- Citibank Visa Ad, 2008
Buckets: The Bank of England is offering British banks unlimited cash, starting with $100 billion, and unlike the Fed's pretense of '30 day renewable' loans, they're starting out with a one year term. Banks can put up any debt - and BoE will accept it at face value, even if it last traded for 20 pence on the pound. Question: How, in a year, will a bank be able to buy back bad paper at 100% when it's not worth near that now and declining every day? And why would they want to? "The UK financial system remains fundamentally strong..." Yada yada...
Fuel for thought: Oddly enough, the largest use of natural gas is in petroleum refining. The second largest use is in making fertilizers; 97% of fertilizer applied to US crops is made from natural gas. But natural gas is so expensive fertilizer manufacturers make more selling their fuel than making fertilizer. Another contribution to soaring food prices.
Tofu Too: Research shows that genetically modified (GM) soybeams produce 10% less harvest than conventional seed. Less for more, in more ways than one.
Shaken, Not Stirred: There are two engines that drive the world's oceans: an area near Greenland and an area near Antarctica. In these places, heavy salty water sinks to the ocean bottom, drawing the surface waters towards the poles. If the surface waters were to become less salty and lighter, they would stop sinking and the great ocean conveyor belt would stop. Climate chaos would ensue. We thought you'd like to know that the surface water in both areas is freshening.
O Brother, Where Art Thou ? Until we see people like Bush, Cheney, Paulson, Greenspan, and Bernanke in orange jumpsuits the only change we'll see is more families in soup kitchen lines.
Rescue Me ! Cleveland's National City Bank is the 10th largest in US with a market value of $5.3 billion. It is raising $6 billion by issuing shares at $5, even though National's stock was at $8.33 . That's a 40% drop, overnight. National's shareholders are used to it - the stock is already down 78% in the last year.
Stormy Weather: The jet stream is slowly weakening and moving northward. That means even less rain for the South and more storms for the North. It might also lead to stronger hurricanes. Global warming may or may not be implicated.
Spiral: California is looking at at least an $8 billion budget shortfall as both housing nd employment stumble. California's unemployment rate (6.2%) is the third-highest behind Michigan with 7.2% and Alaska with 6.7%. California is worse than the Rust Belt.
Marching On: Wall Street cheered when retail sales for March were reported to be up 1.8%. But the increase in sales consisted of an 19% rise in gasoline sales, 4% in food and 4% in health care. Everything else was down. Unless you actually used 19% more gas and 4% more food and health, this wasn't an increase in sales, just another increase in costs.
Blue Moon: A US attack on Iran would be an act of sheer lunacy. It would isolate the US in the world, drive the price of oil towards $200, alienate the entire Middle East, ruin Bush's legacy, and condemn the world to living out the script of a very bad sci-fi movie. Odds are better than even that Bush will do it.
Progress: In the 1950's coal power plants returned 30 times the energy it took to mine the coal burned. Today it is about 3 to 1. Soon we'll be better off not mining the coal.
Carded: An index of subprime derivatives values implies that 9 out of 10 subprime mortgages are expected to default, with investors getting zero back. Financial markets have fully priced in a 50% default rate and a 50% correction in US home prices. 'Correction' in the sense of Department of Corrections.