SAR #8304

It costs more to lose a war than it used to.

Taking the T-Bird Away: Credit card companies have decided to make the recession deeper and longer by cutting back on the credit extended to cardholders. In that the US economy only functions by plunging consumers ever deeper into debt servitude, this is not good news.

Darwinian Economics: Continuing our trip to 1930's Italy, the government -under the cover of Paulson's TARP - is deciding which companies (banks, insurance companies, car companies, pizza parlors, organic farmers) get life-saving cash infusions and which get kicked into the gutter to die.

Too Oily to Tell: Last month China increased its crude imports by 46% over the previous September. India's imports of crude were up 17%. If this continues, it's a good thing the rest of us are on a diet.

Starecase: Since the 1880's the average S&P's trailing 10-year P/E ratio has been 16.3. Every major recession has resulted in P/Es falling below 10 for an extended period of time - lasting decades, not years. The daily ratio is now a bit below 15, but it will take months, if not years, for the long term average to approach 10. May not be a Fat Lady, but it ain't singing, either.

Walks Like A Duck: GMAC wants to become a commercial bank. Don't see why not, they sure have made a lot of bad loans.

Doctrine 2.0: Bush doctrine 1.0 called for preventive war - attacking those who might be thinking about attacking the US. The 2.0 upgrade calls for dropping bombs on and killing citizens in countries at random, ignoring international borders, sovereignty and all that old Peace of Westphalia stuff. If they complain, that's proof they were doing something.

Mary Sunshine: Roubini sees the S&P500 falling another 30%. He's getting optimistic; the note on my bulletin board reads 450.

Tab A in Slot B? Magazines are full of What You Can Do To Save The Planet stuff, which mostly involves around biking to work and buying screwy light bulbs. The real need is a program for What We Can Do As A Country, uniting behind giant, expensive government programs - and Drill Baby Drill is not one of them.

Clamming Up: The oceans have been slowing global warming for several centuries by absorbing excess CO2 from the atmosphere. This has made the ocean progressively more acidic, threatening shelled creatures and thus the whole chain of marine life.

Yes, But... A leaked draft of the IEA's World Energy Report says that global oil production is falling much faster than was predicted. Massive investments will be needed just to replace the 6 mbd (9%) that's being lost to depletion. The current economic slowdown will give the industry more time but less cash with which to develop new and alternative sources. The IEA says the leak was unauthorized. It will be interesting to see how much cheerier the 'official' report is, come mid-November.

Ketching Up: The lab boys have stuck some snapdragon stuff inside tomatoes and made them so good for you you'll need a prescription.

De Fault Is: The US Treasury, between the deficit, the wars, the bailouts and Fannie and Freddie's losses, will have to raise about $2 trillion next year. While it has long been clear the US will never repay its debts, the point is fast approaching when it will have to borrow to pay the interest due. Default or devaluation, which will it be?

Porn O'Graph: Exactly how miserable are you?