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Here's an interesting take on the whole "Scotland" breakaway issue, and it directly bears on the United States as well.

We often hear that a state "can't" secede successfully, for the simple reason that the Federal Government controls too much of the economy and that if, say Texas, was to say "**** you" the result would be the immediate collapse of the Texan-cum-nation economy.

Not so fast, kemosabe.

There is a downside to massive debt accumulation by a sovereign and so-called "modern finance", and it is the rise of derivatives at gross multiples of the debt outstanding.

"Gross" means 10x, 100x, even 1000x the underlying actual amount of debt out.  And all of these derivatives have trigger events at which point they become payable.

Said "credit events" virtually always include a "reorganization" clause, which includes secession or partition of the underlying political entity.

So who's got the hammer?  It's not the Federal Government and most-importantly it does not matter whether or not the Federal Government recognizes the secession or whether they try to show up with guns and put it down.

No, rather it is the States that have said hammer, just as Scotland has said hammer.

The reason the UK is freaking out is because if Scotland secedes all of the derivatives on UK sovereign debt trigger, and while that may not sound all that awful since they haven't defaulted (yet) the protection evaporates and that triggering means that holders of said derivatives can force delivery on the derivative contract!

This also means that should any US State, or collection of States, decide to do the same thing the US Government's ability to deficit spend is likely to instantly end irrespective of whatever threats are made to send in the tanks.

This is not the 1800s and all the bleating about indivisible political unions is in fact about the drunken, addicted fashion that our nation (and England) have been intentionally destroying currency value via deficit spending.

Secession, whether ultimately put down by force of arms or not, instantly ends the ability to do that and that is more-frightening to these politicians than Satan himself appearing in the Capitol Rotunda.

It is well beyond the point where someone needs to call the US Federal Govermment's bluff -- the question is which state(s) have the balls to do it?

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Oh now this sounds like a good idea -- not:

A New Jersey father whose 12-year-old daughter was senselessly killed by a 15-year-old boy is suing the killer’s parents and pushing to enact a law that would punish parents of violent juveniles.

In October of 2012, 15-year-old Justin Robinson murdered 12-year-old Autumn Pasquale, who lived just 14 houses away, and dumped her body in a trash can.

Now, the girl’s father is suing Robinson’s parents and has started a movement to create “Autumn’s Law” to punish parents of violent juvenile offenders.

“Where were the parents?” asks Autumn’s dad, Anthony Pasquale. “Parenting comes with responsibilities, and one of those is to raise your kids right, to pay attention and know when they’re a danger to someone else. That’s a parent’s job.”

So what is a parent to do these days?

Said 15 year old is probably quite-capable of simply erecting the finger and walking out.  A parent who tries to physically prevent that is, under current law, charged with abuse.

This is really about trying to get someone -- anyone -- to pay, since trying the 15 year old for murder isn't enough.  No, we can't just cage someone (although they certainly deserve it!) and they have no money, and we're grieving and we deserve to be able to get something from someone.

Never mind that life isn't fair.

“If the minor who murdered my daughter was properly treated, parented, disciplined, and supervised my daughter would probably be alive today.”

And how does that happen if said minor doesn't want to be parented or disciplined?  You can't physically restrain or punish said kid any more; that's felony child abuse.

Never mind that said kid could deck you (as the parent) and there isn't **** you can do about it.  A "kid" willing to commit homicide would certainly be willing to punch your lights out -- yes?

The story on this sounds like a kid who's dad was a piece of ****; they got divorced after allegations of domestic abuse.  There's a psychologist who says the kid has multiple problems, but I'm not buying that crap.  Get me a forensic psychiatrist with a similar opinion and I might change my mind, but psychology is IMHO nothing more than snake oil and talking, and while the latter isn't a bad thing it sure as hell doesn't work when the target is actively evasive instead of wanting help.

“The law says broadly that I don’t owe my neighbors very much when taking care of my own children,” says Martin Guggenheim, a professor at NYU School of Law. “That’s the way it’s been forever. That’s the way it should be. The world is not better off if we impose on parents this extra fear of being made bankrupt or imprisoned because of their child’s misconduct.”

I agree -- especially in the namby-pants world we live in today, where any attempt to impose severe discipline for severe behavioral issues has good odds of resulting in you as a parent being prosecuted.

I know there are people who think corporal punishment is never appropriate, but I counter with the fact that there are people who understand only violence and the threat thereof.  ISIS head-cutters are one example -- admittedly an extreme example, but I only need one example for the point to be valid.

I'd love to latch on to and agree that it's the parents fault when something like this happens, but that clearly is not true.  We all know someone who had two or more kids and one turned out to be a five-alarm nightmare while the other or others were great.  Some turned their act around at some point but others do not. 

It is certainly true that some monsters are made, but I suspect just as many are born -- and it is manifestly unjust to hold someone accountable for a thing they no lawful means of addressing.

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It's simple -- it's the camera.

It sticks out from the back, rather than being flush.

Here's why that's important -- the front element can be damaged, and if it is, the camera becomes severely compromised.  This is not a warranty item and it is expensive to fix.

This is one of the "touch points" I pay very close attention to with phones, especially if I don't intend to case them.  With a case that's thick enough to stop any protrusion from being a protrusion it doesn't matter, but without that it's a huge problem.

Phones are frequently set down on flat surfaces, such as a table, a bar, a nightstand and similar.  It is very common for those surfaces to have extremely hard, small objects on them -- like sand, for instance.  If the camera protrudes it is quite a bit more-likely to take scratch damage from this encounter.  Incidentally the Galaxy S5 has the same issue, for the same reason.

This is a design trade-off that IMHO should not be made.  I know why Apple did it; as devices get thinner it gets much harder to get the camera you want to use to fit otherwise.  But in my view it is always a mistake and one that, if it's made and you still want the device, will pretty-much mandate that you also get a case and use it all the time -- which destroys the entire "make it very thin" premise that led the company to design it that way in the first place.

We'll see how this works out for Apple -- my money is on "poorly."

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The US House has just voted on Obama's proposal to train and arm "moderate" Syrian rebels.

You know what the definition of a rebel is, right?  One who is attempting to overthrow by force of arms the sitting government.

So now, into the breach we go again, arming people trying to shoot political leaders.  For real, not at the ballot box.

And we'll double-pinky-swear that none of this will go into the hands of the same groups that are cutting off the heads of journalists or threatening to blow up dams near cities.

We swear and we can be trusted, because we never lie about things like that, just like we didn't in Benghazi.


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In a word, meh:

For immediate release

Information received since the Federal Open Market Committee met in July suggests that economic activity is expanding at a moderate pace. On balance, labor market conditions improved somewhat further; however, the unemployment rate is little changed and a range of labor market indicators suggests that there remains significant underutilization of labor resources. Household spending appears to be rising moderately and business fixed investment is advancing, while the recovery in the housing sector remains slow. Fiscal policy is restraining economic growth, although the extent of restraint is diminishing. Inflation has been running below the Committee's longer-run objective. Longer-term inflation expectations have remained stable.

Uh huh.  In the meantime we're closing down (slowly) the debasement absorption that comes from deficit spending.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic activity will expand at a moderate pace, with labor market indicators and inflation moving toward levels the Committee judges consistent with its dual mandate. The Committee sees the risks to the outlook for economic activity and the labor market as nearly balanced and judges that the likelihood of inflation running persistently below 2 percent has diminished somewhat since early this year.

The Committee currently judges that there is sufficient underlying strength in the broader economy to support ongoing improvement in labor market conditions. In light of the cumulative progress toward maximum employment and the improvement in the outlook for labor market conditions since the inception of the current asset purchase program, the Committee decided to make a further measured reduction in the pace of its asset purchases. Beginning in October, the Committee will add to its holdings of agency mortgage-backed securities at a pace of $5 billion per month rather than $10 billion per month, and will add to its holdings of longer-term Treasury securities at a pace of $10 billion per month rather than $15 billion per month. The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. The Committee's sizable and still-increasing holdings of longer-term securities should maintain downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative, which in turn should promote a stronger economic recovery and help to ensure that inflation, over time, is at the rate most consistent with the Committee's dual mandate.

In other words the destruction of fixed-asset portfolios has to stop (exactly as I put forward originally.)

The Committee will closely monitor incoming information on economic and financial developments in coming months and will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability. If incoming information broadly supports the Committee's expectation of ongoing improvement in labor market conditions and inflation moving back toward its longer-run objective, the Committee will end its current program of asset purchases at its next meeting. However, asset purchases are not on a preset course, and the Committee's decisions about their pace will remain contingent on the Committee's outlook for the labor market and inflation as well as its assessment of the likely efficacy and costs of such purchases.

QE is finished.  (It won't return either.)

To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that a highly accommodative stance of monetary policy remains appropriate. In determining how long to maintain the current 0 to 1/4 percent target range for the federal funds rate, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial developments. The Committee continues to anticipate, based on its assessment of these factors, that it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends, especially if projected inflation continues to run below the Committee's 2 percent longer-run goal, and provided that longer-term inflation expectations remain well anchored.

When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent. The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.

Uh huh.

Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Lael Brainard; Stanley Fischer; Narayana Kocherlakota; Loretta J. Mester; Jerome H. Powell; and Daniel K. Tarullo. Voting against the action were Richard W. Fisher and Charles I. Plosser. President Fisher believed that the continued strengthening of the real economy, improved outlook for labor utilization and for general price stability, and continued signs of financial market excess, will likely warrant an earlier reduction in monetary accommodation than is suggested by the Committee's stated forward guidance. President Plosser objected to the guidance indicating that it likely will be appropriate to maintain the current target range for the federal funds rate for "a considerable time after the asset purchase program ends," because such language is time dependent and does not reflect the considerable economic progress that has been made toward the Committee's goals.

Big surprise.....

Oh, as the equities?  

They've been floating on the hot air, and that air is getting a bit on the rare side......

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