Status Quo Plus One in MCA

Well the much awaited CC meeting in MCA has come and gone. As the President continues to lick his wounds of defeat, Vice President Liow ascended to deputyship, albeit by a simple majority vote. I guess, he may just be a temporary seat warmer.

Whatever happened to the guts of Kho Cho Ha is anybody's guess. Poor chap. He was seen as a potential take-over candidate. He seems to have given up.

So the status? No one is out of the woods as far MCA is concerned. The battle drags on.

After 5 hours of indecision at the CC Meeting, Ong Tee Keat had to invoke his presidential powers to call for another extraordinary general meeting (EGM) to decide whether the party should hold fresh elections.

These five hours of horsetrading showed a new pattern of support emerging. It appears that there are clearly three groups in the central committee. One, the Ong loyalists, then a splinter group of Ong's faction led by Liow Tiong Lai and finally Dr Chua's supporters.

As an imminent EGM looms, the party becomes more fractured than ever.

These may be early hours but Dr. Chua's group is not waiting to lose lead time. They have dug their heels in to ready themselves for this new EGM, much to the dismay of those who wanted to distribute the 'spoils of war' even before Tee Kiat can get out of his chair honourably.

Things may not be looking too good for Liow as he has been seen to be too impatient to move up from his current Vice Presidentship. His coterie of supporters are also seen as a treacherous lot!

The initiated knows that nothing new is going to come out of the new EGM. It will again be a stalemate of sorts as both Ong Tee Kiat and Dr. Chua cross swords again. It will be a Pyrrhic victory for whosoever wins as half the party will never be with him, heart and soul.

Desertion is on the cards as DAP and PKR awaits the eventual fall-out. It is theirs to gain and MCA, to lose big time.

Financialization...What a Word!

This is a very cynical article from James Pinkerton of Foxnews. It is about the bailout of Corporate America. It was written on the coat-tail of the Dow rising above the psychological 10,000 mark on 14 October 2009.

I append:

"So the Dow hits 10,000--great! President Obama should get some credit. But I suspect that others could have done the same thing, by following the same formula. For example, if I had borrowed,printed or otherwise conjured up more than $12 trillion, and pumped it mostly into the financial sector, I could have made something happen. What would happen? Most likely, Wall Street would start, uh, bubbling again, even as unemployment rose and the rest of the country languished.

Of course, as I sought to make my Wall Street medicine go down, smoothly, I would have to overlook a scandalously upward redistribution of income. Exhibit A in that upward wealth transfer: The nine biggest banks receiving $175 billion in bailout money, nevertheless paid their employees $32 billion in bonuses last year. That’s our money, into their pockets. Neither a muckraker, nor a Marxist, could ever find a purer example of the government serving as a tool of the ruling class.

But if the bailouts have their critics, they also have their defenders. Most of the political-intellectual establishment, which may or may not like Obama, nonetheless accepts the Bob Rubin-ite argument that “financialization” is inevitable and desirable--what’s good for Wall Street is good for America.

Well, we’re testing that proposition now, aren’t we?"

Bailouts speak for themselves. The effects however can be bitter!

Hitting the Magic 10,000

It finally did it! The Dow finally breached the psychological 10,000 points.

Associated Press contributed to the report below:

The Dow Jones industrial average closed above 10,000 on Wednesday (14 Oct), a testament to the stock market's powerful rebound from last year's financial crisis but also to a lost decade that has left many individual investors worse off than they were 10 years ago.

Strong third-quarter earnings from bellwether companies such as JP Morgan Chase and Co and Intel Corp, powered the powered the blue-chip index up 144.80 points, or 1.5 percent, to 10,015.86, the capstone to a furious seven-month rally driven by hope that the punishing global recession is slowly giving way.

The retaking of the 10,000 level marks an improbable turnaround from a brutal bear market, when the Dow plunged 54 percent from October 2007 through early March in the wake of a meltdown in the home-mortgage market, a crash in housing prices and the worst downturn since the Great Depression.

The recovery has been paced by aggressive government activity that alleviated fears of a global financial collapse and resulted in largely improving economic data. The speed and intensity of the rally has spurred fear that stocks are outrunning the still-weak economy and could fall hard again if the economy succumbs to a double-dip recession.

Others point out that the market has consistently defied naysayers and can hold its gains. "There's still room to keep going," said Phil Roth, a market analyst at brokerage house Miller Tabak & Co. "You have be careful how you play the rally, but it would be a bigger mistake to fight it."

Still, reclaiming 10,000 highlights the deep scars that many individual investors have suffered over the last decade and underscores the sharp divide today between the renewed prosperity of Wall Street and the still-deep struggles of Main Street.

The Dow first crossed 10,000 in March 1999 before the popping of the Internet-stock bubble prompted a bruising bear market early this decade.

The Dow is up a spectacular 53 percent from the 12-year low it reached in March, but it must rise 41 percent from its current level just to match its October 2007 record high.

"In 1999, we thought this was the beginning of a rocket ship riding to Dow 20,000," said Art Hogan of Jefferies & Co. "This time around, we're hitting it because we've moved away from the edge of the abyss."

Now, Wall Street giants such as JPMorgan and Goldman Sachs Group Inc are notching blockbuster profits.

Yet consumers are still grappling with rising unemployment, shattered home values and decimated 401(k) retirement accounts.

The economic recovery could be slower and generate fewer jobs than previous recoveries have, producing an even more pronounced gap between economic haves and have-nots, said economist Allen Sinai.

"There's a dramatic night-and-day juxtaposition of a booming stock market and rich financial firms, and jobless Americans," Sinai said. "Part of the prosperity we're seeing on Wall Street is because of massive job losses, which preserve profits" of American companies.

What a paradox- a preservation of profits at the expense of massive job losses.

Is this the new American Dream?