WebCogitoStop. Stay. Think.

In hidden vaults across the country, the US government is building a stockpile of $1 coins. The hoard has topped $1.1bn – imagine a stack of coins reaching almost seven times higher than the International Space Station – and the piles have grown so large the US Federal Reserve is running out of storage space.

Americans won’t use the coins, preferring $1 notes. But the US keeps minting them anyway, and the Fed estimates it already has enough $1 coins to last the next 10 years.

And at the current rate, the inventory will grow to $2bn (£1.3bn) by 2016, the Fed estimates.

Yet the piles have continued to grow because the law requires the US Mint to issue four new presidential coins each year even if most of the previous year’s coins remain in government vaults.

Had I a little more time right now, I’d write a snarky post making fun of the worst excesses of political correctness. The commenters say it all.

Obama ready to show mortgage holders some love

Rumors are running wild from Washington to Wall Street that the Obama administration is about to order government-controlled lenders Fannie Mae and Freddie Mac to forgive a portion of the mortgage debt of millions of Americans who owe more than what their homes are worth. An estimated 15 million U.S. mortgages – one in five – are underwater with negative equity of some $800 billion. Recall that on Christmas Eve 2009, the Treasury Department waived a $400 billion limit on financial assistance to Fannie and Freddie, pledging unlimited help.

The move, if it happens, would be a stunning political and economic bombshell less than 100 days before a midterm election in which Democrats are currently expected to suffer massive, if not historic losses. The key date to watch is August 17 when the Treasury Department holds a much-hyped meeting on the future of Fannie and Freddie.

What is happening is that the president’s approval ratings are continuing to erode, as are Democratic election polls. Democrats are in real danger of losing the House and almost losing the Senate. The mortgage Hail Mary would be a last-gasp effort to prevent this from happening and to save the Obama agenda. The political calculation is that the number of grateful Americans would be greater than those offended that they — and their children and their grandchildren — would be paying for someone else’s mortgage woes.

GM's Electric Lemon

Quantifying just how much taxpayer money will have been wasted on the hastily developed Volt is no easy feat. Start with the $50 billion bailout (without which none of this would have been necessary), add $240 million in Energy Department grants doled out to G.M. last summer, $150 million in federal money to the Volt’s Korean battery supplier, up to $1.5 billion in tax breaks for purchasers and other consumer incentives, and some significant portion of the $14 billion loan G.M. got in 2008 for “retooling” its plants, and you’ve got some idea of how much taxpayer cash is built into every Volt.

President Barack Obama ousted Gen. Stanley McChrystal as the top U.S. commander in Afghanistan on Wednesday, June 23, 2010.  Here is reaction to this event.

“And one can’t help but wonder if Barack Obama were white, would McChrystal have made the assumption that he could defy military protocol by undermining the Commander in Chief and remain above the fray?”
–Molly Secours, The Huffington Post

“War is bigger than any one man or woman, whether a private, a general or president.  As difficult as it is to lose General McChrystal, I believe it is the right decision for national security. “I welcome debate among my team, but I won’t tolerate division.”
–U.S. President Barack Obama

“…One could argue – or at least wonder – whether McChrystal didn’t willfully commit to this article and the unlimited access the reporter received to circuitously make the point that the U.S. war strategy must be midcourse corrected before it’s too late.

Maybe the general thought it was better to fall on his sword in this public — and perhaps suicidal — way in order to rescue a mission that, if he remained silent and dutiful to his commanding officer, would likely fail.”
–Fraser Seitel, Foxnews.com

“Gen. McChrystal’s remarks about senior officials exposed what has been an open secret in Washington and Kabul for months: The fissures that emerged during the Obama administration’s three-month review of war strategy last year remain, and many of the personalities involved have strained relations that have festered for months.”
–Jonathan Weisman and Peter Spiegel, The Wall Street Journal

“By pairing the decision on McChrystal’s departure with the name of his replacement, Obama is seeking to move on as quickly as possible from the firestorm.”
–MSNBC.com

“Barack Obama, as candidate and president, in effect created the IED known as Gen. Stanley McChrystal. Now that improvised explosive device has blown up in the midst of the Obama presidency. The damage is severe, if not crippling.”
–Howard Fineman, Newsweek.com

He has fired Gen. Stanley McChrystal, his combat commander in Afghanistan, in such a way that not only will the general go unmissed but his name will likely soon be forgotten.
Obama’s decision to replace McChrystal with Gen. David Petraeus is a stroke of brilliance, an unassailable move, politically and strategically.
–Fred Kaplan, Slate.com

Several news outlets are reporting that President Obama has accepted the resignation of US & NATO forces commander General Stanley McChrystal.

Obama stated that he has asked Gen. David Petraeus to replace Gen. McChrystal as the top U.S. commander in Afghanistan.

Obama met with McChrystal earlier Wednesday in the wake of politically explosive remarks the general and his aides made in Rolling Stone magazine about key administration officials. Petraeus is the head of U.S. Central Command.

Obama was “angry” after reading the general’s remarks, White House press secretary Robert Gibbs said Tuesday.

According to TIME Magazine, it was at the Wednesday meeting that Gen. McChrystal offered Obama his resignation.

The remarks in the Rolling Stone magazine article were at least an indirect challenge to civilian management of the war in Washington by its top military commander, according to Foxnews.com.

Military leaders rarely challenge their commander in chief publicly, and when they do, consequences tend to be more severe than a scolding.

Gates hand-picked McChrystal to take over the war last year, calling him a driven visionary with the fortitude and intelligence to turn the war around. Obama fired the previous commander at Gates’ recommendation.

In Kabul on Tuesday, McChrystal issued a statement saying: “I extend my sincerest apology for this profile. It was a mistake reflecting poor judgment and should never have happened.”

In the Rolling Stone article, McChrystal and his staff described the president as unprepared for their first one-on-one encounter.

McChrystal also said he felt betrayed and blind-sided by his diplomatic partner, Ambassador Karl Eikenberry. Eikenberry remains in his post in Kabul, and although both men publicly say they are friends, their rift is on full display. McChrystal and Eikenberry, himself a retired Army general, stood as far apart as the speakers’ platform would allow during a White House news conference last month.

The story characterized the general as unable to convince some of his own soldiers that his strategy can win the nation’s longest-running war, and dejected that the president didn’t know about his commendable military record.

McChrystal also said he felt “betrayed” by Eikenberry for expressing doubts about his proposed troop buildup last year and accused the ambassador of giving himself cover.

“Here’s one that covers his flank for the history books,” McChrystal told the magazine. “Now, if we fail, they can say ‘I told you so.”‘

While the rest of America was busy paying attention to the small plane that crashed into the IRS building in Austin, TX, the rest of the world has been having itself a little coup in Niger.

Diplomatic and military sources say Niger President Mamadou Tandja has been seized by mutinous soldiers during a coup attempt in Niger’s capital.

Mamadou-Tandja, Niger President

Media reports quoting senior officials say armed troops stormed the presidential palace Thursday afternoon as a meeting of government ministers was taking place.  Ministers in Mr. Tandja’s government also appear to be held captive.

A U.S. State Department spokesman said it appears there was an assassination attempt on Mr. Tandja but details are still unclear.

According to the news wire service Reuters, troops led by an army major captured Niger’s President Mamadou Tandja on Thursday after storming his palace in a four-hour gun battle that killed at least three soldiers, military sources said.

Political tensions had been high in the west African uranium exporter in recent months after Tandja changed the constitution to extend his rule last year, a move that drew widespread criticism at home and led to international sanctions.

“The coup leader has succeeded. It is being led by Major Adamou Harouna,” one Nigerien military source said. The president and the ministers were being held not far from the presidential palace in the capital Niamey, the sources added.

State radio is playing military music – a similar pattern to two coups in the 1990s.

Dressed in military uniform, a spokesman for a group calling itself the Supreme Council for the Restoration of Democracy appeared on Niger’s Tele Sahel sometime after 10 p.m. local time, surrounded by fellow members of the armed forces.

Without mentioning President Tandja, the spokesman, Col. Abdul Karim Goukoye Karimou, read from a statement saying the constitution and all institutions were suspended in the group’s move to take responsibility and ease political tension in the country. We want Niger “to be an example of democracy and governance,” the colonel said, calling for an end to “lies” and “corruption.” The coup leaders said they had ordered the country’s borders closed and had imposed a curfew.

Adrienne Diop, spokeswoman for the Economic Community of West African States, said that insurgents were holding the president with other ministers and people close to him, and that Mr. Tandja is apparently uninjured.

Mr. Tandja had been in power since 1999, when his election ended a period of coups and rebellions. He was re-elected in 2004 to a second five-year term that was to end in December. But protests arose last year as he moved to extend his grip on power, invoking extraordinary powers to rule by decree after dissolving parliament and the constitutional court, which opposed his plan for a referendum removing term limits.

International efforts to stabilize the situation, with the European Union suspending nonhumanitarian aid, failed to halt the deterioration.

From the Wall Street Journal: Greek police say a bomb exploded Tuesday evening outside an office of JPMorgan Chase in Athens, the Associated Press reports. No one was hurt, according to the report.

“It was a time-bomb at JP Morgan’s offices in central Athens,” a police official told Reuters. “The explosion damaged the outside door and smashed some windows.”

A local newspaper reportedly received a warning call prior to the explosion, according to Reuters. Police had cordoned off the area after the newspaper received the warning call.

Police cars, ambulances and fire engines have blocked streets in the upmarket central district of Kolonaki, where JP Morgan’s Greek offices are situated, a Reuters witness said.

News accounts in recent weeks have detailed how Wall Street firms helped Greece doctor its balance sheets to lie to the European Union that it was in compliance with rules governing debts to GDP ratios:

Wall Street tactics akin to the ones that fostered subprime mortgages in America have worsened the financial crisis shaking Greece and undermining the euro by enabling European governments to hide their mounting debts.

Even as the crisis was nearing the flashpoint, banks were searching for ways to help Greece forestall the day of reckoning. In early November — three months before Athens became the epicenter of global financial anxiety — a team from Goldman Sachs arrived in the ancient city with a very modern proposition for a government struggling to pay its bills, according to two people who were briefed on the meeting.

The bankers, led by Goldman’s president, Gary D. Cohn, held out a financing instrument that would have pushed debt from Greece’s health care system far into the future, much as when strapped homeowners take out second mortgages to pay off their credit cards.

It had worked before. In 2001, just after Greece was admitted to Europe’s monetary union, Goldman helped the government quietly borrow billions, people familiar with the transaction said. That deal, hidden from public view because it was treated as a currency trade rather than a loan, helped Athens to meet Europe’s deficit rules while continuing to spend beyond its means.

Athens did not pursue the latest Goldman proposal, but with Greece groaning under the weight of its debts and with its richer neighbors vowing to come to its aid, the deals over the last decade are raising questions about Wall Street’s role in the world’s latest financial drama.

As in the American subprime crisis and the implosion of the American International Group, financial derivatives played a role in the run-up of Greek debt. Instruments developed by Goldman Sachs, JPMorgan Chase and a wide range of other banks enabled politicians to mask additional borrowing in Greece, Italy and possibly elsewhere.

It could be called “A Tale of Two Rivers”. If you were corny. Or if it was two rivers. But it’s only one river: The Trinity River, passing through both Fort Worth and Dallas, and the centerpiece of urban revitalization projects in both sister cities.  And that’s about where  the similarities end:   The Fort Worth TRV is moving right along, and is actually being helped by the recession, with the estimated costs of the next phase declining by $2.6 million dollars, according to the Fort-Worth Star-Telegram.  Thirty miles away, the Dallas Trinity River Corridor Project is getting its federal funds cut.

Again.

So a quick followup to the story we had yesterday, about Republican candidate for Texas Governor Debra Medina stating that Houston is technically bankrupt.  Turns out that a few months ago, a group of CPAs sent an open letter to the members of Houston’s City Government, as well as to major US newspapers.

In it, they don’t beat around the bush on their take of the city of Houston’s finances: Turns out, Houston is broke; it just hasn’t acknowledged it yet:

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