Who’s Buying Whom
Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)
DOW + 65 = 17,763
SPX + 7 = 2066
NAS + 6 = 4886
10 YR YLD + .03 = 1.90%
OIL – .81 = 49.28
GOLD – 1.10 = 1203.00
SILV – .18 = 16.86
Iran and six world powers, including the US, has agreed to a framework for a final deal on Iran’s controversial nuclear program. The understanding still needs to work out some details but it paves the way for the start of a final phase of talks that aims to reach a comprehensive agreement by the end of June. The agreement concludes weeks of intense negotiations and comes two days beyond the initial March 31 deadline for an outline deal.
Iran has accepted limitations on its enrichment capacity that include retaining only one enrichment facility. Europe and the United States will end nuclear-related economic and financial sanctions on Iran under the future deal after the United Nations’ nuclear agency confirms Tehran’s compliance with the deal.
The standoff over Iran’s nuclear program has dragged on for more than a decade. In November 2013, both sides concluded a preliminary agreement that froze some of Iran’s most sensitive nuclear activities in return for limited sanctions relief. The parties also agreed to reach a conclusive deal by June 2015.
Shortly after the agreement was announced, President Obama read a statement in the Rose Garden of the White House, saying the framework agreement on Iran’s nuclear program as a “good deal” that would block Tehran from obtaining an atomic weapon and make the world safer – a better option than another Middle East war. Obama said there was always the possibility Iran would try to cheat on the deal. But if it did so, he said, the agreement’s framework of inspections and transparency would make it far more likely the United States would know about it, and any US president would still have “all of the options that are currently available to deal with it.”
The situation in Yemen continues to deteriorate. Houthi fighters and their allies seized part of Aden, a strategic port city. Aden lies near the Bab el-Mandeb Strait, which is one of the world’s oil chokepoints. Most exports from the Persian Gulf that transit the Suez Canal and SUMED Pipeline pass through Bab el-Mandeb.
Gunmen from the Islamist militant group al Shabaab stormed a university in Kenya and killed at least 150 people this morning, 80 others were injured in the worst attack on Kenyan soil since the US embassy was bombed in 1998. The gunmen spared Muslim students and either killed Christian students on the spot or took them hostage. The 15 hour siege ended when police and soldiers killed the four gunmen.
Greece has submitted a new list of reforms to its creditors. Greece’s government provided a lengthy list of reforms, which included new revenue streams. The plan also proposes an increase in spending on some government programs. An unnamed eurozone official noted, the proposals are a “very long way from being a basis [for a deal].” Meanwhile, The European Central Bank has increased its emergency assistance to Greece. Greek banks are now eligible to receive $77 billion through the ECB’s Emergency Liquidity Assistance program. The measure provides more liquidity for the country’s struggling lenders.
The Labor Department reports 268,000 people applied for unemployment benefits in the period stretching from March 22 to March 28, down 20,000 from the prior week. For four straight weeks initial claims have tracked below 300,000, a key threshold typically associated with a strengthening labor market. New applications for benefits are also running about 19% below year-ago levels.
The employment report for March will be released tomorrow morning, even though the markets will be closed in observance of Good Friday. Estimates for job gains are now running between 240,000 and 255,000. Yesterday, ADP said job creation in March was the weakest in 14 months.
The Commerce Department reports factory orders rose 0.2% in February, breaking a six-month streak of declines. However, January’s data was revised to show a 0.7% decline instead of a previously reported 0.2% drop. Excluding transportation, orders rose 0.8% in February. Shipments rose 0.7%.
The U.S. trade deficit declined by $7.2 billion, or 17%, to $35.4 billion in February from a revised $42.7 billion in January. The trade deficit is now at its lowest level since 2009, largely because of lower oil prices; however another possible cause for the lower trade numbers could be the lingering effects of a port slowdown on the West Coast; many companies complained of a shortage of key imported materials or saw their unsold products slated for export pile up on docks as negotiations dragged on.
Yesterday we told you that California was enacting mandatory water restrictions in response to the state’s worst drought, so it seems inevitable that we would start hearing stories of H20 abuse in the Golden state. The first culprit on the block: Nestle, the Swiss food giant, and also a major player in bottled water. Seems Nestle drew 50 million gallons from Sacramento sources last year, less than half a percent of the Sacramento Suburban Water District’s total production. It amounts to about 12 percent of residential water use. In other words, Nestle may be bottling more than locals drink from the tap. Consumers can only blame themselves, of course, for buying so much bottled water. The average price for a gallon of the bottled water is $1.21. For just $1.60, Californians could purchase 1,000 gallons of tap water.
Union Station is the railway and subway line that serves Washington DC; it is right next to the US Capitol and the SEC. And there is now an advertisement on the walls of Union Station featuring the cartoon likeness of Securities and Exchange Commissioner Mary Jo White dressed as a superhero, urging White to rein in corporate campaign contributions.
The Supreme Court ruled in the 2010 Citizens United case that companies and unions could spend unlimited money on election ads. While companies are required to report donations made through political action committees, they don’t have to report contributions to third parties, including industry groups such as the US Chamber of Commerce, which fund ads for and against candidates; this is often called dark money.
Supporters of the SEC’s involvement say shareholders deserve to know about political activity that could be contrary to shareholders views or possibly offend customers and impact a company’s sales. Skeptics, including many business groups and securities lawyers, say political spending is an insignificant cost.
So far, Commissioner White doesn’t think corporate campaign contributions are important enough to disclose because they don’t “primarily inform investment decisions.” Which is absolutely true; nobody has information on the contributions so there is no information to inform a decision. If you are the shareholder in a company, it just seems that you should know which politicians you are buying.
An incredible 97 percent of Americans, Democrats and Republicans alike, agree: the time has come to end government corruption in America. The only people who don’t want to see an end to corruption are the politicians. It seems unlikely that our current Congress, hot off the heels of the most expensive midterm election in US history, will usher in reforms to limit special interest money in politics; the dark money from mega donors has already started to pour in for the 2016 presidential election. Since the SEC doesn’t quite understand that sunshine is the best disinfectant, about the only way to shine a light on dark money is through executive action. With just the stroke of a pen, there’s something President Barack Obama can do today to help fix the problem. He can issue an executive order requiring the political spending of government contractors, which includes many of our country’s biggest corporations, be disclosed.
An executive order would expose this spending to the light of day and allow the public to follow the money. It would help restore a democratic process that all Americans can believe in. The basic idea would apply to all contracts of $5 million or more and to aggregated donations of $10,000 or more from directors, officers and/or any employee of the corporation or its subsidiaries; it would require that the head of the corporation and its subsidiaries attest that all donations, including dues to agencies or associations with a history of electioneering, are fully disclosed. To remain compliant with federal law, it would mandate disclosure after the contract is awarded. It would archive all data in a searchable, downloadable format on the data.gov website. Voters would know which corporations are trying to buy political influence and could call them out on it.
After all, government contracts provide funding for critical services and should go to companies best-suited to do the work, not those that can best game the system. All dark money is concerning. But when it’s from a federal contractor and could be used or perceived to be used in an attempt to sway the contract-award process itself, it’s particularly alarming because it has the appearance of conflict of interest. But it rises from alarming to obscene when the donated money is skimmed from a government subsidy or tax exemption. The upshot is a closed loop in which taxpayer money flows in and out of politicians’ pockets and back to the corporate bribers.
The Supreme Court has underscored not just the constitutionality but also the importance of the disclosure of political spending. Justice Anthony Kennedy wrote about just this in his majority opinion for the Citizens United ruling in a section that eight of the nine justices joined — all but Clarence Thomas. The court noted that transparency allows voters to “make informed decisions and give proper weight to different speakers and messages.” Justice Kennedy wrote: “Shareholders can determine whether their corporation’s political speech advances the corporation’s interest in making profits, and citizens can see whether elected officials are ‘in the pocket’ of so-called moneyed interests.” That sounds good, but it hasn’t happened.
There is no single solution to the problem of Big Money corruption in politics but closing your eyes doesn’t make the problem go away; shining a light on the problem would at least let us see who’s buying whom, and who’s selling what.
No comments:
Post a Comment