Our back-pedalling PM

What can he mean? Kevin Rudd as Opposition Leader was quite happy to talk tough about state governments and his commitment to end the blame game when it came to improving the nation’s public hospital system. Without any ifs, buts or maybes the States would have 18 months to agree to needed reforms or a Labor government would hold a referendum to give the Commonwealth the power to take over.

Last night Prime Minister Kevin Rudd when questioned on the ABC’s excellent Q&A program where youths asked the questions, was in back-pedaling mode. Most importantly the word “mandate” has now replaced “referendum”. Goodness knows what that means but it seems that whatever the state governments agree or don’t agree to do there will be no referendum held in conjunction with the coming federal election.

The man is weak — all talk and no action.

All that northern snow so it must be colder right? Wrong. The satellite record so beloved of the climate change sceptics shows that this has indeed been a warmer year than last. All that snowfall over North America has to do with increased moisture in the air than the temperature.

Check out the site for yourself here. The temperature for 7 February this year is the one with the little white box around it

A more circumspect Age. The Melbourne Age is a little more circumspect this morning in discussing where the sharemarket is headed than it was on Sunday. As I mentioned here yesterday, The Sunday Age’s Richard Webb had stock experts saying “the good times are not far away” but for the daily’s Ian McIlwraith “even the experts cannot agree on whether the world’s jittery sharemarkets are having a hiccup or a heart attack.” I suppose there’s nothing like a newspaper having two bob each way.

For what it’s worth I bring you this further contribution — a graph from American financial planner Doug Short of dshort.com who comments: “This chart … shifts the point of alignment … to the bear bottom in the Oil Crisis and Tech Crash, the first major low in the 1929 Dow, and the March 9th closing low for our current Financial Crisis.”

As the chart illustrates, the S&P 500 lows in 1974 and 2002 marked the beginnings of sustained recoveries. The Dow low in 1929 failed 11 months later. You can have your own guess as to what it means.

And a gloomy prediction. As a one-time bookmaker I have learned to respect the opinion of knowledgeable people who back their opinion with their own hard-earned — believe me, there are such people as winning punters — so I am a little worried having read this morning of an $US8 billion bet against the European currency. That is what traders and hedge funds have bet on the Chicago Mercantile Exchange against the euro in amassing the biggest ever short position in the single currency on fears of a eurozone debt crisis.

The Financial Times of London comments that the build up of short positions suggests investors are losing confidence in the single currency’s ability to withstand any contagion from Greece’s budget problems to other European countries. The well-regarded Ambrose Evans-Pritchard in the London Daily Telegraph is even gloomier with his assessment. Under the headline “Greek Ouzo crisis escalates into global margin call as confidence ebbs” he writes how for the third time in 18 months the global financial system risks spinning out of control unless political leaders take immediate and radical action.

Forget about those sub-primes. They classify in the US them as prime jumbo loans — generally defined as being loans on pricey properties above certain conforming limits set by mortgage titans Freddie Mac and Fannie Mae – and now 9.6% of them are delinquent with payments above 60 days in arrears. The credit firm Fitch ratings reported overnight that the jumbo loan performance continued to weaken in January as serious delinquencies rose for the 32nd consecutive month. “The new year has brought no relief from declining jumbo loan performance,” said Managing Director Vincent Barberio. “The trend line for delinquencies indicates the 10% level could be reached as early as next month.”

Although prime jumbo loan delinquencies began to rise in the second quarter of 2007, they accelerated in 2009 nearly tripling over the course of the year. Florida saw the biggest monthly jump of the five states with the highest volume of jumbo loans outstanding. Prime jumbo RMBS 60+ days delinquencies for the five states that comprise approximately two-thirds of the loans in question are:

• California: 11.3%, up from 10.8% (44% share of the market);
• New York: 6.1%, up from 5.8% (7% share);
• Florida: 16.6%, up from 16% (6% share);
• Virginia: 5.6%, up from 5.4% (5% share);
• New Jersey: 7.4%, up from 7.1% (4% share).

Now this, please note, is not what is happening to the battling poor in the United States but to the middle classes of the richest country in the world. Economists may describe the global financial crisis as over but there are still plenty of consequences of it being felt.

Putting matters in hand. You need more than a telegenic guy with a teleprompter was the verdict the other day or Sarah Palin about what is needed to run a country. As the talk about the former Alaskan Governor running for the presidency continues to grow Americans were given a view of how she will do things. Appearing on a CNN interview program she forsook the teleprompter for writing a few notes on her hand which she looked at when asked a question;

See it here.

But you have to admit that the woman has a sense of humour. After critics started referring to her little bit of cheating she wrote a message to her Mom on her hand and made sure the TV cameras saw it.

Hi Mom