We have no shortage of either mendacity or stupidity.
Fun with Numbers: Various political blocks are giving a variety of conflicting estimates of the cost of the December Compromise. They are at best guesses and at worst contrived figures to make a political point. Truth is no one really knows, although most of us suspect it will end up costing far more than anyone claims and do far less good than anyone hopes.
Hour Price : Some see oil at $90 a barrel as about as high as oil can go without dooming an economic recovery. Higher oil prices diffuse throughout the American economy because little if anything is immune from either direct or indirect oil price increases. $90 a barrel oil may not doom the rumored recovery all by itself, but it most certainly is another brick in the wall.
Ransom: Halliburton is negotiating with Nigeria to keep its former CEO & former US vice-president (emphasis on the vice) out of jail. The price is said to be half a billion dollars. Sorry, I gave at the office.
The Lesson: “The more that countries reduce wages and costs, the heavier their inherited debt loads become. And, as debt burdens become heavier, public spending must be cut further and taxes increased to service the government’s debt and that of its wards, like the banks. This, in turn, creates the need for more internal devaluation, further heightening the debt burden, and so on, in a vicious spiral downward into depression.”
Cashing Out: Corporate America is sitting on the largest cash hoard it has had in 50 years, because they can see no profit in building more plants or hiring more workers or making more widgets. If a company cannot justify investing its own money back into its own operation, why should I buy stock in it?
Everything You Know is Wrong : Last month US exports increased, imports decreased – except for consumer goods. The cheaper dollar (down 6.6% against a trade-weighted basket of currencies) helped the exports, hurt the imports.
A World Built By Hand: Missed in all the statistics about the fall of the housing industry is the effect it is having on those who actually build the houses. No, not the big developers, but the carpenters, sheetrock hangers, electricians and the other laborers. A typical housing laborer used to make $150 a day or more. Today $60 is a good day's pay. Wonder how that affects quality...
Beggars: One of the lessons a traveler learns from visiting places like Kolkata or Mumbai or Lagos is the art of not seeing the beggars. They are everywhere and no matter how rich you might be, you cannot save them all. So, too, with the seriously sick. Society may want to save everyone, but no society has the resources to do so. Somebody's child, somebody's mother will die for lack of a treatment that is only available to all in a magic land beyond the rainbow. Here and now we must find a way to reasonably and equitably let some die so that others, many, many others may live. Yes, stopping our permanent state of war and war profiteering would help, as would single payer healthcare and a rational tax system, but even with all that, decisions would have to be made. Today they are made by price tags. Got a better solution?
Confusion Reigns: A jumble of oil-related reports plopped down bringing mixed messages. The IEA raised its crude oil demand projection for next year by 260,000 but gave no hint where the oil might come from. OPEC's secretary-general said its members output would dip in 2011 and that if oil went to $100 it would “indicate something is wrong with fundamentals”, but maintained that oil supplies were adequate. Interesting word, adequate.
Leaps & Bonds: California, which just took some draconian steps to narrow its $26 billion budget deficit, was handed another $2.1 billion in deficit spending thanks to Obama's December Compromise. Add to that whatever amount the failure to extend Build America Bonds will drive up the cost of issuing new debt and life just gets harder and harder for the Californians.