Updated:   Friday February 13, 2004
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*****

Mattel: Selling Singlehood?

OK, here's the shocker of the week.  After 43 years, Ken and Barbie are going separate ways.  That's right.  Mattel (you can tell, it's swell) is ditching Ken for a semi-guy named "Blaine".  Read all about it:  http://news.bbc.co.uk/1/hi/world/americas/3484949.stm  What Mattel hasn't come out with is the PC Guide to post-Barbie behavior for Ken and Blaine.  Let's see if we can help, OK?

Forget Greenspan and the crash WalBuck.  Forget nukes and evil doers seeking retribution against infidels.  Barbie and Ken have split the sheets for heaven's sake.  I look for Mattel, with a keen eye for profits  to come out with a Lawyer Doll next (play with it for $200/hour) ...or maybe a cop doll (you have the right to remain plastic...), either of which could enforce the peace between Barbie and Ken.  After 43 years, Ken and Barbie don't seem to have aged.  All relationships should be this good.

 

But let me ask you:  "Is it any wonder kids are so screwed up?  What the hell kind of message is bouncing Ken sending?" 

 

Russia: Gunpoint Democracy

Ivan Rybkin is not hanging out in Russia till after the elections.  Why?  http://news.bbc.co.uk/1/hi/world/europe/3485971.stm He's afraid for his life.  Hinting that it's not safe for anyone to oppose the "order" of the new Russia. We wonder if John Kerry will read anything into this story, or if being in Skull and Bones ("We won't talk about it." - GWB) somehow insulates him a bit...

 

Bet He Won't Talk

The 9/11 Panel is asking Bush and Clinton to testify publicly: http://www.cnn.com/2004/ALLPOLITICS/02/12/911.commission.ap/  Bet me they won't...

 

HellaBurning in Hot Water - Again...

Vice President Oil's old buddies at Halliburton are being accused or overcharging the US military - which means us poor taxpayers - for work done in Iraq.  http://english.aljazeera.net/NR/exeres/DA652664-75A8-4DA5-8427-D51AB7318D4A.htm  Frankly, $7.50 for an embroidered towel doesn't sound bad, as I noticed towels in "Food and Wine" the other day going for about three times that.  Still, $7K a month for a vehicle lease sounds a bit rich for us, even in our palatial Texan lifestyle living in the workshop while the house is rebuilt...

 

No WMD's in '02?

http://usatoday.printthis.clickability.com/pt/cpt?action=cpt&title=USATODAY.com+-+Iraq+arms+hunt+in+doubt+in+%2702&expire=&urlID=9280127&fb=Y&url=http%3A%2F%2Fwww.usatoday.com%2Fnews%2Fwashington%2F2004-02-12-wmd-hunt_x.htm&partnerID=1660  Oh well, we still wanted the oil, right?

 

Thursday

Nuclear Friday?

I don't usually go looking for things to worry about, but for some reason tomorrow's Friday the 13th date just sort of "feels" like a good day to be worried. There are just too many pieces of news and intelligence that are mounting up.  A lot of times when I see a "swirling of news events" something happens.  I don't know what to expect, but here are the highlights:

Now let me give you two more pieces that go into this puzzle (or is it more a gazpacho?):  There's a report out this morning from the AP that outlines the contents of a letter purportedly sent from al Qaida's leadership to the rank and file: http://ap.tbo.com/ap/breaking/MGAPP85QKQD.html Note the one key sentence that jumps out as underscoring what we talked about earlier this week (below), specifically the reference to the Crusades, which I believe reveals the true mindset of the Islamic militants.  Refering to American's in Iraq, the letter translation goes:

"We know for a fact that that these crusader forces will go tomorrow or the day after, but anyone aware of the reality will see how hurriedly the enemy is forming the police and army, which have begun to take over its duties. That enemy is made up of rejectionists (Shiites) and augmented by Sunni collaborators and is the real danger we face. They are our cousins and they know our ins and outs and they are more cunning than their crusader masters."

Crusade?  Crusaders?  And who ran those and what dates are important to them?  Let's sketch in the role of the the Knights Templar.  A quick search will yield the involvement of the Templars in the Crusades at sites like http://www.ordotempli.org/fourth_crusade.htm.

 

All of which would be interesting, but just an odd coincidence of news events, until we plug in the last bit of history.  From the site http://www.infoplease.com/spot/friday13th.html we'll fill in the last piece of the puzzle:

"During the Middle Ages, the superstition against Friday the 13th grew. On Friday, October 13, 1307, King Philip IV of France ordered the arrests of Jaques de Molay, Grand Master of the Knights Templars and sixty of his senior knights in Paris. Thousands of others were arrested elsewhere in the country. After employing torture techniques to compel the Templars to "confess" to wrongdoing, most were eventually executed and sympathizers of the Templars condemned Friday the 13th as an evil day. Over time a large body of literature and folk wisdom have reinforced the belief. In the 18th century, the HMS Friday was launched on Friday the 13th. It was never heard from again. Since then, ships are not usually launched on that date. (Click here for other mysterious ship disappearances.)"

Thus, if I were commanding the U.S. Nuclear Emergency Search Teams, I would have every radiation detector I could get my hands on searching areas around big cities and critical infrastructures today and tomorrow.  Especially around ports. 

 

Today, rather than worry about minor perturbations in stock and precious metal prices, we'll be content to sit back and stare at the larger picture.  I don't think it would be out of the question for the forces of al Qaida to attempt a further punishment of the Crusader/Templars on a Friday the 13th.

 

I certainly hope not, but it would fit.

 

 

Wednesday

Revenue Desperados

Eyeing Eisner?  Gobbling Goofy?  Maximize Mickey?  Wire Disney World?  What the hell is Comcast thinking?  OK, here's the story in a nutshell as I see it - and I don't pretend to be a stock analyst.  The big story of the day is that Comcast is trying to get Disney in an all stock deal.  And, at least hyperficially, there's  a case to be made.  At a market cap of  $60.8 billion, http://finance.yahoo.com/q/ks?s=DIS Disney seems the junior of Comcast's $100.5 billion cap. http://finance.yahoo.com/q/ks?s=CMCSA  Makes sense, right?

 

Well, not really. 

 

Drop down those same statistics a big and you'll find the number that Comcast is really eyeing.  REVENUE.  Despite all the hype, Comcast has trailing twelve month revenues (TTM) of $19.12 billion.  By the same measure, Disney produced $27 billion on the same basis.  Getting the picture?

 

In order to maintain its rich P/E, Comcast has to figure out how to grow its business.  Knowing full well that government regulation is likely to constrain cable revenue growth, and what isn't constrained will be hemmed in by DirecTV and Dish Network.  So how does a profit starved old technology company like Comcast, which has been losing money, make itself look attractive?

 

Buy revenue. 

 

To offer to "buy" Disney by printing up paper (called stock) seems to us to be the kind of shareholder grandstanding so typical of the late stages of a bubble. 

 

My take on the whole deal?  This is one of those transactions where a corporation is making an important transition from being a core business enterprise to a "we don't care where we get money, but we're gonna make money" global corporation. 

 

Further study says Comcast is bled out -$408 million free cashflow in the most recent 12 months, while Disney generated $1.85 billion. Comcast is buying a tourniquet and a revenue stream.  And doing it by creating more paper.  To me, it looks like a Mickey Mouse deal.

 

Jobjacking is Good?

A fine example of garbage in, garbage out today from the President's Council of Economic Advisors.  They has issued a 400+ page "report" that tries to explain how outsourcing (e.g. sending what should be U.S. jobs to India and other least cost nations) is a good thing.  Take a good stiff drink first and click over to http://www.post-gazette.com/pg/04041/271362.stm and see if you can figure out just how stealing American jobs so India can have an 8.1% growth rate while 90,000 a week are at the end of their unemployment in the U.S. is a good thing?  Seriously, if you can explain it, let me know?

 

Letter of the Day #1

From a hawkeyed, clear thinking reader:

Hey George!

Bankers most likely to seek erectile dysfunction advice: Study "What we found was people in the finance sector like stockbrokers, bankers, accountants were the ones who were ... beating down the door of their GPs to talk about their erectile dysfunction problems," Carroll said.

http://www.hindustantimes.com/news/181_567645,0050.htm 

Yup, what do they expect after screwing the public and society at large for eight to ten hours a day, there's nothing left for Momma or Girlfriend! See what happens to ya when you have a ** for the world? LOL  (It certainly would explain why bank customers get the short end at the bank all the time... -G)

Who says there's no justice in this world?

Letter of the Day #2

From another reader:

You stated “In the Islamic world it is not forgotten that the Christian West invaded the Middle East with devastating results in ancient times.”. Well how about the fact that the Jews and Christians were there before the Muslims? As a matter of fact the Jews and Christians were there before there were Muslims! The Muslims conquered the Middle East and the Christians were just taking it back. So give me a break with the with this sympathy garbage of something that happened 1,000 years ago!. Talk about digging for excuses! I agree with you on most things but “you got my goat” as we Texans say, with this one! Oh, this guy doesn’t agree with you that it was such a big deal http://www.islamicity.com/mosque/ihame/Sec10.htm .

The point I was making was not about "who was where first", it was that the militant Islamists do "remember" the Crusades.  Where the unnamed author of the referenced site says "To Arab historians, the Crusaders were a minor irritant,"  I'd like to know what "Arab historians" he's talking about because I'm really clear on what I'm referencing - it's not historians, it's militants who want to kill infidels and brand Americans as infidels.  Moreover, consider that in 1098 at the fall of Antioch, 100,000 Muslims were killed, which given the smaller populations of the time, is like a nuke over NY in modern terms. If you count all the deaths, you get around 1.5 million dead, and that's from a small population base.  Certainly only a fraction were Muslim, but stay with me on the point:

 

Count the references about the Crusades and/or Crusaders in any bin Laden rap.  Moreover, he writes in a form peculiar to the 1300's.  There's an old martial arts phrase that if you lose your respect for your enemy, you have lost.  The Arab historians did not kill 3,000 people on 9/11.  A bunch of militant Islamists who reference the Crusades almost every time they communicate, did. Count the words infidel and crusader...my point is the Crusades are realtime in their minds.

 

Maybe THIS Quake

It looks like our China quake may have landed on the Middle East vertex, but only time will resolve this.  But the timing is close. http://www.haaretzdaily.com/hasen/spages/393241.html  Still, a China quake would not really surprise us - especially around the 13-14th.

 

Civil War in Iraq

As we were saying yesterday about Iraq descending into civil war: http://news.independent.co.uk/world/middle_east/story.jsp?story=490057.

 

Meantime, that freedom-driven U.S. installed government in Iraq has managed to freeze the Iraqi passport offices, so if an Iraqi wants to leave the country, they can't:  http://english.aljazeera.net/NR/exeres/5C1E4BDF-6C63-4F6C-861D-70F844E81D2C.htm.  One more step down the ladder into hell.

 

China Plays Along

China looks like it is being into the G-7's "please let's not rock the boat just now" statement.  Check out the pledge that the Yuan will remain "basically stable" at the People's Daily site: http://english.peopledaily.com.cn/200402/11/eng20040211_134532.shtml.

 

Wednesday

Iraq: Civil War Next

As we wait for our predicted 7.5-8.5 earthquake in China south of Beijing later this week, we've been watching the deteriorating situation in Iraq with increasing concern.  Today a bomb which may ultimately kill more than 50 people has exploded http://news.bbc.co.uk/1/hi/world/middle_east/3475679.stm in what continues to evolve as a major civil war centered around religious extremism, and continuously funded by Arab sources funneling money to the militants of Islam including Saudi-based groups like al Qaida.  Because the U.S. has some much firepower in the cities such as Baghdad, we won't see the outright fighting there, but I think we'll continue to see increasing numbers of bombings which will cast a serious doubt on the veracity of any "elections" which continue to look like a train wreck in waiting.

 

As the civil war unfolds, as is noted in this report from al Jazeera, http://english.aljazeera.net/NR/exeres/4A325F43-3F0E-4C09-AE67-080953E4BBD0.htm, we should expect the sparsely inhabited areas of Northern Iraq as the locus of conflict, with the spread to the south over time as the separatist factions harden their positions and "dig in".

 

It's all part of what we have characterized for Inside Report Readers as the "Manufacturer's Resource Wars".  This will be a 30-40 year period getting underway during George Bush 1"s tenure, where the industrialized nations of the West launch energy  and resource "crusades".  These crusades are being driven by a lifestyle and economy that has failed to come to terms with four key unsustainable trends:

So it is that when we see stories like this morning's piece from Reuters announcing that chain store sales are down because of the unusually harsh weather, http://biz.yahoo.com/rb/040203/economy_retail_icsc_2.html, we sit back from our resume hustling and reflect on the larger problems of the world. Specifically, an economic system that has bumped up against global size limits.

 

In order for Western Capitalism to function as a healthy system, it needs expansion room and resources.  Constrain either and you tank the economy, or as the present period of economic history suggests, you foment wars and grab resources in hopes of avoiding the Greater Depression that now threatens. 

 

While free-for-all capitalism was great for building America, and would have worked for sustaining America without massive people-replacement strategies like outsourcing/jobjacking, mass production, and robotics, the emergence of people-replacement calls for a new kind of economics. 

 

The Global Minimum Wage Petition

 

I think the answer lies in a global labor standard.  Imagine for a moment the millions of jobs that would return to America is all those outsourced jobs to India sudden had to be paid a purchasing parity power equivalent to the U.S. Minimum Wage.  I am actually thinking about an initiative to require just that.  It would be a simple initiative that would read something like this:

"I _________________,a Citizen of the United States of America, hereby demand all workers producing goods which are imported to the U.S. whether physically or electronically, be paid the purchasing power parity of the U.S. Minimum Wage.  This would require that workers in India, Malaysia, and other countries where workers are exploited to the detriment of American jobs must be paid enough to buy a brand new vehicle every year, or buy a new home equivalent in size and features to a U.S. home on five years of wages.  In the event a country can not document purchasing power parity for its workers, the U.S. government shall levy a labor tax on such imported goods and the revenue from such tax shall specifically fund U.S. unemployment programs, job creation programs, and to reduce the U.S. income tax for all workers with AGI's of less than $100,000 per year. I recognize that there will be economic adjustments required by this demand, so in order to give corporations time to react, I will accept a maximum of a five year phase-in for such a program, phasing in at $1/hour per year effective immediately.

Yup, this is the answer to jobjacking, but it's a corporation nightmare.  Thus, the bought-and-paid-for Congress is not likely to adopt such a "field leveling" way to advance the global good, but it sure makes sense to at least one unemployed economist/sales guru in Texas.  Comments?

 

Was Bush AWOL?

That's getting to be a pretty interesting discussion.  Good story in the Washington post today about the quest for GWB's service records which so far have not appeared: http://www.washingtonpost.com/ac2/wp-dyn/A26843-2004Feb9?language=printer.

 

Who Ratted Out the Company?

Latest on the CIA leak probe: http://www.washingtonpost.com/ac2/wp-dyn/A26979-2004Feb9?language=printer.

 

Monday

Updated Quake Prediction 4:15 PM CST

Click over to my colleague Cliff's site: http://www.halfpasthuman.com/HPHUE_EQ29214.htm

Osama's Nukes?

There's a report this morning from an Israeli media outlet that says al Qaida has had tactical nuclear weapons for about six years. http://www.haaretz.com/hasen/spages/392006.html.  There are two ways of looking at this most serious of reports.  One is that it's not true, and evidence of this could be that they haven't been used yet.  "These guys are not going to sit around with unspent WMD's" is one thought.

 

On the other hand, there are those conspiracy theorists who believe that as JFK2  ( http://news.bbc.co.uk/1/hi/world/americas/3471143.stm ) rises to take out GWB in the fall elections that the incumbent will allow "something" massive to occur in order to remain in power for another term. 

 

We won't waste your valuable time trying to dissect it any further, except to note that the whole truth about 9/11 is not out yet, and with Condi Rice's secret, unpublic and unsworn testimony over the weekend, we're probably not going to get the truth, just as GWB's hand-picked - but somehow supposedly impartial - panel won't report on the Iraqi WMD claims till safely past election day.  The latest Zogby Poll shows Bush approval (blue line) falling:

 

 

We could  be concerned when negatives about Bush are stronger than positives.  But, what we will instead focus on is that the report is making the rounds and coupled with other items we can go into publicly, gives us cause again to believe that we're in a lead-up period prior to another attack, one which will likely be larger than 9/11 both in terms of size and body count.

 

Double Standard  in Policies

We note with interest the administration's non-reaction to the violence breaking out in seething Haiti.  http://ap.tbo.com/ap/breaking/MGA2I4ZGGQD.html  Our interest lies in the fact that when similar incidents happened in oil-rich African countries there was an international hue and cry.  Say, that's not a double standard, is it?

 

Oil Hold Up

The president of OPEC is rallying the oil "haves" not to exceed production quotas, lest the price of oil quickly fall once the unseasonably cold weather passes in a month or two: http://ap.tbo.com/ap/breaking/MGA2JC7KGQD.html. 

 

Iraq In Dark

Here we are, how many months past the invasion of Iraq?  And the lights aren't on there?  http://ap.tbo.com/ap/breaking/MGAI0Q8JGQD.html  One more reason why we think elections in Iraq are a train wreck in waiting.

 

Sunday PM

EGGS Go Nuts - Bots Tremble

What's Coming This Week?

The note from my colleague Cliff says it all:

the eggs are saying something wicked this way comes....

http://noosphere.princeton.edu/bsktobsrv/nishith/basketobserver.html#Display

What are the danger signs?  Let's summarize them:

Our best guess:  A huge earthquake would certainly fill the bill.

Add to that the afternoon's (Sunday) outputs from the Princeton noosphere and you get a very ugly week, and the longer it's pushed out in the week, the uglier it's likely to be.

OK, so our house was partially burned out.  I'm glad as hell to be in rural Texas with a month of food stored, our own water, and enough propane for two years of heating.  I wouldn't want to be in Algeria or any other quake prone place this week, thanks. 

Translation of the G-7 Statement

The real meaning is in blue

The global economic recovery has strengthened significantly since our meeting in Dubai and risks have diminished. OK, so the U.S. recovery is weak, there's enough growth elsewhere for now. Growth projections for 2004 have been revised upward to their highest in three years. You're supposed to forget the global contraction that has been ongoing since the dotcom bubble burst globally in the summer of 2000.  Sing along with us, the "recovery is underway...".  Fiscal and monetary policies have helped bring about these welcome changes. The U.S. dollar has weakened and outsourcing has been great for lesser nations.

Yet much more remains to be done. But we're still greedy.   The pace of growth among our economies remains uneven. Some of our members didn't think they got their share of the global pie. In our Agenda for Growth initiative, we emphasize supply-side structural policies that increase flexibility and raise productivity growth and employment. We don't care about demand side, we're working on supply issues like outsourcing.  Today we released a progress report on our Agenda for Growth. This agenda and sound fiscal policies over the medium term are key to addressing global current account imbalances. We are studying and worried about the US balance of trade deficit, but let's not name names, shall we?  We outlined strategies for sustained medium-term fiscal consolidation as economies recover. We don't know if this is really a recovery or just a readjustment, but if it's a recovery, we want the U.S. to act more responsibly.  International trade is vital; we call for further efforts and for countries to take the steps to resume the Doha round, which is pivotal to global growth and the alleviation of world poverty. Of course, as global corporatists, we wanted a no-rules world with cheap labor everywhere and we expect the U.S. to ignore the jobjacking issue.

We reaffirm that exchange rates should reflect economic fundamentals. It's OK with us to let the U.S. dollar fall.  Excess volatility and disorderly movements in exchange rates are undesirable for economic growth. But, we want the fall to be gradual.  We continue to monitor exchange markets closely and cooperate as appropriate. To some extent, we'll try to keep the game rigged.  In this context, we emphasize that more flexibility in exchange rates is desirable for major countries or economic areas that lack such flexibility to promote smooth and widespread adjustments in the international financial system, based on market mechanisms. U.S. rates should be set based on market mechanisms and if the buck falls, tough.

To combat terrorist financing, we urge all countries to strengthen their asset freezing regimes and to combat abuse of the informal financial sector and non-profit organizations. As Western Corporatists, we will use the cloak of "protection from terror" to fight resurgent Islamic fundamentalism.  It's an easy way to steal money. Wink. We know the Saudis are the problem, but they have oil and we run their government now, so let's go after other "enemies" of the Saudi installed government.  The IMF/World Bank should make permanent and comprehensive their assessments of countries' efforts to combat terrorism. And we'd like the IMF/World bank to help us take more.

We are committed to further enhance transparency and supervisory standards in financial markets, in particular non- compliant offshore centers. As corporatists, we don't like the Channel Island, Cayman Island, Turks and Caicos, or Swiss bank secrecy.  That should only apply to our own personal accounts.

We have a shared interest in seeing strengthened economic growth in the greater Middle East. We know the Middle East will blow up if the Western bought governments don't share more with the people they rule.  So let's pass out some goodies.  Cake is good.  So's pork.  We had a productive meeting with our counterparts from Afghanistan and Iraq. Those newly installed U.S. governments in Iraq and Afghanistan want to play ball, and we're glad of it.  We welcome the completion of the currency exchange in Iraq and the removal of interest rate controls, and we look forward to the approval of the new central bank law. We welcome progress on reform and reconstruction in Afghanistan and the renewed efforts to collect revenues from the provinces. Oh, and that new gas pipeline Unocal has been pimping since when should become real so we will get a payback there.  We call on others to join us in reducing the debt burdens of Iraq and Afghanistan. We think American taxpayers can be stuck with the bill for our plans. We welcome the plans of the IMF and the World Bank to provide financial and technical assistance to Iraq and Afghanistan. And to make it more fun, we will tie up assets of these countries with the help and aid of our puppet banksters.

Yours truly,  the guys paying the piper and calling your tunes. 

 

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George Ure

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