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This Weekend Report Business

Howdy - and welcome to UrbanSurvival which is updated on a Monday-through-Friday basis.  This being the weekend, fresh content is posted over at the www.peoplenomics.com site.  Yeah, it's $40 bucks a year, but that's how this site happens - server time isn't free (linkda like lunch, you know?).

 

The Saturday report is more or less like a weekday report here, and on Sunday there's an expanded report on a single topic and then a couple of pages of charts for those with a technical market analysis bent. 

 

The next site update here will likely be Monday morning around 8 AM central so get out and have a great weekend and stop sitting in front of a computer so much.  Or don't - this weeks posting from US follow...

 

A Daily Dose of Data

Nothing like gnawing on numbers with the more cuppa joe...much fewer carbies than a muffin, but not as sweet.  Take this morning's durable goods orders report, for example:

New Orders

New orders for manufactured durable goods in August decreased $2.5 billion or 1.3 percent to $191.2 billion, the U.S. Census Bureau announced today. Down three of the last four months, this decrease followed a 0.7 percent July increase. Excluding transportation, new orders increased 2.0 percent. Excluding defense, new orders decreased 1.2 percent. Transportation equipment, also down three of the last four months, had the largest decrease, $5.3 billion or 10.3 percent to $46.6 billion. This was due to nondefense aircraft and parts, which decreased $3.6 billion.

 

Shipments

Shipments of manufactured durable goods in August, down following two consecutive monthly increases, decreased $3.1 billion or 1.5 percent to $197.9 billion. This followed a 2.5 percent July increase. Transportation equipment, also down following two consecutive monthly increases, had the largest decrease, $3.1 billion or 5.9 percent to $49.5 billion.

 

Unfilled Orders

Unfilled orders for manufactured durable goods in August, down two consecutive months, decreased $0.8 billion or 0.1 percent to $802.4 billion. This followed a 0.1 percent July decrease. Transportation equipment, down four consecutive months, had the largest decrease, $3.0 billion or 0.6 percent to $473.1 billion.

I'm still arguing with myself if the reported increase in the leading economic indicators report really means anything, since the money supply at M1 is up lately more than the economic indicator increase:

NEW YORK, September 23, 2010…The Conference Board Leading Economic Index® (LEI) for the U.S. increased 0.3 percent in August to 110.2 (2004 = 100), following a 0.1 percent increase in July, and a 0.2 percent decline in June.

 

Says Ken Goldstein, economist at The Conference Board: “While the recession officially ended in June 2009, the recent pace of growth has been disappointingly slow, fueling concern that the economic recovery could fade and the U.S. could slide back into recession. However, latest data from the U.S. LEI suggest little change in economic conditions over the next few months. Expect more of the same – a weak economy with little forward momentum through 2010 and early 2011.”

Sure looks like an odd disconnecting is taking place...

 

Meantime the latest Federal Reserve Money Stocks measures show M1for August was still looking to be up 5.9% compared with year-ago levels.

 

After dropping 76 on the Dow yesterday a bounce today at least at the open is possible but - as always - the question is whether it will hold through the close. Next week we have consumer confidence due, GDP, Personal Income (and savings such as they are) along with construction spending as such, so the market may fade toward the close today...

 

US Takes a Hike

So the president of Iran asked something at the UN that the US delegation was not happy about:  he said there were three theories about who caused 9/11.  Can't be questioning that apparently: The US delegation got up and took a hike.  BUT there is that little matter of the Thermite residue and maybe Iranians can read, you know?

 

Hands On Politics

Brawling at the Harry Reid - Sharron Angle forum, up in Nevada.   Reid was doing his part from Washington while Angle was there in person.

 

Crooked Royalty Department

The UK's Independent is outing how the "Queen tied to use state poverty fund to head Buckingham Palace."  Like the royals of Euro land don't have enough m oney?  GMAFB

 

Ending the Free Press

You see where Saudi Arabian will be required to get a license to blog?  If this happens, no doubt every other government in the world will try to go down that road.  That, too, would be 'whites of their eyes'...

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Government is already angling for a 'secure zone' on the net for government - and financial services.

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And as a reader noted about yesterday:

Sep 23 1950 Congress passes the McCarran Act, also known as The Internal Security Act of 1950, overriding Harry Truman's veto. The act provides for severe restrictions on civil liberties, suspension of free speech, and placing of undesirable Americans in concentration camps. The act has never been repealed.

Say, as long as we're talking about Acts and such, how can federal employees even broach political dissenters which seem tgo be in-process of being smeared by the PTB for expressing dissent?  The Hatch Act of 1939 "..prohibit(s) federal employees (civil servants) from engaging in partisan political activity."  Would they claim the Patriot Act overrides Hatch?  Hmmm...

 

Some Award

That congress is finally getting around to honoring Japanese American vets who fought for the US in WW II is a good start.  But as one reader noted, kinda cheap on the government's part to given the individuals bronze knock-offs of the one real gold medal, isn't it?  Why am I not surprised, though.

 

Hiding the News

Reader tip:

Hi George, Virginia state employees were informed two weeks ago that an disastrous audit report on the Virginia Dept. of Transportation showing widespread financial mismanagement would be released on Sept. 22nd. We were warned this would make the national news. Lo and behold the report was not released until today, Sept. 23rd. Why? Virginia is executing the first woman since 1912 tonight. Nothing like a bigger story to mask unpleasant news. I am really interested to see if this audit report makes the national news. I think not. Oh, the games that are played....

So sure enough, the Virginia crying poor while under spending $1.45 billion on roads was not making national news...

 

Stuxnet Warfare

So, is 'stuxnet' the ultra-cyber warfare weapon off to attack Iran's nuclear reactor control systems?  Or, is that just a ploy to draw off the West's attention and get our guard down till it comes after us?  Several good novel plots in this, one is likely to come to a world near you, anyway.

 

Nothing to Fear Dept

Oh, so now there's nothing to fear from solar flares in the post Cycle 25 high from Solar Flares in 2012-2014?  Gee, that's comforting.

 

Forecasters are not sure what to make of the recent solar storm directional changes, but sure seems to fit the 'angry sun' expectations...

 

 

(continues below ad)

 

 

 

Coping:  National 'Beat Up George Day',  Refried

When I post ideas on this web site - as with my proposed nominees to head up the National Economic Council and replace Larry Summers who's going back to school to teach in January - it is always with the idea that it will get people to thinking.  Which it has - some very good thinking, indeed.

 

But, along the way some people reveal that they don't have the capacity to 'kick around ideas' without getting a huge emotional investment in one point of view and letting that investment get in the way of exploratory thought.  In fact, several readers promised that my tossing around names like Joe Stiglitz and Paul Krugman for NEC chair would result in them going away and never reading UrbanSurvival ever again.  Fine... but I got to thinking last night that their decisions to go were the mark of a growing trait in America:  Intolerance of a different point of view.

 

Here's a sample email from one of the departed:

"Your page is proving as useless and counter-productive as it's ever been. Squeezing something out of the dying victim for yourself and helping other people maintain the same idea is still looting and pillaging. You are a pathetic excuse for a human being, and like the rest of the boomers, you not only cherish all the characteristics of the PTB, but you actually promote them.

It's become a bit of a struggle to make your contrived data analysis report look like its accurate, hasn't it? Anything of real use or power that comes your way gets hoarded, abused or both. You routinely make profit of anything you can get your greedy hands on; it doesn't seem to matter how much it would benefit humanity if you acted in the best interests of others instead of yourself, you will pick your greedy little self over humanity every time. This is why the future will despise you, and why you will never survive in it.

Like most people in your generation, you are a traitor to your race. You are the single point of failure - when the ball was in your court, and you all came into power and had the awareness and the choice to do better, you fucked off. Nobody since your gen has had such an opportunity to change the world for the better, but instead of doing the right thing, you signed on with the PTB and raped the children of the future.

Keep on going with your selfish looting, raping and pillaging, George. Withhold the valuables, sign your name on other people's work, charge for everything, and make a profit as the world goes up in smoke. You will die badly in this mess. When your considering the cesspool of your life, remember that you were cautioned many times about your behavior and your choices. Remember that its not what you get to have, but what you can put out that makes a livable world. Whenever people become vampires like you, the world dies."

Naturally, I wrote back asking "I must have missed your website which you provide free, hold yourself out for abuse on, and share freely. What did you say your URL of YOUR works of good was on? I musta missed it…"

 

I'm somehow NOT surprised I haven't received a reply yet.  I also don't expect this reader to understand the horrors that would go with catastrophic economic change.  That seems to be a common thread of 'people checking out' of UrbanSurvival.  Here's another note from one of the departed:

"...However, today I must respectfully point out my view regarding your comments on the sudden failure of the global economy. You said:

* The ATM doesn't work.

I say, so what, I never use them anyway. It's a waste of a $2 or $3 fee.

* There's nothing in stores within a week or two.

I say, so what, I've got 4 years worth of food stored, 5 years worth of annual heat, a large garden, plenty of hunting supplies, 12kw of functioning solar panels, a 300' well with 30gpm recharge rate, and have no need for the latest gadget produced by Apple. "

This reader may have missed a huge macro trend which is changing which Jack Lessinger and others have noticed:  We're at the boundary layer of a massive change from the "Me, me, me" society which will morph or evolve into the "Us, us, us..." society.  It's part of what Clif's work shows as the Self-Organizing Collectives (SOC's) in linguistics for what's ahead and what will work as a community/group survival strategy.  It's also why cooperatives may be the next big business model because they can operate on either a goods-benefit or monetary-benefit basis, or in transition periods as a mixed-mode economic system.

 

My offering back to this reader is "Sure, YOU don't need the ATM but when you go to Wal-Mart or Safeway sometime, count the number of American families that depend on ATM's working to get food for the dinner table.  And, what's more, just because YOU have four-years of food, what about the 200-people closest to you in your community?  Even the most well-armed survivalists and preppers have to recognize that they need to sleep now and then and that a collapse of existing social frameworks will be the most horrific times in America's history; at least as bad as the US Civil War, except it won't be fought around a moving front.  It will be national in scope and international in impact.  Almost certain to cause a global die-off of some significant size and to the extent there are migration paths around that, seems to me any reasonable human would investigate those closely before going off on a "Bring on the Revolution!"  "Bye-bye George, you idiot!" tangent.

 

That's precisely the kind of thinking that has given some basis in fact to Department of Homeland Security concerns that the extreme survivalists may pose a threat to America.  It's one thing to sit out (as I do) in the outback preparing as time and resource allows for extremely hard times to come.  But, it's quite another to actively foment revolution.

 

Which brings up a delightful exchange I had with a reader who is NOT leaving.

"George, I believe the plan you lined out for 40-50 years is the plan that is ongoing from the PTB. As Roubini said death by 1000 paper cuts. And a slow redistribution of wealth so that the world is turned into an equal footed Socialistic Utopia under a global government or at least governance. That is the plan already in the works. Wealth is already being fleeced from the US as we speak while China and India grow. Krugman, Summers, Geitner are all part of the same gang and certainly take their marching orders from Rockefellers/Rothschilds. I think this is what they are trying to do so there is no immediate world revolt. The problem I have with it is that yes it makes things a little easier on the way down and Gold won’t be 50 an ounce yet with the need of body guards. But you can’t escape the truth or the fact that those days are coming. "

The key difference between this fellow and 'the departed' was that he's able to kick around ideas without getting emotionally invested to the point of blindness.  Since his telephone number was on his email, I called him up and we chatted briefly and I respect his opinions. 

 

The really interesting point of our conversation was the question of 'when" does the big change begin?  He shared this from Patrick Henry written in the pre-Revolutionary War days:

"George this is an excerpt of Patrick Henry’s speech. Feel free to post this if you want to reach those people on the edge of going nuts. I think it is important to do so. This is evidence enough right here that now is not the time for violence. Now is the time to win at the Ballot box. This speech holds as true today as it did then except we are at the very beginning of the struggle. The highlighted areas prove of years and years of pleading to stop the tyranny. He also says to boot that they didn’t have the power of elections to change things and that is why they must fight. Here is the important part of the speech: Very important stuff in context of what is going on today. We are nowhere near the point where Patrick Henry was. We are at the start of where he was probably in the 1760’s.  [highlighted area follows - g]

"Sir, we have done everything that could be done to avert the storm which is now coming on. We have petitioned; we have remonstrated; we have supplicated; we have prostrated ourselves before the throne, and have implored its interposition to arrest the tyrannical hands of the ministry and Parliament. Our petitions have been slighted; our remonstrance’s have produced additional violence and insult; our supplications have been disregarded; and we have been spurned, with contempt, from the foot of the throne. In vain, after these things, may we indulge the fond hope of peace and reconciliation. There is no longer any room for hope. "

America is still, in my view, some distance from that tipping-point.  Whether an economic collapse is what's coming the week after elections, or even next year remains to be seen, but for now, I think the most important thing people can do is organize for elections in November.  That's how change happens in America.  And, asking questions like "Are you willing to immediately resign your position in mid-term in the event you break your solemn contract with We the People to act in our best interests and NOT those of the PTB or the corporate interests that will come trying to seduce you with money and more?

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Let's pause here for a Reality Check.  Just because I toss out two names like Stiglitz and Krugman doesn't change the possibilities of either getting the nod.  It won't happen because as I said a couple of days back "These guys 'get' it..."

 

Yes, Krugman would be likely to bring on a massive inflation in order that accumulated national debts would be reduced.  The short-term bad news is that yes, it would clause hyperinflation in the cost of living.  That's the bad part.  But the good?  If you own a home, and there was a 10-tyimes increase in the money supply, you'd be able to pay it off for effectively 10-cents on the dollar.  Would that be preferable to a revolution?  Any day, to my way of thinking.  Besides,  that would add a zero onto the price of gold and silver pressing them to $13,000 an ounce for the one and $2,500 an ounce for the other. 

 

My advocacy of a transition period as long as 40-years is because there are real estate contracts that go out that far.  The bulk of a hyperinflation would be over in 3-4 years as was the case in the Weimar example.  And yes, it would torpedo the US dollar in terms of international trade, but the very phenomena right there could spur domestic production and reduce the balance of payments deficit.

 

Still, if Krugman's approach isn't satisfactory, I can think of other good names to toss into the hat:  Ken Rogoff and Carmen Reinhart wrote a dandy book called This Time Is Different: Eight Centuries of Financial Folly which is a savory read.

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A curious thing showed itself out of the emails yesterday - which I think is indicative of a dangerous undercurrent:  There were many emails which attacked Ivy League schools as being bad..  Several emails laid much blame at the feet of Princeton, Harvard, and Yale.

 

Brings up another thought:  Is the public becoming "Anti Smart People"?

 

True, there are some mighty 'clubby' things that go on in such schools, and yes, the American Aristocracy tends to get a disproportionate numbers of their kids into such schools, but on the flip side of it, the academic reputation of such places is well-deserved. 

 

What's more, A friend of mine for almost 60-years has a son attending MIT doing his masters there because that's where the 'best and brightest' go.

 

Not to say that the undercurrent of 'anti smart people' isn't somewhat deserved, but is it natural for really smart people to congregate?  Something to ponder.

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Yes, there probably are better picks than the names I've tossed out - these were pulled from readily available writers of books on my bookshelf and was a knee-jerk reaction to the list of names floating about to replace Summers, a list which included 100% corporate faces most of whom has not clue one about what the macroeconomic trend is (depression evolving).

  

One of the best reads was this from a reader who is NOT leaving:

"George,... I admire your ability to be so completely immersed in the present and future truths, geopolitical and otherwise. However.. you must realize that all the angst about Krugman/Stiglitz et al is a colossal waste of time. There is no one.. repeat NO ONE.. and no group who can fix the world economic mess. It is all based on expansion (and cheap fuels), on empire building, and that is done. In fact it's past done. We are eating our own legs. A huge percentage of what people do to make a living are totally useless endeavors, way beyond food, shelter, clothing and a bit of entertaining cultural excitement mixed in, low-tech music, dance, art, theater and all that. There will be, and you know this, a complete breakdown, collapse, of the present paradigm. It is already breaking. Anyone with a lick of sense is already preparing, as you are, for local self-sufficiency, local governance, resistance to outside interference and/or exploitation.

 

Even the effort to make a buck on the ups and downs of the markets is a waste of energy, unless all profits are translated into durable, survival tools and goods, like alternatives to toilet paper. (That's really just a life-style change, since people all over the world do without our style of personal hygiene already). But it's a learning curve which starts with abandoning the "salvation through legislation" mind-set. There will be absolutely no solution, no salvation from the US Government, and probably very questionable efforts by state governments.

 

Debates about who would be the best next "financial czar" or "drug czar" or any of that are as vital to our future as the outcome of Dancing with the Stars. Along with that I offer my speech that I make to all my conscious friends here in the NC mountains.. that all technical preparations, generators, solar power, any internal combustion, etc. are at best temporary fixes to the coming changes, the coming chaos. Those who survive will be those who know how to get-er-done as they did 100-200 years ago, without fossil fuel or fossil fuel products.

 

The list is long and the learning time is long. There is no time to be debating economic theory or figuring ways to get 100 mpg out of some car, to drive where? To do what? make rope. Learn how to use human and other animal power. Teach your dog to pull a cart. Goats do that, too. OK, down off the soap box. You've been a great source for me for 9 years now. Thanks for that. Can you make fire without matches? I can teach you that. You'll need to know.

And that's the essence of it  Yes, I spark-start a fire every couple of weeks and I have a dozen old Altoids boxes with fire tinder in 'em and everyone here at the ranch has a fire-striker and know how to build a fire in the woods.  And we all carry good knives and we all know the risks.  And so on.

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People wonder why we sold our goat herd:  Economic answer: Wintering over the herd was going to cost more than their short-term economic benefit, especially because we all may need to 'go mobile' in November.

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The one thing that's clear is that America's in trouble.  This weekend's Peoplenomics report lays out some of what's ahead as America goes the route of a third world nation. 

 

Just one number from the report because it's an eye opener:  According to the most recent data in the World Bank's database, the amount of wealth held by the richest 10 percent of the population of the population in Ecuador is 43.3%.  In Bolivia, the richest 10% of people control 45.3% while further south, in Chile, the top 10% control 41.7% of wealth.

 

I then went on to look for data about the United States.  The data wasn't there.

 

"My, ain't this odd?" I got to wondering and (as an old newsman suspicions are something I've learned to trust) so I dug around on the net.  Lo and behold, here's the dandy website of Prof. G. William Domhoff of the Sociology Department  at the University of California at Santa Cruz with the answer.  Sitting down?  Blood pressure pill ready?

 

83%.

 

That's probably why the World Bank doesn't publish data like that, because that is the kind of data that fuels thoughts of uprising and rebellion.  But there you have it - worse than 3rd world data.

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There's an old Johnny Horton tune that maybe Gen-X and younger ought to listen to before deciding the Boomers (like me) are too passive and not moving fast enough to fix things up with a major forced redistribution of that concentration of wealth at the top  (the word communism mean anything?). 

 

The tune was the "Battle of New Orleans" and it has some dandy instruction in basic tactics here:

"Old Hickory said we could take 'em by surprise

If we didn't fire our muskets 'til we looked 'em in the eye

We held our fire 'til we see'd their faces well.

Then we opened up with squirrel guns and really gave 'em ... well..."

For those who want to push America into instant collapse to 'get it over with' believe me, I understand the urge.  He's another expression of frustration:

Dear George,

You said: "I am a gradualist who believes that change of a meaningful type can be brought to the system only so fast."

You are wrong. <-That big fat dot is a period. Had the so called PTB gone ahead and let the system collapse after Lehman ( or before), we would have already been well on our way to a better system by now. What we have now is a slow death that may take another whole generation to play out. The pain is only obfuscated by time, not diminished. For an old guy like me, it means a life sentence. And by now, the festering pustule that has now swelled itself into public view (the Tea Party) may well explode it's unorganized slimy self into all sorts of unseemly dark places to foment even more pain. Damned the fix, it's time to start over. When the real men write up a doable, sane plan and stand up to take back the country, let me know would 'ya? Take me to their leader. I want to join. I'm done with this slow bake. And this from a man whose business is going gangbusters, mind you. I am still mad as hell and I want my Constitutional America back.

Well, so do I!  But playing a lot of chess as a kid and later coming up in life I learned what I think is the best tactic of all:  OFBYCW:  Only fight battles you can win.  I don't see the 'whites of their eyes' yet.  Congress has been 'bought' and the only thing that makes sense is to vote them all out.

 

IF the week after elections, the PTB try something really stoopid (sic) - like refusing to sit the new members or pass 'unchangeable laws' in the lame duck session, then THAT is your flashpoint.  Nov 8 to 12?  We'll see.  Another reader note:

"Aye George,

There is no future path to responsible Capitalism.

Obama's handlers have shown us the path to change. It is through redistribution of wealth [assumption: America has too much wealth] Justification is: social justice

Will our Congress and President bring us back to some level of what the common man calls normal? No......they have chosen the path of the social progressive [socialist] which is the fore runner of communism.

The USofA financial system is set up to fail as part of a plan. Ultimately the USofA is faced with an austerity that will be draconian.

What is the plan for this austerity? The plan is "The Shock Doctrine: The Rise of Disaster Capitalism "--- the book by Naomi Kline.

Its results are civil chaos, financial destruction of capital and capitalism, political instability, major changes in the form of government [the Constitution in our case] usually associated with martial law.

Get ready.....someone is bring to you on the big screen of life a real event called MAD MAX.

So prepare your grave [dig a hole], have a head stone made of soap [so any trace of you will be gone in a short while] and made a coffin from pallets [the trailer trash kind of thing] and line it with burlap and and a dogfood bag stuffed with paper money.

So we watch and wait...false flag excuses are my greatest fear.  They could bring "the moment."

 

But remember that "Moment" may be spun offers another wide-ranging reader/thinker:

"Now getting widespread exposure on mainstream media. Some fringe websites I follow seem in unison on some points and offer the following...

- our galactic friends will not allow any further nuclear detonations, on earth or in the upper atmosphere

- they also will not allow another major war to happen - Iran will not be bombed, at least not on any major scale

- they became alarmed at the nuclear bombing of Japan in WW2 as nuclear weapons not only are capable of destroying the entire world, they disrupt interplanetary life in some ways, plus have a destructive effect on souls at the centre of such explosions which requires extreme measures to rectify. The Japanese nuclear destruction was heard all over the galaxy thus the increased appearance of various UFOs since that date as they came to investigate.

- the PTB intend to stage a "Fake Invasion" of "aliens" (the reason for the "Space Wars Project") as their final ploy to complete their takeover of the world ie One World Government according to Wernher von Braun... "

What's the old Chinese curse about living in interesting times?

 

In the end, I suppose Stiglitz and Krugman would be just as lousy as the put up corporate names.  Didn't want to think so, but reading about Stiglitz in the article here, exposes a much different view than what's in his books.

 

Makes me appreciate that more and more, we live in a world of 'sectored messaging' where persuasion groups are blocked and different messages delivered.  I'm just as subject as the next person to getting that wrong from time to time.

 

The more I delve into it, the more it all smells of strange cross between the simple effects of compounding interest and a 'rubber meets the road' plan of the PTB to 'manage' the situation in their favor.  With already an 83% share of ownership of financial assets by the top 10% of high income/American Richies - a/k/as the American Aristocracy.

 

So, where does this leave us?  All that much closer to step 3.5 - the planned riots which lead to even further control and the third worldization of America - which is what we get into in Peoplenomics this weekend.

 

Barter Site List

No cash?  Got something to barter?  A skill or something like that?

Try here: http://www.gigafree.com/barter.html

 

Another 2012 Hint?

How's this one:

Hey Dude, Ever heard of a Neutrino telescope? I hadn't, but check out this HIGH QUALITY Russian setup. Interestingly, the film 2012 begins with a neutrino detector in an Indian mine. That installation was of a similar standard to the Ruskies, with a bit of Delhi athletes village thrown in (literally) for good measure.

So we watch for October 26-28 for a sun disturbance as the next clue...

 

More tomorrow for Peoplenomics readers...otherwise, see you Monday...

 

 

Send your comments to george@ure.net

 

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Reader Action Department:

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"Live on $10,000" A Year

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Pass It On

A different take on things - that's what you'll find here most mornings.  If you know of anyone who might also like our content, simply click here and send a link to them.  Or, if you hated what you read, send the link to all your 'worst enemies'.  Like they say in Burbank, "Ain't no such thing as bad press..."

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Last week's report is always here

 

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Thursday September 23, 2010

Slide Continues

Word that overseas markets are sliding is not anything of a surprise, since the 'hesitation in volume' which may market significant market tops that was outlined for Peoplenomics subscribers last week may have arrived...an update this weekend on that.  But for now, all we need to notice is that Europe is down and gold and silver soften a bit earlier but the pop in unemployment numbers bounced it back...more on that in a sec....

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The idea that gold and silver could run counter to a major market decline is an interesting notion - one that I'd profit handsomely by - if true, but alas, when there's a market decline all assets tend to get sold to raise money, not just the losers.  So, if the top is in, I still would not be surprised to see gold and silver drop to the $1000/$16 -$17 range; not that I'd wish it, but that seems to be how macro economics will work in spite of common sense.

 

The run to new records in gold and silver will come, of course, but not till the government really turns on the printing presses to hyperinflate away the Second Depression which is still solidly in place.  Yes, gold may drop some, but I still wouldn't sell any.

 

Sliding Jobs

Another nail in the coffin of the market (besides bank fears and bond issues in Europe which are on simmer for now) there's the little matter of jobs:

"In the week ending Sept. 18, the advance figure for seasonally adjusted initial claims was 465,000, an increase of 12,000 from the previous week's revised figure of 453,000. The 4-week moving average was 463,250, a decrease of 3,250 from the previous week's revised average of 466,500.

The advance seasonally adjusted insured unemployment rate was 3.5 percent for the week ending Sept. 11, a decrease of 0.1 percentage point from the prior week's revised rate of 3.6 percent.

The advance number for seasonally adjusted insured unemployment during the week ending Sept. 11 was 4,489,000, a decrease of 48,000 from the preceding week's revised level of 4,537,000. The 4-week moving average was 4,519,500, an increase of 2,500 from the preceding week's revised average of 4,517,000.

UNADJUSTED DATA

The advance number of actual initial claims under state programs, unadjusted, totaled 379,369 in the week ending Sept. 18, an increase of 37,705 from the previous week. There were 437,543 initial claims in the comparable week in 2009.

The advance unadjusted insured unemployment rate was 3.1 percent during the week ending Sept. 11, unchanged from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 3,891,808, a decrease of 42,132 from the preceding week. A year earlier, the rate was 3.9 percent and the volume was 5,223,904. "

Leading economic indicators (LEI which I'm convinced is an anagram) are due out within the hour.  Home sales, too...

 

Where's My Decoder Ring?

Is there some kind of a secret wink-wink, budge-budge to be had from study of the stories about how TARP administrator Herb Allison is stepping down?  From running a $700-billion fund...  Or, is this normal course of business?  Sinking ships rattles around somewhere down in the preconscious...yesterday it was Summers...now it's....oh just thinking....how many economic types/czars, etc. are there, anyway?

 

Harsh Reality Dept.

Say, here's one to get under your skin:  The government watchdog agency on bailouts figures that GM stock would have to go to $133.78 in order for the government to be 'made whole' on that particular bailout.  Of course if you have a long memory you'll recall that GM stock only ever hit $93... OMG are you a generous taxpayer, huh?

 

Block Busted

Blue & yellow vid store chain goes BK...but they will stay open while they go through a reorg.

 

Trotting Out Terror

Once again, the word is out from officials that terrorism risks are rising.  Much fear and trepidation whipping's being done on the rising risk of small-scale attacks in particular.

 

Pardon me for asking, but is this supposed to make the 72-hour permission to travel more palatable, or what?  At some point, doesn't a police state become so unpopular that it spawns its own demise?  Just asking....

 

Trade War

Say, this China-Japan thing keeps heating up with China taking the extraordinary step of blocking vital exports to Japan.  You don't suppose this could lead to a shooting war between them, do you?  Oh WTF's another war, huh?

 

Textbook 'Bias' Vote

Down here in Texas, there's a key vote tomorrow on whether Islamic bias in textbooks should be banned.  Texas has a very large influence (due to size of the state) on what textbook manufacturers put in their books and suggested curriculum...

 

Problems of Aging

Interesting story about how an 84-year old WW II vet got a broken back from a police officer...  Interesting thing is that most police departments don't differential in their 'use of force' policies to account for age... Hmmm...

 

Coping: You Say You Want a Revolution?

Several readers took me to task for recommending president Obama consider either Joseph Stiglitz or Paul Krugman to head up the National Economic Committee when Larry Summers goes back to teaching in January. Some samples of OPT (other people's thinking) here:

"Stiglitz: / World bank This slug is responsible for the financial rape of every developing country on the planet.

HELLO EARTH TO GEORGE."

---

"George, Krugman is a raving Keynesian!!!!!!!!!!"

---

"George

You are kidding me, right?

Wow, you are setting yourself up for some ugly hate mail

I will be nice, and chalk your enamor with Krugman up to a bad batch of bean

Probably one of the worst corpgov economic shills the world has ever seen

Definitely in the pocket of the PTB

Now, had you said someone who USED to be associated with Princeton, Martin Armstrong, well then....."

Even my deflationist pal Jas Jain piped up:

"...Just today I happened to get the latest issue of articles by Stiglitz & Co and they have debt solutions for every conceivable economic problem. Music to the ears of Financial Nazis of America. Don't underestimate the academic branch of Financial Nazis of America. Rulers need priests that provide justification for their rule! Does anyone think that Reagan, GW Bush and Limbaugh know chit about economics and economic policies? Financial Nazis know this and have used these simpletons to advance their agenda...."

This may be really hard to follow, but hear me out on this:

 

Yes, both Stiglitz and Krugman are (more or less) conventional economists.  HOWEVER it's critically important in my view that we consider what the desired outcome is.

 

Don't know about you, but the complete and utter destruction of the global financial system is NOT my cup of Tea. nor would it be a Party.  In this sense, I am a gradualist who believes that change of a meaningful type can be brought to the system only so fast.  Who better to accomplish gradual change than people who really understand what is at stake here?

 

For as long as I've been studying and writing about the economy, I am surprised that more people don't consider what a world where the global economy has failed would be like.  That's what's at stake.  In case you haven't penciled it out, let me give you some concepts to really snuggle up to to see how they feel:

• The ATM doesn't work.  That's because in a global economic meltdown, our trading partners would not accept US Dollars for anything - which BTW includes oil.  That means no energy to run coal mining and that in turn shuts off a huge portion of electric power generation.  Banks go bust, the markets collapse - there's no clearing and commerce seizes up within a week or two.

• There's nothing in stores within a week or two.  The overseas vendors who provide a good bit of the legendary 6,000-mile long Cesar Salad would stop selling us goods.  We are a net food importer, or hadn't you noticed?  Can you survive off your garden?

• Electronics are gone (since the power's been off).

• Since paychecks in such a world would no longer buy anything meaningful, how long before government services fell apart?  I mean, think about no more prison guards going to work, no more police and fire responding to 9/11 calls, no more welfare - and that includes no Social Security - and no more maintenance of any kind.  The military just sort of 'walks away' in Anasazi fashion (The Anasazi being an example of how a rapid change caused a whole high culture to jujst poof! -  disappear...) wherever they happen to be when the collapse happens.

• Farmers no longer put crops into the ground, and with no diesel or petroleum to make food goods, no diesel to run trucks, etc. within a year we're out of food and on starvation's doorstep.  Want to be a fine young cannibal?

• Absent cops, fire departments, and paramedics, there's no one to defend you from killer gangs.  But I suppose that's OK since without a functioning economic system there's no water to drink and no medical care available.  We quickly go back to a world where people with asthma and diabetes die within days or weeks, and where a serious injury (think gang-administered gunshot wound?) last only long enough for super-bugs to kill since the pharmaceuticals are all made overseas and those folks no longer take US dollars...

• The good news?  There won't be a lot of traffic.  That's because as the dollar fails there'd be no reason/incentive to go to work, especially because you'd need to be watching your family every second and they'd need to watch your back in return.

And then it gets worse from there.  Long-term recovery becomes a joke because the modern world we enjoy for its basic conveniences never-before-seen in history (think of toilet paper for an exam ple) are all gone within  days to weeks.  The movie "The Road" (which I assume you've watched) gives a reasonable look at how the reality might work out.

 

Oh sure, the price of gold may be $50,000 an ounce, but what's the flip side of that?  You have to hire a gang of bodyguards to protect you and as soon as they figure out where your gold stash is, they'd just as soon shoot you as not.

 

So when I got emails such as this one...

"Good morning, George,

For the life of me [and the future of my children and grandchild], I can't understand why you proposed Paul Krugman as your second choice.

Kindly go to www.professorfekete.com,  read the most recently published article by this Hungarian who lives and breathes hard-money Austrian economics---and educate yourself about the economic ignorance of your candidate, paper-money-printer Paul Krugman.

Your Krugman-recommendation is totally out of keeping with your efforts to protect Americans from the follies of paper money!!!"

...I ask myself "How do we get from where we are now to a more reasonable economic world?  Is there a migration path and who understands the past behavior of economic Depressions?"  Stiglitz and Krugman.

 

The only way that I can figure to get from here to 'thar'  (the new Holy Land of responsible capitalism) would be a 40-50 year global transition wherein individual countries announce their allegiance to the only plan that makes sense:

• A long-term phase out of debt more than x percent of GDP (plus the total phasing out debt financing of government etc)

• Implementing convertibility of currency for gold & silver BUT

• ...also implementing conversion to calories (energy units).  All phased in so markets can adjust and jobs and other variables follow...

• Start stripping out all taxes on goods made for export and then over time..

• ...installing tariff's on incoming goods to implement purchasing power parity which 'declaws' the PTB who are profiting enormously by working the global wage-rate differentials.  This would bring jobs home.  Oh, and rein in globalists.

• Install a maximum entity size on companies to X revenue, prohibit personal incomes higher than $10-million per year (OK, $20-million if you must), and end all laws which give corporations preferential treatment compared with humans.  On ly humans could donate to political causes and then all contributions would have to be reported real-time.

• Re-implement the concentration of media rules which have provided for simple PTB control over nearly 100% of US media content.  Dug.  As long as we're fixing the broken media mirror with which we think we see ourselves, bring back (phase in over 5-years) prohibitions on owning a print media outlets in the same market where there's a TV or radio owned.  Bust radio and TV ownership apart and on and on...

• Just as the ATT break-up didn't hurt kill the telecom industry, I'd expect 'breaking up' the media-meister's (and limiting their 'take' to $10-$20 million per year personal incomes would be a good thing...

The objectives of such a system would be to restore American manufacturing and the foreign purchasing of only critical raw materials.  Placing a global limit on accumulation of wealth beyond the share-a-Gulfstream kind of income level, and provide for the disassembly of monopolies would put an upper bound on income disparities between the ultra rich and the ultra poor.

 

I figure that free market capitalism is a fine thing...up to the point where it starts seriously abusing the ecosystems of the world.  Then, it becomes ridiculously nonlinear.  That's the how and why we have the elitists/New World Order types off defending their monopoly at the top.

 

I am a huge supporter of free-enterprise and the Constitution.  The reality of the problem is that as we are approaching the 'limits to growth' we are seeing the PowersThatBe morphing into the really sick kind of global elitist aristocracy which does everything from manipulate currencies for personal gains at an obscene level to funding national political organizations in order to keep the right/left charade going so no one will notice the excessive wealth, power, and control collected by the very multinational elite few who own things like those 250-foot yachts and such.

 

The reality is that the crowd which preaches "free market" really only means free for those on top.  This is why the PTB will go to the very ends of the earth to find someone in a TWSH (third world shit hole) who will underbid you.  The lower the bid for the work and the higher the retail price in America the more wealth, power, and future for themselves and their evil spawn they ensure.  (Or so they'd like to think...)

---

I was talking to a friend of mine yesterday (PhD level guy) as I'm working on research for this weekend's Peoplenomics report and he said near as he could figure, there are only two ways out of the current direction in global economics:

 

a)  Set up a permanent leisure class which would consume the excess production and migrate the economy.  Just in the last 15-years the number of workers required to feed, clothe, and shelter Americans has dropped in half and while many jobs have gone to Asia, automation continues to nibble away employment.... OR

 

b) The only other alternative is a well-planned die-off.

 

My friend - an optimistic sort of fellow - would like to see the permanent leisure class solution. Me too.

 

I'm a little less optimistic, however. 

 

For example, I see the setting up of seed banks and such (by the ultra rich)  as an insurance policy so that when they (the PTB) get done with 'blowing up the whole world for personal gain' that they and their blue-blood offspring will be able to do a 'cool restart' and automate the entire world to serve the surviving elites.

 

Which is why so many elites talk socialist while acting fascist.  Once they get rid of the chattel (the powers than ain't - PTA - which is you and me) they will then have an almost fully automated renewable energy powered world, where they will live a semi-Utopian existence with seed stocks going in now.  A few servants will be kept, of course.

 

When you look at things from the perspective of  "The Limits to growth: A report for the Club of Rome's Project on the Predicament of Mankind" you come to appreciate that when this report first came out in 1976, it was an interesting discussion of how population overshoot would push the world into unmanageable size.  What's in plan now is the active planning part.

 

More recently, I've added Limits to Growth: The 30-Year Update to my reading list because the original report was more of a foundational piece which outlined the post population reduction (PPR) levels which some place at 500-million humans.  Scary number, that:  It means about13 out of 14 people have to be somehow removed (e.g. made dead) and the load on the planet reduced.  Growing the third Worlders only ramps up the birth rate, so they have a kind of built-in 'use by" date. 

 

I've also got Herman Daly's Beyond Growth: The Economics of Sustainable Development on my list since there's a critical thing to notice here:  As long as there remains a viable path into our shared future which incorporates a sustainable business model and doesn't get past the carry-limits of the planet, then there's hope that a PTB-planned die-off can be avoided.

 

IF THAT critical threshold is passed, then whoever is at the top of the heap and planning to survive would right now be putting away things like seeds and such.  Oh, and thanks to the well-funded-by-elites environmental movement, they're able to do that in plain sight while the future victims of planned collapse and population die-off cheer it on.  Nice planning, huh?

---

I propose as a thought exercise, we ought to carefully consider at all times first the macro layer and only then work down into the day-to-day news headlines.  As above, so below kinda thing.

 

My read of current events is that there are some metrics which could be modeled to represent the threshold beyond which the payoff to the PTB/ultra-rich elites for orchestrating a planet-wide dieoff has a higher probability of a payoff than the completing the muddle-through gradualist path folks like me would prefer.  Once there, we've sealed the fate of 6.5-billion 'useless eaters' and the button gets pushed.

 

So yes, the raving Keynesian or the ex-World Bank slug are still my picks.  Once that migration path payoff shrinks below the planned die-off option's payoff, life as we knew it is over.

 

Do I need to mention that our collective fate may already be sealed?  And maybe that's what the data for Nov. 8-12 and the many months of grieving thereafter is about in the predictive linguistic data?  All those body part references and such?  Sure hope not, but it keeps me awake nights.

 

So do emails like this one:

"Another webbot hit...

“…two words send immediate shivers down the spines of government officials across the world: Food security.”

“If the next few years could be more volatile, the next few decades could be downright frightening." The most urgent issue confronting humanity in the next 50 years is not climate change or the financial crisis, it is whether we can achieve and sustain such a harvest," said Julian Cribb, scientist and author of "The Coming Famine."”

“…hundreds of millions of refugees wandering the globe looking for food and shelter.”

Yeah, well, like I said, when the one payoff path fails....  Curious things to be thinking about as the much-hyped "Clinton Global Initiative" meetings are on in NYC...

 

Laughing Man Watch

Email:

"Hey George,

This morning on CNBC, at the end of Erin Burnett and Mark Haine's show just before 11AM Eastern time, there was a segment where they kept showing a loop of Jeff Bezos, the CEO of Amazon.com, laughing, over and over and over. It was weird, and I immediately thought of the Laughing Man from the web bot. Hopefully you can find a clip of it to watch......

Keep up the great work!"

Better to laugh than cry, I 'spose...

 

---

Wednesday September 22, 2010

Summers' Over

I'm not sure which I got more email about Tuesday:  My typo which declared me a but-job  (I've since corrected it to 'nut-job') or my jumping the gun on the declaration of Fall, which as 1.3-million readers pointed out doesn't really begin until today.

 

Or does it?

 

Maybe I was channeling the news that Obamanistas economo-meister Larry Summers was stepping down - so my "end of Summer" declaration a day ahead of schedule was not entirely incorrect (although mostly...) - maybe just missed the trailing 's' on my report.

 

Summers is not out just yet: he'll be leaving in January which means whatever the 'ugly spot' in predictive linguistics coming Nov. 8-12 window is, he'll still be here to catch the fall-out from it.

 

Already in Washington, there are whispers going around about who Obama might pick to replace summers.  Once again, the top candidates I'd put forward are not in the running and instead we finds lists which are populated by corpgov marvels.  Not that they each couldn't do an average job of things, but seems to me we need a little better than average about now.

 

I'd start my candidate list with Joseph Stiglitz from Columbia University. Besides little goodies like a Nobel Prize in Economics and having done a stint as chief economist of the World Bank, Stiglitz has written a book that screams "I get it!" more than anything I've seen by any other candidate.  His book Freefall: America, Free Markets, and the Sinking of the World Economy is presactly on point.

 

If that doesn't convince you that Stiglitz "gets it", consider some of his other recent books; the title alone scream you-know-what ("I get it!"): The Three Trillion Dollar War: The True Cost of the Iraq Conflict and sounding a bit like my references to the fact anyone over 40 has likely lived through the heyday of humanity, his book titled The Roaring Nineties: A New History of the World's Most Prosperous Decade sums that up nicely.

 

Of course, now that I write it down, I suppose the reason Stiglitz doesn't have a chance in hell of going in Summers' place to call the economic shots is that he knows the issues, sees the data clearly, and can't be bullshitted, not does he offer any in return.  What's the old Dragnet line that Sgt. Joe Friday used to say?  "Just the facts, mam..."  Yup, no chance in hell.  America has moved well beyond living on facts.

 

My #2 pick (any it was a close call, frankly) would be Princeton's Paul Krugman.  He's another Nobel Prize winner in economics - and like Stiglitz, the books he's authored also scream "I get it!".  Take for example The Return of Depression Economics and the Crisis of 2008 or even closer to the mark and more pertinent than ever: A Country Is Not a Company (Harvard Business Review Classics).

 

But, once again Krugman may doomed because there's a propensity in government to make the mistake most football coaches try like the very devil to avoid.  You see, in football coaches will - given other factors being equal - always pick the best available brains.  In politics, this isn't especially so.

 

There are plenty of other good economics advisor candidates, too including Nouriel Roubini. He's another guy who "Gets it" and more importantly, had the balls to say so (with the housing bubble collapse pending) while yes-sir group-think get-along economics types were too stupid and/or hypnotized and/or afraid to see Reality staring us in the face.

 

Not that I'd agree with every recommendation that would come from a Stiglitz or a Krugman, but I'd go along with whatever plays they'd call in because they are best-of-the-best.

 

And that's what America needs -- before January.

 

When Larry Summers was appointed to chair the National Economic Council, Nov. 24, 2008, the Dow had fallen to 8,479.39 at the close.  I've make investment decisions that reflect my belief that we'll be back in that range again by the time Summers takes his leave.

 

Denninger Scores it Right

If you have time this morning, click over to the Karl Denninger piece this morning under the headline "The folly of Investing Today".  He makes the point that the 10-year treasury yield (TNX) has fallen on its ass and that has always preceded very bad news for stocks.  Not little bad but BIG BAD.

 

As I explained to Peoplenomics subscribers last weekend, we ought to see a collapse of volume this week (or maybe next) accompanied by a short term decline in price and then a surge in volume as the professionals unload their inventory hand-over-fist to the dumb public.  Write it down: This is the top as I see it. 

 

I could be wrong so no, This is not investment advice.  If you want to sit around in a crowded theatre smelling smoke, that's your business, I suppose. My money flow pause at the top theory (then picking up for the distribution phase)  and the Denninger observation about the TNX do seem to me to add a scent of gasoline to the downside.

 

Wall Street Vampire Killings

Got a couple of readers who are members of the Wall St. elite who gather after market hours as the "Friends of Fermentation".  I'd like to suggest that they may wish to adjourn early tonight in view of what's planned by the Aaron Burr Society, who's catchy graphic (left) is borrowed here to give a sense of what's on tonight.

 

According to the Aaron Burr Society website, the arrival of fall (yeah, I jumped the gun yesterday, still want to make something of it?) will include "a Vampire Slaying of Wall Street Bloodsuckers, traitors who wrap themselves in the flag...."

Symbolic Slaying 11:09 p.m., arrive at 10:30 p.m. in front of the New York Stock Exchange at Wall & Nassau Streets, NYC

So have Wall Street, Oil, Coal, and their Corporate Cronies really subverted the People of the United State of America?  Why of course!  Which is why there are Yankee Rebels of the Enlightenment. Which is why our jobs got exported and why the Fed rents us money...but that's a longer conversation...one about the PTB and the PTA (powers that ain't)...we're all PTA members...

 

Missing Banker Report
Mystery brewing in Michigan.

 

$1,300 Gold, $21 Silver

The price of gold didn't quite hit $1300 this morning, but over the next few days while the markets continue their manic ways that's possible.  Silver is sitting over $21 when I looked and gold was only about $5 from its new high ground.

 

A note from the National Inflation Association  under the headliner "Americans Enjoying Final Days of Artificial Economy" refers to the Japanese central bank intervention to help explain what's going on:

"Japan's efforts to postpone a few Japanese corporations going through a brief but tough readjustment period are helping to artificially prop up the standard of living for Americans one last time. NIA believes that the Japanese better be careful what they wish for. Never before in world history has nearly every developed country been in battle with each other to have the weakest currency. Asian producing countries want their currencies to be the weakest so that they can have the honor of shipping their products to Americans who can't afford them.

Currencies are very fragile, especially when they are fiat and backed by nothing. NIA believes that nearly all countries around the world with fiat currencies are currently making the grave mistake of doing everything in their power to debase them. Even a five-year-old child, if you asked them if they want the money in their piggy bank to be worth more or less, would have the common sense to say more. The world's politicians either don't have this same common sense or they are being paid off by the management of export giants."

I don't suppose I have to explain what happens when that ends?

---

Even though gold and silver are high, once the Dow starts getting kicked downstairs to the 8,600 level (and lower) I expect that Gold and Silver will decline.  But, while their nominal price will be coming down, what they will actually buy seems likely to be shooting up. 

 

Been watching the price of cars, sailboats,  and planes on eBay, Craigslist and such places.  That's where a salt of the earth people's economist looks to see what's really going on. Repeat after me: no recovery... And I think the NBER is DFW  (No, not the airport you ninny! But speaking of which...

 

Ships Ahoy

From a reader/friend/ham radio sort:

"I am reliably informed by The Union That Can't Find Work For Me that the US-flag shipping tonnage through the end of JULY 2010 was up by 40 % from JULY 2009.

Of course, since Lakes ships haven't carried Radio Officers since the middle '60's or so, it's a moot point to me. But, it MAY indicate increased economic activity.

Or not.

Just more bits of data in the maelstrom...

Reminds me to mention port data for the month:  Long Beach loaded inbound was up 24.5% YoY loaded outbound was down 3.5% YoY but not surprising since all our manufacturing has been exported, for crying out loud. 

 

Los Angeles inbound was up 23.34% YoY for August.  Portland was up 27.8% (a snarl here though because I had to push the numbers out myself...can someone teach them Excel, please?).  Port of Seattle was up a whopping 38.9%.

 

And yeah, radio officer jobs are getting tough to land...

 

Das Papieren, Bitte

New rules on air travel are going into effect Nov. 1.  Starting with flights that day, you'll have to supply date of birth and gender 72-hours before flight time. 

 

"What if they're gonna change before flight time?" 

 

You can't be serious?

 

Making Book

Seems the administration was deeply divided on Afghanistan policy says the new Bob Woodward book Obama's Wars.

 

Iran's Old News

The ABC headline that Iran's "President Ahmadinejad Threatens U.S. with War 'Without Boundaries'" tells me how disconnected Iran's leadership is.

 

I mean we already have 'war without boundaries' - haven't these guys heard of our border with Mexico or MS-13?

---

Speaking of which, the latest amnesty deal has failed in the senate along with repeal of 'don't ask, don't tell'..

 

Way to Go, Hil

SecState Hilary is giving away $50-million to third worlders to help fight global pollution and 'deaths from smoke inhalation'... WTF?  People in Michigan are out of unemployment and this is how we spend?  Hand me the ViceGrips - I just knew I wouldn't make it through this morning's report without 'em.

 

How about a Xerox machine, some foil and instructions on how to build a sun oven?  Way cheaper....now about those people out of benefits....ahem...

 

Born-Again Kapitalists

I like the report that Russian lawmakers are talking about 'branding the hands of corrupt officials'. 

 

Of course, it would never work in Washington.  The burn center's not big enough. (rim shot)

 

Coping:  Arguing Over Tea

Try though I do to remain un-swayed in my opinions by facts, occasional they do get through.  A recent example is about "The Tea Party".

 

Not that I'm changing my mind about anything, but in the interest of intellectual honesty, I can fairly report that emails are presently about equally divided between "George Ure a doof for buying the Tea Party" to "George Ure a genius for getting with the Tea Party".  Both are incorrect, although like discussions about religions and sex, everyone's a True Believer in one side, the other, or both.

 

The "George Ure a doof..." crowd is convinced that the Koch Brothers (who funded the Tea Party from the get-go and are busily bankrolling candidates) are somehow evil incarnate.  As one of my friends explained (amid what sounded like a rising spike in blood pressure) was behind many far-right organizations including making substantial contributions to the John Birch Society (www.jbs.org).  

 

In the interest of time, I didn't get into "So what did the John Birch Society get wrong?"  Socialism has come calling in America and our standard of living has been going nowhere for more than 40-years.  One head-of-household working doesn't cut it like it did for a flourishing American Middle Class in the 1960's. 

 

I could have gone on about how the JBS crowd does get most Constitutional issues right - and as an example over here, you can catch Ron Paul speaking recently about State Nullification of federal laws that over-reach the line in the sand which reserved power not so delegated to the States.

---

Panama Bates (my bro-in-law) noted recently:  "When the Johnson Great Society came around about 15% of Americans were severely poor.  After all the spending through entitlements and more, what's the number today?"  I look at the U-6 table from the Department of Labor's unemployment report and find it's upwards of 20%.

 

In fairness to the other side, yes, the argument can be made that corporate contributions by the Tea Party tend to be large, single donations and my friend who dislikes PoliTeacs has a very good point:  Single money sources might make some candidates more (not less) responsive to corporate influence.

 

My take is that future history will be (as always) a mix with some corpgov sellout candidates getting into office, but some genuine citizen-legislators, too.

---

For now, I'll  continue to watch the PoliTeacs closely but reminding mindful that at best the Tea Party is just another divide and conquer strategy of the Big Boyz in the closest who get the public whipped up along right/left political lines while failing to note that the real battle is (as always) between the UPs and the DOWNs.

 

There's a much larger battle than simple right-left going on - one that our children and grandchildren will suffer the consequences of, since right-left keeps sliding financial obligations onto the backs of future generations.  I'll save that discussion for Peoplenomics this weekend, but main thing to keep in mind is that right-left (hot emotional issues) are NOT the game here.  Something much more fundamental is going on.

 

UFO's and Nukes

I suppose by now you've seen the reports about how UFO's have been seen over many nuclear installations and that nukes may have been disabled by their (occupants?).  More will come at a press conference Monday at the National Press Club, but in the meantime, I keep getting notes about UFO plans to park over major cities of the world in late October/early November as a show of  strength yada, yada....not in our data, haven't seen anything on the wire about it, I expect IF there was to be that kind of event it would likely be the topic of a prime time presidential disclosure.

 

Not yet...

 

Healthwise: Aspirin Debate

Reader note:

George, In a recent column you mentioned that you take aspirin daily. It bothered me to read that, so I'm sending you a link to the subject report. Below the link is the section that speaks to aspirin. A sensible, low carbohydrate diet is more appropriate to maintaining good heart health.  Link here.

I've been taking a child's aspirin a day - no known side effects, but maybe IJ will knock off for a while and stick with lots of D3 and Co Q 10. 

 

Now that the weather is cool enough at the ranch to allow someone to go outside for more than 30-seconds at a whack, plenty of exercise is back in fashion.  The 120-days of summer hell are slowly ending and none too soon.

 

Breakfast of Champions

Word this morning that General Mills posted a strong Q1 may be nice for shareholders.  But my read of the economy is that the reason breakfaste cereal sales are up is people can't afford anything else...so goes life for the emergent underclass...

 

---

Tuesday September 21, 2010

Hold 'em & Growl

No surprise to this one (since they're stuck smack betwixt the legendary rock & hard spot, but the Fed today did nothing but more (yawn) 'tough talk' about the economy...like that'll help. Pardon my cynicism. Here's the unabashed statement of why they're again doing nothing

Release Date: September 21, 2010

For immediate release Information received since the Federal Open Market Committee met in August indicates that the pace of recovery in output and employment has slowed in recent months. Household spending is increasing gradually, but remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit. Business spending on equipment and software is rising, though less rapidly than earlier in the year, while investment in nonresidential structures continues to be weak. Employers remain reluctant to add to payrolls. Housing starts are at a depressed level. Bank lending has continued to contract, but at a reduced rate in recent months. The Committee anticipates a gradual return to higher levels of resource utilization in a context of price stability, although the pace of economic recovery is likely to be modest in the near term.

Measures of underlying inflation are currently at levels somewhat below those the Committee judges most consistent, over the longer run, with its mandate to promote maximum employment and price stability. With substantial resource slack continuing to restrain cost pressures and longer-term inflation expectations stable, inflation is likely to remain subdued for some time before rising to levels the Committee considers consistent with its mandate.

The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels for the federal funds rate for an extended period. The Committee also will maintain its existing policy of reinvesting principal payments from its securities holdings.

The Committee will continue to monitor the economic outlook and financial developments and is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; James Bullard; Elizabeth A. Duke; Sandra Pianalto; Eric S. Rosengren; Daniel K. Tarullo; and Kevin M. Warsh.

Voting against the policy was Thomas M. Hoenig, who judged that the economy continues to recover at a moderate pace. Accordingly, he believed that continuing to express the expectation of exceptionally low levels of the federal funds rate for an extended period was no longer warranted and will lead to future imbalances that undermine stable long-run growth. In addition, given economic and financial conditions, Mr. Hoenig did not believe that continuing to reinvest principal payments from its securities holdings was required to support the Committee’s policy objectives.

Going into the decision the NYSE was 3:7 weighted on downside volume, so in a sense, both shares traded today wouldn't have otherwise amounted to a hill of beans had the 'pile-on HF traders' not been there to exaggerate the market's action. Market's likely to use this to go on to a further empty-bubble high though...

 

Fed Decision Day

The expected Monday upward pop in the Dow brings us very close to either upside break-out territory, OR the top is really, finally in.  Robin Landry's latest note to colleagues in the investment community outlines the case:

Hi Everyone,

The market action today (Monday - g) makes the count as shown on the attached chart my preferred count. As shown on the chart, the C wave will equal the A wave at 11,0041, a common relationship. If the market rallies much beyond this point, the bearish count is wrong, and we likely have several more months of rally before P2 is over. I will cover that wave count should it become necessary. I continue to have bearish divergences on many of my indicators but I believe we must turn this week. I will watch and let the market tell me when the next decline begins. As always questions and comments are welcome.

- Robin  rlandry@allegiance.tv

 

My money is still "where my mouth is" - on the short side but upside down which is a tad uncomfortable.  But, when I see a big run-up in the market on very thin volume  (3.364-billion shares compared with last Monday's 4.521-billion) I expect the top is nearby as explained in last week's Peoplenomics.com report where there's a very good discussion and charts about inflation corrected OBV times price (money flow) which seems to have a signature hesitation around tops just before the distribution to 'weaker hands' gets underway. 

 

Not an easy time to be a bear, but be sure to drop by this afternoon when the Fed releases its FOMC statement.  A big run-up would be a fine place to leak bad news into the market. 

 

How About Housing?

BUILDING PERMITS Privately-owned housing units authorized by building permits in August were at a seasonally adjusted annual rate of 569,000. This is 1.8 percent (±2.0%)* above the revised July rate of 559,000, but is 6.7 percent (±1.4%) below the August 2009 estimate of 610,000. Single-family authorizations in August were at a rate of 401,000; this is 1.2 percent (±1.0%) below the revised July figure of 406,000. Authorizations of units in buildings with five units or more were at a rate of 150,000 in August.

 

HOUSING STARTS Privately-owned housing starts in August were at a seasonally adjusted annual rate of 598,000. This is 10.5 percent (±11.9%)* above U.S. Census Bureau News Joint Release U.S. Department of Housing and Urban Development U.S. Department of Commerce Washington, D.C. 20233 11.9%) the revised July estimate of 541,000 and is 2.2 percent (±9.7%)* above the August 2009 rate of 585,000. Single-family housing starts in August were at a rate of 438,000; this is 4.3 percent (±12.4%)* above the revised July figure of 420,000. The August rate for units in buildings with five units or more was 147,000.

 

HOUSING COMPLETIONS Privately-owned housing completions in August were at a seasonally adjusted annual rate of 603,000. This is 5.6 percent (±12.6%)* above the revised July estimate of 571,000, but is 23.7 percent (±9.6%) below the August 2009 rate of 790,000. Single-family housing completions in August were at a rate of 482,000; this is 1.3 percent (±12.0%)* above the revised July rate of 476,000. The August rate for units in buildings with five units or more was 115,000.

Say, does the work SUCKS come to mind here?

 

48-Days to a Tipping Point

I first started using the term "tipping point" when a then unknown fellow named Clif started corresponding with me  in May/June of 2001 prior to 9/11 about his "Screwy Theory #153" which was predicting (using the early forerunner of what was to become 'web bot technology' something big to happen about this far ahead of 9/11/2001.

 

Of course, we got that one wrong.  Oh, sure, 9/11 happened, and yes, it had aspects of 'military' and 'accident' and even the location indicators showed a 'cloud' of data around Las Vegas around the time the 9/11 perps were there partying.

 

But did we get the specifics of 'twin towers' and three or four airplanes right?  Nope.  Instead, piecing together what was presently available in advance of the tipping point, I expected something like the ABM tests to fail.  We lacked an appreciation of how thoroughly and all-pervasive a major tipping point in predictive linguistic modelspace would be.

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Today is the fall equinox.  In predictive linguistics (and among time monks) this is an auspicious time which should present - between now and November 1st - two notable events, one of which should be another "sun quake" if there's anything to the  expectation that out sun will from there have just eight more 87-day cycles until we get some serious solar activity which might include an infrastructure damaging earth-directed coronal mass ejection (CME).  There's circumstantial data that suggests that all those images of an "angry sun" are related to the 'twisting up" or "torsion/tensioning" of the sun, whose equatorial plasma rotates 87-days different from its poles.

 

References to 'sun disease' though, have been in the linguistics data since 1999 which means either it's a data processing artifact, or more worrisome, that it's a near-extinction level (or pure extinction-level) event based on our developing understand that the larger and event is (i.e. more impacting on more humans) the longer the lead time.

 

Still, the events of this October are likely not the Sun events, which seem to come much later.  Instead, whatever 'IT" is should start in the United States and then quickly propagate globally.  Since it doesn't arise in the Terra Entity, we're presently discounting earthquakes, sun quakes, CME's and that kind of thing.  Likely something much more human-centric.

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Which gets us around to plans to 'document' the expected tipping point November 8-12 which is 48-days out as of this morning.

 

Clif will likely issue a special report analyzing the 'high immediacy values' around mid-October.  The data streams have been quietly running and the data coming in with the period from three weeks out from mid-October to 3-months out of greatest interest because in the most dire of reads of previously collected data this tipping point to come appeared to be something several orders of magnitude greater than the events of the last major tipping point (9/11/2001) in terms of impact (both initial and the follow-on mourning/grieving process), but what that might be is anyone's guess.

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It's tempting - given even a rough guestimate of the future - to throw out ideas about what event(s) could be large enough to 'change the world'?

 

The list of suspects here is huge:  Collapse of the global financial 'system' under just too much pressure, massive changes in governance globally as corporations assert their dominance of government...why the list is indeed mind-boggling.

 

It's also what gets me out of bed every morning - looking for those oe or two key events that will get us looking in the right direction in advance of the changes to come, and just possibly with enough lead-time to make final adjustments to our plans to cope with what is - unfortunately for now - a generalized 'get ready for it...

 

House Bailing Out

The House may bail out come the end of the week to head home where there are plenty of angry voters  (including me) who are getting sick and tired of the hypocrisy and arrogance of those who pretend to 'lead' us.

 

One reason?  Ever look at the Wikipedia entry on  pay for these guys?

Salary and benefits [edit] Salaries As of January 2010, the annual salary of each Representative is $174,000.[13] The Speaker of the House and the Majority and Minority Leaders earn more: $223,500 for the Speaker and $193,400 for their party leaders (the same as Senate leaders). A cost-of-living-adjustment (COLA) increase takes effect annually unless Congress votes to not accept it. Congress sets members' salaries; however, the Twenty-seventh Amendment to the United States Constitution prohibits a change in salary (but not COLA[14]) from taking effect until after the next general election. Representatives are eligible for lifetime benefits after serving for five years, including a pension, health benefits, and social security benefits.[15]

And you were paying attention last November when congress decided that  'Yeah, they'd take the COLA for this year...'

 

While there are some who try to keep up appearances of a two-party system, my guess for the times ahead is that as the Tea Party evolves into a true conservative's organization (small, balanced federal budget, wars that make sense, etc.) the republicorps and the democorps will have to merge at some point, since Bush 2 and Obama are functionally identical in the eyes of many voters. 

 

As I've been writing for some time, this unholy alliance (corpgov) could be in for the fight of its life because the Tea Party is evolving into a people's party and that puts it out of the controller's control.  Oh well...so the has-beens are going to spend even more time in their districts now telling us how No COLAS for social security and military retirees is OK when they took the raise this year.

 

From the Social Security web site:

With consumer prices down over the past year, monthly Social Security and Supplemental Security Income benefits for more than 57 million Americans will not automatically increase in 2010. This will be the first year without an automatic Cost-of-Living Adjustment (COLA) since they went into effect in 1975.

Why does the phrase "Do as we say...not as we do..,." come to mind?

 

Britains Blatant Power-Grab

Before you discount the notion that a 'global revolution' in November is out of the question, consider, if you will, the report out of the UK that the government there has a proposal floating around to require all employers to send payrolls to the British version of IRS and THEY would figure out how much money a worker should get after the government takes its cut.

 

Yes, I know on the one-hand I may seem like a nut-job when I talk about the possibility of "corporate government asserting its near total control over free humans" but - on the other - here's more evidence that this is indeed the macro-trend and it's very much in play.  I don't know how much more the facts have to be 'in-your-face' before people wake up:  Freedom is being obsoleted by aggressive, advanced, cancerous statism.

 

What's that?  Wikipedia's answer from The Political Science Dictionary:

Sovereignty is vested not in the people but in the national state, and that all individuals and associations exist only to enhance the power, the prestige, and the well-being of the state. The concept of statism, which is seen as synonymous with the concept of nation, and corporatism repudiates individualism and exalts the nation as an organic body headed by the Supreme Leader and nurtured by unity, force, and discipline.

I'd argue that since corporate interests swamp the desires of We the People, we're already there and the larger 'game afoot' is to keep turning the herd just fast enough to bring on One World Government without starting a stampede.  Which is being done nicely, so far.

 

A Touch of Terror

Another herd-turner to be watched closely is the orchestration of terror, which at a macro-level looks almost, well, too convenient.

 

The UK's Telegraph reports today that Paris is on a higher alert level for al Qaeda's revenge since the government there last week voted to ban full-face veils.

 

Toss in word of a couple of sleeper cells being activated and the search for a lone bomber and you've got the makings of the TV series....a real herd-turner, especially if there's a sudden loud noise....

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The problem with Muslim full-face veils is that they represent a very interesting threat to the State Security apparatchik. With many cities putting in cameras all over the place - along with face-recognition software - to track movements of 'questionables', i.e. anyone government feels like watching, rights to privacy are quickly disappearing.

 

On the surface, the reasoning  behind scads of new cameras in places alike New York is 'anti-terrorism' but in a curious twist of fate, it's likely that the veil-wearing Muslims may end up with greater anonymity - and privacy - than the unveiled average American.

 

Go figure.

 

Smaller Government

I've mentioned many times previous howe the born-again kapitalists of Russia seem to be doing as well as the U.S. in keeping government under control.  Now comes word from the Kremlin that 100,000 bureaucrat's jobs will be cut in the next three years.

 

Russians historically drink more tea than Americans, who are more hooked on the bean.  Which gets us to this gem...

 

Coffee-Crazed!

A Kentucky man is using the interesting excuse of 'too much caffeine' was behind an errant confession to strangling his wife.

 

Wonder if the jury will have a Mrs. Olson on it?  Stranger things have happened...

 

Coping:  Recession Over?

The National Bureau of Economic Research issued, what was for me anyway, a startling thing on Monday.  One of the factors that powered the market to a grand advance was their pronouncement that the 'recession is over".  I fumbled around a bit to get my ViceGrips properly attached (the better to pinch myself with) as I tried to follow their logic:

"CAMBRIDGE September 20, 2010 - The Business Cycle Dating Committee of the National Bureau of Economic Research met yesterday by conference call. At its meeting, the committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion. The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months.

In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month. A recession is a period of falling economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. The trough marks the end of the declining phase and the start of the rising phase of the business cycle. Economic activity is typically below normal in the early stages of an expansion, and it sometimes remains so well into the expansion.

The committee decided that any future downturn of the economy would be a new recession and not a continuation of the recession that began in December 2007. The basis for this decision was the length and strength of the recovery to date. "

Wondering about the consistency of their thinking, I decided to look back on how they scored the Great Depression, which ran from the market peak of September 1929 to (arguably) the beginning of the US war against Japan in December of 1941.

 

They divided the Depression into two events.  One running from August to 1929 and ending in March of 1933 with the secondary Depression running from may 1937 to June 1938, which is when the US started ramping up for WW II.

 

Not sure how the NBER came to their conclusion, since a review of the US GPD figures shows that QIV 2007 still had a 2.9% GPS AGR and QIII 2009 had a paltry 1.6% GDP AGR.  (AGR=annualized growth rate, BTW).

 

Yes, Q4 2009 came up to around 5% which implied that something happened, but I'd argue that what was really going on was that the Fed was pumping the living bejeezus out of M1 - which was up 6.2% YoY from Dec 2008 to Dec. 2009. To my simple way of thinking if money is up 6% and GDP is up 5% then there's 1% deflation /economic shrinkage in play.

 

Further, a review of BLS Unemployment Data shows June 2009 with an unemployment rate of 9.5% and 140,196,000 people working.

 

July 2009 saw a 9.4% unemployment rate - but that was largely because the civilian labor force shrank by almost half a million (444,000) to make that happen.  Oh, and the number of people working continued to drop - down to 140,041,000.

 

So do I - the people's economist believe the recession ended in 2009?  Nope.  I respect the NBER's view, but my view continues to be that we're in a recession/depression and at least the few data points I've checked don't argue that the 'recession' has ended yet.

 

What many people missed is that the NBER claim of the recession-end in 2009 was that it's from year-ago figures.  The market, not thinking clearly (surprised?) rallied on Monday for reasons I can only assume are unrelated.

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Much feedback on the super-insulated homes to share with you, but running out of time for this morning so Dew Drop Inn tomorrow...

 

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Monday September 20, 2010

About Those Euro Bank Fears

"They did what???"

"Yeah, the ECB intervened in the Irish bond market on Friday...I'll send you the link," my consigliore called me to advise over the weekend.  The Financial Times is one of the few outfits worth signing up registration for along with a half-dozen, or so, other newspaper sites.

 

So, first thing on our agenda this week is watching to see how this boils over onto the global corporate cooktop.  And we shouldn't have long to wait as Ireland's Post headlines "Ireland facing a cruicial week on the bond markets" which starts tomorrow with a crucial €1-billion bond auction tomorrow.

 

Speaking in Dublin this morning, Irish central bank governor Patrick Honohan did the usual yammering about how Ireland has to cut its budget deficit, but the bond market - having heard all that before - and smelling blood in the water -  is already raising rates.

 

Oh, did I mention this puts something of a support under gold and silver prices which continue perched near records and may go higher, or have you had enough caffeine to have that one figured out on your own?

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Looking at the other PIIGS in this poke, we see how the EU is planning to extend air to Greece for who-knows-how-long.  I'd note in passing that countries like France seem really anxious to kick homeless Romanians out of their country because of the load they place on social services, BUT when it comes to bailing out whole damn countries, there's the EU for you:  Long on paradigm defending but really anti-human in many ways.  Open borders was the promise, but only for those with dough ---  ain't that always how it is?  Whatever.

 

Having gotten on the EU dole list, the Greeks are now putting off their "stress tests" of banks until October and that (as you know from our discussions of November 8-12 for how many months?) gets us uncomfortably close to the global tipping point that starts in the US and goes global from there.

 

I'm not too worried about Italy, one of the 'i's' in PIIGS, since their foreign trade was up 12.2% in July according to reports out this morning, but if their trade gets torpedoed, they will go back on the EU problem child list.

 

The 'P" in PIIGS is Portugal where once again, we see the 'G" (Germans) lecturing on how Portugal 'has to do more' which is a load of crap, since they're probably watching Greece and thinking "WTF?  If Greece can get free money and string along the EU, why can't we?"  At least, that'd be the reasonable question to be asking now, wouldn't it?  Ah, but those Germans, always trying to run Europe, huh?  Est sehr gut, jah?

 

Won't even go into how Spain is about to force private retirement systems into buying government debt...(takes a bit of reading here to find it).  Oh, the US ponders such things, too, you betcha.

 

Market looks like it's set for the "normal" Monday morning rally...

 

The Weak Ahead

We'll see housing numbers from the National Association of Home Builders today and 'offishul' (sic) numbers tomorrow.  But housing numbers aren't the reason to get up by noon, or so, tomorrow:  The Fed is due to release a rate decision and already the headlines are about that the bond market has the snooze alarm on waiting for that.

 

Not that they can really do anything; What matters most is the use of keywords which will inevitably  lead to a new flurry of speculation about what's ahead for the economy.  Off in the background, this puts the dollar on hold and about the only mover seems to be the Australian dollar.

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Moody's has left their debt rating of the UK intact, which if you're a royalist, means 'all's right with the world'.  Or, more likely I think:  Moody's is being polite for a bit longer.  Next crisis, please?

 

Second Dip

Good journalism is still cropping up here and there.  Most recently, the NY Times is asking in a Nelson Schwartz piece Sunday what we've been asking for months now:  Where's the profits going to come from?  "Wall Street's Profit Engines Slow Down" notes the paper.

 

Ships Ahoy

China and Japan are eye-to-eye after going boat-to-boat over fishing in disputed waters.  After Japan's intervention last week, I wonder if ther China/Japan dispute could boil over into foreign exchange markets?

 

Is It Just Politics? Dept.

Colin Powell- who endorsed president Obama in 2008 - says Americans are feeling overwhelmed by new laws that are rapidly expanding government.  Even worse for the administration is Powell's comment that he's unsure whether the US is winning in Afghanistan, especially since five U.S. soldiers have been accused of 'sport killings' in the war zone.

 

While I'm sure there are some who will paint this as "politics" I think there's a time when folks can listen to a retired and highly decorated general and take it as 'speaking his mind' more than driving a political agenda.

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On the other hand, the NY Times reported Sunday that the Obama administration was considering a frontal advertising attack on the Tea Party which continues to gain influence.

 

We continue to pick up bits and pieces of the Tea Party overtaking and swamping the old-line republicorps who've had their time at the trough.  Republicorp senator Jim DeMint on a CNN show this weekend said if the GOP didn't deliver this time (referring to abandoning things like balanced budgets and other cornerstones of conservatism) then "I think the Republican party is dead."

 

Latest approval figures for congress are now down to only 18%.

 

Frankly, I don't understand that:  How come so high?

 

Weathering Mondays

Igor's got the power out in Bermuda this morning.  Next worry - like you need more stuff to worry about - is a tropical depression west of Africa which sports an 80% chance of going cyclonic.

 

Panama Bates (brother-in-law) came back from church Sunday to report "They had 39-degrees up in Idaho..." according to local talk.  Armed with this hint I looked and sure enough, not only cold and already a couple of frosts, but a "September snow surprise in Montana" Friday according to Channel 3 in Great Falls.

 

Coping: A Zero Operating Expense House?

Elaine's been doing research again...a sort of interesting story which in a nutshell is that our home ( a double-wide modular before we all 'got after it' and rebuilt most of it) has a roof on it from 1989, so with 25-year roofing it's getting on toward time to replace it.

 

Of particular note in her researching was a place she found online which went into how to stucco (and super-insulate) a mobile home for about $5-grand in materials.  In fact, the whole Solar Haven site is full of enough projects to keep you busy for 3-4 years.

 

I'll have to do a little research on some of the issues involved (like formaldehyde, which I want nothing to do with) but in principle it's a very attractive idea, especially since our electricity costs are already on the run with the solar panels (round one) and the pending installation of more solar panels (round two) in the works.

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Way back when (mid 1970's) I had a neighbor by the name of Gordy up in the Kirkland, Washington area, who got a good deal on some T&G siding and put a second layer of siding on his house. 

 

I admit it, I was highly skeptical at first:  The home was a well-built one already with R40 or so in the ceilings and good quality 3½ in fiberglass in the walls for about R-19.  But, sure enough, when he got the additional 3/4-inch of siding on (done at a tasteful 45-degrees) not only was his home significantly more "solid feeling", but his electric and gas bills went down 10-15% or so.

 

Now that Elaine's found this site, and we already agree that stucco is a good siding material (no bug intrusion seams, very long-lasting when installed right, and so forth) I find myself wondering if there is any limit to how well insulated a home can be?

 

For that matter (as coffee-driven monkey mind takes off on its first flight of the day) How close to 100% self-sufficient could we get if we put some filtration on the well, hooked up the additional solar panels, super-insulated the house, and get around to putting the new greenhouse together along with some hydroponics that I've already got the parts for?

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Now that the goats are gone, our water bills will likely return to the $30-40 range - not bad for three adults (among which I generously count myself, but that's open to some debate).  Electric (even with grid-tie PV) runs about $200/month.  A large chunk of that I'm guilty of since the way life has worked out, everything I enjoy seems to consume a lot of power - computing, ham radio, and every tool in the shop - not to mention I seem to operate best at 68 degrees ambient, not the more reasonable 76º Elaine keeps the house at.

 

While the additional PV should bring down our power consumption to nearly zero, there's that little matter of comfort to contend with.  More insulation in the floors, a couple of more inches in the sidewalls, and another 2-3" on the roof along with a highly reflecting color (like white) conceivably put us in the annual net power exporting position.

 

Payback time on some of this stuff is pretty quick for most folks.  A couple of more inches of insulation around a home seems like it would have a payoff period of five years - or less - and where can you put paper money these days for that kind of return?  Oh sure, can't ever have too much gold, too much silver, too many heritage seeds in the collection, but what are the little projects that can reduce operating costs right now?

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Next project for me will likely be the installation of some seriously heavy insulation (8" pvc as a form) around the outside water outlets.  Since that surprise snow up in Montana and the likelihood that we'll soon have our first day with a high less than 90º reminded me of the pain of working on frozen/thawing/leaking outdoor water faucets last year, I may actual get around to a little pre-emptive  construction. 

 

It's funny:  The older I get...with the realization that I'm really not going to live forever...the more sense reducing operating costs seems to make.  Not sure why that is, but when I was young I was always more focused on the top line, not reducing the middle line.  Maybe it has something to do with realizing that there's another clock ticking besides my own:  Maybe I'm just proactively preparing for the failure of fiat money.

 

No time to ponder, though:  Got more projects on my plate than a short-order cook, but any suggestions and personal experiences with super-insulated homes would be worth sharing...

 

 

Send your comments to george@ure.net

 

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Reader Action Department:

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"Live on $10,000" A Year

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Pass It On

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