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Published Monday through Friday about 8 AM Central Time Except Holidays

 

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Long Beach Container Traffic Down 15.8%

The Shipping Collapse

This week has been quite a wild ride, hasn't it.  The Dow, which closed Friday at 8852.22 is up  401-points from last week's 8,451.19 close.  But is it really time to be wading back into stocks?  Not hardly...at least not for my account.  If you want to have fun, go for it. My outlook, based in part on the linguistics of www.halfpasthuman.com and partly on a read of the charts since 2000's high of the Dow, is for the Big Slide Down to get actually pick up speed as we head down toward what could be a panic low of 5,900 or so, before a modest bounce and then down even lower from there.

 

The PowersThatBe used this week to (here's a hip spin word for you:) 'recalibrate' expectations.  Not only was George Bush saying that results may take a little while, but the same came from Ben Bernanke and Hank Paulson as well...each starting to fess up to the notion that yeah, all that money for the Banksters might not work overnight.

 

Meantime, the AP reports that the "Fallout from financial crisis hammers housing" and Reuters says the fed's "Probe of Lehman collapse escalated: NYT"

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Despite the miserable performance of gold and silver this week, I tend to take such price movements as just what they are: Indications of paper prices. But not necessarily an indication of what's really going on in the marketplace now, or what is likely to happen in the immediate future.

 

For one thing, the Fed's plan with Treasury to flood liquidity into the system seems to be showing up in the latest M-1 money figures out with little notice on Thursday of this week.  If you flip over to the Fed's money stock measures report, H.6 it's called, and scroll down to Table 2, you can find that the four -week M-1 average has been  1,450-billion for the preliminary October 6 period - the most recent reported.

 

This compares with a four week average of 1,396.5-billion for the first full week in September.

 

That's a four week change of 3.83%...Why if that kind of thing were to keep up, we'd be staring at 57% inflation of the money supply.

 

It's here that I stop myself and wonder if that's not perhaps a bit misleading, because if true, that would mean there's massive inflation in the pipeline.  Is the change in 13-week averages a little more restrained?  Why, of course: 16% annualized.

 

I hope you see the point:  because the government is printing up paper like crazy (and $1.5-trillion plus or minus a burger is crazy) a rational person would expect to see huge discontinuities develop in the economy.

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The "GlobalEurope Anticipation Bulletin" which has a far better record of forecasting global economic conditions that say, the Fed, has issued a "Global systemic crisis Alert - Summer 2009:  U.S. government defaults on its debt."  Among the factors this report cites:

"• The recent upward trend of the US Dollar is a direct and temporary consequence of the collapse of stock markets

• Thanks to its recent « political baptism », the Euro becomes a credible « safe haven » value and therefore provides a « crisis » alternative to the US dollar

• The US public debt is now swelling uncontrollably

• The ongoing collapse of US real economy prevents from finding an alternative solution to the country's defaulting

• « Strong inflation or hyper-inflation in the US in 2009? », that is the only question. "

Unfortunately, my back-of-the-envelope on M-1 seems to support strong inflation in necessary goods while deflation of housing prices may continue to collapse.

 

The collapse of Iceland's economy has been a sort of junior case study in where the rest of the world seems likely to head.  Not only are shoppers there hoarding goods (like food) but the country's leadership is begging for financial assistance from countries like Denmark and Norway which have ponied up some bucks.

 

Although there was some talk earlier in the crisis that Russia would simply 'buy Iceland", in the intervening week or so, punctuated with Russian market halts, the Russians may have thought better of the idea such that this weekend we're reading how "Russia not yet ready to lend to Iceland."

 

We noted yesterday how "China Shipping Traffic may plunge as exports slow" but few people have likely figured out the personal  implications of this; the largest being the worst bummer of a Christmas ever as goods coming to the U.S. are starting to dry up.  A reader who's familiar with the docks in the Pacific Northwest reports anecdotally that most of the ships coming in from Asia in the past few weeks have been 'above their waterlines' - a far cry from what the boom in consumer goods has been like over the past few years.

 

No, this is not something I'm making up - it's NOT being widely reported in the MainStreamMedia, however, because about the worst thing that could happen to the economy would be for consumers to really (and I mean really) tighten down on spending. 

 

Fro example, the Port of Portland is out with September results and air freight is down 13.1 percent from year ago levels according to the Portland Business Journal.

 

No, I couldn't find a press release on the Port of Long Beach web site, which I guess explains why there's no MSM focus on it yet, but if you know where to go sniffing for the latest statistics, you'll see that loaded inbound Port of Long Beach container unit traffic is down 15.8% compared with year ago levels.

 

It doesn't take a rocket surgeon to figure out that if container traffi8c is down 15.8% that sales of foreign-made goods should decline by a proportionate amount and profits (remember those good days?) would likely drop farther and faster.

 

Given the economy, an even bigger year-on-year decline seems likely by the time October figures come out.

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Given the difficulties with letters of credit lately, odds seem good that you should be worried about the 'ultimate tipping point' in the U.S. economy.  Here's how it works:

 

Usually, in a 'normal recession' when you get an economic slowdown, prices come down, interest rates on new cars drop to zero (and maybe even a little cash back) and people begin to increase their spending.

 

The "tip" occurs when things get so bad that despite all the incentives out there in terms of zero percent loans and such, people just cut off all spending and try to save cash.  Once that happens, you've got a Global Depression.

 

I'm going to keep today's report short - I normally don't do a Saturday post, but the magnitude of this story is such that it should be on every MSM outlet in the country and, in case you haven't noticed, it's not.

 

No talking heads discussing the 'tipping point', no government policy to address it (other than give money to bankers and pray a lot).  So I'll just tell you that within the next week or two, as the market slide picks up speed to the downside, that maybe you'll see the stories forthcoming then about how global trade is collapsing.

 

Remember where you heard it first.  It's the only story worth reporting from an economic standpoint and I don't see anyone else putting the larger context on it.

 

The main investment decision I'm off pondering this weekend is "When's the right time to exit the few bucks in the Treasuries and get into something that will hold (or gain) value is the GEAB expectation of a U.S. dollar default firms up...

 

Oh, and working on the reindustrializing America piece for Peoplenomics subscribers...

 

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Coping: National Gullibility Contest Results

No, I didn't do it on purpose, but there was a mistake in yesterday's column where I decried the fellow with poor math skills and then turned around and made the same error myself.  At least I have an excuse - this column gets written while most folks (including me) are still asleep.

 

But, the math when you take 850-billion and divide it up among 200- million residents of the US (which is what would happen if we weren't giving it to Banksters) is not $450 each.  It's $4,500 each.

 

What's significant is that of the 42,000 readers who viewed this site yesterday, only a handful (5 to be exact, which is precisely on handful) wrote in to say "Gotcha!

 

I'm just chalking this up as further evidence that people by and large don't read critically and question everything coming into their heads.

 

Tough task, that; made ever more difficult by the huge amount of material that we're expected to absorb every day.

 

Still, interesting to the point of making note of it.  So not only was Friday another National Correct George Day, it now gets honorable mention as "National Gullibility Test Results Day".

 

How to Stop Conversation

So there we were - waking up to a typical married couple on weekends conversation.  Elaine had spent Friday afternoon doing some taping and mudding around a newly installed second door into the master bath so that future house guests won't have to transit a bedroom to use the head.  Did a nice job of it, but that brought up the subject of sanding between coats of mud.

"Remember that sanding screen we used to smooth up the guest bath wall so we could put up the mural?  We don't have any sanding screens on hand..."

The guest bath has a Mediterranean mural and I've been checking out a web site where we can get a large selection of other murals.  In the back of my mine, I have this idea of using a mural backdrop and building a room-sized diorama in the master bedroom.  If you click here, you can see the kinds of murals that are available....

 

These murals are generally huge...9 feet high and 12 feet wide is not uncommon, but as we discovered when doing the guest bath, the surface you put them on is best close to dead smooth.  And that's how we became experts at sanding drywall using one of those ShopVac add-on systems.

"Since we don't have sanding screen on hand, how about we take one of the spare belts for the belt sander in the shop and use it?" she wondered.

"Uh, no...that doesn't have holes in it like sanding screen, so that dust would get all over the place..."

"What would happen if we put holes in it?"

"You'd end up with a tuna salad sandwich."

"Ah what?"

"Well, maybe a fruit compote, if you put enough holes in it..."

 

That effectively ended the conversation.  Elaine dozed off, convinced I had completely taken leave of my senses, which when writing about the economy I've found to be the best possible starting point.  And in the silence that followed, I quickly filled up a coffee cup and headed for the office reminding myself to pass on the usefulness of absurdity.

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The technique - hyper absurdity we'll call it - has other applications as well.  Growing up in the central part of Seattle, a pretty rough area back in the day, is where I first heard how to use 'creative insanity' to cope with adversity.

 

A high school friend (a fellow geek from when that was not a compliment) found himself walking down a deserted street one evening about twilight and who should come around the corner but three of the meanest, toughest 'hoods you'd ever seen.  Swinging chains and just itching for a 'good' fight.

 

Unable to run, my friend did the smartest thing I'd heard of:  He lapsed into a religious frenzy.  He started shouting and wailing.  But his preachifying was tainted.  He'd spew utter nonsense, kneel down on the ground and spew forth a few words that made sense.  Then he walked up to a power pole and began carrying on an earnest conversation with it.  All the while pretending to be completely oblivious to the oncoming 'hoods.

 

Not sure what to make of the situation, the local 'hoods passed him by. He was making a lot of noise which might draw attention and besides, my friend was obviously crazy.

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Never forgotten the value of feigned insanity.  It's also a good mental exercise - seeing how far off point you can be...sort of like interrupting the 'logical flow' of whoever you're dealing with.

 

In a way, it's quite empowering.  People in positions of authority usually enjoy mental domination over their subjects or reports.  But, when confronted with someone who might be insane, they can't corral or contain the conversation and control evaporates.

 

So have some fun with it.  Properly done, it's like dropping a huge Zen Koan on people; their minds are momentarily 'locked up' by the logical discontinuity suddenly in their face.  which gives you, the student of the mental martial arts, a moment from which advantage may be seized.

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Not to offend the great Haiku masters, such as Matsuo Bashō, but I've always found Haiku to be useful to still the mind.

 

Reworking Bashō's "old pond" from:

old pond

a frog jumps

the sound of water

To something that tries to 'short-out the logical brain/monkey mind" can provide hours of use:

old pond

a frog jumps

PERL script subroutines

Presented with a logical non sequitor (it does not follow) like this can be quite liberating and enjoyable.  Especially when you're able listen to a boring meeting in the conference room and insert your own absurdities into the proceedings.  Quite refreshing.

 

But wait! Which is the absurd?  The conference room meeting or...

 

Finding God Where?

Some stories, like the one headlined "Finding God at a beer festival" just grab the attention on a quiet Saturday morning.  How does this work?  Perhaps it's a story about drinking beer religiously? 

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What Thomas W. Lamont Talked About In 1930

Now that the "Greater Depression" may actually be at hand, you could be excused for wondering "Who is Thomas W. Lamont and why is George quoting a presentation he made on November 14, 1930 before the Academy of Political Science?"  I think it's really important stuff right now.  Here's a hint why  - check out the date on Time Magazine's cover for Nov. 11, 1929:

 

 

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Review of this week's report:

"Dear George, Inspired by today's bulletin, I looked at the business section of the NY Times, and read on page 6 Why the Bear Is Alive and Well. The writer, Paul J. Lim, talked about P/E ratios, and I felt very smug, having been made hip to them by your writing. The reporter seems to confirm what you've been saying, which shouldn't come in as a surprise. It's just interesting to see something about what I just read from you."

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"Live on $10,000" Updated

What?  You haven't ordered the ebook "How to Live on $10,000 a year -- or less"?  Suit yourself.  We're all going to live it shortly, anyway.  I just thought you might like a heads up by reading about how to do it before you get pink-slipped.  But, suit yourself OR visit www.liveontenthousand.com.  Yep - still possible.  I also took a bit of additional material that was pertinent from recent issues of Peoplenomics and included them.  The whole thing runs about 65 pages, but it gives you a vision of how to not only live on the aforementioned dollar amount, but also how to migrate up the economic foodchain if you make a little more than that and do some active savings...  Click here for the page with more details on it.

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Last week's report is here.    For back issues of this site, click here.  (Goes back to 1997!)

 

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Friday October 17, 2008

What was THAT all about?

Several readers have written in asking (variously) "What was the reason for gold's drop this week?" and "What's with the odd market behavior including yesterday's 400-point rally?"

 

Easy!  It's option expiration week craziness.

 

The reason for the rally yesterday was that index options (like the S&P options) expired at last night's closing prices.  And today, the rest of some 80-million options will expire on underlying common stock.

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Gold meantime has been falling toward one month lows as investors are trying to raise cash; no doubt some of that will be  used to pay off Lehman-related instruments which come due on it's either the 21st or 24th....24th I think it is.

 

If gold had been tracking the Dow since its high of 14,168, and Gold's $1,020 or so, Gold should be around $635...and no, George is not selling his gold coin.

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As OPEC is meeting shortly to discuss cutting output, I notice that the percentage decline in Silver seems to be similar to the decline in oil.

 

Again, I'm not buying or selling; we just sit back and watch the gyrations with our $210 dollars of life savings spread between a gold coin, a silver coin, a bit of cash, and savings bonds in the TreasuryDirect account.  I could give a toot about making money.  We're living through a period that screams "Capital preservation!!!"

 

Don't know if you saw it this week, but U.S. money market funds saw a net inflow of almost $60 billion last week according to iMoneyNet.

 

The very real problem that many investors have it figuring out where to put money in 401-K programs and such.  Since the Dow hasn't been doing so hot (cue the large sucking sound  from off-stage left) people are trying to find a temporary parking place.

 

Next: The Shipping Plunge

I don't recall if I mentioned that a source in China had told us about week back that China had shipping stacked up several miles out to sea with nothing to do, no cargoes to load, and hence they were just swinging at anchor waiting for work? 

 

No worries -- that particular story is staring to go mainstream as Bloomberg headlined today that "China's shipping traffic may plunge as exports slow..." 

 

I've been saying this for a good long time - a couple of years in fact -- If you need something that's not Made in the U.S.A. it might be a good idea to get it while you can.

 

We're walking the talk:  Elaine's just gotten a brand news stainless steel refrigerator.  Why?  The old one - about 20-years old, was on its last legs and with a shortage of repair parts, it was just time to replace it.  But, more important to me was the notion that if we waited - until maybe next spring - there might not be a refrigerator for the having and almost certainly not with the kind of choices that are available today.

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Doing a 'max zoom-out" it looks to me, based on the report this week that "August business inventories rise, sales plunge" that we're going to see a mini "boom & bust" in consumer goods.  The short term will see constrained prices because big companies will be trying to manage their inventory levels down, and then the breadth of choices will come down as inventory levels drop.

 

Since shipping is already dropping (first story) and consumers are pulling in their horns (second story) I can only assume that one of our best uses of any extra cash would be to get the kind of items that would be hard to find once the U.S. dollar begins to reverse after its gains of the past x months.

 

Did you see the report a week or so back that "Brazil, Argentina Abandon U.S. Dollar"?

 

Once that happens, the flow of foreign goods won't be coming back on quickly because I expect in a year's time for prices to be much higher than they are now.  And, with the fate of dollars in any kind of paper instrument being akin to Russian Roulette, we figured might as well get the major purchases we need while they're available.

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Related Item:

The Treasury Department's TIC Flow was about even for August. That's the Treasury International Capital data. Official outflows were negative almost $4-billion, though - first time in a while for that.

 

Making the Rounds

...Our spies down on Wall Street report this email going around about the economic decline in the markets:

"This decline is worse than a divorce:  I've lost half my net worth and I'm still married..."

The Runs:  Ugly Election Forms

The latest Gallup Poll shows it's virtually neck & neck between John McCain and Barack Obama.

The minor difference is likely within the poll's margin of error.

 

So, what does it mean?  For a long time the predictive linguistic work at www.halfpasthuman.com has been saying that the election outcome won't be known until January or even later.  And this current close polls, coupled with the FBI looking into the ACORN voter registration scandal, sets up a 'perfect storm' wherein the largely Bush appointed Supreme Court could be deciding the Presidency.

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Congrats to Glen Beck for pointing out that ACORN is funded (in part) by Fannie Mae.  And, since we voters are being so generous with Fannie lately, some republicans are demanding that ACORN funding via a mandatory line item in housing loans be eliminated.

 

This all seems absurd, until you think about it:  What would be more interesting here on Ant Farm Earth than to have the ants unable to elect a leader?  Gosh, next thing you know those "Obama isn't eligible stories will pop up and Hillary Clinton will be installed at the last minute...wouldn't that be a hoot?  Seems to me that nothing is impossible in this climate.

 

Joe The Plumber He Ain't

So, McCain's Joe the Plumber is reported not a licensed plumber, is reported to have tax issues and the rest of the sordid details are here.   If you're an unemployed HR Director, you know where you need to send your resume, right?

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Meantime, the recent McCain "Troops to Teachers" remarks are being  massaged around this way and that to spin up people's emotions.  But, when you look around, you'll find Troops to Teachers is an existing program in states like West Virginia....  Still, the waiving credentialing discussions are dangerous as I see it.  Is the response of America to a need for more teachers to be a lowering of standards?  Credential requirements have a purpose...  But wait! I guess this comes around to "If you're an un employed HR Director..." too...

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Can someone tell me again why we have an electoral college?  I mean isn't direct popular vote enough?  LOL...what an ant farm, huh?

 

If the election goes to the High Court, McCain wins, as best I can tell...popular vote be damned.  Again...

 

Terrorism: In B.C.?

A second gas pipeline bombing in a week has the Mounties looking for the perp(s) up in Northeast British Columbia, eh?

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Also in B.C.: Diesel shortages reported, eh?

 

The Wars

Another what seems like U.S. drone attack inside of Pakistan  has killed five.  Pakistan has drawn a much harder stance toward the U.S. since president Musharraf was bounced in mid-August.

 

Economic Woes - for Iran

Just like the West, Iran is having economic problems and the man at the top is getting his comeuppance/just desserts.

 

 

Big Trouble on West Caicos

What happens when the international banking system begins to collapse and there are 15 Israeli project managers and 300 Chinese laborers on a small island in the Turks and Caicos group (south of the Bahamas, north of Puerto Plata in the Dominican Republic, if you've never gone island hopping there...)?

 

You get a very strange labor dispute on West Caicos Island...

 

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Coping: George Corrected

"George, it is not a big enough item to rate mentioning and it's a low probability event...so tell folks to forget you even mentioned 10XCSN, OK?" 

Oh-oh.  Didn't like the sound of that...Unhappy Chief Time Monk.

 

"But...I was trying to put out a temporal marker and sure, it's only a tiny event...but distinctive...and besides I didn't think it would hurt..."  I do defensive well, thank you.

"Think?  Hurt?  Ha!  A minor a earth/social event. Probably won't even happen.  Your mere mention makes people think it's the end of the world.  It's tiny... If you want to put temporal markers out there, do something that big and happening soon enough - like the 'things go badly for American expatriates"...that one is going big and coming really fast...should peak in about two months and then fade off into late February."

"All the expats sent home?"

"Dollar collapse means 'Ugly American' label's more like it.  By March the issue fades under the other bigger items which will impact by March-April, most likely."

Made a note to send the time monks a follow-up email in a few days.

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So started "National Correct George  Day" on Thursday.

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Next up was a voicemail from a friend distraught about my health care discussion where I mentioned the government not being able to run a whorehouse in Nevada when it was seized a few years back.

"George...part of the reason that it failed under government management was because government actually paid taxes on their sales - no wonder they failed.    You do your readers a great disservice when you leave that part out..."

I recognized the voice...but won't say who it was...but by now I was wondering "How does he know all this...?"  The call continued...

"Furthermore, in a government run program, about 98% of the money spent on healthcare goes to the healthcare provider.  In a private run system, there's 29% that gets eat up by overhead...so youi tell me, what's more efficient?"

Hmmm...Made a note to send that caller a private email about that one...Double-underlined the part where I scribbled “should I ask how he knew about the sales tax?”

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Back to emails:

 

Seems people in the Big Apple love their Mayor Mike and are willing to change laws for him - or least some are...

"George,

I agree with you your stance on term limits, but not in this instance. Bloomberg is the perfect mayor in this time of crisis. He for saw a lot of this and was smart enough to put some money away while the city had budget surpluses instead of squandering it on bs. There is so much more bad news to come that it makes my hair hurt to even think about it. He is beholding to no one, and will do what ever is necessary to help pull the city through the disaster that lies ahead."

Made a note to send that reader a note explaining that it's not Mayor Mike that I have so much of an issue with as the next guy who comes along and who might not be as integrious...

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By this point in National Correct George Day I had accumulated a fair number of notes to tack on to an already too long 'to-do' list.  They joined an impressive pile from previous National Correct George Days, which best I can figure happened this week on Sunday, Monday, Tuesday, and Wednesday before Thursday started up. 

 

"Just like the previous weeks, too..." I thought, eyeing a stack of other notes large enough to constitute a fire hazard...

 

Hmmm...how to handle them all?  Aha!  Out to trash barrel. 

 

Made a fine fire.  Gave a lecture to Zeus the Cat while they burned on how to be an effective executive. 

 

Slipping Past Your Barriers

Curious to watch is how the masters of spin and persuasion are working overtime in the run-up to the election here shortly; all kinds of memeering (thought virus) material is flying around the 'net with the sole purpose of changing how people think.

 

The technique involves putting out an untrue story of a special sort -- the sort that's got just enough believability to it to be swallowed hook, line, and sinker.

 

Take for example the email which landed in my box yesterday that begins and attack on Barack Obama this way...

"From Sunday's Televised "Meet the Press" Senator Obama was asked about his stance on the American Flag. Obama Explains National Anthem Stance

Sun, 07 Sept. 2008 11:48:04 EST, General Bill Ginn' USAF (ret.) asked Obama to explain why he doesn't follow protocol when the National Anthem is played.

The General also stated to the Senator that according to the United States Code,

Title 36, Chapter 10, Sec. 171... During rendition of the national anthem when the flag is displayed, all present except those in uniform are expected to stand at attention facing the flag with the right hand over the heart. At the very least, "Stand and Face It"

The distro list on this email was huge, so I felt compelled to send back a note suggesting that everyone involved was either victims, fools, or both, for failing to his Snopes/Urban Legends and find this with almost no effect: It's a lie spread by presumably anti-Obama types.

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Just a couple of days earlier, an email from a reader up Idaho way landed.  It went to the idea that the Regular Army had seized all the arms from a local National Guard unit:

"...Eight days ago the National Guard Armory in Pocatello, Idaho was seized by the U.S. regular Army and stripped of all weaponry These guys are the 148th Field Artillery Battalion They stripped it of all weaponry and ammo...."

The email went on, in the best of conspiratorial tones, to imply that the regular Army had something planned for the country and the Nat. Guard wasn't going to be 'part of it'.

 

Having, as I do, a fair number of 'friends in green' we got right on this one.  could it be?  An unofficial back channel in the Idaho NG got a kick out of it...

"We thought it was pretty entertaining. The armory is under remodel and some material has been transferred to other armories for security during this time."

Aha!  But you see how these work, right?  If not, one more example should make it clear.

 

This one goes back about two weeks - at the time of the bailout bill.  This email went to the idea that if we took the bailout money that was being considered for the Banksters, and divided it by the 200-million (or so) adults over 18 in the U.S.A., each adult could get $425,000 each for that amount of money.

 

This email went gang busters and last I had checked had started to go viral.

 

There's only one little problem with it - the math's wrong.  The real amount for each American adult worked out to a mere $425.00.  The perp of this email obviously needs to return to sixth grade for the gaping hole in their education.

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The key thing in all of these can be summed up this way:

• They arrive as emails.

• They purport something that's not true

• They get swallowed hook, line, and sinker because they have some shred of truth.

 

These email memes are different from the 'memeering' that Cliff and Igor have found in various internet forums.  In the really big social-engineering memes, you'll often find a post that begins with some heading that's deliberately inflammatory, or has a high "must read on" factor.  A post like "How would you like your daughter to marry a gay..." or some question like that, which then continues into three paragraphs that are designed to set you up for a spin, are one way memeering is done.

 

But, so too, email memeering is done.

 

It's all part of using your subconscious to someone else's advantage.  Just like 'product placement' is a fine art in the world of film, so too, memeering is coming into its own as a high art on the net.

 

Since elections are close, and it would be reasonable to expect one last round of e-mudding between now and election day, I just wanted to pass on that conscious barriers to entry are a fine thing; it's the danger at the preconscious level that most folks don't study enough.

 

Peaceful Change?

A reader offers this 'revolutionary' thought:

Hi George,

I think it is time for "We the People" to enlist our military to take back our country from our so called "representatives". Maybe someone will take us seriously if they knew they had the backing of the public. Without the military we don't have a gnat's chance to save ourselves.

Here is the link to make the request:   ( Link to DoD form...)

And here is the request that I sent:

"Dear military leaders,

Our elected representatives are no longer representing "We the People". They are and have been for a very long time in bed with the very people they are supposed to be protecting us from. It is time to get back to our original Constitution.

I am only one old man who has no power and no authority. Our voting does no good.

I want my America back.

What are you going to do about it??????"

Let us know when the guys with the suits show up for a chat...I'll just keep voting "No incumbents and none of the above".

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Thursday October 16, 2008

Consumer Prices Flattish

Latest consumer price report is out - and another chance to compare what the Labor Department has collected with what your first-hand experiences shopping are...

"The Consumer Price Index for All Urban Consumers (CPI-U) decreased 0.1 percent in September, before seasonal adjustment, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. The September level of 218.783 (1982-84=100) was 4.9 percent higher than in September 2007.

The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) decreased 0.1 percent in September, prior to seasonal adjustment. The September level of 214.935 (1982-84=100) was 5.4 percent higher than in September 2007.

The Chained Consumer Price Index for All Urban Consumers (C-CPI-U) decreased 0.1 percent in September on a not seasonally adjusted basis. The September level of 125.774 (December 1999=100) was 4.3 percent higher than in September 2007. Please note that the indexes for the post-2006 period are subject to revision.

CPI for All Urban Consumers (CPI-U)

On a seasonally adjusted basis, the CPI-U was virtually unchanged in September following a 0.1 percent decrease in August. The index for energy fell 1.9 percent in September following a 3.1 percent decline in August. The motor fuel index declined 0.8 percent in September but was 31.8 percent higher than a year ago. The index for household energy fell 3.4 percent in September after a 1.6 percent decrease in August. The food index advanced 0.6 percent in September, the same increase as in August. The index for food at home rose 0.6 percent in September after a 0.8 percent rise in August and is up 7.6 percent over the past year. The index for all items less food and energy increased 0.1 percent in September, decelerating for the second straight month. Contributing to the deceleration were downturns in the indexes for apparel and for airline fares, a smaller "

Most of the reason that things were unchanged, is you look at the table, seems to be thanks to energy going down 4.9% on the three-month annualized rate.  But, while that was coming down, the three month food annualized rate was going up at 8.7%.

 

Tied to cost of living numbers:  "Social Security benefits taking big jump" up next year.  Gee, announcement coming close to elections...how about those coincidences, huh?

 

Oil Helps?

One of the things helping the consumer price index is that oil prices have been coming down of late.  Also not coincident to the elections just around the corner, oh nossir!  And, for what it's worth, the price of oil has continued to come down overnight and that means prices are getting near the $70 a barrel level. 

 

With Friends Like This Department

I can't help but notice that the US left-turn toward nationalizing financial outfits has caught the eye of Hugo Chavez of Venezuela.  He's now referring to "Comrade Bush"... Iran, meantime, is hailing the financial crisis as the end of Capitalism.  Well, not yet...  But that assessment is not too far from the thoughts of Australia's prime minister who calls it the 'failure of extreme capitalism."  Pardon me, but is there some other kind?  LOL... With friends like these...

 

Market's Tumbling

Despite the bounce at the open coming this morning from 'tame inflation', overnight in Asia was not a happy scene....markets were down substantially in the wake of yesterday's US market mini-melt.  This is their worst performance since the 1987 crash, if you're keeping track.  Did, or did I not, tell you earlier this week "Enjoy it while you can" when the Dow posted its near 1,000 point one day miracle?  The NY Post calls it a "Slo-Motion Crash" but we may have a bounce today...as in dead cat bounce.

---

There's been some question whether the Lehman settlements would weigh on the market as much as the sub-prime mess has.  One post I ran across said, as a matter of fact, more.  "With the settlement at 91.38 (cents on the dollar) the total due to be coughed up here is $365 billion"  and that's way more than all the subprime bond blow up...  I think you could have bought all those bonds for $200-250 billion.

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You did notice last month in the prestigious Columbia Journalism Review that the "alternative press leads on policy roots of the credit crisis" for singling out folks like Phil Gramm and wife for having a hand in building the derivatives cookie jar? Enron seems like so very long ago...

 

Money For Nothing Department

The headline this morning almost makes it sound like we should not be raging pissed about Citigroup being a recipient for "money for nothing" from the treasury, after all:  "Citigroup posts another loss amid credit woes." 

 

But wait!  I smell a rat.  Citi's Q3 loss was 60-cents.  But when I flip over to BusinessWeek earnings page what do I find?  They were expected to lose 70¢ this quarter.  And if I have the dates right, that's before the "free money" hits the books - which may happen in Q4.

 

Meantime the feds "voluntary plan" to help foreclosed homeowners has not been very effective and a BusinessWeek story this week quotes a Credit Suisse official as saying that another 3.6-million homes could be foreclosed between now and 2012 - and I'd be willing to bet it'll be far worse than that.

 

Keep in mind that the current round of 'happy-talk" doesn't include the Dow dropping to the 5,900 (or lower range).

---

Speaking of which, my friend Robin Landry, the broker up in Shawnee Oklahoma who I've told you has a pretty good handle on things, called me last night to say that as he lines up his proprietary set of indicators this is not the bottom yet.  He's sticking with his 5,800-5,900 range being possible on this move.

 

What this means, for those of us who are armchair economists, is that the brown stuff is hitting the rotating thingy in a big way globally. 

 

I mean besides Citigroup planning to hack 11,000 more jobs, Air India is planning to axe 15,000 positions, says the Times of India.  India's private sector owned Jet Airways is laying off 800.  How will all the outsourced IT and customer service reps get around, huh?

 

Breakthrough electric sportscar maker Tesla is planning major layoffs.

 

The Dallas Independent School District is postponing a layoff that will impact 1,100, but I figure it will come in time.  Things are not good out there.

 

There's a lot more to weed though, but you got the picture, right?  The problem we face is that now that the economic snowball is coming down the mountain, it has 'tipped' the country (and rest of the world, too) over into the reverse of the 'virtuous cycle' that created the service sector economy in the first place.

 

I'm working on this week's report for subscribers to Peoplenomics and it's all focused on how to spot and transition into a job has a tangible. m Things like agriculture, basic skills (factory building) and so on. 

 

the good news is that as globalism dies of self-inflicted financial wounds, there will be a tremendous opportunity for rebuilding America with more rational, less exploitive, more personally rewarding employment and a whole lot more time off so families can get back to one parent working - that kind of thing.

 

In my wildest dreams America rediscovers a word that went missing when industry and advertising hype overran global consciousness in the 1950's: Craftsmanship.

 

Some Blow

Hurricane Omar is up to a Category Three Hurricane, but since it's heading out to sea from the Caribbean, no danger to the U.S. mainland for now.  Not a nice storm if you're on the islands near its path, however.

 

The Runs: Tense?

OK, some of the reports about the presidential wannabe debate used terms like "tense".  Please. Many, thought more like NoDoz.  Isn't there a "Big Book of Better Adjectives for Reporters" out there?

 

Web Bot Project

What was "Military" October 15th?

Word out of Israel that there has been a "Large-scale Iranian Air force exercise simulates attack on Israel" is definitely worth noting.  We're still in a 'window" so a weather eye toward things military continues through the end of the week.

 

That and of course, the British "Govt. monitoring 'another great plot': security minister" which has been perking for a couple of weeks now.

 

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Coping: Notes from the Checkbook Republic

"Have Money, Write Law" is not a concept limited to inside the Beltway in the District of Corruption, although for sure that's where the infamous art has reached its zenith.  There are other places where the phenomena can be see as well, including - and today especially - New York City.

 

It's there that Mayor Mike Bloomberg is trying to get laws changed so that he can run again for a third term.  Today and tomorrow New Yorkers will get a chance to turn down this infinitely dumb idea.  Not that Bloomberg has done a bad job, don't get me wrong.  Who am I living 1,370 miles away here in the East Texas Piney Woods to be critical of Hizzoner? 

 

No, there's something else at play here:  The Framers of the Constitution both of the US and New York, probably understood that change is a good thing.  And that's why Mayor Mike oughta just give it up and stop trying to rewrite history.  Give some fresh blood a chance.

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By the way... a number of readers wrote in response to yesterday's column where I proposed that if anything, the terms for politicos should be getting shorter not longer and I suggested online instant elections.  (Clink and you win another month in office...and you have to stand for continuous online reelection so you'd damn straight better be listening to voter/clickers...)

 

One reader - and this floored me - wondered what I would propose to do with the existing pols who had  enough seniority to rack up major publicly funded retirements.  The reader seemed appalled that I could even think about a scheme that would renege on their existing retirement plans.  Watch me...

 

Listen:  I have seen literally millions of Americans lose their retirement and life savings in the market decline, which near as I can figure was brought about by an abject failure to conduct adequate financial oversight and excessive government spending and the outright buying of laws by the financial industry.  And the health of the country continues to be undermined by Big Pharma and other 'special interest groups."  Can anyone but me say "captive regulators?"

 

That someone - a reader of Urban, no less - would say these very people who ignored the Will of the People on issues such as the Billionaire Bankster's bailout Bill are deserving of a retirement when the rest of us have seen our money watered down and our life savings eroded  and taxes squandered on things like Big Banks and pointless perpetual wars, is the height of absurdity.

 

Fortunately, this puts one of the great American Conundrums in stark perspective: Where is the line between America's 'sense of fair play' on the one hand and and outright foolishness on the other?

 

No, it wouldn't break my heart to see a little applying of the Golden Rule here.  Do unto them politicos just as they have done unto us...KY optional.

 

Linguistic of the Day

Within seconds, CNBC and then Fox were talking about "Joe the Plumber" this morning - and I was floored when Universe decided that I should get a third bump on this as it arrived by email as the "Urban Dictionary Word of the Day". 

 

Joe the Plumber is a distant cousin of John Q Public  and  Ned Ludd, maybe?

 

Mad as Hell...

It starts as a simple question:

"Hi George,

Could you tell me if this is an example of release language Mad as Hell
If so here is another version from Network in 1979 Network 1979
I thought I was detecting a little more release language in your writing yesterday! lol Thanks for all your insights!"

Yes.

 

I they it's also where Jim Cramer got his shtick, BTW...

 

AmRev2 Lingo

The language continues to pop up in postings around the web - in response to the government's mishandling of the financial crisis, Congress going deaf to the Will of the People and so on. 

 

Just so you know what I'm talking about: Here's an example noted by a reader.  Almost reads 'manifesto-like'.

 

I mention this not to endorse anything other than peaceful change, but to underscore for you that there is a building language sets of resentment & rebelliousness out and about.  If/when we get to events of 10XCSN, it will likely step up an order of magnitude -- or more.  Serious stuff to watch.

 

Ultimately, at least in language shift, it points to the "Summer of hell" in 2009, so we watch with trepidation as the collapse of the markets continues; headed first toward 'lockup' in November, a bottoming (not that it will be meaningful) in March '09 and then what follows in building tensions into next summer.

 

As the time monks are so fond of saying: "Changes in language precede changes in events..."

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Send snip and save items to george@ure.net

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Wednesday October 15, 2008

Producer Prices & Retail Sales

Newest number to throw into your economic blender:

The Producer Price Index for Finished Goods decreased 0.4 percent in September, seasonally adjusted, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. This decline followed a 0.9-percent drop in August and a 1.2-percent increase in July. At the earlier stages of processing, prices received by producers of intermediate goods fell 1.2 percent after decreasing 1.0 percent a month earlier, and the decline in the crude goods index slowed to 7.9 percent in September from 11.9 percent in the preceding month.

The slower rate of decline in finished goods prices was led by the index for energy goods, which decreased 2.9 percent after falling 4.6 percent in August. Price advances for finished goods less foods and energy accelerated to 0.4 percent from 0.2 percent a month earlier. Conversely, the rise in the index for finished consumer foods slowed to 0.2 percent in September from 0.3 percent in the prior month.

During the third quarter of 2008, the finished goods index fell at a 0.4-percent seasonally adjusted annual rate (SAAR), after climbing at a 14.6-percent SAAR during the second quarter. Much of this downturn can be attributed to the index for finished energy goods, which decreased at a 16.7-percent SAAR for the 3 months ended in September after jumping at a 51.6-percent SAAR for the 3 months ended in June. Prices for finished consumer foods moved up at a 3.1- percent SAAR during the third quarter after rising at a 9.2-percent SAAR during the second quarter. Conversely, the index for finished goods less foods and energy advanced at a 5.4- percent SAAR for the 3 months ended in September after increasing at a 4.4-percent SAAR for the 3 months ended in June. At the earlier stages of processing, the intermediate goods index moved up at a 2.1-percent SAAR during the third quarter after surging at a 25.7-percent SAAR in the second quarter, and prices for crude goods decreased at a 48.9-percent SAAR for the 3 months ended in September after jumping at a 79.1-percent SAAR for the 3 months ended in June."

After adjusting, finished goods are still up 8.7% year on year, so yeah, that looks to me a lot like a baked-in-the-cake 8.7% inflation rate.  So when you see sales falling it isn't JUST because people are cutting back on spending.  It's because prices are going up way faster than the 'offishul' prices that come out in the Consumer Price Index.

 

The good news (such as it is) is that the Crude Goods are down 7.9%  which means after a spurt of price inflation, things might get cheaper...

 

But, in the meantime, retail sales have plunged 1.2% in September.

The U.S. Census Bureau announced today that advance estimates of U.S. retail and food services sales for September, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $375.5 billion, a decrease of 1.2 percent (±0.5%) from the previous month and 1.0 percent (±0.7%) below September 2007. Total sales for the July through September 2008 period were up 0.8 percent (±0.5%) from the same period a year ago. The July to August 2008 percent change was revised from -0.3 percent (±0.5%)* to -0.4 percent (±0.2%).

Retail trade sales were down 1.2 percent (±0.5%) from August 2008 and were 1.4 percent (±0.7%) below last year. Gasoline station sales were up 17.8 percent (±1.7%) from September 2007 and sales of food and beverage stores were up 5.1 percent (±0.8%) from last year.

 

Government buys into profitable companies?  "Is the World Mad?" Department

The Missing Question is: "Why"

As a long-time journalist and occasional lecturer on reporting, I used to drill into new reporters that there are "Five W's and an H" in all good stories.  Who, what, why, when, where, and How.

 

So it's with this particular mindset that I have been diligently searching for "The Missing 'Why'" behind all this frantic tax-money giveaway as the Billionaire Banksters Bailout  rolls on, mostly recently dumping $125-billion into some of the largest banks in America. 

 

I'd willing to overlook this patently illegal and unconstitutional power-grab and intrusion into the now forsaken free enterprise system by Treasury if someone could just show me the "real Why" behind this story.  Let's go through some of the assertions and you'll see what I mean:

• "We need this money to avoid a global economic crisis!" was one of the rallying cries before the Bailout was passed.  This is a prime example of a half-truth.  Yes, the money may be needed, but the follow-on question today's crop of underpowered journalists are not asking is "Why?"  Where is the conclusive evidence...hell, something more convincing that a number pulled out of the hat...that $850-billion of our tax money would work. Crisis showed up anyway, didn't it?

• "We need it right now!"  Oh?  Why hasn't anyone asked "Why?"  It's almost like the corpgov media are getting a commission on this 'sale' to the American public.  Oh!  Now that I study it a bit, they are!  If the status quo fails, ad revenue falls and that means big trouble in medialand.

• "We could have bank holidays and martial law without it!"  That was, according to Congressman Sherman, actually threatened.  But again, the question is "Why?"

 

Maybe I'm just too much of a hard-ass consultant, but I've been around some pretty darned good - tough - management teams and believe me, a half-cocked idea is usually best assessed by asking the "Why?" question -- repeatedly.  Like no one is doing of Treasury or Printer Ben.

 

What I want - and what the American people genuinely, truly deserve -- is some better evidence of  some big "Why" behind this stampede.

 

throwing money all over the place hoping to avert a crisis isn't going to help.  Earmarked funds to bring down LIBOR, or earmarked funds for new loans, or earmarked funds to defer mortgage payments, yeah, that would help.  But this?  OMFG who are they kidding? 

 

What would be acceptable?  Maybe someone in the Fed or Treasury has an econometric model that has been accurately predicting the economic future of America for some number of years so the political powers can make wise decisions.  If so, this computer model obviously isn't being widely used, but if it exists at all, WHY not roll it out and say "Here are 18 main multiagent simulations with 40,000 agents in play and you'll see that of all possible places to inject money, the one with the highest payoff probability at the best price is this one..." And, presumably that would be the course we're following.

 

Unfortunately, there's just one little problem:  I haven't been able to find anyone in this whole story getting back to a well-sourced "Why". 

 

The government says quite sincerely, I hope, that they need the money "Because"...and the financial press doesn't do what their name implies...press the point that "Because" is not an adequate answer to "Why?" questions.

 

This seems particularly outrageous when the Treasury figured it was necessary to buy an ownership stake in JP Morgan.  Morgan just posted results this morning and guess what?  They made money.  They are expected to make money in Q4 as well. 

 

What the hell is treasury doing giving money to a company that is already profitable.  Where the hell is the Fourth Estate asking "WHY?" 

 

Where's the computer model that says this is the best possible move?  Where the academic proof, where's the analysis?  Where's the track record?

 

This is outrageous and  repugnant to any reasonable person.  "WHY is the government insisting it give JPM money?  "Because" is not an answer.

 

Rather than let my blood pressure go any higher, however, there is a bright spot.  With an exception of Congressman Hensarling (R, Texas) and a hand full of others who had the good sense to vote NO! to the tax stampede, the Treasury just made my job as a voter way easy:

No to all incumbents.  No to the Bankster party.

Thanks Hank, for making voting so much easier this year.

 

How much have the world's bankers held up governments for?  Hmmm...here's a report that the bailout package comes to $2.25 trillion in the US alone...then we have another $2.3 trillion in Euroland... gosh, what a racket.  Just send us $5-million and I will shut down this site and go sailing!

 

Happy Spinning Department

Our new 'happy-talk phrase of the day' is the "Buy-in". As in

• "Treasury's $250 billion Bank Buy" or...

• "US Govt. Unveils Bank Buy-In Plan" or...

• "Government's bank buy-in includes Iowa" or...

 

Most tellingly, there's an AP headline that reveals for the aware a sharp observation of how spin & win is played by the Tax/Oil/Banker party:  "Bailout becomes buy-in as feds move into banking".

 

"Smaller banks resist federal cash infusions" says a report.  But I doubt they will  be able to stand up for what's right and legal for long, abuse of power being what it is now days.

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Remember those old love songs in Top 40 radio?  "You can't make me love you" sort of goes along with "You can't make me loan you..."  Same kind of dysfunctional stuff going on in both cases, seems...

 

Is it to early for a shot of Jack?

 

Web Bots

3 Unwanted Guests, Other Matters

A couple of people were wondering what the 'three uninvited guests" of last weekend were.  Best I can figure it's the Haider accident/killing/murder in Austria, the World Bank hacks, and then the rescue would be take your pick or the rescues in the LA fire, but more likely the fire sale/rescue in banking.

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The short-term things are usually smaller/not as obvious fits. 

 

I'm still waiting for the military component of the economic collapse to show up.  Don't know whether that will be something new, or just a recycling of the martial law being threatened.

 

over the longer term (where the technology is at its best) the continued declines in the economy through next March, layoffs (like the ones beginning in the NYC Financial District, and the double quakes due in December look more likely to pan out.

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On the other hand, when the linguistics are clear and right on something as large and obvious as the October 7th call, it's sometimes frustrating.

 

Yesterday, for example, I got a call from a reader who said (in so many words) "Where was your October 7th [economic] event?" 

 

I asked this fellow if he had been living under a rock, and hadn't noticed how the entire Western Economy arrived at the brink of global collapse on Monday/Tuesday of last week.  I then directed him to go look at the CoastToCoastAM New Years predictions made more than 9-months back which you can still find here.  Scroll down to page three and the slide titled October:

October:

• Global emotional release event begins – largely economic.

• Think of the US economy as a lit fuse that is lit over the early part of 2008

• In late 2008 the rest of the world’s currencies are ‘touched off’ by the dollar and US decline.

• May be a global replay of what the 1932 bond crash in the Great Depression was.

Not to toot our own horn too much, but that wasn't a bad call, was it?  I mean, who else was calling the October mess (which we're now in the thick of) 9-months ago?  (No one I know of...not with that degree of specificity...)

 

A reader wonders:

"George,

It looks like in your latest update there was no Mention of the October 15th date with the 40% military, 40% terra and 20% financial components (if I remember The ratios correctly). Is that event no longer in the Cards?

Not that I'd be disappointed, but what is the thinking Of the Time Monks when something appears along ways off And when you get close it vanishes? Was it a mirage?"

There's a certain amount of that to be sure.  A couple of possibilities - which we keep thrashing on:  One is that the martial law stuff which was part and parcel of the bailout is really out and about, along with NorthCom having troops deployed inside the US - no doubt you've seen that on the next.  Another possibility is that we could get an Iran attack any one time prior to the election because it might play better with a lame duck in the White House.  Or, it could just be an artifact of processing.

 

Whatever the outcome, we're seldom disappointed:  We wouldn't want to be right on everything because that brings with it a special kind of risk by itself.  So, we wait and watch for those "breaking news" banners just like everyone else. 

 

Better than chance?  Yes, obviously.  Perfect?  Of course not.

 

Globull Whating?

Hmmm...this will no doubt get me flamed by readers who are more interested in getting an emotional attachment to news instead of collecting observations and facts.  Despite that risk, I will continue to give my icy assessment of globull warming with this latest selection of headlines:

• "Arctic glaciers grew this year, thanks to colder weather".

• "Weekend cold (in Oregon) set new record lows"

• "Frost "One more thing' for grape growers" in California...

• "Record cold temps hit Tucson"

 

Yeah, I know all about the climbing CO2 rates and such, but when you look at the lack of sunspots and the hard data coming in, it's possible that much of what was ascribed to global warming was normal cyclical stuff.   

 

"Chicago area going from record heat to frost in less than a week" reminds us to keep an open mind and look only at long-term climate data...and glaciers and such in some places are building...

 

Most sunspot free days in over 50-years means what?  Cold winter.  Duh.

 

Bushco Approved Waterboarding

The "Bush administration approved CIA torture techniques, report says."  the administration has held itself above the law an unaccountable on most everything else, so why this latest would come as a surprise to anyone is beyond me...

 

The Runs:  Last Call

"Stakes high as Obama, McCain head for final debate" says an AP headline today.

---

My neighbors across the road were busily telling me how Obama would be a socialist because he wants to "to give money way".  Afterwards I congratulated myself on not mentioning how the bankster's junta has been doing.  "You can't patch a dam with water" was about all I offered...

 

With candidates Bad and Worse running  (go ahead and guess), I'll be pulling any third party levers I can find.

 

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Coping: Cool Room Time?

If you happen to have an assortment of leftover/recycled greenhouse glass, a bunch of 2-by-4's and a little time on your hands, you might want to build a south-facing cool room with enough overhang to keep the summer sun out. 

 

This comes up for discussion this morning after looking at an Investor Business Daily op-ed piece called "Avoiding a Blackout" which looks to next summer as a time when the grid might be failing, or at least going through widespread rotating outages.

 

If you have plenty of lead time on such an event, you could frame up a nice earth-sheltered room or two as an add-on to your house.  A small earth-sheltered rooms, perhaps 15 by 20 could hold a couple of people, and if the purpose of the room is kept in mind (reading and other low energy uses) 4-5 feet of earth berming can do wonders, conducting heat away from the room.  Even in the hottest parts of the country, you get down more than a few feet underground and the ambient earth temp is usually bearable.

 

In your calculations, remember that each human in a room puts off between 65-90 watts of heat (just like having a light on) so the keys would be to use lowest heat products in the room.  LED lights, of the type becoming widely available for remote cabins and RV's is simple.

 

OK, sure, moving yards of dirt around doesn't seem like much fun, but when you consider that a human-oriented cool room/library would be a low to no cost to cool setup, and given that the power will not always be on, it could be worth the work over winter.

 

We've got so many projects going on that this one will not come up for months.  Nevertheless, the "$50 and Up Underground House Book" and other earth-sheltered concepts are preying on monkey mind.  There's a reason that many animal are nocturnal and live in holes and recesses into hi8llsides in hot weather.  Of course, that may not fit with local building departments.

 

Out here where we don't have an aggressive building department or a fascist property-owner's association, such things are readily accomplished.  But, like the old say8ing goes: "It's easier to ask forgiveness than permission..."  

 

A hundred feet of 12" PVC pipe laid in the ground and powered with a ,good quality 12 or 24-volt fan (and a solar cell) might pump in enough additional cold air to allow for a radio or small LCD TV...if not, another pipe for more air....

 

Super Glue and Questions

Turns out I'm not the only one doing wound dressing with Super Glue:

"Hi George,

The Universe must be talking, but I'm not sure what the "hand-slapping" is all about since Sunday eve, I sliced the tip of my left index finger while slicing a water bottle in half for a project, then Monday (yesterday) about noon, I sliced my ring finger on same hand trying to get some glue off the blade of a scissors, then last night, I almost sliced a side of my other hand by the little finger while scrubbing a pan lid, but didn't get "sliced".

However, tonight, I got home from work (after stopping to buy Super Glue at Walgreens for the two cuts) and proceeded to clean out the "iffies" from my fridge, and bring that trash down to the barrel, and while downstairs, I noticed that my downstairs neighbors (in my duplex) had lowered the top half of the screen door window, and it's now cold again here. So...while trying to raise that window, it slipped and it fell on the tip of my ring finger of my right hand and that nail is now turning black. So one person, three hand mishaps, and I think Universe should be done with me for now, BUT, it has my attention and I now have a question or few for you:

One, etc...: Forced 401Ks with an "established" group...mine's Fidelity. We all know that they offer different things to different employers. However, I'm in a quandary...do I go bonds long run or short term treasury? I know you don't offer advice...just look at this as a "Dear Abby, if you were going to commit suicide, would you go with bonds or short term treasury, (or hang yourself....etc....)" question. Is the bond market going to crash, as I have been reading of late? Is there ANYPLACE "fun" to put a few bucks in a company plan these days?

George, Ure site is one of the best on the net!!

Thanks, A Devoted Dear Reader

PS, I had forgotten about super glue for cuts since my 9-lives, fully lived, outdoor cat went down a few years ago after a good long almost 15 years of high quality life. Anyway, early on, one of the Vet visits was a "glue" visit. Again, Thanks for the reminder!"

Look, I can't say anything about this fund, or that, as I am not a licensed financial professional.  Nor, given my surly attitude and disgust with the hijacking of finances by the den of thieves, am I ever likely to be.  But what I can do is offer my personal perspective which continues to boil down to this:

• Paper assets of any kind have little to no value when an economic system is imploding.  It doesn't take a rocket surgeon to figure out that with the various one-worlder governments pouring in about $4-trillion in bailouts so far that "Gee, do youi think there might be some trouble with paper ahead?"  Remember how much a billion buys in Zimbabwe these days.

• That said, Wal-Mart, Kroger's, Safeway, Brookshire's, Wynn-Dixie and whoever, still take cash money - so you have to play the paper game at some level.

• Thus, the prudent person might want to have an approach of spreading risk in as sensible a way as possible.  Maybe some precious metals.  Maybe a good gardening plot, perhaps a skill or trade that will still mean something when the lights go out.

 

Ultimately, it comes down to a personal choice.  Our approach is to have a gold coin, a silver coin, a savings bond, an FDIC insured checking account, $10 cash on hand and lots of tools and food, plus a solar panel and well drilling gear.  If I could come up with more options, I'd probably pursue them, too.

 

Is Social Security Safe?

Question:

"George

Wondering what you think as far as what is coming and how it will affect people getting Social Security checks. Will they continue to be issued? Our property in the north of Idaho is paid for. We have no debt. We have food storage and of course guns and ammo. My Social Security check is not much, only $500.00 a month. But it helps get by. Should I be planning on it not coming in the future?"

Social Security has never been put to the test of a real economic depression.  Do I personally think it will last?  No.  Would I start planning to have something else up my sleeve?  gardening?  Something like that?  Hell yes!  Another reason?  See following item...

 

No Faith In Government?

Here's a reader's reasoning:

"Not looking good for the bailout

Back in 1990, the Government seized the Mustang Ranch brothel in Nevada for tax evasion and, as required by law, tried to run it. They failed and it closed. Now we are trusting the economy of our country to a pack of nit-wits who couldn't make money running a whore house and selling booze? "

On the Horizon

What one reader sees coming:

"I got inspired, so decided to torture you with these:

Top 10 pieces of good news about the coming Greater Depression

10) Lawyers to starve, be exiled into "unfair" wilderness, encouraged to file complaints with bears.

9) Fewer trees to be pulped to create "dollars", more log cabins mean "Abe Lincoln Day" forever

8) "Mad Max: Beyond Thunderdome" rentals to go through the roof as Bartertowns spring up across the USA, "2 men

enter, 1 man leaves" to be motto of local sports teams, Master/Blaster to become most popular mascot/Halloween costume/job

7) Fast food to become more considered, moderate in pace.

6) Political parties to crumble in favor of individuals who actually know, do stuff

5) "Career politician" to mean a mayor who continues blacksmithing while serving in office

4) Paris, Oprah, rappers to live remainder of lives in quiet, contemplative solitude

3) Arab countries to get back in touch with nomadic, camel-based roots, Central and South America to pretty much continue as usual.

2) Solar clothes dryers to be found strung near every family's home.

1) Obesity and related health conditions to vanish as concerns.

---

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Around the Ranch:  Cause and Effect

So here was the local power company tree trimming crew and there was one of my hundreds of pine trees and it had a brown patch developing on the top.  Looked like it might be bark beetle. so I asked them to take it down with their right-of-way-clearing gear, because at some point it would have fallen into a power line anyway, as the disease spread.

 

Wouldn't you know it?  In trying to prevent a future outage, the book driver knicked the power line, which resulted in a blow fuse on the pole in front of the house, and took down the power.

 

Some says are like that:  You work really, really hard to avoid something, but in doing so, you cause the very problem you're swerving to avoid.

 

---

Tuesday October 14, 2008

Enjoy It While You Can...

The Dow Jones Industrials soared on Monday in their biggest one-day gain in about 70-years, but somehow, I'm not standing up applauding the market's move.  Why?  Because it lacks substance.

 

When I say substance, what does that mean?  Oh, little things like a large number of new products coming to market, or being announced, that will open up a whole new kind of business.  None of that was evident yesterday, other than the usual flurry of high tech incremental developments, none of which comes anywhere near making "Mr. Ure's Absolutely Gotta Run Out and Buy One" list.  Not even.

 

Well, what about earnings, then?  Again, sorry to say, there's no sign of anything big going on there.  Oh sure, in some ways, the Boeing strike, which looks to drag on a bit longer as Machinist ,talks are reported to have collapsed, might allow it to actually make a little more money than if the strike had not come along (personnel costs and all), but in the end the Boeing strike will be a big negative for the U.S. balance of payments deficit.  So when the BOT report comes out for the strike months, remember as an armchair economist to back down the U.S. export figures by whatever the delayed deliveries would have been worth.

 

Meantime, the strike is impacting the Boeing supplier community in the Pacific Northwest says the Seattle P.I. (Post Intelligencer).

 

If there's no new 'gotta have it' and the Balance of Trade is in jeopardy from the Boeing strike, what about earnings, then?  Nope.  Nothing new to report there.

---

So where is all this glee and joyousness coming from?  Your kind contributions to Wall Street.  Government largess seems to know no bounds.

 

Later this morning, the administration will unveil its plan to semi-nationalize the banks with $250-billion which will be sucked out of your wallet through various taxes.  

---

But wait!  Is this making sense?  I mean, why would the Treasury Secretary and Commander in Printing (Ben Bernanke) be all fired up about spending $125 billion on the nation's 9 largest banks? 

 

Consider that on e of the recipients of $25-billion will be JP Morgan Chase & Co.  Here's an outfit, which went I look at their earnings still looks to turn a tidy profit for the year.  OK, I'll grant you that the BusinessWeek earning page on JPM shows they could lose 18¢ for the quarter, but the estimates are they will spring back with positive earnings of 63-cents in Q4.

 

So why the money?

 

The theory that we're asked to believe is that this will somehow 'encourage banks to resume lending' and this will magically get the economy back on track.  Lacking the high-dollar education of some of the nation's leaders, it seems common-sensical that the Banksters have got quite a racket going: Simply stop lending long enough to turn on the 'free money spigot' and generously offer to resume lending when enough ransom has been paid.

 

You & me?  We're in the wrong business, kid.

---

Keeping track of how much money has been extorted from regular humans around the planet in this attack of the financial highwaymen is a little hard to sort out.  Close as I can tell, here in the U.S. the tab has been over $1.5-trillion dollars - a bit more than 10% of everything made in America this year.  Over on the other side of the pond, European governments have promised to put $2.3 trillion on the line.

 

Having the relative luxury of being a nutjob in the East Texas outback, I get to sit back, watch the goats, and ask simple questions that seem to defy the experts.  "How does any of this keep a buddy of mine in Chicago out of harms way since last I heard was being strung out 75-days on a $300-thousand invoice due his firm?"  It won't.

 

Or, how about "How does this help one of our kids in danger of losing a home in the Phoenix area?"  It doesn't.

 

All that I'm hearing so far is "We gotta save the bankers!"  To which I respectfully submit that "We gotta save America and America is not just fat-cat bankers (although they do hold more sway than regular humans as evidenced by the ease with which they were able to write sufficiently large checks to overrule the Will of the People in the Bailout Bill)."

 

The fact of the matter is that one global economy has failed already.  In Iceland, "...shoppers slurge as currency woes reduce food imports."  That's a situation that I expect will come to America when the bankruptcy of the current "Save the Bankers!" mania comes home to roost over the coming few weeks.

---

Meantime, one of my sources who's fairly up the food chain in a national news operation admits privately that while there's no paper trail from the top, the verbal edicts about word choices made by reporters are there is spades lately and the PTB hate the world "bailout". 

 

Bailout!  Bailout!  Bailout!  What happened to telling it like it is?  It's not a rescue!  It's a frigging theory from guys who don't wash their own cars or mow their own yards, for heaven's sake.

 

If you were going to the Big Box Store of Economics, why would you believe folks who can't even figure out what 'winning a war' is?  It would have been cheaper to confer statehood on Iraq!

 

More to the point: Where's our money back guarantee if this printing press 'spray and pray' doesn't work out?  This is a clusterboggle of the highest order.

 

Enjoy it while you can.  The rest of us will probably keep on shoring up our stores and tuning new skills in order to face the rest of the meltdown ahead.

---

The best & most current read of the predictive linguistics out of www.halfpasthuman.com suggests (other than 10XCSN in a few weeks, which I'll explain when/if it happens) we may be in a bit of a pause between front of the economic storm until November 20th to 24th, when the next big leg down should appear.  Between here and there, something that reads like 'restrictions on words teevee/markets - lockdown at some level' should show up, so looks like those verbal reminders to not use the word BAILOUT! so much will become more strident.

 

One we get to the next leg down, the expectation is that we'll have some kind of markets seizure, with the term force majeure coming up (don't ask where, we don't get that level of granularity, and besides, even if we did, we wouldn't say - the moving finger writes and all...). 

 

Linguistically, it's like the dollar goes the way of Iceland's currency before Christmas.  No, it's not the Euro, although there's plenty of criticism of the Euro out there,  On the flip side, the Danish Prime Minister points to Iceland's currency failure as the 'high cost of rejecting the Euro."

 

Whatever the 'dollar' problems are coming by December, they are not likely to be Eurodollar - more likely it'll be aimed at all those freshly printed U.S. bills as the specific language arises with the USPop entity in modelspace, not the GlobalPop entity.

 

Could someone try to 'play the bounce?"  No doubt a few subscribers to Peoplenomics are playing it, since our chart in last weekend's report seemed to paint a possible path toward 10,200 on a strong bounce in here, but the linguistics offer scant hope that a move to new highs is in the offing. 

 

Like I said: Enjoy it while you can.  You're paying for it, one way or the other.

 

Daily Spin Scoring

Google's news search tool shows 328,846 hits on 'bailout' this morning and 182,216 on 'rescue plan'. (511,062 total)  So holding at 35.65%.  Just benchmarking this so when the controls on TV verbiage are push down, we can see how well they're working.  See how helpful we are to the PTB? LOL...

 

We'll put this aside till next week, but next week and the week after, as the Google cache clears of the older stories and as the improved spin comes down the pike, we're almost certain that the arrogance of Congress in ignoring the Will of the People will be rewritten out of history and no news organization that wants entre will dare report the calls and ask "Why did you (fill in the names) vote against what the People wanted?  Nossir, accountability is not a strong suit lately.  Which brings us to...

 

Quality of Government Department

Wonder why the country is headed for a continuation of the economic disaster?  Here's a headline that we take as a 'tip of the iceberg': "Congressman's $121,000 payoff to alleged mistress: Tim Mahoney elected to remove 'ethical cloud' of his disgraced predecessor, Mark Foley."  You go, Brian Ross.

 

Mahoney has responded to the report by calling for an investigation of himself.

---

We'll pass on the obvious snide remark toward West Palm Beach voters ("They sure know how to pick 'em comes to mind, however...) and note that Florida has continued to cement its place as the New Cook County of America ever since the 2000 presidential contest.

 

The latest embarrassment is the discovery that 30,000 felons are on the voting roles there.

 

Financial Fallout

A friend of mine in Washington state asked, "I get the sense with the rise in foreclosures that crimes against persons will increase..."  Yes, indeedy.  "Officials:  Financial Crisis can lead to violence."  I reckon by the time the stats catch up crimes against persons will go up 5-7%. 

 

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Coping: With Parallax

A number of people wrote in yesterday that my explanation of how rifles work (rising beyond sighting range) made it could like the laws of physics didn't apply.  OK, a more complete description and discussion is in order, just so you don't think the laws of physics are broken by recreational shooters.  Here's the problem in a nutshell (filed under 'parallax'):

 

Typical reader email on the topic:

"George, a rifle bullet DOES NOT RISE after leaving the barrel. The APPARENT RISE has to do with the adjustable sights of an assault-type rifle, or the scope of the bolt rifle, being ZERO'd at certain distances; e.g., zeroing at 100 yds., or 200 yds. etc. The zeroing of the rifle causes the barrel to be pointed up, above the level plane that represents the line of sight between you and the target. That's all. So, to tell people that a rifle bullet rises after leaving the barrel, as opposed to dropping from a pistol barrel is quite misleading.

Merely due to velocity differences the pistol bullet will fall faster than the rifle bullet.

Look into some youtube videos on zeroing your rifle to see a better explanation.

Oh, yes, I see I left this out. If a rifle is zeroed at 200 yds., this means that the bullet, under a normal falling trajectory, will cross the level plane again at 200 yds., hence, hitting the bull's eye at that distance. This is why the barrel must be aimed "up" from the level plane, hence, the apparent rising trajectory of the bullet.

With the pistol, though, one can use adjustable sights to accomplish the same thing, or one can just aim a certain number of inches above the bull's eye, depending upon distance to target.

Best Regards,

(name withheld)

p.s. Spray and pray is almost worthless, unless you cannot see the target, or your intent is to frighten your opponent. There's no debate on the subject. Learning to put a bullet where you want it to be every time is essential. Learning proper technique and practicing will do this for you.

And, thanks to a lack of coffee when I wrote yesterday's column, battle siting is 25 meters/roughly 75 feet not the 75 yards. 

Fluoride Free

Reader feedback on fluoride in drinking water and tooth care products:

 " http://www.all-natural.com/fleffect.html    

Please scroll down to "Fluorides have been used to modify behavior & mood of Human beings"

I'm sure you'll be sat back in your chair, right from the get-go ... but to read that Fluoride was used to control POWs is shocking when you consider we ALL get some of this stuff from drinking water and toothpastes. - Perhaps this is what makes many people, Sheep."

Free Money Department

This is interesting:

"Hi George,

With all the talk of nationalizing banks and other financial institutions. I'm confused why no one has picked up on this yet.

http://www.hud.gov/news/release.cfm?content=pr08-150.cfm 

In summary, this new program allows the government to step in and take control of 5-10% of your homes property value in exchange for requiring your lenders to accept 90% of your homes value as payment in full.

The program seems to work out great for the homeowner whose mortgage is upside down.

The gotcha is when you sell or refinance your home, the government gets between 10 and 5% of the value of the sale depending on how long you take to sell it. They get 10% if you sell it within a year graduating down to 5% (and remaining there) after 5 years.

They then take their proceeds and pass it out to your previous lenders, but if there is anything left over, they keep it.

My only worry is that this is yet another step in the big government plan to nationalize everything.

What is their next step with this program? Since they own a piece of your property will they have a say in how it is maintained, what you are allowed to do inside it, etc.? Is it a co-incidence that this program started up at the beginning of this month?

This all plays into a theme that we've broached from time to time over on the subscriber site, www.peoplenomics.com; namely that the trend is for people to rent their lifestyle.  Since we can't take much of anything with us when we die, the concept seems to be that government should have more and more control over that which we have for our use while we're here.

 

For example, property taxes assure government that at some point, they will get "their" land back.  This is just one more step in that direction.

 

A lack of coffee keeps me from getting into some of the ramifications of all this, but that oughta be enough to get you at least asking the question:  Who really "owns" stuff?  Obviously, you don't.  Just try not paying taxes for a while and see what happens to all your "stuff."

 

Just A Coinkydink

Yeah, I'm not the only one developing a cynical view toward gas prices and elections:

"In Michigan: Gas in August 2004 was 3.16 and by Oct that year is dropped to 2.16. This year in Aug/Sept it was up to 4.00 plus, and today in Oct it's 2.99.

Must be coincidence, I'm sure."

Hey!  Here's a thought next time some would-be hijacker of the Constitution starts talking about the so-called 'need for reform'.  How about we simply start with instant online elections.  Go to Washington.  Do what the people who put you there say, or you're out in 7-days or maybe 30.  Besides, if Congress was constantly elected, the People would at least have a chance to bid as much as the political action committees!  Maybe go with one-month terms for Congress, two months for the Senate and 90-days for the the Presidency. 

 

Why not?  I mean if we have a Constitutional Convention, let's not get hung up on just institutionalizing marginal persuasion blocks - let's get structural.  And that means more responsive not less.

 

Cool, huh?  I mean, the way I see it, we could simply farm out the whole election process to eBay and give everyone eligible to vote something like a military CAC card for voting... Yeah, that's it!!! 

 

Didn't listen to the home district on something?  Like the Banker BAILOUT?  Wham...clicked out.  Next contestant?

 

Purr-fect Health?

Some comments on cats and purring caught my eye:

"Dear George,

Your muse on purring leads me to write about the benefits of its human equivalent, humming. Back in 2002, researchers at Sweden's Karolinska Hospital studied humming and its effect on the sinuses. Humming occurs only during exhalation and they found that humming increased the gas exchange rate between the nasal passages and the sinuses to 98% from 4% when not humming.

They also found that nitric oxide levels were increased by 15%. Nitric oxide improves circulation by dilating the capillaries. This is a good thing. Nitric oxide relaxes your blood vessels, lowers your blood pressure, and is the molecule that makes Viagra work.

So, is there a practical point to all this? I used to have sinus problems and humming was part of my solution. I acquired an asthma nebulizer machine, put 3 ml of Xylitol nasal wash in the mist chamber, inhaled the mist through my nose and hummed my sinus problems away three times a day. It was a cool, inexpensive and effective self-experiment.

This is not intended to be medical advice. What I did is not approved or sanctioned by any of the medical PTB. I'm just demonstrating that somehow I managed to connect a bunch of different dots. When I learned that humming opens and oxygenates the sinuses and that the 5 carbon sugar, Xylitol, kills germs that cause sinus infections plus tooth decay, then all I needed was a delivery system. Abusing a nebulizer machine for nasal delivery was the last dot.

I'm a dot-connector. So are you George. That's why I enjoy your newsletter. When's the last time you saw a cat with a sinus infection?"

Ah...not the right question:  The real question is when was the last time I caught the cats in the fridge trying to take hits of nitrous oxide off the pressurized whipping cream can.  That would be last night for their monthly "full moon party"...I didn't buy their "It's for our sinuses" excuse...

 

I'm feeling a sore throat coming on...gonna go hum now....

---

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Around the Ranch: Super Glue's Great

It's not liquid stitches, but plain old Super Glue works fine on the second day of the sliced finger adventure.  Back to 100% - just feels a bit strange.  Another tip passed on from a dermatologist I once went to who said use super glue on seriously cracked skin or on cuts:  She also said if you want something that's close to human skin oil and cheaper than most things in stores, get a can of the white whipped Crisco.  Like practical a lot.

 

Time Monks and Pies

For more than a year - maybe three, come to think of it, the Time Monks at HalfPastHuman have been talking about pie.  This time, pie that.  Huckleberries, blackberries, peach...oh the list goes on and on...

 

Now, they're faced with their 'pie meme' going viral as presidential wannabe Barack Obama has gotten onboard with pie.  (Obama pie video)

 

Not far from the rickety software time machine, folks in Olympia Washington have started a "Pie Guild" dedicated to the art of pie-making.

 

While it's comforting to know that piecraft is an art available to people of all financial means  and spanning a much larger portion of history than just Obama's run (from Simple Simon met a what?), there's a great danger in pies, not the least of which are all those fruity and sugary fillings.

 

Fortunately, there's a whole class of pie that I first became acquainted with when Cayman Airways started flying from GCM to MoBay back in the mid 1980's waiting to be rediscovered and mainstreamed.  That's the pie called by locals a "patty".  A couple of patties and a 'greenie' (or two)  and that was a fine lunch on the beach while snorkeling with the kids many weekends back in that part of life.

 

If you sniff around the 'net a bit, you can find recipes for Jamaican meat pies.

 

Since the time monks found the meme and ramped it up, and now that Obama is on the pie wagon, I figure it's only a matter of time until one of the big national fast fooderies gets something besides the pizza pies out.   

 

Bet me?   Strategically, I'd suggest Pie Town, New Mexico for their corporate offices.

 

---

Monday October 13, 2008

Bounce Monday! Elections Must Be Near

Maybe sitting here in the outback of East Texas, I've become a little jaded when it comes to reading news headlines.  When the first thing that slaps the eyeballs is "Rush is on to get 'rescue plan' moving: Administration seeks to calm markets with quick action on bailout plan" I start to feel like the inhabitant of a UFO:  is this planet for real?

 

Having spent too much time in the strategic planning region of corporate America, my first inclination after another slug of coffee is to look at metrics.  Remember, a couple of weeks back I explained how "memeering" was going on around all this economic panic and the main thrust of 'spin control' would be the carefully worded newsroom memos about 'word us'.  Part and parcel of that, we watched as the term 'rescue plan' went from being less than 20% compared to 'bailout' to about 35% last time I looked.

 

My expectation was that 'bailout' would continue to wane while 'rescue' would continue ascension because American's love to 'rescue' everything from lost cats and dogs to Hillary Clinton.  (We'll have no snide remarks there, Citizen...)

 

As of o-dark-thirty, the Google news search engine threw back 334,382 returns on 'bailout' while 'rescue plan' was at 180,379.  That's a total of 514,751, so the 'rescue plan' is holding at 35%. 

---

As we start the week off, with a Bank Holiday for non-financial reasons (it's Columbus Day), there are a half dozen, or so, reasons why the futures are up in the pre-open activity.

 

To begin with, there was much hoopla about the G-7 and friends who gathered this weekend to coordinate the further print of money and ways to inject it into the global financial system in something approaching a synchronized manner.  "IMF and G-7 Say: No More Lehmans" says a BusinessWeek headline.  Don't tell them the last remaining US investment banks have already fled the scene, taking up the cloak of regular bankers.  Sheesh! 

 

And the 'regular bankers' who didn't cause the crisis can hardly wait till tomorrow morning when "Hank's Your Buddy" Paulson's minions will start buying stock of banks.  Gosh, do you think financial stocks might rally as the government steps in as the next 'greater fools' in owning paper assets? 

 

This crooked banker scam has been such a rousing success in the US that bankers in Europe have taken their cue as "European leaders agree on taxpayer buyout plan."   Stories are swirling about layoffs in the banking sector as a result. 

 

Did you notice this little gem of spin?  When the US Fed sloshes money into Bank Bailouts, it's called a 'government investment'.  When the UK does it, it's 'nationalizing banks'? 

 

The stories that are not making headlines yet are those of regular businesses which have their backs up against the wall because the suddenly-conservative in the banking world won't lend money to their traditional best customers.  As a result, companies are getting behind on rents and payrolls - things that tend to cascade outward.

 

The Detroit Free Press headlines that America's "Middle class finds itself buried in debt; simple misfortunes make bills pile up quickly"

 

This administration continues to solve the wrong problem:  Mortgage relief and debt relief is scant and distant compared with what's been done for the Banking Class.  The public outage continues to build at the arrogance of Washington ignoring the clear Will of the People. 

 

It's not like I'm alone sensing it.  Go read Ben Stein's (Money) story in the NY Times this weekend:  "Fear and Loathing in La Jolla."   Stein's piece is very well-written and in touch with what we call around here "Street Level Economics".  So much so that he actually uses the "R" word at the tail end of the piece:

"Frankly, I don’t know the answer. I just know that for a long time, we have paid Wall Street “experts” unimaginable sums for preparing for our retirement. They still have our money, and we have ashes. And I wonder whose side government is on, which is a bad thought to have, and I wish I didn’t have it. As the song goes, there is revolution in the air."

"R" word, got it?  That's the one word linguistically that'll be simmering for the next six months before boiling over into the Summer of Hell in 2009.  Just notice as it percolates around gathering use and context in your life for the next six months.

 

But the MainStreamMedia's message this particular Monday is that "Everything is good.  Remain calm.  Wall Street will now Rally."  About the only thing that's missing is some fool off on the sidelines yelling "Good times are just ahead" - the mantra of the early days of the previous Depression.

 

As I shared with Peoplenomics.com subscribers this weekend, the timing of a bounce should be absolutely evident in this chart:

 

If the Replay of 1929 continues, we should rally back to about 10,200 if I'm eyeing it right.  Rally into the election?  So that's where the $1.5-trillion went, huh?

---

The government buying up stock on the open market this week is not the only evidence that elections must be near in the Checkbook Republic.

 

Nossir:  The Tax, War, and Oil Party has arranged for the price of gasoline to come down.  In a weekly report out Sunday, the price of regular is closing in on $3 a gallon.  This is evidence of what?

Ure's Economic Axiom 437: The price of gasoline is  proportional to the number of days till the next election of folks who can influence energy policy.

In the Big Picture, we notice that OPEC is calling a meeting to discuss cutting their oil production quotas in order to hold prices high, but gosh, how coincidental; the meeting won't be till November 18th in Vienna.  With an election over by then, they should be free to bump prices (via quotas) to whatever they feel like. 

---

The Washington Post's Electoral Vote Map shows Barack Obama with a decent lead over John McPalin. But there's still three weeks to go.

 

Too bad the "Campaigns Turn Nasty".  But nasty's a great substitution for content and substantive, thoughtful discussions for a majority of the flock (of sheep).

 

I'm betting the Oil Party will get gas down to $2.75 a gallon before polling, gambling that your memory will be poor enough you'll overlook which party has out-socialized, self-employment taxed, and warred us into financial ruin.  Niice of you to bail out insurance companies and banks for 'em, though...

---

Despite the belief of their followers that either presidential wannabe will make a difference, I don't see it.  I'm planning to vote third party all the way this year.  Not that it will change anything, but at least it may register somewhere that at least one voter in Texas ain't buying the same old crap again this time.

 

The Friedrich Hayek cartoon series "The Road to Serfdom" seems apropos.

 

The Meatball (or dead cat) Bounce

European, Asian markets bounce back.  Gosh, look surprised.  Doesn't change our long-term outlook, so revel in it while you can.

 

Economy May Be Screwed But...

"Prostitution has not suffered drop-off despite economic meltdown." reports the NY Daily News.

 

The Week Ahead

After the market gets out of rally mode (which it should be in at the open this morning), there will be items like the Producer Price Index out on Wednesday and then Thursday we get new Consumer Price Index numbers.  The Housing Start will be out Friday.  I dropped the 's' from that on purpose...

 

Call Smokey

A forest fire has charred more than 2,000 acres near L.A.

 

Chillun'

Boise Idaho has gotten its earlier snowfall on record.  Global whating?

---

Exotic climate studies see people moving to the Antarctic...

 

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Coping: There Goes Healthcare

As if we didn't suspect this all along, a letter from a reader, who happens to be a doctor practicing medicine in the nation's capitol, underscores how a lack of money is hurting people down at the physical well-being level:

"Hello George,

I just stumbled onto your Street Level Economics site and wanted to contribute.

I've labeled this "Washington II" because the last contribution was from Washington state, which is where I am as well. Just coincidence.  

I'm in health care and I read recently that of all sectors of the economy, health care is suffering the least.

Is it?

I've had patients cancel appointments beginning about two months ago with the reason given "I can't afford the co-pay." My volume has dropped dramatically and have noted that accounts receivable is very high, as checks from insurance companies are being delayed.

Of late I have for all intents and purposes stopped accepting insurance cases unless they happen to be work or accident-related, but even these cases are becoming "iffy".

Too many patients have mentioned to me they need care but simply cannot afford it. For every one person actually brave enough to voice their frustrations, I know there are hundreds or perhaps thousands who are in the same position but suffer in silence.

We are in for some difficult times, I'm afraid."

Yeah, we knew that would come along, sooner or later...

 

Poison for Your Teeth Department

I haven't been a fan of fluoride tooth treatments for a good long while, and I've never seen why after a couple of million years of human history without it, we more or less suddenly in modern times need to add stannous poison to our toothpaste.

 

A reader sent along a link to a story that a new "Govt. report says Fluoride added to Water Supply May Harm Population" along with this note: "DUHHHHHHHH...."

 

Worth reading, especially if you're working on meditation and opening your third eye/pineal gland, is this article: "The effect of Fluoride on the Physiology of the Pineal Gland."

 

Elaine & I both use fluoride-free mouth care products, for what should be obvious reasons.

 

Holes in Our Knowledge

As Zeus the Cat was demanding I take a break from writing for a few minutes to give him his morning pets, it occurred to me that despite umpteen years of school, there are still gaping holes in my knowledge about life.  I realized that I didn't know why cats purr.

 

Oh sure, I know that if Zeus gets petted, he purrs quite loudly.  And, when he wants either food, or a cat treat, he'll rub this way and that.  But that doesn't get to the why part.

 

Looked up a Scientific American note on purring...seems that purring in communication of some kind, but also may have some self-healing aspects.

 

Made a note to myself next time I get a cold, or sore muscles from working hard, to try purring.  Ran it by Zeus, and he simply offered his usual "George is crazy, but a decent servant" look and went outside on mouse patrol, muttering to himself something I didn't quite catch...

 

Ditch Weed, Save the Environment?

Don't bogart that park, my friend: "Officials: Mexican pot growers are polluting American Wilderness" says a report out over the weekend. 

 

You know, such environmental problems would be solved if weed was decriminalized and if people could grow their own for personal use.  Of course, that would put a huge hole in liquor taxes and the substance abuse industry...so guess that's not going to happen....just a thought...

 

Punishment Fitting the Crime

A judge in Urbana, Ohio, was singled out for praise by a reader who pointed us at this story about the punishment for loud rap music being classical music... music to our ears...

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Around the Ranch

My visiting younger sister has been in training under Panama Bates' tutelage, to be 'Emma Peel'.  She's getting to be a fair shot with the Glock, although I prefer my Ruger - a little more heft.

 

Something she didn't realize - and many people who are weekend shooters don't- is the difference in trajectories between rifle and hand gun rounds.  A pistol round  when fired begins to sink right away.  A rifle round, on the other hand, will rise as much as several inches before falling.  You can read up on it here and find the adjustments for many popular calibers.  Typical Army training is to battle sight at 75 yards and then remember to aim low for intermediate ranges beyond that.

 

Easiest way to keep it straight for me, since my long range shooting is most always 7.62X39 in the AK and SKS's has been to remember "all threes".  At 333 feet (110 yards) a 7.62 round will rise about 3", so aim 3" lower than target center. 

 

Panama is one of those Ranger & SF 'one shot, one kill' guys.  I tend to be more a 'spray and pray' type,  believing if you put enough lead down range, something will be hit or whatever's out there will be run off by the noise.

 

That was the fun part of the weekend - pistol plinking is fun, but less impressive than bump-firing an AK.  (video of bump-firing here).  If you're good at Morse code, you can actually pull a trigger as fast as bump-firing, and it's a lot more safe, not to mention accurate. Bump-firing is not recommended.

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The un-fun part of the weekend was slicing my left index finger open while cutting plasterboard.  Not a life-threatening dumb move on my part.  However, if you see more than the normal number of typos this week, it's because the Band-Aid on the finger gets in the way.  At last!  Something to balme!

 

Another helpful home handy-bastard tip: Don't put a hunk of gauze and duct tape on a sliced finger and then use the same finger to start plasterboard screws.  Eventually, one of the screws will catch the gauze and screw it off your finger and into the wall.

 

Fortunately, Emma Peel and the OSHA inspector (Elaine) were in town shopping at the time.  Don't tell...they're too busy doing the 78th interior design iteration in the house to read the column. Sometimes, it's like trying to build a bridge to a distant shore that keeps moving, so no hurry on most projects...eventually it'll come back to what I am aiming for - the trick will be to finish things at that instant before it drifts off again...