U.S. Economic/Financial News
Another Bank Bites the Dust
Aug. 24 (EIRNS)The ninth U.S. bank to fail this yearat least, insofar as the government is willing to admit publiclyColumbian Bank and Trust of Topeka, Kansas, was officially closed by the FDIC on Aug. 22. It had $752 million in assets, and was brought down by the collapse of the housing bubble and the ensuing credit crunch. Unlike the banking behemoths, which are even more bankrupt, despite their hyperinflationary Federal bailouts, this little bank was officially pronounced dead. Its branches will be transformed into Citizens Bank and Trust offices, and will maintain customer continuity of services, at least for now.
Ending Hunger: TVA Research Benefits World Agriculture
Aug. 26 (EIRNS)Dr. Amit Roy, President of the International Center for Soil Fertility and Agricultural Development, based in Muscle Shoals, Alabama, where the TVA (Tennessee Valley Authority) began, under President Franklin Roosevelt, described the TVA's fertilizer program on Aug. 25, "as one of the most effective research and development programs of any U.S. agency." He stated: "It's time to launch a radical initiative to develop generation of energy-efficient fertilizers to help avert world hunger and famine."
From the 1950s through the 1970s, the TVA spent about $41 million on research into developing new kinds of high nutrient-content fertilizers and new manufacturing technologies. Today, these improvements are used in 75% of the fertilizer produced around the world. It is estimated that that investment leveraged $57 billion in returns, just to agriculture in the United States.
Today, scientists estimate, fertilizers are responsible for more than a third of U.S. crop production. The immediate concern is to find ways to lower the energy input for fertilizer production, in order to lower the cost, since energy has been hyperinflating. But the overall thrust is to return to public investment in fertilizer R&D, and pick up where the TVA left off.
Commerce Dept. 'Revises' GDP To Show 3.3% Growth from Fed Stimulus
Aug. 28 (EIRNS)The U.S. Commerce Department today released "revised" figures showing a 3.3% annualized rate of growth in the second quarter of this year. This is way above the 0.9% annualized growth rate imputed for the first quarter of the fiscal year. How did this happen? The Federal stimulus package, of course. The Commerce Department lauds the impact of $90 billion worth of checks sent out to consumers. However, in the real world, the following are indicative of the actual state of affairs:
* U.S. personal bankruptcy filings are up 29% year-on-year, according to a report released Aug. 27. The oldest people have the highest filing rate now. In 1991, about 8% of bankruptcies were accounted for by those 55 years and older; but in 2007, 22% of filings came from those 55 and over. Moreover, bankruptcy laws have been made tougher in recent years, but still thousandsespecially oldstershave no recourse, and qualify.
* Public school districts are slashing operations, as children return to class. For example, in California's San Marcos Unified School District, all school bus service was cancelled, except for the disabled (still required by Federal law). The entire bus fleet is mothballed; 27 drivers were laid off.
* Auto sector in the final down-spiral. e.g., Toyota Motors, the world's number two carmaker, today announced its lowered forecast for 2009 auto sales growthciting a rosy 2.1% expected increase, way down from its previous forecast of 5.6%.