Dollar Falls on US Growth Slowdown

The US dollar fell sharply against some of the major currencies today, following a report that showed that the economic growth in the second quarter of 2011 was worse than expected.

The greenback was trading at a rather high level against the other currencies earlier today, advancing significantly both against the euro and the Great Britain pound before 12:30 GMT today. Following the US GDP report, it slid to bearish against the euro and trades almost in the negative zone against the pound. The dollar is also down against the Japanese yen and the Swiss franc.

The gross domestic product increased at an annual rate of 1.3 percent in the Q2 2011 from the Q1 2011. The first quarter growth was revised down from 1.9 percent to 0.4 percent. The traders expected 1.8 percent gain in GDP on average. This news is very pessimistic in regards of the possible rate increases in the United States and thus is extremely negative for the US dollar.

EUR/USD went up from 1.4327 to 1.4333 as of 13:09 GMT, trading as low as 1.4229 earlier. GBP/USD is now trading near its opening level — 1.6369. USD/JPY fell from 77.69 to 77.14 today.

If you have any questions, comments or opinions regarding the US Dollar, feel free to post them using the commentary form below.

Earlier News About the US Dollar:
» Continued Debates over US Debt Push USD to New Lows vs. CHF (2011-07-25)
» Optimism for Europe Returns, Greenback Suffers (2011-07-20)
» Dollar Rises on Signs of Agreement Among US Lawmakers (2011-07-19)
» S&P Warn About Possible Downgrade of US Rating, USD Down (2011-07-15)
» Dollar Regains Strength as Bernanke Speaks (2011-07-14)


This entry was posted on TopForexNews on Friday, July 29th, 2011 at 1:13 pm and is filed under US Dollar. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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What’s so wrong with Reid’s bill?

posted at 2:45 pm on July 29, 2011 by Tina Korbe
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House Speaker John Boehner’s debt-ceiling-and-deficit-reduction bill, now through Revision Round 2 and headed for likely passage, has hogged most media attention over the past few days, but, with Senate Majority Leader Harry Reid now touting his bill as “the only compromise there is,” the lesser-known parts of Reid’s proposal deserve a little bit of attention.

First and most importantly, the bill actually explicitly seeks to excuse the Senate from passing a budget resolution for the next two years. Reid and Senate Democrats have enjoyed a more-than-800-day vacation from crafting a budget in the first place, but that’s just not enough – never mind that the law requires the Senate to pass a budget every year. So, how does the Reid plan enable the Senate to skirt its responsibility even further? It “deems” a budget for this year and next year.

Sen. Jeff Sessions (R-Ala.) explained today on the Senate floor just what this means:

The Reid amendment to increase the debt limit deems two consecutive budget resolutions for fiscal years 2012 and 2013. In other words, it basically takes over the budget process and sets the basic spending number. Does the president think the Senate should go two more years without crafting or passing a budget? We’ve already gone two. The Reid amendment sets spending allocations for most Senate committees at the Congressional Budget Office’s rising baseline. … So it just says we’re going to deem the amount we spend, what C.B.O. has projected our growth and spending to be. And C.B.O. projects growth in spending. They don’t set that as right for America, but they project that’s what will occur under current circumstances. … So without hearings or debate on these allocations, this provision would provide a further excuse for avoiding a budget and increase the likelihood … the Congressional Budget Act will be violated for the third straight year. This is an abrogation of the responsibilities of the Senate and of the Budget Committee of the United States Senate. We were not elected to the Senate and chosen to serve on the Committee on the Budget … to see most of the budget levels automatically raised based on a set of spending growth projections by some apparachix in the C.B.O.

Sessions is right. It is an abrogation of responsibility — and one that’s been little remarked upon in discussion of Reid’s amendment.

Next, Reid’s bill boasts the largest debt increase in U.S. history — $2.7 trillion. Up to now, the most sizable increase has been $1.9 trillion (also an Obama increase). Debt ceiling increases might be routine — but hikes of this magnitude are not. Far better — and, frankly, more in line with precedent — to split that increase into two “smaller” amounts (even split in half, the increase is monstrous!).

Finally, as has been repeatedly pointed out, the savings in Reid’s bill aren’t exactly real. Reid touts dollar-for-dollar savings, but that’s a ruse. The bill actually delivers just $1 trillion in cuts in exchange for that unprecedented $2.7 trillion increase. The Global War on Terror savings are a gimmick. The administration has never requested current levels of funding for the war for the next ten years (i.e. the administration has never planned to spend $160 billion each year on the war for the next 10 years). Not funding what the administration was never going to fund doesn’t qualify as a cut.

Yet, Reid still claims his bill represents a compromise, whereas Boehner’s bill does not. Here he is today, making it sound as though he’s doing a favor to moderate Republicans who recoil from the lack of compromise Boehner has put forth:

Right now, this is the only compromise there is. … What is being done in the House is not a compromise. It’s being jammed through there with all kinds of non-transparent dealings. We’re recognizing the only compromise there is, is mine. Ours is truly a bipartisan piece of legislation. Republicans realize that. I’ve had a number of Republicans come to me. I had one Republican come to me and say, “Thank you” for your legislation. … I’ve asked my friend Sen. McConnell to meet with me and try to work this out. … The stakes couldn’t be higher. The security of our nation, every family, is at stake here. If the debt ceiling is not increased, every American family will feel an increase in their taxes, all their payments, credit cards, loans that they’ve taken out for their children to go to college, car payments, mortgages on their houses. So I say here to my Republican colleagues in the Senate to put the American people first. … The people we all represent want us to come together.

But what does the bill offer that Republicans want? Equivalent cuts? No. Enforceable future cuts? No. A vote on a balanced budget amendment? Certainly not.

Why aren’t House Republicans writing Reid a letter to say they won’t support his bill if it makes it to the House? Why isn’t Boehner saying it’s DOA?

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Reid changing debt-ceiling plan to woo Republicans

posted at 10:00 am on July 30, 2011 by Ed Morrissey
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After yesterday’s embarrassing plea to Mitch McConnell to save him from a cloture vote, Harry Reid went back to the drawing board. The Hill reports that Reid has altered his plan to raise the debt ceiling by borrowing more from the plans of McConnell and John Boehner, hoping to shake loose enough Republicans to get past the procedural hurdle:

The biggest change is that Reid would give the president almost unilateral power to raise the debt limit, borrowing an idea introduced by Senate Republican Leader Mitch McConnell (R-Ky.).

Reid would have President Obama request a $2.4 trillion debt-limit increase in two installments of $1.2 trillion each. The requests would be subject to congressional resolutions of disapproval, but these would do little to restrict the president.

Obama could veto any resolution of disapproval, and it would take a two-thirds vote in both chambers of Congress to override him.

According to a Senate Democratic aide, Reid also increased the total level of spending cuts from $2.2 trillion to $2.4 trillion, in part by using the January baseline — a budget maneuver House Speaker John Boehner (R-Ohio) used on a previous version of his debt-limit plan. The January budget baseline does not count cuts Congress implemented in legislation passed this spring to avert a government shutdown.

The McConnell mechanism wouldn’t stop Obama from raising the debt ceiling limit in the next installment, but Republicans might be more inclined to see that as a bug rather than a feature by now. The “cuts” – such as they are – would come up front, with the possibility for getting more cuts down the line. Obama would have to raise the limit himself, and Republicans in both chambers would be able to vote against it, forcing Democrats to own the hikes. It’s not pretty, but it would set up the debate in 2012 as well as can be expected for the GOP at this point.

Reid also is rumored to be offering a vote on a balanced budget amendment as a sweetener for Republicans in the Senate, although not requiring passage. That’s also a good development for the GOP. A properly written amendment would force Congress to control spending rather than raise taxes by limiting the federal budget to a constant percentage of GDP. If Democrats vote such a plan down, it’s yet another point for the 2012 debate.

However, according to The Daily Caller’s Amanda Carey and the Republicans on the Senate Budget Committee, the Reid plan has a big and unpleasant surprise for Republicans on taxes. Reid’s figures rely on current law — and current law has all of the Bush-era tax rates expiring and rising to their previous levels. It also assumes that Congress won’t provide a “patch” for the AMT:

Reid’s proposal includes a provision that “deems” budget resolutions for fiscal years 2012 and 2013, but Senate Democrats have not yet produced a 2012 budget proposal, much less one for 2013.

Within those anticipated budget resolutions lie the tax increases, according to the analysis, and here is where it gets tricky.

When the Congressional Budget Office scores a proposal, it uses either current policy or current law as its baseline. Reid’s bill is based on current law, which assumes certain tax breaks will expire according to pre-determined scheduled. That is a big deal.

The 2001–2003 Bush tax cuts are set to expire at the end of 2012. And some business tax breaks, “death tax” cuts, and the patch for the Alternative Minimum Tax expire at the end of 2011. Reid’s proposal assumes that Congress will not act to renew or extend those expiring tax breaks.

Total tax hike over 10 years, according to the GOP analysis? $3.8 trillion. And those would not just be tax hikes on the “wealthy,” either. Those tax hikes would hit the middle class like a freight train, both on basic rates and the AMT creep that Congress has parried for years. If this analysis is correct, Reid either wants to hit the US with the biggest tax hike in its history, or he’s offering bogus deficit reduction that will never occur.

If this sounds like a bad deal to you, keeping in mind what Tina wrote yesterday as well, then it just shows that you’re paying attention. It could get worse, though, as this Star Wars parody shows:

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Tech-savvy president wages Twitter campaign against GOP, loses 36,000+ followers

posted at 7:30 pm on July 29, 2011 by Allahpundit
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Unexpectedly.

President Obama created a barrage of activity on Twitter on Friday afternoon when he began urging his more than 9 million followers to tweet at their Republican Congressmen to “ask them to support a bipartisan solution to the deficit crisis.”

The @BarackObama account then preceded to tweet out the Twitter handles of Republican Congressmen state-by-state. The account has also been making use of the hashtag #compromise in an effort to drive home the message of bipartisanship…

As we noted in our earlier coverage, however, some users felt the state-by-state tweets were creating way too much noise — the President has lost nearly 37,000 followers so far today.

To put it another way, he lost twice as many followers today as jobs created last month. Go have a look at his Twitter feed. His staff was beaming out the Twitter handles of congressional Republicans every few minutes for six hours. They could have achieved the same thing by tweeting this once every half-hour, say, until the House vote finally began. And the dumbest part? The congressmen they were targeting were trying to compromise by passing Boehner’s bill and advancing the ball so that a deal can be struck before Tuesday. If anyone needed lobbying to “compromise,” it was the 22 Republican tea-party holdouts.

But that’s not the punchline. This is:

But could this strategy have an unintended consequence for the president? With 9.4 million followers, Obama’s campaign account is one of the most followed. Mentioning GOP foes to Obama’s followers could help boost their followings on Twitter.

By midafternoon on Friday, that seemed to be the case.

A Senate Republican staffer told National Journal that Republican Senators, in total, added about 6,500 new followers throughout the afternoon.

Said one polisci professor, “It’s the cyber-equivalent of pre-printed postcards — totally ineffectual.” Exit quotation from one Twitter user who got tired of being spammed: “I just unfollowed @barackobama seemed like a good #compromise.”

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Dollar Falls on US Growth Slowdown

US DollarThe US dollar fell sharply against some of the major currencies today, following a report that showed that the economic growth in the second quarter of 2011 was worse than expected.

The greenback was trading at a rather high level against the other currencies earlier today, advancing significantly both against the euro and the Great Britain pound before 12:30 GMT today. Following the US GDP report, it slid to bearish against the euro and trades almost in the negative zone against the pound. The dollar is also down against the Japanese yen and the Swiss franc.

The gross domestic product increased at an annual rate of 1.3 percent in the Q2 2011 from the Q1 2011. The first quarter growth was revised down from 1.9 percent to 0.4 percent. The traders expected 1.8 percent gain in GDP on average. This news is very pessimistic in regards of the possible rate increases in the United States and thus is extremely negative for the US dollar.

EUR/USD went up from 1.4327 to 1.4333 as of 13:09 GMT, trading as low as 1.4229 earlier. GBP/USD is now trading near its opening level — 1.6369. USD/JPY fell from 77.69 to 77.14 today.

If you have any questions, comments or opinions regarding the US Dollar, feel free to post them using the commentary form below.

Earlier News About the US Dollar:

    Continued Debates over US Debt Push USD to New Lows vs. CHF (2011-07-25)
    Optimism for Europe Returns, Greenback Suffers (2011-07-20)
    Dollar Rises on Signs of Agreement Among US Lawmakers (2011-07-19)
    S&P Warn About Possible Downgrade of US Rating, USD Down (2011-07-15)
    Dollar Regains Strength as Bernanke Speaks (2011-07-14)

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Euro Slids for Second Day on Debt Crisis Concern

EuroThe euro fell against all of its major counterparts today, as the fear of the debt crisis spreading beyond Greece and other troubled countries of the Eurozone.

The euro is currently demonstrating a second bearish day in a row against the US dollar, the Great Britain pound and the Japanese yen. It is falling against the dollar despite the stalemate in the US debt-limit discussions, which may lead to a technical default on August 2.

Greece’s long-term sovereign credit rating was reduced to CC by Standard & Poor’s yesterday. It was also reported by the agency that the proposed measures (by the European Union) will push the rating to SD (selective default), as it will result in losses for the commercial creditors. Meanwhile, Moody’s downgraded Cyrpus from A2 to Baa1 with a negative outlook on its government bonds.

EUR/USD fell from 1.4368 to 1.4304 as of 17:12 GMT; it traded as low as 1.4254 earlier today. Yesterday, the pair opened at 1.4512. EUR/GBP declined from 0.8797 to 0.8756 and EUR/JPY decreased from 111.93 to 111.36.

If you have any questions, comments or opinions regarding the Euro, feel free to post them using the commentary form below.

Earlier News About the Euro:

    Euro Posts Weekly Gain After Two Weeks of Losses (2011-07-23)
    Euro Drops as Optimism Caused by EU Summit Wanes (2011-07-22)
    Euro Jumps as EU Leaders Make Plan to Help Greece (2011-07-21)
    Is Agreement Among European Leaders Attainable? Perhaps (2011-07-19)
    Bad Monday for Euro (2011-07-18)

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Reid: Hey, who’s up for killing another debt-ceiling increase?

posted at 2:30 pm on July 28, 2011 by Ed Morrissey
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Must be nice to have a job that doesn’t actually require any work, except to refuse to work at all:

House Republicans are just wasting their time debating Speaker John Boehner’s debt reduction bill, Senate Majority Leader Harry Reid said today.

“Boehner’s bill dies tonight,” Reid communications director Adam Jentleson wrote on Twitter. “Forever.” …

“As soon as the House completes its vote, the Senate will move to take up that bill,” Reid said, “and it will be defeated tonight.”

“No Democrat will vote for a short-term Band-Aid that would put our economy at risk and put the nation back in this untenable situation a few short months from now,” he said.

To which the answer should be: “Where’s the Senate plan?” The Politico article has Harry Reid standing in front of a display that reads, “In the battle of budget scores, Senate plan is a clear winner over Boehner plan.” That was certainly true of the Boehner 1.0 plan, but it’s less clear that it’s true about Boehner 1.1. Either way, Reid’s bill only reduced actual spending by $750 billion rather than Boehner 1.0′s $710 billion over a ten-year period, so neither was exceptionally robust in scoring. It’s a bit like bragging about winning a football game when the only score comes off of a safety.

But that argument assumes the Senate will actually produce a plan. So far, even though Reid controls the majority and the floor, we haven’t even seen a hint of a vote. In fact, we haven’t seen the Senate originate any budget bill in over 800 days. Since Reid’s plan doesn’t include new taxes — or at least that’s his claim — it doesn’t have to originate in the House.

The proper legislative process should be for both chambers to work on their own versions of legislation and form a conference committee to produce a bill for up-or-down votes in each chamber. Reid could have done that with the CCB bill, had he chosen to do so, although there would have been very few commonalities between a Senate response and the CCB around which to compromise. That’s not true of the Boehner 1.1 bill; as National Journal noted yesterday, they have quite a bit in common, including the level of cuts. All that needs to happen is to get the Senate to pass its bill and let the conference committee hammer it out. That can even take place after a vote to kill Boehner 1.1.

If all Reid does is vote to kill the Boehner plan, however, then nothing can happen. Reid wants to bully the House into doing his work. The House should tell Reid to do his job rather than worry about doing theirs. If Democrats never plan to make a proposal, then they should just pass Boehner 1.1, and Republicans should call a halt to any further efforts until Democrats start taking their responsibilities seriously.

Update: A reminder, via Newsbusters‘ Lachlan Markay, that Harry Reid could have raised the debt ceiling last year.

Update II: Lachlan actually went to Heritage a few weeks ago.

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Oh, by the way, the U.S. just accused Iran of working with Al Qaeda

posted at 8:19 pm on July 28, 2011 by Allahpundit
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A little something light to tide you over while we wait for the next chapter in the debt-ceiling saga. I’ve been around blogs long enough to remember when claiming that Shiite nuts might collaborate with Sunni nuts against America would draw derisive snickers from lefty blogs at the sheer wingnuttery of the idea. Isn’t it just like neocons to try to drum up war against Iran by claiming a connection as preposterous as that?

And now here we are. Over to you, Obama administration:

The Treasury Department slapped sanctions on six individuals operating in a network that they said “serves as the core pipeline through which al Qaeda moves money, facilitators and operatives from across the Middle East to South Asia, including to Atiyah Abd al-Rahman, a key al Qaeda leader based in Pakistan, also designated today.”

“Iran is the leading state sponsor of terrorism in the world today. By exposing Iran’s secret deal with al Qaeda allowing it to funnel funds and operatives through its territory, we are illuminating yet another aspect of Iran’s unmatched support for terrorism,” Under Secretary for Terrorism and Financial Intelligence David Cohen said in a statement announcing the sanctions…

Among the individuals sanctioned today is Ezedin Abdel Aziz Khalil, described by the Treasury Department as “an Iran-based senior al Qaeda facilitator currently living and operating in Iran under an agreement between al Qaeda and the Iranian government.”…

“As al Qaeda’s representative in Iran, Khalil works with the Iranian government to arrange releases of al Qaeda personnel from Iranian prisons. When al Qaeda operatives are released, the Iranian government transfers them to Khalil, who then facilitates their travel to Pakistan,” the Treasury Department said.

This isn’t the first time Treasury’s targeted Al Qaeda inside Iran, actually: Bill Roggio remembers that four AQ operatives, including Saad Bin Laden, were sanctioned in January 2009. If that doesn’t prove to you that Iran’s dealing with major players inside Al Qaeda, not just the rank-and-file, Roggio also points out that Atiyah Abd al-Rahman happens to be Al Qaeda’s operations chief and was working with Bin Laden himself on an attack timed to the 10th anniversary of 9/11 before the SEALs came knocking on Osama’s door. But then, none of this is the least bit surprising. Remember where Saif al-Adel, one of AQ’s highest capos, spent the better part of the last decade? Remember the AP’s exclusive just two months ago about how Iran might be preparing to release Al Qaeda prisoners in order to target American troops in Iraq and Afghanistan? Do I need to link this evergreen Tom Joscelyn piece about longstanding ties between Iran and Al Qaeda yet again? Go figure that a fundamentalist state that specializes in outsourcing terror against the west via proxies might broker a cold peace with America-hating Wahhabist terrorists.

Since we’re on the subject, I feel obliged to link this hopeful WaPo story from a few days ago about how U.S. intel increasingly believes Al Qaeda’s leadership in Pakistan is on its last legs. Daveed Gartenstein-Ross warns against declaring mission accomplished, which is fair enough, but if the best this degenerate can do right now is try to convince Syrian protesters that America’s their worst enemy and not the monster in Damascus who’s been killing them for months, well, maybe we’re closer to mission accomplished than we think.

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Chaos: Gunmen kill Libyan rebels’ top military commander — while he’s in rebel custody

posted at 7:38 pm on July 28, 2011 by Allahpundit
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To fully appreciate how shady this is, take two minutes to read the Atlantic Wire’s excellent tick-tock of news accounts of how this guy was killed. Rumors that he was dead started turning up in Arab media four days ago, oddly enough. Then word came that he had been recalled from the front lines to Benghazi to be questioned about collaborating with Qaddafi loyalists. (Younis used to be the regime’s Interior Minister but defected to the rebels earlier this year and took charge of their army.) Then, suddenly, he was under arrest. And lo and behold, shortly thereafter he was dead — shot by a mysterious group of gunmen whose identities the rebels’ spokesman is being curiously tight-lipped about. The AP’s story simply reeks of suspicion that it was an inside job:

The head of the Libyan rebel armed forces was shot and killed Thursday just before arriving for questioning by rebel authorities, their political leader said in a carefully worded statement to reporters that gave few details on who was behind the killing.

Adding to the confusion, the rebels had said hours earlier they had already detained the commander, Abdel-Fattah Younis, on suspicion his family might still have ties to the regime of Moammar Gadhafi, raising questions about whether he might have been assassinated by his own side…

Announcing the killing at a press conference where he did not take questions, Mustafa Abdul-Jalil, head of the rebels’ National Transitional Council, called Younis “one of the heroes of the 17th of February revolution,” a name marking the date of early protests against Gadhafi’s regime.

He said two of the commander’s aides, both colonels, were also killed in the attack by gunmen and that rebels had arrested the head of the group behind the attack. He did not say what he thought motivated the killers.

The spokesman himself alternately blamed the killing on “efforts by the Gadhafi regime to break our unity” and, er, “armed criminal gangs” running wild. Supposedly the “gang” killed him before he arrived before the rebel council in Benghazi to be questioned about ties to Qaddafi, but a rumor being pushed to Al Jazeera by Qaddafi loyalists claims that Younis was executed by the gunmen before the committee itself. Yet another journalist flagged by the Atlantic is hearing that the killing happened after a “major general” from a rival rebel tribe started an argument with Younis at a Benghazi hotel. (Remember, Younis wasn’t supposed to be in Benghazi today; he was recalled from the front.) Any guesses who that general might be? Revisit this post by Ed from April for a possibility.

To sum up, then: The man who’s supposed to be leading rebel troops to final victory over Qaddafi, thereby vindicating NATO’s decision to join the war, is now dead in his own capital on the orders of his own side, in all probability. The best-case scenario is that he was a traitor to their/our side and had to be removed immediately. The worst-case scenario is that the rebel leadership is so dysfunctional and gangsterish that they’re risking their war effort on settling personal grievances. This comes, incidentally, after a week filled with stories about the failure of “diplomatic solutions” to the stalemate, the best of which is this Time piece marveling at the fact that NATO’s been so ineffective in dislodging Qaddafi that we’re now looking at peace treaties that would involve letting him stay in the country. Take a moment to read it. And remember: “Days, not weeks.”

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Rick Perry: Abortion is a states’ rights issue

posted at 5:07 pm on July 28, 2011 by Allahpundit
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A smart middle-ground play for independents, but I thought he was supposed to be the great evangelical hope. Last week he said he was “fine” with New York legalizing gay marriage before clarifying today that he’s not fine with gay marriage itself. (In fact, he supports a Federal Marriage Amendment.) Now this. Why would a social-conservative voter looking for a champion who has traction in the polls prefer him to, say, Bachmann?

Maybe Perry’s willing to shed some votes in Iowa in exchange for picking some up in New Hampshire.

Despite holding personal pro-life beliefs, Texas Gov. Rick Perry categorized abortion as a states’ rights issue today, saying that if Roe v. Wade was overturned, it should be up to the states to decide the legality of the procedure.

“You either have to believe in the 10th Amendment or you don’t,” Perry told reporters after a bill signing in Houston. “You can’t believe in the 10th Amendment for a few issues and then [for] something that doesn’t suit you say, ‘We’d rather not have states decide that.’”…

The National Right to Life Committee responded to Perry’s categorization of abortion as a states’ rights issue in a statement, saying, “Our society has an obligation to enact laws that recognize and protect the smallest members of our human family. Prior to Roe, states had the ability to enact laws that extended full legal protection to unborn children. We look forward to the day when Roe v. Wade is changed, and the states will once again have the ability to pass legislation that fully protects mothers and their unborn children.”

I’m surprised the NRLC gave him cover on that. Granted, the immediate first step after Roe is overturned would be state laws restricting abortion, but I’ve never understood that to be the end point for pro-lifers, as Perry seems to suggest by invoking the Tenth Amendment. The goal is a Human Life Amendment or, at a minimum, a federal statute banning abortion coast-to-coast. If you believe abortion is murder, why on earth would you want to let any state choose to legalize it? Huckabee made that point succinctly during the 2008 campaign; watch the end of the clip below.

Maybe Perry’s position on this mirrors his position on gay marriage. His argument for the Federal Marriage Amendment is that it would require ratification by three-fourths of the states, so the process honors the federalist principle of the Tenth Amendment even though the FMA would trump it. He could make the same argument for the HLA, although (a) a hardcore believer in the Tenth Amendment presumably wouldn’t want to see the sovereignty of any state trumped, even if three-quarters of the other states agree, and (b) if he didn’t make the same argument for the HLA, he’d have to explain why he thinks gay marriage requires a national solution but abortion doesn’t.

But maybe none of this matters. Neither the HLA nor the FMA will ever pass, so all we’re doing is polishing credentials here — and his already have plenty of polish. The latest whispers from his advisors, incidentally, claim that he’ll be in by late August. In fact, he’s already nudging Fox about a spot in the August 11 debate.

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Guess who’s gotten pretty quiet this week

posted at 4:28 pm on July 28, 2011 by Ed Morrissey
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Jim Geraghty notices that the man who has spent July all over our TV screens now seems strangely … shy:

This is not a complaint, but an observation: President Obama has made no public speeches, appearances, or remarks since Monday night.

According to CBS News’ Mark Knoller, he has no public or press appearances scheduled for today.

This seems more than just a coincidence. After all, this is crunch time on the debt ceiling. If the President wanted to pick a time for conspicuous leadership, this would be it. By tomorrow, there may not be enough time to get any solution through Congress, let alone one the White House likes.

Jim speculates that Obama’s advisers may have decided that Obama’s media blitz the last three weeks has just not moved the needle, but I think it goes farther than that. I’d guess that the White House is getting worried about Obama’s relentless scolding while pursuing the no-plan strategy. The White House press corps has begun insisting on seeing Obama’s plan in writing, and since it’s not forthcoming, Obama’s team may be afraid of putting him out in public.

This could also reflect some frustration from Senate Democrats. The Reid and Boehner plans share a similar structure, and Reid might want to get the Senate into position to pass his proposal so that a conference committee can quickly produce something that will pass both chambers. Having Obama out front demagoguing the issue doesn’t help move that process along, as Republicans could filibuster Reid’s efforts if they really dig in their heels.

But Jim has the bottom line right — Obama very obviously didn’t help matters over the last three weeks with his all-mouth, no-plan strategy. If one doesn’t want to offer a solution, then perhaps the One shouldn’t be spouting off about those who do — and have.

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Boehner: We, er, don’t have the votes — yet; Update: 25 Republicans leaning no? Update: Boehner still short as of 4 p.m.

posted at 3:50 pm on July 28, 2011 by Allahpundit
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He can afford to lose 23 Republicans, I believe. Number of Republicans leaning or confirmed no as of 2 p.m.: 22.

As much as the left hates having to make token concessions on spending, a GOP meltdown on the House floor tonight would be be a mighty fine consolation prize.

House Speaker John Boehner continued to lobby fellow Republicans to back his debt bill Thursday, telling members at a closed-door meeting, “We don’t have the votes yet,” according to a Republican in the room. But he added, “Today is the day we’re going to get it passed.”

As part of that lobbying effort, House GOP leaders agreed to add a last minute sweetener for conservatives who have been pushing for a balanced budget amendment to ensure future spending cuts actually happen.

House Republicans plan to have a pair of votes Friday on two versions of a balanced budget amendment to the Constitution. One version, if adopted by the states, would require that the government maintain a balanced budget. The other version, one that conservatives have long been pushing, would also require a supermajority vote in both chambers to approve any tax increases.

The supermajority requirement on tax hikes cinched it for Mike Pence, who’s now a yes. Nearly 30 of the GOP’s 87 freshmen also announced today that they’re backing Boehner, so momentum is with the leadership. Just one question: Er, what happens if Reid makes good on his threat to kill Boehner’s bill in its crib tonight?

No one knows:

“We’re going to put all this at the doorstep of Harry Reid,” Rep. John Fleming (R-FL) told reporters Thursday. I asked whether Boehner had prepared caucus members for the possibility that they’ll have to grapple with yet another compromise — this one between Boehner’s bill and a similar plan Reid wrote himself.

“No, no discussion about that at all,” Fleming said.

Rep. Allen West (R-FL) — a conservative supporter of Boehner plan — says Republicans are looking no farther than Thursday’s vote. “The bottom line is this: What happens after this really depends on Harry Reid, and hopefully they get beyond the do-nothing aspect that they have shown in my time since I’ve been up here, and they move on this.”

So Boehner’s strategy, I take it, is to win this vote by the skin of his teeth, then be forced into some sort of compromise with Reid after the bill dies in the Senate, and then sell the new, even more watered-down bill to House conservatives who are already groaning about having to line up behind Boehner? Unless there’s a market panic tomorrow, how does he win that vote? And Reid’s strategy, as I understand it, is to convince Boehner not to waste precious time by moving ahead with this vote since the bill’s doomed anyway — even though that sort of public ultimatum is guaranteed to force Boehner’s hand and nudge House Republicans into rallying behind him, with the GOP then sure to blame Reid’s rejectionism as the true stumbling block to an economy-saving deal. Huh.

Whether intentionally or not, though, Reid’s ultimatum gives Boehner a face-saving excuse if it turns out he can’t get to 218 before the vote. Having to yank the bill because his own caucus won’t support it would be a catastrophic embarrassment. Having to yank the bill because those damned Democrats in the Senate refuse to agree to a short-term deal that’s politically inconvenient for Obama is simply bowing to political reality. Boehner’s been meeting one on one with reluctant Republicans all day; if 5 p.m. rolls around and he doesn’t have the votes, he’ll pull it and then say he had no choice because there isn’t enough time left before August 2 to push bills that have no hope of becoming law. Which brings us back to the “what then?” question posed above.

Here he is at today’s presser. Exit question: Can we all agree, at least, that the S&P’s influence on our little national crisis is way, way greater than it should be? Whether you think they’ve been too pessimistic or not pessimistic enough, given their track record, why should we care what they think?

Update: Things are in flux and votes may (and probably will) change, but Think Progress’s whip count finds 25 Republicans leaning or confirmed no. That leaves Boehner two votes short and there are no House Democrats who are budging.

Update: National Journal still counts just 22 GOP no’s. And even better for Boehner, because of Democratic absences, he only needs to get to 216 for a majority, which means he can lose 24 Republicans and still win.

Update: A Twitter pal notes that Boehner won’t need tea party votes on a compromise bill with Reid since he’ll pick up Democratic votes on that one too. Absolutely; I didn’t mean to imply otherwise. But House progressives will peel off on that one in all likelihood and there aren’t many Blue Dogs left, so Boehner may yet need a few conservatives to join moderate Republicans in pushing him over the top. Can he get them? With the default deadline bearing down, yeah, probably.

Update: The Hill files a new story at 4:08 p.m.: Boehner’s still short.

There are 22 House Republicans who will vote no or are leaning no, according to The Hill’s whip count. There are more than three dozen Republicans who are publicly undecided, and 12 of them said or suggested on Thursday that they are still on the fence.

Boehner and his top lieutenants were scrambling for votes Thursday in anticipation of this evening’s vote, expected at around 6 p.m…

Rep. Jeff Flake (R-Ariz.) told reporters he was still leaning no on the bill and questioned whether it would be the GOP’s last chance to influence the debt limit debate. He speculated that the Senate could send Reid’s measure back to the House, which he said was similar to Boehner’s proposal, and then the House could attach a clean balanced budget amendment and send it back to the Senate.

Maybe Reid’s ultimatum convinced fencesitters that there’s no point taking a tough vote for a bill that’s destined to die anyway, whatever the consequences may be for Boehner’s prestige. Anyone want to start a pool on what time, precisely, we’ll hear that Boehner is pulling the bill from the floor?

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Reid: Hey, who’s up for killing another debt-ceiling increase?

posted at 2:30 pm on July 28, 2011 by Ed Morrissey

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Must be nice to have a job that doesn’t actually require any work, except to refuse to work at all:

House Republicans are just wasting their time debating Speaker John Boehner’s debt reduction bill, Senate Majority Leader Harry Reid said today.

“Boehner’s bill dies tonight,” Reid communications director Adam Jentleson wrote on Twitter. “Forever.” …

“As soon as the House completes its vote, the Senate will move to take up that bill,” Reid said, “and it will be defeated tonight.”

“No Democrat will vote for a short-term Band-Aid that would put our economy at risk and put the nation back in this untenable situation a few short months from now,” he said.

To which the answer should be: “Where’s the Senate plan?” The Politico article has Harry Reid standing in front of a display that reads, “In the battle of budget scores, Senate plan is a clear winner over Boehner plan.” That was certainly true of the Boehner 1.0 plan, but it’s less clear that it’s true about Boehner 1.1. Either way, Reid’s bill only reduced actual spending by $750 billion rather than Boehner 1.0′s $710 billion over a ten-year period, so neither was exceptionally robust in scoring. It’s a bit like bragging about winning a football game when the only score comes off of a safety.

But that argument assumes the Senate will actually produce a plan. So far, even though Reid controls the majority and the floor, we haven’t even seen a hint of a vote. In fact, we haven’t seen the Senate originate any budget bill in over 800 days. Since Reid’s plan doesn’t include new taxes — or at least that’s his claim — it doesn’t have to originate in the House.

The proper legislative process should be for both chambers to work on their own versions of legislation and form a conference committee to produce a bill for up-or-down votes in each chamber. Reid could have done that with the CCB bill, had he chosen to do so, although there would have been very few commonalities between a Senate response and the CCB around which to compromise. That’s not true of the Boehner 1.1 bill; as National Journal noted yesterday, they have quite a bit in common, including the level of cuts. All that needs to happen is to get the Senate to pass its bill and let the conference committee hammer it out. That can even take place after a vote to kill Boehner 1.1.

If all Reid does is vote to kill the Boehner plan, however, then nothing can happen. Reid wants to bully the House into doing his work. The House should tell Reid to do his job rather than worry about doing theirs. If Democrats never plan to make a proposal, then they should just pass Boehner 1.1, and Republicans should call a halt to any further efforts until Democrats start taking their responsibilities seriously.

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Weekly jobless claims dip below supposedly significant 400,000 level

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posted at 10:30 am on July 28, 2011 by Tina Korbe

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Not sure what accounts for this (and the Labor Department offers no specific explanation either), but a 15-week streak of 400,000+ weekly jobless claims ended last week.

Claims dropped to 398,000, a decrease of 24,000 from the previous week’s revised figure of 422,000, according to figures released today by the Department of Labor.

Economists consider 400,000 to be a crucial number — the number below which jobless claims need to drop to make a difference in the unemployment rate or to achieve stability in the labor market. But, as Ed has explained in the past, that’s somewhat of a myth:

Take a look at the historical series of weekly claims between December 2005 and December 2007, the last time we really had “stability” in the labor force. The highest number in that period was 355,000 in a week, and that was in December 2007 when the economy slid into recession. In fact, between January 2004 and January 2008, we had only two weeks of 400K-level weekly claims, both in September 2005, and they were very much the exception. The average for that four-year span is 326,735, and the median number is 324,000 — which is why I usually use the 325K number in my analyses. We actually didn’t get to the 400K level until July 2008, at which point no one considered the labor market “stable.”

So, we still have a long way to go. Still, it seems like a hopeful sign to me that the four-week moving average also declined to 413,750, a decrease of 8,500. Even if it’s only for this week, I’ll rejoice in the lower figures and even call ‘em “unexpected,” even if that does mean Ed might accuse me of sounding like Reuters.

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New numbers, no surprise: Affordable Care Act anything but affordable

posted at 9:50 am on July 28, 2011 by Tina Korbe
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We already knew this, but, today, the Centers for Medicare and Medicaid released a 10-year forecast that confirms it: National health spending will grow at a rate faster than it would have if Obamacare had not passed. The Washington Times reports:

    Total spending is projected to grow annually by 5.8 percent under Mr. Obama’s Affordable Care Act, according to a 10-year forecast by the Centers for Medicare and Medicaid Services released Thursday. Without the ACA, spending would grow at a slightly slower rate of 5.7 percent annually. …

    The federal government is projected to spend 20 percent more onMedicaid, while spending on private health insurance is expected to rise by 9.4 percent. …

    “Simply put, this report states the obvious, that Americans have known for more than a year – the $2.6 trillion law only makes the fundamental problem of skyrocketing health care costs worse,” said Sen. Orrin G. Hatch, Utah Republican and ranking member of the Senate Finance Committee.

The White House responded to the report in a blog post, spinning the report to emphasize, “National Health Expenditures Reach Historic Low.” White House Deputy Chief of Staff Nancy deParle writes:

    But the report doesn’t tell the whole story.

    The Affordable Care Act creates changes to the health care system that typically don’t show up on an accounting table. We know these new provisions will save money for the health care system, even if today’s report doesn’t credit these strategies with reducing costs.

The report comes just as the legal challenges to the ACA reach the Supreme Court. At the same time, ads from RepealItNow.com report the drive for congressional signatures on a petition for repeal continues to be successful. In the ads, a congenial Mike Huckabee says the coalition needs the signatures of just four senators to make repeal possible. (Maybe those same four senators could revive Republican hopes of Cut, Cap and Balance!) That’s a stretch, of course — the best strategy for repeal remains to capture the Senate and White House in 2012 (and as much as I don’t want to admit it, that’s the best strategy for Cut, Cap and Balance, too). But the point is, grassroots organizations continue to bring the heat, even as health care reform seems to have fallen off the radar in debt and deficit discussions and in national news media, in general. This new report only provides more fodder for their efforts.

Obviously, that doesn’t mean the report is good news. Rising health costs affect us all and, frankly, seem especially daunting in light of our present economic outlook. So, as someone who has accepted that entitlement programs won’t carry me through retirement or future health problems, I find it helpful to remember that the best approach to health care to keep personal costs down, at least, is to attend to the basics — you know, right diet, regular exercise and ample sleep. Easier said than done, of course, but still worth attempting.

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Perry pulls into statistical tie with Romney in Gallup poll

posted at 12:05 pm on July 27, 2011 by Ed Morrissey
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Of all the potential late entrants into the Republican nomination contest, the one who gives Mitt Romney the toughest fight is Rick Perry, according to the latest Gallup poll.  If Perry, Sarah Palin, and Rudy Giuliani all get into the race, Perry comes in just two points behind Romney and ahead of Palin and Giuliani, while Michele Bachmann falls to fifth place — well within the margin of error:

    Mitt Romney is the leader for the GOP nomination among the current field of official candidates, supported by 27% of Republicans, compared with 18% for Michele Bachmann. However, Rick Perry would essentially tie Romney, with Sarah Palin and Rudy Giuliani close behind, in a scenario in which all three of these undecided candidates entered the race.

    Gallup asked respondents to choose among all 11 current and potential candidates, and then asked for their second and third choices. The second and third choices are used to simulate preferences when certain combinations of unannounced candidates are excluded from the race. Three such scenarios include the eight announced candidates plus one of the unannounced candidates. Palin, Perry, and Giuliani finish in no worse than a statistical tie for second place when each is pitted against the eight firm candidates.

If only Perry gets in the race, he starts off five points behind Romney — and five points ahead of Bachmann, who loses four points in the transaction.  Palin comes in at 15 if alone, one point behind Bachmann in a statistical tie for second place, while Giuliani gets 14%, three behind Bachmann for third place, without Palin or Perry.  Romney holds 23% in each model.

The numbers between conservatives and moderates/liberals are also interesting.  Gallup didn’t run separate models for that breakdown as they did with the overall numbers, but if all three jump into the race, Perry ties Romney for the lead with conservatives at 18%.  His support drops off considerably with moderates/liberals, finishing tied for fifth place with Bachmann.  Giuliani wins that demographic at 16%, two points ahead of Romney and Palin.  Somewhat surprisingly, Palin only scores 11% among conservatives, a fourth-place finish behind Romney, Perry, and Bachmann.

Needless to say, the other candidates in the field barely change positions with or without the three late entrants.  All of them had better hope for lightning to strike in Ames in a couple of weeks, at the debate and then at the straw poll.  Without some sort of breakout performance, an entry of any of the three maybes will swamp out any hope of getting the kind of media attention that will build momentum in the fall

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CBO: Reid bill a bigger reduction in spending … barely

posted at 11:25 am on July 27, 2011 by Ed Morrissey
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The Washington Times reports today that the duel of spending reduction bills may be won by Harry Reid.  The CBO scored Reid’s proposal better than John Boehner’s on actual reductions in spending, although neither takes a machete to the budget.  In fact, the difference is almost indistinguishable:

    The Congressional Budget Office said the plan by Senate Majority Leader Harry Reid would raise the government’s borrowing limit by $2.7 trillion, and cut $2.2 trillion from future spending, chiefly by limiting the amount of money spent on the wars in Iraq and Afghanistan. …

    The CBO analysis could give momentum to Mr. Reid’s plan, though the GOP says spending on the wars in Iraq and Afghanistan was going to drop anyway, and so shouldn’t be considered as future savings. …

    The CBO said the Senate bill’s discretionary spending cuts would result in $840 billion in lower authorized spending, and $750 billion in actual lower outlays over the next decade. The Senate bill also capped spending on the two wars at $450 billion over the next decade, which would mean spending authority is $1.2 trillion lower, and actual outlays would be $1 trillion lower.

Reid’s advertising his proposal as authorizing $2.2 trillion in cuts for a $2.7 trillion debt-ceiling increase, but most of those cuts would happen anyway.  Reid counts dollars spent on the war at current rates as part of the savings when the drawdowns occur, savings that are already in place.  Instead, his bill cuts in 10 years roughly half of the annual budget deficit, averaging $75 billion a year, which is roughly nineteen days of borrowing at current deficit rates.

That’s an improvement over Boehner’s bill, but not by much.  Boehner would save $710 billion over the next decade, averaging $71 billion a year, which accounts for 17.3 days of borrowing at the current rate of deficit spending.  That’s more of a distinction without a difference.  Boehner’s bill would only authorize a $900 billion hike in the debt limit, however, which would force a new round of cuts before next year’s election.  Unlike Reid’s proposal, Boehner assumes that the savings in war funding have already taken place.

Boehner promised to go back and rewrite the House bill to get more savings out of it.  Given these figures, that shouldn’t be a terribly difficult task.  However, at this point, it looks like the two chambers are close enough in figures and approaches to pass their bills and get a conference committee to deal with the differences, which is probably what will happen by the end of the week.

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Battleground states looking grim for Obama?

posted at 10:05 am on July 27, 2011 by Ed Morrissey
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National polls put Barack Obama in the mid-40s and slightly underwater, which could indicate trouble for him in 2012 — if the Presidency was won on a national popular vote.  (Ask Al Gore how that works out.)  National Journal took a look at polling in battleground states and sees a much bigger problem than national polls indicate:

    In every reputable battleground state poll conducted over the past month, Obama’s support is weak. In most of them, he trails Republican front-runner Mitt Romney.  For all the talk of a closely fought 2012 election, if Obama can’t turn around his fortunes in states such as Michigan and New Hampshire, next year’s presidential election could end up being a GOP landslide.

    Take Ohio, a perennial battleground in which Obama has campaigned more than in any other state (outside of the D.C. metropolitan region). Fifty percent of Ohio voters now disapprove of his job performance, compared with 46 percent who approve, according to a Quinnipiac pollconducted from July 12-18.

    Among Buckeye State independents, only 40 percent believe that Obama should be reelected, and 42 percent approve of his job performance. Against Romney, Obama leads 45 percent to 41 percent—well below the 50 percent comfort zone for an incumbent.

    The news gets worse from there.  In Michigan, a reliably Democratic state that Obama carried with 57 percent of the vote, an EPIC-MRA pollconducted July 9-11 finds him trailing Romney, 46 percent to 42 percent. Only 39 percent of respondents grade his job performance as “excellent” or good,” with 60 percent saying it is “fair” or “poor.” The state has an unemployment rate well above the national average, and the president’s approval has suffered as a result.

Obama also trails Romney in New Hampshire, getting edged by two points.  More worrisome for the White House is Obama’s standing in these states, and others like them.  Regardless of who the nominee is, having re-elect numbers in the low 40s is a clear sign that the state is up for grabs. And it’s not just these states, either.

If Michigan is in play — and it almost certainly will be — then Pennsylvania and Wisconsin probably are as well, and Indiana may already be lost.  That Rust Belt band played heavily into Obama’s victory in 2008.  Hillary Clinton Democrats, primarily white working-class voters, turned out for Obama in 2008, but those are the voters Obama is losing fastest in this cycle.  National Journal wonders whether Obama can hold Colorado, Nevada, and Virginia, but they miss North Carolina, where Obama’s standing has already shown to be crumbling, too.

Most presidential re-election runs have some element of defense to hold territory won in the previous election, but that may be the only strategy Obama can put in play.  Obama won the Electoral College handily in 2008, 365-173.  By flipping Pennsylvania, Ohio, Florida, Indiana, Colorado, Virginia, Nevada, and Wisconsin, Republicans edge Obama 295-243.  Swapping Florida for North Carolina still produces a 281-257 win for Republicans.  Winning Michigan and conceding Colorado makes it 288-250 Republicans.

You can bet that the Obama campaign is studying the map very, very carefully in order to see where they want to spend money, and it’s mostly going to go in that Rust Belt area.  Republicans should plan accordingly.  That could be the key to the entire election

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Euro Posts Weekly Gain After Two Weeks of Losses

EuroThis week was “a mixed blessing” for the euro. For the most part, the currency showed a good performance as worries about the debt crisis subsided, but by the end of the week concerns returned.

The summit of the European Union leaders caused optimism among Forex traders, who anticipated some cohesive plan for dealing with the sovereign-debt crisis. The summit ended, a plan was presented, but traders didn’t look very happy about the outcome. Surely, some market participants were pleased by the plan of the EU leaders, but most investors aren’t sure that suggested measures would help to deal with the problems in the longer run, not to mentions concerns about expected Greek default.

The shared 17-nation European currency also get boost from the US, where politicians aren’t able to reach agreement about measures to battle the US debt crisis, making the dollar less appealing than the euro. But the decline of the euro against some currencies on Friday made traders feel uncertain about the euro. Was that drop just a minor correction or a first step in a long way down? It’s hard to tell as currently the euro, along with the dollar, is one of the worst currencies to trade because of its unpredictability.

EUR/USD jumped from 1.4109 to 1.4356 and EUR/JPY advanced from 111.58 to 112.75 over this week. EUR/CHF, unlike the previous two currency pairs, hasn’t declined on Friday, rose from 1.415 to 1.768 during this week and posted a weekly high of 1.1891.

If you have any questions, comments or opinions regarding the Euro, feel free to post them using the commentary form below.

Earlier News About the Euro:

    Euro Drops as Optimism Caused by EU Summit Wanes (2011-07-22)
    Euro Jumps as EU Leaders Make Plan to Help Greece (2011-07-21)
    Is Agreement Among European Leaders Attainable? Perhaps (2011-07-19)
    Bad Monday for Euro (2011-07-18)
    Euro Recovers on US Trade Balance, Threatened By Ireland (2011-07-13)

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Sixth Quarter of Gains for Yuan

Chinese yuanThe Chinese yuan posted the sixth straight quarterly gain on the speculation that China will allow the currency to appreciate faster in order to slow growth of consumer prices.

The People’s Bank of China increased the reference rate for the yuan to 6.4716 per dollar today, allowing the currency to fluctuate 0.5 percent in either side of the target. Li Daokui, the adviser to the central bank, explained the rise of prices in June by higher costs of agricultural products and pork. China Securities Journal said today, citing the State Information Center, the inflation is estimated to be 5.3 percent in the first half of 2011 and about 4.9 percent for the whole year.

USD/CNY traded at 6.4648 today as of 11:22 GMT, fluctuating near its opening rate of 6.4644, after rising as high as 6.4680 and falling as low as 6.4625.

If you have any questions, comments or opinions regarding the Chinese Yuan, feel free to post them using the commentary form below.

Earlier News About the Chinese Yuan:

    Yuan Appreciates Above 6.5 vs. USD for a Short Time (2011-04-29)
    Chinese Yuan Appreciates with Other Asian Currencies (2011-04-02)
    China Allows Yuan Appreciate, Can It Do So? (2011-01-12)
    Yuan Rises Beyond 6.6 per Dollar as China Battles Inflation (2010-12-31)
    Can Yuan's Gains Be Limited by Demands for Slower Appreciation? (2010-12-

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Yuan Appreciates Above 6.5 vs. USD for a Short Time

Chinese yuanThe Chinese yuan rose above the 6.5 level against the US dollar today for several hours before returning to the levels below this important psychological rate.

The yuan reference trading rate was moved up to 6.499 per USD by the People’s Bank of China today. The currency is allowed to appreciate or depreciate within 0.5 percent boundary during a daily trading session, allowing an intraday low on the USD/CNY currency pair of 6.4805.

The main reason for this long-awaited (at least in the United States) strengthening of the yuan is seen in the rising inflation of the consumer prices in China. Another positive factor for this regulated currency is the prolonged weakness of the US dollar, which continued to fall against other major currencies this week.

USD/CNY rose from 6.5027 to 6.5060 as of 12:39 GMT today, following a drawdown to 6.4805 between 6:00 and 8:00 GMT.

If you have any questions, comments or opinions regarding the Chinese Yuan, feel free to post them using the commentary form below.

Earlier News About the Chinese Yuan:

    Chinese Yuan Appreciates with Other Asian Currencies (2011-04-02)
    China Allows Yuan Appreciate, Can It Do So? (2011-01-12)
    Yuan Rises Beyond 6.6 per Dollar as China Battles Inflation (2010-12-31)
    Can Yuan's Gains Be Limited by Demands for Slower Appreciation? (2010-12-29)
    Yuan Slips as China Raises Interest Rates and May Do So Again (2010-12-27)

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Rand Near Monthly High vs. USD on Rate Difference, US Uncertainty

South African randThe South African rand rose to its highest level in more than two weeks against the US dollar today, as the rate difference attracted speculators, while they shunned uncertainty of the States.

While President Obama continues to press the Congress for the debt ceiling compromise, there’s no end seen to these prolonged debates. Next Tuesday can become one of the worst days in dollar’s history if nothing changes until that. As the global investors have the fact in mind, many of them a reluctant to keep their assets in USD. The recent behavior of the South African rand is showing an elevated interest in this currency.

On the other hand, there’s another attractive advantage in the ZAR for the foreign currency traders — its interest rate (5.5 percent compared to almost zero in the US). Being the Africa’s biggest economy, South Africa is also considered a fiscally and financially stable region, closely tied to the commodity prices (especially gold), which makes it a near-perfect target for short-term currency investments. Five days ago, the South African Reserve Bank has left the rates unchanged, signaling that the period of high rates may continue further.

USD/ZAR fell from 6.7619 to 6.6744 as of 14:53 GMT today, reaching as low as 6.6658 intraday — the maximum level since July 8th.

If you have any questions, comments or opinions regarding the South African Rand, feel free to post them using the commentary form below.

Earlier News About the South African Rand:

    Rand Weakened by Credit Rating Outlook for Greece (2011-07-05)
    Rand Weakens with Commodities on US Growth Forecast (2011-06-23)
    South African Rand Falls on Greek Crisis, Trims Losses (2011-06-20)
    South African Rand Climbs vs. Dollar on Greece's Bailout (2011-06-02)
    Rand Advances vs. Dollar on Economic Growth (2011-05-27)


This entry was posted on TopForexNews on Tuesday, July 26th, 2011 at 2:56 pm and is filed under South African Rand. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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CAD Sets New Multi-Year Record on US Crisis Expectations

Canadian DollarThe Canadian dollar expanded today, reaching a new 3-year maximum level versus the US currency, as the President of the United States warned of a serious “economic crisis”.

The loonie (as the CAD is nicknamed) reached its new record level against the US dollar today — the highest since November 2007. While there aren’t many supporting news for the Canadian dollar (except for persistently high levels of oil price), the loonie wins as an alternative to the greenback, which suffers from the debt ceiling crisis in the United States.

Sentiment for the US currency weakened after US President Barack Obama warned that a heavy economic crisis is threatening the world’s largest economy (and, consecutively, the global economy too) if no compromise is reached before August 2.

USD/CAD fell from 0.9474 to 0.9424 as of 12:47 GMT today, setting its new yearly record low at 0.9406. CAD/JPY rose from 82.56 to 82.77, while EUR/CAD went up from 1.3620 to 1.3646 today.

If you have any questions, comments or opinions regarding the Canadian Dollar, feel free to post them using the commentary form below.

Earlier News About the Canadian Dollar:

    Canadian Inflation Slows, Loonie Retreats (2011-07-22)
    CAD Reaches Three-Year High vs. USD (2011-07-22)
    BOC Rate Statement Invigorates Loonie (2011-07-19)
    Canadian Dollar Looks More Attractive After EU Stress Tests (2011-07-15)
    Loonie Declines vs. Greenback, Remains Strong vs. Majors (2011-07-12)


This entry was posted on TopForexNews on Tuesday, July 26th, 2011 at 12:53 pm and is filed under Canadian Dollar. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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Reid: I have an exciting new compromise debt deal for you radical right-wing extremists

posted at 6:00 pm on July 25, 2011 by Allahpundit
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The Corner has a rundown of Boehner’s two-step short-term proposal — lots o’ buck-passing to a commission plus some procedural chicanery a la Mitch McConnell’s proposal plus a vote on a balanced-budget amendment down the line — but I think it’s a nonstarter. The Cut, Cup, and Balance coalition has already rejected it, which, if all members abide by that, means Boehner’s bill would start without 39 GOP votes in the House and 12 Republican votes in the Senate. Maybe the CCB crowd is playing good cop/bad cop with Boehner, trying to frighten the White House and Reid into agreeing to more concessions as the deadline looms, but eyeball their membership roster. Usually they mean what they say.

As for Reid’s plan: $2.7 trillion in cuts and no tax hikes — but no entitlement reform either, and fully $1 trillion of those “cuts” are merely the savings the feds have already been counting on from winding down the wars in Iraq and Afghanistan. Obama endorsed it about an hour ago, notwithstanding his weeks-long demand for new revenue, because it ensures that the next debt-ceiling debate won’t happen until 2013 and thus achieves his main/only goal of helping him get reelected. In fact, per Ed’s post this morning, remember that as of this weekend Boehner’s short-term plan was Reid’s plan. They were going to present it as a bipartisan compromise until The One intervened and reminded Dingy Harry what’s truly important to America, namely, another four years of Barack Obama. So Reid caved, even though Obama surely would have signed Boehner’s plan, and threw this thing together as quickly and haphazardly as he could. How haphazardly? Feast your eyes.

And that’s where we are at right now. Check back in an hour or two and we’ll probably have another 15-20 new proposals to fill you in on. Via Greg Hengler, here’s Dingy’s salute to the CCB coalition, which inexplicably makes it even harder for moderate Republicans in the House and Senate to vote for his plan. Which GOPer would want to take sides against the tea party with a guy who’s dumping on them as “extremists”? Exit question: Doesn’t Reid have the upper hand on Boehner right now? We already know that the GOP caucus is split over Boehner’s proposal whereas the Democrats might support Reid’s plan fairly uniformly, especially in the Senate. It’ll be a tough sell to progressives in the House, but the fact that it doesn’t touch entitlements and that Obama’s backing it (and sure to talk it up during his speech tonight) makes things somewhat easier. If Pelosi/Hoyer can deliver 100 Democrats in the name of averting default, Boehner might be able to deliver 120 Republicans, especially now that some righties are half-praising Reid’s bill as not so bad

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GOP lawmakers officially announce “imperfect” plan, in which “no side gets what it wants”

posted at 5:20 pm on July 25, 2011 by Tina Korbe
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House GOP leaders were perfectly candid in their assessment of the deficit-reduction-and-debt-limit-increase plan they put before the House today.

“It’s not ‘Cut, Cap and Balance,’” House Speaker John Boehner (R-Ohio) said. “But it is built on the principles of ‘Cut, Cap and Balance’ that can pass the United States Senate, as well as the United States House.”

House Majority Leader Eric Cantor (R-Va.) echoed Boehner.

“The plan we just introduced is a well-thought-out and reasoned plan in which no side gets what it wants,” Cantor said.

As rumored, the short-term plan provides for a last-minute debt limit increase offset by even greater spending cuts with no tax increases. It also requires a vote on a balanced budget amendment — but doesn’t require that the amendment pass. The debt limit increase doesn’t carry the country through 2012, either. That means another politically-motivated round of debt limit negotiations — precisely what the president has said he doesn’t want.

“This plan is not perfect,” House GOP Whip Rep. Kevin McCarthy (R-Calif.) said. “But it shows a great contrast to what the president has put forward. The president continues to pick politics over people. His only concern when you listen to him is, he brings up the election. We’re more concerned about policies, with the direction this country is going.”

The president is scheduled to respond to Boehner’s plan at 9 p.m. tonight and the Speaker will likely respond to the president’s response.

The plan is not dreadful for a short-term deal. As many have pointed out, the no-tax part, in particular, represents a significant victory for Republicans. But the nature of the cuts aren’t clear and the debt limit increase will be upfront. The deal has already engendered fierce opposition from the “Cut, Cap and Balance” coalition. Realists might suggest time is running out for a reworked “Cut, Cap and Balance” to make its way through the House and Senate — but conservatives counter that “more of the same” in terms of a short-term deal that does nothing to ensure a balanced budget in the future betrays the American people, who sent Tea Partier after Tea Partier to Congress to combat “business as usual.”

In case anyone else has as severe a case of whiplash as I do from the this-is-the-plan, no-that-is-the-plan back-and-forth, it’s helpful to remember no plan is “the” plan until it’s written down, passed and signed. This short-term deal very well could be that, but, until it is, I’m still in the “Cut, Cap and Balance” camp. Of course, Republicans are just looking for a deal that will pass (and that’s understandable) — but, like Erick Erickson, I refuse to offer absolution to tired GOP-ers who’ve abandoned the plan. Too many Democrats have opposed a debt limit increase in the past and too many have expressed openness to a balanced budget amendment to dismiss “Cut, Cap and Balance” as extreme or to pronounce it “over, done and dead,” as Senate Majority Leader Harry Reid has tried to do. Perhaps a short-term deal will relieve the pressure of the negotiations momentarily, but it won’t solve the fundamental problems like “Cut, Cap and Balance” would. CCB is still the best plan on the table — one worth reviving and one worth fighting for.

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Obama: I wish I could bypass Congress and change things on my own

posted at 4:02 pm on July 25, 2011 by Allahpundit
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Via National Journal. He’s quick to add, “But that’s not how our system works.” Doesn’t it? Bypassing Congress to whatever extent possible has been his strategy for more than a year, culminating in an unauthorized war in Libya that even his own lawyers believe is illegal. (FYI: According to Mike Mullen, that war is now indeed a “stalemate.”) Scarcely a day passes without a new op-ed by some lefty law professor arguing that the Fourteenth Amendment lets Obama raise the debt ceiling unilaterally, despite decades of congressional precedent to the contrary. And ICE has already decided to go ahead and consider factors championed by the DREAM Act in immigration cases despite the fact that the Act hasn’t passed. O may say “no we can’t” here to the suggestion of executively-imposed amnesty, but in light of the above, can you blame the La Raza crowd for thinking (and chanting) “yes we can”?

George Will, describing The One as “Huey Long with a better tailor,” has had enough:

    Inordinate self-regard is an occupational hazard of politics and part of the job description of the rhetorical presidency, this incessant tutor. Still, upon what meat doth this our current Caesar feed that he has grown so great that he presumes to command leaders of a coequal branch of government? He once boasted (June 3, 2008) that he could influence the oceans’ rise; he must be disabused of comparable delusions about controlling Congress.

    When he was a lecturer on constitutional law, he evidently skipped the separation-of-powers doctrine. But, then, because this doctrine impedes the progressives’ goal of unleashing untrammeled government, they have long loathed it: Woodrow Wilson, the first president to criticize the American founding, considered the separation of powers the Constitution’s “radical defect.”

    It has, however, rescued the nation from Obama’s preference for a “clean” debt-ceiling increase that would ignore the onrushing debt tsunami. There are 87 reasons for Obama’s temporary conversion of convenience to the cause of spending restraint — the 87 House Republican freshmen. Their inflexibility astonishes and scandalizes Washington because it reflects the rarity of serene fidelity to campaign promises.

The true stupidity of this clip, of course, is that — as with everything else — his constitutional faux-modesty is motivated by getting reelected. It’s not that he has some profound separation-of-powers objection to an executive amnesty; it’s that he knows independents would seethe at the power grab, especially on an issue as sensitive as immigration, and it’d end up hurting him badly at the polls. He’s already got the Latino vote locked up. Better, then, to play it safe with indies by paying lip service to La Raza about how his hands are tied or that he “needs a dance partner,” etc. Whatever excuse works.

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The Ed Morrissey Show: Kevin McCullough

posted at 1:00 pm on July 25, 2011 by Ed Morrissey
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Today, on the Ed Morrissey Show (3 pm ET), Kevin McCullough joins us again to discuss the intersection of faith and politics. Kevin and I will talk about the latest in the debt-ceiling crisis, the possibility of legal action against Change.org, and the New York Times’ report on a study about teenagers and sex. Should parents allow teens to have sex in the house in order to promote family ties?  I’m guessing Kevin will say … no.

We’ll also talk about The Binge Thinker, Kevin and Stephen’s exploding success in independent talk radio, as well as Kevin’s new book, No He Can’t: How Barack Obama Is Dismantling Hope and Change, being released this week! Don’t forget about Kevin’s previous book, The Kind of Man Every Man Should Be: Taking a Stand for True Masculinity, either.

The Ed Morrissey Show and its dynamic chatroom can be seen on the permanent TEMS page — be sure to join us, and don’t forget to keep up with the debate on my Facebook page, too!

We’ll also cover the the case of Marizela Perez, who has been missing in the Seattle area for more three months. Marizela’s case has a connection here at Hot Air, as she is the cousin of the Boss Emeritus, Michelle Malkin. Michelle is trying to spread the word through Facebook and Q13Fox/KCPQ in Seattle. We want to encourage prayers for Marizela’s family, and also try to reach anyone in the area who knows where Marizela might be and ask them to contact the police.

The search has its own website now, Find Marizela, for the latest in the efforts to bring Marizela home. There is also a fund for the family to keep the search efforts going. Be sure to check there and at Michelle’s site for further developments, and keep the family in your prayers.

America’s Most Wanted is now on the case, too.

Michelle had an update earlier this month:

    Four months ago today, my cousin Marizela Perez disappeared from the University District in Seattle, Washington. I am devastated to tell you once again that there are no new leads or breaks in the case. Her parents have exhausted their work leave and have had to return to the East Coast. The family is weighing various legal and investigative avenues to pursue. As I reported in May, the quest to obtain Marizela’s online/text info has been an uphill battle. After months of pressing, we finally received a search warrant two weeks ago related to the case. It had been signed by a judge on April 22; we gained access to it in late June.  …

    Marizela’s Google web history was not included. The Seattle Police Department will not disclose the actual Google records to her parents so that they could pursue the search for Marizela on their own.

Keep the family in prayer.

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Rep. Issa: U.S. deserves a downgrade in credit if spending isn’t addressed

posted at 2:00 pm on July 25, 2011 by Tina Korbe
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Goldman Sachs suggests a downgrade of U.S. credit is increasingly likely and experts continue to warn that a weakened credit rating would have significant financial repercussions in the markets, but at least one member of Congress has accepted that a downgrade might be deserved.

“Until we stop spending more, we should be downgraded,” Rep. Darrell Issa (R-Calif.), chairman of the House Committee on Oversight and Government Reform, said this morning on the Fox Business Network.

The Hill reports more details:

    The credit-rating agencies Moody’s Investors Service and Standard & Poor’s both put the nation’s triple-A credit rating on review for a downgrade this month. The agencies warned that the U.S. might lose its perfect rating if the government defaulted on its debt or failed to take steps to address the deficit.

    “If America can, in fact, pay its bills, it’s AAA. If we can’t pay our bills, it doesn’t matter what rating they give us,” Issa said. “Right now we can pay our bills, but we’re heading toward the kind of spending and debt to where someday we wouldn’t be able to pay our bills, and that’s what’s gotta change.”

    Like many Republicans, Issa also indicated he does not consider Aug. 2 the drop-dead deadline to raise the debt ceiling. “[Obama] signed funding through September months ago,” he said.

Debate continues about what effects a credit downgrade could have. Some Wall Street traders say discussion about the potentially devastating effects is “much ado about nothing,” and Reuters’ James Pethokoukis says the impact would not be “as frightening as I might have assumed.”

Pethokoukis makes the astute point that the bigger repercussions would probably be political and would hinge on whether President Barack Obama or Republicans were blamed for the downgrade. With Republicans making remarks like Issa’s, it’s hard to think how the American people could fail to see which side is serious about solving the problem. Republicans won’t be sidetracked from offering solutions by discussion of a downgrade or default. On the other hand, all Obama has really done is talk up the terror of a default, even as he proves time and time again — possibly even this past Sunday if reports are true that he turned down a bipartisan debt deal — that he cares more about his reelection effort than he does about the nation’s fiscal health.

That’s what Issa is really saying here — that all the wailing in the world won’t change the reality. A falsely pristine credit rating won’t spare the U.S. from reaping what it has sowed — too much spending — and a downgrade doesn’t mean the U.S. will lose its ability to repay its obligations overnight. It will just come as yet another stark reminder that Congress eventually must make the hard decisions politicians are oh-so-good at procrastinating.

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