We're Americans, history doesn't apply to us.
Tattle Tale: The IMF says that banks around the world and up and down Wall Street are hiding some $1.5 trillion in toxic debts that remain on their balance sheets. The unrealized losses on these bad loans “ threaten the solvency of many institutions.” The banking systems of advanced economies “remain undercapitalized”.
Just Great: Australia's Great Barrier Reef has only a 50/50 chance of surviving if global CO2 emissions are not cut by 25% by 2020. Book your trip now.
Party On, Dude: There's a very strong argument that high oil prices in 2008 were the trigger that popped the housing debt bubble. Yet Big Oil and its fellow travelers -cars, suburbia, finance, media (advertising) and politicians want us to party on, even though many know there are huge problems ahead as oil production declines. Despite prompting since 1981, we have no plan for this disaster. Once petroleum becomes scarce, today's admirable 'just in time' efficiency relying on global transportation will become unworkable.
Asked and Unanswered: How much would you pay to save the world?
Talking Their Book? Fitch Ratings downgraded Mexico's foreign debt to BBB in the shadow of its collapsing petroleum income. Goldman Sachs said this was “unnecessary roughness,” because Mexico was going to pull a rabbit out of the sombrero by increasing taxes. What Mexico has to tax other than petroleum and illegal drugs wasn't specified.
Overused: The continuing economic slide has made the term “worse than expected” expected. And rightly so in the case of the S&P/Case-Shiller house price index. Down 9.4% y/y.
Water is Wet: Opponents of health care reform keep harping about the increase in costs. Of course it will cost more – it will insure about 35 million more people, many of whom cannot qualify for private insurance because they are sick or likely to get sick. For-profit insurance companies long ago figured out they wanted nothing to do with actual sick people.
Always Wrong: Now that nearly everyone has become bullish, or pretends to be, a serious downturn is nearly guaranteed.
The Story Thus Far: If all the world's population used as much of the planet's resources as Americans do, we would need five more Earths. Luckily the huddled masses seem content to wait their turn. So we keep telling ourselves.
Tea Leaves: Stocks and commodities continue to rise as the dollar falls on the perception that record low interest rates will last until “late 2010, perhaps later in terms of 2011,” encouraging the bubble in assets to continue to move higher. Eventually the stock rally will grind to a halt as the global recovery slows, spurring demand for the perceived safety of the dollar. A minority of forecasters, those rated "most accurate" by Bloomberg, see the dollar continuing to fall through 2010, reaching $1.58 to $1.60 per euro, while the majority (of less accurate forecasters, presumably) expect the dollar to gain against the euro. Bond investors (with unemployment above 10 percent and housing taking another downturn) happily lodge their money with the government at zero interest to preserve their capital. Stock investors (with greed and hope in their briefcases) feel continued low borrowing costs and the $12 trillion in stimulus will inflate earnings and chase up stock prices.
The List: The national debt is $12 trillion. We've promised ourselves about $100 trillion in benefits we've got no chance of paying. The global temperature's going up 4 to 6ºC, the glaciers are melting and the oceans rising. Swine flu is mutating. Cheap oil is gone and the bottom of the barrel is in sight. What's to be thankful for? Besides cranberry jelly from cans.
Porn O'Graph: Build them & they'll stand empty.