The Mess That Greenspan Made - Part 415

Inflation at Three-Year High of 3.9%

The Labor Department reported that the rising cost of energy products and food drove consumer prices 0.3 percent higher in September and that the annual inflation rate now stands at 3.9 percent, the highest level since September 2008.

Paced by a 2.9 percent rise for gasoline, up 33.2 percent on a year-over-year basis, overall energy prices jumped 2.0 percent last month and are now up 19.3 percent from a year ago.

Food & beverage prices rose 0.4 percent in September and are now 4.5 percent higher than last year at this time while the “food at home” subcategory rose 0.6 percent for the third month in a row, now up a stunning 6.3 percent on a year-over-year basis.


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Wednesday Morning Links

Spain downgraded, Merkel & Sarkozy to talk – Reuters
Ghost of Lehman haunts European – Washington Post
The new normal: Higher bank fees are here to stay – AP
Deficit Panel May Need Push, Lawmakers Say – NY Times
Voters say Washington is worse than Wall Street – The Hill
Ron Paul’s Radical Vision of a Smaller Washington – Fiscal Times
Let’s Merge the Tea Party and OWS: Part II – Sense on Cents
Why Rush Limbaugh Is Freaking Out About OWS – Taibbi, Rolling Stone
Everyone is catching on about Fed policy – Credit Writedowns
Our most excellent adventure in NYC – The Burning Platform
Harrisburg Fails to Get the Word – aucontrarian
Harder money? – Politico

Oil up near $89 after US crude supplies drop – AP
Gold Drops on Report of European Rescue Fund – Bloomberg
Are ETFs responsible for short-covering rallies? – FT Alphaville
Alternative investments aren’t for everyone – MarketWatch
Gold to average $1875 in Q4; move to $1300 acceptable – Commodity Online
Dollar falls amid France rating concerns, Bernanke comments – xinhuanet
Why analysts are predicting lower metal prices – StockHouse
Chris Kimble’s Commodity Wreck Chart – Reformed Broker
Alternative Misery Index drives gold demand – USA Gold
A recipe for stock market volatility – MarketWatch

Student loan debt hits record levels – USA Today
Economics has met the enemy, and it is economics – Globe & Mail
Bank of England voted 9-0 to pump £75bn more into UK economy – Guardian
PBOC: Major China Stimulus Not Needed as Growth Is ‘Sound’ – Bloomberg
Strike shuts down Greece before austerity vote – Reuters
China cuts holdings of US debt after ratings downgrade – BBC
Number of Californians entering foreclosure jumps in Q3 – LA Times
Gloom Grips Consumers, and It May Be Home Prices – NY Times
Romney in Las Vegas: Don’t stop the foreclosure process – Housing Wire
Fed & BofA Dump Billions in Losses onto Taxpayers – The Big Pitures
Bernanke: Fed should keep eye on financial bubbles – Washington Post
Lessons From the Financial Crisis – Economix


I”ve yet to have a look at the GOP debate this evening that, according to the news headlines, focused a lot of attention on Herman Cain’s 9-9-9 tax plan and had Mitt Romney and Rick Perry squaring off against. It likely didn’t draw much attention to Ron Paul, something which, according to the chart below from he’s probably used to.

Earlier, Paul unveiled his economic plan that would reduce the budget deficit by $1 trillion – no, not over ten years, over one year! Paul’s “Restore America” plan includes tax cuts and a 10 percent reduction in the government workforce that would eliminate the Departments of Education, Commerce, Energy, Interior and Housing and Urban Development.

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Goodbye Wells Fargo, Hello Credit Union

Wells Fargo just reported its third-quarter earnings and, apparently, all is not well at the nation’s fourth-largest bank, as revenue and earnings came in at $19.6 billion and $4.1 billion, respectively, short of analysts’ estimates.

Too bad.

Don’t look for any help from me in doing better in the fourth quarter.

It really does seem to be the “least bad” of the Too-Big-To-Fail banks in the U.S. – far better than Citigroup, Bank of America, JPMorgan Chase, and the other organizations the government has bailed out before, and will bail out again when the time comes. But I’m still closing my account with them and moving my money back to a credit union or elsewhere.

To date, the bank has been pretty good about not nickel-and-diming its customers (or at least not nickel-and-diming the customers who pay close enough attention), but the recent change of terms it announced for checking accounts was a step too far, and now I’m voting with my feet.

On November 5, there will be a nationwide effort to move money away from the TBFT banks and into smaller banks and credit unions, so it’s probably not a bad idea to beat the rush.

(Continue reading this article at Seeking Alpha.)

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