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Published Monday - Friday about 8 AM Central Time Except Holidays....many major typos are fixed by 8:30 daily
Saturday,
April 11, 2009 17:35CDT
This site is supported by subscription to Peoplenomics. For additional content, please subscribe. Content mirrored at my other site: www.independencejournal.com,
Radio Show Delayed another couple of weeks!
Sorry - details when available...
Radio Show Reminder Well, maybe it's not a reminder since I don't know if I mentioned it before, but Cliff and I will be on Scott Stevens new radio show on the Genesis Radio Network tonight from 10-midnight Eastern, 7-9 PM Pacific and 9-11 PM here in the Republic of... --- Note to Scott Stevens: Send me the where to listen live link and I will post it!
Failure, Apparently, IS an Option Word from the FDIC is that another couple of banks have gone through federally overseen banking failure. One is the New Frontier Bank of Greely, Colorado which you can read about here. The other is Cape Fear Bank of Wilmington, North Carolina (details here). Then, if you hit the FDIC's failed bank list, you can see that so far this year, 23 banks have failed. Now, as I look at the calendar, seems to me that we're about 15-weeks into the year. That pencils out to about 1.5 bank failures per week, or extended through the balance of 2009 would put bank failures at (gulp) around 80 banks.
Our next stop in caffeine-fired Saturday morning ponderings would be to ask: "So what was last year's number, and would the current run rate annualized be better, or worse, than last year?"
Well, last year, we had 25 banks fail. Going back another year, to 2007, we had only three banks fail. There were zero closings in 2006 and again zero in 2005.
That's not the whole story; it never is in statistics. Figures beget questions.
So in the first half of 2008, what was the failure rate? Just four banks. Things didn't really start to popping until the second half of the year. In the second half of 2008 we saw 21 banks fail, which is less than one a week. So, out first observation won't be the alarmist-sounding headline that "Bank failures are running more than 300% compared with last year" - which would be true but misleading.
Instead, we compare the run rate of the second half of 2008 with the first half run rate of 2009. Closing 21 banks in 26 weeks back in 2008 means closing eight-tenths of a bank each week and an annual run rate of...(inserting more coffee here)... 42 banks per year.
Since our run rate (annualized) here in 2009 is running a shade under (say, a cheese sandwich under), we might project that bank failures will be up 89.84% this year if 1) the way into recovery works out anything like the way into Depression 2 and if 2) these are really big enough numbers to mean anything.
If it's been a while since a stats class, I won't bore you, but
for a universe of 'n' you've got to have a big enough
sample size or you just find yourself measuring noise and
outliers. Still, them
Black
Swans will beat your portfolio up whether they should
be out there or not. The nature of Black Swans, I suppose.
If you don't own a copy of The Black Swan: The Impact of the Highly Improbable
Not to rain on your parade and all, but if I had a 401(k) and if I was expecting the market to rally up toward either the 1) 9,600 level, 2) the 10,000 level, or 3) as high as the 11,243 level, I'd just be looking at worse things to come in the fall and be selling into strength. No, this is not investment advice, just something for you to think about. --- Had a longish and curious email from a reader who took me to task for my comments on the market seeming to vary by season along a predictable path. Essentially, he asked me if in the interest of disclosure why don't I put up a 'batting average' on my thoughts, and in particular look at my pattern of bullish in the spring and turning bearish by late summer.
It's an interesting idea, but one (unfortunately) I don't have time for. For openers, I have so much else to do that it would fall somewhere down around polishing the lug nuts on my pick-up on the priority list. If I was going to do any kind of statistically 'justifying' I'd be doing it on the web bot project which although it makes all kinds of mistakes, I'd note that this week's pirate case is a huge bot hit as was the Obama administration talking about injecting pollution into the atmosphere...both of which were presages in multiple linguistic reports, as subscribers to ALTA 909, and 1309 already know.
But here again, I'm not interested in 'justifying' anything. After questioning the veracity of my reporting on 'them winds' and such, then wondering if I was a part of the 'disinformation network itself' the challenging reader wrapped up with:
I don't. Bait & time sink is where I'd slot it. As to the spring versus fall change of tone/emphasis? Anyone who has studied markets over a multiple years knows that the best (reliability) of rallies occur it's in the spring with a low prior to Easter and exiting prior to the Indy 500. And the dumps, when they happen, cluster in the late September to end-of-year period.
Moreover, I've been talking about my 'spring rally' expectations since December. If you want to compile your own stats, have fun. --- The federal budget deficit numbers are out. $192.3 billion deeper in debt for March. While the administration is whistling in the graveyard at $1.75 trillion deeper in debt, the March run rate annualized would dig a $2.3 trillion deeper hole, and oh, by the way, if the economy does a $14 trillion GDP this year, that would mean we're spending what? Something like 16.4% more than the whole country makes all year?
Gotta love those bankers and 'too big to fail' types.
As Colombo used to say in the TV show..."There's just one bothering me mam..." Isn't failure still an option?
For Subscribers Speaking of Peoplenomics subscribers...got a real treat in the offing for tomorrow's report. My 'consigliore' has been generous to write up his whole model of how various cycles of history interact and we'll be posting that in Sunday's report (if he keeps on writing, LOL). Any time a lawyer/CPA who has been part of the old Colorado Long Waves discussion group offers to pen the Magnum Opus on cycles, it's got my attention - should be a good one...
AmRev II or Some Other Label? You saw where a group out in Stockton, California is planning an armed citizen militia, which might be activated and patrol the city if police get laid off in numbers due to budget crunching? Speaking of which...
New Concept: Astroturf "What's Astroturf's new meaning," you're wondering? Well, according to TheBondDude (who is seldom wrong, unfortunately) it is "The name for mass corporate marketing disguised as grassroots efforts by individuals..." A link related...
Burning Down Towns The wild fires in North Texas have burned down two towns, although there's some hope in today's forecast that winds will die down so fire fighters can get the upper hand. A couple of readers have asked about local impacts in the area of our ranch. Nope - we're about 180 miles southeast of where the fires are, but thanks for asking. --- Pretty substantial damage from storms going through Tennessee last night, too.
There Be Pirates This is going to change often enough over the weekend, that the best I can do for you is set up a link to the latest 'pirate' news sorted by date off the Google news search tool... Click here for it.
More Iraq Bombings This time it's 9 dead, 31 wounded.
Chemtrails Follow-up... Has a ton of emails on my "Chemtrails go mainstream" report this week including a note from one of the authors of the USAF 's Owning the Weather 2025 Study. Won't tell you who but I can share some interesting concept stuff coming in from lots of folks...that should hold on simmer till Monday. Busy weekend ahead...so drop by Monday.
Around the Ranch: The Case of the Mysterious Bag "George - get over here!!!" It was a mighty excited sounding Elaine on the intercom from the house just after I posted yesterday's column.
"Hmmm...maybe breakfast is ready early," I was thinking, already moving that direction.
But no, arriving at the north deck I noticed Elaine half cowering in the kitchen as she blurted out "George there's something in the cat's toy bag! I started the vacuum cleaner and it moves! Get it out of here...whatever it is..."
So I carefully picked up the cat's toy bag - about the size of a regular paper grocery bag, but made of blue fabric and filled with an assortment of yarn, string, catnip-stuffed toys and what have you, which the cats will sometimes indicate they want us to dig out to play with them. And sure enough, when I picked the bagup, it did move...so I threw it out on the front deck.
That was followed within seconds by Elaine throwing two cats at the bag and trying to interest them in finding out what the mysterious contents were that had been moving around each time the vacuum was started...and which had seems to move in my hand as well.
Upon landing at the bag, however, both cats were like completely bored with the contents. Pusscilla simply sniffed and wandered off wondering "What's that doing out of it's pew?"
Zeus the Cat simply gave me his best "And your point is?" look. It was embarrassingly un-feline behavior.
"Might odd," I found myself thinking. "Wonder what's in there if they have no interest in it? It moved about like a large mouse would...but why no interest from the cats who ought to be going nuts at the prospect of a free dinner....maybe it's a lizard?"
So I carefully dumped the contents of the bag out. No mouse, no bird, no rat, no lost squirrel. and most troubling, no lizard.
Intrigued I then felt the bag with my hands and again, nothing. I stomped on it a few times with my food, just for good measure. Nope, nothing in there; no squishing sounds. Just the pile of cat toys that I'd dumped out.
And then it hit me: In the midst of the cat toys was a partly unwound spool of thread. It was a like gray and about the same color as the vacuum. Blended in almost perfectly with the weathered wood on the porch deck, too. "Aha! I think I've found the culprit!"
Sure enough, this nearly invisible thread led right back to the vacuum cleaner, where each time Elaine turned it on, the thread would pull, but being weak, after just jerking the cat toy bag, it would break, giving the illusion that something was in the bag six feet away. And, the reason I had felt something was that I was walking away from the vacuum to toss it out on the porch.
We had a good laugh over it, but it's an important lesson in how human perception really works. Often we see effects and jump to conclusions about causes based on our own individual collection of experiences as to causes. Out here on the ranch, it's hard to go very long without finding some little furry or reptilian creatures about, so Elaine's jump was understandable. Our collection of house-defending lizards is out already, and the bag acted like one of them might act...and the odd heat-seeking mouse will sometime sneak indoors despite the presence of the hairball generators.
Now that I am reminded how people look for familiar causes, boy, has this given me a who new genre of pranks to pull on you-know-who-but-don't-tell-her LOL...see you Monday morning...
LifeLoops: Living Well, In Spite Of.... In many of the weekly Peoplenomics reports, I pick a single topic and delve into it in some depth. But, this weekend we have a lot more ground to cover than usual, so I got to thinking "What's the overarching concept that ties all this together?" What's on the plate? Well, for openers, there's the usual "Which way for the market, next?" Following that we've got a major web bot / predictive linguistics hit developing with muckers/amok and the developing sense of 'surreal' that will get to the point of paralyzing people sometime over the next year or so. Closely coupled, there's the matter of getting control of your 'framing/reference' systems that either confine or liberate your thinking, and following all that we get into timing the purchase of real estate in these record low rates, a fine point or two about gardens, and as it all that isn't enough, I'll fill you in on the alpha test plans for the 'crop circle spinning software' that my friend Cliff has been working on, and which you, if all goes according to plan, will be able to take part in testing. So as I scratched my head this morning I got to thinking "What's a broad enough headline to take in this wide range of topics. And then it hit me: This is all about "Living well, in spite of..."
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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 or, click one of the following button:
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. ---- Last week's report is here. For back issues of this site, click here. (Goes back to 1997!)
Friday April 10, 2009 Them Winds This being a holiday for some of the financial markets, such as the New York Stock Exchange, we can raise our heads from staring at monitors long enough to look at the general condition of 'life on the rock' to get a sense of things while waiting for the financial market rally to continue next week, as it seems prone to do based on what may be the bottom (short-term) around 6626 a few weeks back. One reason? Financial stocks are doing well. Not just 'well' but very, very well.
WTH? How come banks can't give their TARP money back?
'Them winds" often a theme in linguistic reports are back with a vengeance as hurricane force winds in parts of Texas and Oklahoma have been driving wild fires; lots of Texans getting 'red flag fire' emails from friends earlier in the week saw it coming. Farmers in ag areas are usually pretty conscious of weather forecasts when touching off windrows of deadfall and such, but it only takes a small fire to cause huge problems under certain conditions.
A little deeper into the South, at least three people have been killed over in Mena, Arkansas as a tornado ripped through the area.
Phone Troubles Sabotage is thought to be the reason for the phone system outage in the Bay Area on Thursday. This one is troublesome to me, especially since at least at our ranch in East Texas, the net is slow as mud this morning.
There Be Media, Argh... The pirate 'drama' continues to build in MSM. The hostage tried to escape, apparently, but more to come as this thing unfolds at glacial speed.
War Dough Guess who is asking for another $83.4 billion for the military? Well, at least it ain't banks - but just hang in there, we'll see more of that, I'm sure...
Quake Follow-up State funeral in Italy today for earthquake victims from earlier in the week.
Net Freedoms In France, the parliament has turned down a measure which would have allowed 'authorities' to turn off internet connections of people who download music.
Got Worms? Meantime, the conficker virus continues to make headlines over at InformationWeek. --- Coping: The Topology of Belief Sets A tip of the mug this morning to the LA Times which has a delightful Annie Jacobsen 'Back/Story' feature which is a mighty fine read titled "The Road to Area 51". You may enjoy it. --- I mention it because of the letters I get about my writings on the world of the really (and I mean really) weird / off-the-beaten-path kind of subjects. A little discussion of my outlook is in order, this being a semi-holiday and all, since people on both sides of the 'weird science' issue offer admonitions to me this way and that trying to correct or coral me.
Yesterday's email was a typical mix. One email laid into me pretty good about 'losing credibility' when I bring up topics like Chemtrails. In my own defense, on this one, I have to say that while it's true that some reported chemtrails are no doubt just contrails, there's also a lot of evidence that the military has been engaged ain things like chaff experiments over areas inhabited by humans, and that some weather modification patents have no doubt been tested, since we have only 15-years before we arrive as 2025.
And what is so special about 2025, you're wondering? Quite some time back, the US Air Force published a very interesting paper (it's in the public domain) titled "Weather as a Force Multiplier: Owning the Weather in 2025." Now, I don't know about you, but seems to me that it's reasonable to expect with only 15-years to run, that the military might and maybe even should be looking at such measures.
And with yesterday's talk by the administration about far-out sounding ideas (deliberately putting pollution into the high atmosphere is far-out, right?) to start building a continuum which has, as its major axis, scaling from "t'ain't no such thing" on one side all the way over to "OMG this really is a PTB plot to off humans" on the other makes sense.
Let me take a couple of minutes and cobble up a drawing that explains my 'framing system' because it's a really useful way of at least 'knowing what you don't know' and you can use this approach to almost an exploration of 'unknowns':
As you can see above, what I've done is said "OK, chemtrails may or may not be true as a deliberate phenomena. Let's scatter-chart the reports and see if we can infer something by putting the data points up in some kind of methodical way.
I start with a near 100% belief that 'chemtrails are crap" but as the data continues to flow in, the scatter plot starts to look a little different.
Most people don't pay much attention, at least most folks I've dealt with, on how their thought processes are bounded by belief sets. While most folks sit around and try to reduce their world to black and white or true/false statements, that's really an artifact of living as a 'thought-controlled' person. Whether it's an absolutist set of parents, a religious doctrine that denies personal investigation of the truth, or a socioeconomic group (e.g. gangs, just for instance), people that don't look at the world as a grayscale menagerie are missing a significant opportunity to be more in touch with 'reality'.
Reality ain't simple stuff.
This, by the way, applies to all kinds of human endeavors and here's a shocker for you: The so-called Bell Curve (normal distribution) of Intelligence (as in IQ tests) is not a curve at all. Sorry to say, it's a number of curves, which when you rotate or line them up form what? A topological map of how a person thinks.
This is why you can have some people who score high in math and low in English, yet others will fail basic fractions but turn into Shakespeare Lite, given a pencil. Both may measure using a single-axis tool, but the topology of their thinking will be vastly different. The math whiz makes a fine engineer, while the writer would do better in law or psychology; you wouldn't want to fly in an airplane designed by this type.
This is why when some asks me "What do you think about "X" I look at them with a kind of silent stare because most times they are trying to find out if I am an absolutist and agree with their own absolute/limited view of things. Odds are pretty good I won't.
Not that I will disagree with them entirely, but my topo map will be different than anyone else's because I've collected a different set of scatter points on my chart about [whatever the topic is].
Back to the inbox for a second: While one fellow was telling me, in so many words that I was an idot for even considering chemtrails (despite the patents, AF 2025 study, and the Obama administration's 'floater' this week), another was sending me information about how Arcturians were channeling important information about crop circles.
Once again, I go putting points on a scatter plot. From the absolutist engineer standpoint, 'anyone who hears voices in their head is nuts' would be the left axis. And perhaps, these off-planet encounters via channeling should go over to the extreme right. So the data distribution would be more a "U" shape, with a much higher l;eft side of the "U" because few people actually hear/channel/speak-in-tongues.
But this is where this data-mapping works wonderfully. If someone says "Do you believe in Zeta's? " the answer would be something like "They, and the Arcturians, are a low-probability on my topo map" but most wouldn't follow, so I thought I'd try to explain.
But on my scatter plot, what they don't know, is that one of the
biggest bulges up on the right side of the chart is Julian
Jayne's The Origin of Consciousness in the Breakdown of the Bicameral Mind
So here again, when someone says to me "Don't you think people
who believe these Channelers are nuts?" is not really seeking my
research. Instead, they are seeking my assent or
endorsement of their view, which in case you haven't noticed
yet, I'm pretty stingy about. Throw in books like DMT: The Spirit Molecule: A Doctor's Revolutionary Research into the Biology of Near-Death and Mystical Experiences
I spend a fair bit of energy putting dots on this particular scatter plot since we're all going to go through that door sometime. I'd just like to collect as much data before I 'take the last plunge' so to speak, and would advise everyone to consider it, too. Since the physics crowd is pretty sure energy can neither be created nor destroyed, I often find myself wondering what will happen to the ball of thoughts that is me once 'time's up'. Intriguing - and unavoidable topic. --- Some readers already seem to "get it" on this life as grayscale stuff - and see the same 'dance' as me:
No tin hat necessary, just a good framing concept of scatter plots. --- Well, gosh, this is getting on in length and style of being a Peoplenomics report, but I really didn't mean it to be so. But if, after reading this site for a while you get the idea that "Oh, gee, life really is complicated, then, isn't it?" The answer dear reader is "You bet!" And I'm offering you this topology mapping concept because I've found it useful, and you may as well.
(Damn that was serious!)
--- Send snip and save items to george@ure.net along with a large sack of $100 bills, some coffee tree seeds, and oh yeah, some peppercorn bush seeds, too... --- end snip and save section ---
Thursday April 9, 2009 Chemtrails Go Mainstream, IISo here's an interesting question for you: Suppose...and this is just supposing, of course...you had been running a decade or longer program of throwing mixtures of chemicals into the upper atmosphere in order to reduce global warming, and maybe...just maybe...again, speculating here, to keep people from seeing too much of what's going on in space. How would you transition the concept into the public mind as being 'acceptable' once it became obvious to enough aware people who surf the internet, ifn' you were the PowersThatBe?
I give you the answer in a headline: "Obama looks at Climate Engineering" mentions the idea of, and I quote from the article in the WSJ's version of the story for you (but you gotta read the whole thing by clicking here) "shooting pollution particles into the upper atmosphere to reflect the sun's rays."
Meantime, the "Drop in sunspot activity no cause for concern-professor" says down in New Zealand, but I'd point to the 11-year solar cycle as being linked (like it or not) to climate events here on the third rock.
I reckon it's possible...and I just hold out this as a possibility that by the time government gets around to 'solving' a problem, it may have already passed its zenith for this cycle. Or, on the other hand, once we get on the next peak in solar activity, 2013-2014, or so, then maybe this "Son-of-chemtrails" stuff will save whoever is around then. And, since most of the science indicates that major solar flares happen past the peak of activity, we might indeed see things like power disruptions from solar flares - or worse - on the backside of Cycle 24.
Nevertheless, what's going on now bears close scrutiny, since the PTB are slowly inching this climate control / weather modification agenda out into the public/,open, but it'll likely be done in such a way as to leave the leading-edge thinkers, who've been talking about this for years marginalized as nutters and cranks. And who knows, maybe if the roll-out of what's going on already is smooth enough, no one will notice the few leading-edge types on the 'net who should be saying right bout now "Told yah so!"
We just noticed, though, didn't we?
Markets Set to RallyToday I figure would be a dandy time to enter the stock market on the long side. (More in the Coping section to follow.) For one thing, the RBC-CASH index is showing a solid improvement, which compared to the past couple of months verges on giddiness:
Oh sure, there will be bumps, but the overall tone of 'plain folks talking' seems to be improving along with the weather. Maybe we all go into something of a fugue due to vitamin D shortages in the winter. If you see a report anywhere on the link between nutrition and portfolio results, I'd sure like to see it.
On the other hand, longer term there are also clouds on the horizon. For instance, there's a new Rasmussen poll out today which says "Just 53% say Capitalism better than Socialism" and the report continues:
Combine this attitude shift with the SEC considering revisions to the uptick rule and I think you've got a good shot at 10,000 before July or August before things turn south again in the fall.
A buoyant mood, uptick rule, jawboning, and vitamin D rising...what's not to love? --- Well, now that you mention it, there is the matter of the balance of trade figures out today.
Want to see a really butt-ugly chart? Try this one:
Not the end of the world, maybe, but you can almost see it from here if you look closely... --- Meantime, there's even a glimmer of hope that the retail sales decline rate is slowing..
"V" is for VelocityIt came to me in a flash of insight on Wednesday afternoon: No matter how much money the Obama administration, the Treasury, and the Fed, pump into the economy, if consumers cut back spending enough, then we're all screwed and no amount of printing will kick-start the economy.
So I called Cliff up at www.halfpasthuman.com and began the conversation by asking "You know why the economy is going to continue collapsing?" His answer was something to the effect "Gee, because you can't capitalize debt?" Oops, he's already there.
Still anxious to share my epiph, my next call was to my consigliore: "Hey, you know why this Second Depression augurs in anyway this coming fall when another leg down should get rolling? Velocity!"
His answer was almost like Cliff's: "Yeah...that's been in my model since 1979...the only question is about the timing of when the policy decision will be made to kick inflation into gear to bail the economy out because bouts of inflation usually only last four years versus deflations which go a decade..."
Hmmm. Must be preaching to the choir. If you have a less smart group of friends, though, you might point to the story we talked about yesterday (about credit card use falling like crazy) that's being reported today under headlines like "Fed: Credit Card Debt Down Almost 10 Percent" and dazzle your friends with a snappy short discourse on what happens when velocity (collapsing transaction counts) overrules policy intentions.
Let me know how many folks you put to sleep. --- From cartoonist Rebecca Price of www.toon-republic.com:
Madness on BorderingSeems the Obama administration is going to try to push through a new immigration bill.
Wait! Is this another example of government solving the problem after the fact? With a falling economy here in the US, and some reports of border traffic of people returning to Mexico, what would make sense is 1) finish the fence and 2) enforce existing laws, seems to me.
But how often can the lobbyists line up the right combination of "social(ist) correctness" with the corpgov agenda to fill as many jobs as possible with low-paid imported workers? Wrap immigration loosening up in a McMerica flag and everyone oughta salute, right?
Oh a few will whine: The average middle-of-the-road fellows like me who come and go across the nation's borders with a passport, searches, laptop confiscation possible, and so forth, while the folks who criminally trespass are likely to soon get a wink & nod and a "Oh...that's OK..".
WTF people? Am I the only one who remembers the 14th Amendment's equal protection concept? Or, in our headlong rush into political correctness have we made some people more equal than others? I don't recall seeing Danish textbooks being used anyplace in America, don't recall German or French being used outside of language classes, either....I'm just saying reread #14... --- Then again, there may be a hidden corpgov agenda of 'making work' in all this. Do I to recall that Canada went through a whole bunch of sign-making, book printing, and teachering to implement bilingualism....so yeah...OK, maybe it's all a make-work deal and we should support it. Francophonely speaking. --- Hold it! Have I just stumbled into a link between the sometimes ungentlemanly way hockey is played and how South American gangs operate in the US? Write me a report on how language minorities act out violence....and throw in some examples from the recent immigration wave in Europe as contributing the the problems of France, too... The mind boggles. Where was I? Oh yeah...
--- Snip and Save Section---
Coping: Legging In"So you are really doing it, huh, tubbo?"
Crap. My sidekick, Zeus Fleaster, the independent-minded pure black cat had gotten to the computer first this morning and was already pre-sorting my emails for me.
"Says in your brokerage account that you've bought a couple of September $25 silver call options in the commodity account. Didn't we talk about this?"
Indeed, we had. I'd explained to the cat that I thought silver, along with gold and oil, might do pretty well in a bounce which I expect into about the middle of summer.
I shot back: "You can't be a wimp all the time, Zeus. Sometimes you just gotta go for it. Look how things are lining up: The ALTA/predictive linguistics work says there's a serious period of 'happy-talk' due right after Easter, there's the usual just-before-Easter low being done this week maybe yesterday was it, and then you've got a generally improving public mindset. You see the NY Times poll this week? And Robin Meade was talking about a new CNN poll which showed less pessimism, not 20-minutes ago."
I figured that would shut him up...darned nosy cat, anyway.
"Look, stupid biped...you've got a little over what, 76 trading days till these things are dead meat and you are gambling that the price of silver will more than double? Are you on crack? If you'd spend less time eyeing Ms. Meade under the thinly-veiled guise of trying to find a correlation between her jewelry and market direction, and more reading of your email, you'd probably be a lot fatter in the purse. Here, look at this email that came in overnight:"
"And as if your silver moves aren't crazy enough, you got a call from JB and he wanted to know if you were gonna pull the trigger on some oil and gold calls this morning. Have you completely frigging flipped out? I haven't seen anything this crazy since my last bout of distemper..."
There are times when having a talking, computer-savvy cat as an assistant is a bother. "Lookie here, Zeus...your portfolio was only up because you lucked out on your entry into Reckitt Benckiser Group...why'd you buy them, by the way?"
"They've got something you're seriously missing," replied the furry feline "A good product line, predictability, and besides, they own D-Con and I know that vertical inside-out."
Hmmm...The cat had a point, but I wasn't about to back down on my trades.
"Listen fur-face, far as I'm concerned, buy& hold is dead and silver, which in case you haven't noticed, is largely a by-product and with copper and some of the other metals down, I figure it's bound to go up. Besides, the Gold-to-Silver ratio is still way outta whack, too..."
"Whatever..."
"That's it, you're going outside until I get some fills on the gold and oil calls...go chase a mouse, or something."
"I catch more mice than you catch doubles, salad-breath. I know where the catnip is planted up in the garden..."
"Hey, don't forget to log out...and WHAT THE HELL is the deal with your new email address "ZeusIsHot@gmail.com, huh?"
"Been running some personals in the Rat Report...nothing you need to worry about..."
"Oh no! Not again...am I gonna have to start putting saltpeter in your milk again?"
(door slams as indignant cat exits)
ErrataThursdays being "National Correct George Day" I have to note that Robin Landry's comments are not distributed to his retail clients but to other professionals in the industry. He actually talks to his retail clients (any more that's something of a rarity...) Anyway, the notes when posted here are for colleagues in the biz.
OutlookA bunch of things popping off in Outlook which may be of interest, and no, not just my getting a crown installed at the dentist's office this morning. No, I was thinking you'd want to be reminded that the New York Stock Exchange is closed for Good Friday tomorrow. Next market holiday is Memorial Day May 25th...kinda early this year.
A check of the Google news search tool pops back with 4,350 returns when "good friday closings" is tried. You've results may vary, but the main thing for most is the to remember to hit the bank if you need some cash for the weekend.
Tomorrow's column will be a bit shorter than usual, most likely, unless I go insomniac again.
One more Outlook item: Taxes to be in the mail by next Wednesday. Annual returns and quarterlies...
Wednesday April 8, 2009 Debt Disaster GrowingDon't look now, but things just got worse; in fact very much worse. I don't refer to the Italian earthquake which may have killed 250, nor do I refer to the U.S. electrical grid being "penetrated by spies". although that's all worrisome stuff, and a bummer, and all that. But no, it's not my candidate in either event for 'disaster of the year' because that shapes up to be in the field of economics.
I refer specifically to the collapsing consumer debt figures released by the Fed on Tuesday afternoon. As my friend Jas Jain is fond of pointing out: "It's the debt, stupid!"
The Fed's G.19 Consumer Credit (which is really debt) report shows that in the month of February, people cut back on revolving debt (think: credit cards) at an annual rate of 9.7 % while nonrevolving debt (think: house payments) increased a tiny 0l.2% annualized rate. Overall, debt was dropping at a 3.5% annualized rate.
Now let's think this through for a moment: What does it mean. Well, first and foremost this is a 'consumer economy' - and the aggregate spending of consumers is something that essentially determines the overall growth rate of the economy. Want to see a 20% nominal gain in the gross domestic spending? How about enticing consumers to spend 13% more annualized and do this against a background of 7% inflation; that'd work. --- In considering the economy (or company sales reports in financial statements) I always look at "growth" of companies in a really jaundiced way. I always look at purported growth in the way companies report sales and then discount them for inflation to get something near real growth.
For, what is this? The 800th time, or so, I will direct you to the Minneapolis Fed web site so you can look at the underlying inflation problem for yourself.
Suppose you're eyeing a company that offers sales figures going back to 2005 and you notice (helped along by your calculator) that company sales have increased 10% over the last four years. "Aha! Good company, still growing despite all the crap in the economy!" And you go throw some money on the table hoping they will continue growing.
That's a horrible formula for one simple reason: monetary inflation from 2005 to 2009 was 11.83% (so sayeth the Fed so it must be true, right? LOL). So that company which might have appeared promising at first blush has actually shrunk a little bit on a constant dollar basis. So too, if the company was in some kind of consumer-dependent sector, I'd sure be wary of it simply for the reason that we may have passed a nearly invisible 'tipping point' beyond which the normalizing influences of things like reduced borrowing costs may not stimulate as expected.
Think of it this way: It's like a big teeter-totter. Consumer sluggishness weights down one side, but the other is increasingly weighted down by lower and lower borrowing costs. Under normal circumstances, the reduced costs of borrowing would stimulate the economic teeter-totter back to balance.
Unfortunately, though we have several problems which the administration and most mainstream economists aren't working into their models. First, the consumer side of the teeter-totter is weight down with a huge weight caused by consumer demand saturation. How many pairs of sun glasses do you need? How many flat panel teevees?
It's amazing when I start adding up the number of computer and TV screens I've got here at the ranch. Ready for this? In my office there are nine, and in the house there are five. You're wondering "What in the world are two people needing 14 screens for?" Well, they're not on all the time, but they all contribute toward efficiency. Normally when I'm working early in the morning, I only look at four, but I'm eyeing a bathroom remodel project and wondering if the few minutes spent...er...sitting down...could be turned into more input time, in addition to output time, so to speak. Pondering whether the change of that input time from magazines to screen(s?) would make sense. Maybe not...
(Yes, I look at humans as having three primary modes: input, output, and positioning/travel mode. Anything else, save some dedicated meditation/contemplation time is nonproductive.) --- So let's get back to the charade, shall we? The SEC considers the uptick rule today, which while it might prevent sell-off from occurring as quickly, shouldn't do much about general market direction. The uptick rule might help get the second leg of the major Wave 2 rally stoked up till about mid July, which is my present expectation, but the Fed numbers, if repeated next month, would really bother me.
I just wish the SEC would skip things like the 'uptick rule' so that investors could see unit sales volume on something near a real-time basis. Like the old saying goes, "We don't have any problems more unit sales wouldn't fix..."
Up to a point. That point being where consumer saturation and falling price points take over. --- I was having a very interesting conversation on Tuesday with a TV producer (who's working on a new show which might air on the History Channel) and I explained, as best I could:
I trust you've seen the "New data show rapid Arctic ice decline" and that on the bottom of the world, the Wilkins Ice Shelf is in self-destruct mode?
Time was when most Americans didn't give a second thought to the nuclear war possibilities and the policy/threat response which was two-fold: Mutually assured destruction (MAD) under Robert McNamara (who went into banking (World Bank) from there, LOL). The other was "Duck & cover". Which, most over 50 know is where the old joke, "Bend over and kiss your you-know-what good-bye" came from.
This have changed, and the threats are probably about as real, but eyeing them head-on is no longer socially acceptable. Oh sure, the odd article, like this one in the Fort Worth Star-Telegram do begin to break the mold on 'preppers as nutjobs', but it's only a start. --- Oh: One more thought, as long as I'm in cheer-you-up-mode: Don't know if you have penciled out what happens if the global warming problem really does turn out to be a combination of skewed data plus pollution masking the real impacts of solar output. But, I'd be keeping a very close eye on the possibility of a deep solar minimum which is underway right now. Have you even started to consider the energy implications of a reduction in the sun's output and what global cooling would mean in terms of energy demand? Reduced agricultural outputs, reduced rainfall (since solar heating drives evaporation)?
The two most important - stories of the day are likely consumer saturation/ debt declines and the fact that as ABC headlines it: "Sunspot activity hits a new low." Stories like these are the drivers of longer-term outcomes, not something transitory like the 'uptick rule'.
So my comment for the day is what? Keep an eye on 'the debt problem'. And watch the Wholesale Inventories number when it comes out this morning in an hour, or so. If we see inventories building, that'd be a very bad sign because it could fuel additional layoffs, and that would be another step toward what I can the reciprocal of the "virtuous cycle".
Some call that the "vicious cycle". But for planning purposes, it's easier to label it TEOTWAWKI (the end of the world as we know it), because a complex global system collapse -- despite the financial lovefest at the G20 last week -- is still on the table.
How's your garden doing? You don't need TEOTWAWKI to benefit from it. Just a hike in food prices. Or one of them damn pink slips.
Days of Futures Past? All this discussion of the paper chase is not exactly moot. The stock market is looking to open almost 200-Dow points lower this morning. What's the worry? Well, I may not be the only one who is starting to add up the combined impacts of slowing globe and scared consumers. A Yahoo/AP report mentions earnings as a concern. Well, quick, look surprised. What we we just talking about?
Silver Popping Soon? My commodity guy, JB Slear over at www.fortwealth.com just called. He says every day now, for the past five trading days someone has taken delivery of 2-million ounces of silver a day. Watching this one, and watching silver prices.
Someone heading for the Bunker so to speak? Copy that?
A "Last Warning" Again The fact that the "Sri Lanka military sounds last warning to Tigers" gets me to wondering how many of these last surrender offers have been made over history.
There Be Pirates And they be pirating more Americans...21 this time. The hijacking rate seems to be slowing, but that may only be a temporary condition since seems like the various countries of the world, including China and Japan have thrown some resource into the area.
Government Motors While that 30-days for a better plan clock is ticking, I can't help but notice that Chrysler has unveiled a new Jeep Grand Cherokee remake. If I read Edmunds.com right, the high end Jeep Cherokee Overland weighs in at $44,845 MSRP, weighs 4,891 pounds and has a combined city/highway 15 MPG.
Yeah, I'd say it could be redesigned a bit. Call me when it's half the price, three times the mileage?
Fideling Around Department So, Fidel Castro wants to warm up relations with the US? Help president Obama? Well, Cuba does have a working national health care system which wasn't installed by the pharmaceutical lobby.... that might be a help...
Another Missile The JPost reports today that "Israel successfully tests Arrow 2 defense system." Couple of days earlier and a few thousand miles away and they could have gotten a 'two-fer" when that NK missile went up...oh well. next time?
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Coping: Retribing Around Interests Had an interesting evening last night, attending the local ham radio club meeting...good time, but I had to leave (unfortunately) before the main presentation of the evening which was about using solar power for ham radio. Having solar panels, I have kinda got that one down; maybe a huge overkill, but whatever.
Oh, sure, our local club is not as busy as some of the big ones around the country; probably the two I'd point to as wonderful examples are the Boeing Employees Amateur Radio Society (BEARS) and the MIT Radio Society which turns 100 at the end of this month. The MIT club has some dandy historical pictures of old-time radio, here, if you're interested.
But my point this morning is not about ham radio (now More Code-free, by the way). Nope. It's about 'clubbing' and what I call 'retribing' of folks. --- Although Palestine is a fairly small community (by East Coast standards, anyway), there's a surprising number of affinity groups/clubs/ self organizing collective activities. Maybe it just seems richer out here in East Texas because there's a lot less social noise. Or, maybe it's because the idea of community involvement/community service is held in much higher regard out here than I ever noticed in the "Big cities" I've lived in.
The local Boy Scout troops are well-respected, and with good reason: The provide community service labor to clean up the signs welcoming folks to Palestine (monument type signs with a little landscaping around them). Then there's the 4H and FFA activities. Girl Scouts active too.
For things a little further along the timeline, I was surprised as all heck to find out that there's a fairly active writer's club. And Elaine still has a carving project to get started on, since she attended the woodworking club meeting recently. Oh, and the we entered our red car in the recent car show put on by the Cars of Palestine auto club.
And we have some great gardening clubs in the area, as I guess you'd expect in an agricultural area which has plenty of water, most years and a favorable climate, even if the soil is mostly worth of pines and onions (with lots of nematodes, but it is what it is).
Did I mention that there are all kinds of hunting clubs? Yes, plenty of those, too.
Maybe it's because I have been spending waaay too much time in the 16-hour Type A track, but until recently I had remained fairly ignorant of all the clubs/affinity groups that were floating about society. Not that I have time to be very involved, and not that I'm much of a joiner, but I guess until recently, I hadn't been paying much attention. --- "OK, why mention this?" Fair question. I'm starting to feel urged, if you will, to get a little more involved in a few clubs locally. Just thinking, at this point. But with the possibility of further social stress ahead, especially if the economy keeps unwinding -- and super-especially if we get past some undocumented tipping point and things really head south -- then being able to plug in to some of the local interest "tribes" seems like a very wise thing to start investing in.
So, I'm actually put the next ham radio meeting in Outlook, which if the truth be known runs my life more than I do, sometimes. Just something to think about...getting involved at the 'goes to meetings once in a while' so that should the community need to pull in this direction, or that, for whatever reason, you'll at least have an idea where the ropes are.
I think it was the plans made last night for a hamburger BBQ before the next ham meeting that finally got me to put it on the schedule and mention it, LOL. --- Oh, and if you schedule everything and I mean everything in Outlook: A new "Spray for 'six times longer' sex" may screw up your schedule, so to speak...but my schedule is usally (you know what'ed) by the end of the day anyway....and this priority is usually...URGEnt, LOL...
Tuesday April 7, 2009 Sustainable Run RatesBuckle up and try to stay awake though this, as I've got my lecture robe on and have been sniffing the china board marker for a few minutes: Want to know when it will be easy to call the ultimate bottom here in the Second Depression? Wait for factory run rates to stabilize. "And what brings this up," you're wondering? Well, buried in all the headlines and economic noise on Monday was this little report from the Midwest Fed that 'factory activity slips in February'. And, looking elsewhere, the astute investor could notice that a "Poll - India's Feb industrial output seen down 1 pct/y/y".
Then we have to consider the headlines out of the UK where happy-talk/rally-the-sheep blather about manufacturing has been finessed in ways that add immeasurably to what out predictive linguistics pals call this period of developing 'surreality'. Here's a perfect example.
Confused? "Beats Forecast" may be viewed in a "only fell off a 24 story building instead of a 30 story building" kind of way. "Less than expected" may refer to it only being a 16-20 story building, while "Most since 1968" sounds like it refers to the mess on the concrete, compared with other manufacturing death leaps in the past.
Sorry if this is a bit graphic, but it's important to have your head firmly wrapped about the way numbers of column inches of 'news' reports can be distilled down to a single number while the rest of the words in the story - a few hundred in many cases - boils down to contexting this way or that. --- Once you're nodding "Yeah...OK...so what?" the next item up is understanding that economics of the conventional sort hates...and I mean loathes in a fearsome way, the very idea of cycles. Oh sure, those cycle guys (Schumpeter, Juglar, Kitchin, Kuznets, Kondratieff/Kondratiev, et all) make interesting reading, but the study of economics as the complex interaction between cycles is generally frowned on by economists of the mainstream stripe. (*If you've really been hitting the coffee this morning you'll notice that of these cycle guys, why are there so many with last names starting with 'K'? I should change my last name, perhaps...)
All of which would be fine if the conventional-thinking sorts had a demonstrated record of accurate predictions, but they don't as evidenced by the crap-pile economy we're in right now, the main feature of which is what? Pretty much falling everything. And that's why we need to consider something that I've yet to see discussed in economics in anything other than nearly incomprehensible multiagent variant studies that'd make your head hurt. I call it simply "The Slosh."
No, it's not exactly an original concept, since it's covered pretty well in the study of complex systems - which gee, gosh, economics really might be -- but it doesn't make headlines because no one has come up with the really simple way to convey the information, other than infer how the slosh is going by looking at a broad economic indicator, such as the Consumer Debt figure due out from the Fed today, which has me sitting on the edge of my chair with anticipation. Either that or because I need to run down the hall, but let's assume it's anticipation... --- My consigliore', the JD in Tax Law and CPA fellow who I often credit with being not only a good friend, but a fine economics thinker, actual got me to thinking about how 'slosh' worked when we were exchanging views on the old Long Wave Economics newsgroup run by the University of Colorado back in the day. He had made some very interesting comments about how in his modeling of the economy (easily done with linked spreadsheets if you have enough time on your hands) suggested that, just for example, oil price movements could take as long as 60-months to be fully integrated into the price behavior of all markets.
If you're a conventional economist, stuck in formula-land, a good starting point for visualization would be a multivariate implementation of the Putnam-Norden-Rayleigh Curve:
Where Ea=Effort in person months td=The nominal delivery time for the schedule ta=Actual delivery time desired
Or, maybe the F.N. Parr alternative. What I envision is something like this, and I'll annotate this as a oil price change implementation, supposing that you have an oil price change - like the OPEC shockers of the 1970's coming through the system...
So was the 1980-81 'soft patch' just a result of a new stability point in run rates and consumption following the 1970's oil shocks? Maybe...
And so it goes for how economic shocks work out. As to where we are today? If I were guessing where we are presently in how the curve is developing, we might be looking at something like this:
Pardon the lines not being precisely smooth - it's early yet and I don't have a lot of time to spend on getting the drawings 'just sop' but you can see the problem: There's a fair chance that we will have some kind of a gulf problem develop between this fall - when around the end of October it will start to dawn on markets, I figure, that "OMG we are still in a recession and is this a DEPRESSION will kick in...and the Obama folks will be right saying "Remain Calm: Economic recovery is almost here..." but by then the villagers with the pitchforks and torches will be at the gates of government at all levels asking "WTF?"
But, thanks to the miracle of offset curves, we can sketch out the road ahead in very general terms, and hopefully have a much smoother sail through the Straits of Disaster.
That funny shaded box are, by the way, means that we could argue endlessly about precisely where things are, but the main thing is to get the overarching view right and let the rest fall into place. --- OK, now that you're back to sleep, we move on to the next pointer. Starting with Robin Landry's latest note to his clients:
And this is the place where I have to point out the usefulness of having the 'skewed curves' thing in mind, because you can see not only how I'm viewing things, but how Landry's work - which comes from about 30-years of pushing data around following grad school has reached a similar outlook.
And as if Landry's work and my view isn't enough, I can help but note another guy who has much the same outlook as mine & Robin's is Dr. Marc Faber who says "Stocks may see 'correction' of 10%" before we continue the rally. So from 8,000 and change, a knockdown of 10% would be 7,200, which as I've told you before is what? Landry's 7,200 (or 7,100 next level down) of support.
If you're really, really awake, you should here something that sounds almost, well, George-like about this part of the Faber story:
Don't mean to spend so much time on the mechanics of how all this works out, but then again, people come here looking for serious economics and light-hearted humor. This is not financial advice...just how I think things will play out: Gold lower before higher, stocks lower before higher, and if you think the sociopolitical air is charged and tense now? Wait until this fall. Keep October 26th circled...not that it will be the day, but around there and the weeks following, say the linguistic reports, government's gonna be hunkered down trying to cope with a whole mess of humans who haven't had the roadmap handy who are going to be frothing mad about prices going up and wages going down.
The only thing that keeps us from auguring into new Third World status is manufacturing of something at a sustainable run rate. And, since our manufacturing of bogus financial products has been outed, we've now got to come up with something else. Unless, of course, we can figure out a new 'over-unity' kind of government, where government gives back more than it takes in the way of taxes.
Pardon me if I don't expect that breakthrough in human events will be coming any time soon. So, I will just work on my garden, tend my investments, and ponder how the system can keep the obvious hidden in plain sight for so long.
Hand me a fresh china board marker, wouldja? This one doesn't seem to have...oh...you know....
Dancing Mountains, ReduxLooks like the death toll is ultimately headed for the 200-range in Italy from that quake this week. --- USGS reporting a 6.9 in the Kuril Islands ( that's north of Japan, like you're heading up to Siberia) overnight.
Government MotorsAppears to be in the cards as GM Said to speed bankruptcy plans and board crafts savings goals.
But wait! A two passenger, two wheeled car from a GM- Segway alliance? Hmmmm...would I still need to have a motorcycle license for it, being a two wheeler and all?
New Media NotesI notice where the Associated Press has started to move toward tighter management of its content.
One of the things a lot of web surfers don't realize is the huge amount of cross posting that takes place on the web with many websites guilty of what can only be described as wholesale content thievery. Many sights take whole articles and simply repost them without adding any value (such as the contexting which I try to provide here) and claim to be an internet news outfit, which most are not.
Maybe it's been my news training, but there are two cornerstones of the UrbanSurvival and www.independencejournal.com sites: A business model that doesn't depend on banners and content that is original with links and only headlines (usually RSS type) back to original sources.
Sites that simply repost and profit? Think sun setting.... --- The search last week of a Phoenix blogger's home is making headlines this week. The open question is this: Is it threatening or intimidating because of the reports done over at http://www.badphoenixcops.com/?
Non-Profit WagesThe Wall Street Journal online has an article you might want to look at if you're a highly compensated executive with a non-profit operation. Upshot of it is that non-profit execs might get the same kind of scrutiny as bankers...and one of the ripest of areas could be the healthcare sector where high dollar comp in 'non-profit' hospitals is...let's just say...not rare.
Global Whating?While much of the US is under freeze warnings - a bit late in the season if the old farmer in me has it right, we note that the UK Guardian is reporting on the Wilkins Ice Shelf is on the verge of collapse. Since the predictive linguistics work over at www.halfpasthuman.com says the actual beginning of the global coast event will follow the March reports start of its pendency by 60-90 days, we can circle the May-June period for when this puppy could let go.
That in turn could let ice on land be freed up to slide in, and ta-dah, Florida gets closer to becoming a reef. Wonder what the LEAP put equivalent investment vehicle would be?
Oh, Those Iranians, DepartmentYou might want to read the NY Daily News report headlined "Iranian nuke plot vaporized in the city: NY banks unwittingly aided in material transfers, says DA." --- When details of this come out (apparently later today) it may go some distance in proving that Iran really does have a weapons development program. Which, it goes without saying, is obvious since when you're sitting on a hundred years worth of oil, the "We need electricity story" just doesn't wash.
But, on the other hand, if Pakistan can be trusted with nukes, why can't Iran? After all, the US and Russian examples show that nuclear weapons, although not used yet, have acted as a kind of steroid -- or testosterone to be more specific -- with regard to international conduct.
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Coping: Food Safety or Uberment Controls?Ah...a reader sends this on controversial HR 875:
I'll tell you what: I will throw 875 into my Vortex Reader again and reread it today, but seems to me the first time I did it, I got the impression that while the stated objectives sounded good, it was kinda like the (misnamed) Patriot Act(s) which although they seem reasonable at first blush, could be used by an authoritarian despot as a means to crack down on people. So tell you what: I will comment more this week after I do a reread of it...
Site CachingA reader sent me a note which happens from time to time:
Fear not! If you can't get your daily dose of UrbanSurvival on the main page, www.urbansurvival.com/week.htm, there is always the www2.urbansurvival.com/week.htm page, or the blog style formatted version at http://www.urbansurvival.com/blog/.
Still, there are some supposed 'productivity enhancing' internet censorship tools commonly used by corporations which would rather you be working for their interests rather than thinking so damn much. For these, I have set up the www.independencejournal.com site, which is usually updated about 5-minutes after the UrbanSurvival posting goes up. --- A few readers have mentioned that there are some days when my writing is pretty good, while other days the content is OK< but they've found need of decoder rings and animal entrails to figure out what I was getting to, since there were so many spelling errors.
Yeah, that's a problem...and once again, if I had my fancy polling software installed ('soon come, mon') I'd be asking something like "Which is more important to you? Proper Englitch and use of smellchecking? Or, would you prefur more content?"
Pick one of the above...
Curious Word Concepts Got a press release from NOAA the other day telling me that "National Tornado Experiment to Begin in May." The advisory continued:
Well, this is kinda cool, I thought, as I continued reading:
I wonder why they didn't including Washington DC as one of their sites? Lots of hot air around there, I'd think would create all kinds of interesting meteorological effects...fact they should be huge, since the financial effects of all that hot air is obvious. --- Then there was the reader who sent me a note all excided by reports that the reason for the Large Hadron Collider being shut down was because a 'black hole' had been created and was being carefully guarded.
I just didn't have the heart to remind the fellow to look at the dateline on the story. April 1.
Monday April 6, 2009 The Good Times RollThe big economic number to those of us who watch inflation/deflation battling will be tomorrow's Consumer Debt number. Mislabeled "Consumer Credit" by the Fed, which insists it's called that because banks issue credit to consumers, in the Land of George, it's all about humans, not bankers, and let's call it what it is....debt.
Whichever side of the name-game you're good with, the news tomorrow afternoon should indicate if the economic 'stimulus' promotion has been large enough to pronk consumers into resuming their free-spending, debt-ridden ways, since America has transitioned from being an economy based on producing things to an economy based on financial products musical chairs.
To be sure, the Financial Standards Accounting action of last week contributed to the recovery in financial stocks, but for how long is anyone's guess. The futures are looking a bit downish prior to the open of trading this week, which I'd expect this week to put in a pre-Easter low or pullback of some size. Couple of hundred points down, anyone?.
As I've been expecting, gold seems to be pulling back, as safe haven buying is drying up. Because there's so much inflation in the pipeline, I figure gold is a slam-dunk over the longer since Treasuries are yielding bupkis. All depends on the timing and gullibility of foreign investors, I reckon. --- Oh sure, a huge fraction of American's are unemployed, or seriously under employed - something close to 17%. But look at the flip side of things. You know all those IT and Customer Service/CSR (IT-enabled Services - ITES) jobs that have been outsourced to India?
Payback in the great karmic scheme of things? --- Fritz Henderson at GM is not ruling out the possibility of bankruptcy. So the auto troubles continue - bad news for IAW workers, but if you run an auto repair shop, it might mean more business. As cars stay on the road longer, and I've been watching auto repair stocks like AutoZone which has gone from around $89 in late November to over $160 a chare recently. A fine example of how one should be reading the news and figuring out the consequences of the headlines. Do that well and you're bound to see better results in your personal portfolio, if you have one left. --- Despite some banks trying to give back their TARP money, the government's not interested. Seems instead that the Treasury is planning to expand its role of financial uber meisters as secretary Tim Geithner considers ousting bank execs. If the feds can call the shots in Detroit, where will it end?
Perhaps if Geithner can keep the bank execs cowering, none will come out and spook the markets by revealing the true nature of 'snake-eats-its-own-tail' economics now in play. As long as that can happen, aided and abetted by the FASB's complicity in accounting rules, the good times seem destined to roll. For a little while, anyway.
Don't pay no mind to stories like "Mortgage Fraud Epidemic: How the FBI Blew It and Why There's No 'Perp Walks'", unless you want to deal with reality. Your call. Good times are a lot more fun than reality...especially if you're locked into the paper-is-money paradigm. And I might be getting into that paper chase myself on a good pullback this week....maybe....
Really A Crisis?Despite some reports that North Korea's rocket launch was not a total failure - the Western press apparently not able to admit it actually worked - I keep asking myself this nagging question "Is this really a crisis?"
Yes, the government of North Korea is about as friendly as a rattle snake and as predictable as a as a cornered politician, but seems to me that the horse is out of the barn now, and unless someone is willing to step up and impose a food embargo, or hornswaggle China on this, there's a whole lock of fiction and not very much traction.
Ah...here's the word traction again this morning in a spacey-related way: "Satellite proposals gain traction after North Korea's launch" says the WSJ Online edition. And, of course, the republicorps are urging punitive actions, take John McCain for example, please. ---- It's like the distinction between data and information: Data that can't be distilled down into action is pointless and I'm not seeing anything much in the way of action steps/go forwards out of present coverage. Maybe I missed it, but this seems like the news department version of one of those 3-hours meetings in the conference room back when where I emerged often going "Whew! Was that ever a waste of time..." --- Still, there is some information to be had looking at polls: When the cross-tabbing and interviewing's done, turns out the partisan gap between the republicorps and the democorps is at its widest in a long spell.
Now that is useful information. When the real 'balance of power' in the world is between the 'have's and the have-nots, notice how the partisan lines/ vertical axis get ramped up in order to suck people back into the right/left paradigm, rather than the horizontal axis which defines vertical position: the PTB vs. the people... something to ponder, don'tcha think?
Dancing Mountains DepartmentA 6.3 earthquake has struck central Italy about 70-miles north of Rome, Italy this morning. At least 50-dead according to some reports. Homeless exceed 50,000 in this report. And the scientist who tried to warn folks? He got into hot water.
Sun Set?IBM is reportedly taking its offer to buy Sun off the table.
Car Bombings
Montana Gun PlanLooks like Montana is on the way to the Supreme Court over the persistent attempts in the District of Corruption to wipe the Second Amendment off the books. It'll take a while to get there, but that's how things look...
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Coping: Monday Management School There's a very interesting question of policy behind the story in Variety this weekend about how "Fox fired up over 'Wolverine' review. Seems the fate of blogger/columnist Roger Friedman may be up in the air as a result.
Best I can figure, the problem is that a copy of "X-Men Origins: Wolverine" was leaked onto the web last week and Friedman reviewed it. And 20th Century Fox (all this is internal to News Corp) is worried that the leak and review could cost millions in potential box office receipts when the movie comes out in a month or so.
Here's the interesting policy question which we will pose this morning for "George School for Wannbe Executives": Would you fire the guy who wrote the story about the leak and who did the review, or would you just pursue the source of the leak?
One of these days, I will get my fancy online polling software installed so we can ask questions like this because it could be argued either way. Money versus "what's news?"
My call? The blogger was just doing his job, as I see it. A major motion picture was leaked onto the web and that's news. Someone in 20th Century oughta be answering for how the leak happened.
Meantime Back at the Abyss A reader underscores how continuing layoffs are really starting to bite, despite the momentary hit of nitrous that's puffed up the financial markets:
I agree whole-heartedly with the assessment, but I'd note that this 'one month from the abyss' has been largely hidden from the general public by tweaking government numbers. Most especially, I'd point to how the personal savings rate figures have been changed to reflect declining home values.
When things were on the way up, personal savings included a bit of the increasing valuation of a family's home. Now that home values are dropping at 18% - 19% annualized (more or less, depending on market) the savings rate. I'll show you what I mean. Here's a chart from the Bureau of Economic Analysis very much on point:
I don't know about your circle of friends, but in mine, no one was able to save at a 3% rate in Q4. When we talk about savings, though, we have to be quite specific: The way the n umbers skew presently, it's no longer a measure of net worth, it's more a cash flow problem.
Officially, we find the definition of the Personal Savings rate on page 17 of the National Income and Product Accounts manual used at the Bureau of Economic Analysis:
Under this cleverly worded approach, the actual performance of your home as an investment, or that 401(k) spanking you're trying to claw your way back from doesn't figure into the savings rate.
Since my topic today is "Monday Management School" I'll leave you to ponder how you'd make the call. The NIPA approach is to call the savings rate money before it's allocated to various investment vehicles, while my approach is that the savings rate ought to be genuinely reflective of the change in savings of all sorts. That would include home equity change, 401(k) change, cash in the bank and so forth, because to anyone with common sense, that's what saving is.
In the meantime, ABC report "As home values fall, property tax revolt brews" in a tea party kinda way.
Net Trends/Police States Here's a worrisome headline for you: "Is the end near for Free Thinking on the Internet?" Probably not for a year or two, but in the past when a n industry was getting a little too good at communicating, regulation came along. Remember the Communications Act of 1934 that popped up around the mid-point of the last Depression?
No worries here, of course, since I try not to engage in that free thinking stuff. Low priced? Well, sure....
Swirly Thingies, Redux Tons of comments coming in on Crop Circles and whether they contain information of any importance when spun:
And here's a really cool one from a computery kind of fellow:
Sop is there something embedded, or is this just an artifact of home humans process video? More to come...and yeah, as soon as the first round of chores for the day is done, guess what I will be spinning up?
Here's the latest from www.opencongress.org on the House bill which would let workers inside the District of Columbia work income tax free!
Before the chart, a little background: Once upon a time, a long while ago, I observed during my quest for 'truth' in economics, that the PowersThatBe, the talking heads on the teeve, and the other information sources that actively engage in the programming of humans not to think, had conveniently swept several trillions of dollars that disappeared in the Internet Bubble's bursting (since spring 2000) under the rug. Surely, it wasn't unnoticed by the thousands of people who called brokers and said "Where is my money?" "Gone, but hang in there as you're a long term investor!" was about all they heard back.
So one of our charts for Peoplenomics subscribers oughta be widely circulated - it shows that if you line up the peak of the Dow in January 2000 with the peak in early September of 1929, we're on a very very close replay track. Much closer than even the chart shows if you were to back out inflation, and put in the effects of 1929 deflation, but that'd be real work, and I'm sort of lazy if the truth be told.
No, it's not a perfect replay of 1929, but history doesn't repeat exactly, it only rhymes. So think of this as the rhymes and the crimes chart:
"George, that's only a coincidence!" your monkey-mind will protest.
Why sure it is...you bet. A 9½ year long coincidence...yessir....just a coincidence, I'm sure...
Write when you get rich,
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,
your world may be, how do I say this? Statistically
impaired? Yeah, that'd be close.
. Seems voices in the head are (high probability)
something to do with how the two halves of the brain
communicate. The sheath between the two hemispheres has
not always been the same, it seems, and when a religious book
refers to 'hearing the voice of God' it may very well be a
communication state between brain halves with one rational side
'hearing' the side that has been suppressed and has been in
'free running' mode.
,
and even better:
,
and you're deep into grayscale. Not ready to agree with
those who are topolo9gically impaired and won't explore other
possibilities than the closed decision they've already made on
the one hand, but not ready to commit to Zeta, Arcturans, Zeta's
or whatever's on the other, but at the same time recognizing
that speaking-in-tongues is an observable fact, and DMT is pure
science, as is Ray Moody's late 1970's classic 
. 
