 2015 than a decade earlier.

One particularly revealing indication of the brutal conditions facing growing sections of workers is the fact that the proportion of contingent workers holding multiple jobs has more than quadrupled over the past 10 years, from 7.3 percent in 2005 to 32 percent in 2015. Nearly one-third of people working with no benefits or job security are holding down an additional part-time or full-time job just to make ends meet.

Another report released this week, this one by the Pew Charitable Trusts, provides further insight into the conditions facing low-income workers that are fueling anti-establishment and anti-capitalist sentiment. Entitled “Household Expenditures and Income,” the study reports that housing costs for the lower third of income groups in the US rose 33 percent between 2013 and 2014, the biggest annual jump in housing spending for the 19 years that Pew has studied the question.

With spending on transportation and food also rising, 2014 became the first year studied by Pew in which median spending on these basic necessities surpassed median income. By 2014, median income had fallen by 13 percent from 2004 levels, while expenditures had increased by 14 percent

The combination of cluelessness and contempt that prevails in top circles was summed up in early March by President Barack Obama following the release of last month’s employment report, which showed a larger-than-expected gain in payrolls for February. Saying the report was a vindication of his economic policies, which had made the US economy “the envy of the world,” Obama derided what he called “an alternative reality out there from some of the political folks that America is down in the dumps.” On the contrary, he gushed, “America is pretty darn great right now.”...

4--US pressures Turkey to curb attacks on Syrian Kurds

5--Turkey must halt Syria incursion

Meanwhile, Iran has voiced its concerns over Turkey’s continued military operations on Syrian soil.
“Increasing the scope of activities in northern Syria will result in the deaths of even more innocent people and civilians. The Turkish army must swiftly put an end to its operations in Syria,” said Iranian Foreign Ministry Spokesman Bahram Qassemi (seen below).

He noted that despite being crucial to regional security, battling terrorism must not breach a nation’s sovereignty and must be carried out in coordination with the nation’s central government.

6--Empty-headed "dumbfuski" Joe Biden visits Turkey

The U.S. is obsessed with stopping the natural gas pipeline from Iran, across Iraq, to Syria’s coastline.  I have written about this subject ad nauseam.  The U.S. would also like to prevent Syria from exploiting  the vast natural gas reservoirs underneath the Mediterranean which will become a billion dollar asset for Gazprom which is already scratching its left palm while waiting for the mayhem to stop.  The only way to bring Syria under control is by breaking it into pieces, as Biden wanted to do with Iraq.  With a Kurdish state reaching from the Turk border down past Al-Hasaka, the projected dimensions of the state might go beyond the natural lines and extend across territory necessary for the pipeline.  With a Kurdish state, the U.S. can have its own military bases to enable the Kurds to protect themselves from the government in Damascus.  Look for the first country at the U.N. to recognize a new Kurdish republic.  ...

The sole purpose of the American presence in Al-Hasaka, a normally halcyonic city with split Syrian/Kurd jurisdiction devoid of any ISIS infestations, is to get the Syrian government out and to push for the federalization of the country as a prelude to the creation of a Kurdish Republic obedient to the United States. 

Biden continues to play stupid, a role for which he is eminently qualified.  That he actually gave the order to support Turk ground troops while playing buddy-buddy with the Kurds only brought into detailed relief the complete breakdown of American foreign policy and its relegation into the hands of trolls

Foreign Ministry: Violations and massacres committed by #Turkish regime are condemned aggressions
Foreign and Expatriates Ministry said on Monday that the violations and massacres committed by the Turkish regime in the Syrian territories form a crime of aggression and crimes against humanity, adding that combating terrorism on the Syrian territories by any side must be done in coordination with the government of the Syrian Arab Republic and the Syrian Arab Army.
“The Turkish army’s air and artillery forces, in coordination with the armed terrorist organizations, targeted the villages of Jub al-Kusa and al-Amarneh to the south of Jarabulus city in Aleppo through shelling randomly, leading to a massacre and killing 35 civilians, 20 of them were killed in Jub al-Kusa and 15 others in al-Amarneh village, in addition to dozens wounded persons,” The Foreign Ministry said in two identical letters sent to the UN Secretary-General and President of Security Council about the bloody ugly massacre committed by the Turkish army in the north of Syria.
“The government of the Syrian Arab Republic condemns, with the strongest terms, the repeated crimes, violations, aggression and massacres perpetrated by the regime in Ankara against the Syrian people, sovereignty and territorial integrity of the Syrian Arab Republic for more than five years,” the two letters affirmed.

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