Broke but we can still give it away

This Morning I han an email from Reality Check 4 Eve titled

This is what I am grumpy about today, and a line that read, "I hope you don't mind me borrowing your line Grumpy", followed by this link:

http://www.cnsnews.com/news/article/feds-plan-284-billion-loan-oil-refinery

No Reality Check, I don't mind you borrowing my line at all, I do mind the Our Government, borrowing money in our names to loan to State Owned Companies in other Countries to produce a product we need domestically and are capible of producing right here at home. 

The article U.S. Gov't Agency Plans $2.84 Billion Loan for Oil Refinery—In Colombia by Terence P. Jeffery started off like this.
 

CNSNews.com) - The U.S. Export-Import Bank, an independent agency of the federal government, is now planning a $2.84-billion loan for a massive project to expand and upgrade an oil refinery--in Cartagena, Colombia.

The money would go to Reficar, a wholly owned subsidiary of Ecopetrol, the Colombian national oil company.

This is part of a $5.18 billion refinery and upgrade project in Cartagena, Colombia supplying petroleum products to the domestic and export markets,” the Export-Import Bank said in a statement

.

I'm thinking Foreign Aid by any other name is still Foreign Aid.  Wasn't it just yesterday that Standard and Poors downgraded America Debt rating to Negative?  We borrow 40% of the everyday costs of our own government.  If we can't pay our own bills with our own money, were do we get the money to loan to other countries...

I figured the answer must be somewhere in the article, and it was, at least it was if you understand government logic.. I don't, but I found an explanation of sorts..

"The public-policy rationale for the $2.84 billion loan for the Colombian oil refinery project is the same as the rationale for all Export-Import Bank loans to foreign interests: to create jobs in the United States

“The transaction will help create or sustain over 15,000 American jobs for a total of four years,” says the bank’s statement about the loan.
Spokesman Cogan says the bank calculates the jobs created or sustained by a loan or loan guarantee by using a formula that estimates how much money spent buying U.S. exports in a particular industry it takes to create a job.

If the $2.84 billion loan to Reficar to expand and upgrade its Colombian refinery creates or sustains the 15,000 jobs in the United States that the bank believes it will create or sustain that would work out to $189,333 per job

If can be a big word. What if they don't import anything from the US?  

Something about the numbers struck me.  Yeah, let me see, off the top of my head you get 20,000 jobs at $50,000 per year, per billion..   Hmmm 2.84 Billion, thought so, damned if the math didn't work out perfectly 2.84 billion/15,000 job= 189,333 each or 47,000 per job.. if all goes as planned by the U.S. Export-Import Bank.  Exactly the same amount as the loan..   Looks like another government stimulus program.

 Presidents Stimulus Plan didn't work when he tried it here..  The Federal Reserve Quantitative Easing scheme didn't get the banks to loan money to US Firms.  Instead they invested in Treasuries.. Other Countries and Oil Future Speculation.   Meaning they got our money at .25% and loaned it back to us and out competitors at 3% or more.  Now we're going to offer foreign companies the exact amount of borrowed money government bureaucrats figure we might get back in wages and hope that works better

It's not like the oil companies are poverty stricken, if they want new gasoline refineries in other parts of the world, let them pay for them.  Then we could loan that 2.84 Billion, we have to borrow, to an American Company so they could build something here.  

Or maybe we don't loan it at all, that way we don't have to borrow it.

Is he stupid, or something else?

I know I used the the same video last week, and I apologize, but that video says a great deal about Obama.  First the surreal assumption that if you can't afford four dollar gas you can afford a fifty thousand dollar car.  Second the assumption that after 2008 Americans are stupid enough to believe that oil prices are controlled solely by supply and demand.

Telling us high prices then, or now. are the result of higher demand and strains on the supply side isn't total bullshit, but it's a close as you can get and still miss.  The civil war  and general unrest in the Mid East make a good excuse, but a 2% loss in supply doesn't cause a 30% increase in prices.  Today, just as in 2008 the hyper inflation in oil prices is more a result of speculation than anything else, except maybe the devaluation of the dollar that's occurred on Obama's watch. .

Total U.S. crude inventories rose 1.63 million barrels to 359.3 million last week, They were forecast to increase 1 million barrels.  The week before that they crude supplies increased by 2.9 million barrels, or 0.8 percent, to 355.7 million barrels,  0.4 percent above year-ago levels.   Analysts had expected an increase of 2.2 million barrels for the week ending March 25.

There is no shortage of supply, inventories are actually increasing, that only happens when supply exceeds demand.

I don't believe the President could possibly be unaware of the those numbers, so when he says it's a supply and demand issue, he's lying. 

I don't think anyone will be surprised to find out the biggest speculators are the same Wall Street Banks we bailed out through TARP and Quantitative Easing.  In fact three of the biggest offenders just happen to be Goldman Sachs, Morgan Stanley and Citi who combined received over Four Trillion Dollars in Bailout,  Quantitative Easing and almost Zero Interest Loans from the Federal Reserve.

Does the Obama Administration have the power to do anything about the speculation.. From Huffington Post, Oil Speculation Continues Unabated -- $5 Gas Next?

The job of assuring that our energy markets are fair actually falls not upon the FTC but upon the Commodity Futures Trading Commission (CFTC), but it's had little success to date at curbing oil speculation and slowing this latest run-up in price.

 And a little farther down in the article we get to this

. The Dodd-Frank Financial Reform bill, signed into law on July 21, 2010, mandated that the CFTC write rules for the oil markets designed to stop speculation from controlling prices on crude oil and gasoline and driving them to astronomical levels, as they did in 2008. The bill also demanded that these rules be in place and working by February of this year.


There's just one problem: Those rules haven't yet been written and approved.

It seems the the CFTC is having a problem writing a set of rules that make Goldman Sachs and Morgan Stanley happy.. So much for all the Administration's talk about cracking down on Wall Street. There might be a good reason for that.  Pay a visit to Opensecrects.org   Here's what 2008 looked like.

Goldman Sachs Party Contributions  Dems: $2,044,644  Repubs: $470,634
Candidates  Total: $3,862,314 Dems: $2,650,393  Repubs: $1,200,581

Citi Group. Party Contibutions   Dems: $1,161,725.  Repubs: $456,401
Candidates  Total: $4,420,809 Dems: $2,625,478  Repubs: $1,784,682


Morgan Stanley Canadidates
Total: $2,814,245 Dems: $1,625,786  Repubs: $1,174,194

It's no big secret that Obama favors higher gas prices so he can force his agenda on America.  .  It's also no big secret that George Soros contributed heavily to Obama's election, or, as you can see on this video  that Soros is heavily invested in Petrobras, Brazil's national oil company.  Paybacks a, uh un,  well you know.  I guess it no big f'ng deal if it's on the backs of the American People.  Let's not forget what he said when to went to Brazil to declare war on Libya.

The SOB's wouldn't do it again, would they?

The video I hope you just watched is from January 2009, for those of you who'll point out that it came from CBS, Bill O'Rielly did a similar segment for FOX.  It's pretty rare when both ends of the political spectrum come to the same conclusion.  I'm going to carry it a little farther, in 2009 oil prices started to increase shortly after the release of TARP II funds, within a few months the price of oil had climbed into the upper $40.00 dollar range and the banks were flush again.  The Stock Market hadn't gone back up, real estate was still going down the only thing that was up was the price of oil and the banks balance sheets.  In 2008 the experts spent the spring and summer telling us oil prices were the result of supply and demand.

We all know the the supply of oil from Libya are off the market, that represents about 2% of the supply.  The price of oil is up closer to 20%.  What isn't getting as much publicity is Saudi Arabia w\has increased production more than enough to cover the loss.  I don't know how much of the lost production we could make up ourselves if it wasn't for Obama's policies, that's a blog all by itself.

Now as in 2008 the experts are telling us demand is up and inventories are down..  After hearing that just a few years ago, I'm skeptical.  I am certain there are ways not to report all all inventory. that's why this article  Will Federal Regulators Crack Down on Oil Speculation? caught my eye this afternoon, I think the author, Christopher Hayes is streching things to try and make the Republican's fault, bit a great deal of he say's makes sense.

 “The most conservative thing that can be said right now [is that] this would be no time to dismiss the role that speculation plays,” says Greenberger. ” A moderate statement is that speculation is creating volatility that is aggravating the uncertainty in the market. If you start talking to industry people, they’re pulling their hair out. American Bakers Association is going bananas. They all believe that the markets are going screwy because of Wall Street.” A host of businesses and organizations from Virgin’s Richard Branson to Oxfam all make the same case.

What Hayes overlooks is the big banks that have easy access to almost zero interest Federal Reserve cash have also been big Obama Contributors.  Goldman Sach, Citi and Bank America to name a few.  Put on a more personal level. if you could borrow $100,000,000 million at zero interest, and make yourself between 3 and 5 million in a month for shuffling paper, wouldn't you do it?  Hayes tries to lay the blame on the Republicans with this paragraph

One way to attempt to constrain these volatile mini-bubbles is for the Commodities Futures Trading Commission to impose “position limits,” essentially limits on the size of the bets that speculators can make. The New Deal–era Commodities Exchange Act gives the CFTC power to curb “excessive speculation,” and the just-passed Dodd-Frank bill explicitly calls for the CFTC to promulgate position limits.


Not surprisingly, the big Wall Street banks like Goldman Sachs don’t want this, and the two Republican members of the commission don’t favor any position limits rules with real teeth. To his great credit, CFTC Chairman Gary Gensler (a former Goldman banker I was quite critical of when nominated to the position) has taken a strong leadership position in advocating strong limits, and Democratic commissioner Bart Chilton has been supportive as well. That leaves the deciding vote in the hands of Democratic Commissioner Michael Dunn, who’s expressed misgivings

The question in my mind is not so much about Micheal Dunn's misgivings...... but why Barack Obama who is seldom shy about sticking his nose into affairs that aren't his business, is not commenting about something that clearly is