Eeyore's News and View

A casualty of what is happening with the economic meltdown is the toll it will take on the family.

6 die in family murder-suicide in Los Angeles October 7, 2008 - 6:01am
Los Angeles Police officers stand in front of the home where six bodies were found at a gated community in the San Fernando Valley neighborhood of Porter Ranch area of Los Angeles on Monday, Oct. 6, 2008. An unemployed accounting industry worker who was despondent over financial problems shot and killed his wife, three children, mother-in-law and then himself in an upscale home in a gated community, police said Monday. (AP Photo/Damian Dovarganes)
By CHRISTINA HOAG Associated Press Writer
LOS ANGELES (AP) - The only hints of trouble in the big beige house on Como Lane were the newspapers in the driveway and the lack of any activity behind the front door.
But when police summoned by worried friends of the residents got inside Monday, they found a horror _ six members of a family fatally shot in a murder-suicide committed by an unemployed man in financial crisis.
The body of 45-year-old Karthik Rajaram, a gun clutched in one hand, was found by officers who followed a trail of carnage through the home in a gated community in the Porter Ranch area of the San Fernando Valley.
His victims, most slain in their beds, were his wife, three sons and his mother-in-law.
"Absolute devastation," Deputy Chief Michel Moore told reporters outside the home.
Investigators quickly found two suicide letters and a will, and determined that the man once worked for a major accounting firm and was at least the part-owner of a financial holding company.
"The source of it appears to be a financial state, a crisis if you will, that this man became embroiled in that has unfolded over the past weeks," Moore said.
The man wrote in his suicide letter that he felt he had two options _ to just kill himself or to kill himself and his family _ and decided the second option was more honorable, Moore said.
The bodies were found when officers were sent to make a check on the home Monday morning after the wife failed to show up at a neighbor's home to go to work as a pharmacy bookkeeper, Moore said.
Officers found the mother-in-law, Indra Ramasesham, 69, dead in bed on the first floor. Upstairs, they found a 19-year-old son, Krishna Rajaram, dead in bed in the master bedroom.
The gunman's 39-year-old wife, Subasri, was found in another room, also apparently shot while sleeping, Moore said.
In an adjoining room, a 12-year-old son, Ganesha, was dead on the floor, and his 7-year-old brother, Arjuna, was dead in bed. Their father's body also was found there with a handgun "in his grasp," Moore said. The gun was purchased Sept. 16.
Coroner's assistant chief Ed Winter said the victims were shot multiple times.
The killings occurred some time between midnight Saturday and early Monday morning, Winter said.
The father had a business degree and formerly worked for PricewaterhouseCoopers and Sony Pictures, but had been unemployed for several months, Moore said. The deputy chief did not identify the financial holding company, though Nevada records show an incorporation there.
Moore did not specify what financial trouble the man had been in. He noted that the family did not own the home.
The man had no record of mental disabilities or contacts with mental health professionals in Los Angeles County, Moore said.
PricewaterhouseCoopers spokesman Steven Silber said Karthik Rajaram last worked for the company in 1999, but declined to offer any further information about him.
Sony Pictures Entertainment spokesman Steve Elzer did not immediately return a call seeking comment.
Karthik Rajaram is listed as a co-manager of a corporation called SKGL LLC, which is incorporated in Nevada, according to state records. He formed the corporation for his family's assets and used his family members' initials to form the name, said Las Vegas attorney Christopher R. Grobl.
SKGL was incorporated in 1999 and renewed its annual business license in December 2007. Grobl did not know what sort of business SKGL was or why Rajaram incorporated in Nevada.
Krishna Rajaram was enrolled at the University of California, Los Angeles, as a junior majoring in business economics, spokesman Phil Hampton said.
http://wtop.com/?nid=104&sid=1492072

This how Iceland solves it banking problems (or so they hope, article yesterday)
Iceland announces Russian loan, nationalizes bank October 7, 2008 - 8:13am
By JANE WARDELL AP Business Writer
REYKJAVIK, Iceland (AP) - Iceland nationalized its second-largest bank Tuesday under emergency legislation and said it had negotiated a 4 billion-euro ($5.4 billion) loan from Russia to shore up the nation's finances amid a full-blown financial crisis.
A Russian official, however, said a loan had not been agreed upon.
The bailout of Landsbanki came a day after trading in shares of major banks was suspended, the Icelandic krona lost a quarter of its value against the euro and the government rushed through emergency legislation giving it sweeping powers to deal with the financial meltdown.
"As declared by the government, all domestic deposits are fully guaranteed," the Financial Supervisory Authority said. "Landsbanki's domestic branches, call centers, cash machines (ATMs) and Internet operations will be open for business as usual."
Within hours of the government move, the Samson holding company, which held a 41 percent stake in Landsbanki, went to the district court seeking temporary protection from its creditors.
Iceland's central bank said in a statement that it had been informed by the Russian ambassador, Victor I. Tatarintsev, that Iceland would be given a loan of 4 billion euros ($5.4 billion), and that this had been confirmed by Prime Minister Vladimir Putin.
However, the Russian state news agency RIA-Novosti quoted Deputy Finance Minister Dmitry Pankin as saying there had been no formal approach from Iceland and no decision had been made.
A loan would support the Icelandic government's efforts to gain control of an increasingly dire financial situation, which saw it coming to rescue of the third-largest bank, Glitnir, only last week.
Prime Minister Geir H. Haarde warned late Monday that the heavy exposure of the tiny country's banking sector to the global financial turmoil raised the specter of "national bankruptcy."
Iceland is paying the price for an economic boom of recent years that saw its newly affluent companies go on an acquisition spree across Europe and its banking sector grow to dwarf the rest of the economy. Bank assets are nine times annual gross domestic product of 14 billion euros ($19 billion).
Investors are now punishing the whole country for the banking sector's heavy exposure to the global credit squeeze _ its currency has gone through the floor, imports have fallen and inflation is soaring.
"In the perilous situation which exists now on the world's financial markets, providing the banks with a secure life line poses a great risk for the Icelandic nation," Haarde said in a televised address to the nation. "There is a very real danger, fellow citizens, that the Icelandic economy, in the worst case, could be sucked with the banks into the whirlpool and the result could be national bankruptcy."
Just hours earlier, Haarde had said that no special measures were necessary _ but credit lines to banks then seized up amid speculation about the solvency of the country's major banks.
The new laws gave the Central Bank of Iceland and the Icelandic Financial Supervisory Authority detailed and vast authority to intervene in the control and operation of Icelandic financial institutions, including the ability to take over or create new institutions, call shareholder meetings and limit the authority of boards.
Earlier Monday, the Icelandic Financial Supervisory Authority suspended trading in financial instruments issued by Kaupthing, Landsbanki, Glitnir, Straumur-Burdaras, Exista and Spron.
The government also put 100 percent guarantees on savers' deposits, following in the footsteps of Ireland, Germany, Austria, Greece and Denmark.
A collapse of the Icelandic financial system could reverberate across Europe, given the heavy investment by Icelandic banks and companies across the continent.
One of the country's biggest companies, retailing investment group Baugur, owns or has stakes in dozens of major European retailers _ including enough to make it the largest private company in Britain, where it owns a handful of well-known stores such as the famous toy store Hamley's.
http://wtop.com/?nid=111&sid=1492426

With the election right around the corner, i hear this come up about every four years, so i figured i would post it, for you all. Does going to the polls really matter? How do i know, i vote every time i can, but i'm not a rapid voter for any candidate or party, i guess i should say. I vote regardless of party for the person, regardless.
Most of the candidates sway in certain directions because of party affiliation's, that is true, but not always. So you must know what they "say" they believe and try to figure out if they have enough principles to do what is right or at least what they think is right, regardless of what their party says.
No matter what you think, imo there are no statesman running. That is sad, all we have to choose between in the major parties, is politicians. That is what this Country has come to, that is part of the reason we are in the shape we are in. This Country has come to the idea that money is the most important thing, well it is not.
The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money. Alexis de Tocqueville
The sad thing is that we come to look at this day as normal and desirable. That is where this Country has gone wrong. The "pork" "ear marks"what ever you want to call them, is a manifestation of what has killed this Country. The Country as a whole lacks character, the Congress as a whole is totally bankrupt of it.
So vote, because it is your responsibility. But if you don't vote don't whine about the outcome.
If you are inclined not to vote because you think it doesn’t matter, consider this: One vote makes a difference. History proves that. Surfing the web I found a myriad of cases that showcase that very point.
In 1645, one vote gave Oliver Cromwell control of England.
In 1649, one vote literally cost King Charles I of England his head. The vote to behead him was 67 against and 68 for — the ax fell thanks to one vote.
In 1714, one vote placed King George I on the throne of England and restored the monarchy.
In 1776, one vote gave America the English language instead of German (at least according to folk lore.)
In 1800, the electoral college met in the respective states to cast their two votes for President. At that time, the U.S. Constitution provided the candidate receiving the most electoral votes would become President and the candidate receiving the second highest number of votes would become Vice President. When the results of the electoral college votes were opened by both houses of Congress, there was a tie vote for President between Thomas Jefferson and Aaron Burr. That threw the election of President into the House of Representatives where Thomas Jefferson was elected our third president by a one vote margin.
In 1824, none of the four Presidential candidates received an electoral majority. The election was again thrown into the House of Representatives, where John Quincy Adams defeated front runner Andrew Jackson by one vote to become the nation’s 6th president. Andrew Jackson received the majority of the nation’s popular vote.
In 1844, in the backwoods area of Switzerland County, Indiana on election day, a farmer named Freeman Clark lay seriously ill in bed. He begged his sons to carry him to the county seat so he could vote for David Kelso to become a state senator. David Kelso had defended old Freeman Clark on a murder charge and obtained his acquittal. The old farmer Freeman Clark got to vote for Kelso, but Clark died on his way back home. Kelso won the election by one vote. Both Freeman Clark and David Kelso were long-time Andrew Jackson supporters.
In 1844, when the new Indiana senate convened, Democrats had a majority of one counting David Kelso. At that time, state senates had the task of electing the state’s United States Senator. The Indiana Senate Democrats held a caucus where it developed a majority of the party delegation favored a man who would vote against the annexation of Texas if elected to the U.S. Senate. David Kelso refused to vote for the Democratic Party choice and a deadlock resulted between the Democratic and Whig candidates. This continued for days. Finally, Kelso made his move. He proposed a new candidate: Edward A. Hannigan. In his party caucus, Kelso notified his Democratic associates he would bolt and vote with the Whigs thus electing a Whig to the Senate - unless the Democrats supported Hannigan. The Democrats felt constrained to accept Hannigan who was then elected as Indiana’s U.S. Senator by one vote — that of David Kelso.
In 1845, Texas was admitted to the union as a state by one vote — that of Edward A. Hannigan from Indiana. The 1844 and 1845 excerpts on the series of single votes leading to Texas statehood are from the book Magnificent Destiny.
In 1846, a one vote margin in the U.S. Senate approved President Polk’s request for a Declaration of War against Mexico.
In 1850, California was admitted to the union by a margin of one vote.
In 1859, Oregon was admitted to the union by a margin of one vote.
In 1867, The Alaska Purchase was ratified by just one vote paving the way for the eventual admission of America’s largest state in 1958.
In 1868, one vote in the U.S. Senate saved President Andrew Johnson from impeachment.
In 1875, a one vote margin changed France from a monarchy to a republic.
In 1875, Florida’s U.S. Senators were still elected by the state legislature. Democrat Charles W. Jones of Pensacola was elected to the U.S. Senate by a majority of one vote.
In 1876, no presidential contender received a majority of electoral votes so the determination of the country’s president was again thrown into the U.S. House of Representatives. By a one vote margin, Rutherford B. Hayes became the new U.S. president. When Tilden’s party protested the tabulation and demanded a recount, Congress established a 15-member electoral commission to again count the electoral votes and declare the result. By an eight to seven margin - again, one vote — the commission affirmed the count and gave the election and presidency to Hayes.
In 1885, two members of the Florida House of Representatives waged a friendly but close contest for Speaker of the House. Robert W. Davis of Green Cove Springs defeated Gen. Ernest Yonge of Pensacola by one vote.
In 1889, by a one vote margin, Washington was admitted to statehood with the union.
In 1890, by a one vote margin, Idaho became a state.
In 1916, if presidential hopeful Charles E. Hughes had receive one additional vote in each of California’s precincts, he would have defeated President Woodrow Wilson’s re-election bid.
On November 8, 1923, members of the then recently — formed revolutionary political party met to elect a leader in a Munich, Germany beer hall. By a majority of one vote they chose an ex-soldier named Adolph Hitler to become the Nazi Party leader.
In 1940, the vote taken by the French parliament to maintain its status as a republic failed by a margin of one vote.
In 1941, the Selective Service Act (the draft) was saved by a one vote margin — just weeks before Pearl Harbor was attacked.
In 1948, a Texas convention voted for Lyndon B. Johnson over ex-Governor Coke Stevens in a contested Senatorial election. Lyndon Johnson because U.S. Senator by a one vote margin.
In 1948, if Thomas E. Dewey had gotten one vote more per precinct in Ohio and California, the presidential election would have been thrown into the U.S. House of Representatives where Dewey enjoyed more support than his rival — incumbent Harry Truman. As it was, Dewey was expected to win the general election by a landslide so most Republicans stayed home. Only 51.5 percent of the electorate voted. Truman defeated Dewey.
In a 1955 city election in Huron, Ohio, the mayor was elected to office by one vote.
In a 1959 city election, mayors of both Rose Creek and Odin, Minnesota were elected to their respective offices by one vote.
In the 1960 presidential election, an additional one vote per precinct in Illinois, Missouri, New Jersey, and Texas may have altered the course of America’s modern history by denying John F. Kennedy the presidency and placing Richard Nixon in the White House eight years earlier.
In 1962, the governors of Maine, Rhode Island, and North Dakota were all elected by a margin of one vote per precinct.
In 1984, a Monroe County, Florida commissioner was elected by one vote.
In 1994, the U.S. House of Representatives enacted a law banning specific classes of assault weapons. The vote was initially tied but one member changed his vote to approve the ban.
In 1995, bills proposing amendment to the U. S. Constitution required a 2/3 vote of each House in order to be approved. When the balanced budget amendment bill came before the U.S. Senate, the measure failed by one vote. Mark Hatfield, Republican from Oregon, was the sole Republican failing to vote with other members of the Republican Party, which was then the majority party of the U.S. Senate. When it became apparent the measure would fail, Senate Majority Leader Bob Dole changed his vote to enable him to bring.


Suspend Mark-To-Market Now!Newt Gingrich 09.29.08, 6:05 PM ET

On Monday, Congress voted against passing the bailout package for Wall Street. The stock market reacted immediately, falling almost 800 points. It is clear that something needs to be done, and in the coming days, a new package must be constructed that has the support of the American people that both deals with the liquidity crisis and sets the stage for long-term economic growth.
However, there is an immediate step that could be taken right now that would calm the markets and dramatically reduce taxpayer risk in any future government intervention.
Today the Treasury secretary released the following statement: "I and my colleagues at the Fed and the SEC continue to address the market challenges we are facing on a daily basis. I am committed to continuing to work with my fellow regulators to use all the tools available to protect our financial system and our economy."
While Congress and the White House consider next steps, the Treasury and its fellow regulators should follow their own counsel and take without delay the one regulatory action within their discretion that can help immediately to calm markets and dramatically reduce the taxpayer risk in any necessary government intervention: suspend mark-to-market.
Chief economist Brian S. Wesbury and his colleague Bob Stein at First Trust Portfolios of Chicago estimate the impact of the "mark-to-market" accounting rule on the current crisis as follows:
"It is true that the root of this crisis is bad mortgage loans, but probably 70% of the real crisis that we face today is caused by mark-to-market accounting in an illiquid market. What's most fascinating is that the Treasury is selling its plan as a way to put a bottom in mortgage pool prices, tipping its hat to the problem of mark-to-market accounting without acknowledging it. It is a real shame that there is so little discussion of this reality." (Emphasis added.)
If regulators on their own--or Congress, if regulators fail to use their discretion--can fix 70% of the financial crisis by changing the mark-to-market accounting rule, we should change the rule first before attempting to pass another reevaluated bailout package.
"Mark-to-Market" Accounting and the Origins of the Financial Crisis: Mark-to-market accounting (also known as "fair value" accounting) means that companies must value the assets on their balance sheets based on the latest market indicators of the price that those assets could be sold for immediately. Under such a rule, declining housing prices don't just reduce the value of defaulting mortgages. They reduce the value of all mortgages and all mortgage-related securities because the housing collateral protecting them is worth less.
Moreover, when a company in financial distress begins fire sales of its assets to raise capital to meet regulatory requirements, the market-bottom prices it sells out for become the new standard for the valuation of all similar securities held by other companies under mark-to-market. This has begun a downward death spiral for financial companies large and small.
More foreclosures and home auctions continue to depress housing prices, further reducing the value of all mortgage-related securities. As capital values decline, firms must scramble to maintain the capital required by regulation. When they try to sell assets to raise that capital, the market values of those assets are driven down further. Under mark-to-market, the company must then mark down the value of all of its assets even more.
The credit agencies see declining capital margins, so they downgrade the company's credit ratings. That makes borrowing to meet capital requirements more difficult. Declining capital and credit ratings cause the company's stock prices to decline.
Panic sets in, and no one wants to buy mortgage-related securities, which drives their value under mark-to-market regulations down toward zero. Balance sheets under mark-to-market suddenly start to show insolvency. This downward spiral shuts down lending to these companies, so they lose all liquidity (cash on hand) needed to keep company operations going. Stockholders--realizing that they will be wiped out if the companies go into bankruptcy or get taken over by the government--start panic selling, even when they know the underlying business of the company is fine.
The end result for the company is stock prices driven toward zero and bankruptcy or government takeover. The criminal liabilities imposed under Sarbanes-Oxley have driven accountants to stricter and stricter accounting evaluations and interpretations and have prevented leading executives from resisting them.

The Problems with Mark-to-Market Accounting: William Isaac, chairman of the FDIC in the 1980s under President Reagan, recently wrote in The Wall Street Journal, "During the 1980s, our underlying economic problems were far more serious than the economic problems we're facing this time around. ... It could have been much worse. The country's 10 largest banks were loaded up with Third World debt that was valued in the markets at cents on the dollar. If we had marked those loans to market prices, virtually every one of them would have been insolvent."
Isaac continues, "But what do we do when the already thin market for those assets freezes up, and only a handful of transactions occur at extremely depressed prices? ... The accounting profession, scarred by decades of costly litigation, just keeps marking down the assets as fast as it can."
He concludes, "This is contrary to everything we know about bank regulation. When there are temporary impairments of asset values, due to economic and marketplace events, regulators must give institutions an opportunity to survive the temporary impairment. Assets should not be marked to unrealistic fire sale prices. Regulators must evaluate the assets on the basis of their true economic value (a discounted cash flow analysis). If we had followed today's approach during the 1980s, we would have nationalized all of the major banks in the country, and thousands of additional banks and thrifts would have failed. I have little doubt that the country would have gone from a serious recession into a depression."
Similarly, University of Chicago Law Professor Richard Epstein, among the best in the country at law and economics analysis, recently wrote about mark-to-market accounting for today's mortgage-related securities, "Unfortunately, there is no working market to mark this paper down to. To meet their bond covenants and their capital requirements, these firms have to sell their paper at distress prices that don't reflect the upbeat fact that the anticipated income streams from this paper might well keep the firm afloat."
Alex Pollock, former head of the Federal Home Loan Bank of Chicago, explains that when the economy is in the midst of a severe downturn, the use of mark-to-market accounting "reinforces the downward cycle of panic-falling prices-losses-illiquidity-credit contraction-more panic-further falling prices-greater reported losses-no active markets. Fair value accounting adds momentum to a destructive downside overshoot."
Reform or Bust: Because existing rules requiring mark-to-market accounting are causing such turmoil on Wall Street, mark-to-market accounting should be suspended immediately so as to relieve the stress on banks and corporations. In the interim, we can use the economic value approach based on a discounted cash flow analysis of anticipated-income streams, as we did for decades before the new mark-to-market began to take hold. We can take the time to evaluate mark-to-market all over again. Perhaps a three-year rolling average to determine mark-to-market prices would be a workable permanent system.
It is not widely understood that the adoption of mark-to-market accounting rules is a major factor in the liquidity crisis which is leading companies to go bankrupt. But it is destructive to have artificial accounting rules ruin companies that would have otherwise survived under previous rules.
For companies like Bear Stearns, Lehman Brothers (nyse: LEH - news - people ) and American International Group (nyse: AIG - news - people ), suspending mark-to-market rules will come too late. But for the remaining vulnerable banks and corporations, doing away with the current mark-to-market accounting rules will safeguard against destructive pricing volatility, needless bankruptcies, job loss and huge taxpayer bailouts.
Suspending Mark-to-Market Only the First Step to Economic Recovery: In the wake of today's vote, suspending mark-to-market is an extremely important first step to take, but it is only a first step.
Congress should also consider a bold and dramatic program to restart economic growth and rebuild market efforts.
In particular, the Congress should look at the impact of the Irish 12% corporate income tax on attracting investment and jobs to Ireland and consider a dramatic cut in the U.S. corporate income tax (the highest in the world when combined with state taxes) as a step toward attracting high-value productive and desirable jobs back to the United States.
The Congress should look at the Chinese and Singapore growth patterns and match them by zeroing out the capital gains tax to induce massive flows of private capital to rebuild the market and minimize the need for a taxpayer-funded bailout.
The Congress should repeal Sarbanes-Oxley, which failed to warn of every single bankruptcy but provides a $3-million-a-year accounting and regulatory expense for every small company wishing to go public.
This is the kind of pro-growth, pro-entrepreneur program that would accelerate the American recovery and lead to the next economic period of real growth.
Former House Speaker Newt Gingrich is a senior fellow at the American Enterprise Institute (AEI). Emily Renwick is a research assistant at AEI and also contributed to this op-ed.
http://www.forbes.com/home/2008/09/29/mark-to-market-oped-cx_ng_0929gingrich.html


SEC gets power to suspend the mark-to-market accounting rule
By Matt Krantz, USA TODAY
A hotly contested accounting rule at the center of the financial crisis has reared up again in the bailout bill, but not in a way that will answer questions for months.
The bill gives the Securities and Exchange Commission the power to suspend the mark-to-market accounting rule.
This arcane accounting rule requires companies to write down the value of certain assets to their current market value — defined as the price that similar assets are fetching in an open market.
Some investors are blaming the mark-to-market rule for exacerbating the financial crisis.
When troubled banks and financial institutions sell securities at firesale prices, it forces healthier institutions to slash the value of their own comparable securities. Those write-downs may erode investor confidence and may force these firms to raise additional capital.
Supporters of mark-to-market accounting say what assets fetch in an open market is the only reliable measure of value. Not using these prices allows financial firms to arbitrarily set asset values, perhaps too high.
The bill gives more heft to guidance the SEC issued on mark-to-market accounting on Sept. 30, says Michael Bopp, partner at law firm Gibson, Dunn & Crutcher. The SEC said companies are not required to mark assets to values that result from thinly trading markets.
But the real effect of the bill won't be known for some time, Bopp says. The SEC is required to study mark-to-market accounting and its role in recent bank failures and deliver results in 90 days.
http://www.usatoday.com/money/companies/regulation/2008-10-03-bailout-sec-mark-to-market-rules_N.htm

Most people are worried about the health of the economy. But does the economy also affect your health?
Steve Legato for The New York Times
2008 The rising cost of prepared foods in the United States is forcing people to cook from scratch.
It does, but not always in ways you might expect. The data on how an economic downturn influences an individual’s health are surprisingly mixed.
It’s clear that long-term economic gains lead to improvements in a population’s overall health, in developing and industrialized societies alike.
But whether the current economic slump will take a toll on your own health depends, in part, on your health habits when times are good. And economic studies suggest that people tend not to take care of themselves in boom times — drinking too much (especially before driving), dining on fat-laden restaurant meals and skipping exercise and doctors’ appointments because of work-related time commitments.
“The value of time is higher during good economic times,” said Grant Miller, an assistant professor of medicine at Stanford. “So people work more and do less of the things that are good for them, like cooking at home and exercising; and people experience more stress due to the rigors of hard work during booms.”
Similar patterns have been seen in some developing nations. Dr. Miller, who is studying the effects of fluctuating coffee prices on health in Colombia, says that even though falling prices are bad for the economy, they appear to improve health and mortality rates. When prices are low, laborers have more time to care for their children.
“When coffee prices suddenly rise, people work harder on their coffee plots and spend less time doing things around the home, including things that are good for their children,” he said. “Because the things that matter most for infant and child health in rural Colombia aren’t expensive, but require a substantial amount of time — such as breast-feeding, bringing clean water from far away, taking your child to a distant health clinic for free vaccinations — infant and child mortality rates rise.”
In this country, a similar effect appeared in the Dust Bowl during the Great Depression, according to a 2007 paper by Dr. Miller and colleagues in The Proceedings of the National Academy of Sciences.
The data seem to contradict research in the 1970s suggesting that in hard times there are more deaths from heart disease, cirrhosis, suicide and homicide, as well as more admissions to mental hospitals. But those findings have not been replicated, and several economists have pointed out flaws in the research.
In May 2000, the Quarterly Journal of Economics published a surprising paper called “Are Recessions Good for Your Health?” by Christopher J. Ruhm, professor of economics at the University of North Carolina, Greensboro, based on an analysis measuring death rates and health behavior against economic shifts and jobless rates from 1972 to 1991.
Dr. Ruhm found that death rates declined sharply in the 1974 and 1982 recessions, and increased in the economic recovery of the 1980s. An increase of one percentage point in state unemployment rates correlated with a 0.5 percentage point decline in the death rate — or about 5 fewer deaths per 100,000 people. Over all, the death rate fell by more than 8 percent in the 20-year period of mostly economic decline, led by drops in heart disease and car crashes.
The economic downturn did appear to take a toll on factors having less to do with prevention and more to do with mental well-being and access to health care. For instance, cancer deaths rose 23 percent, and deaths from flu and pneumonia increased slightly. Suicides rose 2 percent, homicides 12 percent.
The issue that may matter most in an economic crisis is not related to jobs or income, but whether the slump widens the gap between rich and poor, and whether there is an adequate health safety net available to those who have lost their jobs and insurance.
During a decade of economic recession in Japan that began in the 1990s, people who were unemployed were twice as likely to be in poor health than those with secure jobs. During Peru’s severe economic crisis in the 1980s, infant mortality jumped 2.5 percentage points — about 17,000 more children who died as public health spending and social programs collapsed.
In August, researchers from the Free University of Amsterdam looked at health studies of twins in Denmark. They found that individuals born in a recession were at higher risk for heart problems later in life and lived, on average, 15 months less than those born under better conditions.
Gerard J. van den Berg, an economics professor who was a co-author of the study, said babies in poor households suffered the most in a recession, because their families lacked access to good health care. Poor economic conditions can also cause stress that may interfere with parent bonding and childhood development, he said.
He noted that other studies had found that recessions can benefit babies by giving their parents more time at home.
“This scenario may be relevant for well-to-do families where one of the parents loses a job and the other still brings in enough money,” he said. “But in a crisis where the family may have to incur huge housing-cost losses and the household income is insufficient for adequate nutrition and health care, the adverse effects of being born in a recession seem much more relevant.”
In this country, there are already signs of the economy’s effect on health. In May, the market research firm Information Resources reported that 53 percent of consumers said they were cooking from scratch more than they did just six months before — in part, no doubt, because of the rising cost of prepared foods. At the same time, health insurance costs are rising. With premiums and co-payments, the average employee with insurance pays nearly one-third of medical costs — about twice as much as four years ago, according to Paul H. Keckley, executive director of the Deloitte Center for Health Solutions.
In the United States, which unlike other industrialized nations lacks a national health plan, the looming recession may take a greater toll. About 46 million Americans lack health insurance, Dr. Keckley says, and even among the 179 million who have it, an estimated 1 in 7 would be bankrupted by a single health crisis.
The economic downturn “is not good news for the health care industry,” he said. “There may be slivers of positive, but I view this as sobering.”
http://www.nytimes.com/2008/10/07/health/07well.html?_r=3&8dpc&oref=slogin&oref=slogin&oref=slogin

McCain vs. Obama Game (Oct. 8) Americans believe that -- with hard work and a little luck -- anyone can become president. Assuming that we create our own luck, this free Miniclip game supplies the hard work, in the form of campaign staffers who will stop at nothing to push their candidate over the top and into the Oval Office. To play the McCain vs. Obama game, pick your candidate and choose three staffers. Your advisors include a devious operative (who looks a little like Karl Rove), a mudslinging spinmeister (who resembles James Carville), a hatchet man and a fundraiser. Staffers on both sides look exactly alike, because this game has nothing to do with ideology. It's all about winning.
http://www.miniclip.com/games/mccain-vs-obama/en/