Failing at capitalism does not automatically make one a socialist.
Default Settings: The combination of low wages and high consumption built the massive debt that fueled the bubble. Salvation lies in an equal period of higher wages and lower consumption. Today's prize goes to the reader who can lead us to that promised land of unlikely outcomes.
The Fire Next Time: The overburden of dead and dying trees in the forests of the Northwest - the handiwork of pine bark beetles encouraged by global warming - suggests that massive and prolonged forest fires loom in the near future.
Porn O'Graph: Credit where credit's over-due.
Improbable Event: Some estimate that it will take 17 years for the US to rid itself of its 35% ($12.5 billion) ownership of GMAC. Hands now, how many of you believe this is going to happen?
Un-warranted: Old National Bancorp of Evansville, IN, paid the Treasury $1.2 million to retrieve warrants worth $5.8 million from TARP. How is this fair to the taxpayers?
Where do the Joneses live? Folks in Miami carry an average balance on their credit cards of $9,800 - 22% of their income. Tampa, Los Angeles, Jacksonville and Orlando are all above 16% of their income. Notice a trend here?
Missing the Point: There's a growing debate over the future of personal transportation in the US between plug-in hybrids and fuel cell vehicles. The real debate should start with the conviction that hauling around 3,500 pounds of car to move 200 pounds of people probably isn't the optimum solution.
Suffer the Little Children: Bringing California's budget under control may require completely eliminating the state’s medical insurance for low-income children, the welfare program for families and assistance to college students.
Surrender: Eventually the true cost of money will surface, for if the world is a riskier place, the cost of borrowing should rise. If governments are competing with each other to borrow large amounts of money, its price should rise. Sooner or later interest rates will rise, and the violence of the upheaval will be proportionate to the suppression.
Marks & Markers: The top holders of US debt are: China ($767 bn), Japan ($686 bn) and then it falls rapidly to Russia ($138 bn), the UK ($128 bn).
Menu: Interest on ten-year Treasuries jumped 10% last week to yield 3.45%. By September the Treasury has to sell $900 billion in new bonds. Despite Mr. Bernanke's belief in his ability to hold borrowing rates down, there's a lot of suspicion that the free lunch isn't going to be free. "There isn't enough capital in the world to buy the new sovereign issuance required to finance the giant fiscal deficits that countries are so intent on running."
Failure: California is the 8th largest economy in the world. It should not be having a budgetary crisis. But this not a budgetary crisis, it is a political crisis - California's political system does not work. What’s really alarming is the chance that California’s political problems are a preview of the future for other states and the US as a whole.
Farm Teams: Torture? Not the US. Now the US only provides the intell to enable others to arrest and interrogate mid-level suspects. Oberfeldwebel Schultz is in charge of the operation.
Porn O'Graph: The unemployed don't play the market.
4 comments:
RE: Menu....."There isn't enough capital in the world...."
We is done. The house of cards built on pretend money has exceeded anything that might be remidiated with 'real' money. I guess that means we are TBTF and it's time to throw the board up in the air and start a new game.
This is good timing, as the fires, the warming, the peak, and the 2012 end of times are all ready to go. Will there be a DVD available?
TT - When we start a new game, is there a new version of economics that will function in a low or no-growth world? An economics of sustainability, of a steady state, resource restricted, no-externalities world?
ckm
Re: Where Do the Joneses Live...
Here's where it really gets scary:
The Forbes study on which this story is based DID NOT take into account that 40% of credit card users pay their balances in full every month. Now in some of these 20 cities surveyed, that percentage may be less, so let's say 33% pay balances in full every month.
Which means the true average balances of the other two-thirds of the debt slaves are more like $15,000 or about 33% of mean annual pre-tax household income.
Yet some still think consumers will lead the country out of recession...? Wait until the big credit card companies really start raising interest rates. They now have nine months to do so, before the new CC rules kick in. As in right after the 2009 holiday shopping season, or what henceforth will be fondly remembered as "the consumers' last stand."
Farm Teams: Torture? Not the US. Now the US only provides the intell to enable others to arrest and interrogate mid-level suspects. Oberfeldwebel Schultz is in charge of the operation.
Canada is well known as a Minor League Farm Team for the US. Despite the fact that the Rule Of Law is daily debased in the West, the West is now outsourcing its "justice" to other Nations, in this case, Canada outsourcing Pirate prosecutions to Kenya:
"ABOARD HMCS WINNIPEG - Canada is actively seeking an agreement with Kenya to prosecute suspected Somali pirates arrested by Canadian warships, Defence Minister Peter MacKay said Thursday.
Following a tour of the frigate HMCS Winnipeg, Canada's contribution to a NATO anti-piracy task force in the Gulf of Aden in the Arabian Sea, MacKay said negotiations are underway between a number of interested nations and Kenya to get the east African nation to prosecute pirates arrested in the act of attacking commercial vessels.
"We're working through diplomatic channels with countries here in the region, most notably Kenya, as other countries have been able to do to establish a means or a process to prosecute those who are involved in piracy here," MacKay told reporters."
http://www.dose.ca/news/story.html?id=1617277
Often Canada acts as a stalking horse and flunky for the US. What next, Mafia to get CONTRACTS? Shame on Canada for allying itself with the US and its ongoing War Crimes.
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