The euphoria over falling oil prices sounds
a lot like nervous giggling.
Fudge: OPEC says Saudi May production was 9.15 mbd, the EIA says they produced 9.4 mbd. OPEC claims total production for May was 1.5 million barrels a day less than the EIA claims. Who's making the brownies?
The Profit : Back in 2006, Nouriel Roubini came out of his Ivory Tower and made a bunch of predictions, which no one took seriously. Go back and read them. The first half have come true. We'd better pray to whatever gods there are that the second half do not.
Horse and Cart: It is anticipated that by 2050 - 40 years away - population will increase by 50%, food demand will increase by 100%, and arable land will fall by 50%. How they gonna do that?
Door #1 or Door #2: Investment firms seem to have but two options: Dump the bad loans for whatever they'll bring - even 17 cents on the dollar, but report it in ways that seem more like 85 cents on the dollar. That's the Citigroup/Merrill Lynch approach. The other is to hold on the trash, praying that one day soon the dross will turn to gold. That's the approach taken by Lehman and JPMorgan - the willing suspension of disbelief. And was also Bear Stearns' approach, but we don't want to talk about that.
Privatization: It's not just military support activities in Iraq that are getting privatized, nor the State Department's security, nor the Border Control's fences. Privatization has come to the Treasury, too. Morgan Stanley has been hired to tell the Treasury how shaky Freddie and Fannie are and how the government should go about rescuing them
Strategy: The Long War against Everybody, begun back in 2002 and going strong today, will be going on for the next 20 years or more, with two or three or more Afghanistans at a time, everywhere. And that will take lots and lots and more and ever more tax dollars. Which is the whole point. Bachman Turner Overdrive warned us.
Same-old Same-old : Foreclosures are up 55% from a year ago. Sales of existing houses fell 16% from 2007 to a 10-year low in the second quarter, while the median price of a single-family house fell nearly 8%. Falling sales, falling prices, falling consumer spending, mortgage rates up, one-third of all house sales in the quarter were foreclosed units or sales that lenders lost money on. The stock market rose again today.
Priorities : As the world's economies slow, any 'extra' funds that might have gone into R&D to counteract global warming are drying up, while the production of CO2 continues apace. We apparently have decided it is too costly and too much trouble to build lifeboats.