I'll be on "Bulls & Bears" on the Fox Business Network this afternoon!

Tune in at 4pm ET on the Fox Business Network to watch me on the show, "Bulls & Bears."

Dow headed back to 11,000

From credit spreads to emerging market currencies many signs are popping up, which suggest that the "cardiac arrest" the global markets experienced after the failure of Lehman last September, has come and gone.

One by one, asset prices are returning to their pre-Lehman levels and there's no reason why stocks should not do the same.

The Dow closed at 11,421 on Friday, September 12. That Sunday Lehman collapsed and by the close of trading on Monday, September 15, the Dow was lower by over 500 points.

With conditions normalizing I see no reason why the Dow cannot regain that 11,400 level.

Enjoy the ride!

Extreme job contraction portends sharp rebound

The chart above is an historical look at the change in nonfarm payrolls from the previous quarter. You have to go all the way back to 1975 to see a period of job contraction as severe as the one we are in now.

That's the bad news.

The good news is that the periods that have witnessed such intense job destruction have been followed by sharp and sustained recoveries. From the trough in 1975 to the peak in 1978, job creation surged at a blistering pace, culminating in an extreme, almost giddy, pace of hiring.

It is quite likely that the same thing will happen this time. If you want to profit on this expected trend as an investor, buy the employment services stocks like Monster Worldwide (MWW) and Korn Ferry (KFY).

Frustration of the bank bears mounts

A column that appeared in yesterday’s Wall Street Journal pretty much summed up the frustration of a group I like to call the “bank bears.” The headline read, “Banks need fewer carrots and more sticks. Insolvent institutions should be taken over by the FDIC.”

It seems that there is a rising sense of frustration among this group because the government is not letting a larger swath of the banking system, that they believe to be insolvent, go under.

The claim that government is not letting bad banks fail is just flat out wrong. Last I checked the FDIC has a public list of about 100 institutions that have so far been closed and the vast majority of those closures happened in 2009. Apparently this fact doesn’t stop the Wall Street Journal from publishing a misleading headline that doesn’t merely suggest, but states outright, that the FDIC is allowing insolvent institutions to continue operating.

One hundred bank failures in the past two years is, I guess, not enough for the bank bears. They want blood and unless they get it, preferably in a big name like Citi or BofA, they are prepared to go on howling about how the government is shielding the banks. This is nothing more than a de-facto nationalization they say, so why don’t the Feds fess up and say it??

What the bank bears should get over is that commercial banks have ALWAYS been agents of the government by virtue of the fact that their deposits are guaranteed by taxpayer dollars and bank assets and capital are all heavily regulated. In addition, banks have lifelines to the Fed. Therefore, by definition they are and always have been, quasi-governmental by nature.

When you hear guys like Glenn Hubbard or other Wall Street financial types (or those with ties to Wall Street) complain about such nonsensical “shielding,” you should think of it as nothing more than a cynical power grab. Once again it is Wall Street (non-bank financial sector) vying for control and dominance over our financial sector.

The fact that they get away with it is a testament to their cleverness: they brilliantly disguise these schemes behind a cynical façade of concern for the economy. The Average Joe, not knowing any better, sides with them even though the Average Joe will be a big loser if these guys succeed in destroying the banking system for their preferred, unregulated-and-everything-goes system of financial intermediation, where a relatively small number of people are rewarded with an inordinately large percentage of national income.

What Average Joe needs to understand is that if anyone should be allowed to fail it is precisely these unregulated non-bank entities that sap brainpower and productivity while injecting nothing of value into the real economy.

In the final analysis the banking system exists for the public purpose. If it didn’t it wouldn’t have its liabilities guaranteed by taxpayer money. Once you understand this the term, “nationalization,” becomes redundant. The bank bears ought to get over it.

Obama plans spending cuts totaling $17 billion

Read article here.

While this is just a small fraction of the $3.6 trillion budget and doesn't go into effect until October, you can see where his head is at on this. He truly believes that the government's means are limited and that new spending must be offset by cuts. Although he may feel like he is doing the "prudent" thing, this increases the chances that at some point we repeat the mistake of the 1930s and end up going back into recession after emerging from it. If so, it will hurt his chances for re-election. But again, this is still relatively small and does not threaten the current recovery and stock market rally.

One more point: Half the cuts are coming from non-defense programs indicating that although he ran on a platform that included ending the war in Iraq, the savings on defense spending are not being funneled into non-defense initiatives. Those who were expecting a "peace dividend" from Obama will be disappointed.

Bank of America: The Administration's new sacrificial lamb

So now the world knows, one day in advance of the day when it was supposed to be officially announced. Bank of America will have to raise at least $34 billion to comply with the Administration's long-awaited stress test.

These tests, the brainchild of Tim Geithner, former president of the New York Fed who failed to understand how to maintain the Fed's overnight interest rate at its target (I could teach my 8-year old son how to do it in about 2 minutes), but who now runs the Treasury, will have what he needs to bring down B of A CEO, Ken Lewis.

Three months ago this news would have toppled not just the CEO, but the bank entirely. Thankfully, we should be able to avoid that now.

However, make no mistake about it, this is meant to send a message from an Administration that is inordinately focused on public approval at any cost, that no bank is too big to skirt by the Geithner edict. Yet this is a policy course that is laughable in its complete lack of knowledge of the role of the banking system and its relationship to the government. It also fundamentally misunderstands or ignores the fact that bank earnings, asset performance and, hence, capital levels, are all pro-cyclical by nature. Nice timing, Tim!

As a shareholder of Bank of America I am obviously furious that the bank has been singled out like this, but I can't say that I didn't expect it.

Wall Street Firms Will Revert to Pre-Crisis Model

Read Bloomberg article.

Yes, that is because our policymakers believe that the financial sector is an integral component of national power, which it is not.

A simple banking sector that functioned as an agent of the Federal Gov't was enough to provide financing to build 2.6 million homes in 1972, five times more than the current number and about the same level of housing starts constructed at the peak of the boom in 2006.

But in 2006, this was done via a complex and highly unstable system of intermediaries, which is what Geithner and the current Administration are desperately trying to resurrect. Unfortunately, it appears that they will be successful and the "Casino Economy" will be reborn!

Roubini: Don't Believe the Stress Tests or the Bank Rally

Back on March 26 famed bear, Nouriel Roubini, said that stocks would go down and the banks are doomed. (I mentioned this in my blog back then.)

Here's where the market averages were back then:

Dow 7924
Philly Bank Index (BKX) 29.16
S&P Financial Sector Spdr (XLF) 943
S&P 500 816
Nasdaq 1545

Since that time the Dow is up 6%, the BKX has climbed 23%, the XLF has gained 25%, the S&P 500 is higher by 11% and the Nasdaq has leaped 13%.

Some "perma bears" may eventually throw in the towel and declare that the bear market is over and a new bull market has begun, but you can be certain that won't happen until stocks are significantly above current levels.

When it comes to Roubini, however, I will make this prediction: He will never, EVER, concede his bearish case for the United States because he harbors a deep resentment toward the country that made him rich and famous.

The good news is, Professor Roubini's 15 minutes of fame are nearly up and that goes for the likes of Peter Schiff, Mike Mayo and Meredith Whitney too!

Oh and one more thing...When Roubini says, "Don't believe the stress tests" he is right, but not for the reasons he puts forth. Investors shouldn't believe them because they are ill-timed. The economy is improving, which means that bank earnings will be rising, perhaps sharply.

Daily fiscal drain continues

April went out with a bang--a $68 billion fiscal drain from taxes and what appears to be a slowing rate of spending. Because April is tax month it's "normal" to see a net fiscal drain during the month and that's the reason for the old Wall Street adage, "Sell in May and go away." (Fiscal drain sets up a market downturn over the ensuing several months, until deficit spending restores private sector savings.)

However, May is so far shaping up to be a decent month and the reason for that is the huge, $455 billion stash of private sector savings that has been built up as a result of high levels of deficit spending. Were it not for this, the recent trend towards fiscal drain would have already tanked the market.

The thing to remember, though, is that private sector savings can only be sustained over the long-term through deficit spending and if the fiscal conservatives are in control then it is only a matter of time before private sector savings are drained and another downturn ensues.

For the time being we are okay, so enjoy the rally and continue to buy stocks on dips!

For some banks, stress tests could not be coming at a worse time

Signs are emerging everywhere that the economy is stabilizing and we could soon see positive economic growth. That's good news for banks, whose businesses are dependent upon the basic condition of the economy.

However, Tim Geithner and the Administration do not see it that way. They see the problem of the banks as one of inadequate capital. They do not realize that the quality of bank earnings and, thus, bank capital, are entirely influenced by economic conditions. In a weak economy bank earnings, assets and capital will suffer and in a robust economy, they will rise.

The soon-to-be-released "stress tests" will show that some banks, perhaps even a few large ones, will need to raise more capital. All else being equal this is probably not so terrible, particularly now that equities are rising. However, the stigma of having "failed" a stress test could imperil some banks whose shares are already very low. I am talking about Citigroup and Bank of America. (For purposes of disclosure, I own both.)

If the results of the stress tests force these institutions into the hands of the government it would be a terrible shame because it would be happening not because of insolvency or failure, but because of an ill-conceived, arbitrary and poorly timed "plan" that purports to be the solution to fixing the banking system.

Absolutely ridiculous!

Read full article in Bloomberg.

Libor Falls Below 1% for First Time as Credit Thaws

The credit spigots are opening! Read article.

GM's China sales surge 50 pct to monthly record

China will soon surpass the United States as the world's largest car market and GM is the largest automaker in China with the highest sales. Yet the Obama Administration and many Repbublican lawmakers say that GM is not "viable" and are pushing the company into bankruptcy! Absolutely crazy.

A forced, GM bankruptcy will not only affect the company's ability to produce vehicles in the United States (something that will have profound repercussions down the road), but may also impact its size and competitive position in China as GM is forced to sell good assets in order to meet the conditions of its bankruptcy.

This is stupid policy!

Japan's automakers were sustained by the government of Japan for decades through various means and this is the only reason they are in the position of preeminence that they are today.

Read full story here.

By sustaining GM the Federal Gov't would also be sustaining jobs, incomes and wealth-producing technology and capital, not just in the United States, but globally.

Time to sell bonds and buy stocks is now!

Have you seen these articles popping up in the past few days?

Bonds Outperform Stocks Over Last 40 Years

There's supposedly all this new "evidence" that bonds have outperformed stocks over the past 40 years. I've even seen advice on Yahoo Finance telling people they should dump their stocks and buy bonds! (Even though this purported trend seems to be getting long in the tooth!)

Well, if I've ever seen a contarian indicator, this is it!!

If you've been riding the big bond boom of the past two years (or 40 years), my advice is this: SELL YOUR BONDS AND BUY STOCKS!

Interest rates have bottomed and with all the global fiscal stimulus that has been enacted, we could be entering a period of stock market outperformance not seen since the end of the Great Depression. More importantly if you are a bond investor, expect central banks to act quickly and aggressively in "taking back monetary stimulus" because of their sensitivity over the hyperinflation issue (which is bogus, but they don't understand that).

Times certainly are "a changin!" GM Bankruptcy Probable as Obama Shields UAW Benefits

Read Bloomberg article here.

The paradigm shift is now in full swing.

Whether you like it or not, the paradigm of the past 30 years, which featured massive deregulation and free trade, and favored businesses (mostly large corporations) and investors over wokers, wages and benefits, is shifting. As the former loses its influence in Washington, the latter is taking on a new position of high importance.

No one should be surprised by this as Obama telegraphed it from the early days of his campaign. It just took 100 days for it to happen.

Many will lament that this marks the end of the American economy, but such statements may be nothing more than grand overstatement. Over the course of the past 220 years this country has witnessed far more pronounced swings in political ideology and the economy has survived and even thrived.

While the "Free to Choose" crowd probably had the right idea back in the mid-1970s, it seems pretty clear that the concept was taken to an extreme in recent years and its intent became perverted. The bust we just witnessed was due in no small part to a distortion of what was once a good philosophy. At least that's my opinion.

Shifting the playing field back toward workers and wages now is probably not a bad thing and the markets seem to agree, regardless of how intensely the financiers of Wall Street rail in protest.

Don't fear hyperinflation: Treasury sales are a powerful countervailing force

One of the most fascinating things to look at from an economic standpoint is the Daily Treasury Statement, which is available on the Treasury’s website (http://www.fms.treas.gov/dts/index.html).

It is an itemized list of all the daily payments and receipts of the federal government. If you want to know exactly how much the government spent on defense yesterday, that figure is there. So, too, are the payments for agriculture programs, NASA, interest on the debt, Social Security and everything else the government spends money on.

By the same token if you want to see just how much the government collected in taxes or from those pesky air transport security fees that you have to pay every time you buy a plane ticket, you’ll find those too.

When looking at the statement one is instantly struck by the fact that the government is spending and collecting money every day and usually it is spending more than it is collecting. This means that there is a net increase in money, in the form of reserves, flowing into the banking system. (Remember, these are just credits that occur from a keystroke on a computer.) Therefore, when the government spends in excess of what it takes in it is acting like a giant “money pump” pushing money into the economy.

So if the government is pumping money into the economy on an almost constant basis isn’t this inflationary? The answer is, it can be, if it is done without control.

That's where the story gets even more interesting.

In addition to all the daily payments and receipts on the statement you will also find the total sales and redemptions of government securities. Remember, when the government sells securities bank reserves go down and when it redeems securities, bank reserves increase.

Looking at the numbers one finds that in the current fiscal-year-to-date the government has sold $5.1 trillion of Treasury securities and it has redeemed $4.07 trillion. What this means is that the government has drained reserves by a net amount of over $1 trillion! At the current pace the government is on track to eliminate not only ALL reserves in the banking system, but the entire monetary base (reserves, bills and coins) as well! In other words, if left unchecked the government’s actions would cause the very foundation from which all money emanates to completely disappear! Another way to say this is that there would be no more money!

So you can see that by no stretch of the imagination is that inflationary. On the contrary, it carries the potential for a financial collapse of unprecedented proportions. But don’t worry because it’s not going to happen.

The reason it’s not going to happen is because there is a counterbalance to all this and that counterbalance is the Fed. Because the Fed sets interest rates it is OBLIGATED to provide whatever reserves necessary to sustain its interest rate. And since the Fed funds rate is now set at zero the Fed will have to continue to supply enough reserves to offset the drain caused by the sale of Treasuries.

Many people have said that it is going to be “very hard” for the Fed to contain inflation because it has fostered such a big increase in the monetary base (mostly reserves). But when you understand that the Treasury’s ongoing public debt sales constitute such an enormous drain on reserves you see that, in actuality, the Fed has to do very little to keep inflation in check because the Treasury’s doing all the work. In fact, the only thing the Fed really has to do is simply let its various lending programs expire. That alone would cause reserve balances to fall and the threat of inflation recedes.

Falling reserve balances would put upward pressure on interest rates, but the Fed could counteract that by maintaining the desired reserve level. However, once the Fed feels confident that the economy is on the mend it will surely adjust its interest rate higher and allow reserve balances to come down to the level so that its new target rate is sustained.

So you see, it’s not all doom and gloom. It’s really quite logical and like anything else, once you understand how it works it takes all the mystery and fear out of it. It’s just sad that the folks at Treasury and at the Fed don’t have some better P.R.

Mike Norman releases his new economic education video series: Pitbull Economics!

Long live the Capitalists!! Job Cuts Avert Catastrophic Quarter as Profits Excel

Capitalism often thrives at the expense of workers and wage earners. Here is a classic example: Q1 corporate profits weren't bad at all, but only because workers got laid off in massive numbers.

If you are going to survive in our current model, then you have to think like a capitalist: invest in stocks, own a business, seek to control capital--both physical and human.

If you think you're gonna get a good job that pays well and have long-term job security you're only kidding yourself. Even Obama is not on your side. Look at his remedy for the autoworkers: throw Chrysler to bankruptcy. GM is probably next. Good for capitalists, bad for workers.

Daily fiscal drain continues, but is market rally vulnerable?

The net, daily drain from tax collections continues (see chart below), but does that mean the stock market rally is vulnerable to a renewed decline?



The answer is, probably not. That's because two other things have occurred, or are occurring, at the same time.

First, bank credit appears to have stopped contracting. So whatever quantity of its own money the government siphons off as a result of tax collections, the private sector's money--credit--may be about to start flowing again.



Secondly, and perhaps most important, is the fact that households have a $455 billion cache of personal savings to draw from: near-record levels. This virtually ensures that the stock rally will continue, as long as confidence keeps improving.



Your strategy should continue to be to buy dips.

Dow 10,000 By Year's End? Some Pros Think It's Possible

A more positive outlook is starting to develop and that's bullish for stocks. Even so, there's also still enough pessimism for the market to climb that "wall of worry."

Obama's betrayal: No Iraqi peace dividend

Here's a dirty little secret that the liberals won't tell you. (That is, if they are even aware!)

There has been no Iraqi "Peace Dividend" so far under President Obama.

In the first quarter of this year, spending on national defense has declined by 1.1%,yet non-defense spending has only increased by 1,0%--a net loss in overall spending.

On the other hand, in the fourth quarter of 2008, defense spending under President Bush dropped 0.3% from the prior quarter and non-defense spending jumped 3.4%, meaning that President Bush gave the nation more of a "peace dividend" than the current, democratic/liberal president.

Sadly, most Republicans would probably be angry at Bush over this. They're too stupid to see how smart Bush really was!

Another beautiful example of how our belief system keeps us poor

First quarter GDP came in down, 6.1%, equating to a loss in output and national income of $125 billion.

GDP = C + G + I + NE Where, C=Personal consumption; G=Government spending and investment; I=Business investment and; NE=Net exports (exports-imports)

The three components of GDP that always tend to add to overall output--Personal Consumption, Government Spending and Investment and Business Investment--tell a very interesting story.



While personal consumption rose from Q4 2008, it is still $200 billion below the peak seen last year, so it remains weak. Business investment has plummeted--absolutely cratered!

But here is the shocking part: Governemnt spending and investment fell in the first quarter. FELL!!

With consumers tapped out, out of work or unable to get credit and with business seeing their profits fall or going bust and not able to get credit either, the only hope for an increase in GDP or just something that could arrest the decline would be HIGHER LEVELS OF GOVERNMENT SPENDING.

Yet, government spending is falling.

This is so sad because the only thing that precludes us from getting out of the mess that we are in now is a warped and fallacy-laden belief system that causes us to view government spending as bad, even as the facts show otherwise.

The longer we allow this to continue, the greater the risk that our economy loses competitiveness vis-a-vis other countries of the world. And if that happens, the true legacy that we leave to our kids and grandkids will not be higher levels of government debt, but a lower standard of living and more poverty.

It is an outrage and a great failing of President Obama that he has allowed this to happen. Because of a character flaw that causes him to feel the need to be surrounded by those who represent the status quo--or worse--deficit hawks and debt "terrorists" we are rapidly allowing the wealth producing capacity of our nation to waste away.

By the time anyone realizes it, it will be too late.

Tracking daily fiscal drain: April tax effect still not over

The government is still taking in more than it is spending on a daily basis due to the effect of April tax collections. This is fiscal drain or fiscal drag. It could mean the stock market is vulnerable over the next few days or weeks, however, at the rate the government is spending the fiscal drag will soon reverse to fiscal stimulus. The drag is already starting to diminish.

My recommendation is to buy stocks into any near-term dip that occurs. Like the one we are getting today!

Final results of the poll are in!

A total of 38% said that spreading the word was either going well or getting easier.(That's encouraging!) Only 2% said it was getting harder and 55% said it was basically the same.

Watch me on the Fox Business Network today at 4pm ET

Catch me this afternoon on Bulls & Bears on the Fox Business Network at 4pm ET!

Goldman Sachs Boosts Risk-Taking at Fastest Pace on Wall Street

"The reports of my death are greatly exaggerated" -Mark Twain

You gotta kill the beast.

The great failing of policymakers in the Obama Administration (and there have been many failures) was the decision to sustain the financial sector in its present form, where intermediaries like Goldman Sachs take huge, risky bets for outsized returns while adding nothing of value to the real economy.

This has already been shown to inject unecessary risk and instability to the entire financial system, while siphoning off brainpower that could be used in productive work.

For some reason, Obama has filled his Administration with Wall Street bankers and financial types who have slyly crafted policy to sustain and perhaps even enhance the power of their domain over the rest of the productive economy.

At the same time the commercial banking system, which itself is a construct of the Federal Government, is being largely deconstructed. Major chunks of the banking sector's assets (which, at least obliquely, are the property of the public) are being sold off to some of the very speculators who targeted these institutions for demise, with taxpayer guarantees against losses to boot!

For a president who, purportedly, ran for office as a representative of the middle class and the working man, this seems incomprehensible.

If you are not a member of the Wall Street clique, or feel left out and ignored by the president and his policy team, you should rise up and let your sentiments be known.

Barack Obama is a brilliant guy with huge potential, but I am starting to think that he has a character flaw that will do him in. It is his need for validation, which causes him to surround himself with people who look impressive from a distance, but who come from the same, ruling class that zealously guards the status quo.

Chris Walen of Institutional Risk Analytics said he's gonna do the "Mexican Hat Dance" on me!

Perhaps because we are rapidly approaching Cinco de Mayo, I don't know.

Anyway, Chris Whalen of Institutional Risk Analytics sent me this angry email after I sent him a note telling him that the Treasury will not be "reimbursing" the Fed(that's nonsensical, anyway!) for mark-to-market losses on some of the Fed's asset holdings. I also told him that the Fed already gave $15 billion in profits to the Treasury so far this fiscal year.

This was his email to me:

By the way, Fed expert, what is you loss estimate for all of the "assets" on the Fed balance sheet? That is the basis for my comment. Next time you tee off on me w/o doing your homework, I am going to do the Mexican hat dance on you Mike, in public. My guess is that the Fed could be facing hundreds of billions in impeded losses on its "assets." Since you did not bother to ask in your rude, discourteous note below, you have no chance to evaluate same. How does that affect you expert analysis? Better, keep your comments to yourself next time. Christopher Whalen Managing Director Office: 914-827-9272 Mobile: 914-645-5304 www.institutionalriskanalytics.com

And then I emailed him back and wrote:

Of the $2.17 trillion currently on the Fed's balance sheet approximately 41 percent of that amount is in risk free assets: Treasuries, Gov't agency securities (backed by Treasury) and foreign currency, where foreign CBs carry all the exchange risk.

That leaves $1.3 trillion of "other assets," which include MBS, Term Auction credit, Bear Stearns, etc. Let's assume it's ALL bad (you said, a couple of hundred billion; i'll go you one further and say, all).

Because the Fed can acquire assets for zero cost (it merely credits the reserve account of the seller's bank) it can easily acquire enough safe assets, to generate income that would go toward offsetting those losses.

Yes, it would take time and, yes, large-scale purchases of any asset, including Treasuries, would result in a reduction of the interest rate paid. However, the point is the Fed could easily grow its balance sheet, and its income, sufficiently, to offset whatever mark-to-market losses it may currently have.

The problem with you is, you're arrogant, a hot-head and you think you're somekind of genius, but you're not. I used to like you, and thought you had insights. It didn't take me long to find out that that was not true. Your last appearance on my radio show was a joke. My listeners could give you a good schooling. Better yet, they could do the Mexican Hat Dance on YOU!

-Mike

Monster Worldwide may be indicating that job losses are moderating

Look at the stock of Monster Worldwide (MWW). That company provides employment solutions, job search, etc. The stock has shot up sharply in the past month. It could be signaling that the worst is over for the job market.

"Sell in May" tax effect might be very brief this year, if at all

With the average monthly fiscal deficit running about $160 billion so far this year that old, "Sell in May" stock axiom may not work this year. If anything, it's likely to be fleeting so don't expect a big stock market downturn.

Normally it takes several months of deficit spending to replenish the wealth drain that hits the private sector when taxes are paid in April. Treasury data shows that the April '07 surplus of $178 billion was the second largest on record (the largest was April 2001: $190 billion). Both of these wealth drains preceded huge market declines.

It took four months of deficit spending following that April '07 drain to replenish the level of private sector net wealth that was taken away. Not surprisingly, when enough deficit spending finally occurred, the stock market rallied. The Dow was up 5%in September 2007.

This year the wealth drain is likely to be far smaller than in prior years thanks to a weak economy and with so many people out of work. However, government spending rolls on and at levels never seen before.

So far this month, the Treasury has collected about $200 billion in taxes. That's less than half of the amount collected in April of last year and even below the level in April 2002 when we also had a weak economy. Yet spending has been averaging over $320 billion per month. So whatever the net drain ends up to be for April--say $250 billion--most of all of that will be repenished in about 12 business days! That's pretty much where we are right now and the reason I believe the market correction that had been occurring since last Friday, is OVER!! So, BUY STOCKS, because this year is NOT the year to "sell in May and walk away."

Poll results suggest some hope

Here are the results of my poll question, "How are you finding the task of educating your friends and colleagues on in-paradigm economics?"

While 61% of the respondents said they are not making much progress at all, a combined, 36% said that they are making progress or that it is going well! Only 3% said it was impossible or harder than ever. The results are mildly encouraging.

Another misleading and misinformed article by Bloomberg "journalist," Mark Pittman

In the article he claims that the Treasury will have to "reimburse" the Fed for losses on its assets. The article is rife with misinformation.

Here is my letter to Pittman:

Dear Mark, Your journalism continues to misleading and misinformed. This ongoing claim about the Fed not disclosing what collateral it lends against is completely wrong and you know it. I've been all through this with you and you admitted to me that the collateral and margins are fully disclosed. Moreover, Bernanke gave the website out during recent Congressional testimony. Your story today about the Fed having to be reimbursed by the Treasury for mark-to-market "losses" on assets is laughable in its lack of understanding. What you fail to mention is that the Fed earns quite a bit of money on the assets it holds, and for the fiscal year to date the Fed has handed over $15 billion in PROFITS to the U.S. Treasury. Not that it makes any difference to you (because you are clearly averse to the facts), but here is the link where this information is publicly disclosed (Table II, line item that reads, "Federal Reserve Earnings"): http://www.fms.treas.gov/webservices/show/?ciURL=/dts/09042200.txt You are not a journalist; you're a novelist. Why don't you write a good conspiracy story? I think it would do very well as you have a vivid imagination. -Mike Norman

Here is Mark Pittman's email in case you feel inclined to tell him what you think of his agenda journalism. And if someone can get the name of Bloomberg's managing editor, that would be great. We need to be emailing this person as well to let them know that Bloomberg journalists are conducting personal-agenda-based journalism.