Daily Digest 2/21 - Silver Lease Rates Skyrocket, Drilling In Libya Suspended Over Unrest, Water And The Arab World

German Pubic Debt Rises Sharply In December

Pennsylvania school districts brace for severe cutbacks

Government shutdown threat looms over US budget fight

Michigan orders DPS to make huge cuts

Cuts in Education Could Lead to 20000 Layoffs (Florida)

Memphis considers layoffs of as many as 1400

City pension crisis at 'turning point' (Cincinnati)

Moody's Expects Additional US Municipal Defaults, FT Reports

El Dorado County faces big pension shortfall

Bahrain Debt Rating Lowered at S&P on Protest; May Cut Again

Wisconsin Governor warns 12000 State Workers could be fired

Nations May Expand Food Stockpiles, Subsidies, Traders Say

Record U.S. Cattle, Hog Prices Seen on Shrinking Herds, China

Illinois may seek federal guarantee of pension bonds

PBGC premium hikes in federal budget debated

New Peter Schiff video

http://vinceseconomicblog.wordpress.com/...

http://news.yahoo.com/s/ap/us_sci_oil_spill_lingers

When I read things like below, the contrarian in me says lookout for tought times ahead!!!

There are plenty of indications that the economy is shifting into higher gear. And they are not just buried in economists' models and spreadsheets, but evident in the day-to-day decisions consumers and business folks make.

http://finance.yahoo.com/banking-budgeting/article/112150/signs-economy-is-on-the-upswing

Re: What does the Arab world do when its water runs out? As we know, there will be massive crises in the Middle East as resources such as food and water become scarcer and more expensive - while at the same time the people in these countries continue to proliferate.

Let me be the first to predict that there will be Arab land grabs in sub-Saharan Africa because of this, as they look longingly at the lush green jungles. Either they'll bribe the corrupt governments or they'll settle their own people there with incentives or by force.

That said, this other thing scares me: Illinois may seek federal guarantee of pension bonds. (Thanks for posting, Saxplayer!) All these years, both Republican and Democrat state lawmakers in numerous states have been refusing to fully fund the pension obligations (Virginia, Maryland, many others have actually contributed little or zero in order to balance their budgets) that they have promised public employee unions. They kept pushing it to future lawmakers.

And now they want a bail-out?!? (And I'm sure they'll say, "but Wall Street got one!")

Poet

Great interview today from Max Keiser

http://vinceseconomicblog.wordpress.com/...

Sorry for all the videos today but you have to see this interview with Dmitry Orlov very powerful

http://vinceseconomicblog.wordpress.com/...

Reports of warplanes bombing protesters in Tripoli

http://www.abc.net.au/news/stories/2011/...

There are reports from Libya that warplanes have begun indiscriminate bombing across the capital, leaving scores dead, as long-time leader Moamar Gaddafi clings to power.

There is chaos in Tripoli where buildings have been set alight and residents have described a massacre in the Tajura and Fashlum districts.

Protesters have reportedly taken control of several cities in the country's east and Mr Gaddafi's regime appears to be crumbling as senior officials desert their posts.

A man calling himself a Libyan resident told Al Jazeera television that warplanes and helicopters have begun bombing one area of Tripoli after another and there are "many, many dead".

"Every 20 minutes they are bombing" he said.

"Our people are dying. Anyone who moves, even if they are in their car they will hit you."

There are also reports helicopters carrying African mercenaries have landed in the streets of Tripoli and have begun firing on residents.

Libyan authorities are refusing foreign journalists entry to the country and phone connections are down so it is difficult to verify the reports.

Two Libyan Air Force fighter pilots defected and flew their jets to Malta where they told authorities they had been ordered to bomb protesters, Maltese government officials said.

They said the two pilots, both colonels, took off from a base near Tripoli. One of them has requested political asylum.

<http://www.nytimes.com/2011/02/16/technology/16internet.html>

By JAMES GLANZ and JOHN MARKOFF

Published: February 15, 2011

Epitaphs for the Mubarak government all note that the mobilizing power of the Internet was one of the Egyptian opposition’s most potent weapons. But quickly lost in the swirl of revolution was the government’s ferocious counterattack, a dark achievement that many had thought impossible in the age of global connectedness. In a span of minutes just after midnight on Jan. 28, a technologically advanced, densely wired country with more than 20 million people online was essentially severed from the global Internet.

The blackout was lifted after just five days, and it did not save President Hosni Mubarak. But it has mesmerized the worldwide technical community and raised concerns that with unrest coursing through the Middle East, other autocratic governments — many of them already known to interfere with and filter specific Web sites and e-mails — may also possess what is essentially a kill switch for the Internet.

Because the Internet’s legendary robustness and ability to route around blockages are part of its basic design, even the world’s most renowned network and telecommunications engineers have been perplexed that the Mubarak government succeeded in pulling the maneuver off.

But now, as Egyptian engineers begin to assess fragmentary evidence and their own knowledge of the Egyptian Internet’s construction, they are beginning to understand what, in effect, hit them. Interviews with many of those engineers, as well as an examination of data collected around the world during the blackout, indicate that the government exploited a devastating combination of vulnerabilities in the national infrastructure.

<http://www.smh.com.au/opinion/politics/a-new-food-crisis-is-on-our-plates-20110221-1b2f3.html>

The world has entered a new food crisis. Prices have surged, contributing to unrest in the Arab world. The president of the World Bank, the former US deputy secretary of state Bob Zoellick, last week warned that global food prices are at "dangerous levels."

It's part two of the crisis that started in 2007-08, which led to food riots in 18 countries. Prices in 2008 reached their highest since 1845, in inflation-adjusted terms, according to the Economist magazine's index, before slumping. The crisis seemed to have solved itself.

But last month, global food prices actually broke the record, according to the experts at the UN's Food and Agriculture Organisation. Over the past year the price of corn has risen 52 per cent, wheat 49 per cent and soybeans 28 per cent.

Rising food prices have pushed an extra 44 million people into poverty in the past seven months, according to the World Bank. It's even being felt in the rich world. In Australia, the opposition hopes to capitalise on it: "The year will begin and end with Australian families facing an ever-rising cost of living," the Liberal Party's Joe Hockey said in a speech last week.

Alarmed at spiking food prices, a score of countries, including big food suppliers such as Russia and Ukraine, have banned food exports to make sure they can feed their own people first.

This has provoked further alarm. Britain's environment minister, Caroline Spelman, argued last month that it should be illegal for countries to halt food exports, even in an emergency.

At the same time, the British government's chief scientific officer, Sir John Beddington, declared that "the case for urgent action in the global food system is now compelling".

The Group of Twenty major economic powers, which includes Australia, agreed. But meeting in Paris on the weekend, the G20 finance ministers notably failed to do anything about it.

Thomas Malthus warned in 1798 that growing population would starve humanity. The world population at that time? About 800 million. Two centuries later, it's about 6.9 billion. The world population is now growing at about 210,000 a day.

After being proved wrong for so long, is Malthus finally about to be vindicated?