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FReepers agree with Robert Reich:

3 Reasons Why The Wall Street Bailout Was A Failure

Eduardo Munoz/Reuters
Timothy Geithner’s new book about the financial crisis, “Stress Test,” is basically an argument that the Wall Street bailout succeeded.
That’s hardly surprising, given that Geithner was in charge of the bailout when Treasury Secretary (as was his predecessor at Treasury, Hank Paulson), and so has an inherit interest in telling the public it succeeded.

Even so, the bailout clearly did succeed, if success means avoiding another Great Depression.

But another Great Depression might have been avoided if the crisis had been handled differently — for example, by allowing the bankruptcy laws to do what they were intended to do, and forcing the big Wall Street banks to reorganize under them.

In fact, the bailout was a colossal failure in several respects Geithner barely mentions in his book, or avoids completely:

1. Bigger Than Ever ...

... and no sane person on or off the Street now believes Washington will ever allow them to fail – which means they’ll continue to make big, risky bets because they know they can’t fail. And they’ll get even bigger because big depositors and lenders know they’ll never fail and therefore demand lower interest rates than demanded from smaller banks.

2. No Wall Street executives have ever been prosecuted for what they did to the country ...

... which means even more rampant irresponsibility in executive suites as well as even deeper cynicism in the public about the political power of Wall Street.

3. The bailout helped the banks but did little or nothing for the tens of millions of Americans ....

... who lost billions of dollars in home equity and savings, and the millions more who lost their jobs. The toll was greatest on the poor and the middle class, who still haven’t recovered their losses, even though Wall Street has fully recovered (and then some). Nor have reforms been enacted that will help the middle class and the poor the next time Wall Street implodes.

So pardon me if I take issue with Tim Geithner. The bailout was a success in the narrowest terms. Seen more broadly it was a terrible failure.

We’d have done better had we forced the biggest Wall Street banks, including the giant insurer AIG, to reorganize under bankruptcy rather than bail them out.

GUNDLACH: We Could Be On The Verge Of ‘One Of The Biggest Short-Covering Scrambles Of All Time’

REUTERS/Eduardo Munoz
Jeffrey Gundlach, chief executive and chief investment officer of DoubleLine Capital
DoubleLine Funds’ Jeffrey Gundlach warns that we may be on the edge of a big bond market rally that could see yields tanking.
“If we go down [more] on Treasury yields, we will see one of the biggest short-covering scrambles of all time,” said Gundlach on Wednesday in San Diego. This quote is being reported by FA Mag’s Dan Jamieson from the Altegris Investments strategic investment conference.

Coming into 2014, almost no one predicted the 10-year Treasury yield would tumble to the levels we’re seeing today.

But bond fund manager Jeff Gundlach did.

During a public webcast on January 14 when the 10-year yield was at around 3.0% and when Wall Street said it would climb to 3.4%, Gundlach predicted that it could fall as low as 2.5% in the near-term.

Today, the 10-year yield fell through 2.5% and got as low as 2.4716%.

Gundlach isn’t the only one warning of a short squeeze in the bond market.

“10y short interest futures (CFTC) data showing a very crowded short,” said Stifel Nicolaus’ Dave Lutz. “The crowd is rarely right, and now the squeeze is on.”

Should things intensify, Gundlach’s already contrarian prediction may not have been contrarian enough.

“If for some reason someone has to cover these shorts, you could actually see the low yields of 2012 get taken out,” said Gundlach.

Now an economic report on....... bees....

New Report Warns That Bees Are Still Collapsing At An Economically Unsustainable Rate

REUTERS/Heinz-Peter Bader
Fewer honeybees died over the winter that just ended than in previous ones, although bees are still dying at a rate that is not economically sustainable, according to a new federal report published Thursday.
The new survey, issued by the U.S Department of Agriculture and the Bee Informed Partnership, found that nationwide losses of managed honeybee populations from all causes was down to 23.2%, a close to 7% drop from the winter before when death rates were at 30.5%. Over the past eight years, beekepers have reported average winter losses of 29.6%

That’s still no reason to celebrate. Beekeepers say that they lose money each year that losses exceed 18.9%, according to the USDA.

Honeybee die-offs have been blamed on a combination of factors, including pesticides, disease, parasites, poor nutrition, bad weather, and the stress of being trucked from orchard-to-orchard to pollinate different crops. Colony collapse disorder, a mysterious phenomenon in which bees vanish from their hives, may be triggered by one or a number of these pressures.

“Yearly fluctuations in the rate of losses like these only demonstrate how complicated the whole issue of honey bee heath has become,” Jeff Pettis, co-author of the survey and leader of the government’s bee research laboratory in Maryland.

The report comes on the heels of a Harvard study that found a strong link between the most widely used class of pesticides, neonicotinoids, and colony collapse disorder. Some scientists have dismissed the report, taking issue with the small sample size (only 18 colonies were tested) and noting that the pesticides used to treat the colonies were not administered to the bees in a way that would be found in nature.

Rather than targeting pesticides, the government report said one of the leading contributors to colony loss is the varroa mite, an Asian bee parasite that first arrived in United States in 1987.

“What is clear from all of our efforts is that varroa is a persistent and often unexpected problem,”Dennis vanEngelsdorp, director of the Bee Informed Partnership and an entomologist at the University of Maryland. “Every beekeeper needs to have an aggressive varroa management plan in place. Without one, they should not be surprised if they suffer large losses every other year or so.”

As ;Reuters notes, pesticide companies like Monsanto and Bayer pin the blame on mites, too, adding that “Monsanto-owned BeeLogics, a bee health company, is one of the collaborators in the partnership with USDA.”

The survey results are based on self-reported information from 7,200 beekeepers, who represent 21.7% of the country’s 2.6 million colonies.