Tuesday, November 10, 2009

SAR #9315

Just in time for Christmas: Bailout based bonuses.

Short Version: Health-care stocks rose strongly Monday, which is all you need to know about the health-care reform legislation.

Quoted: "There are families not eating at the end of the month, literally lining up at midnight at Wal-Mart stores waiting to buy food when their government checks land in their accounts.“

Stocks, Gold, Oil Soar: As long as central banks promise not to raise interest rates until it is too late, markets will keep zooming, and the dollar will fall – all until it's far too late.

Future Futures: Pretending (a) there will be a 2017 and (b) they have some idea what is going to be happening then, oil speculators have driven the price of December 2017 oil to $100. Imagine, oil at only $100 a barrel.

Scheduling Problem: Investors are turning to TIPS for protection from the expected bout of inflation that Bernanke promises us won't happen (until after a crippling round of deflation).

Made in China Egypt: Chinese manufacturers are outsourcing production to Egypt, seeking cheap labor, investment incentives and unrestricted exports. Labor costs, like water, seem to seek its lowest level.

Things You Knew: Banks prefer to lend to a deadbeat who's so far in debt there's no way it can ever be paid back than to take a chance on small business or the working man. How else do you explain why banks are putting most of their money into government debt rather than investing in the American economy?

Paranoia: Elections are seldom won by the weight of rational argument. Elections – like economies – are swayed by hopes, fear and greed. Mostly fear. This explains Beck, Limbaugh, and Palin.

Music Lesson: Revenue shortfalls force cities to cut back on programs and services and turn to the citizenry for more revenue. Remember that rat population increases are a universal consequence of declining infrastructure spending and vote yes on that tax increase. The Pied Piper doesn't work for free.

History Lesson: Saudi Arabia has targeted $75 a barrel as a fair price for both consumers and producers. This replaces their April 2004 commitment to keep oil in a $22 - $28 price range.

Observation: The continued increase in our nation's debt load will inevitably bring us to the point where our choices will be those once reserved for banana republics and failed states, and the unthinkable becomes not only thinkable but inevitable. The only alternative is huge spending cuts and steep tax increases. Keep your passports handy.

Missing: In the latest installment of 'Revenge of the Sea', a Japanese fishing trawler capsized when it tried to haul in a net full of giant 400 pound jellyfish. The waters around Japan have been inundated with Nomura's jellyfish this year. Experts have not yet blamed global warming.

Bubblology: What the IMF said: Capital flows driven by yield differentials are complicating monetary policy. What they meant: The dollar is weak and getting weaker, inflating bubbles all over the world.

Porn O'Graph: Send in the reserves.


Anonymous said...

Nomura's jellyfish :

What the Investment banks own the sea creatures now, too?

I thought Japanese banks wee zombies... Hmmm


Anonymous said...

Please explain how the economic fear being peddled on this blog is any different from that from Limbaugh, Palin and Beck.

Charles Kingsley Michaelson, III said...

Well, the first difference is that I find our various predicaments enormously entertaining - not scary...

Anonymous said...

Besides, how does our host exactly peddle fear if all he does is link to economic news and analysis, adding a few lines of (often sarcastic) commentary?

In my eyes, CKM seeks mostly to inform. I don't think he's getting either rich or famous by running this website.

Beck and Limbaugh are the established media's old guard, peddling a brand of phoney rich-guy populism for political and career-related reasons.

Charles Kingsley Michaelson, III said...

Anony 241 is pretty much right. I read all this stuff to try to be informed, I parse some of the more important (my call) or interesting (ditto) and pass them along. Many cry out for context and comment, which I happily provide.

And I admit up front that this stuff is all opinion, mostly mine, and that I am no less biased than Limbaugh - just not as rich nor as famous. Yet.


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