Saturday, January 22, 2011

SAR #11022

Eloquence trumps evidence.

God & Country:  Seymour Hersh, with a long record of inconvenient investigative coups, is now reporting that a secret group of Christian nutcases has taken over much of the US military and have, in effect, “overthrown the American government” and replaced it with a fraternity of Crusading Knights Templar. Hope he includes the nuts at Colorado Springs.

Ignorance is Bliss:  The outlook for the economy does not support the market's current valuation. There is a (nicely recited) very long list of domestic and global economic issues that point to problems ahead, while the technical measures indicate a significant market decrease awaits. But the market promises more, more, and ever more; thus we dance. It is now abundantly clear that it will take a crisis far larger than 2008 to teach the necessary lesson.

Let the Good Times Roll:  “Employment won't get back to where it was. Maybe we're talking 10, 15, or 20 years to get to the really good days again.”

One Out of Two:  Several states are facing budgetary gaps serious enough that they must either receive outside help or be permitted some form of bankruptcy. The GOP controlled House is not going to provide any funding and is loath to let them enter a bankruptcy that would harm investors. Their plan will be to authorize states to renege on contractual promises to retirees and unions, yet require bondholders to be made whole. In short, kill the unions.

The Real Deficit:  About 60% of Americans want the government to cut taxes without cutting any spending.

What's Love Got To Do With It?  Representative Edward Markey (D-MA) wants an Treasury Secretary Geithner to investigate the BP/Rosneft stock swap. Mr. Geithner could begin by explaining to Mr. Markey that BP is a British company and Rosneft a Russian one and that neither of them had to ask 'May I'.

Protesting Too Much?  Another day, another hysterical attack on Meredith Whitney. The loudest of those the denying the possibility of a “massive wave” of municipal defaults seem to have skin in the game.

Devil/Details:  If the US were to embrace “Drill, baby, drill.” as an energy policy, the main result would be an emptying of reserves that much quicker, followed by a total dependency on foreign oil by about 2030.

True Facts:  “The fiscal stimulus packages put in place in 2009-10 required most countries to run budget deficits... Treasuries issued new public debt - totaling $5.5 trillion since 2008 - to pay for the additional expenditures. To keep interest rates low, many central banks monetized that debt, injecting large sums of money into the economies. Central banks will face the difficult task of containing inflation without raising interest rates so high they snuff out further growth.” CIA World Fact Book, 2010.

Say/Do:  Sixty-seven percent of Americans feel now is a “good time” to buy a house. Yet in December almost none of them did so.

Gap Coverage:  Dr. Peter Höppe of Munich Re says that “For me the most convincing piece of evidence that global warming has been contributing already to more and more intense weather related natural catastrophes is the fact that while we find a steep increase in the number of loss relevant weather events (about tripling in the last 30 years) we only find a slight increase in geophysical (earthquake, volcano, tsunami) events.”

Irony:  JPMorgan handles food stamp debit cards in 26 states, child support debit cards in 15 states, and unemployment insurance debit cards in 7 states. If you have a problem with your debit card you just call the JPMorgan service center. In India.

11 comments:

mistah charley, ph.d. said...

I enjoy a delicious, invigorating, indulgent cup of mocha as I read these signs of the times six days a week. Some days I even have a second cup. Thank you, CKM, for the infotainment.

Sky said...

Agreed, mistah charley... I too sip the cafe`slowly each morning over SAR. I usually express my appreciation via email, but your sentiments just made me realize that it seems only just to thank my favorite blogger in public, since he puts himself out there publicly 6 days a week.

So yes, thank you CKM for making me giggle with abject horror each day. My best laughs are are pretty damned dark these days, and I thank you wholeheartedly for them.

Anonymous said...

As Mr. Markey knows, and someone must explain to you, BP is the US Governments' primary worldwide military fuel supplier, including all fuel for existing active military units.

Also, as Mr. Markey knows, and someone needs to explain to you, 40% of all BP's worldwide fuel sales are in the USA.

The point is that the USA and the US government, have massive amounts of leverage to apply to the deal...including forcing BP to sell parts of itself to "domestic" US energy companies. soliz

CKMichaelson said...

If BP is "the primary source" of US military POL, who's got the leverage? And given BP existing distribution system, franchises and infrastructure in the US, a showdown between BP and the US with US drivers as the bargaining chips would make good theater.

More important is the other end of the deal - it seems to be a clear admission that the Russian partner does not have the capital nor the technical ability to exploit the resource. I'd think Putin would be more concerned than Geithner.

ckm

john patrick said...

Thanks for the writeup, CK.

Forrest said...

What every union buster seems to forget is the public retirees know just which valves to turn to break every water line in town, And, they know where the contrls are that will blow every transformer that happens to be energized. Do we really want to upset these folks by choppping their pensions?

Dink said...

Thought that I'd join MC, PhD and Sky in thanking CKM/SAR for my daily snapshot of horror ;)

I think most horrifying today was the Xtian takeover of the US military. Who needs to fear foreign governments when our own can be taken over so easily?

CKMichaelson said...

Maybe I should institute a new feature, The Daily Downer. But there'd be so much to choose from and so little agreement..

ckm. And,no, I'm not re-naming the blog.

kwark said...

Re Devil/Details The whole "drill baby drill" schtick is just one page in the Republicrat disinformation/confuse the public campaign. The "moratorium" on deepwater drilling affected only a tiny fraction of all offshore drilling. Note too that the moratorium didn't stop production from existing deep water wells. In any case, something over 90% of oil produced by offshore rigs comes from shallow water. Tempest in a tea pot but great political fodder to keep Joe Public angry about the wrong things.

Anonymous said...

Gap Coverage:

CK:
Your at it again. You know the reason. The real reason claims are up and events are stable is that the value of real estate has grown out of proportion to other asset classes added to the fact that there has been a rising insured population inhabiting high risk areas such as hurricane areas. Perhaps the insurance guys shouldn't write high risk insurance.

RBM

CKMichaelson said...

RBM If Munich Re's business was limited to US real estate there would be merit in the 'increased value' argument. But Munich Re is the world's largest re-insurer (It insures insurance companies by underwriting their risk). Dr.Höppe clearly said "a steep increase in the number of loss relevant weather events - not in the cost of the events. So the increase in value of the insured properties would be not particularly relevant.

ckm