Once upon a time I had grand designs on sleeping in Saturday mornings, but that was before the FDIC got into the habit of posting the latest closed bank information either very, very late Friday, or early Saturday morning. Not counting ATM’s and online banking operations, since the fall of IndyMac last year, we have not seen 3,684 branches closed or reorganized into other operations (mostly the latter) including the 30 branches of the following which are going through reorg this weekend:
|Brickwell Community Bank|
|Corus Bank, N.A.|
In fairness, we’re in what passes for ‘normal’ in this French Revolution of banking: So far this year we have only seen 1,077 branched reorg’ed, but if we don’t count the 800-pound gorilla that failed last year (Washington Mutual/2,239 branches) the numbers for last year wouldn’t seem so bad, either.
Looking ahead to next week, market watching could turn back into a nearly fulltime avocation since insiders have reportedly been selling at a furious pace and that usually translate to “strong hands’ holdings are being distributed to weaker hands – namely people still courageous (or foolish) enough to trust 401 (k) stock holdings to keep their retirement dreams alive.
Not that throwing a couple of bucks in the direction of new technologies would be a bad thing, if your investment horizon was on the order of 20-30 years. Ameri9ca’s still a great country and the largest consumer nation on the planet. While that’s likely to change over the next couple of years, there may be the odd winner in high/new tech.
On the other hand, investors over 50 (of which we are two, Elaine and me) might wish to be far more focused on maintenance of purchasing power for those few dollars which made it through the 2000-2001 Tech Wreck. The chart no one on Wall Street is holding up is the one which shows performance of a portfolio that was comprised of equal parts Dow, S&P 500, and NASDAQ Composite since 2000. (it’s here). As you’ll see, it’s nowhere near equality with 2000′s purchasing power.
The amount of dough and what it will buy these days might have been augmented by the odd dividend or split along the way, but in many cases the fund management fees which I’d insist on taking into account if we’re drilling down into the sludge, usually eat those – and a lot more.
Even though I’ve read a fair bit about economic depressions in the course of my study of the subject which dates back to my news-chasing days in the early7 1970′s, I haven’t read it all. But reading about human foibles in days past can be a pretty good predictor of how humans will react in the present day as well as the future.
While Ben Bernanke’s assessment of the Great Depression ( Essays on the Great Depression ) read to me more like “Quest for the Magic Bullet” – in other words, what were the formulas that worked during the first Great Depression – a less formulaic starting point if you’re new to such research might be Charles Kindleberger’s Manias, Panics, and Crashes: A History of Financial Crises (Wiley Investment Classics).
Since we’ve got a fair bit of rain going here in East Texas this weekend, I’ve decided to settle in with about equal parts of The Panic of 1907: Lessons Learned from the Market’s Perfect Storm by Robert Bruner and Sean Carr and Pilot’s Handbook of Aeronautical Knowledge: FAA-H-8083-25A (FAA Handbooks), rereading of which I’ve assigned myself in order to get the most out of my biennial flight review.
Speaking of books, my brother-in-law read the first few chapters of my novel-in-progress, “Dimension Barrier” and pronounced “Too many facts.” What I’m aiming for is a middle ground between Clive Cussler for just damn fine storytelling on the one hand and Tom Clancy for accuracy of technology slinging. Not that writing a novel takes much time when it’s all done in a lump, but like so much else in life it’s the start-up, quit, and res-start sequencing that seems to be the most difficult. Just too damn many hobbies.
But that’s what rattles around between my ears early on Saturday morning when only the cats and I are up: I wonder “What would the French Revolution have looked like if it had been played with falling credit card limits instead of falling guillotines? The effect is to kill people one way or the other, just one is more subtle and the process quite protracted.
I’ve intellectualized away attendance at stock car races, motorcycle road races and even air shows with high aerobatic content figuring that what brings people to such events is the prospect of death. Nevertheless, here I am on Saturday morning clicking on the FDIC web site. I’m sure there’s a difference, but putting into words seems difficult, especially when I’ve got a clue as to the plight of homeless when the rains come – and it’s still a long ways till winter.
So instead I’ll try to encapsulate it as “Saturday morning at the guillotine” and suggest that the current financial revolution is likely to take even longer than the 10-years of the French Revolution so a few same-old Saturdays can be expected along the way.
I’d best leave it as a weekend ponder for you: sorting outing which is (or was) closer to the people: Washington over the past 10-years or Versailles?
I’ll be the guy with the “Vote ‘Em All OUT” sticker…
The Dow closed Friday at 9,605.41. On September 11, 2001, the Dow closed at guess what? 9,605.51. A lousy 1/10th of one point difference for 8-years of risk.
Sure as I point out something like this, some reader somewhere will shoot me an email demanding “Why don’t you take dividends and splits into account?”
The answer, you ninny, is “If you let me count delisted stocks” and oh, by the way, the dollar’s purchasing power has dropped 20.45% in the last eight years. Just so we keep apples to apples here.
Mr. Ure’s Investment Tip of the Day: If a broker, financial products salesman, or other bankster shill doesn’t show you inflation adjusted/purchasing power parity performance data don’t walk…RUN as fast as you can.
Federal Red Ink: Still Growing
Far as I can figure, eventually we get lots more inflation since the Federal Deficit “hits $1.38T through August.“
This would pencil out to a $1.505 trillion deficit at the present run rate by the time things wrap up on September 30th. And, if we assume a gross domestic product of around $13-trillion, that implies to my simple-minded way of looking at things an inflation rate (or speed of purchasing power being watered down) of 11.5%.
Eventually, the people who provide our energy and all that stuff from Asia are going to charge us higher prices since the dollars won’t buy as much. Which gets us to….
Although here in the Second Depression we don’t have something as all-encompassing as the Smoot-Hawley Tariff Act, we are starting to see the game of tit-for-tat ratchet up between the US and China.
In case you haven’t been paying attention, the Chinese decision recently that they would not require state-owned companies to honor certain financial products (derivatives) positions if they believed there was fraud in how they were sold to the Chinese, we now see the US about to impose a tariff on tires from China.
China, ‘natch, says this is “Protectionist!” Yeah, and?
Word that a presidential adviser says to expect high unemployment for years to come sounds like someone speaking for an administration that is not seriously interested in (or can’t seem to fathom the concept of) ONSHORING JOBS BACK TO THE US. Duh!
The big tire plant in Tyler, Texas wasn’t saved by this tire tariff – a couple of three years late, but then don’t start me down that path.
Next sticker: Outsource Washington!
Whoever those people are there – who seem intent on spending us into wealth – life doesn’t work that way and the surest way to create prosperity in America is to trash globalist pap and rebuild America into a self sufficient powerhouse. Globalism has never been any more or less than rich folks playing labor rate differentials and pocketing the difference. Plain as day. Ask anyone in Detroit, Ohio, or states that used to be huge manufacturing centers.
“What Does He Have?” Department
People -especially in the mainstream press, have gone to great lengths to demonize, marginalize, and ridicule Robert Mugabe of Zimbabwe. Yet this week, Mugabe held meetings with the EU for the first time in seven years.
Now, why do you suppose that is? The way I figure it, the Western resource depletion juggernaut is going to have to get serious about resource-stripping of Africa.
This shouldn’t come as a shocker if you read the piece “Hillary Clinton seeks to strengthen US imperialism’s position in Africa” last month. Nor should headlines like “AFRICOM to the rescue” more currently.
So what’s the interest in Zimbabwe? I mean besides (from the CIA World Fact Book): “coal, chromium ore, asbestos, gold, nickel, copper, iron ore, vanadium, lithium, tin, platinum group metals” and no environmental regulations and a nice central location?
My bet is on lithium – yeah, the stuff that makes new technology batteries. We’ve already seen a heightened interest in Bolivia as a resource-rich target for ‘improved relations” (which someone really cynical might read as resource-stripping).
No point onshoring anything to America, just yet, is there? Still too many outposts to build to secure longer-term resources like a good supply of lithium.
Besides, even if we don’t need all that lithium for batteries, the nearly manic US population might sooner than later need lithium carbonate added to its water supplies.
What a glorious new line of development, huh? Why just imagine progressing beyond democracy to where we won’t even have to vote, we’ll be of such a single national mind and purpose…
Is it too early for a beer?
The report that the Census Bureau was severing ties with ACORN in the 2010 Census counting comes as little surprise. Bite your tongue if you’re cobbling up “Washington” and “nuts” jokes. We try to be serious around here at least now and then.
The Alien Healthcare Wiggle
Kinda sounds like a dance, doesn’t it? Well, the White House is busy offering clarification about how much verification illegals will need before they get free healthcare anyway…
What? Gunshots on the Potomac? Run with it! Even if the facts later show it was a routine training exercise for the Coast Guard and gives the White House a chance to blame the MSM for getting a bit carried away. Such are the pressures to be firstest with the mostest in newsrooms. As good ratings, so go raises over time.
Shoot The Moon
Word that “NASA names target for water hunt at moon’s south pole” reminds me that there really are warlike aliens in space.
See you Monday morning ’bout 8 AM.
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The UrbanSurvival Mall:
Peoplenomics This Week:
Free Satellite TV: Building an Information Platform
Not to be a stick in the mud, but as much as I like to watch television as much as the next guy, I’m definitely in the came of not wanting to pay for it. At various times, we’ve had the pay TV services and it gets to be spendy – month after month and in these uncertain times promising to pay even $50 for an assortment of news and business channels mounts up. Over the usual 2-year commitment, you’re talking about as much as a couple of thousand bucks – and in some cases equipment is on top of that. What’s a guy to do? One of the answers is “Free-to-air” television. No, you won’t find the assortment of stations and no, not much out there that is HD, but that’s what NetFlix is for – the occasional good/worthwhile movie. This week’s report (since it’s a holiday weekend and all) is something other than our normal ‘grim’ fare of economic outlooks. A simple how-to which can save you a thousand dollars a year and free up 2-hours a day. The grim stuff is in the chart section.
My commodity broker JB Slear and I have written a simple book to get you started on high density hydroponics. It’s an example of how someone with a little creativity, access to a few ‘dollar stores’ and willing to try out some new farming techniques can grow an amazing amount of produce sin a very small space – like even an apartment balcony (if it gets some sunlight). Sound interesting? It’s just $10 bucks here…
No, when you tell your browser to ‘empty your cookies’ of web sites you’ve visited, it probably won’t get them all. Why? Because there is a whole class of ‘browser-independent’ cookies that will gobble up space on your hard drive, but more important is they will sneak out information about you without you being aware of it. Ever week I get emails like this one:
“Thanks again for the Maxa Tools recommendation, I never knew how much additional garbage gets attached every time I browse. “
Test drive it free by downloading it. To upgrade to full functionality will be $35 bucks. Is your privacy worth it?
Once you try it out, click the upgrade button (!) on the upper right hand side for the $35 unlock to get it to remove even those nasty and highly intrusive ‘non-browser specific’ cookies. Bonus: You computer may run faster. I’ve taken 1,000 37,970 cookies off my machine now. It’s just amazing.
Attn: Mac Drivers: MCM does support the Safari Browser, but that does not mean it is compatible with Mac OS. Maxa-Tools only support the Windows world….so far. Given Jens and the other engineers time…
Want to be a thorn in the side of the Old World Order? Simply click here and send a link to this site to everyone on your distro list…Nothing more dangerous than sharp, clear-thinking upstarts who ask a lot of questions, eh? Unless you believe WTC-7 fell over on its own, of course….
“Live on $10,000″ Updated
I’ve told you in the past to order my ebook “How to Live on $10,000 a year or less…” with the rationale that “We’re all going to live it shortly, anyway.“ Don’t know as you have looked lately, but the unemployment rate is up more than 3% since I wrote the first edition of that book and underpasses have never been more homely. Worth ordering? Just visit www.liveontenthousand.com or, click this little whizzie…
It’s an automatic download. It’s written in an information dense style: The whole thing runs about 65 pages, but it gives you a vision of how to not only live on the cheap, but also how to migrate up the economic foodchain if you have a little hustle left… Click here for the index and details.