SAR #8334/Weekender

The purpose of money is to reduce violence

in the marketplace.

Simple Arithmetic Nowhere in the reporting on the deadly assaults in Mumbai is there any mention of the fact that 46% of Indian children under 3 are malnourished. There's a lot more data, but that's explanation enough.

Ocean-view Apartment: If you stand on a chair and lean out the window, you can just see a sliver of the ocean from here. My landlord calls it an "ocean view apartment." Obama says the same thing about the change; he's just going to use the centrist, experienced (recycled) Clinton and Bush folks as a chair, so he can see the ocean of change once in a while. He promises .

Earmuffs? With 70% of its gas fields in decline, Russia may not be able to service domestic gas needs by 2010. The EU currently gets 40% of its gas from Russia.

One Step Further: If retailers have the disastrous season that is popularly forecast, what happens to all the empty malls? And the debt that built them? Where will the unemployed gather to dream?

Limbic System: Now that the immediate threat is seen to be the economy, plans to cut greenhouse gas emissions are being shelved. Humans are still looking across the savannah for lions.

Talking Points: Robert Shiller wants to make sure you understand: (1) House prices are falling faster and farther than in the Great Depression. (2) The Treasury last held interest rates at zero in the GD. (3) Consumer confidence is as low now as in the GD. (4) Asset bubbles take as long to deflate as to inflate. The current round took well over 7 years, closer to 20. (5) Bad things will happen

Stealth Flighters: GM has asked the FAA to block the public's ability to track the flights of their planes. Lots of luck; remember those secret rendition flights?

Ingreedyents: Just because commodity prices are falling doesn't mean food prices are. Or will. They are expected to be up about 6% for 2008 and go up another 4% or so in 2009, with the largest increases in meat and poultry and the largest decreases in package weights.

Attention to Details: The Housing bubble was a Ponzi scheme. So is the American Empire. All Ponzi schemes eventually collapse.

Bankruptcy for Idiots: The CDS spreads on British debt jumped even higher on Tuesday, touching 100 at one stage. In the US: Michigan -192; California -165; Nevada - 164; New Jersey - 150. CDS on US bonds are at 56 basis points. Neat, you can buy insurance on US debt that will pay you dollars if the US fails. Financially that's like buying insurance on the end of the world.

Ripley's: The scurry to safety reached a crescendo this week as the yield on ten year Treasuries fell below 3% for the first time ever.

Four Strikes and We're Out: Jobless claims remain at recessionary levels, consumer spending fell 1%, factory orders plummeted, and home sales fell to the lowest level since 1991. Citibank stock rose by over 50%; the bailout's working!

Three Times and Out? The recidivism rate on modified mortgages is approaching 50%, which suggests that there is a large group out there which is never going to learn to swim and should never have been let near the pool to begin with.

True or False: If Detroit’s Big Three go bankrupt, the perfect storm really will have arrived with a collapse of both the real economy and the financial sector. True. Foot bone connected to the leg bone...