Worries that the economy is not likely to recover as soon as had been hoped drag on markets. Dow, S&P 500 and Nasdaq drop over 2%.
By Alexandra Twin, CNNMoney.com senior writer
Last Updated: June 15, 2009
NEW YORK (CNNMoney.com) -- Stocks slumped Monday as weaker oil prices and more geopolitical unrest raised worries that the recession may not be waning as soon as some had hoped.
The Dow Jones industrial average (INDU) lost 187 points, or 2.1%. After ending last week in positive territory, the Dow is now back in the red for 2009.
The S&P 500 (SPX) index lost 22 points, or 2.4% and the Nasdaq composite (COMP) fell 42 points, or 2.3%.
Wall Street has been steadily rising for three months on bets that the pace of the recession is waning, with the S&P 500 up 40% during that period. But a lack of new evidence to support the rally has left stocks rangebound over the last few weeks.
"People are re-evaluating the run up," said Kim Caughey, senior equity analyst at Fort Pitt Capital Group.
In the short term, she said that comments coming out of the Group of Eight finance ministers' meeting last weekend were exacerbating worries about the health of the global economy.
"At the conference, some countries expressed interest in pulling back on spending and that has some investors worried," Caughey said. "We're looking for those mythical green shoots of the recovery and you have people saying they are going to take the fertilizer away."
She said the ongoing weakness in the labor market and the outlook for consumer spending were also in play. And investors are starting to conclude that second-quarter results due out next month are going to remain lackluster.
"I think a selloff was way overdue," said Dave Rovelli, managing director of U.S. equity trading at Canaccord Adams. "There are some encouraging signs out there, but we are still in a recession."
In addition, geopolitical factors were in force, he said. "I think Iran adds fuel to the fire. But we also had comments from North Korea over the weekend about nuclear weapons, and that's a factor too."
A falling dollar has given a boost to oil, gold and other dollar-traded commodities of late, as well as the underlying commodity stocks. But the dollar was mixed Monday and the price of oil settled at $70.62.
Tuesday: A heavy spate of economic news is on tap, including reports on May housing starts and building permits. The Census Bureau readings, due before the start of trading, are expected to show modest improvements from earlier levels.
The June Producer Price Index (PPI), a measure of wholesale inflation, is also due out before the start of trade. The release, from the Labor Department, is expected to have risen from May levels, as is so-called core PPI, which strips out volatile food and energy prices.
The Federal Reserve releases its reports on industrial production and capacity utilization shortly before the start of trading.
On the move: Oil stocks such as Dow components Chevron (CVX, Fortune 500) and Exxon Mobil (XOM, Fortune 500) retreated. The Amex Oil index lost 2.8%.
Other commodity stocks fell in active trade as well, including aluminum producers such as Alcoa (AA, Fortune 500) and gold producers such as Yamana Gold (AUY).
But, declines were broad-based. A variety of tech shares slipped, dragging on the Nasdaq, including Intel (INTC, Fortune 500), Cisco Systems (CSCO, Fortune 500), Dell (DELL, Fortune 500) and eBay (EBAY, Fortune 500).
Intel and Cisco are Dow stocks. The Dow's other big losers were Boeing (BA, Fortune 500), United Technologies (UTX, Fortune 500), 3M (MMM, Fortune 500), General Electric (GE, Fortune 500), Merck (MRK, Fortune 500), Wal-Mart Stores (WMT, Fortune 500) and Johnson & Johnson (JNJ, Fortune 500).
All but 2 of the 30 Dow stocks suffered losses, with American Express (AXP, Fortune 500) and Microsoft (MSFT, Fortune 500) the two gainers.
Declines were broad-based across other major indexes as well.
Market breadth was negative and trading volume was moderate. On the New York Stock Exchange, losers beat winners by over five to one on volume of 1.15 billion shares. On the Nasdaq, decliners topped advancers by almost four to one on volume of 2.19 billion shares.
Iranian elections: The disputed presidential election has sparked violent protests in Iran, as reformist leader Mir Hossein Moussavi's declared loss to President Mahmoud Ahmadinejad has raised questions of ballot fraud. Iran has agreed to a ballot probe. (Full story)
In other geopolitical news, on Saturday, North Korea said it would strengthen its nuclear capacities, despite the U.N. Security Council's move to increase sanctions against it.
Currencies and commodities: In currency trading, the dollar gained versus the euro and fell against the yen, following comments from Russia's finance minister that seemed to support a stronger dollar.
The movement in the dollar contributed to a retreat in oil and gold prices.
U.S. light crude oil for July delivery fell $1.42 to settle at $70.62 a barrel on the New York Mercantile Exchange.
COMEX gold for August delivery fell $13.20 to settle at $927.50 an ounce.
The national average price for a gallon of regular unleaded gas rose to $2.67 Monday, according to AAA. Prices have risen for 48 days straight, adding 62 cents, or over 30%.
Bonds: Treasury prices rallied as investors sought safety in government debt. The 10-year note yield added 18/32, lowering the yield to 3.72% from 3.79%. Treasury prices and yields move in opposite directions.
Washington: President Obama will release details Wednesday of a broad overhaul of how financial markets are regulated.
On Monday morning, Treasury Secretary Timothy Geithner called the nation's current regulatory system a "spectacle." Geithner spoke at an economic discussion sponsored by CNNMoney parent Time Warner.
He said that the recent stock market rally is a "broad validation" of the administration's efforts to get the economy back on track, but also said that the economy faced an "enormously challenging period ahead."
Health care reform is also front and center this week, including questions about whether workers' health care benefits should be taxed.
Economy: New York manufacturing conditions continued to retreat in June, according to the Empire State index. Conditions fell to negative 9.4 in June from negative 4.6 in May. Any reading below zero indicates weakness.
Other news: In global trading, Asian and European markets tumbled.
First Published: June 15, 2009: 9:47 AM ET
Find this article at:
http://money.cnn.com/2009/06/15/markets/markets_newyork/index.htm
Monday, June 15, 2009
Saturday, June 13, 2009
G8 prepares for economic crisis end
SATURDAY, JUNE 13, 2009
Geithner, right, said the world economy was still 'well below potential' [AFP]
The Group of Eight industrial nations have discussed how to prepare for an economic recovery and how to roll back rescue measures when the global financial crisis eventually is over.
Concluding a two-day meeting in the Italian city of Lecce, ministers said that although the global economy is still weak, so-called exit strategies from stimulus measures such as tax cuts and lower interest rates are "essential to promote a sustainable recovery over the long term".
The G8 - the US, Japan, Germany, France, Britain, Italy, Canada and Russia - said in a statement on Saturday that it had asked the International Monetary Fund to study ways to unwind hefty stimulus packages.
However, the group said that the outlook for the world economy remain uncertain.
"There are signs of stabilisation in our economies ... but the situation remains uncertain and significant risks remain to economic and financial stability."
Forecast revised
The IMF has raised its forecast for global growth in 2010 to 2.4 per cent.
Dominique Strauss-Kahn, the IMF chief, said the increase in the forecast was due to "improvement in the United States, in Asia and particularly in Japan".
However, he cautioned that the situation in emerging economies is "very concerning".
"We have to think about exit strategies but before the exit strategy we have to exit the crisis."
Dominique Strauss-Khan, IMF chief
"We have to stay very careful, recovery is weak ... we have to think about exit strategies but before the exit strategy we have to exit the crisis," Strauss-Kahn said.
He also said global unemployment would peak in 2011.
Timothy Geithner, the US treasury secretary, said: "I don't think we're at the point yet where we can say we have a recovery in place.
"It's too early to shift towards policy restraint."
He said the global economy was still "well below potential" and encouraging growth should still be "the main focus of policy" for world powers.
While US and Britain want the G8 to stay committed to stimulus packages, some European countries like Germany are urging the preparation of exit strategies to prevent inflation and to cut the massive debts which bailouts have brought.
Peer Steinbrueck, the German finance minister, said that rescue measures for economies hit by the crisis must "increasingly be combined with a credible exit
strategy."
"This means we must now think about how will go about it once we are getting out of this hole, this valley."
Geithner, right, said the world economy was still 'well below potential' [AFP]
The Group of Eight industrial nations have discussed how to prepare for an economic recovery and how to roll back rescue measures when the global financial crisis eventually is over.
Concluding a two-day meeting in the Italian city of Lecce, ministers said that although the global economy is still weak, so-called exit strategies from stimulus measures such as tax cuts and lower interest rates are "essential to promote a sustainable recovery over the long term".
The G8 - the US, Japan, Germany, France, Britain, Italy, Canada and Russia - said in a statement on Saturday that it had asked the International Monetary Fund to study ways to unwind hefty stimulus packages.
However, the group said that the outlook for the world economy remain uncertain.
"There are signs of stabilisation in our economies ... but the situation remains uncertain and significant risks remain to economic and financial stability."
Forecast revised
The IMF has raised its forecast for global growth in 2010 to 2.4 per cent.
Dominique Strauss-Kahn, the IMF chief, said the increase in the forecast was due to "improvement in the United States, in Asia and particularly in Japan".
However, he cautioned that the situation in emerging economies is "very concerning".
"We have to think about exit strategies but before the exit strategy we have to exit the crisis."
Dominique Strauss-Khan, IMF chief
"We have to stay very careful, recovery is weak ... we have to think about exit strategies but before the exit strategy we have to exit the crisis," Strauss-Kahn said.
He also said global unemployment would peak in 2011.
Timothy Geithner, the US treasury secretary, said: "I don't think we're at the point yet where we can say we have a recovery in place.
"It's too early to shift towards policy restraint."
He said the global economy was still "well below potential" and encouraging growth should still be "the main focus of policy" for world powers.
While US and Britain want the G8 to stay committed to stimulus packages, some European countries like Germany are urging the preparation of exit strategies to prevent inflation and to cut the massive debts which bailouts have brought.
Peer Steinbrueck, the German finance minister, said that rescue measures for economies hit by the crisis must "increasingly be combined with a credible exit
strategy."
"This means we must now think about how will go about it once we are getting out of this hole, this valley."
Big economies 'stabilising' - G8
The world's largest economies are beginning to stabilise but still face major risks amid an ongoing global recession, G8 finance ministers say.
At a meeting in Italy of G8 nations, the ministers said stock markets were rising, interest rates more stable, and consumer confidence was returning.
However, US Treasury chief Tim Geithner led warnings that it was too early to wind down economic stimulus packages.
He said they should remain in place until a global recovery was under way.
At the meeting in Lecce, which aimed to lay the groundwork for a full G8 heads of government conference next month in the earthquake-hit town of L'Aquila, the finance ministers conceded that the global situation "remains uncertain".
"Significant risks remain to economic and financial stability," the ministers said in a statement released at the end of their meeting.
It highlighted the possibility that unemployment could continue to rise even after output growth resumes.
Joint problems
But they agreed a joint statement which offered signs of hope after nine months of gloomy economic news.
"We have taken forceful and co-ordinated action to stabilise the financial sector and provide stimulus to restore economic growth and there are signs of stabilisation in our economies," the statement said.
Mr Geithner said the "early signs" were encouraging, but injected a note of caution.
"The global economy is still operating well below potential and we still face acute challenges," he said.
"I don't think we're at the point yet where we can say we have a recovery in place," Mr Geithner warned, saying it was "too early" to move away from the interventionist economic policies put in place around the world since the banking crisis of September 2008.
UK Chancellor Alastair Darling said Britain's economic prospects remained linked to those of other G8 nations.
"A lot will depend on other countries making progress: on cleaning up their bank balance sheets; volatility in commodity prices, oil for example. So I think there are reasons to be cautious," he told Reuters news agency.
The meeting comes two months after a full G8 heads of government meeting in London agreed to inject billions of dollars into the global economy.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/8098886.stm
Published: 2009/06/13 15:52:21 GMT
At a meeting in Italy of G8 nations, the ministers said stock markets were rising, interest rates more stable, and consumer confidence was returning.
However, US Treasury chief Tim Geithner led warnings that it was too early to wind down economic stimulus packages.
He said they should remain in place until a global recovery was under way.
At the meeting in Lecce, which aimed to lay the groundwork for a full G8 heads of government conference next month in the earthquake-hit town of L'Aquila, the finance ministers conceded that the global situation "remains uncertain".
"Significant risks remain to economic and financial stability," the ministers said in a statement released at the end of their meeting.
It highlighted the possibility that unemployment could continue to rise even after output growth resumes.
Joint problems
But they agreed a joint statement which offered signs of hope after nine months of gloomy economic news.
"We have taken forceful and co-ordinated action to stabilise the financial sector and provide stimulus to restore economic growth and there are signs of stabilisation in our economies," the statement said.
Mr Geithner said the "early signs" were encouraging, but injected a note of caution.
"The global economy is still operating well below potential and we still face acute challenges," he said.
"I don't think we're at the point yet where we can say we have a recovery in place," Mr Geithner warned, saying it was "too early" to move away from the interventionist economic policies put in place around the world since the banking crisis of September 2008.
UK Chancellor Alastair Darling said Britain's economic prospects remained linked to those of other G8 nations.
"A lot will depend on other countries making progress: on cleaning up their bank balance sheets; volatility in commodity prices, oil for example. So I think there are reasons to be cautious," he told Reuters news agency.
The meeting comes two months after a full G8 heads of government meeting in London agreed to inject billions of dollars into the global economy.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/8098886.stm
Published: 2009/06/13 15:52:21 GMT
China’s Economy Takes a Sharp Domestic Turn
June 12, 2009
By KEITH BRADSHER
HONG KONG — Since China entered the World Trade Organization in November 2001, a rising tide of exports, combined with a torrent of investment, has lifted the country’s economy ever higher, while consumer spending has lagged.
But now, the Chinese economy relies increasingly on growth at home, as data released Thursday made clear. A decline in exports has become a serious drag on growth, while government spending has led domestic investments higher at a remarkable pace and consumer spending appears to have been fairly strong as well.
Some economists wonder whether China is actually becoming too reliant on investment spending and whether the government’s economic stimulus program may be making this worse.
“For China’s nascent economic recovery to be sustainable beyond the short term, policy makers must take steps to ensure that consumption remains on a firm growth trajectory and that the investment boom does not exacerbate the economy’s structural imbalances,” the chairwoman of China equities at JPMorgan, Jing Ulrich, said in a research note.
Chinese exports plunged by a record 26.4 percent in May from a year earlier, the Chinese customs agency announced Thursday, as buyers in industrialized countries remained cautious about placing orders.
But investments in fixed assets like roads, factories and apartment buildings set a record in the opposite direction.
Chinese investment expenditures rose 32.9 percent in the first five months of this year, compared with the investments in the period last year, the National Bureau of Statistics announced in Beijing.
Yu Song, a Goldman Sachs economist, calculated that after adjusting for inflation, Chinese investment spending had grown in May at a breakneck pace, rising close to 50 percent from May of last year.
The government’s stimulus program is powering much of that increase, with spending on railroads soaring 110.9 percent in the first five months of 2009, compared with the same period last year.
The Chinese media reported that retail sales in May, scheduled to be announced Friday morning, are likely to show an increase of 15.2 percent. That would represent a modest acceleration from April, when the increase from a year earlier was 14.8 percent, and a robust gain when adjusted for the gradual decline in overall prices in China.
The Chinese government has struggled to keep economic data secret, and leaks to the media have frequently been right.
One of the biggest supports for retail sales in China has been the auto market, with car sales rising briskly as the government has offered various subsidies, especially in rural areas.
The big question for China is how long the economy can stay strong without the support of vigorous exports. Wages and profits have slipped in export-oriented coastal zones of China, limiting the spending power of consumers.
Chinese imports fell a little more slowly than exports last month, dropping 25.2 percent from the period a year earlier. The Chinese trade surplus last month was $13.39 billion, compared with $13.14 billion in April and $16.37 billion a year ago.
By KEITH BRADSHER
HONG KONG — Since China entered the World Trade Organization in November 2001, a rising tide of exports, combined with a torrent of investment, has lifted the country’s economy ever higher, while consumer spending has lagged.
But now, the Chinese economy relies increasingly on growth at home, as data released Thursday made clear. A decline in exports has become a serious drag on growth, while government spending has led domestic investments higher at a remarkable pace and consumer spending appears to have been fairly strong as well.
Some economists wonder whether China is actually becoming too reliant on investment spending and whether the government’s economic stimulus program may be making this worse.
“For China’s nascent economic recovery to be sustainable beyond the short term, policy makers must take steps to ensure that consumption remains on a firm growth trajectory and that the investment boom does not exacerbate the economy’s structural imbalances,” the chairwoman of China equities at JPMorgan, Jing Ulrich, said in a research note.
Chinese exports plunged by a record 26.4 percent in May from a year earlier, the Chinese customs agency announced Thursday, as buyers in industrialized countries remained cautious about placing orders.
But investments in fixed assets like roads, factories and apartment buildings set a record in the opposite direction.
Chinese investment expenditures rose 32.9 percent in the first five months of this year, compared with the investments in the period last year, the National Bureau of Statistics announced in Beijing.
Yu Song, a Goldman Sachs economist, calculated that after adjusting for inflation, Chinese investment spending had grown in May at a breakneck pace, rising close to 50 percent from May of last year.
The government’s stimulus program is powering much of that increase, with spending on railroads soaring 110.9 percent in the first five months of 2009, compared with the same period last year.
The Chinese media reported that retail sales in May, scheduled to be announced Friday morning, are likely to show an increase of 15.2 percent. That would represent a modest acceleration from April, when the increase from a year earlier was 14.8 percent, and a robust gain when adjusted for the gradual decline in overall prices in China.
The Chinese government has struggled to keep economic data secret, and leaks to the media have frequently been right.
One of the biggest supports for retail sales in China has been the auto market, with car sales rising briskly as the government has offered various subsidies, especially in rural areas.
The big question for China is how long the economy can stay strong without the support of vigorous exports. Wages and profits have slipped in export-oriented coastal zones of China, limiting the spending power of consumers.
Chinese imports fell a little more slowly than exports last month, dropping 25.2 percent from the period a year earlier. The Chinese trade surplus last month was $13.39 billion, compared with $13.14 billion in April and $16.37 billion a year ago.
The Big Hate
June 12, 2009
By PAUL KRUGMAN
Back in April, there was a huge fuss over an internal report by the Department of Homeland Security warning that current conditions resemble those in the early 1990s — a time marked by an upsurge of right-wing extremism that culminated in the Oklahoma City bombing.
Conservatives were outraged. The chairman of the Republican National Committee denounced the report as an attempt to “segment out conservatives in this country who have a different philosophy or view from this administration” and label them as terrorists.
But with the murder of Dr. George Tiller by an anti-abortion fanatic, closely followed by a shooting by a white supremacist at the United States Holocaust Memorial Museum, the analysis looks prescient.
There is, however, one important thing that the D.H.S. report didn’t say: Today, as in the early years of the Clinton administration but to an even greater extent, right-wing extremism is being systematically fed by the conservative media and political establishment.
Now, for the most part, the likes of Fox News and the R.N.C. haven’t directly incited violence, despite Bill O’Reilly’s declarations that “some” called Dr. Tiller “Tiller the Baby Killer,” that he had “blood on his hands,” and that he was a “guy operating a death mill.” But they have gone out of their way to provide a platform for conspiracy theories and apocalyptic rhetoric, just as they did the last time a Democrat held the White House.
And at this point, whatever dividing line there was between mainstream conservatism and the black-helicopter crowd seems to have been virtually erased.
Exhibit A for the mainstreaming of right-wing extremism is Fox News’s new star, Glenn Beck. Here we have a network where, like it or not, millions of Americans get their news — and it gives daily airtime to a commentator who, among other things, warned viewers that the Federal Emergency Management Agency might be building concentration camps as part of the Obama administration’s “totalitarian” agenda (although he eventually conceded that nothing of the kind was happening).
But let’s not neglect the print news media. In the Bush years, The Washington Times became an important media player because it was widely regarded as the Bush administration’s house organ. Earlier this week, the newspaper saw fit to run an opinion piece declaring that President Obama “not only identifies with Muslims, but actually may still be one himself,” and that in any case he has “aligned himself” with the radical Muslim Brotherhood.
And then there’s Rush Limbaugh. His rants today aren’t very different from his rants in 1993. But he occupies a different position in the scheme of things. Remember, during the Bush years Mr. Limbaugh became very much a political insider. Indeed, according to a recent Gallup survey, 10 percent of Republicans now consider him the “main person who speaks for the Republican Party today,” putting him in a three-way tie with Dick Cheney and Newt Gingrich. So when Mr. Limbaugh peddles conspiracy theories — suggesting, for example, that fears over swine flu were being hyped “to get people to respond to government orders” — that’s a case of the conservative media establishment joining hands with the lunatic fringe.
It’s not surprising, then, that politicians are doing the same thing. The R.N.C. says that “the Democratic Party is dedicated to restructuring American society along socialist ideals.” And when Jon Voight, the actor, told the audience at a Republican fund-raiser this week that the president is a “false prophet” and that “we and we alone are the right frame of mind to free this nation from this Obama oppression,” Mitch McConnell, the Senate minority leader, thanked him, saying that he “really enjoyed” the remarks.
Credit where credit is due. Some figures in the conservative media have refused to go along with the big hate — people like Fox’s Shepard Smith and Catherine Herridge, who debunked the attacks on that Homeland Security report two months ago. But this doesn’t change the broad picture, which is that supposedly respectable news organizations and political figures are giving aid and comfort to dangerous extremism.
What will the consequences be? Nobody knows, of course, although the analysts at Homeland Security fretted that things may turn out even worse than in the 1990s — that thanks, in part, to the election of an African-American president, “the threat posed by lone wolves and small terrorist cells is more pronounced than in past years.”
And that’s a threat to take seriously. Yes, the worst terrorist attack in our history was perpetrated by a foreign conspiracy. But the second worst, the Oklahoma City bombing, was perpetrated by an all-American lunatic. Politicians and media organizations wind up such people at their, and our, peril.
By PAUL KRUGMAN
Back in April, there was a huge fuss over an internal report by the Department of Homeland Security warning that current conditions resemble those in the early 1990s — a time marked by an upsurge of right-wing extremism that culminated in the Oklahoma City bombing.
Conservatives were outraged. The chairman of the Republican National Committee denounced the report as an attempt to “segment out conservatives in this country who have a different philosophy or view from this administration” and label them as terrorists.
But with the murder of Dr. George Tiller by an anti-abortion fanatic, closely followed by a shooting by a white supremacist at the United States Holocaust Memorial Museum, the analysis looks prescient.
There is, however, one important thing that the D.H.S. report didn’t say: Today, as in the early years of the Clinton administration but to an even greater extent, right-wing extremism is being systematically fed by the conservative media and political establishment.
Now, for the most part, the likes of Fox News and the R.N.C. haven’t directly incited violence, despite Bill O’Reilly’s declarations that “some” called Dr. Tiller “Tiller the Baby Killer,” that he had “blood on his hands,” and that he was a “guy operating a death mill.” But they have gone out of their way to provide a platform for conspiracy theories and apocalyptic rhetoric, just as they did the last time a Democrat held the White House.
And at this point, whatever dividing line there was between mainstream conservatism and the black-helicopter crowd seems to have been virtually erased.
Exhibit A for the mainstreaming of right-wing extremism is Fox News’s new star, Glenn Beck. Here we have a network where, like it or not, millions of Americans get their news — and it gives daily airtime to a commentator who, among other things, warned viewers that the Federal Emergency Management Agency might be building concentration camps as part of the Obama administration’s “totalitarian” agenda (although he eventually conceded that nothing of the kind was happening).
But let’s not neglect the print news media. In the Bush years, The Washington Times became an important media player because it was widely regarded as the Bush administration’s house organ. Earlier this week, the newspaper saw fit to run an opinion piece declaring that President Obama “not only identifies with Muslims, but actually may still be one himself,” and that in any case he has “aligned himself” with the radical Muslim Brotherhood.
And then there’s Rush Limbaugh. His rants today aren’t very different from his rants in 1993. But he occupies a different position in the scheme of things. Remember, during the Bush years Mr. Limbaugh became very much a political insider. Indeed, according to a recent Gallup survey, 10 percent of Republicans now consider him the “main person who speaks for the Republican Party today,” putting him in a three-way tie with Dick Cheney and Newt Gingrich. So when Mr. Limbaugh peddles conspiracy theories — suggesting, for example, that fears over swine flu were being hyped “to get people to respond to government orders” — that’s a case of the conservative media establishment joining hands with the lunatic fringe.
It’s not surprising, then, that politicians are doing the same thing. The R.N.C. says that “the Democratic Party is dedicated to restructuring American society along socialist ideals.” And when Jon Voight, the actor, told the audience at a Republican fund-raiser this week that the president is a “false prophet” and that “we and we alone are the right frame of mind to free this nation from this Obama oppression,” Mitch McConnell, the Senate minority leader, thanked him, saying that he “really enjoyed” the remarks.
Credit where credit is due. Some figures in the conservative media have refused to go along with the big hate — people like Fox’s Shepard Smith and Catherine Herridge, who debunked the attacks on that Homeland Security report two months ago. But this doesn’t change the broad picture, which is that supposedly respectable news organizations and political figures are giving aid and comfort to dangerous extremism.
What will the consequences be? Nobody knows, of course, although the analysts at Homeland Security fretted that things may turn out even worse than in the 1990s — that thanks, in part, to the election of an African-American president, “the threat posed by lone wolves and small terrorist cells is more pronounced than in past years.”
And that’s a threat to take seriously. Yes, the worst terrorist attack in our history was perpetrated by a foreign conspiracy. But the second worst, the Oklahoma City bombing, was perpetrated by an all-American lunatic. Politicians and media organizations wind up such people at their, and our, peril.
Rush and Newt Are Winning
By E.J. Dionne Jr.
Thursday, June 4, 2009
A media environment that tilts to the right is obscuring what President Obama stands for and closing off political options that should be part of the public discussion.
Yes, you read that correctly: If you doubt that there is a conservative inclination in the media, consider which arguments you hear regularly and which you don't. When Rush Limbaugh sneezes or Newt Gingrich tweets, their views ricochet from the Internet to cable television and into the traditional media. It is remarkable how successful they are in setting what passes for the news agenda.
The power of the Limbaugh-Gingrich axis means that Obama is regularly cast as somewhere on the far left end of a truncated political spectrum. He's the guy who nominates a "racist" to the Supreme Court (though Gingrich retreated from the word yesterday), wants to weaken America's defenses against terrorism and is proposing a massive government takeover of the private economy. Steve Forbes, writing for his magazine, recently went so far as to compare Obama's economic policies to those of Juan Peron's Argentina.
Democrats are complicit in building up Gingrich and Limbaugh as the main spokesmen for the Republican Party, since Obama polls so much better than either of them. But the media play an independent role by regularly treating far-right views as mainstream positions and by largely ignoring critiques of Obama that come from elected officials on the left.
This was brought home at this week's annual conference of the Campaign for America's Future, a progressive group that supports Obama but worries about how close his economic advisers are to Wall Street, how long our troops will have to stay in Afghanistan and how much he will be willing to compromise to secure health-care reform.
In other words, they see Obama not as the parody created by the far right but as he actually is: a politician with progressive values but moderate instincts who has hewed to the middle of the road in dealing with the economic crisis, health care, Guantanamo and the war in Afghanistan.
While the right wing's rants get wall-to-wall airtime, you almost never hear from the sort of progressive members of Congress who were on an America's Future panel on Tuesday. Reps. Jared Polis of Colorado, Donna Edwards of Maryland and Raul Grijalva of Arizona all said warm things about the president -- they are Democrats, after all -- but also took issue with some of his policies.
All three, for example, are passionately opposed to his military approach to Afghanistan and want a serious debate over the implications of Obama's strategy. "If we don't ask these questions now," said Edwards, "we'll ask these questions 10 years from now -- I guarantee it."
Polis spoke of how Lyndon Johnson's extraordinary progressive legacy "will always be overshadowed by Vietnam" and said that progressives who were challenging the administration's foreign policy were simply trying to "protect and enhance President Obama's legacy by preventing Afghanistan and Iraq from becoming another Vietnam."
As it happens, I am closer than the progressive trio is to Obama's view on Afghanistan. But why are their voices muffled when they raise legitimate concerns, while Limbaugh's rants get amplified? Isn't Afghanistan a more important issue to debate than a single comment by Judge Sonia Sotomayor about the relative wisdom of Latinas?
Polis, Edwards and Grijalva also noted that proposals for a Canadian-style single-payer health-care system, which they support, have fallen off the political radar. Polis urged his activist audience to accept that reality for now and focus its energy on making sure that a government insurance option, known in policy circles as the "public plan," is part of the menu of choices offered by a reformed health-care system.
But Edwards noted that if the public plan, already a compromise from single-payer, is defined as the left's position in the health-care debate, the entire discussion gets skewed to the right. This makes it far more likely that any public option included in a final bill will be a pale version of the original idea.
Her point has broader application. For all the talk of a media love affair with Obama, there is a deep and largely unconscious conservative bias in the media's discussion of policy. The range of acceptable opinion runs from the moderate left to the far right and cuts off more vigorous progressive perspectives.
Democrats love to think that Limbaugh and Gingrich are weakening the conservative side. But guess what? By dragging the media to the right, Rush and Newt are winning.
Thursday, June 4, 2009
A media environment that tilts to the right is obscuring what President Obama stands for and closing off political options that should be part of the public discussion.
Yes, you read that correctly: If you doubt that there is a conservative inclination in the media, consider which arguments you hear regularly and which you don't. When Rush Limbaugh sneezes or Newt Gingrich tweets, their views ricochet from the Internet to cable television and into the traditional media. It is remarkable how successful they are in setting what passes for the news agenda.
The power of the Limbaugh-Gingrich axis means that Obama is regularly cast as somewhere on the far left end of a truncated political spectrum. He's the guy who nominates a "racist" to the Supreme Court (though Gingrich retreated from the word yesterday), wants to weaken America's defenses against terrorism and is proposing a massive government takeover of the private economy. Steve Forbes, writing for his magazine, recently went so far as to compare Obama's economic policies to those of Juan Peron's Argentina.
Democrats are complicit in building up Gingrich and Limbaugh as the main spokesmen for the Republican Party, since Obama polls so much better than either of them. But the media play an independent role by regularly treating far-right views as mainstream positions and by largely ignoring critiques of Obama that come from elected officials on the left.
This was brought home at this week's annual conference of the Campaign for America's Future, a progressive group that supports Obama but worries about how close his economic advisers are to Wall Street, how long our troops will have to stay in Afghanistan and how much he will be willing to compromise to secure health-care reform.
In other words, they see Obama not as the parody created by the far right but as he actually is: a politician with progressive values but moderate instincts who has hewed to the middle of the road in dealing with the economic crisis, health care, Guantanamo and the war in Afghanistan.
While the right wing's rants get wall-to-wall airtime, you almost never hear from the sort of progressive members of Congress who were on an America's Future panel on Tuesday. Reps. Jared Polis of Colorado, Donna Edwards of Maryland and Raul Grijalva of Arizona all said warm things about the president -- they are Democrats, after all -- but also took issue with some of his policies.
All three, for example, are passionately opposed to his military approach to Afghanistan and want a serious debate over the implications of Obama's strategy. "If we don't ask these questions now," said Edwards, "we'll ask these questions 10 years from now -- I guarantee it."
Polis spoke of how Lyndon Johnson's extraordinary progressive legacy "will always be overshadowed by Vietnam" and said that progressives who were challenging the administration's foreign policy were simply trying to "protect and enhance President Obama's legacy by preventing Afghanistan and Iraq from becoming another Vietnam."
As it happens, I am closer than the progressive trio is to Obama's view on Afghanistan. But why are their voices muffled when they raise legitimate concerns, while Limbaugh's rants get amplified? Isn't Afghanistan a more important issue to debate than a single comment by Judge Sonia Sotomayor about the relative wisdom of Latinas?
Polis, Edwards and Grijalva also noted that proposals for a Canadian-style single-payer health-care system, which they support, have fallen off the political radar. Polis urged his activist audience to accept that reality for now and focus its energy on making sure that a government insurance option, known in policy circles as the "public plan," is part of the menu of choices offered by a reformed health-care system.
But Edwards noted that if the public plan, already a compromise from single-payer, is defined as the left's position in the health-care debate, the entire discussion gets skewed to the right. This makes it far more likely that any public option included in a final bill will be a pale version of the original idea.
Her point has broader application. For all the talk of a media love affair with Obama, there is a deep and largely unconscious conservative bias in the media's discussion of policy. The range of acceptable opinion runs from the moderate left to the far right and cuts off more vigorous progressive perspectives.
Democrats love to think that Limbaugh and Gingrich are weakening the conservative side. But guess what? By dragging the media to the right, Rush and Newt are winning.
World Bank sees even worse slump
The world economy will shrink by much more than previously thought, according to the World Bank.
The world economy will contract by 3% this year, far more than the 1.75% drop it predicted earlier this year.
"Most developing country economies will contract this year and face increasingly bleak prospects," World Bank president Robert Zoellick said.
The gloomier forecast comes despite recent signs that the worst of the recession is over.
This year is likely to be the first global recession since World War II.
'Aftershocks'
The revised figure brings it closer in line with the OECD, which represents rich nations, who predicted that the world economy will shrink by 2.7%.
The World Bank's sister institution, International Monetary Fund (IMF), said in April the world economy will shrink by 1.3% this year.
However, the forecasts are broadly compatible as the World Bank methodology gives a smaller weight to China, still the world's fastest growing large economy.
Mr Zoellick still predicted a recovery next year.
"Although growth is expected to revive during the course of 2010, the pace of the recovery is uncertain and the poor in many developing countries will continue to be buffeted by the aftershocks," he said.
The World Bank said the International Development Association (IDA), a division of the World Bank that focuses on the 78 poorest countries, had received a record number of pleas for help.
For the year to 30 June, the number of grants and interest-free loans are expected to be $13bn, the most ever. In the previous year, the figure was $11.2bn.
The World Bank forecast comes before a meeting of the finance ministers from the Group of Eight richest nations on Friday in Lecce, Italy.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/8095702.stm
Published: 2009/06/11 14:35:00 GMT
The world economy will contract by 3% this year, far more than the 1.75% drop it predicted earlier this year.
"Most developing country economies will contract this year and face increasingly bleak prospects," World Bank president Robert Zoellick said.
The gloomier forecast comes despite recent signs that the worst of the recession is over.
This year is likely to be the first global recession since World War II.
'Aftershocks'
The revised figure brings it closer in line with the OECD, which represents rich nations, who predicted that the world economy will shrink by 2.7%.
The World Bank's sister institution, International Monetary Fund (IMF), said in April the world economy will shrink by 1.3% this year.
However, the forecasts are broadly compatible as the World Bank methodology gives a smaller weight to China, still the world's fastest growing large economy.
Mr Zoellick still predicted a recovery next year.
"Although growth is expected to revive during the course of 2010, the pace of the recovery is uncertain and the poor in many developing countries will continue to be buffeted by the aftershocks," he said.
The World Bank said the International Development Association (IDA), a division of the World Bank that focuses on the 78 poorest countries, had received a record number of pleas for help.
For the year to 30 June, the number of grants and interest-free loans are expected to be $13bn, the most ever. In the previous year, the figure was $11.2bn.
The World Bank forecast comes before a meeting of the finance ministers from the Group of Eight richest nations on Friday in Lecce, Italy.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/business/8095702.stm
Published: 2009/06/11 14:35:00 GMT