Friday, May 28, 2010

Some things never change...

Greetings good citizen,

Maybe I’m ‘late to the party’ (again) and should have seen this one coming BUT no! After years of watching Japan ‘languish’ in ‘economic hell’ do we/I see evidence that they are suffering from the exact same malaise that afflicts the US.

That ‘Japanese quality’ (idiotic) US ‘middle class’ consumers are so fond of doesn’t come from Japan…it has ‘Made in China’ stamped on it!

Understand good citizen that ‘super efficient’ Japanese workers are literally starving to death while their jobs were ‘off-shored’ to cheaper labor markets.

This is not a ‘local’ or even an ‘isolated’ phenomenon…the ‘buy and sell’ crowd has ‘fucked’ the entire global economy due to their ‘disregard’ for basic economics…your workers are also your customers!

Not paying your workers enough to purchase your products isn’t ‘somebody else’s problem’, it’s yours!

Screw your workers and pretty soon, everybody’s got a problem!

Welcome to Amerika!

We have two offerings tonight, both ‘illustrate’ the depth of the problems we face as a society…problems caused by seriously twisted individuals, acting in concert to serve their own warped self-interest.

As I have said multiple times in the past, we really do need to redefine the term ‘criminal’.

Partly to prevent this shit from spreading and partly to correct this insanity from destroying civilization…if it isn’t already too late!

Let us proceed with our first article:

Honda Strike Becomes a Rallying Point in China
Joe Tan/Reuters

Security guards on Friday at a Honda manufacturing plant in Foshan, Guangdong Province, that was shut after a labor dispute at a parts facility.

Published: May 28, 2010

FOSHAN, CHINA — A strike at an auto-parts factory owned by Honda in southern China has unexpectedly become a cause célèbre in the nation’s struggle with income inequality, with Chinese media reporting extensively on the workers’ demands and calling on the government to do more to increase wages nationwide. [How will the Chinese government ‘deal’ with this well publicized worker uprising? The article even goes on to point out that this is not ‘new’ and usually it is ‘hushed up’ so the, er, ‘effected parties’ don’t suffer from a well-deserved ‘Black Eye’ in the marketplace. The fact that this story is even appearing in the US MSM tells us to anticipate price increases on Honda products (if you’re still stupid enough to buy them after reading this article!)]

Strikes have occurred before at Chinese-owned factories and on rare occasions at foreign-owned plants. But the authorities have typically hushed them up and either sought a quick deal or sent in the police. [Which of these two tactics do you think is most prevalent, considering the nature of the capitalists who, er, ‘escaped’ to China?]

The 1,900 workers at the Honda factory here have been on strike to demand higher pay since early last week, and on Friday there was no resolution in sight. The resulting shortage of transmissions and engine parts has forced Honda to halt production this week at all four of its assembly plants in China, with one closing on Monday and the other three on Wednesday.

The work stoppage is the clearest sign yet of growing labor unrest in a country that is now the cornerstone of many companies’ global supply chains.

Zheng Qiao, the associate director of the department of employment relations at the China Institute of Industrial Relations in Beijing, said that the strike was a significant development in China’s labor relations history because the workers appeared to be well organized and united. [We can only wonder how much of this ‘unity & organization’ can be attributed to their ‘communist indoctrination’?]

“The strike at Honda is the largest strike that has ever happened at a single global company in China,” he said, adding that, “such a large-scale, organized strike will force China’s labor union system to change, to adapt to the market economy.” [Do I need to ‘translate’ that for you good citizen? The ‘employers’ moved to China to escape unions, never mind environmental regulation. How much do you want to bet this dissolves into union busting that ‘re-ignites’ the currently latent ‘communist fervor’ of their forebearers? The resulting ‘bitch slap’ will be so richly deserved that it is a royal shame civilization won’t survive to witness it!]

Workers here have discovered the same weapon that the United Automobile Workers used to become the most powerful industrial union in the United States: shut down a crucial parts factory, and auto assembly plants across the country have to close. [This is the problem the predators have yet to crack: what do you do when the stooges wise up and say, “fuck you, I’m not gonna do it anymore?” Ultimately, it’s cheaper to pay them.]

“In terms of shutting down a multinational’s entire operations, I think this is the first” in China, said Geoffrey Crothall, the spokesman for China Labor Bulletin, a labor advocacy group based in Hong Kong.

The official English-language China Daily newspaper ran a lead editorial on Friday that cited the Honda strike as evidence that government inaction on wages may be fueling tensions between workers and employers. [Ya think?] The editorial criticized the Ministry of Human Resources and Social Security for not moving faster to draft a promised amendment to current wage regulations because of opposition from employers.[snip]

Ahem, this is PRECISELY what these mercenary motherfuckers moved to China to get away from!

Speaking for myself, I think it serves them right, fools who refuse to learn the mistakes of the past are doomed to repeat them!

Sadly, the short term result of this foolishness can be found in the article below:

Private pay shrinks to historic lows as gov't payouts rise

By Dennis Cauchon, USA TODAY
Paychecks from private business shrank to their smallest share of personal income in U.S. history during the first quarter of this year, a USA TODAY analysis of government data finds.

At the same time, government-provided benefits — from Social Security, unemployment insurance, food stamps and other programs — rose to a record high during the first three months of 2010. [Um, USA Today is a ‘true blue’ patriotic news organization that would NEVER even suggest capitalism was faltering, much less failing. So instead you’re being told that these numbers are a ‘statistical aberration’ caused by the ‘poor economy’ that is still in the ‘early stages’ of recovery…]

Those records reflect a long-term trend accelerated by the recession and the federal stimulus program to counteract the downturn. The result is a major shift in the source of personal income from private wages to government programs. [You have to be either extremely ‘optimistic’ or downright ‘deluded’ to not realize the massive shrinkage in our total payroll figures means there is nothing to support the ‘consumer economy’ globalization was to provide for us.]

The trend is not sustainable, says University of Michigan economist Donald Grimes. Reason: The federal government depends on private wages to generate income taxes to pay for its ever-more-expensive programs. Government-generated income is taxed at lower rates or not at all, he says. "This is really important," Grimes says.

The recession has erased 8 million private jobs. Even before the downturn, private wages were eroding because of the substitution of health and pension benefits for taxable salaries. [Yeah, having to devote increasing amounts of previously ‘disposable income’ towards future expenses resulted in putting a massive drag on consumer spending.]

The Bureau of Economic Analysis reports that individuals received income from all sources — wages, investments, food stamps, etc. — at a $12.2 trillion annual rate in the first quarter.

Key shifts in income this year:

• Private wages. A record-low 41.9% of the nation's personal income came from private wages and salaries in the first quarter, down from 44.6% when the recession began in December 2007. [Stop! What does this tell you? It tells me ‘capitalism’ doesn’t need all of the workers we have…in fact, it can’t use half of them…a fifty-percent ‘redundancy’ rate is unsustainable.

•Government benefits. Individuals got 17.9% of their income from government programs in the first quarter, up from 14.2% when the recession started. Programs for the elderly, the poor and the unemployed all grew in cost and importance. An additional 9.8% of personal income was paid as wages to government employees.

The shift in income shows that the federal government's stimulus efforts have been effective, says Paul Van de Water, an economist at the liberal Center on Budget and Policy Priorities.

"It's the system working as it should," Van de Water says. Government is stimulating growth and helping people in need, he says. As the economy recovers, private wages will rebound, he hopes says. [Um, that’s the ‘theory’ behind stimulus spending but there is nothing in our current economic environment to make that happen. There WON’T BE any ‘new, good paying jobs’ that come out of this disaster.]

Economist Veronique de Rugy of the free-market Mercatus Center at George Mason University says the riots in Greece over cutting benefits to close a huge budget deficit are a warning about unsustainable income programs.

Economist David Henderson of the conservative Hoover Institution says a shift from private wages to government benefits saps the economy of dynamism. "People are paid for being rather than for producing," he says.

Do you find it curious that USA TODAY felt compelled to close the article with not one but two conservative talking points? That damn ‘Liberal Media’ is everywhere!

So labor ‘unrest’ in China mixed with, er, ‘labor surpluses’ everywhere else. What do you suppose is wrong with this picture?

Is it time for capitalists everywhere to ‘pack up their tents and resume the search for the new ‘cheaper there’?

Of course it isn’t! It’s never really been about ‘labor costs.’ It is and has always been about ‘market share’. It drove the capitalists crazy that the world’s largest markets were dirt poor…and naturally, these pinheads failed to think through the ramifications of, er, ‘reversing’ that situation. Now they’ve done what comes ‘naturally’ and the piper is looking to be paid!

At the end of the day good citizen it would be nice to think everything is going to work out all right…but we all know there is little chance of THAT happening.

‘It would be nice’ if this resulted in a fairer, more equitable world instead of pretty much universal destruction…but hey, who knew?

I find myself in agreement once again with Ilargi and Stoneleigh…’who’s your friend’ is probably the most important issue to focus upon right now…the people fighting alongside you will hopefully out number the ones your fighting against.

Certain truths are immutable…

Thanks for letting me inside your head,


Wednesday, May 26, 2010

Hand Waving...

Greetings good citizen,

I’m ‘trying’ to tackle a lot of chores I’ve been putting off until better weather arrived and, naturally, they have expanded (or worse, ‘exploded’) beyond the time allotted to complete them.

Sadly, neglecting issues until they become ‘do or die’ comes at a price. Waiting to install new brake pads caused the tire to, er, ‘weld’ itself to the hub, requiring me to pound it free…which bent the rim. So now I have to deal with a slow leak that will cost me 75 cents a day until I can locate and have a replacement wheel installed.

Um, don’t even get me started on the freaking alternator, what a friggin horror show! Three bolts and a belt…who knew it would turn into a four day project!

But I digress…but not so much good citizen because the nation is ‘mirroring’ my personal woes. The longer our ‘so-called leaders’ keep twiddling their thumbs while the media continues to report meaningless hand waving rather than the important issues facing our civilization, nothing is being ‘fixed’, much less addressed.

So we encounter tonight’s offering where the media invokes the largely ‘imaginary’ recovery and blames Europe for its persistent ‘invisibility’.

The longer these things are ignored, the worse they’re going to become.

Europe Pain May Impede U.S. Upturn
Published: May 25, 2010

Only months after most economists forecast that the recession could be viewed safely through the rearview mirror, the European fiscal crisis poses an unsettling new challenge for the United States economy. [Same old same old, good citizen…how can the US economy be in ‘recovery’ if our supposed ‘customers’ are broke? Is someone lying their ass off here or are these people really that stupid…or worse, do they really think we are?]

Few economists predict the United States will pitch into another recession soon. [This is true since we haven’t really ‘recovered’ from the original one.] But a still weakened American economy could be slowed by its wounded European allies and trading partners. Even the optimists are wondering aloud if the United States will encounter a slower and bumpier recovery than expected. [What do you suppose this idiot means by this? How much slower and bumpier can ‘non-existent’ be? How deep does a ‘purely imaginary’ recovery go?]

“Look, a double-dip recession is a genuine risk — I’d place it at 20 percent as opposed to 5 percent a few weeks ago,” said Robert J. Barbera, chief economist for ITG, who has been notably bullish on the United States economy. “We have some chronic problems in Europe, but I don’t see it leading us to a Lehman-style contagion.

“At some point,” he added, “you revert to a focus on our fundamentals, and those are decidedly better than conventional wisdom has it.” [Um, what planet is he making this observation from because it sure as hell isn’t here! The global economy is so badly broken that we are faced with ‘emmenient’ worldwide social collapse.]

Perhaps so, but vertiginous drops in stock markets, belligerent rumbles from North Korea and an American economy throwing off mixed signals has economists treading carefully. Rarely have so many central banks taken such extraordinary steps to stave off banking and national collapses. Their wariness about what they have wrought is palpable. [‘Wary’? These fuckers KNOW they’re ‘tap dancing on a land mine’, is it really all that surprising they are paying extra close attention to public sentiment right now?]

James Bullard, president of the Federal Reserve Bank of St. Louis, traveled to London and assayed a noticeably careful defense of the global economy in a speech. He did not discount the risk of a financial contagion jumping the Atlantic, given the weakened state of global finances and the risky nature of the bailouts. Governments and central banks must strive to re-establish credibility, he said, even as markets shake and gyrate. “This new threat to global recovery will probably fall short of becoming a worldwide recessionary shock,” he said. [Um, no irony should be lost considering this is definitely a situation when ‘probably’ just isn’t good enough! It should also be noted that the only way to ‘restore confidence’ in government and banking is to tear them both down and replace them with far more ‘transparent’ institutions.]

There is no shortage of storm clouds to bolster a gloomier take. Japan and Europe are perched near the edge of deflation. And as one European leader after another takes a vow of austerity amid talk of layoffs and deep spending cuts, American manufacturers — which have led the domestic recovery — could find their goods piling up in warehouses and on docks. [Um, this is either an ‘isolated incident’ or an outright falsehood, the US manufacturing sector is easily small enough to be drown in a birdbath or a fairly shallow puddle, bathtub not required!]

“We were counting on a weak dollar and a strong European economy; instead we got a strong dollar and a weak Europe — that is clearly not good for our economy,” said Joseph E. Stiglitz, former chief economist of the World Bank and a professor of economics at Columbia University. “It certainly increases our likelihood of a double-dip recession.” [Pay attention to Joltin’ Joe’s words here because it won’t be too long before we’re all wondering why the ‘strong dollar’ won’t buy you a hat full of shit!]

As well, the rate set in London that banks charge each other for short-term loans, known as Libor, has marched steadily upward in recent weeks, reaching a 10-month high this week. Such loans act as the fiscal grease that lets banks lend freely. [To who? The only ‘qualified borrowers’ have been the Investment banks and they’re using the money to pump up the stock market!] Their rising cost slows lending — something Mr. Stiglitz says is a consequence of governments’ bailing out banks without forcing them to make a clean accounting of their losses and bad loans. [Um, pointing out the obvious does nothing to alter the outcome.]

“The credit markets’ reaction is sending a strong message that the banks don’t trust each other’s balance sheets,” Mr. Stiglitz said.

There are, too, lingering questions about the strength and sustainability of the American recovery — questions that loom as more important than ever given the weaknesses in Europe.

The American economy has picked up recently, with consumer spending jumping higher and debt falling sharply. Manufacturers, too, have put a collective toe back into the hiring market, and bankers are exhaling — even if they are not lending at their former levels.

Mr. Barbera speculates that the quirks of federal data collection have understated the strength of hiring. “All the measures of industrial production are better than expected,” he said. [What numbnuts isn’t saying is what passes for ‘industrial production’ these days has little to do with either ‘industry’ or ‘production’!]

But state governments, from California to New Jersey and New York, are readying draconian spending cuts, with forecasts of layoffs of hundreds of thousands of state workers. Residential housing inventories continue to grow and prices continue to soften. And large businesses have yet to begin hiring in considerable numbers; the ranks of long-term unemployed have swelled to a number not seen for decades. [Is this ‘magic or even ‘coincidence’ good citizen? NO! It represents our badly broken economy that won’t be fixed as long as it is more ‘advantageous’ to let it remain broken. But that ain’t gonna happen either!]

“This has to go down as one of the most fragile economic recoveries in recorded history,” said David Rosenberg, chief economist for Gluskin Sheff, an investment firm. “We’ve had jobless recoveries before, but this recovery has been totally devoid of income growth, and that’s very disturbing.” [Who else thinks Mr. Rosenberg is being ‘extremely charitable’? If you ‘deny’ that the economy is recovering, the pundits will point at the…stock market as proof they are right, even though it has long ago become obvious that the stock market has little to do with the state of the ‘real economy’.]

Salvation could come from unexpected corners. The United States, in the words of the St. Louis Fed chief, might be “an unwitting beneficiary of the crisis in Europe.” That is the lesson suggested by recent history. When the Asian economies shuddered and currencies nearly collapsed in 1998, many economists predicted the tremors would take down the United States and European economies. Quite the opposite occurred. [Um, the ‘safe haven’ effect does absolutely NOTHING for the ‘paycheck peasants’…which is where the trouble will originate.]

A stream of money flowed from Asian banks into United States Treasury bonds, and interest rates fell as a result. Oil prices also dropped. And the United States emerged stronger. [It is this kind of ‘blissful ignorance’ that created the current fiasco, the inability to recognize what is ‘good’ for investors is ‘bad’ for the nation is wholesale stupidity because investors make up less than one percent of the population…even less if we look at it globally!]

“Everyone competed to reduce their G.D.P. forecasts and it ended up being much stronger than forecast,” recalled Mr. Barbera. [Um, there is so much ‘wrong’ with this ‘blanket assertion’ that it isn’t even worth parsing…what would Mr. Barbera be measuring?]

There is suggestive evidence that this could happen again. American interest rates have fallen in recent days, as investors apparently seek refuge in Treasury bonds. And talk of a slowdown has caused the price of oil to fall, which helps the American consumer. [Um, it is ‘astounding’ that this evidence that the wheels are flying off is being interpreted as mere ‘turbulance’ in the economy, but this is what the media is trying to ‘distract us’ from examining too closely.]

A risk attends here, too. Pumping so much money into a nation can be like pumping adrenalin into a sick patient — it masks the underlying infection. It could be argued that the infusion of cash in 1998 further inflated the Internet stock bubble, which popped several years later with disastrous consequences. [Not nearly as disastrously as it would have been without the ‘pump and dump’ Real Estate scam following right on its heels!]

Mr. Bullard raised that warning obliquely in his speech Tuesday, suggesting that while the United States might draw temporary advantage from the European crisis, it must “directly address” its fiscal problems if it is to retain credibility with credit markets. After all, along with the countries of the euro zone, Britain and the United States are running outsize deficits, compounded by their spending to stimulate the economy.

The ability of American officials to pull this off while markets jump and twist poses a considerable challenge.

“A lot of our recovery was financed by government handouts, and the sustainability of that is open to question,” said Joshua Shapiro, chief United States economist for MFR Inc. “I see lots of fits and starts ahead.”

He said, She said…and it’s all self-serving bullshit! All of these opinions the media quotes (and they are ‘opinions’ make no mistake about that!) come from people whose job it is to sell stocks and other financial products…you don’t suppose they may be a little ‘blind’ to the true state of ‘economic activity worldwide?

The disaster in the Gulf is only going to exponentially expand the economic desert at the worst possible time.

Worse, instead of cleaning up the disaster, it will be left to ‘fester’ causing decades of financial ruin that the fucking irresponsible capitalists will use their control of the media to ‘ignore’.

The longer you let a situation go, the more it costs you later.

Just something to think about as the fucking political class tries to distract you with useless ‘hand waving’ over largely meaningless issues.

Makes you wonder, what the fuck is wrong with the media?

Short answer, nothing…it is doing what it is paid to do, and that’s a damn sin.

Thanks for letting me inside your head,


Monday, May 24, 2010

Business Friendly

Greetings good citizen,

I apologize for the quiet weekend but I had stuff to do and there are only so many hours in the day.

I could have posted last night but I joined in the ‘national obsession’ that was the ‘Lost’ phenomenon. I didn’t see much of the series nor was I ‘attracted’ to it because the only answer that made any sense was provided at the end of the series…they were all fucking dead!

There was ample evidence of this from the beginning and it must have tickled the producers to no end to have successfully pulled off such a ‘mind-fuck’.

Sort of says something about society we live in…and it’s not good.

Sadly good citizen, the truth, once again, trumps fiction.

Let’s have a look at tonight’s offering so we can examine what else is ‘wrong’ with this picture…

32 States Have Borrowed from the Federal Government to Make Unemployment Payments; California Has Borrowed $7 Billion has learned that 32 states have run out funds to make unemployment benefit payments and that the federal government has been supplying these states with funds so that they can make their payments to the unemployed. In some cases, states have borrowed billions. As of May 20, the total balance outstanding by 32 states (and the Virgin Islands) is $37.8 billion.

The state of California has borrowed $6.9 billion. Michigan has borrowed $3.9 billion, Illinois $2.2 billion.

Below is the full list of the 32 states (and the Virgin Islands) that have borrowed from the federal government to make unemployment payments, and the amounts that remain borrowed as of May 20 . (Numbers in red are billions)

Alabama $ 283 million
Arkansas 330 million
California 6.9 billion
Colorado 253 million
Connecticut 498 million
Delaware 12 million
Florida 1.6 billion
Georgia 416 million
Idaho 202 million
Illinois 2.2 billion
Indiana 1.7 billion
Kansas 88 million
Kentucky 795 million
Maryland 133 million
Mass. 387 million
Michigan 3.9 billion
Minnesota 477 million
Missouri 722 million
Nevada 397 million
New Jersey 1.7 billion
New York 3.2 billion
N.C. 2.1 billion
Ohio 2.3 billion
Penn. 3.0 billion
R.I. 225 million
S.C. 886 million
S.D. 24 million
Tennessee 21 million
Texas 1.0 billion
Vermont 33 million
Virginia 346 million
Virgin Islands 13 million
Wisconsin 1.4 billion
Total $37.8 billion

Okay good citizen, three quarters of the country is on the hook to the Federal government to support payments to the people ‘private enterprise’ tossed out the door (so THEY could remain ‘profitable’!)

What do you suppose is ‘wrong’ with THAT picture?

Worse, why have so many states exhausted their unemployment pools? Should we grill our ‘free marketers’ over that mystery?

I can’t speak for all of the, er, ‘troubled’ states listed here but the legislature in my state decided they needed to do more to make climate more ‘business friendly’ and chopping what employers were required to contribute to the unemployment pool was just one of the ‘tactics’ they used.

Who knew states would find themselves in the position of supporting such large numbers for such a long time? (Understand, this is the same as asking ‘who knew’ capitalism was going to fail?)

Capitalism only works under certain, er, extreme conditions. Capitalism DOESN’T WORK once productive capacity outgrows the labor pool, decimating the customer base.

Since it is rather obvious that capitalism doesn’t work, why isn’t capitalism abandoned? Because capitalism works very well for the few it works for. (And these are the same people that are telling you a better way doesn’t exist.)

Lately, and you have probably noticed this too, there has been a lot of, er, ‘speculation’ about how severe the ‘blowback’ from the ‘financial crisis’ will be.

I think this early, er, ‘testing of the water’ is intended to take some of the edge off of the giant’s rage. I also suspect this is an ‘exercise in futility’.

The fuckers are hoping against hope that it doesn’t come totally unraveled, that some semblance of control/authority tempers society’s outrage. They should have thought of that before they fucked us…it’s a little late now.

But, no matter, the ones who decided ahead of time they could escape the wrath of the crippled nation(s) they made knew there was no turning back. We can only wonder how many of them (stupidly) thought the ‘non-extradition’ policy of certain governments would protect them?

In that respect, the otherwise inexplicable, er, ‘resurrection’ of large scale (and perversely ‘private’) mercenary organizations becomes much clearer when viewed from the ‘personal protection’ perspective. The Bush years minted roughly a thousand brand spanking new billionaires…what do you think of that?

Understand that if it weren’t for ‘federal funding’ these ‘private security’ outfits would have no clients capable of paying for all the foreign troops they rely on.

You and I are ‘subsidizing’ the thief’s protection! Actually, this is little different from the ‘stated vs. real mission’ of the world’s police force. They SAY it is there to protect YOU but come crunch time, the police are really ‘tasked’ with protecting commerce, you come in a distant second! You pay for it but it isn’t there for you…it’s there for them!

When you sit down and think about it for a while, it just starts to mount up, doesn’t it? Everytime you turn around you find more evidence of the owners of commerce screwing over the workers.

So how bad do you think the ‘blowback’ is going to be? I think its going to make the French Revolution look like a kindergarten outing.

‘Off with their heads’ will be the least of it.

Thanks for letting me inside your head,


Thursday, May 20, 2010

Duck & Cover

Greetings good citizen,

Not only are we ‘going to hell in a bucket’ but I’m sure most of us aren’t ‘enjoying the ride’.

Although some have had one hell of a run, as evidenced by the ‘high end Repo men’ clip shown on this morning’s Today show. Some of the scum responsible for the collapse of the financial markets got their tails in a bind when it all fell apart…

I can only guess seeing the ‘repo men’ on TV is supposed to make us think that ‘justice’ is being done. That seeing these ‘bad boys’ having their ‘toys’ taken away from them makes it all even and now everything is all better!

When the reality is good citizen the repo men are visiting the ‘stooges’ who worked for the assholes who bankrupted the world. These ‘repossessions’ are being executed upon ‘the hired help’ (who have outlived their ‘usefulness’.)

But what did you expect, this is the MSM we’re talking about here! These guys are loaded with more baloney than a bargain cold cut platter!

Gulling the gullible is what they do! Good thing you’re too sophisticated to be sucked in by their ruses!

That said, we encounter tonight’s offering which you might also want to take with a rather largish dose of salt.

Sell Everything, You Won’t Recognize America By The End Of The Year

Richard Russell, the famous writer of the Dow Theory Letters, has a chilling line in today's note:

Do your friends a favor. Tell them to "batten down the hatches" because there's a HARD RAIN coming. Tell them to get out of debt and sell anything they can sell (and don't need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won't recognize the country. They'll retort, "How the dickens does Russell know -- who told him?" Tell them the stock market told him.

That's pretty intense! {Geez, why isn’t it ‘intense’ when I tell people to get out of the stock markets? (Probably because I don’t pen a mainstream ‘financial letter’ that provides investment advice!)]

Update: By popular demand, here's more on what he sees in the market. The gist is that the markets recent gyrations are telling him that the economy is in trouble:

And I ask myself, "Am I seeing things? The April 26 high for the Dow
was 11205.03. The Dow is selling as write at 10557 down 648 points
from its April high. If business is even better than expected, then
why is the Dow down over 600 points? And why, if there were 674 new
highs on the NYSE on April 26, were there only 20 new highs on Friday,
May 14? And if my PTI was 6133 on April 26, why is it down 17 points
since its April high?

The fact is that I've been seeing deterioration in the stock market
ever since early-April, and this in the face of improving business
news. The D-J Industrial Average is composed of 30 internationally
known top-quality blue-chip stocks. These are 30 of "America's biggest
companies." If Barron's is so bullish on the future of America's
biggest companies, then why isn't the Dow advancing to new highs?

Clearly something is wrong. But what could it be? Much as I love
Barron's, I trust the stock market more. If I read the stock market
correctly, it's telling me that there is a surprise ahead. And that
surprise will be a reversal to the downside for the economy, plus a
collection of other troubles ahead.

About Dow Theory -- First, we saw the recent April highs in the
Averages. Then we saw a plunge in both Averages to their May 7 lows --
Industrials to 10380.43, Transports to 4298.12, next a short rally. If
ahead, the two Averages turn down and violate their May 7 lows, that
would be the clincher. Such action would signal the certain resumption
of the primary bear market.

Just as for years I asked, cajoled, insisted, threatened, demanded,
that my subscribers buy gold, I am now insisting, demanding, begging
my subscribers to get OUT of stocks (including C and BYD, but not
including golds) and get into cash or gold (bullion if possible). If
the two Averages violate their May 7 lows, I see a major crash as the
outcome. Pul - leeze, get out of stocks now, and I don't give a damn
whether you have paper losses or paper profits!

Don't miss: 13 housing markets that will never recover

Only 13? The ‘economic desert’ is going to be a lot bigger than that, maybe Chumly couldn’t be bothered to report on the larger but less ‘significant’ portions of the wastelands.

But I digress…

The topic is ‘head for the hills, the stock market is melting down!’…which brings us to another, er, disturbing ‘misconception’. That the economy will ‘collapse’ if the stock market ‘flatlines’.

You may want to conduct this ‘thought experiment’ for yourself. Ask your more erudite acquaintances if they believe the economy would ‘cease to function’ if the stock market collapsed.

It didn’t happen in 1929 nor did it happen in 2008 after the ‘real economy’ had shrunk down to a fraction of what it was in 1929. You’ll probably be taken back a couple of steps by either your supposedly ‘smart’ friends ignorance (Those who answer ‘I don’t know’) or their agreement with such a false notion.

A false notion that exists because most people have no clue what the stock markets actually do. There is a few nautical miles difference between the ‘stated’ purpose of Wall Street and its true purpose.

The reason for this has to do with the, er, ‘scumminess’ surrounding why Wall Street exists. If the general public knew the real purpose of Wall Street, they’d never risk so much as a cent there.

Just to qualify here a little, ‘could’ a market meltdown ‘fuck up’ the financial markets? It sure as hell could, AND THAT ‘might’ stop most commerce in its tracks (resulting in that much feared ‘supply line’ meltdown.)

Always remember the law of the land…‘fuck you, pay me!’

Mind you, this is not completely rational; our system of commerce wasn’t created by ‘rational people’, it was created by a bunch of fucking greed heads!

Why does Wall Street exist? Because if they had ‘outlawed’ what we politely called ‘risk capital’ that Wall Street supposedly provides, the ‘greed heads’ who set up the capitalist system would have been unable to ‘extort’ a portion of the commercial capacity of the nation for themselves.

‘Risk capital’ is these bastards justification for juicing the nation for their own personal benefit…it’s legalized theft. Ever wonder why stock prices have no basis in reality? There’s your answer.

‘We’ don’t ‘need’ a stock market…the people who have claimed ownership of the nation do.

How unfortunate is it for the rest of us that we live in a land where only a handful of people have access to the ‘lifeblood’ of the nation?

And through their ‘manipulation’ of currency, we the workers regularly get fucked!

There is no such thing as a rich person who ‘earned’ their pile…most of them inherited what they’ve got, it was their forebearers who ‘stole it’ for them.

Until we stop ‘rewarding’ this kind of criminal behavior we will be stuck with an inoperative justice system that preys upon the innocent and resists being ‘cleansed’.

Bizarrely, this abject failure of the Justice system is what will make this nation ‘unrecognizable’ come the end of the year. Worse, we’re already part way there, with a ‘fail-safe’ financial sector supported with public money. (largely because the ‘Vampire Squid’ ‘spawned’…]

The longer the ‘Heads I win and Tails you lose’ game goes on, the stranger things are going to become…until somebody grows a nut and says ‘no more!’

Thanks for letting me inside your head,


Wednesday, May 19, 2010

Where she stops, nobody knows!

Greetings good citizen,

You may have seen the pundits crowing over the ‘surge’ in retail sales while your own frugal buying habits haven’t changed significantly. Allow me to remind you that during the ‘boom years’ between 2005 and 2008, the top 20% of earners were responsible for 80% of the spending.

As one might expect, closer examination of precisely who is reporting increased sales revenue reveals that those who aren’t ‘suffering’ like the rest of us are once again ‘disproportionately represented’.

Which is to point out that the ‘bulk’ of the uptick comes from retailers that cater to the wealthy.

Is this a sign of ‘economic recovery’ or is this another ‘let them eat cake’ moment?

Truth be told good citizen, it’s neither.

What we have here are political operatives positively desperate for some economic good news, because there isn’t any…because nothing has changed.

What has all of this hand waving over the collapsing banking sector been hiding good citizen? What has this smoke screen been distracting you from? It has diverted your attention from the fact that globalization has made the nation 'economically unviable'. The fucking capitalists ‘exported’ our tax base while importing our GDP…it all looked good on paper until it didn’t.

So good citizen we continue to see Bullshit like this being passed off as ‘proof positive’ that the economic desert is in ‘full bloom’.

Which brings us full circle to the same damn issue…what the hell are YOU going to do about it?

Which yields the same answer, ‘nothing’. Legally, there is nothing you can do…because the fuckers decide what is and isn’t ‘legal’. Worse, if they’re the ‘fuckers’, that makes YOU the ‘fuckee’…

Consumer spending trend is a shaky foundation for economic recovery

Analysts say the upswing in buying is largely by affluent people snapping up luxury items and delinquent homeowners who have extra money since they aren't making their mortgage payments.

The surge in spending by upper-income Americans could be seen in the upturned sales of Neiman Marcus, Mercedes, Morton's restaurant and other companies catering to the affluent.

By Don Lee, Los Angeles Times, May 16, 2010 | 7:33 p.m.

Increased consumer spending has fueled false hopes that the current economic recovery will keep getting stronger, but behind the encouraging numbers is a little-noticed reality: Much of the new spending has come not from America's broad middle class but from a small slice of affluent people at the top. [A.K.A. the already fucking rich!]

And upper-crust spending, while welcome, can be worrisomely volatile: Since it involves luxuries, not everyday necessities, the buying can suddenly shrink if something such as the recent stock market plunge panics affluent shoppers. [Bizarrely, these assholes ‘stay rich’ by not spending ‘the principal’ the millions they blow are all ‘juice’ (largely imaginary.)]

What's more, some analysts calculate that another big chunk of the recent spending spurt has come from an even shakier source — delinquent homeowners who have more cash in their pockets because they've stopped making mortgage payments now that their houses are worth less than the loan amounts. [Not addressed here is the ‘two-edged sword’ this represents. Most of these properties will never sell for more than what is owed on them due to a ‘permanent’ dearth of ‘qualified buyers’. This is going to fuck up the retirement plans of a huge segment of the population…and it is not just the Boomers that will be affected.]

Economists' uneasiness over building a recovery on such uncertain foundations is all the greater because the larger fundamentals are also shadowed by uncertainty. [Like how the hell does anyone survive in a society of three hundred million that can only support ten million?]

The improving job market should broaden the base of consumer spending, but wages are not expected to go up fast, which will crimp middle-class spending power. [So it goes without saying that the largely non unionized ‘working class’ is totally screwed!]

Moreover, the job gains this year have gone largely to less-educated and lower-income workers, according to Labor Department statistics. [If you owe hundreds of thousands on your college degree, tough. It’s not the school’s problem; it’s yours! Don’t forget the ‘law of the land’, “Fuck You, Pay Me!”]

"The economy can grow if lower-income households aren't able to spend, but it can't flourish," said Mark Zandi, chief economist at Moody's [Like the apparent ‘confusion’ surrounding the term ‘bonus’, it appears financial types are also unable to distinguish between ‘growth’ and ‘parking’ (hiring workers for sustenance or sub-sustenance wages) which is how we got in this fuckaree in the first place!]

The recent acceleration of spending "was a little bit of release of pent-up demand," said Ken Goldstein, an economist at the Conference Board, a New York research group that tracks consumer activity. [Proving that asshole wouldn’t recognize ‘pent-up demand’ if it bit him on the ass!]

"We survived the recession, we deserve a night out," Goldstein said of the mood of many spenders. Without much more job growth and bigger incomes, he said, "that window will close fast." [It is incredible how these fools consistently fail to acknowledge that this is NOT a recovery nor is it ‘sustainable’.]

The surge in spending by upper-income Americans could be seen in the upturned sales of high-end cars, clothing and luxury services. Nieman Marcus, Mercedes and Morton's restaurant, among other companies catering to the affluent, have prospered accordingly. [This might be the ‘one last time before the peasants burn the place to the ground’ sort of ‘consumption’…]

Since December, sales at luxury chains have outpaced those at department stores and discounters, helping boost overall consumer spending by a surprisingly robust 3.6% in the first quarter, according to data from the International Council of Shopping Centers.

But an economy that has become more dependent on the well-to-do is an economy at the mercy of volatile financial markets. [In an economy that produces nothing, these fuckers are ‘tap dancing on a land mine!’]

The irrationally soaring stock market last year boosted the spirits of high-income consumers and helped open their wallets. [Sure, it is ‘free’ money!] Wall Street's latest plunge and the continuing fear of a financial meltdown in Europe can just as quickly send them running for cover.

Penny Gilbert, 44, of Sherman Oaks said that what happens in Europe and in the stock market over the next few weeks would determine whether she and her family vacation in Hawaii this summer or take a trip closer to home, such as to the Grand Canyon.

"I'm very leery about the future," she said. "That was scary last week when it dropped 1,000 points for no reason," referring to the brief plunge May 6 in the Dow amid rapid-fire electronic trading and widening financial turmoil in Greece.

Last summer the Gilberts, who have two children in private school, [Just your ‘typical’ Americans…right!] were afraid to go anywhere and spend money, she said. Gilbert works part time as a research consultant. Her husband is a lawyer. "We stay-cationed," she said.

Now, having recouped some of their stock losses and with home prices in their community stabilizing, Gilbert is getting ready to plow as much as $20,000 into repainting their house and buying a new air conditioning and heating system. [Okay, how big is their house? $20 g’s for a paintjob, even if that includes ‘new’ HVAC, is pretty damn stiff unless you’re living in a ‘mansion’.]

"I haven't seen any more foreclosures in our area," she said.

In American Express' monthly "Spending & Saving Tracker" survey, 70% of homeowners with incomes of $100,000 or more said in April that they were planning home improvements this year, spending an average of $11,500. That's about double the amount lower-income homeowners plan to spend. [Again, the point here is the ‘new normal’ doesn’t include ‘everyone’ and those it doesn’t include will literally be going A.) hungry and B.) caveman on the civilization that dares to ‘lock them out’.]

In fact, Labor Department surveys show that the top 20% of U.S. households in income account for about 40% of all spending. [Ya think that number has any basis in fact or that it hasn’t been ‘massaged’ down from a much higher figure?]

In recent months, the wealthiest Americans have apparently been driving an even more disproportionate share of consumption. [And contrary to what these ‘wealthiest American’s may think, one percent of the population is not ‘the whole economy’…you ignore the other 99% at your own peril!]

According to estimates from, they've also contributed an outsized share of the corresponding decline in saving, which has worried some analysts and policymakers. After rising to about 5% in the second quarter of last year, the personal savings rate fell below 3% this spring. [Paying down your credit cards is NOT saving…this is just more bullshit from those who make their living fucking around with money (at your expense!)]

Economists said it's common for affluent consumers to lead the spending in a recovery, but it's crucial that greater prosperity spread to the rest of the population.

Zandi thinks the underwater mortgage factor may also have juiced up consumption in the first quarter: Millions of homeowners are choosing to default on their mortgages or aren't otherwise making their monthly housing payments — and that's freed up billions of dollars in cash for consumers. [Um, under the ‘Fuck You, Pay Me Flag, this is going to cause some severe ‘civil unrest’ in the not too distant future…makes us wonder if the MSM will ‘embargo’ such news items?]

U.S. Housing and Urban Development Secretary Shaun Donovan said that's hard to know, but he estimated that only 10% of delinquent homeowners who have the ability to pay are opting not to do so. [Um, that doesn’t bode well for the 90% who DON’T have the ability to pay and are unlikely to ever, er, ‘recover’ that ability, if they ever had it in the first place…]

Still, that translates into hundreds of thousands of families. And with monthly payments averaging roughly $1,500, said's Scott Hoyt, a good portion is probably being spent. [Truly, life goes on and these people have no illusions, they are simply making the best of a bad situation, while it lasts.]

Overall, consumer confidence among the general population remains historically low, according to various surveys, though it has ticked up recently. [How much do you want to bet that ‘uptick’ was ‘politically motivated’?]

Shawn DuBravac, chief economist for the Consumer Electronics Assn., sees some encouraging signs. In addition to a pickup in affluent consumers who are buying once-deferred home theater systems for as much as $150,000, [More ‘typical American’s’…right!] stores are reporting that more shoppers are making bigger purchases in their visits, he said. "We see a higher selling price in 2010." [Does this mean consumers are buying batteries AND light bulbs?]

But DuBravac also remains wary. He said recent data indicated that 18% of personal incomes are from unemployment benefits and other government payments, such as social security. [More ‘massaged’ data, the true number is much closer to 50% but they don’t want you to know that…]

"We've seen spending increases, but it's come at costs in savings as opposed to real income increases," he said. "What we want to see is broad-based income growth, and not just a recovery in wealth." [Until these fuckwits put the brakes on globalization, that ‘recovery’ ain’t gonna happen! Your workers are, by necessity, also your customers! To even THINK otherwise is to risk revolution! Which is to point out that the interests of commerce and the interests of society are seldom ‘perfectly aligned’, this is why governments exist.]

Mike Grossman, who lives in the Dallas area, exemplifies the employment challenges facing many consumers — and the recovering economy.

This year, he spent about $6,000 for tools and supplies to landscape his home. But in March his software firm was sold to another company and his treasurer's job vanished. [Curious thing that, to be a company officer without having an ‘equity stake’ that would have allowed him to see this coming! Perhaps all is not ‘as represented’ here?]

Grossman, 45, has been looking for work ever since. "There's just more competition out there," said the single father of 13-year-old twin boys. [Um, don’t look now but Mr. Grossman is ‘doomed’…he’s too old and too ‘needy’. They can hire a kid fresh out of school for half of what Mr. Grossman is seeking and the kid will think he hit the jackpot instead of being ‘ill used’ as Mr. Grossman might regard such an offer. His best bet is to use his separation pay to ‘buy in’ to another ‘start-up’.]

And until he lands a job, Grossman said, he won't be doing much spending.

Even articles that slam capitalists for their shameless data manipulation still fall far short of openly crying foul when that manipulation is revealed.

This is the ‘world we live in’ and it is disturbing to see it has suddenly shrunk, so that all of us are no longer…there is no way to candy coat this, useful.

I saw an ad yesterday for ‘inafj’ which stands for ‘I need a freaking job’. It’s a You Tube video of a bunch of kids, stating the obvious…they need jobs…because without jobs their lives are ‘on hold’.

Left to your imagination is how these youngsters are going to take the news that ‘pull yourself up by your bootstraps’ capitalism has no use for them? Worse, this is where ‘capitalist utopia’ really falls on its selfish face, think there wasn’t enough ‘market share’ before, it’s really pathetic now!

The ‘crux’ of this whole ‘financial crisis’ is a ‘dearth of paying customers’. The rapidly disappearing ‘working class’ hasn’t seen a raise in three decades and can no longer afford to live on the pittance they receive from the predatory capitalists.

Soon we will see how ‘good’ it is to be ‘king’…when the kingdom is burning.

But don’t take my word for it, you’ll see for yourself soon enough.

Thanks for letting me inside your head,


Tuesday, May 18, 2010

Theater of the mind...

Greetings good citizen,

Um, after a 'surprise' rally yesterday at the end of the trading day and a fairly robust open this morning, stocks are heading back into the basement as Wall Street Firms turn misplaced investor confidence into personal profit.

Seriously good citizen, after what happened last week, where markets dropped AND RECOVERED almost a thousand points in under an hour, you KNOW it's all 'window dressing'. It doesn't have anything to do with anything...except how rich the already wealthy 'think' they are!

In this respect, tonight's offering meshes perfectly with the 'theme' of Joe Bagent's article.

It's all a 'fantasy' folks...actually, it's more like a nightmare for most of us. Those of not 'made of money' keep seeing our expenses rise while our paychecks buy steadily less.

And there isn't a damn thing we can do about it!

Were Living in a Theater State -- Plug in and Be Lit up by the American Hologram

TV and movies keep us in an entertained stupor, awed, mislead, and most importantly, distracted.

May 16, 2010

Ajijic, Mexico -- I've spent most of this week watching American television and movies. I leave the TV on all night long. I toss and turn with my bad back, and bad lungs, catch a rerun episode of Two and a Half Men, or CSI, and conk out again. Then I awaken to the U.S. morning talk shows. It's a grueling regimen, only for the strong. Or the lonely. For periodic relief, I switch to Mexican television (be patient, I really am going somewhere with this). Mexican TV is not one iota better than US television, but is veeerrry heavy on the booty. More than heavy. Astronomical. Think all-but-bare tits and ass close-ups every fifteen seconds, straight through commercials, dramas, comedy shows, history shows, and even the news where possible. Every show but the bullfights and that old nun who comes on at ten PM, who invariably drives me back to the U.S. channels.

Ahhhh … Safely in the American national illusion, where all the world's a shopping expedition. Or a terrorist threat. No matter, as long as it is colorful and wiggles on the theater state's 400 million screens. Plug in and be lit up by the American Hologram.

This great loom of media images, and images of images, is so many layers deep that it has replaced reality. No one can remember the original imprint. If there was one. The hologram is a hermetic snow globe, a self-referential circuitry of images, and a Möbius loop from which there is no logical escape. Logic has zilch to do with what is going on. The smallest part holographically recapitulates the whole, and vice versa. No thinking required, we just cycle and recycle through an aural dimension. Not all that bad, I guess, if it were not generated by forces out to fuck every last pair of eyeballs and mind plugged into it.

The investing class has put thousands of billions into movies, TV and other media to keep the hologram lit up over the past six decades. Which is to say, keep the public in an entertained stupor, awed, mislead, and most importantly, distracted. But the payoff probably runs in the trillions.

For the clear-eyed citizen, there is a growing inner horror and despair in all this, with nowhere to turn but the Internet. The Net is a cyber reality, no more real than the hologram, and indeed a part of the hologram, though not quite yet absorbed and co-opted by capitalism. We take what relief we can find.

However, for the unquestioning rest, the hologram, taken in its entirety, constitutes the American collective consciousness. Awareness. It enshrouds every citizen, defining through its permeation the daily world in which we all operate. Whether we love or hate it, there is no escape. Go live in a shack in the woods. Call that escape. But everything in the outside world continues to run in accordance with the humming energy of the hologram. There is no cutting our umbilical link to the womb of this illusion, this mass hallucination. There is only getting a longer umbilical cord, closing your eyes, and pretending that what the rest of the nation does has no effect on you. We were all born and raised in that womb. We can no more divorce the neurochemistry and consciousness it shaped in us, than we can deny that we had an earthly mother and are of her tissue. Our consciousness is born of the hologram's connective neural and electrical tissue.

That common womb of American consciousness is dying. Slowly or rapidly, depending on how you assess the global ecocide and peak everything, it is dying. There will be resuscitations along the way, more massive infusions of money, fear and the rawest sort of fantasy fed to a mood and commodity drugged public. Still, its condition is terminal, because the hyperdrive consumer culture it was built to sustain, is itself unsustainable. Its appetite ate the world. In fact, so voracious is its appetite that even if our "consumer economy," (legalized feudal theft) sees a recovery, and resumes the level of growth required just to keep capitalism alive, it will die just that much faster. It is not in capitalism's DNA to care about the death of the earth. Nor is it in the brain chemistry of an American satiated on prime beef and sailing across the landscape at 70 miles per hour in a $40,000, steel exoskeleton from General Motors, to care. Hominid gratification is what it is -- hard wired -- and there is no circumventing it.

The system has just begun its crash, and already we are seeing an armed infantilized nation wail, hurl blame and do horrific things, the worst of which we do to one another (excluding sending predator drones after Middle Eastern school kids). Surveillance, witch hunts, destruction of civil liberties, and the government inching toward star chamber trials for those who do not display correct traits. Citizens embracing totalitarianism as stability in the face of the ultimate instability -- the death of the planet.

The political regime or philosophy does not exist which can turn this scenario around. Slow it down, maybe, but put things in reverse, nope. Not when six billion mouths are munching at one end of the last noodle, and at the other end a fraction of a billion well armed technological people want the entire noodle. Not when life is already so damned cheap you can buy a girl slave in Haiti for twelve bucks, or 50 child slaves for your Asian sweatshop for less than the cost of a new car. Or an American working man for half of what it takes to support a family, then throw his ass over the company fence when he's no longer needed. Or bury him in mines as he cries out in Jesus' name, blow him up in Iraq, and Stelazine his kids minds and souls under the hot lights of the hologram, readying them for "the labor market." Schenectady or Soweto, life is dirt-cheap and getting cheaper everywhere on the planet.

Meanwhile, gangster capitalism needs that hologram to maintain the illusion that life is not cheap, and that Jennifer Anniston's ass can be yours in mind and dream (Personally, I'm a Julianna Margulies fan -- The Good Wife".) And most of all, "The Gram" is required to keep its captives deluded and sated enough to remain productive and consuming -- not to mention hating the right people -- right up to the last moment before total collapse, and they are no longer needed. The higher owning/investing class is safe, no matter what happens. Oh sure, as Edward Bellamy wrote, a few of them topple from their high perch on humanity's coach during the hell bent journey, but their class remains.

What happens to the rest of us in that great, sweating, moaning throng who have drawn the coach these centuries? What will remain for us on ruined plains of collapse?

Here is what I believe will remain. Reality and the truth, and the opportunity for spiritual evolution, which, in the end, I think will include most people. And much suffering. The reality of the world has always involved suffering. Despite the ballyhoo of modern science and technology, just as much suffering remains, more actually, given our increased numbers on the planet. Suffering happens to individual human beings and there are far more of those now. Of course, fat cat NGOs and governments deal in percentages and rates, so they will not have to account for the increased millions of miserable beings. We have more humans suffering -- and not just from poverty either, think of depleted uranium, toxic waste, sweatshop slavery -- than we had humans on earth a couple hundred years ago.

The hologram has, and still does, prevent Americans from grasping any of this. Instead, the hologram allows us to believe that life can exist without suffering. We actually achieved that state for a while, too, by forcing the suffering on unseen people elsewhere. We accepted the hologram's one voice to the many as truth (not that we had much choice, The ‘Gram was all we knew), then let our souls and national character necrotize in the warm bath of self-gratification and statist hubris. [That's a little 'harsh', most of us didn't ask and even fewer were aware this was going down. This only amplifies the crimes committed in our name without our knowledge (or consent.)]

Nasty picture ain't it? One surely painted by a bitter, sick old man who hates America. Years ago, my fellow countrymen used to ask if I hated America. They finally quit asking me when I started answering, "Hell fucking yes!" But I don't hate Americans. In fact, while I do not believe in "hope" -- that superstitious, childish wishing upon a star -- I do believe America is once again, for all the wrong reasons, the last best hope of the world. If we do not succeed in destroying it first.

Clearly, we have taken an unimaginably disastrous course, and intend to take everyone else out with us. Yet we have only done what most of the world's nations would have done, given such brute power and wealth for such a time. Perhaps more accurately, done what most of the world's governments and leadership would have. So long as nations have hierarchical leadership, they will have escalating hierarchical greed, power hunger and destructive folly -- and therefore, eventually approach hierarchical evil at some point. It may be an old saw, but power does corrupt.

Study us. See how an essentially good people (although the Native Americans would never agree) went wrong. After all, we were born the same unblemished child as everywhere else on the planet. And even now, given what has happened, one cannot fully indict all the "little people," past or present. My granddad was a decent guy until the day he died. So were my dad and mom. And I try to be. But all of us can be rendered blind by faceless machines not entirely of our own creation, and then made submissive beasts to the coarsest among us. Ask any German. Or Hutu. We can be manipulated to believe that the rules do not apply to us, as in the cult of American exceptionalism. Arrogance is experiential and environmental in cause. I've been there and back several times in my life, and I am sure of that. Human experience can make and unmake arrogance. Ours is about to get unmade.

Inside most Americans is a globally bratish child. Thanks to our endowed natural resources (since squandered) and to armed national theft abroad, the American has not suffered enough to become a responsible adult on the planet. I suggest that others learn from our example and do differently while they still have the chance. Take heart that they may yet live in a country where capitalism's nihilistic dynamo has not built up such a head of steam. There are still some left, but as near as I can tell -- and mind you, I don't know shit -- their leadership is caught up in the same elite games and traps. National leadership is its own moral and spiritual trap.

Who am I to give advice? Nobody. But this is the Internet, and any dick brain with a keyboard may do so.

My advice is to resist pride in anything said to be national, whether it be prosperity, healthcare, culture, competence, social cohesion and identity, or whatever. Pride and courage do not live in the same house. Courage, which has little to do with blood and guts, but everything to do with sacrifice, chooses to dwell alongside humility.

Again, what will be left after the big collapse? Perhaps after a period of terror, violence and chaos, when the undeniable on-the-ground truth becomes apparent, through ecological disaster, war and other events, a more positive national cathexis will occur. If it does, it probably will not resemble anything we can conceive of in these times. If we can get past the terror involved from our present apprehensive vantage point, it is easy to see why positive national, even global cathexis may be unavoidable.

Cause for well-reasoned optimism exists. Its way the fuck out there, but it's there. Not that it is something to cling to, or even pursue. Clinging and desire are the cause of all suffering in the first place. Doing so only prolongs suffering, personal, national or planetary. The Buddhists are right about that one. So are the Baptists when they say "The world gets right when the people get right."

The big problem at the moment though, for us as sentient beings, is:

What to do when I get out of bed each day? Give money to the Democrats? Move out of the country? Stay and fight the bastards?

Throwing money at frauds and fools doesn't work. Moving to Mexico or Canada takes money in a time when money and jobs are scarce everywhere. As for staying and fighting, really fighting, there is not one person reading this who is going to go strangle the sleazy fucks having martinis on Wall Street with their pet Senator. Nobody reading this is going to instill genuine physical fear, which is the only thing such lizards might respond to. We are left to work within the system, as per the hologram's directive. Their system. Ha!

The answer, to me at least, is to do the most obvious thing first. And I do mean obvious in the most mundane sense. Like fixing breakfast with all the contemplative awareness possible. Seriously. The tiniest right action, the action in complete unselfconscious-conscious natural awareness, connects to all the rightness in the universe. And the universe is always right. Because it owns all of our asses, plus black holes, and those teensy pinholes in time that physicist say make you an immediate neighbor of Shakespeare and mastodons -- only you don't know it. It owns the molecules of the ages. Everything.

This proposition is unappealing to Americans and just about everyone else in the western world. To be perfectly honest, a big screen TV, the Internet, and tickets to a Rams game are more accessible and immediately gratifying. Right action in the moment does not light up your neural pleasure centers like cheap sex or jalapeño Doritos. However, I am trying to do it anyway, at least until the opportunity for cheap sex presents itself. When it does, it will most likely be the right action for that moment. Funny how things work.

In any case, by the mundane right action of breakfast, I mean fixing breakfast to locate one's heart in that particular day. Then proceeding toward the least harm one can discern to do, with full knowledge that we always do harm, whether we intend to or not (the world is full of subtle unintended violence). Eliminate whatever suffering in sentient beings one encounters, whether it be in bums, dogs, kids, plants, or the rich fucker next door moaning over his enormous tax bill. To him that is suffering. There's no sliding scale about this shit. I once worked for a guy who bawled when some kid keyed his Porsche. Misery is relative. Compassion is sublime.
Besides, this is what the heart is designed for -- to serve as a compass for the spirit, regardless of how one defines spirit or denies its existence. What the hell, we gotta call the best in ourselves and in our species something, so we can connect with it. The mind has some terrible limitations in doing that sort of thing. As in, it cannot. Necessary as rationalization is for survival, reason ain't everything. In the big picture, it is a small ingredient. Merely an asset, a monkey tool.

Even thinking seems ultimately to lead to the value of non-thinking, which is to say, pure human existence and consciousness. Pure unadulterated duration. This is the most fearless plain, the one on which all things are manifest as they really are, in their purest form, before social and personal hallucinations settle over them like a shroud.

In such times as these, that hard bright plain is bitch to find, much less travel. For sure it starts with the moment called now.

And right now, good god, it's two AM! Time for the nightly Law and Order rerun on Mexican TV.

Hologram take me home.

Um, I have a somewhat darker vision of how this will all play out. If civilization collapses and Justice can't be restored, the likelihood that we will continue to resurrect and replay the same losing ideologies over and over until nature forces us change...or we render ourselves extinct are...assured.

Nowhere do you we see a break with past (lunatic) beliefs, except 'A Simple plan', which is 'holistic' to set civilization on a 'sustainable' path.

If the path is not sustainable for all of us, it will not be sustainable for any of us.

Thanks for letting me inside your head,


Monday, May 17, 2010

Jungle Drums

Greetings good citizen,

As the markets continue to tank, the jungle drums in the ‘doom-o-sphere’ continue to pound out the warning for all who wish to hear…

Then there are the rest of…er, ‘them’. They think everything is fine and we’re almost over the ‘speed bump’ they think this financial crisis was.

Um, not by a friggin long shot Bucko! If things ever do return to ‘normal’ it won’t be anything that most of us recognize!

The ‘new normal’ will come with disturbing features we didn’t think could happen here…like roadblocks where soldiers check your identification and search your vehicle. Heaven help you if you have a ‘weapon’ on you, in the vehicle or on the person of one of your passengers…you’ll be lucky to survive the encounter!

And the owner of the vehicle/weapon ‘WILL’ be, er, ‘rendered’ to an ‘undisclosed location’ to be ‘interrogated’ (because only ‘terrorists’ would have a reason to be armed…)

Can’t be too careful in these, er, ‘difficult’ times…

I keep looking for it but nowhere do I see anyone besides myself reaching the conclusion that the ‘end game’ of all of this ‘fiscal recklessness’ is to greatly diminish the, er, ‘surplus population.’

Does that make me wrong? Too soon to tell.

So we arrive at tonight’s offering for another ‘dismissal’ of ‘conspiracy theory’.

Oil, credit and the velocity of money (revisited)

Ilargi: One more time (could this be the last?) [Doubt it] we delve into the notion that energy, and oil in particular, might have caused the financial crisis. [Not directly, but it’s a big part of the puzzle!] We've done this more times at The Automatic Earth than we should have already, if you ask me, but Stoneleigh, who has far more patience than I do, has this Q and A with a TAE reader. My view: oil and oil prices as a causative agent for the credit crunch remains a non-starter for all but the peak oil religious fanatics.

The most obvious issue to address in the reader’s statements below is the idea that if we had $20 oil today, there would be no financial crisis. I don’t think I even see the possible relevance here. For example, one of the main and most obvious symbols of this crisis so far has been Bernie Madoff. He's not Lehman, AIG or Goldman Sachs, and he's not the government of Greece, or Britain, or America, but his spiel, his schtick and his scheme are the exact same. The key word is Ponzi. Not oil.

But no, neither Madoff, nor AIG, nor Goldman nor any of the governments did what they did because of oil, or oil prices. [Oh yeah?] All these schemes started out when oil was still dirt cheap, and it never factored in. [This ‘confuses’ price with the value of money, when neither are a genuine factor. It’s all about ‘supply and demand’, reduce demand and you’ll proportionally increase supply!] Really, hard as it is to fathom or accept, the financial crisis has fed simply and only off itself, though non-existent regulation and the ensuing opportunity for endless greed. It never needed anything else. Ponzi schemes are like those secret service messages: self-destructing. [What ‘Dodo’ is missing is the real ‘by-product’ of globalization, a massive increase in what would become the ‘surplus population’.]

Which is not to say that oil couldn't bankrupt BP, but that's a whole other story. Here's Stoneleigh:

Stoneleigh: Let me try to resolve the apparent contradictions by answering some questions from a TAE reader:

Q: In 1933 there was a shortage of everything. Commerce had been dead for enough years - killed by gold- buggery - that there was shortages except for crops that were rotting in the fields (and petroleum that was wasted, according to Jeffrey Brown, who I believe.) No money meant no production = shortages = no commerce = no new money in the system in a self- reinforcing cycle. Citizens hoarded paper dollars as they had hoarded specie. Paper dollars were still worth more than (pauperish) 1930's commerce.

Stoneleigh: Exactly. The lack of money led to shortages because without it one could not connect buyers with sellers, so production died. But not for want of raw materials. Farmers threw milk they couldn't sell in ditches while down the road people were starving. That is what I have been saying will happen again. [This, bizarrely, led to ‘Friedmanism’ and the twisted belief that money was the solution to all social problems, a theory that has since been proven wrong. Today we are literally ‘swimming’ in cash/cash equivalents and poverty is up 20% (because the cash went where it always goes, into the hands of those who need it least!) How’s your ‘theory’ holding up now?]

Money is the lubricant in the economic engine. Trying to run an economy without it is like trying to drive your car with the oil light on. The vast majority of the effective money supply consists of credit, and deleveraging will take care of that. As for the small amount of money left, people will be hanging on to it with both hands because they won't know when they'll be able to earn any more. [Um, once again we see an astounding ‘ignorance’ of what money is and how it works! Only an idiot will ‘hold on’ to a rapidly depreciating ‘fiat dollar’. The trick is to spend it as fast as you can, while you can still get something for it! The ‘evaporation’ of credit has much darker portents…the ‘fiscal strangulation’ it brings isn’t ‘accidental’ or even ‘unintentional’. understand, this is the ‘owners of commerce’ sticking it to you! You’ll be forced to pay dearly for that which you can’t produce yourself!]

The fall in the velocity of money will aggravate credit collapse dreadfully. The result will be an unbelievably severe liquidity crunch, worse than the 1930s because the scale of the hangover is proportionate to the scale of the party that preceded it. [Nor will this, er, ‘credit crunch’ be an ‘accident’, this is the planned outcome and the troops will already be in the streets (supposedly looking for ‘terrorists’) when it happens!]

For a while it will look like we have surpluses, merely because production will be set to meet a level of aggregate demand that will no longer exist due to a collapse of purchasing power. Then production will disappear as well. [Did I tell you the ‘end game’ involved a (relatively) sudden ‘crash’ of now global supply lines…and the ‘excuse’ the fuckers will try to hand us is, ‘This wasn’t supposed to happen’…fucking liars!]

We tell people to make sure they have preserved capital as liquidity, as dollars (and other currencies) will indeed be worth a great deal in relation to available goods and services. Those who still have money will be the only ones with purchasing power. [Er, yeah…once the bottom drops out…however, this erroneously assumes people will retain ‘faith’ in fiat currency for more than a few days after the same governments allow our supply lines to collapse. How good will their pieces of paper be then? It will become a game of the ‘greater fool’ taken to the max. We need only look at Zimbabwe for a real life, real time example of how fragile ALL government currencies are!]

Q: 1933 = Diff'rent times, less people, less demand and less production in (all) aggregates.

Stoneleigh: Quite so. This time there are far more people with far fewer skills and far higher expectations. [Globally.] Moving into the same kind of crunch scenario will hurt far more this time. This is why I tell people that they have to build relationships of trust now to carry them (hopefully) through hard times. I don't say this because it's any kind of guarantee of success, but because it's all they can do and one has to do something. The big picture can look so awful as to be paralyzing, so people need to keep taking one step at a time. It's far better to do that than to lie down and die, or drink one's self to death as many Russians did after their smaller collapse. [More evidence of collapse that isn’t too far in the rearview mirror…for those who openly doubt it can happen!]

Q: If we have $20 oil there will be no crisis, guaranteed. $20 oil and we have lots of credit/money expansion. Multipliers working and inflation/growth. We would have commerce. We would all be buying shit from (low- wage/cheap coal) China. [She gets this one (mostly) right…]

Stoneleigh: I disagree. I think we will see $20 oil, but only because of a massive fall in aggregate demand due to the evaporation of purchasing power. $20 oil will not be cheap oil. On the contrary, it will seem very expensive to most people.

That is what deflation does - prices fall but purchasing power falls faster, making almost everything less affordable. As a much larger percentage of a much smaller money supply will be chasing the essentials, they will receive relative price support, meaning that their price will fall less than everything else, so the essentials will be the least affordable of all. [Leading to massive riots and subsequent loss of life/property…the property can be fixed…the lives, not so much!]

As with many things, demand collapse sets up a supply collapse and a resource grab, so we could see oil go from $20 to $500, if in fact there is any oil left on the open market at all by that point. Since oil IS hegemonic power in a very dangerous world, that may not be the case. [I agree that this will all go down long before oil ‘disappears’.]

Prices can rise in a deflation if there is a sufficient shortage of a critical good (just as they can fall in inflationary times if there is a sufficient surplus or production costs are falling rapidly.) If prices are rising in nominal terms, they are going through the roof in real terms against a backdrop of a collapsing money supply.

Q: Oil shortages (relative to credit- fueled demand) force an allocation regime on a 'super- size me' economic model of 'all of the above, please!'

Stoneleigh: By the time we have oil shortages, we won't have any credit-fueled demand because there will be no credit. First we lose the credit, which cripples purchasing power, then we lose demand (where demand is not "what you want", but "what you can pay for.") We'll have a temporary glut of oil, which will kill investment. [not that they are particularly interested in ‘wasting’ valuable energy on the ‘surplus population’.]

The lack of investment in new production, and lack of money for maintenance of existing equipment, and potential sabotage of existing equipment by those with nothing left to lose, set up a supply crunch. By that point very few have any purchasing power at all, and none of it credit-based, but governments and their militaries will be chasing down whatever is available for their own use (and hoarding where possible.)

Q: Look around you ... everything you see, that you will see tomorrow and the next day ... what you eat and wear and sleep under ... the computer you write on ... is a product of cheap oil. Where would finance be without it?

Stoneleigh: There was a primitive derivatives market in Holland in the 1630s (at the time of the Tulipmania). Bubbles of 'financial innovation' (ie the rediscovery of leverage) do not depend on fossil fuels. They have happened time and time again in history and are a product of human nature.

Energy, in one form or another, absolutely is a key driver of expansion, although one can build a ponzi scheme on surprisingly little of it because ponzi wealth is virtual wealth. It takes energy to build real things, but much less to build imaginary value. [But dare we ignore the finite nature of fossil fuel (along with the relatively tiny pool of people who rely on it for their ‘power’ (wealth) in this world?)]

Once a ponzi scheme has been created, it will collapse, as these structures are inherently self-limiting. Finance becomes a key driver to the downside, even where energy is still available.

Q: Maybe I'm wrong and maybe I'm an idiot but the confluence between you and I is where the US dollar becomes a proxy for crude oil rather than the proxy for commerce/business that was once upon a time leveraged from it. [Bobo is right, he IS an idiot to equate oil with money, although it is perfectly understandable where this idea came from with our ‘blood for oil’ mentality in the MSM/Washington.]

Stoneleigh: I am not convinced we will see the dollar become a proxy for oil. I think the dollar will rise substantially as dollar-denominated debt deflates (creating demand for dollars), and people make a knee-jerk move into it on a flight to safety. However, I don't think this will last more than a year or two at most.

I think we are headed into a chaotic currency regime where floating exchange rates are dropped, currency pegs instituted in an attempt to 'beggar they neighbour', and those currency pegs fail. I can't see any fiat currency coming that's being backed by hard goods, in that time. I can imagine a true hard currency down the road a few years, but I very much doubt it will be a currency that exists now. [Um, if there is ever a ‘global’ currency introduced, we are ‘well and truly’ screwed if the same people responsible for the current disaster are behind it. Conversely, the only way to put ‘the cheaper there’ out of business will be through the ‘standardization’ of money, something the slavers will be unwilling to do.

Q: Nobody seems to have any idea what the hard dollar is going to do to them, their families, loved ones, dogs, goldfish, etc. Almost nobody alive has ever experienced hard currency. The deflationary power of the hard dollar is going to hit this country like the hammer of Thor. It's conservation by the back door. [This is the ultimate fuckjob envisioned by today’s ‘goldbugs’, a hard currency that instantly turns them into kings just for having the ‘foresight’ to hoard what is essentially crap!]

Stoneleigh: Much of that will happen just by taking the credit out of the system, and if we do see a true resource-backed currency down the line, then it would be very much worse. It would amount to far more than conservation by the back-door though. It would be brutal deprivation with no regard for the most basic needs, let alone wants.

Q: Conservation isn't an issue unless there is something vital that needs conserving! It's not finance, Stoneleigh ... there is no limit to finance that is credit- based. There are only limits to finite natural capital! [This is why Libertarians are so dangerous! They so ‘don’t get it’!]

Stoneleigh: There is a limit to credit expansion, as there is to every ponzi scheme. [See Zimbabwe!] Eventually the debt created can no longer be serviced, the biggest sucker has been fleeced, expansion can no longer continue and we see the implosion of the structure, where the excess claims to underlying real wealth are messily and rapidly extinguished. The virtual wealth disappears. That is deflation.

Q: If cheap, accessible oil was available (still) it would be drilled, no?

Stoneleigh: It might well be left in the ground for later if there was already an excess of production relative to demand at the time.

Q: Take away oil and we have what we have ... a finance world without anything to leverage but rioting Greeks.

Stoneleigh: People have managed to leverage the darnedest things in human history. I'm not suggesting they do it in the absence of energy, but as I said before, the creation of virtual wealth through leverage takes much less energy than the creation of something real. Energy is required to fuel the necessary socioeconomic complexity of course, and it can be energy in many forms - food surpluses, wood or cheap/slave labour from colonies for instance.

Fossil fuels have enabled the largest increase in socioeconomic complexity in history, and financial innovation is part of that.

But finance is not purely a passive consequence. It is a key driver in its own right, especially during contractionary times, or maybe we should say: THE key driver both during Ponzi growth times and Ponzi contraction (collapse) times.

Did you ‘get that’ good citizen?

I didn’t think so…if anything this exchange only served to make already muddy waters even murkier (if that’s even possible.)

I don’t think our current situation can be successfully explained if you throw out or dismiss the key elements.

Which is to restate what I say in the intro…the number of people pointing at the ‘deliberate extinction’ of the surplus population still stands at one.

And that’s a damn shame.

Thanks for letting me inside your head,



Greetings good citizen,

Is this merely evidence of persistence in the face of certain doom or is this something more insidious? If you examine the evidence, you’ll find that die-hard capitalists really believe in ‘perseverance’

Because for them the game has never been about ‘satisfying need’, it has always been about ‘sheering the sheep’ the endless battle to keep ‘em stupid and broke!

Which is to say the capitalist considers themselves the ‘top of the food chain’ (which means he honestly believes he’s the best of the best, it doesn’t matter how much you shrink the pond, he’ll always be the biggest fish.

This goes hand in hand with ‘never enough’ syndrome.

That’s how dangerous this ‘social abomination’ known as capitalism is…civilization can collapse completely and capitalists will still do everything in their power to screw you! Not because they need to but because it’s what they do!

So we arrive at tonight’s offering where we catch some oblivious capitalists still up to their old tricks…

Building Is Booming in a City of Empty Houses
Published: May 15, 2010


“For the first time in three or four years, we have pent-up demand,” said an executive at the builder of Coronado Ranch. [Or so ‘shit for brains’ would have you think…Las Vegas is another one of those locations where if you don’t bring your job with you, you sure as shit aren’t going to find one when you get there!]

The chance to make money on the next housing boom “is like it’s never been,” Mr. Lee, a real estate promoter, assured a crowd of agents, investors and bankers. “We’re going to come back like you’ve never seen us before.” [Naturally, this redefines the term ‘irrational exuberance’…the buyers aren’t there…as evidenced by 10,000 vacant units!]

Home prices in Las Vegas are down by 60 percent from 2006 in one of the steepest descents in modern times. There are 9,517 spanking new houses sitting empty. An additional 5,600 homes were repossessed by lenders in the first three months of this year and could soon be for sale. [So, with a backlog of 10,000 unsold units, these fucking geniuses decided it was time to build more! Who are the bankers that are underwriting these crazy people? Because you know it only a matter of time before they show up in Washington, looking to be ‘bailed-out’…]

Yet builders here are putting up 1,100 homes, and they are frantically buying lots for even more. [I’m just ‘shooting from the hip’ here good citizen but something like this may be enough to bring back public executions! Hangings to be specific…not that I’d object to the return of the guillotine…]

Las Vegas is trying to recover by building what it does not need. It is an unlikely pattern being repeated in many of the areas where the housing crash was most severe. [Could this have something to do with most capitalists being ‘one trick ponies’? Since they don’t know how to make money some other way, they persist in doing what they know how to do, even after buyers for their scams have dried up and banks are under investigation for fraud…]

“There’s a surprising rebound in the hardest-hit markets,” said Brad Hunter, chief economist with the consultant Metrostudy. “People are buying again.” From the recession’s lows, construction has nearly doubled in Las Vegas, Phoenix and Tucson. It is up 74 percent in inland Southern California and soaring in Florida. [This definitely wouldn’t be the first time that speculators have ‘gotten ahead of themselves’ in trying to ‘time’ the recovery. The bad news is they do this with ‘other people’s money’…and when they blow that money, they walk away!]

Some of the demand is coming from families that are getting shut out of the bidding for foreclosures by syndicates that pay in cash, and some is from investors who are back on the prowl. [The ‘joke’ is on the legitimate buyer because the economy isn’t ‘recovering’, the economic books are being cooked by the ‘rah, rah, feel good, don’t vote us out of office’ crowd.]

Land and labor costs have fallen significantly, so the newest homes are competitively priced. Some of the boom-era homes, meanwhile, are in developments that feel like ghost towns. And many Americans will always believe the latest model of something is their only option, an attitude builders are doing their utmost to reinforce.

In Phoenix, a billboard for Fulton Homes summed up the builders’ marketing approach. “Does your foreclosure have tenants?” it asks, next to a picture of a mammoth cockroach.

Brent Anderson, a marketing executive with another Southwest builder, Meritage Homes, said it bought 713 lots in stricken Arizona last year, and was on the verge of starting construction in a new Phoenix community called Lyon’s Gate.

“We’re building them because we’re selling them,” Mr. Anderson said. “Our customers wouldn’t care if there were 50 homes in an established neighborhood of 1980 or 1990 vintage, all foreclosed, empty and for sale at $10,000 less. They want new. And what are we going to do, let someone else build it?” [Um, we can only wonder what bank(s) is buying this obvious horseshit…and if the bankers go bus a second time, and turn up in Washington, looking to be rescued, well, I don’t think it’s going to be pretty…]

All of this goes contrary to the conventional wisdom, which suggests an improved market for builders is years away. Nationwide, new home sales at the beginning of this year plunged to a level below any recorded since 1963, when the figures were first officially tabulated. [So are these morons suggesting that we all ‘trade in’ our ‘used’ homes for brand spanking new ones? The Rockefellers might be able to afford this but the average paycheck peasant certainly can’t!]

Simply put, the country already has too many houses, the legacy of wide-scale overbuilding during the boom. [There is currently a 9 YEAR housing ‘overhang’, are we supposed to tear these properties down because they are no longer ‘new’?] The Census Bureau says there are two million vacant homes for sale, about double the historical level. Fewer new households, moreover, are being formed as families double up for economic reasons, putting a further brake on demand.

Even some builders agree with the pessimists when it comes to Las Vegas. Meritage Homes, for example, has largely withdrawn from the city. “We don’t think it will come back for a long time,” Mr. Anderson said.

American West is betting the opposite is true. The developer, which is privately held and is based here, builds nowhere else.

The evening under the tent with Mr. Lee was the official start of American West’s new community, called Reserve at Coronado Ranch. Before it opened, buyers began putting down money for the houses, which sell for under $300,000. “For the first time in three or four years, we have pent-up demand,” said American West’s vice president for sales, Jeff Canarelli. [As many Florida builders found, it is one thing to take a letter of commitment and quite another thing to get the buyer to take delivery of the finished product. That may well be the case here.]

Disregard what you may have heard about how hard times may usher in an era of restraint. “With our buyers, they always want bigger,” Mr. Canarelli said. An American West home introduced during the recession comes equipped with an elevator. [Is the ‘assumption’ here that you’ll be too tired from working three minimum wage jobs to walk your sorry ass upstairs at the end of the day?]

One of the initial buyers at Reserve is Josh Snider, a surgical technologist who decided a year ago he wanted to buy his first home. He sought out a foreclosure, deals that were supposedly plentiful and cheap. “What a nightmare that was,” recalled Mr. Snider, 38. “I put in five or six offers and was always outbid.” [Um, it has been my experience that these ‘anecdotal stories’ are worthless, too much is left out. Was ‘Josh’ submitting bids that were way too low? It sure looks that way…]

He didn’t see any homes that were being sold by buyers in the traditional way. The price declines in Las Vegas have been so brutal that most homeowners with a mortgage owe more than their home is worth. If they must sell, their only option is a so-called short sale done with the approval of the lender, which can be a lengthy and frustrating process for all concerned.

Worried the market was going to turn around before he bought, Mr. Snider started checking out the new developments. He liked the floor plan, size and price of Reserve, which ultimately will have 310 houses.

A final incentive sealed the deal, this one courtesy of the United States government: he got a loan insured by the Federal Housing Administration, which meant his down payment was much smaller than a private lender would require.

The house, to be done in September, cost $273,500. “It’s not a bargain for everyone,” Mr. Snider said, “but it’s a bargain for me.”

He plans to live in the house with his girlfriend, Cindy Rojas, and his 12-year-old daughter.

Another early buyer is Irving Hallman, an investor from Hawaii. “I understand Vegas has its ups and downs, but we did the numbers and this house will hold its value,” Mr. Hallman said. [ How fucking trite! Is Mr. Hallman aware of how many buyers during the run up to the last crisis said THE EXACT SAME THING!]

There is a benefit to the seeming madness in places like Las Vegas. Building homes is the traditional fuel of a recovery. [So, the fucking BLS will be pointing to ‘insanity’ in Las Vegas and telling us the ‘economy’ as well as the ‘housing market’ are ‘recovering’…beautiful!]

“Housing is construction. It’s tables. It’s paint. It’s couches. It’s toilets,” said Sally Taylor, a specialist in liquor and gambling establishments who attended the American West festivities. “If we build more houses, we’re creating more jobs.” [Seriously good citizen, are people REALLY this stupid or do they grow them like that out there? They’re bulldozing ten thousand house lots from the ‘economic desert’ that is Detroit, why don’t they try building new ones to ‘revitalize’ the economy? I mean WTF!]

Across the street from Reserve’s three model homes is a new strip mall. Only one building is occupied, a gambling parlor. Others will start to be filled when more buyers join Mr. Snider and Mr. Hallman finds a renter. [Oh, that is too rich! Mr. Snider couldn’t buy a foreclosed property because ‘flipper’ kept beating him to the punch…now ‘flipper’ is buying up the contracts on what promises to be the next fucking ‘ghost town’! Which only proves that just because you have money doesn’t mean you’re particularly smart!]

Analysts have calculated that it could take as long as a decade for inventories to return to their precrash levels and for demand to once again exceed supply. That is a grim prospect for any owner who hopes to accrue equity through rising prices. [It is particularly grim for any owner that intended to use that equity as their retirement nest egg…]

A few experts, however, are starting to think the path to a better market will be much shorter. Stephen F. Auth, chief investment officer at the financial services company Federated Investors, is a housing bull. He says he does not believe that many extended families will end up all living in one place, like the Waltons in the 1930s. [It seems as though the term ‘expert’ is suffering from the same ‘definition problem’ that the word ‘bonus’ is suffering from…]

“That’s an unsustainable environment — Grandma coming home, Johnny moving back in with his new wife,” Mr. Auth said. “They’re going to move back out. The great housing depression is nearly over.” [It isn’t and won’t be over until jobs that pay decent wages make a comeback…and that isn’t happening here in the next Banana Republic…]

New-home sales in March rose 27 percent. But most analysts attributed the jump to the pending expiration of yet another government incentive, a tax credit for buyers, and said sales would quickly slump again. [Worse, it appears as though the recent ‘spike’ in sales activity is being driven by speculative buyers and not by the ‘natural expansion’ of home ownership.]

Even in Las Vegas, a community built on the willingness to be lucky, belief in a housing turnaround — and Mr. Lee’s portrait of a resilient city on its way to being a global “meetspace” — is provisional. Agents at the party said they had their hopes but were chastened by the horrors of the last three years. [Does anyone else think Mr. Lee is a ‘wasbeen’ stuck firmly in the past who is totally oblivious to ‘current events’?]

Afterward, packing up his video equipment, Mr. Lee said the party itself heralded a recovery. “We used to do this every two weeks, starting in the 1990s,” he said. “But this is the first time in 18 months. Believe me, it’s been famine around here.”

Apparently the article notes that American West is a ‘privately held’ company that only builds in Vegas…which is a shame because I’d be willing to bet this article would have driven him out of business if his stock were publicly traded…I know I’d short it!

In fact, if this article DOESN’T result in a FDIC investigation into the lending practices of the banks involved with these projects, there’s some serious ‘dereliction of duty’ going on!

The economy, such as it is, is ‘FUBAR’ good citizen…so signs that irrational behavior persists isn’t ‘comforting’ by any stretch of the imagination.

While this article represents a fine example of ‘investigative reporting’ but one can’t help but come away with the impression that its purpose wasn’t to expose corruption in the banking sector so much as to ‘cheerlead’ the economic recovery.

How desperate is that good citizen, we are shown evidence of a crime and told it is the ‘economic recovery’ in action…is there no limit to their depravity?

Thanks for letting me inside your head,