American Debt

My post on debt is still in the making and will not be done in at least a month. I came across this article talking about why America is technically bankrupt. And...the printing still continues.

Neil Reynolds - The scary actual U.S. government debt

Boston University economist Laurence Kotlikoff says U.S. government debt is not $13.5-trillion (U.S.), which is 60 per cent of current gross domestic product, as global investors and American taxpayers think, but rather 14-fold higher: $200-trillion – 840 per cent of current GDP. “Let’s get real,” Prof. Kotlikoff says. “The U.S. is bankrupt.”

Writing in the September issue of Finance and Development, a journal of the International Monetary Fund, Prof. Kotlikoff says the IMF itself has quietly confirmed that the U.S. is in terrible fiscal trouble – far worse than the Washington-based lender of last resort has previously acknowledged. “The U.S. fiscal gap is huge,” the IMF asserted in a June report. “Closing the fiscal gap requires a permanent annual fiscal adjustment equal to about 14 per cent of U.S. GDP.”

This sum is equal to all current U.S. federal taxes combined. The consequences of the IMF’s fiscal fix, a doubling of federal taxes in perpetuity, would be appalling – and possibly worse than appalling.

Prof. Kotlikoff says: “The IMF is saying that, to close this fiscal gap [by taxation], would require an immediate and permanent doubling of our personal income taxes, our corporate taxes and all other federal taxes.

“America’s fiscal gap is enormous – so massive that closing it appears impossible without immediate and radical reforms to its health care, tax and Social Security systems – as well as military and other discretionary spending cuts.”

He cites earlier calculations by the Congressional Budget Office (CBO) that concluded that the United States would need to increase tax revenue by 12 percentage points of GDP to bring revenue into line with spending commitments. But the CBO calculations assumed that the growth of government programs (including Medicare) would be cut by one-third in the short term and by two-thirds in the long term. This assumption, Prof. Kotlikoff notes, is politically implausible – if not politically impossible.

One way or another, the fiscal gap must be closed. If not, the country’s spending will forever exceed its revenue growth, and no one’s real debt can increase faster than his real income forever.

Prof. Kotlikoff uses “fiscal gap,” not the accumulation of deficits, to define public debt. The fiscal gap is the difference between a government’s projected revenue (expressed in today’s dollar value) and its projected spending (also expressed in today’s dollar value). By this measure, the United States is in worse shape than Greece.

Prof. Kotlikoff is a noted economist. He is a research associate at the U.S. National Bureau of Economic Research. He is a former senior economist with then-president Ronald Reagan’s Council of Economic Advisers. He has served as a consultant with governments around the world. He is the author (or co-author) of 14 books: Jimmy Stewart Is Dead (2010), his most recent book, explains his recommendations for reform.

He says the U.S. cannot end its fiscal crisis by increasing taxes. He opposes further stimulus spending because it will simply increase the debt. But he does suggest reforms that would help – most of which would require a significant withering away of the state. He proposes that the government give every person an annual voucher for health care, provided that the total cost not exceed 10 per cent of GDP. (U.S. health care now consumes 16 per cent of GDP.) He suggests the replacement of all current federal taxes with a single consumption tax of 18 per cent. He calls for government-sponsored personal retirement accounts, with the government making contributions only for the poor, the unemployed and people with disabilities.

Without drastic reform, Prof. Kotlikoff says, the only alternative would be a massive printing of money by the U.S. Treasury – and hyperinflation.

As former president Bill Clinton once prematurely said, the era of big government is over. In the coming years, the U.S. will almost certainly be compelled to deconstruct its welfare state.

Prof. Kotlikoff doesn’t trust government accounting, or government regulation. The official vocabulary (deficit, debt, transfer payment, tax, borrowing), he says, is vulnerable to official manipulation and off-the-books deceit. He calls it “Enron accounting.” He also calls it a lie. Here is an economist who speaks plainly, as the legendary straight-shooting film star Jimmy Stewart did for an earlier generation.

But Prof. Kotlikoff’s economic genre isn’t the Western. It’s the horror story – “and scarier,” one reviewer of his book suggests, than Stephen King.

~deyao~

Drowned in awesomeness

I got two weeks of studying coming up but because of another breathtaking album by Taylor Swift, I can't help but spread the word. It's only my second day listening to it, but it has surpassed my expectations. No surprises the lyrics are again based on true stories but I really feel she has stepped it up another level. Fearless was one hell of a album, generating more album sales than any other albums at that time. Now Speak Now is set to break more records, I am very certain of that. Any doubts can be put to rest because Taylor has done an amazing job for this album.She has clearly shown she has matured and become even better over the last two years. 14 tracks on the original version album and a few others with acoustic versions on the deluxe version (red cover). For her fans, it's another incredible treat. The way she connects her stories into music is quite amazing. If you take the time to get to the meaning of the songs (she wrote every song btw) and at the same time get drowned in the excellent instrument arrangement, it won't be hard to understand why she is right on top in the industry.

~deyao~

Turning Point?

It was a slightly mixed morning, I streamed Arsenal v Braga without audio and bad video quality but I was well compensated with some beautiful football.

The summer transfer window dealings had a much better impact than I expected. I thought back on all the transfers made and I just realised Arsenal signed their first striker since Adebayor way back in 2006. It has taken sometime to fine-tune this team and Arsenal supporters have gone through very painful trial and error lessons of sub-par players. It was not a very impressive lineup of signings to start with but the impact has already been felt.

Arsenal can no longer hold on to mediocre players and this transfer window we got rid of most of the underperforming players. Players like Gallas, Silvestre, Campbell and Senderos who are either way past their prime or who simply aren't good enough have been 'weeded out'. They've given some exceptional performances during their time but their consistency were lacking and it has cost us on many occasions. And now we got Koscielny and Squillaci. Straight into the frame of the first team against Braga. One has CL experience with Sevilla and the other is making his CL debut. It wasn't the toughest test we could expect but not to concede a goal was a step in progress. The defence hasn't settled really well yet as a whole, but I would expect things to only get better. When Vermaelen returns, he can partner either one of them. Koscielny has made a few errors, although it hasn't cost us points, I could already see him improving by the week. He has moved to the toughest league in football and for his level of adaptation at this point I'm quite satisfied.

We played without Van Persie, Bendtner, Diaby or Walcott yesterday. But we lacked no firepower really, Fabregas, Nasri, Chamakh and Arshavin combined was so lethal we could compete with any top team. For Arsenal to have the whole team back and not achieving anything this season really makes no sense to me. There's enough talent in this team for sure.

Notables. Fabregas was a big notable yesterday. He probably played his best game this season.I'm really glad the patient buildup towards full fitness has gone well. He was such a maestro in the game, he showed the world once again what an extraordinary player he is. I don't want to be thinking whether his days are numbered. To see him playing at such a level in an Arsenal shirt is one of the most pleasing things I could watch today. His passing, vision and control in the game was something very rare in today's game. The Catalans are finding more reason to get their hands on him and the Arsenal board are probably thinking every day how is this 'fairytale' going to last. To me it is unreal he actually stayed, I anticipated disaster, considering his heart was already back in Catalunya, I thought it was more likely he didn't stay.

Seeing this
and this

That happiness in my heart was indescribable. Having Cesc playing for Arsenal is something you cannot put a any dollar amount on. For him to stay on and still play at his best will earn him lots of respect from the fans.

Another few notables are Jack Wilshere and Alex Song. A few people realise Jack made it into the Arsenal first team at the age of 16. It was definitely for a reason, he is really talented. Still a lot of learning to go but he is making the starting line in CL, that is quite a statement. That incredibly instinctive flick/pass to Chamakh just made me watch in awe. He plays very similar to the departed Fran Merida, and I am feeling a lot better now.

Alex Song was a master in midfield in the match and over the weekend against Bolton. The 2.5m signing from Bastia 4 years ago is showing the exactly why his move was made permanent after a loan. Possession wise he was just superb, it was exactly what you would have expected from a defensive midfield. Feeling better without Flamini, yea...

And also, Chamakh who continues his scoring streak. First goal by his foot? Haha, a stat there.Played in the CL last season and was in familiar territory. Showed his athletic abilities and his mould into to Arsenal style is almost in place.

Good start again this season...I'm not looking very far but I am expecting a lot more this season.

~deyao~

Miss Inspirational

I've been re-inspired again, all thanks to the extremely inspirational Marié Digby. She made a short "movie" named after her album Breathing Underwater. It was primarily to describe how she actually wrote her album, how the songs came about. I did remember her mentioning about the sequence of songs throughout the album and the way she presented it in the movie explains many unanswered questions. The videos are based on a true story and to be able to get an insight on this was a great feeling for a big fan like me. She may not be a big star in music but her songs has appealed to many people. Her songs has played a very huge role in my life over the past few years and it has become a part of me. Marié is one of the people I draw a lot of character and passion from and I am really glad her songs has made an impact like she intended to.

After watching the "movie" (made of 17 short videos), it reaffirms everything she has always tried put in her songs. Her drive and passion for music is remarkable. It is not a typical movie but just an illustration of her songs from the album. You get to experience her many acoustic versions of her songs which sound so much different from the original version. Overall, the videos also shows her difficulty during the start and also the people who exists in her songs. I forgot to mention the movie was directed by her too.


The best thing is the videos are absolutely free for streaming on the ABC website. Refer to the picture above for the sequence to make you don't skip any videos in between.

Go to this URL to check the movie out
http://abc.go.com/watch/clip/music-lounge/FK_lilith

The videos were released over the course of the Lilith tour which consists of only female artists. The tour is created for a good cause, Marié was a correspondent for the tour and she got to meet many big artists. She wrote about her experience on the website below.
http://forums.abc.go.com/abcontheroad

Although I haven't written about her in awhile, it is no indication I've lost touch. I'll most probably write about her again when she has new music or an album coming.

Some pictures to end.

♥

Jap look?

Not sure who are the rest
Marié's precious Misty.

♥♥ Marié
~deyao~

SUPER Albums on the way

Tomorrow marks the release of Katy Perry's "Teenage Dream" album. Her sophomore album is no doubt going be absolutely fabulous. Her first two singles of this album has already done wonders on the music charts. After a successful first album, this album is poised to hit greater heights.

Next is probably the one I have anticipated the longest. I've waited very patiently for this, about 3 years. She has top spot for the best album I've ever listened too. It's no other than the exceptional Sara Bareilles. Her first album just blew me away. From the lyrics, composition to arrangements for her live performances, it was just incredible really. It's her second headlining album titled Kaleidoscope Heart. Although her first single King of Anything has not quite done a "Katy Perry", this album is destined to be tremendous. It will be out on September 7.

And finally to cap it off, there's no better artist to do it. Competing in the ranks with Beyonce and Lady Gaga in the music scene, there's only one artist right up there. It's the very talented and beautiful Taylor Swift!! It's approaching 2 years since her release of the record-breaking album, Fearless. Fearless was a global phenomenon, selling countless number of albums worldwide. Her "Fearless" tour sold out in minutes in every venue. It would take a book to describe Taylor. Her impact on the music scene has been immense and she's transformed into one of the world's biggest artist. Her upcoming album is titled "Speak Now" and her first single "Mine" has already been on the airwaves. October 25th is the release date for her album.

It's really exciting especially as the albums are released so close to each other. Looking forward to some awesome music!

~deyao~

First Thoughts on the Opening Game

Arsenal had a big break last night. Rosicky could have scored at late but Arsenal could have conceded a penalty to Fernando Torres. Arsenal were favourites at the start but disappointed throughout the match. The fact that Arsenal didn't come out with enough desire to win showed. There was no urgency and no spark in the game.

It was an exciting line up to see. Chamakh, Koscielny and Wilshere all making their first starts for the club.Chamakh used his height to pressure Liverpool but he rarely troubled. He had relatively good touches on the ball and I have no doubt he'll do even better next week. Koscielny had a good start for a first match. Although Arsenal conceded, I think we could see he is up for the challenge. I was delighted to see Wilshere make the starting line up, but Mascherano and Gerrard kept him quiet. Another step to establishing himself into the first team I guess.

Notables. Nasri was influential in many of the plays, showed quick movement and passing. Stuffed up two good free kick attempts but looked more confident than ever. Eboue played good passing as well but never really threatened offensively. Rosicky made a good impact after he came on and almost scoring.

Room for improvement. Arshavin looked completely out of sorts for one of his favourite fixtures based his goal tally at Anfield. I am still not convinced with the crosses from the full backs Sagna and Clichy. Everytime there needs to be good ball in the box, the crosses were disappointing. Almunia should not have been beaten at his near post. He doesn't convince me that he is capable of being number 1.

Impact of Fabregas, van Persie and Song
Arsenal missed these three players yesterday. There was no direction in the flow of the game. Arsenal were passing their way to nowhere at times and it is not something they should be doing. Van Persie never quite settled in the game. Had Song played a part in the game, Arsenal would have held more possession and allow more attacking plays.

We couldn't afford to lose the first game of the season and we didn't. I am not sure about the fitness of the absentees but I would love to see more firepower next week. It's going to be against a Blackpool side who made headlines with their thrashing of Wigan. There definitely must an improvement to this result next week.

~deyao~

Fantasy Premier League

It's another year already...I could still remember writing this post for last year.
As usual I've created a league in in FPL. Feel free to join.
The league code is 660423-152905

The dateline is 14 August 1100 GMT so make sure you get your teams registered by then.

~deyao~

The season is starting

31 August represents a very important deadline for football clubs, it is the last day for clubs to sign new players or sell. It would be 4 months of non-activity after that. The new season of the Premier League starts again in less than 2 weeks!

It was quite a wonderful winter break with the World Cup starting the night of the last day of exams. I've watched many many matches and I couldn't be more pleased. Although I expected Spain to be contenders but I never wanted them to win. One of the reason is Spain being made of almost entirely of Barcelona players whom are pursuit of Fabregas. One way to see it is Barcelona are a tremendous team and even a player like Cesc may not make the starting line up. But you could see the impact Cesc has the moment he comes on, he is one hell of a player. He is intelligent, quick and his vision is top draw. There are countless reasons Barca would want Cesc but Barca too got realities of their own, finances. They didn't build a stadium or get taken over, but yet that pile of debt is so huge. They had to borrow 120 mil to pay their wages. Well, it is not a cheap team to maintain. Most of them are World Cup winners and they had Ronaldinho for some time and his wages would have been very close to 200k a week.

Football is a sport for entertainment and it is also a business. We have seen over the years many clubs run into financial trouble like Leeds, Newcastle and most recently Portsmouth. When you have trouble with your finances, it affects the business too. If the club goes into administration, points get deducted and the club is forced to sell top players, the end result won't be a good one. Arsenal is one of the most talked about teams when it comes to winning vs finances. Arsenal are arguably the most well run club financially in the world. But in contrary they have won nothing in the past 5 years. The interesting fact is, although winning nothing, the club's financial health is still that good. Here's a few reasons why.

Reason #5 Arsenal have not been taken over
Many of the clubs being taken over very very huge in asset base base but when compared to their debt, it is not a pretty sight. Man Utd might have a asset base of nearly 1 bil, but having debts of 700m which has increased since the takeover in 2005 has certainly got the fans very mad. Imagine the financing cost involved.
This article illustrates the not very pleasant situation.
http://www.goal.com/en/news/9/england/2010/05/28/1947511/exclusive-manchester-united-spent-40m-refinancing-debt-following-

There's a very big reason why many fans and the Red Knights desperate in getting the Glazers out the club.
Many people are wondering why a change of owners is a bad thing. Well don't the names of the shareholders just change ? Normally that's what happens. But not in this one. What the Glazers have done is a leveraged buyout in finance terms. What they have done is the borrowed a very large sum to acquire the club and at the same time use the club's assets to secure the loan. How does it benefit them? They don't have much upfront cost. Won't they lose as well with the huge financing bill? Number one, how much can they lose if they put so little capital in club. Number two, if it takes 50 years to pay off the debt, it won't matter, the business pays off the debt itself. Who loses? The club loses overall because finance will be tight and players need to be sold over time to fund huge loses. The exact same problem has occurred at Liverpool and that situation is much worse. For Chelsea, the debt levels are also pretty high but the Roman injects money in every season, making things look rosier than it is.

Reason #4 Low wage rates
I shouldn't actually be using the the word "low" because the wages are still pretty high. In general, Arsenal do not pay exorbitant wages to anyone. Anything above 100k is extraordinary. I believe only Cesc commands that level at the moment. The lack of big names also contributes to Arsenal's lower wage bill. However in recent article I've seen, it is not significantly lower. But a million or two a year goes a long way.

Reason #3 Youth
The most controversial policy I have seen adopted. It has shown glimmers of what the future has in store for the club but that has been all. Youth hasn't brought the silverware. But it has kept Arsenal out of the overpriced transfer market.

Reason #2 Stadium Revenue
The Emirates Stadium has been a curse in terms of trophies but financially it has been a great investment. Matchday revenues has been at record levels with season tickets in shortage. Accommodating 50% more spectators than Highbury, a club like Arsenal would need it. But Wenger's role in consistently delivering Champion's League football has been the main reason Arsenal could afford it.

Reason #1 Buying Cheap & Selling
When it comes to value seeking, Arsenal are champions. They have bought many players at a very cheap price and turning them into world beaters. Nothing at Arsenal cost more than 16 mil which was paid for Arshavin. A season of buying in Real Madrid is probably equivalent to more than 5 years of transfers in Arsenal.

The only way you could ever make money is selling. Although it sucks seeing players leave the club, the amount of money Arsenal has made over the years is quite amazing. Henry, Vieira, Adebayor, Anelka, Toure and a few others easily made the club over 50 mil. You don't usually see anything like this anywhere else.

The Transfer Market so far.....
The most aggressive team by far this summer has been Man City. They were extremely close to making 4th place last season. The big names they have got are David Silva, Jerome Boateng, Yaya Toure and very likely Mario Balotelli. It's over 100m spent so far. Mancini has only one chance to achieve a top 4 position and his signings has drawn a lot of attention. Are they going to be serious contenders? In the attacking part of the game, they've got oversupply of talent and I can really see no reason for more transfers. But their problem last season has been the defence. Although their defence is made up of quality players, somehow it was one of their biggest downfalls. Only Boateng has come to the picture in terms of the back four, has Mancini done enough? I think he needs one more.

The Big 3 (although Spurs are in the top 4, they still haven't deserved to knock Liverpool out) has done a great deal of transfers. Man Utd only adding Chris Smalling and Javier Hernandez. Despite the loss of Ronaldo, they had quite a decent season. This probably prompted Fergie to continue with his current squad. Despite their age, Giggs and Scholes has been admirable and extremely influential in the team. They surely will play a big role again this season, but Fergie has to know it won't last. Nani and Valencia have stepped up last season and this has most likely satisfied the manager's line up.

Chelsea has been really quiet, only big name has been Benayoun. No offense, but I am not sure Benayoun is good enough for the team. I don't see him lasting more than a season. I am really sorry. Overall I don't think the champions need any more players and all they could do is keep up the good work. They are close on signing Ramires recently but again I am not sure to what extent this Chelsea team is getting much better.

Arsenal has freshened up their squad. Letting under-performing and mediocre players leave during the summer. Campbell, Silvestre, Gallas, Senderos and Eduardo all departing. They haven't done the job up to a certain standards and I had no problems seeing them leave. My concern would be on the defence. Only one signing after 4 exits. Wenger needs another 2 defenders at least, they only have 3 centrebacks now. Ater conceding 4 goals against Barca and 3 against Wigan, Wenger has to know he has a massive gap to fill. The addition of Chamakh rules out any potential strikers. The return of Aaron Ramsey and Jack Wilshere would also rule out any potential midfielders. Overall I am still not convinced we got "our" man to score the goals. I would like to see another striker come in. If RVP is sidelined, Bendtner leads the front and that is no way going to create enough goals. I am still not quite satisfied with the sort of firepower to do a lot of damage when attacking, oh well, I can only hope. Wenger has to sign at least 2 players or the fans would go another season suffering. Oh man...

Forecast
I always got lots of predictions wrong. As much as I didn't want Spain to win the World Cup, I gave a genuine prediction they would make it. It's always a tough job for anyone to predict football. So many views and only a few will get it right. I am quite confident the top 3 last season will have no problems staying in the top 3. Top 4 is going to be a four way playoff this season. It is more open than ever. Man City, Liverpool, Spurs and Aston Villa. It would be against the odds but the knocking on the 3rd place door would take place this season. My biased but hopeful prediction for the top 4.
1. Arsenal
2. Chelsea
3. Man Utd
4. Man City

Neutral prediction
1.Chelsea
2. Arsenal
3.Man Utd
4.Man City

Risks
There are a few risk the predictions would go really wrong. I am not buying myself any insurance going with the winners year after year may not be realistic.
Goal scoring machines - Rooney and Drogba were top scorers last season and there will be heavy reliance on them again this season. Rooney had a slightly painful end to last season and a woeful WC, can he charge it up again?. Berbatov has to step for Man Utd with more goals, plus Nani and Valencia must notch up double figures in the league itself. Anelka,Lampard and Malouda must also keep up the scoring.

Integration - Man City's integration is really important. They got a host of talent in the squad but can Mancini make them a team? The predictions are heavily relying on this.

The fitness of Torres - His fitness hasn't be good enough over the past year .I see him scoring when he plays but this could be a tough season with the lack of talent in the team.

I'll leave it here and we'll see what the new season will bring . Till the next time. Ta!

~deyao~