SAR #8169

The innovative in finance is generally just a new way
to do what has already been forbidden.

Pay to Play: Electricity prices are going up about 30% this summer to cover increased costs for fuels, as well as maintain the power grid and build new plants. Don't complain, it's for a good cause.

Double or Nothing: US airlines have gone from crisis to survival mode in the last six months. If petroleum goes to $150 a barrel, the industry will have to double ticket prices just to break even. And double ticket prices will kill air passenger traffic, so to survive they'll have to raise prices some more....

Under The Mattress: The Bank of England is more than a little upset that banks are hiding money under the mattress rather than lending it out - even to other banks. It is a sign of how much the banks, and The Bank, fear that the crisis is far from over.

Rabbits/Hats: From 2004 to July of 2007, the seven big Wall Street firms had $254 billion in profits. Since July 2007 they have written off $107 billion. In less than a year these titans of finance have lost half the profit they earned in three years. Explain investing to me again, I don't think I understand.

To Scale: It is not just the cod off the Atlantic Coast or the Salmon off the Pacific that have been done in by over-fishing. Nearly 80% of the world's fisheries are at risk from over-fishing, yet governments continue to subsidize fleets that are taking the last of the fish from the sea.

More Oil! The announced increase in Saudi oil production (a) will not solve the problem – it’s only 0.4% increase in world supply, and (b) while the dollar price per barrel may fall, rest assured the political price extracted by the Saudis has been enormous – even if secret.

Showdown: A bill pending in Kuwait would require disclosure of the country's actual reserves and limit production to 1% of those reserves. Kuwait claims reserves of 100 billion barrels, but internal documents cite only 48 billion barrels. Some suspect it may be as low as 24 billion barrels. Even if there were 100 billion barrels of proven reserves, the 1% limit would cut Kuwaiti production in half.

Promotion: Nearly ten million families now have negative equity in their houses. No family member can accept a promotion that requires a transfer because they cannot afford to sell the house. Will being single become a requirement for promotion in the years ahead?

Science, Explained: Competitive Enterprise Institute climate change denier Iain Murray: "A scientist who says that the atmosphere is warming, and cites certain physical processes, is still a scientist. A scientist who argues that people must take certain acts to avoid disaster has become a priest." Similarly: A plumber who tells you the pipes are leaking is a plumber. The plumber who tells you you need to replace the pipes is a voodoo doctor.

Put It On My Tab: There is suspicion that banks are not foreclosing overdue loans because they don't want to have to recognize the losses on their balance sheets. And if they hold them quietly undr the desk, then they can eventually dump them on one of the GSEs at par. Gentlemanly fraud.

Porn O'Graph: Real Estate Index Turnaround?