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Thing One: Wealthy, Meet Underside Of Bus: This has been a tough year for the wealthy.
First they blew hundreds of millions of dollars trying to un-elect President Obama because he had the gall not to ply them with the perfumed thank-you notes and autographed photos to which they had grown accustomed. Then Obama won reelection fairly handily on a campaign of raising taxes on them, the wealthy. And now, in their darkest hour, their time of greatest need, the wealthy are finding that the conservatives they had hoped would comfort them are instead tossing them under the bus. First there was Bill Kristol, who said on Sunday, yeah, sure, what the heck, raise taxes on the rich. And then Monday Glenn Hubbard, the conservative economist who was a top adviser to the wealthy Mitt Romney, penned an op-ed for the Financial Times in which he, too, said, yeah, we should go ahead and raise taxes on the wealthy.
Of course, Hubbard also stuck to the standard conservative line, that we should not raise marginal tax rates on the wealthy, but instead close loopholes and deductions and such. He also said we needed to raise taxes on those freeloaders, the poor, by adding a consumption tax. And he also called for slashing spending, including on Social Security and Medicare, by much, much more than we raise taxes. This is the sort of stuff Mitt Romney was campaigning for, and he lost the election, one week ago today, you may recall. Former Treasury Secretary Robert Rubin, writing in the op-ed pages of the New York Times, says the simpler approach is just to raise tax rates for the wealthy to where they were under his old boss, President Clinton. This is, again, the approach Obama called for in the election, and he won said election.
Still, some Democrats in Congress -- back in Washington for a lame-duck session -- are starting to come around the Hubbard/Romney idea of taxing the rich more by putting a cap on the amount of tax deductions they can take, the NYT writes. Obama has made a similar proposal before, the NYT notes. It could be the centerpiece of a deal to avoid the "fiscal cliff" of tax hikes and spending cuts due to take effect next year.
The risk is that this moment of kumbaya bipartisanship costs not just the rich but the millions of Americans who depend on Social Security and Medicare and other government programs. Liberals are gearing up to protect those programs, the Washington Post writes, even as business groups prepare to fight their own rear-guard action against higher taxes. All the while, two million Americans are set to lose their unemployment benefits at the end of the year, the WaPo notes. You don't hear quite as much talk about those people, do you?
If there's a silver lining to all of this, it's that the bond market is starting to price in a walk off the fiscal cliff, writes Bloomberg: Interest rates have plunged back to near-record lows.
Thing Two: Europe Can't Stop Disagreeing Over Greece: The Greek debt crisis is now three years old, and Europeans still can't stop fighting over what to do about it. Leaders of the European Union and the International Monetary Fund clashed publicly on Monday about how much time to give Greece to get its act together, Reuters writes. Their disagreement once again raises the risk that Greece will suffer a disorderly exit from the euro zone, setting all of our money on fire. Meanwhile, terrified European banks continue to keep mountains of cash parked at the European Central Bank instead of putting it to work to help the European economy, the Wall Street Journal writes.
Thing Three: Sandy Still Making People Miserable: Flood claims arising from Megastorm Sandy are threatening to overwhelm the U.S. government's flood-insurance program. Already in debt, the program could be asked to pay out $7 billion in claims, the New York Times writes. Meanwhile, though most of the region has returned to something akin to a normal life, there are still pockets of deep misery in New York City and along the Jersey Shore, where people still struggle without power and basic needs, the NYT writes.
Thing Four: Incredible Shrinking Wall Street: If the wealthy are having a hard year, the subset of the wealthy on Wall Street may have it especially tough. It, too, unsuccessfully spent millions to unseat Obama. And now it has to worry not only about higher taxes but also the possibility that it may not be able to pay itself quite as much in bonuses as in the past, Bloomberg writes. Guess the Mayans were right about apocalypse after all! Meanwhile, Goldman Sachs is going to anoint the smallest number of partners in a decade, the Wall Street Journal writes.
Thing Five: Bents Off The Hook: When it comes to holding people accountable for bad stuff that happened in the financial crisis, the U.S. government is the gang that could not shoot straight. It lost yet another case yesterday, this one against the Bent family, proprietors of the Reserve Primary Fund, a money market fund that "broke the buck" during the financial crisis, contributing to the broad market panic. Money market funds are supposed to be super-safe investments, but Reserve Primary loaded up on Lehman Brothers debt and had to be bailed out by the government. The SEC sued the Bents over the debacle, but lost in every important aspect of the case, the New York Times writes.
Thing Six: Another Insider Trading Case Begins: In contrast to the SEC's fumbling efforts to prosecute crisis-era cases, the Justice Department has been wildly successful in pursuing a broad-reaching insider-trading dragnet. A new trial opens today, in which a couple of former hedge-fund managers, Anthony Chiasson and Todd Newman, are accused of being part of an insider-trading conspiracy that included a trader at the massive, secretive hedge fund SAC Capital, run by the massive, secretive Steven Cohen.
Thing Seven: Windows Maker Thrown From Window: Just two weeks after rolling out Microsoft's latest Windows revamp, Windows 8, the guy in charge of Windows, Steven Sinofsky, has abruptly and unexpectedly left the company. Sinofsky was seen as a likely candidate to some day run the company that Bill Gates built, but is apparently a bit of a jerk, and the guy currently in charge of the company, Steve Ballmer, seems to be consolidating power, Reuters writes.
Thing Seven And One Half: Carl Spackler Was Doing It All Wrong: If you've ever played golf, then you know it's a game that is pretty much guaranteed to induce panic, which then throws you off your game, which then makes you panic even more and play even worse. That makes the story of Charlie Beljan even more amazing. This PGA player suffered a five-hour, 18-hole panic attack, with racing heartbeat, shortness of breath and everything -- and ended up winning his first-ever PGA Tour victory in the process.
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Calendar Du Jour:
Economic Data:
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Corporate Earnings:
Before Market: Home Depot
Heard On The Tweets:
Twitter is for the things I would be embarrassed to say to my wife but am somehow ok broadcasting them to thousands of strangers.
— Kumail Nanjiani (@kumailn) November 12, 2012
I don't know if you know this, but you're allowed to be in an airport and not complain about it on Twitter.
— Downtown Josh Brown (@ReformedBroker) November 12, 2012
"The key to this initial attraction was probably not sexual but rather biographical." Biographical attraction? Is that a thing?
— Heidi N. Moore (@moorehn) November 12, 2012
And you can follow me on Twitter, too: @markgongloff
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