Wednesday, December 31, 2008
Sunday, December 28, 2008
Quarterback Tarvaris Jackson pulled it all together in the fourth quarter and the Vikings get their playoff berth... There’s a lot to like about the Vikings, but the win puts them back into a state of quarterback paralysis. If Jackson plays well in the postseason, how can the Vikings not look at him as their rock-solid starter for 2009?If Jackson plays well in the post-season, after playing well the last few games of the season, the Vikings have this "paralysis:" A young quarterback who is finally playing up to the expectations the Vikings had for him when they chose him in the first round, or a 38-year-old journeyman who will probably retire in a year anyway.
Oh my goodness, how will they ever choose?
Seriously, the only reason the Vikings had quarterback paralysis is because Jackson wasn't pulling it all together and they needed someone else before they ended up racing the Lions around the drain. Now that he seems to be*, problem solved.
* Seems to be. I still have serious doubts that he will ever live up to first-round QB status. But the kid's playing pretty well, so long as you're willing to overlook occasional end zone interceptions.
CARACAS, Venezuela - Venezuela will seize several gold mining concessions that previous governments granted private operators, in a bid to supplement falling oil prices with proceeds from state-controlled gold, President Hugo Chavez said Saturday...Famine may not arrive tomorrow. It may not even be soon. But the end result of the government taking over industry* is a reduction in economic output. And it happens even faster when the output of those industries, rather than being reinvested, is distributed to the very voters who chose Chavez to punish "some rich people" on their behalf. Those with skills will leave and Venezuela will be populated solely by Chavez and his adoring voters, neither of whom will produce anything. There can be no doubt that whatever horrors Chavez inflicts on the people of Venezuela - and they will be legion - they will have chosen for themselves.
"We are taking back some concessions that former governments have given, and whose permits are still held by some rich people," in order to reduce public reliance on oil, Chavez said...
Chavez acknowledges that oil prices — down 70 percent since topping $147 a barrel in July — will affect Venezuela, but he insists the wealthy will suffer more than the country's poor, who benefit from social spending programs that he vows to continue.
"Social investment will not be halted," Chavez said Friday. "This, for us, is sacred."
I thought about this this morning while sitting in church, where our youth pastor, who has a passion for orphans and adoptions, was talking about what Americans can do to help the children of the world. "Pure religion," noted long ago by Jesus' brother James and quoted against this morning - must of necessity include "visiting the fatherless and the widows in their affliction," in short, helping those who are in no position to help themselves. We who have been so blessed by God can do no less.
But I also thought about another country, Ethiopia, which suffered a disastrous famine 20 years ago** and a confession from Irish journalist Kevin Myers (well worth reading in its entirety) that when he slanted his coverage at that time to tug the heartstrings of the world to get them to "save" Ethiopia, something else happened as well:
We did more in Ethiopia a quarter of a century ago than just rescue children from terrible death through starvation: we also saved an evil, misogynistic and dysfunctional social system.And the population since then doubled, guaranteeing that when famine happened again (and it is happening right now) the suffering will affect twice as many people. The hunger was solved***, the problems that caused the hunger were not.
Those problems were not simply political, but cultural as well:
I am not innocent in all this. The people of Ireland remained in ignorance of the reality of Africa because of cowardly journalists like me. When I went to Ethiopia just over 20 years ago, I saw many things I never reported -- such as the menacing effect of gangs of young men with Kalashnikovs everywhere, while women did all the work. In the very middle of starvation and death, men spent their time drinking the local hooch in the boonabate shebeens. Alongside the boonabates were shanty-brothels, to which drinkers would casually repair, to briefly relieve themselves in the scarred orifice of some wretched prostitute (whom God preserve and protect). I saw all this and did not report it, nor the anger of the Irish aid workers at the sexual incontinence and fecklessness of Ethiopian men.A culture where the men don't work, where they drink and screw and play with guns all day**** instead of building a better life for their families, is a culture that will collapse - or has collapsed - and when it is saved from the results of its actions, its actions recur to produce the same results.
The Ethiopians are not how they are because of Europeans, though there may be so many of them for that reason. They are what they have chosen to be. Now Africa, Myers notes, is "heading towards a demographic holocaust, with a potential premature loss of life far exceeding that of all the wars of the 20th Century." It will be starvation on such a massive scale that we will likely be able to do little if anything about it. They will starve, from shore to shore. So will the poor of Venezuela, hooked on subsidies from a government they freely chose to steal on their behalf, once they have eaten everything "some rich people" used to have.
So when it happens, do we - individuals - let the children die because of the foolish choices of their parents?
Or do we save them and pass a problem twice as big to our kids in 30 years?
* Gold is not the first; it follows oil and steel and a number of others.
** Which was primarily caused by Ethiopia's own government. Most if not all of the famines of the past century have been so caused.
*** Or at least it dropped out of the news. At least one scholar has argued that, "The humanitarian effort prolonged the war, and with it, human suffering."
**** Which, in an ironic turnabout, pretty much describes the culture of Ireland before the coming of Saint Patrick - minus the guns, of course.
It's a good thing the Vikings aren't on TV here but 4 times a year, or I'd have ulcers.
* Little known fact: Childress was at the top of his graduating class at the Mike Tice School of Clock Management.
Saturday, December 27, 2008
Cooper described one reason why the Britons and English didn't get along this way:
[The trouble] begins, in fact, with the closing years of the 6th century AD and the arrival on these shores of Augustine, the Roman Catholic bishop whose job it was to bring the British Isles under the political sway of the Roman pontif.It was the mention of Bede that caught my attention*, and - since I came across the story tonight and, in true anal-retentive historian fashion, could not really continue to read until I had a) cleared any confusion up for myself, and b) blogged it - this long, meandering post is the result.
The story is well known from Bede et al how the British Christians who were here to greet Augustine declined his demand that they place themselves under the Roman authority, and were later massacred for their refusal at Bangor, twelve hundred of the finest scholars and monks of their day being put to the sword.
From that day on there existed an animosity between the Britons (Welsh) and the papacy that was to ferment throughout the early to late Middle Ages, only to culminate in the eventual expulsion of the papal authority from the realm of England under king Henry VIII, who was significantly himself of Welsh Tudor stock. - CH2
And it is not simply the troubles of King Henry that can be tied to the nefarious monk Augustine** it seems, but also the fact that Nennius could find little native British material to work with a century after Bede:
But in this context, the word hebitudo which Nennius used, suggesting something that has been made blunt or dull and which Morris renders 'stupidity', would perhaps better be translated as complacency or lethargy, the mood of the Britons that followed in the wake of the massacre of the monks at Bangor***. The profound cultural shock of seeing their finest scholars and spiritual leaders massacred by supposedly fellow Christians at the instigation of a Roman bishop no less, would have left a very deep wound indeed, and it is this state of mind amongst the Britons or Welsh that Nennius laments and which led to the neglect and loss of many records and books. - CH3OK, so Cooper's assertion is that an English Roman Catholic Archbishop instigated a massacre of Christians by other Christians over superficialities****. It was not the first time, nor would it be the last, so what's with the incendiary title to this blog? Well, it's just that when Bede tells the story, it's a little different:
For afterwards the warlike king of the English, Ethelfrid, of whom we have already spoken ... observed [the British] priests, who were come together to offer up their prayers to God for the soldiers, standing apart in a place of more safety; he inquired who they were or what they came together to do in that place. Most of them were of the monastery of Bangor ... [and] resorted among others to pray at the aforesaid battle, having one Brocmail appointed for their protector, to defend them whilst they were intent upon their prayers, against the swords of the barbarians.Obviously we're talking about the same battle - there are 1200 monks of Bangor monastery killed, and both Cooper and Bede make the massacre a direct consequence of their refusal to submit to Augustine's authority.
King Ethelfrid being informed of the occasion of their coming, said, "If then they cry to their God against us, in truth, though they do not bear arms, yet they fight against us, because they oppose us by their prayers." He, therefore, commanded them to be attacked first, and then destroyed the rest of the impious army, not without considerable loss of his own forces. About twelve hundred of those that came to pray are said to have been killed, and only fifty to have escaped by flight...
Thus was fulfilled the prediction of the holy Bishop Augustine, though he himself had been long before taken up into the heavenly kingdom; that those perfidious men should feel the vengeance of temporal death also, because they had despised the offer of eternal salvation. (Book II, Ch 2)
But there are three phrases above - buried in the text, I'll admit - that lead us upon careful reading to reach precisely the opposite conclusion of Cooper.
The first is "though [Augustine] had been long before taken up into the heavenly kingdom." By the time this battle occurred, Augustine had "long before" died, so it is rather unlikely that the monks were massacred, as Cooper insists, "at the instigation of a Roman bishop," whom Cooper has already told us was Augustine.
OK, so maybe in his will he left instructions for good Christian soldiers to kill all the British monks - after all, Cooper insists they were killed by "supposedly fellow Christians." What saith Bede? The second phrase to note is that the priests were being protected "against the swords of the barbarians." Not fellow Christians - "supposedly" or otherwise - but pagan English soldiers. It is important to remember that Bede is likewise English, so he would probably not have used "barbarians" to refer to them unless he was talking about non-Christian English.
OK, so maybe the soldiers were pagans, but certainly the king who gave the command, Ethelfrid, was a Christian. Maybe he had secret orders from Augustine. Well the third phrase to consider is Bede's "Ethelfrid, of whom we have already spoken." Where had Bede already spoken of Ethelfrid, and can we from that discern the English Bishop's guilt or innocence?
At the end of Book I (Chapter 34), Bede introduced Ethelfrid, who was at that time kicking the Scots out of Northumberland before turning his attention to the British. Bede compares him to a very famous Biblical character, with one notable exception:
At this time, Ethelfrid ... ravaged the Britons more than all the great men of the English, insomuch that he might be compared to Saul, once king of the Israelites, excepting only this, that he was ignorant of the true religion.He was ignorant of the true religion. In short, Ethelfrid was a pagan, leading an army of barbarians, long after the death of Augustine, resulting in the destruction of the Bangor monks. Bede makes the death of the monks a spiritual consequence of their disobedience, fully in line with his ecclesiastical purpose. Cooper makes their slaughter a direct exercise of Roman Catholic power against religious dissenters. Cooper's conclusion is therefore so far from the actual words of Bede that I really wonder if he ever read him.
* as well as the et al, as there really is no one else writing during the period but the Venerable One that could be et, much less al.
** Not the earlier theologian (Augustine of Hippo), but the first Archbishop of Canterbury. I suspect that in Cooper's opinion, the office has been little improved in recent years. There I must agree.
*** The battle was actually fought at the City of Legions (modern-day Chester) rather than Bangor. That's just where the monks were from.
**** In this case it was the date of Easter and the cut of the tonsure (the monks' ultra-stylin' hairdo) among other important issues of the day.
Thursday, December 25, 2008
Rogue, picking up a piece of paper on the kitchen counter: Can I throw this away?A Merry Christmas to all, and may God bless you in the new year.
El B: Yeah, I'm done with it.
Rogue, looking at it for the first time: What is it?
El B: It's nothing, really.
Rogue: 12, 22, 30... what were you graphing?
El B: how many presents the singer got in The 12 Days of Christmas.
El B: Didn't you ever wonder if they fell along a bell-shaped curve?
El B: Not even once?
Rogue: What in the world is wrong with you?
Tuesday, December 23, 2008
Dec. 22 (Bloomberg) -- Mortgage modifications meant to keep borrowers from losing their homes fail within six months more than half the time, U.S. bank regulators said today.Here's why: It's a dumb idea, because even after jiggling the interest rates or attaching bizarre equity-sharing provisions, most people who couldn't afford their houses under the easiest credit terms in human freaking history still can't afford their houses.
About 55 percent of loans modified in the first quarter of 2008 were 30 or more days delinquent after six months, the Office of the Comptroller of the Currency and the Office of Thrift Supervision said in a report issued today.
“Re-default rates increased each month and showed no signs of leveling off after six months,” Comptroller of the Currency John Dugan said in a statement. “This trend of increasing delinquencies underscores the need to understand why these modifications have not been more sustainable.”
But considering that "modification" is the chosen vehicle of the Republicans and Democrats as well as the private sector*, it looks like loan modification is going to be the chosen solution to the foreclosure "crisis."
So we'll keep modifying and foreclosing and defaulting until house prices wind up where they were going to go anyway**, and everyone who is in more house than they can afford moves to less house anyway, and everything that would have happened without government interference will happen anyway, only it will be spread out over years and will cost a ton of other peoples' money.
* by which is meant not the private sector, but "a coalition of major lenders, servicers and consumer advocates." In other words, people who follow the government around and pretty much do what it says because they live off its money.
** that being a reasonable multiple of the buyer's earnings. All the ARMs and subprimes and Freddies and Fannies and FHLBs and all the other programs are designed to allow people to buy more house than their earnings will allow. Unintended Consequence Fail.
I work one day before Jan 5 - I was scheduled for a phlebotomy at work and figured since I had to drive in I might as well put out fires for a few hours*. But vacation won't be gaming for me as much as finally jumping wholesale into that pile of books on my dresser. The Traditionary Annals of the Cymry has been neglected far too long.
UPDATE: On second thought - inspired by MikeT and Huck - maybe I'll play some games, too. And take a nap in front of the fire. Specialization, as Heinlein noted, is for insects.
One should aspire to be a slack-of-all-trades.
* there is more than one way to give blood
Monday, December 22, 2008
Dear El Borak:Dear Mr. Laundry:
I'm a young (soon-to-be) husband, and I'm a bit concerned about my wife's idea that we are going to "share" chores. It's not that I mind working, but I get the distinct impression that while my wife will be happy to share the household chores with me, I'll be sharing the outside chores with my lawnmower and chainsaw. So how can I ensure that our distribution of household chores is really a distribution?
My Mom Did All My Laundry
The secret to success in marriage goes far beyond who is going to to do the dishes or wash the underwear. In fact, if you are going to succeed as a beloved and treasured (if seemingly somewhat hopeless) husband, you will need to learn the skill of selective incompetence.
Selective incompetence is not ignorance - mere ignorance can be cured simply by learning to do something. No, incompetence longjumps that boundary to ensure that others will wish to take upon themselves the tasks at which you are incompetent rather than showing you how to do them.
If your mother truly has done all your laundry, then you are merely ignorant and not (yet) incompetent*. Unfortunately, in order to cultivate incompetence properly, you are still going to have to learn to properly perform the task you wish to avoid.
So let's say that you wish to develop your ignorance of laundry into a true incompetence. This demands that you perform two tasks: buy a brand new red t-shirt or sweatshirt - just set it aside for now - and learn to do laundry properly.
Doing laundry properly is not difficult once you understand that items like fabric softeners and bleaches are purely optional. The important distinction in laundry is in colored clothing and white clothing. Colors are washed in warm (or if they are new, cold) water; this protects their colors from being bleached out - we've all seen the difference between a brand-new shirt and one that's been around the block (or the agitator) a few too many times. But those color-draining qualities of hot water are necessary to keep white clothing looking its best.
So with that in mind, it's time to do some laundry. Assume you have a large, mixed pile of laundry just waiting for your incompetent touch. We'll start with whites, so separate as many of those out of the pile as you can. For now, avoid white t-shirts and just throw as many of her bras and panties into the machine as you can find (for safety at this point, put in a few of your tighty-whities as well) but don't go overboard, you only need enough to make a medium-sized load.
Turn the knobs on the washer to hot wash/hot rinse, and set the size button (if there is one) to medium.
Take a look at the detergent box (or bottle) and then measure the recommended amount either into an attached container if you have a side-load machine or just pour it directly on the laundry if you have a top-load machine. Don't bother with bleach or any other optionals.
You are now ready to wash your load of whites. Throw your red t-shirt on top, close the door, and turn the machine on.
When it is finished, your shirt will be unharmed - in fact, it will look as good as new. And everything else in the wash will be a beautiful and permanent pink**.
Your wife will still wear pink bras and panties - no harm done there - but she is certain to conclude that you are incompetent and will be happy to keep you as far from the laundry as possible, lest you "accidentally" make one of her sweaters teddy-bear sized.
Congratulations, you are well on your way to being incompetent! Just make sure you are mowing the lawn when the results of your success are discovered.
* If you have never done laundry (and if your wife knows that) it will turn out to be a huge point in your favor. Make sure you tell her, just in case.
** now you see why we avoided putting in any t-shirts; the pink skivvies you'll have to suffer for a while, but it's a small price to pay to avoid your conspiracy being discovered.
Saturday, December 20, 2008
Rickards will lay out his worst case scenarios in a lecture sponsored by the Navy and the Office of the Secretary of Defense for Policy tonight. And his forecasts aren’t for the faint of heart.In some ways, being the "ultimate bear" is very liberating. It allows you to, at least theoretically, step outside the clutches of mainstream economic and political thinking. It also allows you to recognize that "mainstream" is a useful euphemism for "safely within the confines of modern American middle-class imagination," and to accept that bad things can happen in America, even if voters don't wish them to.
Rickards calls it the “A to Z” problem: What are the threats that could make the U.S. economy look less like America and more like Zimbabwe? ...
In many ways, Rickards is the ultimate bear. He’s not just thinking about whether the stock market will decline, but whether or not the stock market will survive.
All that puts Rickards decidedly outside mainstream economic and political thinking in America.
Economical correctness puts limitations on what, for example, a president is allowed to say. He is not allowed to say anything bad about the future (e.g. we are going into a depression) but only good things, except as hypothetical outcomes of not following his policy recommendations. He can tell some of the truth about the present (e.g. we are in a recession), but only after he has cover from the duly-authorized authorities who come out and say that according to their math we have been in one for a year*. In short, even though the most powerful man in the world, he is constricted by convention: there are certain things that are economically correct and certain that are economically incorrect, and he must keep himself safely within the confines of the former.
But it is not simply convention; it is also ideology, and that is where the true danger lies. Not the "conservative" ideology or "liberal" sort, but the American one that all of us share and don't really notice, and therefore do not consciously account for. The otherwise-invisible boundaries set by that convention can be clearly noted in how the threats against us are portrayed, as in the second threat noted by Rickard, dubbed "The China Syndrome":
The Chinese own more than $500 billion worth of U.S. Treasury bonds, and billions more in the debt of other U.S. entities such as those held by Freddie Mac and Fannie Mae. And a general sense of mutually assured financial destruction keeps them from wielding that debt like a weapon: if the Chinese dumped U.S. debt on the global market, their own holdings of U.S. debt would decline in value, the U.S. economy would be damaged, ultimately harming the Chinese economy by reducing American ability to buy more Chinese goods.The danger, of course, is in finding such an act by China to be de facto irrational. And herein lies the American blind spot: we define "irrational" as "losing money." The Chinese would be crazy to tank our economy because it would cost them a bunch of money. We sleep well in the assumption that Mutually Assured Financial Destruction is our ace in the hole, allowing us to act as we wish without fear of reprisal.
They’d have to be crazy to try it. But Rickards points out that governments don’t always do the rational thing...
But what if was not really about money? What if the Chinese had a goal, a political goal, that they considered more important than the money it would cost them to achieve it? What if, for example, they considered it probable that they could get Taiwan with all its technology, and all they would have to do is tank the US economy to the point where we were too busy putting down riots in our own streets do defend it? Is that still irrational?
The danger is not really China or what they will do. The real danger lies in the assumption that we enjoy the liberation of true economic bears while we fail to examine scenarios that fall outside American-centered cost-benefit analysis. The business of America may be business, but we make a huge mistake in assuming that the goal of the rest of the world is to become like America.
* which is obviously a huge surprise. I mean, who would have guessed?
Friday, December 19, 2008
With the Big Three seeking a bailout from Washington, the Big Ten are following suit. Earlier this week the Carnegie Corporation of New York took out a two-page ad in the New York Times, signed by executives of 36 public universities, state university systems and higher-education associations, urging Congress and President-elect Obama to rescue them.Even though it might endanger my current job*, I would love to see a lot of colleges in the same about-to-be-reorganized position as the Big 3 are right now. As important as education is, it is not helped as much as its backers claim by completely separating it from market realities. Colleges should not all be business schools or even businesses; on the other hand, it is hard to argue that an organization that takes taxpayer funds to provide young people with women's studies degrees is not doing both its students and its patrons a very expensive, almost GM-ish, disservice.
* though not as much as one would expect. Less reliance on state funding makes my work more important, not less. Still, layoffs are not always rational cost/benefit decisions.
For the first time since Election Day, Democrat Al Franken is ahead of incumbent Norm Coleman (R) in Minnesota’s still-undecided Senate race.Yes, they are still counting November ballots in Minnesota. They have to keep counting them so long as new ones are being discovered. And they will keep being discovered until they give the right answer.
Much to PiffordT's chagrin*, it looks increasingly likely that Al Franken is going to Washington as the junior senator from Minnesota, conclusive proof that God has an absolutely brutal sense of humor.
Sometimes I wish I was going to live long enough to see what the history books had to say about the last years of America. Most of the time, though, it's enough just to watch them.
* Don't get me wrong, he despises Norm Coleman as much as the next guy**. It's just that he's thinking, "Dear God, why couldn't Franken have been from Green Bay?"
** That being me.
"The terms and conditions of the financing provided by the Treasury Department ... protect the taxpayer by ensuring that only financially viable firms receive financing," according to a statement released by the White House...It never seems to bother these people that "financially viable firms" do not need government financing, pretty much by definition.
"If the firms have not attained viability by March 31, 2009, the loan will be called and all funds returned to the Treasury," the statement says.
But let's see if I have this straight: we are going to give these cash-hemorrhaging companies $13 thousand million to keep them in business for the next 3 months*. At the end of the three months, if they have spent the money, they have to give it back.
Like the article this morning that claimed that these were "short term" loans, I do not understand how the financial press can report such lying drivel as if it were a) news, or b) in any way connected to reality.
* much of which time they will be shut down anyway. It's a pretty sweet deal for the workers, as they receive full pay and benefits. All they have to give up is the joy of actually going to work.
Thursday, December 18, 2008
JACKSONVILLE, Fla. -- A divorced Jacksonville woman said her former church has threatened to "go public with her sins" and tell the congregation about her sexual relationship with her new boyfriend...I hope nobody in that church tells a TV station and they put it on their website. Then she would be really embarrassed.
"Because I have a boyfriend that I'm involved with … to not be married to that person is a sin...
"On January 4, my sins will be told to the church, publicly, with my children sitting in the church and my friends," Hancock said.
Look, I know we're all supposed to say, "wow, what a horrible church," but I think in this case she has very little to complain about*. If she's telling the press, then this is obviously not some big secret that's going to ruin her life if it gets out. In fact, I suspect that given the number of people sitting in the congregation who are themselves doing the same thing, it might cause some much-needed reflection**.
The rules are quite simple: a Christian must choose either chastity or marriage. I know they are hard to keep, but they are not difficult to understand. There is simply no place for whining to the press that your church is trying to make you obey Jesus.
* Other than their overzealous misapplication of Matt 18. The person to "tell it to the church" is the person who is being wronged (v 15), which would be her husband if she were still married, or the boyfriend's wife if he was. So far as I know, sexual sin is not a de facto sin against one's pastor, therefore he has no business invoking Jesus' admonition here.
** assuming, as I don't, that they actually think about it rather than basking in it.
... which in Duluth, Minnesota*, was a pretty cold place in the winter, as you might imagine. Now the coolest thing about my high school was its lunchroom, which was round and featured a view of Lake Superior, Saint Louis Harbor, the Aerial Lift Bridge, all the stuff that caused that particular bit of real estate to be Duluth's most highly prized. But in the winter, we watched none of that. We watched the smokers.
The "smoking area**" was just outside the lunchroom, tucked into a little covert on the southern side of the main building where it joined the lunchroom. Its location was important for but one reason: when it was windy - as it usually was on top of that hill - all the snow would blow across the flat roof of the school, which created a constant storm of churning, blowing, swirling snow in that very spot. So all winter long, the smokers would have to put on their parkas and big boots and head out into the perpetual snowstorm to have a smoke between classes.
If you've ever seen a nicotine-deprived kid trying to light a cigarette in the middle of a snowstorm while wearing a parka, you'll know why it was a lot more fun to watch them than to look at the lake.
* It wasn't 15 miles up, but about 6 blocks. Still, it was an adventure walking home in the wintertime in cowboy boots. Well, sliding home, to be more exact.
** tobacco laws were unenforced except among athletes, which meant that it was my last day as a senior before I brought a pipe and joined the smokers for a break.
Tuesday, December 16, 2008
The Federal Open Market Committee decided today to establish a target range for the federal funds rate of 0 to 1/4 percent.The bullets are gone. The zombies have not even arrived yet; heck, we just found out we were 'officially' in recession a week or so ago*. Interest rates for banks to borrow money are as close to zero as one could imagine, though one can reasonably expect that if the series of cuts from ~6% to 1% didn't stop the bleeding, a cut from 1% won't make much of a difference, either. Heck, with interest rates on gov't short term debt yielding in some cases negative interest rates anyway, the Fed move is not a tool to fight recession as much as it is an acknowledgment that deflation is here**. Once it washes out, the inflation will likely be one for the history books.
Now that the Fed can no longer lower interest rates - apart from, I suppose, paying banks to borrow - all they can do is manipulate markets by creating dollars to buy up crappy assets***. We have, to be blunt, entered uncharted monetary territory: no one has ever done what we are doing to escape the consequences of what we did before. That means a time of testing - even a science experiment, if you will - is upon us: either Keynesian economics will still save us all by getting us to spend money created from nothing for that very purpose, or we will discover what horrors await us when that switch marked, "For God's sake, do not pull!" is pulled.
There is not much more to do now but to cross the streams and say, "See you on the other side, Dr. Venkman."
* that it was backdated a year is hysterical, considering the efforts that GOP shill sites like Newsbusters.org have gone to to deny it during that entire time. Since it has been obvious to anyone with a pulse that the economy has been in recession at least that long, maybe the zombies were with us the whole time. McCain 2012!
** But just as a note of interest, as David Craft asked about the three horsemen of financial apocalypse: on the Fed news today gold again crossed the old ($850) high to $860 and the dollar bounced off 80 (80.06). Those numbers will remain important in a rear view mirror sort of way.
*** It's a good thing Bush sacrificed his principles to get us here. I mean, who knows where we would be if leverage actually had a cost.
Monday, December 15, 2008
Sunday, December 14, 2008
Last year, the Iranian government blasted Warner Bros over its "anti-Iranian" blockbuster 300, a graphic novel-based retelling of the Battle of Thermopylae, in which the Greeks triumph over the Persians.If you call "every last Spartan killed by Persia's overwhelming army" a victory, then Thermopylae was a rousing success. Otherwise, it will have to be filed under "Moral Victories" or maybe "Famous Last Stands."
From the Same As It Ever Was file:
[Bernard Madoff] somehow pulled off the [$50b] fraud despite being subject to examination by the SEC, Powers added. "You wonder how these things escaped the normally careful* review of these regulatory organizations."Obviously what we need is more regulation.
From the Did the Editor Even Read This Story? file:
(CNN) — Sen. John McCain promised Sunday he will work to build consensus in tackling the huge challenges facing the country, and criticized his own party for its latest attack on President-elect Barack Obama.The story is titled, "McCain vows to help lead ‘loyal opposition.’" It should have been called, "McCain returns to pre-election form." To my dying day I will never understand why the GOP nominated this guy.
From the I Blame the Squirrels file:
(CNN) -- Up and down the East Coast, residents and naturalists alike have been scratching their heads this autumn over a simple question: Where are all the acorns?I'm telling you, those little buggers are trouble.
* Seriously, that's what it says. You can't make this stuff up.
Saturday, December 13, 2008
Why not attack the situation in a manner that will benefit most everyone, an approach that has been successful before and, when compared to the current course, has little downside?When someone says that only the banks would be screwed and neglects to mention every little old lady who has money deposited in those banks, you know he hasn't thought things through. You see, every depositor in those banks will also be paid in devalued dollars, as would every retiree and pensioner who expects to receive x dollars per month for their life's work. Every employee would be paid in devalued dollars - if you think companies are going to immediately increase wages 43%, you're crazy. In fact, everyone who receives dollars for anything would immediately find their standard of living reduced by 30% or so, and while they may get away in the short term by paying less for rent or a mortgage, they will not get away for long. That is the entire inflation problem in a nutshell - it rewards debtors by punishing savers and pensioners.
Here it is. Stand back. World currencies should be devalued overnight.
It can be done on a country-by-country basis, but a coordinated devaluation would work best. A devaluation of 30% would raise the dollar value of all assets by 43%. A $200,000 home with a $230,000 mortgage would become a $286,000 home with the same mortgage. Presto! The homeowner who was $30,000 upside-down now has $56,000 equity and a good reason to make his payments. Both the homeowner and the bank are immediately better-off...
Only debt would remain the same. All other assets would immediately be worth more (in nominal terms), whether it be a home, a stock, an ounce of gold or a used car. Bank balance sheets would immediately improve, as many loans would be moved from non-performing to performing status. Banks would be paid with devalued dollars, but they made millions creating the mess.
But even assuming that it was moral and desirable to immediately reduce the value of our currency - and all currencies - there's one little problem: it cannot be done, and the reason it cannot be done is that currencies are not things that have value except in relation to one another. If you do not change their value in relation to one another, you are not really changing their value in any manageable or predictable sense.
The major place where he goes wrong is in using the Great Depression as an example*, for FDR DID devalue the dollar, from 1/20.67th of an ounce to 1/35th of an ounce**. The difference today is that we are no longer on a gold standard. The dollar is no longer a measure of gold, nor is it beholden to gold. In fact, the dollar has already been devalued from $250/oz 6 years ago to about $800/oz today, a devaluation of 70%. That is a massive problem, not a solution.
So let's say that one wanted to re-value the free-floating, vaporous apparition that is a dollar against "things" but not against other currencies, which would themselves be re-valued against those "things" by the same amount? It would not be done by adjusting contracts: remember the purpose is to pay full contract price in "cheaper dollars." Would one mandate higher salaries? Impose price controls to force higher prices? You could not do any of those things*** without putting the US economy under a Politburo that forbade ALL free contracts. It is, in short, impossible to devalue currencies against things that are not legally tied to the dollar without first tying them to the dollar. And if one thinks the economic problem is bad now, just wait until you have to ask Washington to set prices on the baby clothes you wish to sell at a garage sale.
Of course, that a solution is as idiotic as it is unmanageable is no guarantee that it will not be tried; in fact, if things get bad enough it is almost guaranteed to be tried. It will not be America's economic problems that will kill us, but I make no such guarantees for the "solutions."
* a second place is where he claims that devaluation cured the Depression - it manifestly did not. Unemployment was still almost 20% in 1938 and production fell to 1934 levels. It is unfortunate but true that WWII ended the Great Depression.
** the way it's usually stated is that the price of gold was raised from $20.67/oz to $35/oz, but it didn't re-value gold, it re-valued the dollar in order to allow more dollars to be created against the same gold reserves, which were used at the time to settle international accounts. Today international accounts are settled in dollars.
*** The author claims that houses, used cars, and gold would also command higher prices. How could that be, since their prices are market prices? Since no one would have more dollars, whence comes the increased demand to drive up all prices the desired - and only the desired - amount?
Friday, December 12, 2008
You gotta know I'm happy about this. Even though I don't suspect it will last long*. But it is kind of funny to see stories like this one by the same people who once foresaw $200 oil right around the corner now saying that $45 is what we can expect** in the short term. Of course, one can also find predictions of oil at $10 - those are likely to be as accurate as oil at $200 were 6 months ago. If it does, that's fine. But I wouldn't count on it.
* And even if it does, no matter. Within a few weeks - as soon as this wholesale number works its way to retail - I'll be topping off both of my tanks. Then it can go wherever it wants for the next year or so.
** This is the most incredible prediction I've ever seen, since the price of oil as I type this is $44.84.
Thursday, December 11, 2008
(hat tip: Bethie)
So anyway, I got to talking about the aforementioned bailout yesterday with the big cheese of our local public radio station* and with one of our officers who works with a lot of technology industry execs. While both of them are politically and economically far from where I stand, I was surprised at how similar their expectations were to my own:
1) Auto is in HUGE trouble. Not just the big three, but even the really nice, profitable import companies took a dive in October. The bailout is simply a down payment, not even a beginning of a solution. GM and Chrysler will burn through that money in 6 or 8 weeks, and will be back for more. Nothing will have changed and nothing can change without bankruptcy.
2) There is one more wave of home foreclosures coming, about March, and that should mark the low point. Not the end by any means, but the hugest damage should be done by then and we will be cleaning up for a few years. The midwest escaped the best of it, and we will escape the worst of it. Sorry Huck and MikeT.
3) While we are not going into a 1930s dustbowl Depression, it's going to seem like it for a lot of people. Tens of Millions. And we will remain in it until habits - and America's industry - change significantly. This is not one we will be spending our way out of.
Of course, I don't know if any of that will happen, I just thought it was interesting that a libertarian, a Republican, and a fairly liberal Democrat shared very similar expectations about the immediate economic future.
Needless to say, that is almost conclusive proof that we will be wrong, on at least one of those things**, in a major way.
* NPR laid off 7% of its workforce yesterday, which is what got the conversation rolling. We don't normally talk about economic horror at our Christmas party.
** If I had to guess, I would guess it is the last one. At least that's the one I'm least certain about.
Monday, December 08, 2008
I will miss you so much.
UPDATE: But the aftermath* is going to rock:
Liberals are growing increasingly nervous – and some just flat-out angry – that President-elect Barack Obama seems to be stiffing them on Cabinet jobs and policy choices.Heh. Pwn3d.
Obama has reversed pledges to immediately repeal tax cuts for the wealthy and take on Big Oil. He’s hedged his call for a quick drawdown in Iraq. And he’s stocking his White House with anything but stalwarts of the left.
* In a "four years of making fun of liberals' credulity" sort of way, not a "Wow, Obama is really going to save us" way, obviously.
Publisher and broadcaster Tribune is preparing for a possible bankruptcy-protection filing as soon as this week, The Wall Street Journal reported on its website on Sunday, citing people familiar with the matter.But it's not just the owner of the Chicago Trib and the LA Times, that other Times is also making strange moves:
The New York Times Company plans to borrow up to $225 million against its mid-Manhattan headquarters building, to ease a potential cash flow squeeze as the company grapples with tighter credit and shrinking profits.Borrowing money against long-term assets for short-term cashflow needs is generally not a wise course of action for a company*. But with ad revenue down 18% last quarter alone, with newspapers from coast to coast being put up for sale**, and a number of them closing or threatening to close, it appears that the newspaper industry is in a heap of trouble.
The presses will stop***. Printers will lose their jobs. Reporters will have to work at Wal*Mart but no one will buy no one will buy their stories about how terrible and awful it is to have to lift and push things all day long.
Isn't that sufficient reason to bail them out?
* It's not just the NYT; the Seattle Times is doing the same thing.
** It's so bad that the Rocky Mountain News all but admits that no one can make money if they buy it: "...the most likely candidates are local investors who think the Rocky is too vital to vanish, entrepreneurs who might want to elevate their civic profile in the same way owners of sports teams do or private equity groups that think they can exploit the business in ways current owners haven't."
*** The NYT will no longer be able to make stuff up and pass it off as news.
Sunday, December 07, 2008
But in the meantime, as I'm sitting here taking a break I notice a book that son Tomas had to read for one of his classes, which happens to be the same book a relative sang the praises of** about 6 months ago: Nickel and Dimed, by Barbara Ehrenreich.
This will not be a review, as I'm very strict about never reviewing books that I have not read. Luckily for you, that does not extend to not making fun of them.
Nickel and Dimed is the story of how a PhD (biology) clueless liberal writer decided to learn "How the other half*** lives." In short, she gets a series of minwage jobs as research for an article on welfare reform and then writes a book about how noble the working poor are.
I'll let the back cover explain it:
Millions of Americans work full-time, year-round, for poverty-level wages. Barbara Ehrenreich decided to join them, inspired in part by the rhetoric surrounding welfare reform, which promised that any job equals a better life... [T]aking the cheapest lodgings available and accepting work as a waitress, hotel maid, house cleaner, nursing home aid, and Wal*Mart salesperson[, s]he soon discovered that even the "lowliest" occupations required exhausting physical and mental efforts...No shit, Sherlock. Other people work hard for a living.
Nickel and Dimed reveals low-wage America in all its tenacity [and] anxiety...
I'm continuously amazed that liberals are amazed that other people, regular people, have to work jobs that are not a lot of fun and do not pay well. In Office Space, Peter asked Lawrence what he would do if he had a million dollars**** because no one would clean up shit if they had a million dollars: Liberals who have never worked real jobs, moving directly from home to college to New York publishing houses, never seem to confront the opposite of this question in real life. Instead they buy books about it and comiserate with their peers.
Humans shit. Someone has to clean it up. Animals have to be killed and cleaned. Halls must be swept, trash picked up, lettuce harvested, and yes, lattes made by someone. That some people can escape the mundane biological necessities by getting PhDs is not an indictment of anything about the American system, but a brief reflection on a strange time in world history where a few people get to escape what have been the harsh realities of human life for most of human existence.
One of the things that will be most interesting - and perhaps satisfying - about America's coming abrupt return to the realities of history will be the pure number of educated liberals with useless advanced degrees who find themselves dealing firsthand with the hard, thankless drudgery that most humans experience on a daily basis. Someone has to clean up the shit, and as good a liberal as anyone else. And fortunately, there will not be enough liberals of the insulated, amazed sort left to justify publishing books about the experience.
* I have to do one presentation on why Chile's highest government honor is named for a ginger kid (in English), another on the wines of Chile (in Spanish), a paper on 5 Greek philosophers and mathematicians - all Wednesday - plus a Spanish test Tuesday. If all goes well, I will have no finals to do next week.
** which I ignored after looking at the book and briefly feigning interest in it.
*** defined as people who do not have PhDs or write for a living.
**** besides two chicks at the same time.
Thursday, December 04, 2008
The Williamses, suspended for four games by the NFL on Tuesday for violating the league's policy on anabolic steroids and related substances, were granted a temporary restraining order to rejoin the team by Hennepin County District Court Judge Gary Larson*. The suspensions came two days after the Vikings moved into sole possession of first place in the NFC North with a victory over Chicago.In all likelihood, both members of the Williams Wall will serve a four-game suspension for violating the league's anti-doping policy. The Vikings have four games left in the season, and they'll need to win three, including this weekend, to ensure that they win any tie-breaker with the Bears and make the playoffs. Still, why not wait to appeal the league's decision until Sunday afternoon?
The issue is basically one of scheduling. If there is a game the Vikings can live without them, it is this weekend before they go back onto the road for three eminently losable games. Had they sat out this game and waited until Sunday to appeal**, two scenarios develop. If they win the appeal, then they have simply sat out a game the Vikings likely didn't need them anyway - no harm no foul. If they lose, at least they will be back in time for the playoffs.
On the other hand, by appealing today, they have increased the odds that they will play against Detroit at the cost of missing the first game of the playoffs, which I would venture to opine, will be against a tougher opponent than the winless Lions.
But it does make me wonder, since Alan Page sits on the Minnesota Supreme Court, maybe they figure the fix is in?
* and I know all y'all wondered what happened to "The Far Side."
** after all, they won't be any more suspended Sunday than they are today.
Wednesday, December 03, 2008
Lecture today, December 3rd, 316 Hughes Hall at 1 pm.Does that make any sense at all to someone other than an art major?
Mr. Waak, from Lancaster, PA, will exhibit One Kernel Popcorn Popper in the University Gallery November 25-January 22, 2009.
Waak's three dimensional thought and desire to reach the viewer through authority and quality of craft. Waak says sculpture involves the body, a visceral experience. Our bodies have an outside and inside, a space of containment that is powerful.
"Everything I make shares this element of volume. In my work, the space is empty. I leave it up to the viewer to fill it. It might be by placing a kernel of popcorn into a chamber, or by entering a form with their eyes. This gives the viewer an opportunity to be involved with the work."
To cushion the fallout, Federal Reserve Chairman Ben Bernanke said Monday that the central bank is prepared to lower its key interest rate and to explore other ways to revive economic activity.We've cut that board off eleven times and it's still too short.
UPDATE: But this might be worth it:
2008: Ford Motor Co said on Tuesday it expects overall and North American automotive business pretax results to break even or be profitable in 2011.There is often a vague cloud on long-term planning flowcharts that should be marked "Here a miracle occurs." It's a mistake to fill that in with a date.
2007: Ford said it was on track to meet its goal of being profitable in North America and in all of its automotive operations by 2009.
2006: Ford Motor Co. said it was on track to meet its goal of making its North American auto business profitable by 2008 and remained committed to that target.
(hat tip: Mish)
Tuesday, December 02, 2008
Barack Obama, who promised last week to write a "new chapter in America's leadership" on the environment, could find his hands tied by the economic crisis, a leading figure in global climate change negotiations said yesterday.It has always been an argument of the right* that treaties like Kyoto would cause a depression in developed nations by making the production of goods, and even electricity, too expensive. Such fear has been fed by gentlemen like candidate Obama who famously told the San Fran Chronicle that his environmental policies would bankrupt the coal industry. They will do no such thing, because if the current economic troubles have taught us anything, it's that there is no group with a lower tolerance for economic pain than politicians.
John Kerry, who will lead the US Senate's delegation to the UN's climate meeting in Poznan, Poland, next month, said ... Obama's administration would be constrained by the economic crisis in offering incentives to countries such as India and China to commit themselves to lower greenhouse gas emissions.
Even before President Reagan famously asked Americans to judge him by whether they were better off four years prior, politicians have been judged primarily by pocketbook issues**. Were Obama to pursue a course of action that purposely*** created a significant economic downturn here, he would be tossed out on his tail faster than you can say "President Palin." That John Kerry is purposely lowering expectations in light of the current financial troubles - the same kind of troubles that would be wrought by another Kyoto - is evidence enough that political priorities are not one change we should look forward to.
* and perhaps a hope of the progressive left
** when they are the issue. When everyone is fat, dumb, and happy, then we argue over who has the best plan to save the earth.
*** one can argue that Bush and Congress' desires to put everyone in an overpriced home of their own is a significant cause of the current mess, but it's hard to argue they desired - or foresaw - this result.
Monday, December 01, 2008
More damning would be a critique that suggested [this] policy response has been flawed from the outset...Excellent article, and not the last I suspect that will challenge not just this FED program or that, this Treasury purchase or that, but the entire approach of Bernanke and Paulson*. The main problem of these economists - mechanics as they envision themselves - lies in the assumption that the economy is a big machine that the government has the power and responsibility to keep humming.
"Panicky slashing of interest rates a year ago was wrong: lower rates operate by encouraging more credit – just what was not needed. Instead, with Wall Street bulls still rampant, undermining the dollar led to bubbles in oil and food prices, which together contributed to a 2% rise in price inflation in the year to 2008Q3 – equivalent to a 2% global sales tax."
Dumas's argument is that household debt has to come down. Interest rate cuts do not contribute to this process of de-leveraging...
Of course, the government can and does have an impact on the day-to-day workings of that huge network of transactions that make up the economy. Its rules, its spending, its interest rates all marginally affect other transactions, but at the bottom, the economy remains a network rather than a machine. And when a network develops a problem, the solution is not to ram into it more power, but to discover the problem and at least try not to make it worse.
So far, the mainstream economic response to the debt-created tear in the network has been to treat it like a plugged gas line, which could conceivably be cleared by ramming more gas through it at high speeds. Trying to get banks to lend to over-indebted consumers, trying to buy up worthless assets to give banks room to create more, trying to "save" heavy industries that are creating products no one wants or needs, are all pumping gasoline into the machine in vain hope that it can start running again of its own accord.
What they have accomplished, unfortunately, is spraying gasoline over the whole thing and setting it alight.
UPDATE: it ain't over...
U.S. Treasury Secretary Henry Paulson said on Monday that more programs are being developed to stimulate lending but warned a severe financial crisis is stubbornly persisting.Perhaps Obama could find a fat lady for the next Treasury Secretary.
* which is also the approach most likely to be taken by Obama's advisers, at least until they too discover that it doesn't work.
The most striking characteristic of [Obama's] current lineup is how the personalities reflect the centrist vision of the Democratic Party promoted by Bill Clinton and his colleagues at the Democratic Leadership Council in the 1990s.One of the funnier things about this past election was how no matter who won, their core supporters were likely to be "surprised and upset" with the winner's choices, both in personnel and in policy. And while it was obvious to everyone but McCain's conservative supporters that McCain was no conservative, it probably comes as a surprise* to liberals that Obama is more mirror than light bulb: they saw their own liberalism reflected, not Obama's radiated. Obama is as liberal as he needed to be to get elected in Chicago, but not a lot more.
Obama has called on experts who aggressively promoted globalization and deregulation on economic matters, pushed for welfare reform, and accepted the necessity of military force and a strong defense. There are exceptions, but overall thus far, it appears Obama will be advised from the center.Some of Obama's core supporters are surprised and upset with his choices...
That doesn't mean he's the reincarnation of Barry Goldwater, of course, and it doesn't mean he's not in sympathy with a lot of progressive "solutions." But what it most likely means is that "Change" is going to turn out to be "change back," and that about 10 years. Those progressives who opposed globalization, who hated WTO and NAFTA, who disliked military excursions all over the globe, and who believe that markets require the ubiquitous hand of government in order to assure fair outcomes, are going to be very disappointed indeed.
It may turn out, after a symbolic burst of "saving" a couple of heavy industries, that Obama socializes far less than George Bush did.
UPDATE: for those of you who waited all weekend with bated** breath for an update, my apologies. It appears that a flu bug smuggled its way into our little Thanksgiving/Christmas celebration, and of all the people in my house for the weekend (more than a dozen), only one sister-in-law and my daughter Jaley managed to escape its rather unpleasant and insistent giftgiving.
* In a David Souter sort of way. When you elect or appoint a blank slate, you never know what will eventually get written in.
** Or baited, I suppose.