While most people...

...focus on Ryan plan, support for Obamacare is at all-time low -- Philip Klein

--> http://bit.ly/jOALi2

Pelosi decries...

...House Republicans for bringing a Debt Limit increase bill to the floor with no intention to vote for it

As of the end of April...

...the average loan in foreclosure was 567 days past due, which is the longest period on record.

UK consumer recovery set to be slowest in 180 years

By Daniel Pimlott, Economics Reporter
Financial Times

The UK economy is set to experience the slowest pick-up in consumer spending of any post-recession period since 1830, according to a Financial Times analysis of official forecasts.

Families are expected to spend just slightly more by 2015 than they were before the financial crisis hit in 2008, as high inflation, tax rises and slow wage growth eat into disposable incomes.

In the 18 major recessions since records began in 1830, Bank of England data show that consumer spending on average recovered to 12 per cent above its previous peak within seven years.

But according to forecasts from the Office for Budget Responsibility, spending in 2015 will be just 5.4 per cent above the 2008 peak, making it the slowest recovery of any comparable post-recession period. At the equivalent stage after recessions in the early 1980s and 1990s, spending was 20 per cent and 15 per cent higher respectively.

"The recession may have been relatively benign for households, but the recovery is going to be particularly awful," said Simon Kirby, an economist at the National Institute for Economic and Social Research. British consumers have not experienced such a slow recovery in their spending power since 1970s-era stagflation. A period of stagnant spending growth could mean that consumers will barely feel the difference even as the economy expands.

"Everyone will hear and read about the economy growing in the news, its just that households are not going to notice it," said Mr Kirby.

While the UK labour market has been surprisingly strong, both the Bank of England and the Treasury say that stronger export growth and business investment is still needed to offset the fall in consumer and government spending.

"The only sustainable recovery is the kind of recovery that rebalances away from consumer demand and towards external demand," said one Treasury aide.

It is unclear, however, whether trade and business investment will prove sufficient to offset weak consumer spending and public sector cuts – which together account for more than 85 per cent of the economy

Supreme Court rules...

...that a U.S. Muslim can't sue former AG John Ashcroft over post-9/11 detention

Adjusted for inflation...

...housing prices are now back to late 1999 levels. (IHS Global)

It's been 15 years...

...since corn & soybean farmers will have this much left to plant in June

Technology Sector...

...Leads S&P 500 today with 80% of names in sector up on day

Basic Materials the weakest

Bill

This country's future...

...Depends on Natural Gas, Nuclear and Oil. It is that simple

We need to continue to research how to make them as safe and clean as possible and stop pretending that wind and solar are going to scale to meet our needs

Wind, Solar, and Conservation unfortunately do not add up to and energy policy for a large, growing, industrialized nation

'Muslim Brothers using mosques as party branches'

Jerusalem Post

The Muslim Brotherhood in Egypt is using mosques as the headquarters of
its party branches, and the organization is gradually seeking to create a Shari'a-based state, former Mossad chief Shabtai Shavit warned on Tuesday

Article-->http://www.jpost.com/DiplomacyAndPolitics/Article.aspx?id=223026

In bemoaning the pain of fiscal responsibility, the Democrats show they still haven't learned the lessons of Europe

In bemoaning the pain of fiscal responsibility, the Democrats show they
still haven't learned the lessons of Europe


Greece, Ireland, and Portugal-the three countries committed to austerity
programs as conditions for European and International Monetary Fund
bailouts-have shrunk over the past year. The unemployment rate is above
10 percent in all three. Meanwhile, the U.K. economy is growing sluggishly. But to infer from this that the United States can postpone serious attempts at fiscal stabilization would be completely wrong-and deeply dangerous.

The point is that Greece & Co. are in trouble because of excessive borrowing. Between 1999 and 2010 the structural deficit of the Greek government rose from 2 percent of gross domestic product to nearly 18 percent. Ireland went from surplus to minus 11 percent.

Portugal was little better. The result was a debt explosion. The net government debt of Greece, the worst offender, soared from 76 percent of GDP to 142
percent last year.

Article-->http://www.newsweek.com/2011/05/29/austerity-works.html

Question of the Day

Was President Obama disrespectful when as Commander in Chief, he decided to play golf on Memorial Day?

Intrade's implied chances, GOP nomination

Romney. 29%
Pawlenty. 19%
Huntsman. 17%
Palin. 8%
Perry. 6%
Bachmann. 5%
Cain. 4%

Rasmussen's...

...Daily Presidential approval at 48% is the lowest in 10 days

Gasoline future...

...Highest since May 10

Consensus...

...For Non Farm payrolls later this week is +180K. If that was the actual it would be the lowest in 4 months

The Unemployment rate is forecast to tick down to 8.9% from 9.0%

"The Chinese government

...has completed a study on converting at least some of its U.S. debt holdings, including U.S. Treasury securities, into
equities, the official Economic Information Daily reported, citing a
former central bank researcher

'We need to safeguard and increase the value of our investments in America. Debt holdings in this case means all kinds of bonds, including U.S. Treasury bonds,'

Consumer Confidence...

...At 60.8 is the lowest since last November

Reelecting Obama (Victor Davis Hanson)

We are beginning to see the contours of the upcoming 2012 reelection campaign of Barack Obama. Whether always officially sanctioned or not, Obama's campaign will focus on three general themes: a) the 2008 meltdown of the economy on Bush's watch; b)conservative heartlessness. in gutting cherished entitlement programs; and c) racial bias behind any criticism of Barack Obama. By any standard, the economy has remained mostly dismal for well over two years. Deficits, joblessness, fuel
prices, average GDP growth, and housing are far worse than the average
during the eight years of Bush's presidency

Article-->

http://www.nationalreview.com/articles/268416/reelecting-obama-victor-davis-hanson

China's largest inland lake dries up as country battles drought

The volume of water in Poyang lake in Jiangxi province, normally 100 miles-long and 10 miles-wide, is now a tenth of its normal level, according to Xinhua, the Chinese state news agency. Fishing boats and house boats have been left stranded on a vast stretch of the lake bed, now a lush grassland. The drought, which has seen no rainfall for two months, has struck the central Chinese provinces that are known as the country's "home of rice and fish".

Article-->http://www.telegraph.co.uk/news/worldnews/asia/china/8546673/Chinas-largest-inland-lake-dries-up-as-country-battles-drought.html

Crude Oil Future...

...Highest since May 11

Following months of talks...

...Germany now appears ready to drop demands it has made in order to allow Greece to "restructure" its debt and prevent it from running out of Cash out of the Summer

US stock index futures...

...Strong before open after Europe and Asia rally

Crude Oil future...

...Back over 102

The human race...

...divides politically into those who want people to be controlled and those who have no such desire. --Heinlein

Canadian Raw Materials...

...Price Index (Apr) M/M 6.8% vs. Exp. 3.0% (Prev. 5.7% Rev. 5.8%)

Remember that dollar rally?

If you look at Swiss Franc, it's totally non-existent. --graystonetrader

Eurozone inflation...

...Falls to 2.7%

Today the House considers..m

...HR 1954 - To implement President's request to increase the debt limit by $2.4 trillion to $16.7 T

Americans...

...Consume 80% of the pain killers produced globally

Britain faces bleak two years after feeble economic growth

Britain faces a bleak time for the next two years as a result of feeble economic growth, one of the Bank of England’s most senior officials warned on Friday night.

Spencer Dale, the Bank’s chief economist, said households would need to consume less and he indicated that interest rates would rise this year.

He said he was worried about the persistently high levels of inflation and the weakness of the economic recovery. Mr Dale said that there were “relatively hard times ahead”.

-->Article in Telegraph

Pro-Obama media always shocked by bad economic news Read more at the Washington Examiner: http://washingtonexaminer.com/politics/2011/05/pro-obama-media-always-shocked-bad-economic-news#ixzz1NlQ6b3a8

Unexpectedly!

As megablogger Glenn Reynolds, aka Instapundit, has noted with amusement, the word "unexpectedly" or variants thereon keep cropping up in mainstream media stories about the economy.

"New U.S. claims for unemployment benefits unexpectedly climbed," reported CNBC.com May 25.

"Personal consumption fell," Business Insider reported the same day, "when it was expected to rise."

"Durable goods declined 3.6 percent last month," Reuters reported May 25, "worse than economists' expectations."

"Previously owned home sales unexpectedly fall," headlined Bloomberg News May 19.

"U.S. home construction fell unexpectedly in April," wrote the Wall Street Journal May 18.

Read more at the Washington Examiner: http://washingtonexaminer.com/politics/2011/05/pro-obama-media-always-shocked-bad-economic-news#ixzz1NlPykm7A

When Kennedy Blinked (WSJ)

Readers skeptical of the Camelot myth may experience twinges of schadenfreude while reading this meticulously researched, elegantly written account of John F. Kennedy's mortifying encounters with the Soviet Union's Nikita Khrushchev during the first year of his presidency. Others, on coming to the end of Frederick Kempe's molecule-by-molecule deconstruction of the Kennedy reputation for toughness, vigor, smarts and unshakable cool, are more likely to breathe a sigh of relief that civilization somehow survived the confrontation


-->Article in WSJ

Syria

Syrian government troops backed by tanks attacked two central towns Sunday in an attempt to stop round-the-clock protests there against President Bashar Assad’s regime, killing at least two people and wounding several others, activists and a rights group said.

Security forces in several other parts of the country fired on crowds holding overnight demonstrations, causing casualties, activists said.

The new attack using military forces pointed to Assad’s determination to crush the two-month-old revolt, despite US and European sanctions, including an EU assets freeze and a visa ban on Assad and nine members of his regime.

-->Article

Global Economic Rebound Weakens on Quake, Oil Price, European Debt Crisis

From Bloomberg:

The world economy is losing strength halfway through the year as high oil prices and fallout from Japan's natural disaster and Europe's debt woes take their toll.

Goldman Sachs Group Inc. now expects global economic growth of 4.3 percent in 2011, compared with its 4.8 percent estimate in mid-April, while UBS AG has cut its projection to 3.6 percent from 3.9 percent in January. Downside risks also include a shift to tighter monetary policy in emerging markets.

"The world economy has entered a softer patch with the incoming growth
data mostly disappointing," said Andrew Cates, an economist at UBS in Singapore. "We suspect this soft patch will endure for longer."

Article:

http://www.bloomberg.com/news/2011-05-27/global-economic-rebound-weakens-on-quake-oil-price-european-debt-crisis.html

Reid, Berkley part ways with president over Israel (Las Vegas Sun)

Rep. Shelley Berkley and Sen. Harry Reid are in lock step with President
Barack Obama when it comes to most of his domestic policies: They've been executors of his health care plan, defenders of the stimulus, and champions of his stances on energy, immigration and social spending.

But on foreign policy, Berkley and Reid appear to be parting ways with the president, and they're doing it over Israel.

Obama took the bold step last week by becoming the first U.S. president
to publicly endorse a two-state solution to end the protracted Israeli-Palestinian conflict based on pre-1967 lines, in a speech delivered on the eve of a diplomatic visit from Israeli Prime Minister Benjamin Netanyahu.

That didn't sit well with Nevada's Democratic delegation. Berkley was
the first to sound an alarm, saying she was "extremely troubled by President Obama's call for Israel to 'act boldly' for peace" and "also deeply concerned by any calls for Israel to return to the armistice line that existed before 1967 - that line left Israel far too vulnerable to
outside attack."

Reid followed suit a few days later, with a shout-out to Berkley and Nevada's "fastest-growing Jewish community in the country."

Article:

http://www.lasvegassun.com/news/2011/may/27/reid-berkley-part-ways-president-over-israel/

Mediscare: The Surprising Truth

The Obama administration has repeatedly claimed that the health-reform
bill it passed last year improved Medicare's finances. Although you'd
never know it from the current state of the Medicare debate-with the
Republicans being portrayed as the Medicare Grinches-the claim is true
only because ObamaCare explicitly commits to cutting health-care
spending for the elderly and the disabled in future years.

Yet almost no one familiar with the numbers thinks that the planned
brute-force cuts in Medicare spending are politically feasible. Last
August, the Office of the Medicare Actuary predicted that Medicare will
be paying doctors less than what Medicaid pays by the end of this decade
and, by then, one in seven hospitals will have to leave the Medicare
system.

Article:
http://online.wsj.com/article/SB1000142405270230406650457634573277599039
2.html?mod=googlenews_wsj
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The Dow...

...Has been down in June for the last 6 years

Apr US Personal Income...

... +0.4% vs. StreetAccount consensus +0.4%

Personal Consumption +0.4% vs. SA consensus +0.5%M

...

...took a swipe at Obama today with this
tweet: "@barackobama sorry to interrupt the European pub crawl, but
what was your Medicare plan?"

I hear Blago will testify...

... that he was a f'ing jerk.

Yale...

...to Restore Navy R.O.T.C. Program

Paul Ashworth...

...Of Capital Economics maintains that most all of the recent increases in consumer spending have been higher prices. Real spending has been about flat

Fitch Ratings...

...Lowered its outlook for Japan's debt to negative from stable

Conan:

Charlie Sheen selling his house. Sheen's realtor says the house is perfect for a young threesome just starting out.

POLL:

12% of Israeli Jews consider Obama to be pro-Israel

Rove:

Obama Will Let Medicare Go Bankrupt

http://www.newsmax.com/InsideCover/Rove-Obama-Medicare-campaign/2011/05/25/id/397627?s=al&promo_code=C57E-1

Congress...

...OKs extension of Patriot Act provisions, sends to Obama for signing

Under Bush, it was Fascism. Now, it is an essential element of our domestic security

Japan's April core consumer price index...

...up 0.6%, for first rise in over two years

Mitt Romney...

...will formally announce his campaign for president next Thursday, June 2, in New Hampshire, a Romney spokesperson told POLITICO.

GOP Senators Tell Reid:

No Budget, No Recess

EPA reveals new fuel Economy labels

Potential car buyers will see new designs for fuel economy labels, reflecting the increased use of alternatives to gasoline such as electric and diesel. The Department of Transportation and the Environmental Protection Agency unveiled the three types of new labels Wednesday.

One type is for cars that use gasoline or diesel, or hybrids that use only self-generated electricity. A second is for gas and electric hybrids that use some plug-in electricity, and the third is for vehicles running strictly on plug-in power.

Article: http://www.chicagotribune.com/classified/automotive/traffic/chibrkbus-epa-unveils-new-fuel-economy-labels-20110526,0,4753241.htmlstory

US Population is still growing...

....but not the way it once was. And it definitely isn't booming like populations in some other countries in the world.

Between 2000 and 2010, the country grew at a rate of 9.7%, which was
lower than any decade since the Great Depression, according to the U.S.
Census Bureau, which is releasing a steady stream of stats about the
nation.

During the 1930s, the country grew at a rate of about 7%. For comparison, the U.S. grew at a rate of about 19% in the 1950s, during the baby boom, and things generally have been slowing down since then.

The U.S. population in 2010 was 308.7 million.

The RCP poll average...

...Show President Obama's average approval at its highest since November 2009 (52.5%)

Intrade implies...

...Right now that the chances the the Democrats hold the White House is 62%

New Jersey Gov. Chris Christie has pulled out of a 10-state cap and trade scheme, known as the Regional Greenhouse Gas Initiative, the Record reports. Christie ultimately determined that the regulatory regime was burdensome to businesses and ineffective.

"It's a failure," Christie said, according to the Record. "RGGI has not changed behavior and it does not reduce emissions." The move is likely to further endear him to conservatives and bolster calls for him to enter the presidential race, an idea that he has repeatedly rejected

-Washington Examiner

Sen. Richard Durbin...

...second-highest ranking Democrat in the Senate, has sent out a fundraising appeal reminding party donors that Republicans need to gain just four seats in the 2012 election to take control of the Senate. "Four seats," Durbin says. "That's all it would take to lose our Senate majority. I know: I count the votes."

Durbin calls the possibility of Republican victory a "nightmare scenario." Imagine this, he tells donors: "Senators who want to end Medicare writing health policy. Lawmakers who think global warming is a hoax chairing the environment committee. President Obama's Supreme Court nominees wouldn't stand a chance."

Washington Examiner:

http://washingtonexaminer.com/blogs/beltway-confidential/2011/05/durbin-warns-nightmare-scenario-if-gop-wins-senate#ixzz1NTqjgzMo

Oh Come On!

By Jonah Goldberg

I've been wanting to write about the rhetorical overkill deployed by this administration when it comes to touting the President's decision to kill Bin Laden. I mean, is this really something only Barack Obama had the singular courage to do? Really? A Republican president wouldn't have killed Bin Laden under similar circumstances?

But I was also reluctant because, yes the president deserves praise for doing it and there are so few things I find praiseworthy in his agenda, better to focus on the things that revolve around fundamental disagreements. But this is just beyond the pale.

Joe Biden calls Obama's action against Bin Laden, "the boldest decision...any president has undertaken on a single event in modern history."

Seriously? Of course "modern history" is a relative term, so presumably
he excluding the Emancipation Proclamation or Truman's decision to bomb Hiroshima and Nagasaki. But how about Gerald Ford's pardon of Nixon? Or
Bush's surge?

And of course, boldness doesn't necessary depend on success. Carter's
botched mission to rescue the hostages was certainly bolder. So was Kennedy's Bay of Pigs. Indeed, given what a loose cannon Joe Biden is, Obama's decision to pick him as a running mate might even be bolder.

George Pataki...

...said he's thinking about running for president in 2012, but the former New York governor is tight-lipped about how likely it is that he will ultimately join the race. "We'll see as the campaign goes forward," Pataki, a Republican, said in an interview with The Daily Caller. Pataki, who runs an organization called No American Debt, said his "focus is simply on holding the political leadership starting with President Obama accountable for dealing with the deficit in a meaningful
way."

Daily Caller:

http://dailycaller.com/2011/05/26/george-pataki-says-he%e2%80%99s-open-to-2012-bid/

President Obama's approval rating...

...jumped seven points over the last month in the key swing state of Florida, a poll released Thursday showed. Fifty-one percent of registered voters in the Sunshine State approve of the way Obama is handling his job, while 43 percent disapprove.

That's a complete reversal from April, when his approval rating stood at 44-52 percent, according to a Quinnipiac University poll. Obama's position against a generic Republican also improved. He
leads a hypothetical GOP opponent 44-38 percent this month after trailing 38-41 percent in April.

RealtyTrac...

...the leading online marketplace for foreclosure properties, today released its Q1 2011 U.S. Foreclosure Sales Report(TM), which shows that sales of bank-owned homes and those in some stage of foreclosure accounted for 28 percent of all U.S. residential sales in the first quarter of 2011, up slightly from 27 percent of all sales in the fourth quarter of 2010 and the highest percentage of sales since the first quarter of 2010, when 29 percent of all sales were foreclosure sales

India's YoY Food inflation...

...Rose 8.55% for the week ended May 14

Washington D.C schools...

...rank 2nd highest in per-pupil spending yet rank worst in student performance

GDP ex inventory build...

...up sub 1%

Netflix video views...

...Drive 25% of peak internet traffic

GDP revision "miss"...

...Is being attributed to a smaller gain in consumer spending than expected reflecting a smaller rise in spending on autos and utilities

Initial Jobless claims...

...Climbed "unexpectedly" to 424K after printing 414K last week

It has now been over 400K for 7 consecutive weeks for the first time since Jan 28

A recovery that was expected to be gaining steam by now appears to be uneven and flattish

1Q GDP second revision

This had been forecast to be revised from 1.8% to 2.2%, but disappointed and stayed flat

The Economy remains by all evidence in a sluggish mode, and notable so compared to past recoveries

Senate moves Patriot Act...

...toward 4-year extension before Thursday midnight deadline

Remember the good old days when it the New Jack-booted Facism and then Senator Obama opposed it?

Ah, memories

Senate reject Obama Budget 97-0

Now that is bipartisanship

ABC News...

...shows Bill Clinton talking to Paul Ryan telling him not to back down on his plan

First revision...

...To 1Q GDP out tomorrow. Consensus forecast is and upward revision from 1.8% to 2.2%

For Mubarak loyalists...

...there's a sense of vindication as malaise spreads

If GOP abandons Ryan plan...

...the party will cease to have a reason to exist. -Philip Klein

Japan stocks...

...open sharply higher, with energy shares rallying; Nikkei Average up 0.9%

In the past year...

...American manufacturers have added almost 200,000 jobs to the payrolls

The New York Public Library...

...turned 100 years old this week. And so did anyone who still goes to the New York Public Library.

-Jimmy Fallon

Libya

President Barack Obama warned Libyan leader Muammar Gaddafi on Wednesday there would be 'no let up' in pressure on him to go, following a second successive night of heavy NATO bombing in Tripoli.

Six loud explosions rocked Tripoli late on Tuesday within 10 minutes, following powerful strikes 24 hours earlier, including one on Gaddafi's compound that Libyan officials said killed 19 people.

Obama told a London news conference with British Prime Minister David Cameron he could not predict when Gaddafi, who is fighting a three-month-old insurgency, might be forced to go. -Reuters

Are China's factories running out of power?

The provincial government in Zhejiang, a manufacturing hub close to Shanghai, has notified 44 major industries about limits on their power consumption.

Companies that exceed these limits face prohibitive power tariffs that would threaten much of the region's low margin manufacturing.

The story isn't any different in Guangdong, south China's manufacturing hub. Its industries must also cope with limits on power usage

President Barrack Obama...

...used his London press conference today to rewrite his politically damaging speeches on the Arab-Israeli stand-off
by raising his emphasis on the need for Arabs to recognize the legitimacy of Israel's existence.

"Hamas... has not renounced violence and has not recognized the state of
Israel," he told reporters this morning at a joint-press conference with the U.K. Prime Minister David Cameron. "Until they do, it is very difficult to expect the Israelis to have a serious conversation, because ultimately they have to have confidence that the Palestinian state is going to stick to whatever bargain is struck," he said.

GOP activists...

...are confident that they'll gain additional votes and donations from the Jewish community following President Barack Obama's call for Israel to retreat to territory along its pre-1967 border, with "mutually agreed swaps" in any final peace settlement with Palestinian
Arabs.

"Most Jews are Democrats because they vote on the basis of domestic policies," said Ari Fleischer, a former press secretary for George W. Bush. But, he added, "those who are more inclined to vote on international affairs are more likely to be independent and they tend to vote Republican,"

Controversial 'shock jock'...

...radio presenter Michael Savage, who was barred from entering the UK two years ago for his extreme views, has had the ban reaffirmed.,

The Conservative-led British government announced in July it would only lift the ban initiated by the previous Labor leadership if Savage took back statements he had made on his broadcasts that were deemed a 'threat to national security'.

And while the U.K has never specified which comments it found so dangerous, an attorney for the British government has stayed true to its threat, reaffirming the ban.

The Greek government...

...scrambled to resolve a standoff with its opposition over austerity on Wednesday, with one official warning the only alternative to more cuts was leaving the euro and bringing back the
drachma.

Sarah Palin...

has given few indications in recent weeks she is still actively considering a presidential run, but the former Alaska governor said Thursday she has the "fire in my belly" to mount a bid for the White House.

Appearing on Fox News, where she serves as a contributor,
Palin did not rule out the possibility that she could jump into the still-undefined Republican presidential field, though offered few specifics on where she is in her thought process.

"I think my problem is that I do have the fire in my belly," said Palin

Does anyone remember...

...when the President said that the Libya operation would be over in days not weeks?

Commodities Rise...

...Boosting Energy Shares; Treasuries, Dollar Erase Advance

The only person...

...better off today than he was four years ago is Mahmoud Abbas. --Are Fleischer
Sent from my Verizon Wireless BlackBerry

Today's MoM percentage drop...

...In durable goods at -3.6% is the second biggest drop since January 2009
Sent from my Verizon Wireless BlackBerry

Former Pres Clinton:

Brief US Default Might Not Be 'Calamitous'
Sent from my Verizon Wireless BlackBerry

Motorists in the US...

...pumped 2% less gasoline than a year ago in the survey week ended May 20. The YoY 4 wk average is down 1.6%. WoW also declined ~1.4%

President Obama says today...

...That Israel can't have a serious discussion with the Palestinians until Hamas renounces violence and recognizes Israeli right to exist

It looks like serious discussion won't begin soon

Libya

President Obama says objective in Libya is to end Qadaffi capacity to send in "bunch of thugs" to threaten Libyan people.

That pretty vague we'd say

Total U.S. durable-goods orders...

...drop 3.6% in April

Today's durables...

...ex transportation -1.5%; Consensus was +0.5%

UK PM Cameron...

...says it's impossible to see a future for Libya with Qadaffi still in power. "He must go," says Cameron.

Japan...

...swings to trade deficit as exports slump on quake, commodities rise
Sent from my Verizon Wireless BlackBerry

President Obama has ignored...

...His deficit commission, criticized the Ryan plan, and the Democratic Senate has not passed an actual budget in about 750 days

It is difficult to ascertain what the President and his Party are actually for

Tonight's election in NY26...

...is the most important election ever that we'll all have forgotten about in a month. -Mike Memoli

How did...

...one of our greatest Presidents sire a son as ignorant as Ron Reagan Jr? --Noel Sheppard

The Guarded Optimist attended a conversational meeting with Jeb Bush today who visited our firm. Very gracious and intelligent man. It is a pity that the time is not quite right for him to contend for the GOP Presidential nomination. He would bring much to the race and general discussion

China ...

...has been forced to ration electricity rather pass on the rising price of coal

House Republicans...

...to hold vote on debt limit increase

A little while ago...

...Bill Gross of PIMCO tweeted "End of QE2 may or may not lead to higher yields, but what is clear is that a 1.79% 5 yr offers a negative real
yield after inflation

The S&P 500...

...is no higher now than it was on February 7

35 Billion...

...In 2 year Treasuries auctioned today pricing at a yield of 0.56%, lowest (best) since December 2010

Best sector in the S&P 500 today...

...Is Oil&Gas with 84% of its names up on day

New Home Sales...

...At 323K annualized is the second highest monthly result since April 2010

President Obama's...

...Daily Rasmussen approval rating at 51% is the highest in 16 days

Egypt prosecutor general:

Hosni Mubarak and sons to be tried for deadly shooting of protesters

Greek private money...

...is being shifted to other countries as a consequence of the economic crisis, with about 280 billion euros ($394 billion) invested in Switzerland alone, Handelsblatt reported, citing Dimitris Kouselas, a state secretary at Greece's finance ministry

The amount deposited in Switzerland is equal to 120 percent of Greece's gross domestic product, the newspaper said. The two biggest Swiss banks manage 20 billion euros in funds owned by Greek private customers, Handelsblatt said, citing people in the Swiss finance
industry.

The President said...

...That he was going to tell Israel "the truth". While he is at it, he should make sure he tells the Palestinians there simply is no "Right of Return" the way they envision it in any "Peace" settlement.

Greek public sector union...

...plans 24-hour general strike in June to protest new austerity measures

Rep. Peter King...

...Claims tonight that Rudy Guiliani is "very close" to jumping in the Presidential Race

Chris Matthews...

...says the Ryan's Medicare plan is a "Death Certificate" for Republicans

It may hurt them. But to me, it is a certainty that one way or the other, Medicare will be cut in the next decade, by means testing or otherwise

I am getting increasingly concerned...

...About the weak Democratic field for the 2012 Presidential nomination

People's favorite...

...candidate for President is all too often someone who is not running

No one is talking about ObamaCare anymore...

...the conversation has switched to RyanCare and the safety of Grandma by cliffs

ZeroHedge feels strongly about Greece

What a difference a year makes. It was just over a year ago that Greece
received its first (and certainly not last) $1 trillion + bailout package from the EU, the ECB and the IMF. Just over 12 months later, all those who peddled Greek bonds to the rest of the world (ahem Germany) are now furiously backtracking, having finally realized what we, and everyone else with half a brain realized from the beginning: it's over for the euro.

But fine, let's kick the can down the road for a few more months, which
will allow banks, with access to interest-free central bank capital, to literally steal Greece's soon to be privatized assets for pennies on the dollar, and then send the carcass, now picked dry, to the international bankruptcy court.

In the meantime, we would like expose all the idiots who like various anchors on Comcast's bubblevision channel, pitched Greek paper to hapless investors, only to see losses (this is not some speculative asset - this is fixed income) of over 40% in one year, and for some reason continue to have a podium from which to spread their lunacy, greed and outright stupidity.

Greek Cabinet...

...Backs further State asset sales after bond market sell off

New Home Sales...

...Come out tomorrow. They are forecast to be the same as last month, 300K (annual rate)

The dollar...

...hit a 2-month high against the euro today

Oil futures...

...dropped more than 2% today as worries about Europe's sovereign-debt problems resurface

Senior Hamas leader Mahmoud Zahar...

...said Monday that it was clear that US President Barack Obama's platform was not so different from the one adopted by former US president George W. Bush. According to Zahar, the 1967 borders, while "sacred," were not the final borders on which the Palestinians should settle

Speaking to Al-Emirate Al-Youm, Zahar asked "Why won't we talk about the
1948 borders? Why won't we discuss the partition plan which was
internationally recognized?"

AIPAC Director

"In a world which is demonstrably on the side of the Palestinians and Arabs - where Israel stands virtually alone - the United States has a special role to play," said the AIPAC director. "When the United States is even-handed, Israel is automatically at a disadvantage, tilting the diplomatic playing field overwhelmingly toward the Palestinians and Arabs."

France, allies...

...to begin deploying attack helicopters in Libya against Gadhafi's forces - Reuters

I am not looking...

...For a US President to be absolutely even handed regarding the Israeli Palestinian dispute.

Many Americans admire Israel for creating value in the world in unique ways, and because it has constructed a society that functions in a fashion we would prefer others in the region emulate more.

Those Americans also look for Peace, but not at any cost

Gasoline Future...

...Lowest since March 16

Bill

Greece Ten year bond yield...

...Continues to soar, now at 16.625%

GOP nomination contracts

Leaders on the Intrade board

Romney. 27%
Pwlenty. 24%
Huntsman. 15%
Cain. 6%
Palin. 6%
Bachmann. 5%
Gingrich. 3%
Christie. 3%
Perry. 3%

Scott Brown

"I'm voting no on Paul Ryan's budget"

The bonds of European sovereigns

...in the cross hairs of this morning's market anxiety are all sharply lower, pushing their yields higher against relatively safe German bunds.

Italian 2-year debt is about 15 basis points wider against bunds, yielding 3.07% — not much less than what the U.S. government pays to borrow for 10 years.

-WSJ

Intrade implies...

...That the Democrats have about a 60% chance of holding the White House in 2012

It is not really so important...

...Exactly how the President evolves and nuances his Israel positions. He is in the eyes of many a creature of the faculty lounge left. He has never run a business or served in a military defending a nation form an existential threat (like Netanyahu). He is an abstract academic thinker who has always had the luxury of being so

Many of people he has associated with his entire life have broadly been unsympathetic to the notion of an Israel State and what it has had to do to defend itself.

For that reason, he will never have the full trust of those that love or admire Israel and what it has created

Chicago Fed National Activity Index...

...Drops To -0.45, Lowest Since August 2010, Economy Enters "Below-Average" Growth

Spain's Socialists Trounced Amid Economic Turmoil

CNBC-->article

Spain's ruling Socialists suffered a crushing defeat to conservatives in local and regional elections Sunday, yielding power even in traditional strongholds against a backdrop of staggering unemployment and unprecedented sit-ins by Spaniards furious with what they see as politicians who don't care about their plight.

Prime Minister Jose Luis Rodriguez Zapatero said the result was due punishment of his government for the state of the economy — the jobless rate is a eurozone high of 21.3 percent. But he said he had no plans to move up general elections, which must be held by March of next year, and pledged to press on with job-creating reforms despite the loud outcry of opposition to his party. 

Euro...

...Weakens to 1.4085

Hang Seng...

...Opens week down about 1.5% so far
Sent from my Verizon Wireless BlackBerry

US Stock futures...

...Weak in Sunday evening trading

Sent from my Verizon Wireless BlackBerry

President Barack Obama said Sunday...

.... that any controversy over his remarks last week that Israel-Palestinian negotiations should start from pre-1967 borders and include land swaps was "not based in substance."


In his first speech as president to the main American-Israeli lobby group, the American Israel Public Affairs Committee (AIPAC), Obama said his reference to the border issue in a major policy speech on the Middle East "means that the parties themselves - Israelis and Palestinians - will negotiate a border that is different than the one that existed on June 4, 1967," the eve of the six-day war in which Israel seized the West Bank, Gaza Strip and other territory ---CNN

Would the President...

...Rather play Golf or address AIPAC today?

Pakistan...

...wants China to build it a naval base, in the latest sign of moves to strengthen ties with Beijing as relations with Washington falter.
The announcement from Pakistan's defense minister came a day after Pakistan's Prime Minister Yusuf Raza Gilani returned from a four-day visit to China, Islamabad's biggest arms supplier.
"We would be ... grateful to the Chinese government if a naval base is ... constructed at the site of Gwadar for Pakistan," Defence Minister Ahmad Mukhtar said is a statement, referring to a deepwater port in Pakistan's southwest

Here Is What Happens After Greece Defaults

From ZeroHedge-->article

When it comes to the topic of Greece, by now everyone is sick of prevaricating European politicians who even they admit are lying openly to the media, and tired of conflicted investment banks trying to make the situation appear more palatable if only they dress it in some verbally appropriate if totally ridiculous phrase (which just so happens contracts to SLiME). The truth is Greece will fold like a lawn chair: whether it's tomorrow (which would be smartest for everyone involved) or in 1 years, when the bailout money runs out, is irrelevant. The question then is what will happen after the threshold of nevernever land is finally breached, and Kickthecandowntheroad world once again reverts to the ugly confines of reality. Luckily, the Telegraph's Andrew Lilico presents what is arguably the most realistic list of the consequences of crossing the senior bondholder Styx compiled to date.
What happens when Greece defaults. Here are a few things:

• Every bank in Greece will instantly go insolvent.
• The Greek government will nationalise every bank in Greece.
• The Greek government will forbid withdrawals from Greek banks.
• To prevent Greek depositors from rioting on the streets, Argentina-2002-style (when the Argentinian president had to flee by helicopter from the roof of the presidential palace to evade a mob of such depositors), the Greek government will declare a curfew, perhaps even general martial law.
• Greece will redenominate all its debts into “New Drachmas” or whatever it calls the new currency (this is a classic ploy of countries defaulting)
• The New Drachma will devalue by some 30-70 per cent (probably around 50 per cent, though perhaps more), effectively defaulting 0n 50 per cent or more of all Greek euro-denominated debts.
• The Irish will, within a few days, walk away from the debts of its banking system.
• The Portuguese government will wait to see whether there is chaos in Greece before deciding whether to default in turn.
• A number of French and German banks will make sufficient losses that they no longer meet regulatory capital adequacy requirements.
• The European Central Bank will become insolvent, given its very high exposure to Greek government debt, and to Greek banking sector and Irish banking sector debt.
• The French and German governments will meet to decide whether (a) to recapitalise the ECB, or (b) to allow the ECB to print money to restore its solvency. (Because the ECB has relatively little foreign currency-denominated exposure, it could in principle print its way out, but this is forbidden by its founding charter.  On the other hand, the EU Treaty explicitly, and in terms, forbids the form of bailouts used for Greece, Portugal and Ireland, but a little thing like their being blatantly illegal hasn’t prevented that from happening, so it’s not intrinsically obvious that its being illegal for the ECB to print its way out will prove much of a hurdle.)
• They will recapitalise, and recapitalise their own banks, but declare an end to all bailouts.
• There will be carnage in the market for Spanish banking sector bonds, as bondholders anticipate imposed debt-equity swaps.
• This assumption will prove justified, as the Spaniards choose to over-ride the structure of current bond contracts in the Spanish banking sector, recapitalising a number of banks via debt-equity swaps.
• Bondholders will take the Spanish Banking Sector to the European Court of Human Rights (and probably other courts, also), claiming violations of property rights. These cases won’t be heard for years. By the time they are finally heard, no-one will care.
• Attention will turn to the British banks. Then we shall see…

Look Ahead: Currencies Could Sway Stocks in the Coming Week

From CNBC

U.S. markets in the coming week may be slower heading into the first official long weekend of summer, but fidgety currency markets could keep the focus on Europe and geopolitical concerns

Nobody expects a repeat performance of the high-flying but there are a few initial offerings in the week ahead, including Russian internet company Yandex, already drawing good demand. 

"I think the markets will continue to be focusing on what is or isn't happening in Greece. We don't think anything will materialize though," said Robert Sinche, head of global currency strategy at RBS.

Every Cloud Has a Silver Lining, Installed by the European Union

By Mark Steyn at The Corner

Andrew, speaking of the drain from Spain, you don’t know the half of it. Leading climatologist Mahmoud Ahmadinejad brings us up to speed on the latest settled science:

Mahmoud Ahmadinejad has accused Western countries of plotting to “cause drought” in Iran by using high tech equipment to drain the clouds of raindrops… 

“Western countries have designed plans to cause drought in certain areas of the world, including Iran,” Mr Ahmadinejad said in the city of Arak in Markazi province.

“According to reports on climate, whose accuracy has been verified, European countries are using special equipment to force clouds to dump” their water on their continent, he said.

By doing so, “they prevent rain clouds from reaching regional countries, including Iran,” Mr Ahmadinejad charged.

Iran has experienced several droughts in recent years.

But don’t tell me the sinister Eurocrat in charge of cloud draining, monitoring the speech back in his office in Brussels, doesn’t have a sense of humor:

Moments after the Iranian president made the startling claim at the inauguration of a dam in a central province, it started to rain.

Much as I’d like to believe him, I think these “raindrop exchanges” are far more likely to be a low-key pilot scheme for the next level of “offset trading”. I’d bet Al Gore’s already on his way to his second billion from it. 

The New Precedent on War Powers

From No Left Turns--->article  [Robinson O'Brien-Bours]

"No more ignoring the law when it's convenient. That is not who we are...We will again set an example for the world that the law is not

subject to the whims of stubborn rulers." ~Senator Barack Obama, August, 2007.

"The President does not have power under the Constitution to unilaterally authorize a military attack in a situation that does not involve stopping an actual or imminent threat to the nation." ~Senator Barack Obama, December, 2007.

From now on, citing President Obama's entrance into the Libyan Civil War as precedence, American presidents will now be able to unilaterally wage war or target bombing against any nation or any individual at any time. Since the end of the Second World War, the necessity of of a congressional declaration of war has been removed as a needless technicality. The War Powers Resolution, keeping a slight congressional check on the martial power of the Executive Branch since Vietnam, was successfully used by the likes of Bill Clinton and George Bush in their campaigns abroad, both gaining congressional authorization within the 60 day limit. Now, like the formal declaration of war, the War Powers Resolution is but a needless technicality. Without congressional oversight, most of the "goals" that President Obama gave us in his after-the-fact justification of the humanitarian action war have changed-- we are now actively seeking regime change, we are doing far more than enforcing a no-fly zone, and there is no time limit or endgame in sight.

Congress, for its part, is and will remain subservient to this due to the politics involved (certainly good use of the Obama White House's mantra of never letting a good crisis go to waste); the sole power they have left is the power of the purse, which they will never invoke due to not wanting to pull the rug out beneath the military's feet. What strikes me as odd is that Congress would have certainly approved the military intervention had they been asked to formally do so as they did for Iraq, so there is really no pressing reason why their role in war-making should have been so carelessly cast aside. No matter, now-- precedence is precedence when it comes to the powers of the Executive Branch in our nation, and we shall now have to deal with the results until future members of Congress rediscover the ambition and manliness that is supposed to make checks and balances work. I'm not holding my breath.

Green Jobless

from The Corner by Andrew Stuttaford

Via the Guardian (emphasis added):

Government talk of economic recovery was undermined on Friday when the country’s largest steel maker announced plans to cut 1,500 jobs in Lincolnshire and Teesside.

Tata Steel, which bought the Corus business in 2007, blamed a continued slump in demand from the construction sector but also new climate change legislation for its decision.

“We are aware that our employees and their families will experience a very unsettling few months as a result of this announcement. We will do everything we can to provide them with support and assistance,” said Karl-Ulrich Köhler, chief executive of Tata Steel’s European operations.

“The continuing weakness in market conditions is one of the main reasons why we are setting out on this difficult course of action. Another is the regulatory outlook. EU carbon legislation threatens to impose huge additional costs on the steel industry. Besides, there remains a great deal of uncertainty about the level of further unilateral carbon cost rises that the UK government is planning,” he added.

The Euro Doom Scenario Starts With What's Happening In Spain Right Now

Business Insider artticle--> here

Barack Obama's state visit to Britain hit by splits over Libya

Tensions over the military campaign against Libya have cast a cloud over President Barack Obama’s state visit to Britain this week, The Sunday Telegraph has learned. 

 Article in "The Telegraph"---> here

Military and diplomatic sources in both Britain and the US are privately critical over the other side’s role in the action which has hit a damaging “stalemate” and left Colonel Muammar Gadaffi clinging to power.

Britain wants the US to take more of a defined role in the campaign, with UK military chiefs protesting that the effectiveness of bombing raids is being lessened by the absence of American leadership.

US diplomatic sources, meanwhile, have criticised Britain as a “skittish” and unpredictable ally which frequently issues a “red card” -- effectively vetoing a target, causing confusion and greatly hampering proper planning

Senior Palestinian officials...

 ...say that negotiations with Israel have become pointless after Israel's prime minister rejected President Barack Obama's call to base Mideast border talks on the pre-1967 war lines.

Israeli Prime Minister Benjamin Netanyahu's stance only strengthened the Palestinian resolve to bypass such talks, largely deadlocked since 2008, and seek recognition of a state at the UN instead, said Nabil Shaath, an aide to Palestinian President Mahmoud Abbas  --AP

Apple...

makes huge inroads in enterprise as corporate Mac sales surge 66%

At MIT...

...eccentricity pays. Alumni have founded 25,800 companies, which generate revenues of about $1.9 trillion

Tuition Skyrockets....

...while learning plummets

 Article--->here

Student debt just surpassed the country's credit-card debt for the first time. It is projected to top $1 trillion this year, according to the New York Times, when it was less than $200 billion in 2000. For the class of 2011, the mean student-debt burden is nearly $23,000, up 8 percent from a year ago.

A sign...

...that Cain may be a more serious candidate than many people think is the fact that he is pretty much ignored in the mainstream media. I mean, he doesn't have the brilliance and talent of Palin or Trump, but he must have some good qualities

Canada refuses to join Obama's call for Israel to return to 1967 borders

Article-->here

“What the government of Canada supports is basically a two-state solution that is negotiated,” a senior federal official said. “If it’s border, if it’s others issues, it has to be negotiated, it cannot be unilateral action.”

Netanyahu to Obama:

'Peace based on illusions will crash eventually on the rocks of Middle Eastern reality.’

Krauthammer to PBS's Shields

 'You Want GOP Nominee Who's a Squish and Then You’ll Vote Against Him Anyway'

Italy Outlook...

...Revised to Negative by S&P, Prompting Vow of Faster Reforms

Larry Summers...

...is one of the great contrarian indicators of our times. He is brilliant, but still manages to get most things completely wrong. --Joshua M. Brown

Iran...

...Arrests 30 People In An Alleged U.S. Spy Network

Presidential approval...

...In Rasmussen's daily poll is 48% the lowest in 6 days

The highest post Bin Laden's liquidation was 51%

PA Statehood

It seems dangerous at this point to give Abbas the impression that unreformed Hamas inside PA will lead to statehood. -- Eli Lake

If Sarah Palin....

...feels any "Fire in the Belly" about 2012,   I suggest she stop, and wait for that feeling to pass before proceeding

Borders

Is the President more worried about Arizona's border or Palestine's?

The blow up with Israel

The Washington Post editorial --->May 20

Lead paragraph:

PRESIDENT OBAMA and Israeli Prime Minister Binyamin Netanyahu have a powerful and urgent common interest. Palestinian President Mahmoud Abbas has turned his back on both Israel and the United States; he is seeking accommodation with the extremist Hamas movement and has announced that he will seek a declaration of Palestinian statehood from the U.N. General Assembly in September. The result could be what Mr. Netanyahu’s defense minister calls “a diplomatic tsunami” against Israel and possibly the eruption of another Israeli-Palestinian war. As for the United States, the U.N. vote could isolate it in support of Israel, undermine the ambitious strategy that Mr. Obama has just announced to promote democracy in the Arab world — and maybe derail the Arab Spring itself.

Mahmoud Ahmadinejad....

....has accused Western countries of plotting to "cause drought" in Iran by using high tech equipment to drain the clouds of raindrops. Moments after the Iranian president made the startling claim at the inauguration of a dam in a central province, it started to rain. "Western countries have designed plans to cause drought in certain areas of the world, including Iran," Mr Ahmadinejad said in the city of Arak in Markazi province

White House on War Powers Deadline...

..."Limited" US Role in Libya Means No Need to Get Congressional Authorization. -- Jake Tapper

The International Monetary Fund ...

...approved a loan of 26 billion euros, or $36.81 billion, to Portugal, according to media reports Friday. Under the agreement, Portugal will get 6.1 billion euros immediately, according to reports.

The US taxpayer foots about 18% of this loan to poorly run Portugal

Student debt

...just surpassed the country's credit-card debt for the first time.

It is projected to top $1 trillion this year, according to the New York Times, when it was less than $200 billion in 2000. For the class of 2011, the mean student-debt burden is nearly $23,000, up 8 percent from a year ago

Payrolls...

...Grew in 42 US states in April, while the unemployment rate fell in 39, indicating broad based strengthening in the labor market

Oil...

...Rose for the second time this week, following heating oil, after the American Petroleum Institute reported that fuel consumption increased in April as economic growth bolstered demand for diesel by truckers

Greece's credit rating...

...Was cut 3 levels by Fitch, which said that even a voluntary extension of its bond maturities being studied by EU policy makers would be considered a default

Amazon sales of digital books for Kindle...

...overtake print titles for first
time

From "The Telegraph"

"Customers are now choosing Kindle books more often than print books,"
Amazon founder and chief executive Jeff Bezos said in a statement.

"We had high hopes that this would happen eventually, but we never
imagined it would happen this quickly," Mr. Bezos added. "We've been selling print books for 15 years and Kindle books for less than four years."

The Seattle, Washington-based Amazon said that since April 1, it was selling 105 Kindle e-books for every 100 print books, hardcover and paperback combined.

The figures referred to the company's US website, not Amazon.co.uk.

The company said it had sold more than three times as many Kindle books so far in 2011 as it did during the same period last year

The International Monetary Fund...

...said Ireland's ability to sell sovereign bonds remains "elusive"and its situation may worsen unless the European Union develops a more comprehensive plan to deal with the region's debt crisis

Flows

Commodities funds saw their largest outflow on record by dollar amount,
$1.6 billion, which marks the third consecutive weekly outflow totaling 3% of assets. Gold and silver focused mutual funds accounted for more than 50% of outflows this week.

In other asset classes, equity funds saw a sizable outflow, $7.3 billion, the largest in 45 weeks, while municipal bonds continued to see outflows, $215 million, which is the 27th consecutive negative weekly net flow. [Merrill Lynch]

2.5 years after...

...Goldman became FDIC insured it is still tricky to find a Goldman ATM machine. [Zerohedge]

Nato strikes...

...hit Gaddafi warships: Nato warplanes bomb Libyan warships in co-ordinated attacks on three ports

Spanish 2-Year Yields...

...On A Tear, And Officially Hit Their Worst Level Of The Year [graystonestrader]

NYT: Obama speech intentional move to pre-empt Netanyahu.

From the NYT

As Prime Minister Benjamin Netanyahu of Israel heads to the White House on Friday for the seventh meeting since President Obama took office, the two men are facing a turning point in a relationship that has never been warm.

By all accounts, they do not trust each other. President Obama has told aides and allies that he does not believe that Mr. Netanyahu will ever be willing to make the kind of big concessions that will lead to a peace deal.

For his part, Mr. Netanyahu has complained that Mr. Obama has pushed Israel too far - a point driven home during a furious phone call with Secretary of State Hillary Rodham Clinton on Thursday morning, just hours before Mr. Obama's speech, during which the prime minister reacted angrily to the president's plan to endorse Israel's pre-1967 borders for a future Palestinian state.

Freddie Mac...

...Today released its Primary Mortgage Market Survey which shows fixed rate mortgages declining for the fifth consecutive week amid mixed economic and housing data. The 30 year fixed averaged 4.61% and the 15 year 3.80%. --Reality Times

Asian Stocks...

...Drop for Third Week as Commodities, Japan Utilities Decline

Greek Debt today

The yield on Greece's 10-year government bond rose to record levels as speculation rose that the euro zone nation would default on its debt repayments.

As the 10-year bonds were sold off, the yield climbed 61.5 basis points to 16.75 per cent, a new record, on Friday. The yield on the equivalent German note, meanwhile, eased to 3.12 per cent as Bunds were sought out as havens.

German Chancellor Angela Merkel...

...backs Obama's speech on Mideast and describes 1967 borders proposal as 'good' path - Reuters

In his interview with BBC...

...POTUS suggests he was not referring to Jerusalem when discussing 1967 lines

-Jake Tapper. ABC

File under self serving conclusions

From Dayton Daily News;

A long-awaited study on the "causes and context" of the priest child sexual abuse scandal, commissioned by U.S. bishops in 2006 and released Wednesday, blames the sexual revolution of the 1960s and 1970s, not celibacy or homosexuality, for the crisis that has rocked the Roman Catholic church. While the report largely paints the crisis as a historical blip in the history of the church

Patriot Act

From 2Chambers (Twitter)

A senior Dem aide confirms Reid, Boehner & McConnell agreed on a clean, 4-year extension of Patriot Act provisions. No word yet on Pelosi.

(GO: Of course Pelosi does not matter as the leader of a small minority in the House has approximately zero power)

Abbas calls emergency meeting over Obama address

Somehow the President's speech seems to make no on happy

From the Jerusalem Post:

PA president seeks urgent consultations with Arab leaders over address; Hamas spokesmen accuses Obama of "deception," favoritism to Israel. Palestinian Authority President Mahmoud Abbas on Thursday called an emergency meeting of the PA leadership to discuss US President Barack Obama's speech on peace in the Middle East, a PA official in Ramallah said.

Abbas has also decided to hold urgent consultations with a number of Arab leaders on the speech, the official said. PLO Executive Committee member Saeb Erekat said that Abbas remained committed to fulfilling all Palestinian obligations in accordance with international agreements

Netanyahu's tweets

From Jake Tapper at ABC

Israeli Prime Minister Netanyahu's Office twitter account -- run by Dr. Eitan Eliram, new media director of the prime minister's office –- sent out a rapid succession of tweets stating clear disapproval with the president's reference to the 1967 borders:

"Israel appreciates President Obama's commitment to peace. Israel believes that for peace to endure between Israelis and Palestinians, the viability of a Palestinian state... cannot come at the expense of the viability of the one and only Jewish state,"

I was interested...

...In the Strauss-Kahn arrest. I was interested in the resignation and indictment

Now I don't want to hear about it again till there is a plea or a verdict

The Guarded Optimist of course remains interested in any and all French angst or nashing of teeth over the matter

President Obama will not sit down with Voice America (VOA)...

...but the BBC sure got his attention. -Heritage Foundation

After shaking Israel back to its 1967 borders...

...Obama reiterates his "unshakable" commitment to Israel. -David Limbaugh

New documents suggest Supreme Court Justice Elena Kagan involved withcrafting legal defense of ObamaCare

New documents suggest Supreme Court Justice Elena Kagan involved with
crafting legal defense of ObamaCare

From the Daily Caller


Emails between Supreme Court Justice Elena Kagan and members of the
Obama Administration reveal she was more involved with President Obama's
health-care law than was disclosed previously. The documents likely will
lead to a revival of questions about whether the Kagan should recuse
herself from future cases.

Specifically, the documents show that Kagan was involved with crafting the legal defense of the Affordable Care Act in her role as solicitor general, before her appointment to the bench. The Media Research Center and Judicial Watch obtained the documents through a Freedom of Information Act (FOIA) lawsuit that was filed in February 2011.

In an email dated Jan. 8, 2010, then-Deputy Solicitor General Neal Katyal sent an email to Senior Counsel Brian Hauck and Deputy Attorney General Thomas Perrelli that indicates Kagan played a key role in coming up with a legal defense.

"Brian, Elena would definitely like OSG [Office of Solicitor General] to be involved in this set of issues ... we will bring Elena as needed."


Read more:
http://dailycaller.com/2011/05/18/new-documents-suggest-supreme-court-ju
stice-elena-kagan-involved-with-crafting-legal-defense-of-obamacare/
Sent from my Verizon Wireless BlackBerry

Breaking News: Peter Fonda somehow still matters

From Yahoo! News:

Peter Fonda calls Obama 'traitor' at Cannes

CANNES, France (AFP) - Peter Fonda launched a four-letter attack on US
President Barack Obama at the Cannes film festival on Wednesday, calling
him a traitor over the handling of the aftermath of the Gulf oil spill.

The star of the 1969 road movie "Easy Rider" was in Cannes for the
premiere of "The Big Fix" by Rebecca and Josh Tickell, the only feature
documentary in the official selection at the Cannes film festival this
year.

Fonda -- a keen environmentalist and co-producer of the film which
centers on the explosion of the BP oil rig Deepwater Horizon, the
ensuing spill and its consequences -- accused Washington of trying to
gag reporting on the issue.

"I sent an email to President Obama saying, 'You are a f(expletive)
traitor,' using those words... 'You're a traitor, you allowed foreign
boots on our soil telling our military -- in this case the coastguard --
what they can and could not do, and telling us, the citizens of the
United States, what we could or could not do'."

Fonda, who said he sent the email last week, appears in "The Big Fix"
trying to get on to Louisiana beaches to assess the impact of the
biggest oil spill in US history, only to be turned away by BP clean-up
personnel.

Speaking at a press event at the American Pavilion to promote the film,
Fonda denounced BP as "a bunch of Brits -- I thought we kicked them out
a long time ago. They tried to get back in in 1812, but they didn't make
it."

Sent from my Verizon Wireless BlackBerry

Data Signal Global Industrial Slowdown

From Investors Business Daily:

A global summer slowdown looms as a leading indicator of factory activity has turned down, according to a well respected independent research firm.

The Economic Cycle Research Institute's long leading indicator of global industrial growth peaked at 0.7 in August 2010, predicting a cyclical peak for industrial activity this summer.

The index stood at 0.1 in March, near the lowest level since January 1980.
"There's a downturn in global industrial growth in clear sight," said ECRI managing director Lakshman Achuthan

Leading indicators...

...At -0.3% come in the lowest since February 2009 and the first negative print since June of 2010

Boston Herald caption

...under Obama photo: YES WE BAN!

Middle East Demographics

An interesting statistic is that 33% of Egypt's population is less than 14 years of age

China Central Bank says:

..."New IMF Leadership Should Reflect New World Order"

Initial Jobless claims...

...Come in at over 400K for the sixth week in a row. That is the first time that has happened since Jan 8

Dominique Strauss-Kahn was warned

From the New York Post;

Before he left to run the International Monetary Fund, French President Nicolas Sarkozy told him to control himself in the United States when it came to women.

"Over there they don't joke about this sort of thing," The Times of London quoted Sarkozy as telling Strauss-Kahn. "Your life will be passed under a magnifying glass. Avoid taking the lift alone with interns. France cannot permit a scandal."
Sent from my Verizon Wireless BlackBerry

Tennessee...

...to vote tomorrow on Wisconsin-like labor legislation

Japan's economy...

...contracted at a much-worse-than-expected 3.7% last quarter

Obama to Offer...

...$1 Billion to Egypt ... As part of new Mideast outreach

Toomey: Default Not Necessary

Andrew Stiles from "The Corner" [National Review Online] summarizes Toomey here on the matter of the debt ceiling and the hysteria and fear mongering around it:


As part of his continued effort to dispel the conventional wisdom regarding the debt limit (i.e., hysteria over imminent default), freshman Sen. Pat Toomey (R., Pa.) stopped by the American Enterprise Institute on Wednesday to set the record straight.

It’s not that Toomey opposes any increase to the debt ceiling — he’d support one if meaningful spending cuts and reforms are attached — but he insists that it is “absolutely false” for the Obama administration to “rhetorically equate” failure to raise the debt limit with a national default. Indeed, Democrats have repeatedly accused Republicans “playing chicken” with the full faith and credit of the United States.

Toomey argues this is bunk for two simple reasons: 1) next year’s projected tax revenue (approx. $2.2 trillion) is more than enough to service the roughly $200 billion in interest payment the U.S. owes on its debt, and good for about 75 percent of all government expenditures like Medicare, Social Security, defense, etc.  – “There is no danger of a shortage of cash to pay the debt,” Toomey said. And 2) Treasury has the authority to prioritize payments to ensure the country doesn’t default.

In other words, a default is certainly a possibility, but it wouldn’t be the result of Congress’s failure to raise the debt ceiling, but rather a failure of the White House to take measures necessary to prevent it. For this reason, Toomey introduced legislation earlier this year that would instruct Treasury to take these measures and prioritize payment on the debt in order to “take the specter of default off the table.” His goal being to simply put an end to concerns that are being fueled by dishonest and inflammatory rhetoric in order to have a sober conversation about the (spending) problems that we face. Democrats, however, seem to prefer to keep the American public good and scared. Toomey’s bill – the Full Faith and Credit Act – failed on a party line vote in the Senate.

Not raising the limit would be “disruptive,” Toomey acknowledged, but far from the “catastrophic default” the White House has been warning of.

He cited a recent interview in the Wall Street Journal with Stanley Druckenmiller in which the legendary investor (who owns a substantial amount of U.S. Treasury bills) suggested that doing nothing to address country’s unsustainable debt problem would do far greater damage to the U.S. economy than a technical or temporary default, saying: “People aren’t going to wonder whether 20 years ago we delayed an interest payment for six days. They’re going to wonder whether we got our house in order.” Toomey, a former bond trader himself, said he had been hearing these concerns from many in the financial community.

That is why it is vital that Congress work together on a deal to significantly cut spending and reform the spending process to ensure history doesn’t repeat itself. “The most irresponsible thing Congress could do is not insist on a change of course,” Toomey said. “I’m confident that it’s not too late, but my intuition is that the window of opportunity is closing. We need to move now.”

Otherwise, the U.S. risks suffering the same fate as Greece, a country whose economic collapse came on swiftly and unexpectedly. As it stands, Treasury bill rates remain low, an indication that markets believe the U.S. government will resolve the issue, but that could easily change, and rapidly, especially in the event of some unforeseen event like a terrorist attack or natural disaster.

In exchange for an increase in debt, Toomey would like Congress to approve a Balanced Budget Amendment, strict spending caps and significant cuts in next year’s budget. When a family spends too much and maxes out their credit cards, he said, the answer in not to simply “throw them another credit card.” As for any increase he taxes, he is firmly opposed – higher revenue must come through economic growth. “And it’s going to be hard to see how [a deal] will pass the House if they raise taxes,” he added. But the two parties may be able to find common ground on tax reform that lowers rates by closing loopholes.

Toomey said he was hopeful that Democrats would “come around” because the American people are demanding that their government get serious about addressing the problem. Freshman Senators like himself, not to mention the new class in the House, Toomey argued, ought to have the keenest sense of where the public stands. The stakes are certainly high, but so are his hopes for the country. “If we make the right decisions now, the 21st century can be another great America century,” he said.

The Boston Herald responds to White House retribution...

...Here: Obama off the deep end

"We all know Obama has an aversion to tough questions. During the campaign, he would refuse to engage with most local media, and reporters who camped out at the rope line got a stern talking-to from a campaign staffer.But using the White House press pool to possibly punish or reward media based on what the White House considers “fair” coverage? This is taking the control freak thing to new levels"

Tomorrow...

....The 60 day clock runs out on the Libya operation, under the War Powers Resolution
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Romney calls it...

... "embarrassing" that the WH took "a retribution type of act against a leading journal such as the Boston Herald"
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Economic releases tomorrow

Mortgage Delinquencies, Existing Home Sales, Unemployment Claims
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IPad and Tablets

From Bloomberg:

The iPad is wreaking havoc on the personal computer market. HP's consumer PC sales plunged 23% last quarter and the company lopped one billion off its annual sales forecast. Sales at Dell slumped 7.5%

More than 70 million tablet like the iPad will be sold in 2011, a total that will grow to 246 million in 3 years according the Jeffries & Co
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Bribery in Reverse

From WSJ Online [Taranto]

"Illinois in 2011 is on pace to provide much more money in financial
incentive programs to businesses to retain and add jobs, with the total
through early May exceeding $230 million pledged to 27 companies," the
Chicago Tribune reports:

Gov. Pat Quinn is turning to the incentives, which include tax credits,
training funds and grants, as Illinois copes with a moribund economy and
battles other states to woo companies that have shown a willingness to move--or stay put, if the price is right.

No wonder: Whereas other states have been reducing spending, Quinn and
his fellow Democrats in the Legislature have dealt with their state's pending insolvency by raising taxes through the roof. But here's the part of the Trib report that raised our eyebrows:

The identities of 21 of the 27 companies receiving a total $53.1 million were not disclosed in a list provided to the Tribune on Tuesday by the state's Department of Commerce and Economic Opportunity.

The company names weren't released because of nondisclosure agreements
with the companies, because contracts have not been finalized or because
employees had not been told of plans at the companies in question,
department spokeswoman Marcelyn Love said in a statement. The state is signing nondisclosure agreements to shield the identity of companies that are getting relief from Illinois' punishingly high taxes? Doesn't that sound like a recipe for corruption?

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Federal Reserve Bank of St. Louis President James Bullard...

....said the European sovereign-debt crisis has surpassed rising oil
prices to become the biggest risk to the economic outlook in the U.S

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President Obama's daily Gallup approval rating....

...As of today is below 50% for 5 straight days for the first time since May 3. (48/43 today)

The peak after the Bin Laden liquidation was 52/40.

The all time low has been 41% which it was at for 2 straight days in mid-April 2011
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Huntsman eyes Florida as base for 2012 campaign

By Michael O'Brien [The Hill]

Former Ambassador to China Jon Huntsman is eyeing Florida for the
headquarters of his 2012 presidential campaign, should he decide to run.

Huntsman, the former Republican governor of Utah, could locate his
campaign headquarters in Orlando, smack dab in the middle of the key
swing state of Florida.

The decision to locate his headquarters in Florida can be attributed in part to the fact that his wife, Mary Kaye, hails from Orlando and has family and friends there. The state's also a big fundraising base, and the ability to win Florida is sometimes seen as a bellwether for a candidate's electability
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Michele Bachmann...

...may 'move up' 20112 decision, cites influx of support since Mike Huckabee backed out

If she steps into the race, Look for 200 straight "Hardball" shows to be devoted to Chris Matthews' clinical obsession with her
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Strauss-Kahn's latest twitter feed today

"IMF'd"
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Commodities...

...Are rising for the first time in 3 days on signs of increasing demand from Emerging Economies. Leading the pack are Silver and Sugar.
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Ten Year Treasury Yield...

...Currently around 5 month lows
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Confidence in the global economy...

...increased in the second quarter as
analysts grew more optimistic about the European environment, Germany's
Ifo research institute said, citing a quarterly survey

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Our Progressive White House

The White House Press Office has refused to give the Boston Herald full
access to President Obama's Boston fund-raiser today, in e-mails
objecting to the newspaper's front page placement of a Mitt Romney
op-ed, saying pool reporters are chosen based on whether they cover the
news "fairly."

"I tend to consider the degree to which papers have demonstrated to
covering the White House regularly and fairly in determining local pool
reporters," White House spokesman Matt Lehrich wrote in response to a
Herald request for full access to the presidential visit

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CNN...

...Featured a story on political sex scandals. Notably, they declined to mention current CNN employees Eliot Spitzer

As a side note, I have an issue with the Strauss-Kahn allegations being broadly labeled a "sex scandal". Rape or attempted Rape is a crime of violent assault. It is not the same thing as an extra-marital affair or involvement with a prostitute

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Gee, ya think?

The Obama administration strongly signaled it was time for the IMF to replace Strauss-Kahn as its chief indicating that he can longer be effective in his job -WSJ

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Mortgage applications...

...In the US rose for the third week in a row as falling mortgage rates fueled demand for refinancing. -CNBC
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Crude Oil Future...

...Rises over 1% this morning lifting off a 12 week low. Gasoline future rises about same percentage amount
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Repeal of U.S. Oil Breaks Blocked in Senate

 From Bloomberg

The U.S. Senate blocked a bid by Democratic leaders to repeal $21 billion in tax breaks for five multinational oil companies and use the revenue to reduce the deficit.

The Senate voted 52-48, with 60 votes needed for the debate to proceed, after Republicans argued the legislation would raise gasoline prices and increase dependence on foreign oil. Democratic leaders said they would seek to resurrect the measure in budget negotiations with congressional Republicans and the Obama administration

Geithner: No ‘Magical Thinking’ to Fix Deficit

U.S. Treasury Secretary Timothy F. Geithner said budget deficits threaten to erode the nation’s economy and security and can’t be reduced with “magical thinking

Newt Gingrich apologizes to Paul Ryan

Republican presidential candidate Newt Gingrich apologized in a telephone call to House Budget Committee Chairman Paul Ryan (R-Wis.) on Tuesday afternoon for his remarks on “Meet the Press,” where the presidential candidate referred to Ryan’s Medicare proposal as “radical change.”

Read more at Politico