Sunday, February 28, 2010

Lil Bo Peep...

Greetings good citizen,

Some speculate that we are drifting closer and closer to, er, ‘civil war’ (which is what the deniers of ‘class war’ would have you believe.)

Again, it’s difficult to determine which is more disturbing, the ‘cluelessness’ of the Tea Party movement or the MSM, which persists in providing them with a stage?

ONE OF the rallying cries of the original ‘revolution’ was ‘taxation without representation’…why nobody notices that once we got representation, nothing changed, nor will anything ‘change’ should the ‘Tea Partier’s get their mis-guided way! (Which is the likely the best explanation for why the MSM provides this idiotic movement with so much ‘free play’.)

One need only look as far as the badly crippled ‘Golden State’ (California) for a modern example of what happens if you allow the, er, ignorant electorate to ‘control’ the tax structure.

Sidebar: I’m as ‘anti-tax’ as they come, taxes merely provide the ‘owners’ (of resources) with an income stream for what is free from nature! Claiming you ‘own’ something does not entitle you to payment for it! Nobody can produce a ‘Bill of Sale’ countersigned by Mother Nature or her partner/alias God…but that’s not how the court system established by the ‘owners’ themselves sees it.

There are no taxes under ‘A Simple Plan’…because there is no ‘ownership’ of resources, this cuts the greedy (who masquerade as our ‘betters’) out of the loop from the outset. The other half of the ‘tax’ rip-off is to pay for that which can’t be done ‘profitably’…this ‘lack of profitability’ issue is closely related to the ‘unjustified enrichment’ of those who would exploit that which is free from nature (for their personal benefit, of course!)

Part of the reason you are forced to pay for as many things as possible is to mask the fact that three quarters of them are rip-offs!

So, what is more pathetic here, the ‘touching’ personal back story or the level of ignorance on display for the reading public?

Let’s see what you think about tonight’s offering

Unlikely Activist Who Got to the Tea Party Early

Published: February 27, 2010

SEATTLE — Keli Carender has a pierced nose, performs improv on weekends and lives here in a neighborhood with more Mexican grocers than coffeehouses. You might mistake her for the kind of young person whose vote powered President Obama to the White House. You probably would not think of her as a Tea Party type but leaders of the Tea Party movement credit her with being the first.

A year ago, frustrated that every time she called her senators to urge them to vote against the $787 billion stimulus bill their mailboxes were full, and tired of wearing out the ear of her Obama-voting fiancé, Ms. Carender decided to hold a protest against what she called the “porkulus.” [Geez Louise, you don’t suppose everybody who was ever ‘frustrated’ with politicians who ignored their constituents should become ‘Tea Partier’s’, should they?]

“I basically thought to myself: ‘I have two courses. I can give up, go home, crawl into bed and be really depressed and let it happen,’ ” she said this month while driving home from a protest at the State Capitol in Olympia. “Or I can do something different, and I can find a new avenue to have my voice get out.” [Left to our imaginations here good citizen is what, precisely, it is that is different about the Tea Party movement? What are they doing that the anti-war protesters aren’t, or perhaps the marchers for ‘civil rights’? What the hell is ‘different’ about the ‘Tea Party’ movement?]

This weekend, as Tea Party members observe the anniversary of the first mass protests nationwide, Ms. Carender’s path to activism offers a lens into how the movement has grown, taking many people who were not politically active — it is not uncommon to meet Tea Party advocates who say they have never voted — and turning them into a force that is rattling both parties as they look toward the midterm elections in the fall. [I think a more accurate descriptor here would be ‘Right-wing circus act’, with the Tea Partier’s cast in the role of the clowns! What are they ‘protesting’? They are ‘protesting’ against efforts to pull our economy out of a nose-dive we entered because of political ideas, THEY ENDORSED!]

Ms. Carender’s first rally drew only 120 people. A week later, she had 300, and six weeks later, 1,200 people gathered for a Tax Day Tea Party. Last month, she was among about 60 Tea Party leaders flown to Washington to be trained in election activism by FreedomWorks, the conservative advocacy organization led by Dick Armey , the former House Republican leader. [(Ezra Klein once described Dick Armey thus: “He’s like a stupid person’s idea of what a thoughtful person sounds like.”)]

This month, a year to the day of her first protest, Ms. Carender stood among a crowd of about 600 on the steps of the State Capitol, acknowledging the thanks from a speaker who cited her as the original Tea Party advocate. Around her were the now-familiar signs: “Can you hear us now?” “Is it 2012 yet?” “Tea Party: the party of now.” [More telling is the fact that NONE of the slogans tells you anything! ‘The Party of Now…What ‘now’? Can we hear them? Maybe we could if they were saying something other than ‘no’…]

Jenny Beth Martin, a national coordinator for Tea Party Patriots, an umbrella organization of local groups that Ms. Carender has joined, calls her an unlikely avatar of the movement but an ideal one. She puts a fresh, idealistic face on a movement often dismissed as a bunch of angry extremists.

“She’s not your typical conservative,” she said. “She’s an actress. She’s got a nose ring. I think it’s the thing that’s so amazing about our movement.” [What a novel idea, the Party of No has a movement about Nothing! (or are they REALLY blown away by ‘nose rings?’)]

The daughter of Democrats who became disaffected in the Clinton years, Ms. Carender, 30, began paying attention to politics during the 2008 campaign, but none of the candidates appealed to her. She had studied math at Western Washington University before earning a teaching certificate at Oxford — she teaches basic math to adult learners — and began reading more on economics, particularly the writings of Thomas Sowell, the libertarian economist, and National Review. [Gee, who is surprised about this revelation? There used to be a saying about communists that we could substitute the word ‘Libertarian’ for, it would go like this, “If you’re not a Libertarian at 20, you have no heart…but, if you’re still a Libertarian at 40, you have no brain!]

Reading about the stimulus, she said, “it didn’t make any sense to me to be spending all this money when we don’t have it.” [So the alternative would be ‘what’ precisely? This is perhaps the most baffling aspect of this whole ‘movement’, they aren’t ‘for’ anything…all they have are nebulous ideas like the one stated below:]

“It seems more logical to me that we create an atmosphere where private industry can start to grow again and create jobs,” she said. [Gee, what a great idea! Maybe we should hand her Timmy’s or Ben’s magic wands so she can make it happen! (Not that she’d do any worse than either Timmy or Ben…)]

Her fiancé, Conor McNassar, urged her to channel her complaints into a blog, which she called Liberty Belle. [Ain’t that cute! You can almost see Disney paying her a few million for the movie rights!]

“He didn’t mind hearing it,” she said. “He just couldn’t hear it all the time.”

It was not enough. [Um, aren’t we dancing dangerously close to a ‘character flaw’ here…shouldn’t somebody be telling Conor to ‘run for his life’?]

So she called the city parks department, which suggested a location and gave her a permit. She still did not know if any other protesters would show up.

She put out the word to some friends from the Young Republicans,which she had joined in late 2008, but it was not a big group. She called Michael Medved, the Seattle-based conservative radio host, but he did not put her on the air. She scanned a list of economics professors who had signed a Cato Institute letter opposing the stimulus and found two locally, but they could not make it.

She also called someone she had met at an election results watch party, who agreed to spread the word among Republicans. She called a conservative local radio host, who put in a plug. And she sent an e-mail message to the conservative writer Michelle Malkin, who agreed to announce the protest on her blog and even sent some pulled pork to feed the crowd. [Understand that the Republicans pissed through more than 5 trillion dollars during the Bush Presidency alone…(doubling the national debt) a feat matched only by St. Ronnie himself! So, ain’t they got big balls calling their ‘protest’ Porkulus? But that’s the hallmark of conservatism, isn’t it? Huge balls but no brains!]

The porkulus protest did not draw enough people to finish the pulled pork, which Ms. Carender took to a homeless shelter. [Which, naturally, makes it all good!] But she collected e-mail addresses, remembering that Senator Barack Obama had done that at events as he prepared to run for president. [Gee, did she have to get a tetanus shot after she stole ideas from a ‘liberal’?]

The “tea party” label came three days later, from a rant the CNBC correspondent Rick Santelli delivered from the floor of the Chicago Mercantile Exchange, and the nationwide protests followed. [Whatever happened to Santilli? Haven’t seen him around lately…]

Six weeks later, Ms. Carender’s e-mail list had grown to 1,000 — it is now 1,500 — allowing her to summon protesters on short notice and making her the model child of the Tea Party Patriots, which has since become a driving force for advocates nationwide with its weekly conference calls to coordinate Tea Party activity. [Um, did I miss something here or do these people actually stand for something other than being stupid?]

In her activism, Ms. Carender has also drawn on her theatrical experience. Discovering that advocates of a health care overhaul were marching in the city last summer, she staged a “funeral for health care,” with protesters wearing black and bagpipers playing. For her first Tea Party event, she dressed as Liberty Belle (newspaper accounts mistook her for Little Bo Peep). [Um, I’d have paid to see that! Kind of ironic though, what were people supposed to think with all of those Republican ‘sheep’ hanging around!]

In a video viewed 68,000 times on YouTube, she confronted Representative Norm Dicks, Democrat of Washington, at a town-hall-style meeting on health care. “If you believe that it is absolutely moral to take my money and give it to someone else based on their supposed needs,” she said, waving a $20 bill to boos and cheers, “then you come and take this $20 and use it as a down payment on this health care plan.” [Um, this is just too rich! And the Republican proposal is what precisely? Do NOTHING! What does boo-boo think $20 is going to accomplish?]

Ms. Carender is less certain when it comes to explaining, for instance, how to cut the deficit without cutting Medicaid and Medicare.

“Well,” she said, thinking for a long time and then sighing. “Let’s see. Some days I’m very Randian. I feel like there shouldn’t be any of those programs, that it should all be charitable organizations. Sometimes I think, well, maybe it really should be just state, and there should be no federal part in it at all. I bounce around in my solutions to the problem.” [Um, why do you suppose she ‘vacillates’ between making healthcare a ‘charitable’ institution or a State supported entity? Is this due her mind acknowledging that someday she’ll need this service herself while acknowledging that if health care were supported by charitable contributions, it may be reduced to somebody coming in and ‘praying’ for your improved health…]

She, like many Tea Party members, resists the idea of a Tea Party leader — “there are a thousand leaders,” she says. [Um, could this be an admission that they are collectively too stupid to lead?]

Glenn Beck? “He can be a Tea Partier, but it’s not like the movement bends to him.”

Sarah Palin? She will have to campaign on Tea Party ideas if she wants Tea Party support, Ms. Carender said, adding, “And if she were elected, she’d have to govern on those principles or be fired.” [Obviously she’s not clear on how this whole election boondoggle works! Once Sarah Baby gets elected, she no longer has to listen to the voters…all she has to do is kowtow to the corporate sponsors.]

Ms. Carender herself has become a Tea Party leader, even a celebrity.

At the Olympia rally, she did a television interview and accepted a hug from Kirby Wilbur, the radio host who first publicized her porkulus protest. “This is the future of the conservative movement!” he declared upon seeing her.

Her biggest goal now, Ms. Carender said, is replacing Senator Patty Murray, a Democrat elected three times by wide margins, in November. [From what we’ve seen here, her chances are as good as Sarah Palin’s White House ambitions…]

So Ms. Carender held a small anniversary rally on Saturday at a local mall. But her focus is on vetting candidates and using the contacts she has established over the last year to get out the vote. [Yuppers! All 1,500 of ‘em!]

“There is no way we will out-fund-raise the liberals,” she said. “The only weapon we have is energy and time.”

Um, can’t help but admire her modesty, she discounted her other ‘big asset’, her ‘Bo Peep’ ness.

Every State is just languishing to be represented by Lil’ Bo Peep in the US Senate!

Sadly, there aren’t a lot of stalwart girls like Bo Peep around. That said, isn’t it nice of the New York Times to run a story about this particular ‘founder’ of the Tea Party movement, not that she knew that was what she was doing at the time…

Which makes this a story about what, good citizen? A ‘good girl’ turned Republican, or was that just the inevitable outcome of being lobotomized?

What are the Tea Partier’s fighting for?

We didn’t know before we read this article and it’s not likely we’ll find out afterwards either…which makes this article a piece of fluff, just like the ‘movement’ it exemplifies.

Thanks for letting me (and not them) inside your head,


Saturday, February 27, 2010

Economic imbalances

Greetings good citizen,

Sorry about last night’s post but these dip-dang ‘puter thingies don’t work for a damn without juice

In eastern Massachusetts, where the storm brought rain and high winds — but only a trace of snow — about 68,000 customers were without power Friday afternoon. There were also outages in parts of Pennsylvania, New Jersey and Vermont.

Talk about ‘can’t get your facts straight’ (probably because NYC is 200 miles SW of Boston) local sources put the number of affected customers north of 100,000 with some areas not expected to have service restored before Sunday.

Thankfully, service was restored here right about sundown.

Could I have posted last night? Probably, but I had to thaw out first!

Enough bitchin’ and cryin’ about local events, thanks to ‘Global Warming’, 49 states out of fifty are currently under a layer of…snow.

Looks like we’re all going to freeze to death before we fry! Which is a puzzler considering all of this arm waving and frantic screaming about ‘greenhouse gases’…Where is this so-called ‘greenhouse’ and how do we get there…cuz it’s freaking cold and getting colder!

But that ‘is what it is’, which is to say I won’t matter much if we fail to put civilization on a sustainable track. More than just the weather will suck if we don’t stop the ‘status quo’.

Thus do we arrive at tonight’s first offering (a piece selected for it’s central premise rather than it’s, er, ‘ideological slant’.)

Finger on the Scale
By Patrick J. Deneen 23 February 2010

It’s often asked by more practical-minded readers “so what’s the point”? What is to be done? After all the theory, what practical recommendations can FPR offer by way of encouraging “limits, place, liberty”? [As hinted at above, the ‘ideological slant’ here appears to be Libertarian.]

An article in this past Sunday’s “Outlook” section of the Washington Post offered a glimpse into one issue that would go a long way toward the restoration of localities and certain attendant virtues in American life today. Barry Lynn of the New America Foundation (a left-center technophiliac think tank) and author of Cornered: The New Monopoly Capitalism and the Economics of Destruction, authored a lead article in Sunday’s Washington Post noting the precipitous decline in small-scale business ownership in America over the past thirty years. In a lament that could easily be found elsewhere on FPR, he wrote,

Where the independent pharmacist counted pills, we see a CVS employee. Where family livestock farms dotted the landscape, we see immense operations run by Smithfield and Tyson. Where the buttonmakers of New York and Los Angeles sold their wares, we see the imported products of Li & Fung. Where our community bank stood, we see Bank of America. Where the local grocer marketed local fruit, we see Wal-Mart. Where the local general-merchandise store stacked jeans, we see, well, Wal-Mart again.

Lynn notes several pieces of data that focus the mind: America is second-to-last among the world’s 77 richest nations (only leading Luxembourg) in small-business ownership, and over the past 50 years, self-employment in non-farm businesses has fallen by 50 percent.

Writes Lynn,

Ask an economist why so many small businesses have given way to giant chains, and you’ll hear a lecture on the dynamics of capitalism and free markets, and how the creative destruction of small, independent businesses is a natural and benign process. Yet specific political moves and decisions in Washington over the past several decades have made it much easier for the people who control large-scale corporations to displace small proprietors. [As you can see, we are hearing the argument for ‘capitalist utopia’ being made once again…and as I have pointed out repeatedly, capitalist utopia can’t exist for one reason…market share, there isn’t enough of it to supply us all with ‘perpetual positive cash flow’.]

Lynn goes on to discuss some specific political policies that will doubtless make some on the Right cringe, including lax enforcement of Anti-trust measures. He also offers a dubious evaluation of the role of “populists” in the FDR and Truman administration in their embrace of centralization of economic power (I’d need to hear more about his definition of the word “populist”.) I’d counter that, according to Amity Schlaes in her fine book The Forgotten Man, it was New Deal policy that systematically favored big business over small scale ownership. FDR and his brain trust realized that it was much easier to regulate big private entities, and big private entities came to realize that burdensome regulation actually gave them competitive advantage. Since large-scale operations could use efficiencies of scale and simple bigness to comply with red tape, while enjoying healthy access in the process of the writing of regulation. [Um, ‘admiring’ Amity Schales is a half a step from adoring Ayn Rand. But we already know ‘Libertarian’s’ want liberty for them and only them…just as Ayn Rand ‘worshiped’ the mythical ‘rugged individual’. A world without grunts is a world where you do EVERYTHING for yourself. Not just a little of everything…ALL of everything! Which begs the question…just how thin can you spread yourself? Add to that ‘How many things are you an expert in?’]

But, one aspect of Lynn’s analysis rings particularly true: in the 1980s, “instead of protecting competitive markets, Reagan officials said they would use anti-monopoly laws to promote ‘consumer welfare,’ which they defined largely as lower prices. It no longer mattered how much power was consolidated, as long as the consolidation appeared to result in the delivery of less-expensive goods.” [Geez, everybody picks on Saint Ronnie! I wonder why?]

We have seen the aftermath of these policies: the destruction of small businesses throughout America, and a corresponding economic crisis in which disconnection, irresponsibility, and the decline of accountability fostered bad behavior throughout the American economic system. As William O. Douglas wrote (cited by Lynn), “When independents are swallowed up by the trusts and entrepreneurs become employees of absentee owners,” [the result] “is a serious loss in citizenship. Local leadership is diluted. He who was a leader in the village becomes dependent on outsiders for his action and policy.” [Let’s not ‘lionize’ the swindlers when the problem rests with income streams and the ‘pauperization of producers’.]

For FPR sympathizers with a policy interest, this is one area needing sustained attention and examination and specific policy recommendations. It is an issue over which both Left (e.g., Lynn) and at least some on the Right can agree, even if specific policy recommendations are likely to be debated. However, perhaps it would not be too difficult to begin looking at systematic ways in which current policy supports concentrated economic power, and to begin its dismantling. It may also be that Government needs to be more active in enforcing anti-trust measures. The Republican orthodoxy will scream that such activity is an intrusion of “Gummint,” but it’s clear that Gummint has already intruded in this area, and is doing tremendous damage to the fabric of the nation (the Republican orthodoxy’s ecstasy in the wake of the recent Supreme Court decision that ensures unlimited corporate participation in our electoral process does not inspire confidence about their motives.) Perhaps some log-rolling is in order: in exchange for a serious consideration about the disproportionate impact of regulation on differently scaled businesses, a sustained look at anti-trust enforcement could be considered. Or, more creatively still, legislators should read Allan Carlson’s Third Ways, and specifically his chapter on Chesterbelloc, for some innovative ideas on how to protect individually-owned businesses from the depredations of concentrated private power. We will differ even here on how much of a role the Gummint should have in tipping the scales, but it’s quite clear that the scales have already been considerably tipped, and that American towns, citizenship, and virtue have all suffered as a result – and that finally cheap prices are too high a price to pay.

Um, start agitating for unions and watch these people have a nutty!

Worse, the reason ‘big box stores’ kick the ass of the small retailer is price…Um, calling it ‘Anti-Trust’ would cheat the consumer out of the advantage of lower prices due to aggregate demand.

Pop’s corner store has to operate on a considerable mark-up so that he can earn a living off of the few things you buy from him over time. Worse, if more than one store opens up in the same community dealing in the same (general) product…one of them is eventually going to go out of business…because of ‘insufficient market share.’

The ‘solution’ is not to expand the size of the ‘privileged few’, the solution lies in ensuring everybody has a way to support themselves, which also allows them to interact with their community.

There’s more to a job than just a paycheck.

So we arrive at tonight’s second offering

Pictures of a Market Crash: Beware the Ides of March, And What Follows After

[purloined from: Jesse’s Crossroads Café]

There are a fair number of private and public forecasters that I know who anticipate a significant market decline in March.

Let's review where we are today.

The Bear Market of 2007-2009, marked by the Crash of 2008, was a massive decline in equity prices precipitated by the bursting of the credit bubble centered around housing prices and packaged debt obligations of highly questionable valuations.

Even today, I think most people do not appreciate the sheer magnitude of the decline, and the damage it has done to the real economy. This is the result, I believe, of three factors:

1. An extraordinary expansion of the Monetary Base by the Federal Reserve not seen since the aftermath of the Crash of 1929, and a swath of financial sector support programs from the Fed and the Treasury, resulting in a spectacular fifty percent retracement from the bottom. [What’s so spectacular about it, you might ask? Trillions were spent and we’ve got next to nothing to show for it!]

2. A comprehensive program of perception shaping by the government in conjunction with the financial sector to raise consumer confidence and prevent a further panic.

3. An understandable preoccupation with the details of breaking news, and a short term focus on particular events and even exogenous controversies, without a true appreciation of the 'big picture,' in part because of some very effective public relations campaigns.

This is resulting in a remarkable case of cognitive dissonance in which the victims of a spectacular man made calamity are opposing remedies and aid as too costly, as they walk around bleeding in the carnage.

For those who read the contemporary literature in the early Thirties, this is nothing new. In the early Thirties there was no sense of the magnitude of what had happened, except for a few notable exceptions, and the sense of 'life goes on' seems almost eerie to a modern reader. Indeed, Herbert Hoover could dismiss a delegation of concerned citizens with the advice that they were too late, the crisis was past.

The parallels with the Thirties and the Teens (today) are many, and uncanny.

There is the reformer President, elected to redress the policies of his Republican predecessor. In the Thirties they had FDR who was a decisive and experience leader. In the Teens the US has a community organizer much more in the sway of the Wall Street monied interests, who is trying to work through indirection and persuasion. [Ironic that this is a fair description of both Barrack Obama AND Woodrow Wilson…]

There is a Republican minority in the Congress which opposes all new programs and actions in both cases. In the Thirties they were over-ridden by a powerful President, who created a "New Deal" set of legislation, much of which was later overturned by a Supreme Court which had been largely selected by the previous Republican Administrations.

Indeed, the remaining New Deal programs that were successful, the reforms of Glass-Stegall and the safety net of Social Security, are being overturned and are under attack in an almost bucket list fashion.

So what next?

Another leg down in the economy and the financial markets is a high probability. [Followed shortly thereafter by some serious bloodshed.]

Although one cannot see it just yet in the fog of corrupted government statistics, the economy is not improving and the US Consumer is flat on their back.

There are still far too many otherwise responsible people who are not taking the situation with the high seriousness it deserves. They would like to see the US economy collapse, inflicting serious pain and deprivation because it may:

1.suit their investment positions and feed their egos,
2. satisfy their philosophical and emotional needs to see punishment administered, almost always to others, for the excesses of the credit bubble, even if they are unwitting victims, and/or
3. the sheer nastiness and immaturity of a portion of the population.

They know not what they do, until they do it, and see the results. It is often a good bet to assume that people will be irrational, almost to the point of idiocy and self-destruction. And some of them never wake up until they are overrun, and then will not admit their error out of a stubborn sense of pride and embarrassment.

There most likely will be a new leg down in the financial assets, as reality overcomes often not-so-subtle propaganda. It may start in March, or we may just see a 'market break' that provides a subtle warning for a large decline to begin in October 2010, with a multi year progression to lows that are as of now almost unimaginable, at least in real terms. [The Dow should be under 1,000…we don’t make anything anymore!]

The Fed is acting in a way so as to mask quite a bit of this. One would hope that they would not re-enact the policy error of their predecessors and raise rates prematurely out of fear of inflation. [Chances are they will have no choice but to raise rates, stiffly.]

But the error might be emulated by a failure to stimulate the economy effectively and reform the highly inefficient and impractical financial system. The global trade system is a farcical construct that favors a few national elites and multinational corporations. Public policy discussion has been trumped by a handful of economic myths and legends that, even though disproved every day, nevertheless remain resilient in public discussions and reactions.

A more serious market crash might cause people to recognize the severity of their problems, and the thinness of the arguments of the monied interests for the status quo which is most clearly unsustainable.

The outcome is difficult to predict precisely because there are multiple paths that events might take at several key decision points, and some of them might be rather disruptive and upsetting to civil tranquility.

But as the dust continues to settle, the probabilities will continue to clarify.

Well executed by the inestimable Jesse!

Thanks for letting me inside your head,


Thursday, February 25, 2010

What the heck are they smokin'?

Greetings good citizen,

Yesterday the markets picked up what they dropped the prior day…and today they dropped it again!

Which is the ‘same old, same old’…who cares, right?

Naturally, ‘market performance’ isn’t ‘where the news is’…

Tonight’s offering (brief as it may be) points directly to a phenomenon that has puzzled ‘rational people’ since before the crisis began. How can the markets continue to rise when the news is so negative?

Do they know something the rest of us don’t?

Or do they really think we are that STUPID?

Let’s have a look see: [Purloined from: The Automatic Earth]

February 24 2010: Bumping along the bottom of the credit cycle

Ilargi: "Without growth, we cannot begin the process of restoring fiscal responsibility," said Treasury Secretary Tim Geithner today to the House Budget Committee. And ".... before the federal government can begin attacking soaring deficits and a massive national debt, it needs to increase jobs and ensure economic growth." [Here’s the part they cut out: “With that goal firmly in mind, I wave my magic wand and recite the magic word…SHAZAM!]

That’s just about all you need to know, isn't it? It's the my way or the highway idea, put everything on red and pray for a miracle.[or magic, your choice!] There is no way Geithner can be sure that more spending of public funds will actually produce growth, but it's all he can think of (or at least all he talks about). And it’s also of course mighty easy to focus on spending if and when it’s not your own money you’re throwing at the proverbial black hole in the wall. [Is it a coincidence that the ‘black hole’ referred to here is physically located in the off-shore tax havens that happen to share space with The Bermuda Triangle?]

But illusions persist and the markets are up [This was posted yesterday, when the markets were indeed ‘up’] in the face of today’s what comes close to being the worst series of data on the economy emerging in the press to date. And I’m thinking: what on earth are you guys smoking? [So, how IS that ‘recovery thing’ working out for you?]

Sheila Bair’s report on the banks is abysmal. Lending in the private sector is falling off a cliff while public lending is running off that same cliff. In that quote above Geithner just told us that there are no plans to quit adding to the debt before spending gives birth to growth in some fictional fairy tale of immaculate financial conception. But it’s beyond foolish not to ask what happens if no such fairy tale ending exists, if only simply because the risk that pervades the entire endeavor is as palpable as it is terrifying.

The taxpayer funds presently spent on the thus far evasive dream of recovery and growth resumption could be spent on programs to soften the blow of possibility number two, where growth never resumes, or doesn’t do so for many years to come. It’s one thing for everyone to want growth, it's quite another to actually get what you wish for. [Worse, the wildcard here is ‘time’, today’s ‘wizards’ don’t have ‘forever’ to accomplish their task of restoring the global economy to growth. How ironic is it that the only viable solution lies in socialism?]

And if you watch the procedures from a distance, how can you not ask yourself what is wrong with a system in which a bunch of so-called experts acquire the right for a given society to spend many times more per person than what each person earns annually on a notion for which there is no pre-existing evidence that it could even possibly succeed? [Um, the people who got to decide are ‘we-todd-did’?]

It’s as if every single day you hand over the contents of your wallet plus the deed to your home plus the rights to your pension plans, to that smart nephew twice removed who says he's got a sure-fire way to game the house, the table and the dice. Pardon me, but I don't see that as very clever nor as a way toward longer term prosperity, and neither do I see it as a way to organize and legislate a society if you want it to have any chance of survival. It seems to me to be more of an expression of a massive society-wide neuron deficiency than anything else. Or is that a gambling addiction, or is that the same to begin with?

Still, I dare you to elect the politician who says he'll raise your taxes and start you off on a program of austerity rather than vote for his opponent who promises growth and prosperity if only you let him spend your future tax revenues now. Tim Geithner is a doofus, and Ben Bernanke is a douchebag, but they wouldn’t be where they are if you wouldn't let them.

And none of that means that they can deliver anything they promise; it just and only means that you like one prospect better than the other. Well, dream on if you must, but I solemnly promise that you have a whole bunch of nasty surprises coming. And when these surprises arrive, Geithner, Bernanke and Obama will have either entirely vanished from view, or perhaps even step up their public persona a notch to loudly and proudly proclaim that things happened that no-one could have foreseen. And at least if you read this, you know that will be a blatant lie.

Um, in case you haven’t heard, Mr. Greenspan declared today that the current financial crisis is indeed ‘the worst in history’.

Why this took him two years to figure out is unknown…just understand that this guy was ‘knighted’ not too long ago for ‘saving the world’.

Too bad it didn’t stay ‘saved’!

Oh, ‘would that it were’ ‘The great moderation’ was more than an accounting trick! Guess that’s what you have to watch out for; tricks that only work until they don’t!

Which brings us to the single most disturbing aspect of this whole disaster…it never should have happened.

The ‘Doe eyed’ innocents among you can brush this off as ‘shameless profiteering’ but that doesn’t explain the ultimate collapse of our civilization (worldwide, that nobody is acting to prevent) does it?

Sorry if that is a bit ‘mis-leading’…I’m not inferring an ‘extinction level event’ here, it will only wipe out 99% of us if things go ‘as planned’.

How else do you ‘stretch out’ a planet’s resources if not by radically (in this instance) reducing the number of end users?

That ‘class war’ we’ve been ignoring for the past forty years…it’s almost over…guess who won?

Oh, don’t worry! Some of you ‘working class’ paycheck paupers will survive…the ‘good people’ still aren’t planning on doing their own ‘heavy lifting’, they’ve magnanimously decided to ‘spare’ some deserving ‘brown people’. (This is decidedly bad news if you are not personally ‘brown’ and intent on living…)

Um, I only mention this because the time to decide that you should fight isn’t when you are too weak from lack of food to run more than a hundred feet.

Thanks for letting (my demented mind) inside your head!


Wednesday, February 24, 2010

The Way Forward

Greetings good citizen,

There is one ‘issue’ I’ve seen repeated on the web pages of many financial sites (admittedly, these are sites who share my, er, negative outlook on the prospects of capitalism’s survival.)

Which brings us to the lament I’ve seen repeated on a dozen web pages; what do we replace our currently badly broken system with?

I suspect most of you would favor simply hitting the ‘reset button’ on the current system and maybe turning back the ‘legal clock’ to before Glass-Stegal was repealed. The wiser among you would turn the clock back even further, to 1972 when Richard Nixon took the nation off of the gold standard.

Which begs the question as to whether or not our remaining saddled with ‘the standard’ would have saved our economy when the rest of the world had already left it in the dust?

There’s no ‘way back’ machine so we’ll never know for sure.

Sadly, this isn’t where this idea ‘hits the wall’. What will we do to prevent, for the sake of argument, our grandchildren from repeating this fiasco? You can bet your boots the Depression era legislators thought they’d fixed the problem for ‘all time’.

Worse, knowing what would happen, our current legislators STILL repealed the protections put in place after the first global depression. How the hell do you ‘fix’ that?

Which is to point out that it is no just the financial sector that needs an overhaul, it looks like the legal sector needs to be ‘refurbished’ from top to bottom.

First thing to hit the skids…legal professionals. The law is for everybody. It is pretty damn stupid to let a few people pretend to be ‘experts’. This practice has been responsible for repeated disasters.

Understand something here, these ‘experts’ have made a damn good living not from enforcing the law but from weaseling around laws they often had a hand in crafting! This is ‘insider trading’ on steroids. This is how we got ‘swaps’ which acted like insurance but wasn’t (so they weren’t ‘regulated’) causing the global financial sector to collapse!

Yeah Bubba, any ‘overhaul’ of society starts with an overhaul of the ‘legal system’. That overhaul starts with a prohibition against making your living from ‘interpreting’ the law.

Taking that a step further, the next ‘casualty’ of the overhaul process would be ‘judges’. Want to ‘short circuit’ the legal process? All you need to do is bullshit a judge! (Which leads us to another unseemly outcome…just how ‘handy’ is it to have a ‘judge’ on your payroll?)

I’ve examined the ‘judge’ issue from many angles and I have yet to find a single instance where they are vital to the ‘justice’ process. Truth be told, the judge’s main function is to insure rulings are ‘palatable’ to powerful interests. If a jury arrives at the ‘wrong’ verdict, it is the judge’s job to mitigate the decision. (Up to an including throwing the decision out and ordering a new trial.)

Nope, putting somebody in the position of being able to, er, ‘trump’ a jury doesn’t do anyone any favors…except the judge.

Perhaps the most telling indictment is that one need not be a lawyer to be appointed to the bench. Never mind judges who are elected, how the hell does the election process insure a qualified individual is, er, ‘awarded’ a judgeship?

Better to do away with the position altogether. Just to be safe, we’d also be wise to erect a barrier to creating ‘judge like’ positions. If you’re going to run roughshod over the law, grow a pair and do it! Don’t dickfuck around trying to ‘cover your ass’!

Only scoundrels need the ‘cloak of secrecy’…as we have witnessed. If we are to enjoy a just society, we must deny this cloak to all who seek it.

Um, will these ‘alterations’ to the legal system put everything on the ‘right track’ to prosperity?

Um, no.

So what else needs to be done?

Well, it seems we have to address the problem of ‘full time legislators’ who are beyond the reach of those who elect them. Is making them ‘more accessible’ the answer? No, that wouldn’t
change things, we’d be just as frustrated by making them subject to recall or ‘suspension’. Nobody has the time or the patience to keep running down to the polls to replace their representative…and for a high enough price; they’d still sell you out! (Which points to another issue that ‘needs fixing’.)

No, the answer lays in a different arrangement altogether. We get rid of (corrupt) elected officials and vote directly on any new proposed legislation. Oh, will what about all of those ‘black budgets’ and ‘aid payments’?

They’d go where they should have gone long ago; they’d disappear. (If you have to ‘buy’ your friends they’re not worth paying for. The moment someone else ups the ante, your ‘friend’ is gone!)

Think about it good citizen, the laws should be ‘simple and few’, there isn’t a need for full time legislators nor to be voting every time you turn around.

So, have we fixed it yet? Are we ‘back in business?’

Sadly, no.

Returning our economy to prosperity is going to take some ‘rearranging’ too. One of the ‘selling points’ of Globalization was the off-shoring of ‘dirty’ industries. The reality is if you don’t participate in a particular endeavor, it is not possible to innovate in that field. (Thus you are forced to buy the technology…or do without it.)

So, yes, we will return to a large degree of ‘redundancy’ within certain basic industries but hey, it’s not like we don’t need the jobs!

Flipping that rock over, the work week/day will change also…to facilitate the sharing of what work there is.

Oh, there will be another, er, ‘change’ in the way things are done. Ownership will be abolished, meeting the needs of society is too important to entrust to private entities, besides, they have been screwing us since the beginning.

Remember a few essays back I spoke of companies earning more than six hundred thousand dollars per employee? Well, doesn’t that represent lower prices the customer never saw and raises for the employees that didn’t happen?

You want to ‘own’ a business? People in Hell want ice-water…how’s it feel to want?

Those resources already belong to you and me, there is no justification for ‘chiseling Charlie’ to gouge us for what was free to them!

Geez, all of these changes! Why not just roll things back to 1970 and run with that?

Because we aren’t in Kansas anymore, Toto.

We can’t leave the broken system that caused the disaster in place because we will end up right where we started, quicker than you’d ever imagine!

So, that’s it? We throw the Lawyers in the lake, the judges too, then we toss the legislature in behind them and the damn bosses on top of the whole heap! (is there anybody left?)

Well, yeah…we haven’t fixed the financial sector yet…and yeah, the ‘solution’ is the same as it is for the legal sector…wipe ‘em out!

In this case, literally. One of the other features we’d introduce is the absence of cash or any cash-like substance.

There simply wouldn’t be any. All of your money would reside in your account that your employer would maintain for you…so, bye-bye bank! Um, the stock market, gone! Also gone would be the entire insurance industry, a just civilization doesn’t need it.

Sorry if this was boring…re-ordering society is pretty dry stuff…but necessary. What we had is broken beyond repair…it is a big mistake to even entertain the idea it can be fixed!

The major pieces you need to build a new social model are here. I omitted many of the ‘details’ but they can be found in the full 70 page document titled ‘A Simple Plan’.

Just feel compelled to keep trotting this bad boy out every few months so you won’t forget about it. Especially as we’ll be needing it soon.

Thanks for letting me inside your head,


Tuesday, February 23, 2010

No longer a 'viable entity'

Greetings good citizen!

I have many times pointed to 'currency manipulation' as the principal cause of the destruction of our economy.

Do you know why I make such an outrageous claim? I make it partially because the people living in the 'cheaper there' should be dead, but that's only the half of it.

Letting the bankers play both ends against the middle is how the economy crashed and burned...note I use the present tense...the economy IS gone, it's 'cooked' and there is no 'bringing it back (although that's not what dopey thinks. Who is 'dopey''ll see.)

On the other hand, I learned something from this piece. I learned the importance of the gold standard and why the global economy 'turned to shit' once the 'gold standard' was, er, 'abandoned'.

Without the gold standard (everybody's money tied to an 'agreed upon' standard) Bankers were free to 'assign' different values to different nation's currency, where they proceeded to use those 'non-existent' differences to make themselves a ton of money!

The 'screw-job' here is a pig is a pig and a duck is a duck and a buck is a buck no matter where you find it, and they're all priced by the pound for the consumer's convenience. A pound of chicken in Beijing is identical to a pound of chicken in Berlin, which is a carbon copy of a pound of chicken in Bayonne (N.J.,USA)

To an extent, food is better than a 'gold standard' because we all need to eat but we don't all need gold. In fact, nobody would die if they never in their entire life so much as laid eyes on gold...that's how 'unnecessary' gold is. You can't say the same thing for food, and the fucktard bankers know this.

YET, I spend on food each week what the average Chinese worker earns in a month! How do you suppose THAT works? One of us is getting 'ripped off' and guess who it is?

Do the math, it's me! (and by extension, you!) Not only are we paying many times what the Chinese worker pays for food but we are losing our jobs to them in the bargain.

How do you like your 'Wall Street Banker' now?

Anyway, onward with tonight's offering

“The US is not a viable concern anymore” – Duncan
Posted by Izabella Kaminska on Feb 17 13:45.

FT Alphaville spoke with Richard Duncan, partner at Blackhorse Asset Management and author of The Dollar Crisis on Tuesday, regarding his new book The Corruption of Capitalism. And while he is pretty pessimistic on the US, Duncan says there is a way out if policymakers make bold decisions. [I completely agree, however, you’d be hard pressed to call what comes out on the other end ‘capitalism’.]

But first some background. In the Dollar Crisis, published in 2003, Duncan explained how the collapse of the Bretton Woods system in 1973 was always going to lead to a global financial crisis due to the trade imbalances it encouraged and created. Based on the premise, Duncan successfully predicted the subprime problem, the downfall of government sponsored agencies as well as the banking crisis (and related bailouts) we’ve all — seven years on — come to know and love. [Most of us who have been predicting crisis are being ‘exonerated’ although most of us had the timing way off.]

Simply put, according to Duncan, the breakdown of the gold standard allowed too much paper-money to be created in the US. This de facto funded the US deficit, which respectively fuelled a savings glut in Asia. That inevitably drove dollar inflows back into the US — which themselves, over the course of a four-decade period, fueled a global credit bubble of simply gargantuan proportion.

In Duncan’s words, the collapse of Bretton Woods represented the moment “capitalism became corrupted by government debt”. From that point on “US policymakers abandoned the core principles of economic orthodoxy: balanced government budgets and sound money”. [Open for debate here is who the government acted on the behalf of, it sure as hell wasn’t in the best interests of the ‘non-investor, working class!’]

One chart reflecting the situation well according to the author is this one: [click link to view chart.]

In Duncan’s eyes it clearly shows the breaking of the global financial system’s imbalanced back.

To his frustration, though, it’s not a point that’s been grasped by policymakers yet. Policy response if anything has been ill-fitting, meaning the world’s economy is on life support — at best. As he explained to FT Alphaville:

Last year the US economy shrank by 2.4 per cent. But the budget deficit was 10 per cent of GDP. Without that deficit spending, the economy would have shrunk by at least 12 per cent, i.e. -2 per cent plus -10 per cent. Even after that deficit spending, the unemployment rate is 10 per cent, interest rates are zero, and central banks around the world are printing enormous amounts of paper money to prevent economic collapse. This policy response is supporting the global economy but it has not even targeted the structural flaws responsible for the crisis.

The point being: the world’s largest economy and engine of global economic growth — the United States — is simply not a viable concern any more. As Duncan explained it:

The country is de-industrializing because wages in the US are up to 40 times higher than those in developing countries like China. [This is due to currency manipulation, which starts where? With BANKS of course!] Therefore, the United States makes very little that the rest of the world cannot buy somewhere else much more cheaply. [Understand, we didn’t price ourselves out of the market, the sleaze-ball bankers did it for us! How, by abandoning the ‘universal standard’ that gold provided.]

And so, like any troubled company, the US too must restructure itself if it is to remain operational, says Duncan. How it goes about it, though, will be crucial to its success. The best policy according to the author would be heavy government investment in so-called ‘future’ industries — everything from solar, biotech, nano-technology and so on. Trouble is, a move like that would take more government spending not less. [It would also be extremely ‘moronic’ if we fail to ‘re-anchor’ our/the world’s currency to a universal standard. This has become an exercise where the lesson is ‘not everyone who agrees with you has a fucking clue!’]

Duncan estimates some $3,000bn or so on top of the $10,000bn already estimated in deficit spending over the next 10 years would be needed to put the US back on top of the global industrial game in this way.

Full stop! I have mentioned before that I usually select the day’s offering by the ‘headline’ more so than the content, which I read in detail as I ‘highlight’ the writer’s main points.

Sometimes, and this happens to be one of them, you agree with the headline but hardly any of the rest of what THE CLUELESS BASTARD has to say!

What do you suppose adding three trillion to an already ‘towering inferno’ is going to accomplish? Perhaps more amazing is how these clueless bastards ignore the present crisis in Zimbabwe!

Ilargi enlightens us to this ‘more better’ syndrome (albeit not very clearly.) So I’ll ‘recap’ here in a nutshell, when you’re drowning, more water doesn’t help anything!

That sailed right over roughly 50% of your heads, let’s try again.

A quarter buys you a chocolate bar…so two quarters would buy you two chocolate bars…except when there aren’t two chocolate bars to be had, there is still only the one.

This is the heart of the crisis, adding money doesn’t increase the amount of available resources, no matter how much money you add! (Governments around the world have been pumping trillions of ‘dollars’ into their economies without adding any corresponding ‘real wealth’, which merely ‘dilutes’ the value of ‘existing money’ and makes us all ‘net’ poorer.)

Are you working for nothing yet? Pretty much.

Back to the article…

The worst-case scenario, meanwhile, would be America turning into Japan while it attempted to do just that. On the flip side, it’s from Japan’s experience that valuable lessons could also be drawn. As Duncan explained (our emphasis):

When Japan’s bubble popped in 1990, the Japanese government’s debt to GDP was 60 per cent. The Japanese economy has been on government life support since then and government debt to GDP is now more than 200 per cent.

During the bubble years of the 1980s, a great deal of profit was made in Japan. That money was available to finance the expansion of government debt after the bubble popped. If it had not invested in government bonds it would have been destroyed, because there are no viable investment opportunities in a post-bubble economy. So the private sector has financed the expansion of government debt in Japan, and it has done so on concessionary terms.

The 10-year Japanese government bond yield is only 1.3 per cent. Now that the US bubble has popped, the US government will also be able to greatly expand its debt. But the lesson the US must learn from Japan is not to waste that money building bridges to nowhere, but instead to use the money wisely to restructure the economy to restore its viability. This global crisis will not end until the United States restructures its economy and restores its long-term viability. [What do you suppose the odds are of that happening quickly enough to save the doomed Boomers? What do you suppose the odds are that the Boomers will burn this clam shack to the ground?]

The consequences of a scenario where the US failed to respond effectively, meanwhile, would be grave indeed. Not only would the US slip into irreparable decline, according to the author, globalization would break down and export-oriented Asian economies could collapse. [Change ‘could’ to ‘would’, albeit the commies have a better chance of surviving a collapse than the predatory capitalists do...]

End of an era for Asia?

But if Duncan’s view here is bleak, it’s even bleaker on the China situation. As he stated:

…regardless of what happens in the US, China is facing a much more difficult future than is generally believed. Every boom busts. Every bubble pops. China will be no exception.

It is a serious mistake to believe China’s economy will continue to grow at 8 per cent or more for the next decade. That’s what people believed about Japan in 1989. Today, Japan’s economy is no larger than it was in 1993, if you don’t adjust for deflation. 2 per cent to 4 per cent annual GDP growth would be an excellent outcome for China over the decade, in light of the enormous capital misallocation that has occurred there over the past 10 years.

The economic crisis in the United States means Asia’s era of export-led growth is over. A protectionist backlash in the West will force China to substantially revalue the Yuan to avoid trade tariffs in the United States and Europe. Other Asian currencies will follow the Yuan higher. Finally, the direction of asset prices in Asia, and around the world, will be determined by the size and timing of successive rounds of government stimulus packages in the United States and within Asia. The global economy will remain on government life support for years to come. [When energy becomes scarce the ‘global economy’ (as it currently exists) will collapse, this is not a question of ‘if’ but ‘when’. (We will, as we have for centuries, trade worldwide. Most commodities will be sourced ‘locally’ as the return of wind driven ocean travel makes cargo hold space ‘pricey’ once more.)]

So that’s pretty much bad news for Asia under every conceivable scenario.

And if gold bugs were hoping for a call back to the gold standard, we would have to disappoint.

Duncan’s view is that we’re now beyond a return to a gold-pegged system. The best we can hope for in terms of restricting future imbalances is regulatory reform focused on keeping credit creation at banks in check. As he summed up:

…we’re simply not in the garden of Eden scenario anymore.

While I might be inclined to agree that we won’t see the ‘gold standard’ re-instated, there is no ‘cure’ for the badly unbalanced global economy if the currency situation remains…’open to banker’s interpretation’.

If they keep on ‘fudging’ the value of the dollar the way they have been, we will all walk off the job in disgust. There won’t be any point in ‘working for the man’.

It’s difficult to image something more terrifying than finding out your money is no good. If you don’t have something to trade, you are well and truly.

Thanks for letting me inside your head,


In case you’re interested, here’s the official version of today’s market ‘bellyflop’.

Monday, February 22, 2010

Social Cohesion

Greetings good citizen,

Finally, someone (besides myself) is raising the issue of ‘social stability’. Maybe it’s a ‘sign of the times’ but this piece also attempts to tackle/explain the, er, ‘abnormally stable’ social environment…even if it concludes the current stability is ‘temporary’ at best.

Indeed, even I have been made to look foolish for predicting bloodshed that has, thus far, failed to materialize. That said, every additional day of ‘social cohesion’ since roughly last summer has been a ‘gift’.

With the commencement of the withdrawal of financial support to our economy, what has passed for civilization will crumble and fade away.

When the days grow short and the 2010 Holiday season gets underway, the snow will fall on a vastly changed landscape. It’s not a question of ‘if’ but of ‘how bad’?

So we arrive at tonight’s offering Where Jesse paints a rather grim landscape for our consumption…

Modern Economic Myths and The Failure of Financial Engineering

"The whole history of civilization is strewn with creeds and institutions which were invaluable at first, and deadly afterwards." Walter Bagehot

The housing bubble did nothing for real median incomes in the US but it did wonders for the insiders in the financial sector.

This is why the average Joes in the States went into debt to continue to maintain their consumption.

Until this situation is addressed, there will be no sustained economic recovery in the US. The US Census Bureau only goes to 2007, but it is highly likely that the median income has taken another serious downturn in the latest financial crisis.

Very little has been done by the Obama administration to address this problem.

Trickle down or supply side economics does well for the upper percentiles of income but does much less for the median wage.

Why care? For several reasons.

First, the median wage is the bulwark of general consumption and savings, and the prosperity of a nation. It must match the character of the social fabric, or place a severe strain on the contract between classes and peoples. A nation cannot survive both slave and free without necessarily resorting to repression.

Second, in any relatively free society, the reversion to the mean in the distribution wealth and justice is never pleasant, and often bloody and indiscriminate.

There are several economic myths, popularized over the last thirty years, that are falling hard in the recent series of financial crises: the efficient market hypothesis, the inherent benefits of globalization from the natural equilibrium of national competitive advantages, and the infallibility of unfettered greed as a ideal method of managing and organizing human social behaviour and maximizing national production.

One has to wonder what would have happened if some more coherent, approachable science, had put forward a system of management that relied upon the nearly perfect rationality and unnatural goodness of men as a critical assumption in order to work? They would have been laughed out of the academy. Yes, there is a certain power to befuddle and intimidate common sense through the use of professionally specific jargon, supported by pseudo-scientific equations.

Why doesn't 'greed is good' work? Because rather than work harder, a certain portion of the population, not necessarily the most productive and intelligent, will immediately seek rents and extraordinary income obtained by unnatural advantages, by gaming the system, by cheating and coercion, by the subversion of the rule of law, which will sap the vitality of the greater portion of the population which does in fact work harder, until they can no longer sustain themselves. And then the greedy seek to expand their venality, and colonies and then empires are born.

What will take the place of these modern economic myths? Time will tell, and it will vary from nation to nation. But the winds of change are rising, and may soon be blowing a hurricane.

It is foolish in the extreme to entertain the idea that social cohesion will withstand a persistent stream of falsehoods…or that those falsehoods will not collapse under scrutiny.

Here’s an example of how the motives of the banking sector can easily be laid bare…it’s not too tough if you know what you’re looking at.

On the same vein, we have this Krugman piece which highlights the conundrum the ‘Starve the Beast’ conservatives have made for themselves…

Just because things haven’t fallen apart yet doesn’t mean they won’t…

Thanks for letting me inside your head,


Sunday, February 21, 2010

Nothing to see here...

Greetings good citizen!

What joyous tidings are in store for us today? How about the top headline from today’s New York Times?

“Millions of Unemployed Face Years Without Jobs”

Methinks the operative word here is ‘YEARS’, especially for people who have already been out of work more than two years now.

This is a disaster and it’s even worse than it appears because we were already ‘carrying’ a third of the workforce/population. (The over 80 million ‘discouraged workers’ not counted as being ‘in the workforce.’ Never mind the 40% of the ‘official’ workforce that only works part-time because that’s all there is.)

What two questions pop into your mind good citizen? What is being done about the (obviously) incompetent management of the US economy?” [Answer: we’re giving them bonuses!] and ‘What does this mean for the future of the Republic?” [Answer: You’re not in Kansas anymore, Toto…]

What should really ‘blow your mind’ is that they are still clinging to the fantasy that the economy is ‘recovering’…while openly admitting the job market will not/can not accommodate those thrown on corporate USA’s scrap pile.

What’s truly frightening here is the question of how these nincompoops define the term ‘economy’, apparently it doesn’t mean what we think it means.

Somewhere down the line the definition got perverted into something along the lines of ‘the system that lines our pockets with money’ as opposed to the system that supports society.

There is no lack of things that need doing, what we have here are people who don’t want to pay to get things done…a.k.a. incompetent management.

Worse, these people are so incompetent that they ignore half of their job! The ‘human relations’ half is left for the ‘resource’ to handle on its own.

Can’t live on what they pay you? Tough, it’s not their problem…it’s yours!

So…what are you going to do about your little problem? There certainly isn’t a ‘legal’ avenue where you can pursue a remedy, in fact, the law is the problem…people with this problem don’t have the necessary ‘re$cource$’ to seek satisfaction.

Well, if you’re too impoverished to sue for justice/protection, your only choices are A.) die or B.) do it yourself ‘justice’ (a.k.a. ‘steal what you need’. Using the word ‘commandeer’ doesn’t alter the material facts of the matter.)

Just one more little ‘gripe’ before we plunge into the greatly abbreviated article and that would be the disturbing tendency of the MSM to use ‘personal stories’ so the conservatives among us can tar all of the unemployed as lazy and worthless with the same brush.

In this multi-paged tome we follow the personal ‘tragedy’ of one 57 year-young woman and her invalid husband. The article does provide ‘snapshots’ of other victims but the focus is mainly on this couple…’shrinking’ the crisis to just a ‘few people having a hard time’.

We’re talking a third of the nation here good citizen…don’t lose sight of that fact.

Millions of Unemployed Face Years Without Jobs

Published: February 20, 2010

BUENA PARK, Calif. — Even as the American economy shows tentative signs of a rebound, the human toll of the recession continues to mount, with millions of Americans remaining out of work, out of savings and nearing the end of their unemployment benefits.

Economists fear that the nascent recovery will leave more people behind than in past recessions, failing to create jobs in sufficient numbers to absorb the record-setting ranks of the long-term unemployed. [Yet not one of these fucktards dares to point at the source of this affliction…off-shoring!]

Call them the new poor: people long accustomed to the comforts of middle-class life who are now relying on public assistance for the first time in their lives — potentially for years to come. [Understand, these people were ‘the old poor’ who weren’t yet living in the gutter, which is where they’re headed. Massa don’t need Toby no more so he threw him (and his chillun) out in the street to fend for demselfs! Poor, poor Massa, saddled with ‘unproductive peoples!’ for about thirty seconds--then he palmed them off on John Q. Public.]

Yet the social safety net is already showing severe strains. Roughly 2.7 million jobless people will lose their unemployment check before the end of April unless Congress approves the Obama administration’s proposal to extend the payments, according to the Labor Department. [What do you think good citizen? will they ‘extend’ or will they cut them loose? (They have to eventually.) There is a ‘third choice’ but it doesn’t exist under ‘borrow and spend’ capitalism…]

Here in Southern California, Jean Eisen has been without work since she lost her job selling beauty salon equipment more than two years ago. In the several months she has endured with neither a paycheck nor an unemployment check, she has relied on local food banks for her groceries. [Um, the ‘safety net’ wasn’t designed to withstand this kind of ‘abuse’. Most unemployment checks are the product of stimulus money because the states have long ago exhausted their ‘employer funded’ unemployment pools.]

She has learned to live without the prescription medications she is supposed to take for high blood pressure and cholesterol. She has become effusively religious — an unexpected turn for this onetime standup comic with X-rated material — finding in Christianity her only form of health insurance.

“I pray for healing,” says Ms. Eisen, 57. “When you’ve got nothing, you’ve got to go with what you know.” [Is this a ‘snapshot’ of life with our virtually ‘non-existent’ social safety net or is this an endorsement for ‘faith-based’ salvation? Pray and you shall receive?]

Warm, outgoing and prone to the positive, Ms. Eisen has worked much of her life. Now, she is one of 6.3 million Americans who have been unemployed for six months or longer, the largest number since the government began keeping track in 1948. That is more than double the toll in the next-worst period, in the early 1980s. [Bizarre how this seriously malfunctioning management ‘philosophy’ has managed to cling to life in the minds of our executives, isn’t it? Worse, we seem unable to rid ourselves of them or it!]

Men have suffered the largest numbers of job losses in this recession. But Ms. Eisen has the unfortunate distinction of being among a group — women from 45 to 64 years of age — whose long-term unemployment rate has grown rapidly. [In general, people closing in on retirement have suffered ‘disproportionately’ over the past thirty years…]

In 1983, after a deep recession, women in that range made up only 7 percent of those who had been out of work for six months or longer, according to the Labor Department. Last year, they made up 14 percent. [That statement was akin to asking if the rain would hurt the rhubarb, who gives a fuck? Which is to say the problem is definitely larger than ‘females 45 to 64’ so WTF?]

Twice, Ms. Eisen exhausted her unemployment benefits before her check was restored by a federal extension. Last week, her check ran out again. She and her husband now settle their bills with only his $1,595 monthly disability check. The rent on their apartment is $1,380.

“We’re looking at the very real possibility of being homeless,” she said.

Every downturn pushes some people out of the middle class before the economy resumes expanding. Most recover. Many prosper. But some economists worry that this time could be different. An unusual constellation of forces — some embedded in the modern-day economy, others unique to this wrenching recession — might make it especially difficult for those out of work to find their way back to their middle-class lives. [Another ‘pet peeve’ if you’d indulge me…has anyone else noticed how the ‘working class’ has all but disappeared from our social discourse? Working class is not ‘middle class’, they are separated by that stinking piece of ‘sheepskin’. Part of the serious disservice the MSM has foisted upon us is promoting this ‘myth’ that working class is synonymous with ‘middle class’. Is it any coincidence that ‘jobs’ have disappeared along with our ‘working class’?]

Labor experts say the economy needs 100,000 new jobs a month just to absorb entrants to the labor force. With more than 15 million people officially jobless, even a vigorous recovery is likely to leave an enormous number out of work for years. [How many of you caught the fact that this number is 50,000 jobs shy of the old standard? What the hell happened, did our population ‘shrink’ somehow? This is ‘Globalization. This is ‘Off-shoring’. This is your fucking Politicians sleeping with the enemy!]

Some labor experts note that severe economic downturns are generally followed by powerful expansions, suggesting that aggressive hiring will soon resume. But doubts remain about whether such hiring can last long enough to absorb anywhere close to the millions of unemployed. [Stupid is as stupid does…this is just ‘jaw-flapping’, there is no way the economy is going to ‘re-bound’, the consumer is too broke to keep this lop-sided economy moving forward, and that’s a fact Jack! But like most ‘neo-con lies’, repeat until true…]

A New Scarcity of Jobs

Some labor experts say the basic functioning of the American economy has changed in ways that make jobs scarce — particularly for older, less-educated people like Ms. Eisen, who has only a high school diploma.

Large companies are increasingly owned by institutional investors who crave swift profits, a feat often achieved by cutting payroll. The declining influence of unions has made it easier for employers to shift work to part-time and temporary employees. Factory work and even white-collar jobs have moved in recent years to low-cost countries in Asia and Latin America. Automation has helped manufacturing cut 5.6 million jobs since 2000 — the sort of jobs that once provided lower-skilled workers with middle-class paychecks. [That’s a bald-faced lie, most of those 5.6 million jobs were lost to off-shoring, automation has been with us for the past thirty years, there isn’t a single domestic shop out there that hasn’t been automated for decades!]

“American business is about maximizing shareholder value,” said Allen Sinai, chief global economist at the research firm Decision Economics. “You basically don’t want workers. You hire less, and you try to find capital equipment to replace them.” [Um, without customers, here is no business…so this model is sporting a rather obvious ‘flaw’, isn’t it? let’s take that a step further, shall we? How does fuckhead become a ‘chief global economist’ without spotting this himself? Is he stupid or does he just think the rest of us are?]

During periods of American economic expansion in the 1950s, ’60s and ’70s, the number of private-sector jobs increased about 3.5 percent a year, according to an analysis of Labor Department data by Lakshman Achuthan, managing director of the Economic Cycle Research Institute, a research firm. During expansions in the 1980s and ’90s, jobs grew just 2.4 percent annually. And during the last decade, job growth fell to 0.9 percent annually. [Which, naturally, wasn’t fast enough to take up the ‘natural growth’ in the workforce.]

“The pace of job growth has been getting weaker in each expansion,” Mr. Achuthan said. “There is no indication that this pattern is about to change.” [Dunno what you’re reading here good citizen but I can tell you what the infamous ‘they’ hope you’ll take from this article; “This situation is permanent, so fucking deal with it.” Which isn’t true at all. The ‘problem’ here is ‘conflicting goals’, you can’t develop the markets of Asia without sacrificing the smaller US market…and the citizens of the US have gotten used to, er, ‘living well’. ‘Push’ is going to come to ‘shove’ real soon and we’ll all see what’s left after those that ‘invest’ try to strangle those that do.]

Before 1990, it took an average of 21 months for the economy to regain the jobs shed during a recession, according to an analysis of Labor Department data by the National Employment Law Project and the Economic Policy Institute, a labor-oriented research group in Washington.

After the recessions in 1990 and in 2001, 31 and 46 months passed before employment returned to its previous peaks. The economy was growing, but companies remained conservative in their hiring. [Truth be told, the workforce has remained at a virtual stand-still compared to population growth since 1990.]

Some 34 million people were hired into new and existing private-sector jobs in 2000, at the tail end of an expansion, according to Labor Department data. A year later, in the midst of recession, hiring had fallen off to 31.6 million. And as late as 2003, with the economy again growing, hiring in the private sector continued to slip, to 29.8 million. [Um, is there something wrong with these figures? We know that every month the economy sheds roughly 2 million jobs, with some of those people being ‘re-hired’, some sooner than later but there it is. So what the fuck is up with this 34, 31 and 29 million figures? Are these ‘annual’ employment figures? Seems to me we have a ‘retention problem’ on our hands, where employers with itchy trigger fingers keep ‘churning’ their labor forces in an effort to hire the ‘cheapest’ workers they can get away with…while lining their pockets with the ‘savings’. Did I mention how ‘predatory’ our system of commerce has become?]

It was a jobless recovery: Business was picking up, but it simply did not translate into more work. This time, hiring may be especially subdued, labor economists say. [No need to get rid of your current workers, this time all you need do is tell them they have to accept less pay or they can hit the door, that way you keep the people you’ve already trained! It’s a double win…for you!]

Traditionally, three sectors have led the way out of recession: automobiles, home building and banking. [Uh-oh!] But auto companies have been shrinking because strapped households have less buying power. Home building is limited by fears about a glut of foreclosed properties. Banking is expanding, but this seems largely a function of government support that is being withdrawn. [Banks are too big to support the volume of business that is no longer there, so what’s this ‘expanding’ nonsense?]

At the same time, the continued bite of the financial crisis has crimped the flow of money to small businesses and new ventures, which tend to be major sources of new jobs.[snip]

Marx didn’t say it first but he said it loudest…Businesses HATE competition! Lower prices for you means less profits for them! They don’t get rich cutting you any slack! Beginning to get a clue as to what’s wrong with this picture?

Worse is the fact that they justify this behavior by claiming ‘everybody else is doing it!’

Perhaps the truth is bad enough, those who refused to play by this warped and twisted ethos have gone out of business. The smart ones cashed out before they were driven out, they could see the writing on the wall.

The question you need to ask yourself here good citizen is, ‘How long can our society let ‘millions’ (of basically redundant) workers hang around doing nothing?

Is the intent to let these people starve to death? There doesn’t appear to be any ‘accommodation’ being made for them (save the rumored Haliburton prison camps.)

Worse, what are these people ‘guilty’ of…outliving their usefulness? (To the wretched, money-grubbing capitalists!) It will be a sad day indeed when that becomes ‘just cause’ to lock people up.

Of course, that is not the reason they will use. Ironically, they will be imprisoned for their indebtedness to a world that no longer has a use for them…through no fault of their own.

Perhaps more interesting is the subject of how ‘in your face’ articles like this one come and go without elevating the level of public discourse.

Nothing to see here, move along now if you’re not going to buy anything.

Thanks for letting me inside your head,


Saturday, February 20, 2010

Rich man, Poor man

Greetings good citizen,

How’s that ‘economic recovery’ working out for you? What’s today’s latest lie…foreclosures are ‘slowing down’ (although the volume of homes in foreclosure increased, the number of people late on their payments dropped…

Which proves what? That more people tapped their 401k’s to get current rather than walked away? The principal ‘attraction’ to purchasing a home is, unlike rent, mortgage payments have the potential to be recaptured, rent checks are ‘gone for good’.

Which is to point out that a lot of people who should ‘walk away’ won’t…because renting is like taking a match to the money. That and (especially these days) ‘landlords’ have become mighty picky about who they will rent to and what they will permit under ‘their roof’.

Besides having to cough up first, last and security, you may be charged by the inch/pound in order to obtain house space for either fido or fluffy. If you smoke, some landlords have become so hardcore that they will not let you smoke in ‘their unit’. Others will let you indulge…if you’re willing to pay for the ‘privilege’. I have yet to hear of a test case but we can only imagine what would happen if a smoker decided they wanted to see how the law felt about ‘discrimination’.

Who do you think would win? If it’s ‘your’ house you can do as you please…if it isn’t ‘your house’…oh well.

Naturally, I digress… tonight’s offering has less to do with home ownership than it is about the prospects of owning your own home…ever again.

Which is pretty bizarre considering there is no shortage of $1 homes out there…they just happen to be situated in the middle of what we might call an ‘economic wasteland’. If you’re not one of those lucky people who can do what they do, wherever they like, you might find the eating thing more than a little challenging. Never mind the public safety, public services, public utilities and the whole ‘shopping’ thing.

Yeah, it is a bizarre juxtaposition between ‘affordable housing’ and a functioning community.

Left to your imagination is how long YOUR neighborhood will remain ‘economically viable’. It’s not the kind of thing people spend a lot of time thinking about…not until it’s too late to do anything about it.

Even worse, you don’t get a vote in the situation. A community’s largest employer isn’t required to put the decision of moving most of its operations off-shore on the ballot. Hell, they are only required to ‘notify’ the affected community some nebulous period before they act. (This is so ‘conditional’ that the only thing you can say for sure is they are prohibited [in most cases] from announcing today and moving tomorrow.)

What do you do when you learn that the lion’s share of the local tax-base in enroute to some god-forsaken Banana Republic? Stick a ‘for sale’ sign in your front yard? (And hope to hell you sell before the unwitting buyer learns they have bought a ‘White Elephant’.)

Like our friend Mr. Roberts point out, it is only a matter of time before the US military comprises the bulk of our economy.

What you have to wonder about is who would be stupid enough to supply a nation whose only ‘output’ is destruction?

Maybe the ‘real terrorists’ (a.k.a. capitalists?)

Perhaps the most disturbing aspect about tonight’s piece is the swiftness at which the capitalists have abandoned us.

A Shift in the Export Powerhouses

Published: February 19, 2010

IN the first decade of the 21st century, world exports boomed and then fell sharply. And there was a restructuring of the major manufacturing nations of the world.

In 1999, the top five exporting countries were the traditional industrial powers — the United States, Germany, Japan, France and Britain. Combined, they accounted for 43 percent of the exports reported by 40 large countries.

As can be seen in the accompanying charts, a new order has emerged. China went from the ninth-largest exporter in 1999 to the largest in 2009. Germany, which passed the United States to become the largest exporter from 2003 to 2008, wound up in second place as the United States fell to third. Britain tumbled to No. 10, from No. 5. [Not shown here is the shift from finished goods to raw materials/food.]

All told, the share of exports of the Big Five of 1999 fell to 34 percent in 2009. That loss of nine percentage points was matched by a similar gain for China, India and South Korea, with most of the gain going to China.

Measured in dollars, Chinese exports rose at a compound annual rate of 20 percent through the decade. [US retailers made a killing while the manufacturing sector shrank dramatically.]

China even did better than most in 2009, when the combined exports of the 40 large countries fell by 21 percent. China’s dropped by 16 percent that year.

Among the top 12 shown in the graphic, the largest declines in 2009 — all of 25 percent or more — were recorded by Japan, Italy and Canada. The United States suffered an 18 percent drop. [Because we lost most of our manufacturing capacity in the previous decade…]

The 40 countries included in the tally are the largest ones for which figures are available through at least November. Among them, all but Belgium and Spain have reported December numbers. Their figures were estimated based on trends from September to November.

Countries that report figures either annually or quarterly were not included. The largest exporters thus left out are mostly oil exporters, including Saudi Arabia. The figures cover exports of goods, not services. [Which has been providing a false image of what the US exports…many US ‘intellectual properties’ are not developed in the US, only the capitalists who own the rights to those properties are situated here. Hell, even the money from the sale of these properties remains off-shore!]

During the decade, American exports rose at a compound rate of a little more than 4 percent. That was far behind China and other emerging Asian exporters like South Korea (10 percent) and India (16 percent). But it was faster than Britain, Canada or Japan. [Um, without being specific there is no way to verify these claims, worse, the lion’s share of these ‘export figures’ are actually the activity of US owned, foreign based operations with most of their sales being generated overseas…the money or the products NEVER see our shores. Which is to say you have a better chance of being killed by one of these companies products than you have of ever being employed by one of these ‘in name only’ US companies.]

Those figures are in nominal dollars, not adjusted for inflation. The gains would be different if measured in other currencies, like the euro or yen, but the order would be the same.

There are indications of strong rebounds in exports as the world economy begins to recover. In December, American exports were 21 percent above where they had been in the same month of 2008, compared with China’s 18 percent rise. China’s exports were still much larger than those of the United States. [As you can see, those two statements directly contradict each other…so we are obviously talking apples and oranges. How can either nation’s exports be surging when consumers in both nations are hurting? If it doesn’t make sense, it’s probably a ‘lie’]

Only a few countries, mostly in Asia, have reported January figures, but some of them showed explosive gains from the depressed levels of early 2009. China’s exports rose 21 percent, but that paled in comparison to the 47 percent gain reported by South Korea and the 77 percent increase in shipments from Taiwan. [Again, without specifics, it’s impossible to tell what is responsible for the spike in activity…maybe all of these nations are stocking up on tear gas and riot batons…]

A significant part of those gains may reflect the need to fill depleted inventories, rather than a surge in consumer demand. It remains to be seen whether world trade can return to the sustained high levels shown from 2003 through 2008, when exports of the 40 countries rose by more than 10 percent every year.

Mother to Christ! Now we have proof that the MSM thinks YOU are STUPID! If the customer base doesn’t expand by 10 percent per year, how the hell do exports rise by that amount? The only thing that accounts for such, er, ‘growth’ is INFLATION, they aren’t talking an uptick in physical product, they must be talking about ‘growth’ in terms of dollar volume! Which tells you spit! Do you hate economists? You should!

Which points to another ‘trick’ commonly used to, er, ‘distract’ the rabble…keep switching units of measure without letting anyone know that you are comparing apples and oranges and people will be baffled…unless you are talking to someone like me, I’ll nail your nuts to a pole!

You’re either going to be saying ‘I don’t know’ a lot or you will be back-pedaling your ass off.

All that glitters is not gold and all that rises in not growth…

Thanks for letting me inside your head,


Friday, February 19, 2010

Beware of Monsters....

Greetings good citizen,

For the first time in over a year the Fed raised interest rates, and, unsurprisingly (although it will inevitably ‘surprise’ Wall Street analysts, they are ‘surprised’ if the sun rises!) the dollar also…(ahem) rose as well. (I saw a graph… it didn’t rise much!) Like most ‘economic indicators’ the ‘rises’ have been limited to the hundredths of a percent, literally not enough to lift the results out of the ‘margin of error’ for these dubious measurements.

But what the hey, there’s no law against investors being both stupid AND crazy…

The rest of us aren’t ‘blameless’ either, who do you think is picking up the tab for these idiots crazy bets? Yeah, I’m looking at you…not that there is anything you can do about it. Just saying, ya know?

Which brings us where good citizen? Just what is causing that loud sucking sound? Correct me if I’m wrong but there seems to be some confusion as to what the ‘name of the game’ is. You can’t escape the true purpose, which is survival…but for some bizarre reason, the most successful survivors are parasites! (Who ironically claim to be ‘rugged individualists’ who ‘earn’ every penny they steal…from you! If you got a dope slap for every time these losers hosed you, your head would cave in!)

Um, tonight’s offering provides a poignant example of just how ‘fucked up’ it is to let a few (investors) decide the future of the (unrepresented) masses…

Fed Rate Move Sends Dollar Higher

Published: February 19, 2010

WASHINGTON — The Federal Reserve’s decision to raise the interest rate it charges on short-term loans to banks reverberated in the financial markets Friday, sending overseas stock indexes lower and giving fresh momentum to a recent rise in the dollar. [Yeah, right!]

The Fed took the move to normalize lending after holding interest rates to extraordinary lows for more than a year to prop up the financial system. [Which did what, exactly?] But the decision, announced after the close of equities markets in New York, sent Asian shares lower, with the Nikkei 225 index in Tokyo dropping nearly 2 percent, and both the Kospi index in Seoul and the Hong Kong’s Hang Seng indexes showing similar declines.

The reaction in Europe, however, was much more muted, with the major indexes in Frankfurt, London and Paris regaining lost ground in afternoon trading. Shares in Europe turned positive after a report from Washington that indicated only a slight increase in consumer prices in January. In fact, excluding food and fuel costs, prices actually fell 0.1 percent [Note the decimal and mind the ‘margin of error’!] — the first [Possible, but not necessarily factual] decrease since 1982. Wall Street, which has gained more than 2 percent for the week, is also expected to open slightly lower.

The move also helped propel the dollar’s recent rise even further, reaching $1.35 to the euro, its strongest level against that currency in nine months. [Flipping that rock over, we can be thankful these ‘ups and downs’ haven’t [yet] started to gyrate wildly…as they eventually will when their value falls into serious doubt.]

While the central bank had signaled its intentions to take such a step, the timing was a surprise. The announcement was made in a carefully worded statement that emphasized that the Fed was not yet ready to begin a broad tightening of credit that would affect businesses and consumers as they struggle to recover from the economic crisis. [Um, should such ‘warnings’ be necessary in a properly organized society? I think not!]

But while the move will not directly affect home mortgage, credit card or auto loan rates, it was a clear sign to the markets, politicians in Washington and the country as a whole that the era of extraordinarily cheap money necessitated by the crisis was drawing gradually to a close. [Go ye not gently into eternal damnation…cheap money that benefited so few!]

The Fed’s board of governors raised the discount rate on loans made directly to banks by a quarter of a percentage point, to 0.75 percent from 0.50 percent, effective Friday.

It also took two steps to begin unwinding its efforts to keep the banking system functioning after the real estate bubble inflicted huge losses that were amplified by sophisticated bets made by Wall Street. [Isn’t it bizarre that Wall Street was able to pay out huge bonuses both before AND after the collapse of the Housing Bubble?]

Given the slow and uneven nature of the recovery, an unemployment rate close to 10 percent and fears of a new wave of mortgage defaults, particularly in commercial real estate, few economists expect the Fed to begin a campaign of broader interest rate increases quickly or sharply. The central bank reaffirmed last month that the key short-term interest rate it controls would remain “exceptionally low” for an “extended period,” language it has used since March. [Left unexplained is how this will benefit either society or the economy…it’s been two years now and the ‘recovery’ is still ‘invisible’ (although some would say it is ‘imaginary’…)]

While borrowing by banks from the Fed’s discount window has already fallen to more historically normal levels from its peak in October 2008, many small and medium-size businesses still find it difficult to obtain loans, a major concern of the Obama administration and Congress. [ALL of the money in our economy is ‘borrowed’ into existence, if commercial entities can’t borrow money, there can’t be any kind of ‘recovery’ happening.]

Randall S. Kroszner, an economist at the Booth School of Business at the University of Chicago and a former Fed governor, said after the announcement: “This is a technical change that makes sense as a precondition for other changes, but is not a precursor of short-term change.” [Read that again…does it make any sense? No, and it isn’t just you or me…it’s ‘babble’.]

Having taken a baby step toward a return to normalcy, the Fed’s chairman, Ben S. Bernanke, now faces a delicate dance in the months ahead. [Um, Bobo was just ‘re-appointed’ and it’s likely he will ‘outlast’ the current incumbent in the White House. Will the next idiot our evil overlords parade before us re-appoint him again? Who knows? If nobody ‘charges the Bastille’ between now and then, probably! Look at how long they let the last idiot hang around…]

The central bank will try to drain from the financial system some of the money it created to keep banks and the economy afloat over the last two years. And at some point it will begin putting upward pressure on interest rates by raising its benchmark fed funds rate, the rate at which banks lend to each other overnight. [Provided, of course, our economy survives that long…if it doesn’t, there won’t be a treasonous ‘central bank’ to worry about.]

Uncertainty surrounds the timing and sequence of those steps. Mr. Bernanke is scheduled to present the Fed’s semiannual monetary policy report to the House on Wednesday and the Senate on Thursday — testimony the markets will watch closely. [Don’t you just love the suspense? Like their boy is going to do something ‘shocking’ or ‘out of character’ that they won’t know about long in advance…and you can almost count on such a profitable opportunity occurring.]

As part of the changes disclosed Thursday, the Fed announced that the typical maximum maturity for primary credit loans, in which banks borrow from the discount window, would be shortened to overnight, from 28 days, starting March 18. [What a ‘shocker’, the ‘overnight rate’ will return to being ‘overnight’ and not a whole month…how will the crooked bankers ever manage that?]

The Fed also raised the minimum bid rate for its term auction facility — a temporary program started in December 2007 to ease short-term lending — to 0.50 percent from 0.25 percent. [Geez, why isn’t the media making a big deal about the ‘DOUBLING’ of this key interest rate? Oddly enough, depending on where you look, some are.]

The central bank took pains to reiterate that it was not moving in a sudden new direction.

“The modifications are not expected to lead to tighter financial conditions for households and businesses and do not signal any change in the outlook for the economy or for monetary policy,” the Fed said in its statement. [So what are they saying? This won’t affect the average household because the average household is already carrying far more debt than is advisable? The businesses without customers aren’t good credit risks? Ironically, none of that has changed over the past two years, despite pissing away a trillion dollars in stimulus spending, never mind the multiple trillions spent propping up the ‘unproductive’ banking sector…]

Despite that attempt at reassurance, there were some early signs after the announcement that investors were already beginning to anticipate broader interest rate increases. Stock futures fell in after-hours trading; yields on 10-year Treasury notes rose about seven basis points, or seven-hundredths of a percentage point, to 3.8 percent.

The discount rate applies to loans the Fed makes for very short terms, to sound depository institutions, as a backup source of financing. [Given the scale of foreclosures, how ‘sound’ do you suppose our ‘depository institutions’ are? Chances are excellent that both depository and their ‘investment banking’ counterparts would be flat broke if forced to accurately report their financial standing…]

The Fed’s action represents a widening of the spread between the discount rate and the upper end of the target fed funds rate. The two rates typically move in lockstep, and were a percentage point apart before the crisis. [Understand that during this period of, er, ‘excessively low’ interest rates, (free if you were ‘properly connected’) the stock market has rallied over 4,000 points…for essentially no good economic reason. Whose money do you suppose funded this ‘recovery’…the ONLY visible sign of ANY economic recovery? Making the already rich, richer did what for the economy?]

In an effort to encourage banks to come to it for funds to maintain their stability during the crisis,[The ONLY thing that restored ‘stability’ to the banking system was the resumption of the suspension of honest accounting standards!] the Fed sought to make borrowing from the discount window more attractive than usual — and to reduce the stigma associated with borrowing from the Fed. As the fed funds rate went as low as it could go, the Fed reduced the spread between the two rates to half a percentage point in August 2007 and then to a quarter point in March 2008.

When the target range for the fed funds rate was lowered to zero to 0.25 percent in December 2008, the discount rate dropped to 0.50 percent, its lowest level since World War II.

In testimony Mr. Bernanke submitted to Congress on Feb. 10, he said that “before long, we expect to consider a modest increase in the spread” between the two rates. [Eight days later and here we are!]

And on Wednesday, the Fed released minutes from the discussion of its main policy-making arm, the Federal Open Market Committee, at its last meeting, on Jan. 26-27. Those minutes showed a consensus that it would “soon be appropriate” to begin widening the spread.

Laurence H. Meyer, a former Fed governor who runs a consulting firm, Macroeconomic Advisers, said the Fed had done its best to send clear signals.

“If the markets respond to this on Friday, it will reflect a total lack of comprehension of what the chairman said,” Mr. Meyer said. “Don’t they understand the meaning of soon?”

The Fed said banks should use the discount window “only as a backup source of funds.” [Thought experiment time! Take what you know about ‘money and markets’ and compare that with the ‘chuckleheads’ who attained degrees in finance…then consider how these same assholes drove the global economy off of a very visible cliff! Then begin to wonder just how ‘qualified’ these people are to be making decisions that effect the future of our species…]

And it left open the possibility of widening the spread further in the future, saying it “will assess over time whether further increases in the spread are appropriate in view of experience” with the new half-point spread. [As Mr. Roberts pointed out last night, it doesn’t matter where they set interest rates, it won’t effect the ‘real economy’ either way.]

While liquidity for banks has been nursed back to health, many other sectors remain in a parlous state. [Comatose is likely much closer to the mark…]

Dennis P. Lockhart, president of the Federal Reserve Bank of Atlanta, said after the announcement that along with the increase in the discount rate and the phasing out of special loan programs, the Fed would complete its purchase of $1.25 trillion in mortgage-backed securities by the end of March. [Now you all know this takes these exceeding reckless securities and converts them from being bad bets owned by investors into bad bets owned by you and me, the US taxpayer!]

“All of this is happening because stress in the financial system has abated,” he told the Augusta Metro Chamber of Commerce in Georgia. [Don’t let the shit-weasel sandbag you, the stress in the financial system is being abated BECAUSE the taxpayer is taking it in the jugular for the MBS mess!]

He added: “My point is that the public and markets should not misinterpret today’s move. Monetary policy, as evidenced by the fed funds rate target, remains accommodative. This stance is necessary to support a recovery that is in an early stage and, in my view, still fragile.” [How about ‘non-existent’, Chucklehead?]

Bettina Wassener contributed reporting from Hong Kong and Javier Hernandez from New York.

For a ‘parting shot’ or another ‘sidelong glance’ at our depraved, predatory society we have this article which should really focus our attention on the motives of the ‘investor class’ slime.

Just how far has our society sunk when the investors among us take to funding ‘for profit’ prisons?

Although some would say it speaks volumes about what we’ve become that such a venture has successfully evaded public debate for more than a decade.

Truly, the inmates have overrun the asylum…

Be afraid good citizen, be very afraid.

Thanks for letting me inside your head,