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Editor, The Konformist
"The 2009 budget deficit could be close to $2 trillion..."
Cost of U.S. Crisis Action Grows, Along With Debt
By Matthew Benjamin
Oct. 10 (Bloomberg) -- The global financial crisis is turning into a
bigger drain on the U.S. federal budget than experts estimated two
weeks ago, ballooning the deficit toward $2 trillion.
Bailouts of American International Group, Fannie Mae and Freddie Mac
likely will be more expensive than expected. States are turning to
Washington for fiscal help. The Federal Reserve said this week it
will begin buying commercial paper, the short- term loans companies
used to conduct day-to-day business, further increasing costs. And
analysts now say the $700 billion bank- rescue plan passed by
Congress last week may have to be significantly larger.
``I always assumed they would be asking for more money along the way
if it was necessary, and it looks like it's going to be necessary,''
said Stan Collender, a former analyst for the House and Senate
budget committees, now at Qorvis Communications in Washington. ``At
the moment, there's nothing happening here that's positive for the
The 2009 budget deficit could be close to $2 trillion, or 12.5
percent of gross domestic product, more than twice the record of 6
percent set in 1983, according to David Greenlaw, Morgan Stanley's
chief economist. Two weeks ago, budget analysts said the measures
might push deficit to as much as $1.5 trillion.
Yields to Rise
That means a lot more borrowing by Treasury, which will push up
interest rates, said Greenlaw. ``The Treasury's going to be ramping
up supply dramatically over the course of coming months to meet this
enormous federal budget obligation,'' Greenlaw told Bloomberg this
week. ``The supply will trigger some elevation in yields.''
Treasuries have fallen the past four days even as stocks sank, a
sign investors are preparing for bigger U.S. government borrowing.
Benchmark 10-year note yields rose to 3.82 percent at 7:49 a.m. in
New York, from a close of 3.45 percent Oct. 6.
Payments the government allocated to keep vital companies solvent
are beginning to look insufficient.
AIG, the giant insurance company that was taken over by the
government in mid-September, said this week it may access $37.8
billion from the Federal Reserve Bank of New York, in addition to
the $85 billion the government already loaned it to stave off
``You're in for a dime, you're in for a dollar on this one,'' said
David Havens, a credit analyst at UBS AG.
The financial health and earnings prospects of Fannie Mae and
Freddie Mac -- seized by the government on Sept. 7 to prevent them
from failing -- worsened in the second and third quarters, the
companies' government regulator said this week.
The companies and regulators are recalculating the value of all of
their assets to factor in price erosion. That may mean the
government will have to spend more to keep the firms solvent.
Earlier this week the Fed announced it will create a special fund to
buy commercial paper, the credit that businesses use to finance
payrolls and other ongoing expenses. The Treasury will deposit money
into the Fed's New York district bank to help set up the new unit. A
Fed official said Treasury funding for the program could be
California, Alabama and Massachusetts are urging the Fed and
Treasury to include their securities in rescue plans designed for
banks and businesses. The $2.66 trillion U.S. market for state and
city bonds has been all but frozen since Lehman Brothers Holdings
Inc., weighed down by losses in mortgage-backed bonds, declared
history's largest bankruptcy on Sept. 15.
California has said it needs to sell as much as $7 billion in notes
to maintain its schools, health system and other public services.
The Bush administration said it is reviewing the states' financial
Plan for Banks
Meanwhile, Treasury Secretary Henry Paulson indicated two days ago
that he is considering buying stakes in a wide range of banks in
coming weeks to help recapitalize them.
Such a move is allowed under the $700 billion bailout package
Congress passed last week. Edmund Phelps, winner of the 2006 Nobel
Prize for economics and a professor at Columbia University, said
such action is necessary -- and will likely turn out to increase the
measure's cost. Spending beyond the amount set in last week's bill
would require further Congressional approval.
``We have to recapitalize the banks,'' Phelps told Bloomberg
Television this week. ``I don't imagine that there's enough money in
the first Paulson plan to be able to do all that needs to be done in
The additional borrowing could push the national debt well past 70
percent of GDP, the highest since the immediate aftermath of World
War II, when the U.S. was still paying off war debt.
Gross U.S. debt, which includes debt held by the public and by
government agencies, this year reached about $9.6 trillion, or about
68 percent of gross domestic product. The rescue legislation
increased the government's debt limit to more than $11.3 trillion
from $10.6 trillion.
On top of all that, budget watchdogs say the sheer size of the
interventions is making Washington more profligate than usual. To
attract votes in Congress, leaders added several costly items to the
$700 billion rescue, including extensions of some tax credits and
tax breaks for makers of wooden arrows and stock- car racetrack
Under normal circumstances, there would have been more resistance to
such expenses, said Robert Bixby, executive director of the Concord
Coalition, a non-partisan budget watchdog.
The rescue legislation ``creates a mask for all sorts of fiscal
irresponsibility,'' said Bixby. ``It covers up a multitude of
To contact the reporters on this story: Matthew Benjamin at
Robalini's Note: Though this is from January, it is more relevant
What Obama Really Meant
America's fastest-growing quiz sensation is "What Obama Really
Here's how W.O.R.M. is played...
There are three teams and a special player called "The Unifier"
The teams are the Progressives, the Obama Fan Base, and the Grand
The goal for the Progressives is "Progress," meaning that players
who start the game with less money someday have a chance to have more
The goal for the Obama Fan Base is "Unity," meaning that the
Progressives have to stop their partisan bickering with the Grand
Old Party, and everyone gets ponies
The goal for the Grand Old Party is to take all of the money that
other players started the game with. And everything they'll ever
earn. And that their children will earn.
The goal for The Unifier is to be "Teh Awesome." And he is, he is!
In each round, The Unifier says something that's shockingly
disempowering to the Progressives
A skilled Unifier knows to hide the shockingly disempowering moment
in the middle of an otherwise perfectly accceptable, or even
If a Progressive spots the shockingly disempowering comment and
dares to face the onslaught from the OFB s/he presses the
Challenge Buzzer and explains the problems with the statement
The OFB besieges the Progressives. Every verbal tool is allowable,
According to the mainstream media, the game always ends in defeat
for the Progressives. The losers must wait four years or more for
Progress, during which the GOP cackles maniacally.
As a consolation prize, The Uniter offers Progressives "hope," which
is practically as good as Progress, isn't it?
At an undetermined date, the ponies arrive!
Here's an example of game play...
1. The Unifier kicks things off with a statement, such as:
Children are the future! Cotton candy is fun! Liberal heathens must
stop hassling the GOP. Everyone's getting a pony!
2. The Progressives either concede the game immediately, or a team
member presses the Challenge Buzzer and says something like:
"But the GOP and Religious Right are destroying our country!"
3. The Obama Fan Base encircles the Progressives and shouts
rebuttals, such as:
He said "Children are the future!" Isn't that the greatest thing you
When he said "liberal heathens," he meant, um, something really
good. Definitely. And the way he said it was inspirational!
Why must you hate Obama!? Why do you love Hillary so much!? If
Hillary is nominated, we won't vote, you Unity destroyer!
Don't you know that a black man can't be elected unless he throws
progressives under the bus?
You dirty hippies had your turn, and you ruined everything. Now it's
our turn, and God as my witness, the mellow will never be harshed
Ponies, dude. Ponies! Get with the program!
The Vast Left-Wing Conspiracy, now at my new home: Correntewire.com
YOUR VOTE COUNTS!!
Posted by Lava Cocktail at Monday, October 27, 2008
During the 'election' in November, please do the following:
1. Take your voter's registration card...
and burn it.
2. Send the ashes to:
CEO Diebold Corp
5995 Mayfair Road
P.O. Box 3077
North Canton, Ohio USA 44720-8077
A Toast to Your Psychic Health
'Deep Throat' Director Gerard Damiano Dies at 80
FORT MYERS, Fla. - Pioneering adult film director Gerard Damiano
died Saturday of complications from a stroke. He was 80.
A former hairdresser from the Bronx, N.Y., Damiano is best known for
directing the adult film classics Deep Throat and The Devil in Miss
Jones. The theatrical release of Deep Throat in 1972 created the
phenomenon of "porno chic," making it acceptable for couples and
celebrities to attend X-rated movies and changing the way the public
viewed explicit sex on screen.
Gerardo Rocco Damiano was born Aug. 4, 1928 to an Italian-Catholic
family. His father died when he was six, and his mother never
remarried. Damiano joined the Navy at 17 and served for four years,
later studying X-ray technology on the G.I. Bill.
Damiano opened a beauty parlor in New York City in 1956. He often
told the story that he realized sex films could have crossover
appeal after listening to the conversations of the women who made up
his salon clientele. Looking back on his career in 2005, he told the
Fort Myers News-Press that he became interested in moviemaking when
his accountant introduced him to an industrial film producer who was
shooting a low-budget horror feature.
During the late '60s and early '70s, Damiano directed sex
documentaries and "marriage manual" films including We All Go Down
(1969), Changes (1970), and Sex USA (1971). These early skin flicks
made Damiano part of a circle that included performers Harry Reems,
Jason and Tina Russell, Jamie Gillis, Fred Lincoln, Marc Stevens,
and Shaun Costello (who was later credited under Damiano's name as
director of the enema-bandit epic Waterpower.)
But it was Deep Throat that defined Damiano's career and
revolutionized adult cinema. Shot in six days on a shoestring budget
in Miami, the Linda Lovelace classic became an instant box-office
smash and a cultural event whose impact continues to be felt today.
Damiano first met Linda while he was casting a hardcore insert scene
for Changes. After witnessing her sexual talent, he was so impressed
that he spent the next couple of days writing a film just for her.
Damiano famously created the name "Linda Lovelace" for the star
after finishing his script, which became Deep Throat.
While Deep Throat is said by some to have grossed in excess of $600
million, Damiano did not share in those notorious profits. The
director sold his interest in the film after its release to his
producing partner Louis "Butchie" Peraino for a reported $25,000.
By the time Damiano made his follow-up film The Devil in Miss Jones
in 1973, he had become the adult film world's first real
auteur. "They invented a new word, filmmaker," he recalled in the
2005 documentary Inside Deep Throat. "Suddenly, there were
Actress Georgina Spelvin, who played the part of Miss Jones in the
seminal film, met Damiano through Harry Reems. Spelvin wrote about
her first encounter with "a real fuck-film director" in her recently
published memoir The Devil Made Me Do It.
"What's a nice girl like you doing in a porn shop like this?"
Damiano asked Spelvin. It was the beginning of a warm friendship
that would last for 35 years.
Devil was another highly influential success that fueled the "porno
chic" craze. The movie began and ended with Damiano himself playing
a memorable cameo role as the nameless, impotent mental case trapped
in an existential cell with the eternally frustrated Miss Jones.
Damiano went on to direct other acclaimed, high-profile adult
features including Memories Within Miss Aggie (1974), The Story of
Joanna (1975), The Satisfiers of Alpha Blue (1981) and Night Hunger
(1983). Outside the X-rated genre, he made the little-seen '70s
horror film Legacy of Satan.
Other notable Damiano credits include the cult classic Let My
Puppets Come (1976), Odyssey (1977), and People (1978), a
documentary-style experiment that might be considered the forerunner
of modern reality-porn videos such as Tristan Taormino's Chemistry.
Damiano married porn actress Paula Morton in 1975, and the couple
had two children, Christar and Gerard, Jr. The family moved from New
York to Fort Myers in the '70s. Although Damiano and Morton
eventually divorced, they remained close until his death.
Damiano flew back and forth to New York to work until he retired
from the business in 1994, having directed a total of 47 movies.
According to the News-Press, the legendary director "lived out his
final years in Fort Myers quietly, enjoying theatre, attending art
openings, appearing at charitable events and reveling, especially,
in the accomplishments of his two children."
Spelvin, Annie Sprinkle, and other industry friends joined Damiano's
family to celebrate with the director at a surprise 80th birthday
party this summer.
"When the lights came up and we all yelled 'Surprise,' I feared my
favorite director was going to bolt," Spelvin wrote. "He later
said, 'I haven't been that surprised since I was arrested.' He just
couldn't believe his loving former performers and pals had traveled
from New York and California just to nuzzle and hug and kiss him to
No memorial service is planned for Damiano. "That 80th birthday
party was a celebration of his life - while he was still alive," his
Contributions can be made in Damiano's name to AIM Healthcare
The Christian Science Monitor to Become a Weekly
The newspaper, which will cease daily publication next April and
emphasize the Web, becomes the most prominent paper to scale back
By Jon Fine
October 28, 2008
The Christian Science Monitor, which turns 100 years old this year,
is announcing on Tuesday, Oct. 28, that it will cease daily
publication next April. The newspaper will shift to a weekly print
format while increasing its emphasis on its Web site, says its
editor, John Yemma.
In doing so, the Monitor will become by far the most prominent
newspaper to scale back its print edition substantially.
The Monitor, an independent publication funded by the Christian
Science Church, is currently posting net losses of $18.9 million a
year on $12.5 million in revenue, say Monitor executives. Cutting
print frequency from its current five times a week to once a week is
expected to slice those losses to $10.5 million within five years,
said a spokesman. The Monitor's current circulation is 56,000. The
high-water mark for Monitor circulation was 223,000, a figure the
paper hit in 1970.
The Boston-based Monitor employs 130 staffers, about 100 of whom
work on the editorial side. Yemma conceded that the change would
result in layoffs, but he said the paper has yet to determine
exactly how many positions the revamped Monitor will require. Yemma
stated a desire to protect the Monitor's international coveragethe
daily has staffers in nine bureaus outside the U.S. and freelancers
covering other major regionswhich he described as the
paper's "crown jewels."
"The calculation has been that subscriptions [to the Monitor], which
cost about $210 a year," explains Yemma, "pay for half of the cost
of the newspaper, the rest of which is subsidized by the Christian
Science Church. That is an untenable situation" and one "that
doesn't foster editorial independence," he continued. "We want to
move to a sustainable model."
The Monitor is an odd duck among the flock of American newspapers.
It's protected from the rigors of the market, thanks to its
Christian Science benefactor. Its strong suit is sober analysis, not
breaking news. Its circulation revenues of around $11 million a year
far outstrip its ad revenue, which is under $1 million. Typically,
other major American papers invert that ratio, taking in much more
revenue from advertising. (Syndicated sales of the Monitor's
articles bring in another nearly $1 million a year, a spokesman
The Monitor's national circulation is concentrated mostly on the two
coasts and in other major urban centers, said Yemma. This makes it a
chore to get far-flung readers their weekday papers, as well as to
produce them. The Monitor's newsroom deadline is noon, which
naturally puts the print product at a severe disadvantage when it
comes to reporting on the prior day's events, albeit one that will
vanish when the Monitor's daily work is exclusively directed toward
its Web site. And the national scope of the Monitor, at least,
insulates it from the brutality of local city markets, which were
hard hit by real estate and automobile advertising slowdowns even
before the scope of the current economic crisis became apparent.
A Heftier Read
All those factors make the Monitor uniquely well-positioned among
newspapers to tread the path it has chosen. The precise debut date
of the weekly Monitor is not yet set, but when it is, its readers
will see a 44-page newsprint product, instead of the current 20-page
daily paper. Yemma said the Monitor tested a magazine-like weekly
publication, on glossy paper. But, he said, "our readers wanted
something that felt a little more newspaper-y."
Yemma pins many hopes for future success on the Monitor's Web
site. "If we can quintuple page views" and end up around 25 million
a month, "even on a low [advertising rate] model, we can cover our
costs." It's unclear, though, how the Monitor would go about doing
that. But another key Web indicator indicates that the Monitor has
much work to do online. According to comScore (SCOR), in September
the Monitor's Web site attracted 703,000 unique U.S. visitors.
This puts it far behind the U.S.-only totals of two British news
organizations that target a similar audience, the BBC and The
Guardian daily, which netted 6.6 million and 2.5 million unique U.S.
The Monitor's announcement comes on the heels of other grim
indicators for major U.S. papers. For instance, The Star-Ledger, the
largest newspaper in New Jersey, owned by Advance Publications,
announced on Oct. 24 it would reduce its newsroom staff by about
Fine is BusinessWeek's MediaCentric columnist and Fine On Media
Yahoo, AOL in due diligence on combination: source
Wed Oct 29, 2008
By Anupreeta Das
SAN FRANCISCO (Reuters) - Yahoo Inc and Time Warner Inc's AOL unit
are looking at each other's books to figure out how much money they
could make together and where costs can be saved, a person familiar
with the talks said on Wednesday, indicating a merger may finally be
on the way.
While noting a deal was not imminent, the source said the two
companies have engaged in "meaningful" due diligence about a
possible combination for the past couple of weeks.
Talks are focused on how to integrate AOL's content and advertising
business into Yahoo, said the source, who was not authorized to
speak publicly because the discussions are confidential.
Yahoo and Time Warner began talks several months ago, when the
Internet company was looking for an alternative growth strategy to
fend off a $47.5 billion takeover bid from Microsoft Corp.
Yahoo had repeatedly rejected Microsoft, which finally withdrew its
$33-per-share proposal in June after Yahoo cut a search advertising
partnership with Google Inc.
But the Google deal, also part of Yahoo's alternative strategy, is
mired in the regulatory process because critics have said it is anti-
competitive. Meanwhile, Yahoo shares have plunged to around $12.
Time Warner shares are down about 45 percent from year-earlier
levels, while Yahoo shares have fallen about 63 percent, as fears of
an economic recession curbed corporate spending on advertising while
Google continued to dominate in the Web search market.
Under the deal Yahoo and Time Warner have discussed, Yahoo would
fold AOL's content and advertising business into its own operations,
and Time Warner would get a stake in the combined company.
Executives and advisers from both sides met last week as part of the
due diligence process, the source said. Both sides are being
cautious because any potential deal carries "a lot of risk," the
source said, without providing further details.
Integration concerns would likely revolve around how to fold AOL's
advertising network into Yahoo's operations, choosing whether to
keep separate portals and email services, and squeezing out cost
savings by reducing duplication, one former AOL executive said on
condition of anonymity.
Yahoo and Time Warner declined comment. News of the due diligence
was first reported by the AllThingsDigital blog.
Shares of Yahoo were up 4 cents at $12.40 in late trading, while
Time Warner shares were down 15 cents or 1.5 percent at $9.95.
(Editing by Gerald E. McCormick and Brian Moss)