Spain jobless rate tops 20%, adds to debt worries

Spain is sometimes held up as the poster-child for the green economy. The reality seems to be a bit different.

From Yahoo! News:

Spain’s jobless rate topped 20 percent in the first quarter, national statistics institute INE said Friday, fueling fears over the country’s public finances which have rattled global financial markets.

The number of unemployed jumped by 280,200 to 4.61 million, more than in Germany which has nearly twice Spain’s population, for a jobless rate of 20.05 percent. The unemployment rate rose from 18.83 percent in the fourth quarter.

The last time the unemployment rate topped 20 percent in Spain was in the fourth quarter of 1997 when it hit 20.11 percent.

Spain’s jobless rate has soared since the global credit crisis hastened the collapse of its labour-intensive construction industry at the end of 2008.

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Failure Is the Only Reform We Need

From USAWatchdog.com:

By Greg Hunter

There was lots of talk this week about financial reform for Wall Street.  The President gave a speech yesterday on the legislation that is making its way through the Senate.  Obama said, “It is essential that we learn from the lessons of this crisis so we don’t doom ourselves to repeat it and, make no mistake, that is exactly what will happen if we allow this moment to pass – and that’s an outcome that is unacceptable to me and it’s unacceptable to you, the American people.” On this reform, I am squarely behind the President because it was unregulated, reckless Wall Street bankers that caused the lion’s share of the crisis.  They should not be allowed to fail and bail again.

I think the biggest problem this reform will address is the murky waters of the $600 trillion derivatives market. (Some say the derivatives market is more than a quadrillion bucks.)  This is a dark unregulated pool of all sorts of exotic complicated securities with no standards, regulation or public market.  No public market means there is no real way to set a value, such as in the oil market, the stock market or the bond market.  That’s why you hear Wall Street big wigs say “derivatives are hard to price.”  (It is hard to put a value on junk.)  If there was a public market, you would find out what traders would be willing to pay for it.  This is the same as putting a house on the market.  It is only worth what someone is willing to pay for it.

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One-Fourth of Nonprofits Are to Lose Tax Breaks

From The New York Times:

As many as 400,000 nonprofit organizations are weeks away from a doomsday.

At midnight on May 15, an estimated one-fifth to one-quarter of some 1.6 million charities, trade associations and membership groups will lose their tax exemptions, thanks to a provision buried in a 2006 federal bill aimed at pension reform.

“It’s going to be an unholy mess once these organizations realize what’s happened to them,” said Diana Aviv, president of the Independent Sector, a nonprofit trade group.

The federal legislation passed in 2006 required all nonprofits to file tax forms the following year. Previously, only organizations with revenues of $25,000 or more — or the vast majority of nonprofit groups — had to file.

The new law, embedded in the 393 pages of the Pension Protection Act of 2006, also directed the Internal Revenue Service to revoke the tax exemptions of groups that failed to file for three consecutive years. Three years have passed, and thus the deadline looms.

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$830,000 in job funds to Oakland questioned

Of course, this is just an isolated incident, and in general the stimulus package has done a great job of righting the economy. Oh, sorry, that was sarcasm, for those who didn’t notice.

From SFGate.com:

Federal stimulus dollars intended for job creation in Oakland were spent instead on trips to the Santa Cruz Beach Boardwalk and a Concord water park, rent, church repairs, bus passes, salaries and car allowances, according to a state review released Tuesday.

Oakland, which has struggled with a 17.7 percent unemployment rate, received $3 million last year for summer youth, adult and dislocated worker programs. But more than $830,000 of the money received under the American Recovery and Reinvestment Act from February to December 2009 was not properly accounted for or was misspent, according to the state Office of the Inspector General.

In addition, state auditors found the city inflated the number of jobs created, claiming 35 when only about six jobs were created with the stimulus dollars.

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Democrats Have Increased Taxes by $670 Billion and Counting…

http://republicans.waysandmeans.house.gov/UploadedFiles/DemTaxIncreases1.pdf

New York Offers Costly Lessons on Insurance

Coming soon to the rest of the country. All those things people said would happen, like higher costs and such, which the Main Stream Media said wouldn’t happen… looks like they’re gonna happen. Surprised?

From The New York Times:

When her small executive search firm in New York City canceled its health insurance policy last year because of the recession and rising premiums, April Welles was able to buy her own plan and still be covered for her cancer and multiple sclerosis.

She was lucky to live in New York, one of the first states to require insurance companies to offer comprehensive coverage to all people regardless of pre-existing conditions. But Ms. Welles, 58, also pays dearly: Her premium is $17,876 a year.

“That’s a lot of groceries,” she said.

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The Latest Gold Fraud Bombshell: Canada’s Only Bullion Bank Gold Vault Is Practically Empty

From ZeroHedge:

Continuing on the trail of exposing what is rapidly becoming one of the largest frauds in commodity markets history is the most recent interview by Eric King with GATA’s Adrian Douglas, Harvey Orgen (who recently testified before the CFTC hearing) and his son, Lenny, in which the two discuss their visit to the only bullion bank vault in Canada, that of ScotiaMocatta, located at 40 King Street West in Toronto, and find the vault is practically empty. This is a relevant segue to a class action lawsuit filed against Morgan Stanley, which was settled out of court, in which it was alleged that Morgan Stanley told clients it was selling them precious metals that they would own in full and that the company would store, yet even despite charging storage fees was not in actual possession of the bullion. It appears that this kind of lack of physical holdings by all who claim to have gold in storage, is pervasive as the actual gold globally is held primarily in paper or electronic form. Lenny Organ who was the person to enter the vault of ScotiaMocatta, says “What shocked me was how little gold and silver they actually had.” Lenny describes exactly how much (or little as the case may be) silver was available – roughly 60,000 ounces. As for gold – 210 400 oz bars, 4,000 maples, 500 eagles, 10 kilo bars, 10 one kilogram pieces of gold nugget form, which Adrian Douglas calculates as being $100 million worth, which is just one tenth of what the Royal Mint of Canada sold in 2008, or over $1 billion worth of gold. As Orgen concludes: “The game ends when the people who own all these paper obligations say enough and take physical delivery, and that’s when the mess will occur.”

Also note the interesting detour into what Stephan Spicer of the Central Fund Of Canada, said regarding his friend at a major bank, who wanted access to his 15,000 oz of silver, and had to wait 6-8 weeks for its to be flown in from Hong Kong.

It is funny that central bankers thought they could take the ponzi mentality of infinite dilution of all assets coupled with infinite debt issuance, as they have done to fiat money, and apply it to gold, in essence piling leverage upon leverage. They underestimated gold holders’ willingness to be diluted into perpetuity – when the realization that gold owned is just 1% of what is physically deliverable, you will see the biggest bank run in history.

Link to full Eric King interview.