Friday, February 3, 2012

SAR #12034

Economies are not exempt from the second saw of thermodynamics.

Daybreak: The BLS reports employment in January rose by 243,000, dropping the unemployment rate to 8.3%. Previous months' numbers were revised upward. “The annual benchmark process also contributed to these revisions.” Carping will resume shortly.

It Begins: Republicans are already pulling the trigger on those automatic budget cuts that were the supposed consequences of the Super-committee's failure - at least as far as defense goes. They are quite all right with automatic devastation for social welfare programs, but adamantly oppose the corporate welfare represented by most defense spending. Among their priorities is extending the two-year old federal pay freeze for a few more years and cutting the federal workforce by a third.

Them That Has, Gets: Gazprom is reducing gas deliveries to Europe in order to meet the increased demand a severe winter is bringing to Russia. They say. They also say their net profit will be up 25%. God forbid you should think the one has anything to do with the other.

We're Winning? Homeland Security, through a diligent review of its files, has managed to double the number of potential terrorists forbidden to fly to of in the US. This did not, in itself, cause AMR's bankruptcy.

Slow Bern: The Treasury Borrowing Advisory Committee says the US Treasury should permit negative rate bids at Treasury auctions. Which could make a hamburger today worth 99% of one Tuesday.

History Lesson: Some are taking the new information that volcanoes were most likely the causative agents for The Little Ice Age as suggesting that some planetary-engineering could stop the inexorable CO2 driven rise in global temperatures. The real lesson should be one of scale: The Little Ice Age was just 1ºC cooler than today, and climate scientists are promising us a rise of three or six or more degrees. This should sober a few of us up.

Memo: Nineteen of Mexico's 31 states are facing the most severe drought on record. Two million are without access to water and the drought combined with a cold snap has devestated half the country's croplands. No real relief is expected until the rainy season arrives – along with hurricane season.

Epidemic: The BLS anticipates the nation will add 5.6 million health-care/social-assistance jobs by 2020 - a 34% increase. So our GDP will grow because we have more people taking care of the sick. The BLS did not venture to guess where the money to pay these 5.6 million caregivers will come from.

See And Saw: Fannie Mae's delinquency rate (3.9%) dropped a tad in December while Freddie Mac's(3.6%) went up a tad. Both are still way above their long term – under 1% - averages.

Hidden In Plain Sight: The supposed mystery behind the long-running, sharp decline in the labor-force-participation rate - generally blamed on workers dropping out because the economy/employment conditions were terrible - now is thought to be mainly a demographic story. It seems economists have figured out that the baby boomers are retiring in large numbers. Someone should send them one of Harry Dent's books.

Situational Ethics: Google has quietly announced that use of Blogger will be limited/censored on a “per country basis.” Meaning that they'll do what it takes to make money.

Reinforcements: Following on the heels of the Case-Shiller report of a 3.7& y/y fall in house prices in November, Core Logic reports a 4.7% y/y decline in house prices. This makes five years in a row of consecutive declines in US house prices.

This Just In! Harvard Economist Ken Rogoff has discovered that 'Systematic And Widespread Regulatory Failures Are Choking Our Arteries As Well As Our Economy'. He also is reasonably sure that producers have few incentives to internalize the costs of the environmental damage that they cause. He did come up with “coronary capitalism” - a keeper.

Porn O'Graph: The way up and the way down; people, oil production, whatever.


jfwellspdx said...

Re: History Lesson. I would hold off the little ice age story a bit. Seems some geologists aren't convinced that there were even an increase in large eruptions that corresponded with the LIA:

CKMichaelson said...

jfwell - One of the cramping things about a daily blog is that it is daily. I sometimes 'hold' an item because it seems hinky, but in this case I thought the idea that a 1C change downward brought on a Little Ice Age (no matter what the causes) would serve to suggest that 3 to 6 or 7C rise will not be a day at the beach.

thanks for the ref.


jfwellspdx said...

Oh I agree completely, we are screwed climatically no matter how many volcanoes blow or what sort of nonsense Bill Gates decides to pump into the air.

Keep up the good work. Read your collection of links and pithy commentary every morning.