On Fed actions: The only thing we have to fear,
is their fear itself. W/apologies to FDR.
On Order: Companies exist to make profits, not to build new factories because interest rates are low. The economy is profit driven, not cheap debt driven. Getting a bigger truck only works in jokes.
Overdrawn: A survey shows that more than one million Iraqis have died as a result of the US invasion. It was a British survey; Iraqis don't count.
Signing Statement: Attorney General Mukasey again casually told Congress that the President has the right to violate their laws and that Congress has no power to do anything about it. Go read his testimony, before it's redacted.
Add Yeast: First the Federal Home Loan Banks rescued Countrywide & friends with $163 billion in loans at bargain basement rates, now the SEC is permitting lenders to engage in misleading accounting. To quote Yeves Smith, "this society is supposed to operate under the rule of law. But it is becoming apparent on every level that it doesn't, that this is increasingly a nation of might makes right and expediency." Who suspected?
Make Believe : Another bond insurer looses its stripes: FGIC was cut two levels to AA. Fitch Rating Service has pretended that FGIC deserved an AAA rating for years. Now it wants you to pretend FGIC deserves to be AA.
Morals vs Ethics: Moral arguments against abortion do not consider the physical limits of the planet. Seen in the context of the human misery, suffering and starvation, "pro-life" favors misery, suffering and starvation. The the earth cannot support the 6 billion of us today. Think about tomorrow. In 2050, it's 9 billion.
Quo Vadis: "Another effect we are seeing is that consumers are willing to walk away from homes. We are seeing a lot of that." The CEO of Flagstar Bancorp seemed puzzled that a large number of homeowners just "go under". It's called drowning.
Snow Job : Chinese travelers are stranded by the millions, power plants shutting down for lack of coal; yet winter's worst may be the damage to the wheat and vegetable crops. When things get better, they won't be getting better.
Introductions: S&P points out that "Under accounting rules, smaller banks haven't been required to write down their holdings until the credit ratings on them fall. This has let them avoid 'recognizing' the losses. Thousands of small banks hold trillions in worthless paper." When the bond insurers finally fail, so will they.
Alladin's Lamp: India had planned to import LNG to meet growing demands, but has been unable to sign a deal for long-term supplies.
Knife Edge: Randomness, Chaos, Complexity; popular topics of late. Could one grain of sand bring the whole thing down? Last week we saw how quickly a financial burp can cause worldwide indigestion. Antacid, anyone?
Candle in the Wind : South Africa's Government is telling the public to prepare for months of blackouts. "Go to sleep earlier... Boil less water, use the microwave rather than stove, take a shower and not a shallow bath," is Energy Minister Sonjica's advice.
Thanksgiving Dinner : Saudi Arabia's December oil production was 2% above November's level, but their exports were down 2.2%. The bread on my table does not feed your family.
Someday: The energy crisis, like the climate crisis, may not hit us until 2025. If you were 21 in 1991, you'll be 55 in 2025. Ready or not.