Wednesday, February 11, 2009

SAR #9042

"The sky is falling" is now considered a reasonable opinion.

Please Explain: The market greets a $1.3 to $3 trillion bailout of Wall Street by falling 360 points. It was too much? Not enough? Oh, right, it's the salary cap for executives.

Job Performance: GM is cutting 10,000 salaried jobs and reduce other salaried workers pay by 10% so it can meet the government's bailout terms. Wouldn't you love to see Citibank and BofA make the same announcement?

Turning Up The Heat: Scientists, having overcome their reticence of late, now warn that our responses to date and those now being planned are not sufficient. Studies since the last IPCC report show that global warming is accelerating far beyond old expectations. The sea is rising faster, ice is melting faster, CO2 levels are rising faster, permafrost is starting to melt, the oceans are growing more acidic and are absorbing less CO2. It is not a case of "can we keep it to only a 2ºC rise?" but rather, can we survive a 4ºC rise? Do we really want to find out?

Mumbo Jumbo: JPMorgan says prime-jumbo mortgages are going belly up twice as fast as previously predicted.

Tact: In a gentlemanly attempt not to scare the women and children, former economic advisor to the British Treasury Edwin Balls proclaims "this is becoming the most serious global recession for over 100 years." Wouldn't do to use the 'D' word in polite discourse.

Women and Children Bankers First: Ignoring Fact #1, which is that US banking system is insolvent and needs to go bankrupt, Geithner sets out to save the banks by (1) giving the banks a lot of money - lots more than they're worth, (2) not telling them what to do with it (3) helping the rich buy banks' bad assets by guaranteeing their losses (4) giving banks $1 trillion to lend to overextended people, and (5) praying for a new bubble.

Needs Work: the 60-story John Hancock tower is facing foreclosure and is scheduled to be auctioned off next month. Might be a good location for a used book store & laundromat.

Proportion: Japan's economy is contracting at a 12% annual rate, Spain's unemployment is at 14.4%, Ireland lost 36,500 jobs in January - that's as if the US lost more than 2 million last month. Canada lost 129,000 jobs in January - the equivalent of 1.2 million in the US.

Quelle Surprise: Another application of the same ineffective nostrum did not cure the market. What did you expect?

Causation: As the climate models predict, global warming has produced a 12 year drought in southern Australia. (After 12 years it begins to look like a permanent change in climate, not a drought.) The models also predicted an increase in windstorms, which came just in time to drive the worst firestorm in Australian history. For the record, the worst polluting coal-fired power plant on earth is in Victoria.

Just Say No: Just as a 40-year-old woman has an increased risk of bearing a child with Down syndrome, 40-year-old men have an increased risk of fathering a child with schizophrenia, and a 6 times greater risk of his child being autistic. And the older the riskier.

Silly Questions: Why isn't there more consensus among economists? Will the government's rescue plans work? Why can't we all get along? Why is there broccoli?

You Are Poor, Too Bad: That's the message behind the unbelievably stupid stories about how no one can possibly survive in NYC on less than $1.3 million a year, certainly not on just $500,000. Tell that to the people who clean the offices, pour up the coffee, dance at ABT... No wonder some of executives get around in armored cars.

Credit Scare: If you stop shopping at Macy's and start running up the bill at Wal-Mart, your credit card company may think you've become a worse risk, cut the limit and increase the rate.

Do Not Pass Go $200 Billion: Fannie and Freddie now need another $200 billion. Notice how all the Fannie/Freddie, Treasury and Fed bailout stuff, trillions and trillions, just glides along, and $35 billion for alternative energy gets everybody upset?

Porn O'Graph: It's a capital idea, bank on it.

10 comments:

cc said...

Regarding "Needs Work", how about converting it to luxury condos?

Anonymous said...

RE: Porn O'Graph

The only way to fix the banks is to put them in receivership, replace the management, sell all the assets and than re-privatize the bank if someone wants it. This is what we did with the S&L's through the RTC. It worked and it was relatively cheap. The reason it is not done with our current big 6 banks, which are insolvent, is that many if not most fixed income retirees, PIMCO, and virtually every pension fund owns massive positions in their preferred stocks. Which politician is going to suggest wiping out everyone's retirement.

Anonymous said...

Needs Work: the 60-story John Hancock tower is facing foreclosure and is scheduled to be auctioned off next month. Might be a good location for a used book store & laundromat.

Yes, it may need a lot of work, these problems usually do not improve over time:

"It was a much-anticipated landmark from the country's most respected design firm. Unfortunately, the tower was once more notorious for its engineering flaws than for its architectural achievement. Its opening was delayed from 1971 to 1976, and the total cost is rumored to have rocketed from $75M to $175M. It was an embarrassment for the firm, modernist architects, and the architecture industry.[citation needed]
[edit] Foundation

Hancock Tower was plagued with problems even before construction started. During the excavation of the tower's foundation, temporary steel retaining walls were erected to create a void on which to build. The walls warped, giving way to the clay and mud fill they were supposed to hold back. The inward bend of the retaining walls damaged utility lines, the sidewalk pavement, and nearby buildings—even damaging the historic Trinity Church across the street. Hancock ultimately paid for all the repairs.

[edit] Falling glass panes

Inventing a way to use the blue mirror glass in a steel tower came at a high price.
Soon after the building was completed, windowpanes began detaching from the building and falling to the street below. These were temporarily replaced with plywood.

The building's most dangerous and conspicuous flaw was its faulty glass windows. Entire 4' x 11', 500 lb (1.2 x 3.4 m, 227 kg) windowpanes detached from the building and crashed to the sidewalk hundreds of feet below. Police were left closing off surrounding streets whenever winds reached 45 mph (72 km/h). According to the Boston Globe, MIT built a scale model of the entire Back Bay in its Wright Brothers Wind Tunnel to identify the problem. The exact cause of the malfunction was never revealed due to a legal settlement and gag order. Most now diagnose the problem as a combination of the double-paned glass construction method, and the pressure differentials between the inside and outside air.

In October 1973, I.M. Pei & Partners announced that all panes would be replaced by a different heat-treated variety—costing between $5 million and $7 million. During the repairs, plywood replaced the building's empty windows, earning it the nickname Plywood Palace and the joke that it was "the world's tallest plywood building".

[edit] Nauseating sway

The building's upper-floor occupants suffered from motion sickness when the building swayed in the wind. To stabilize the movement, a device called a tuned mass damper was installed on the 58th floor. As described by Robert Campbell, architecture critic for the Boston Globe:

Two 300-ton weights sit at opposite ends of the 58th floor of the Hancock. Each weight is a box of steel, filled with lead, 17 feet (5.2 m) square by 3 feet (0.9 m) high. Each weight rests on a steel plate. The plate is covered with lubricant so the weight is free to slide. But the weight is attached to the steel frame of the building by means of springs and shock absorbers. When the Hancock sways, the weight tends to remain still... allowing the floor to slide underneath it. Then, as the springs and shocks take hold, they begin to tug the building back. The effect is like that of a gyroscope, stabilizing the tower. The reason there are two weights, instead of one, is so they can tug in opposite directions when the building twists. The cost of the damper was $3 million.

The John Hancock Tower seen from the Prudential Tower; on the left is Copley Square (and Trinity Church), to the upper left is the Boston Common, on the right is the Massachusetts Turnpike (I-90) and to the top right is Logan International Airport.

The dampers are free to move a few feet relative to the floor. LeMessurier Consultants says the dampers are located in relatively small utility rooms at each end of the building, leaving most of the 58th floor usable.

According to Robert Campbell, it was also discovered that—despite the mass damper—the building could have fallen over under a certain kind of wind loading. Ironically, it could tip over on one of its narrow edges, not its big flat sides. Some 1,500 tons of diagonal steel bracing were added to prevent this, costing $5 million.[1]"

http://en.wikipedia.org/wiki/John_Hancock_Tower

Located in historic Boston, home of the famous Infrastructure Poster Boy, BIG DIG!

JES said...

I wish that global warming researchers would stop being such wusses in the way they talk, and realize that if they insist on being mealy mouthed about their message, ordinary people are going to ignore them. They buy into a really dumb game. Point in case, if you tell 100 people that the average temperature will be 4 degrees hotter from now on, 99 of them will say something like, "Well, that's ok. That means we'll have a few more days in the summer where I turn on the cooler, but I won't have to shovel so much snow in the winter."

CKMichaelson said...

JES - Absolutely. But it's not that the scientists are being mealy mouthed; they are talking like scientists and don't understand why the rest of us don't understand the seriousness of our peril. (I know, I've got 3 of 'em in the family).
Jay Hansen is the only one who has figured out that we and they do not speak the same language. But soon, I hope, they will start protraing what 4 degrees means - as in pretty much we're doomed as the economic and cultural civilization we're used to.
That's also why I keep thumping the drum - even though it garners me more crank mail than anything else I bitch about.
ckm

Anonymous said...

in response to Bankers First:

Well, we know were some of the money went. To Spain.


from
http://www.thenewspaper.com/news/26/2613.asp

Bailed out Citigroup fund spends $10 billion buying 44 foreign toll roads.


Just one week after receiving a pledge of $306 billion in support from US taxpayers, Citigroup announced the intended $10 billion acquisition of a debt-laden Spanish toll road group. Citi Infrastructure Partners will hand over $3.6 billion in cash and assume $6.3 billion in debt from Sacyr Vallehermoso

fajensen said...

It is not a case of "can we keep it to only a 2ºC rise?" but rather, can we survive a 4ºC rise? Do we really want to find out?

Average temperatures have taken larger jumps than that before.

Many, Many times. So many times that one might even consider it Normal ans call it Climate!!

CKMichaelson said...

fajensen - Let's keep the science in scientific comments. The fastest warming that homo sapiens has experienced was at the end of the last ice age, when the temperature warmed about 1ºC (1.8F) per thousand years. We are now experience a change that is 30 times faster. The last time temperatures were 3ºC warmer than today was 3 million years ago. The sea level then was about 80 feet higher than today. Global average temperatures may have taken larger jumps before, but not in the last 15,000 years, and never as quickly. A 2ºC rise is not 'normal' - it will be seriously difficult for civilization to adapt to -and a 4ºC global average rise is disaster.
Please read some science based climate change journals and books, or some scientific commentary with appropriate references such as Climate Chronicles (http://climaticidechronicles.org/) or better yet Climate Progress (http://climateprogress.org/).
ckm

fajensen said...

CKMichaelson: I am sorry for being cynical even about "climate change" but it is one of the character traits than one acquires after too much exposure to People!

I don't doubt the science (much!) but I absolutely doubt the motivation of the agencies involved in proposing "solutions" to the climate change. I have three objections - or rants if you prefer.


From my point of view the "climate change" movement is yet another expression of Transnational Progressivism, and the most dangerous so far - because this time the Tranzis might actually get their hands on some real money via carbon taxation!

All the proposed solutions push the Tranzi-agenda that "the nation-state and the idea of national citizenship are ill suited to deal with the global problems of the future." - therefore "we" must "create a supra-national agency with authority to act" i.e. a World Government; with armies - for enforcement of The Law.

Should "they" succeed we will all experience what life is really like when individuals have no rights or purpose except the ones that are aligned with the world-governments objectives. We won't even have to move to Saudi or North Korea!

Therefore, I hope they fail preferably in an epic and humiliating way!


I also object to the lunatic and deadly idea that humans should manage the climate that grows logically from the "CO2 as the only driver of climate badness". My reason is that the climate is a networked, chaotic system which we do not understand fully.

The human track record on managing networked systems is just not that good: Recently we experienced an epic failure in managing another networked chaotic system, the economy, which we DO understand since we constructed it!

Should "we" decide to pull the same stunt with the climate I think that the consequences will be much worse than the current inconvenience.*


Finally, On the real issue, that of preserving a liveable environment, I think the following:

IF one REALLY wanted to do something for the planet then focusing all effort on reducing CO2 emissions is absolutely not useful. The only* immediately measurable benefit of cutting fossil use significantly will be the collapse of several evil dictatorships in the middle east and underfunding of international terrorism.

Instead Consumption In General has to be reduced, which means Growth has to be reduced.

The growth rates is the driver for yanking more precious resources out of the earth each year and turning them into landfill material ever faster - so fast that we might regret no spending them wiser, later, when we are more mature. Maybe around 2030 at 2007 "growth" rates!

And what exactly *are* "we" doing on that front:

The US is pushing *every* button possible to restart an "economy" based on 70% consumption funded by geometric expanding debt; The rest of the world is running interest rates at a fraction of what they should be to make it affordable to turn those pesky resources into junk NOW instead of later (and before anyone else, especially the natives, get their grubby mitts on them).

I.O.W. Nobody wants anything to change, they just want to use "climate change" to position themselves in the flow of power and money.


I cannot easily ignore the hypocrisy in setting up this whole useless, fraudulent and corrupt supranational structure around CO2 when the eventual outcome will be at best Nothing because there is absolutely no will to do anything different present.

CO2 credits are just the same old tried and tested "pay the church and your mothers soul will be released from penitence (while we pocket the money)"-game!


*) Yes, I Know - dumping GT of CO2 into the ecosystem will probably change something also so we should refrain from it and embrace the consequences (lower growth, pet dictators bust, millions dead, e.t.c. - but we won't).

**) If I was in command, I would reduce fossil use for that reason alone! Without the middle east influence what would our armies and diplomats do? Billions of DKK instantly saved so we can waste them at home instead on people that appreciate it ^^.

CKMichaelson said...

fajensen: Glad to see we're essentially in agreement. The odds of achieving the global cooperation necessary to reverse global warming, design an sustainable economic model, or reverse the humanity's suicidal population growth are pretty much on the order of 6.7 billion to 1 today and getting steeper.
Doesn't mean trying to build a map of the territory won't be useful - if only because it'll give one the right to say 'I told you so.'
ckm