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Note: This being the weekend, content is for subscribers to our premium service www.peoplenomics.com.  Saturday is generally a summary of daily events while the Sunday editions pick a single topic and go into some depth with an eye toward how events can impact the individual investor/human and what (if anything) can be done about it...

 

The next free update on this site is planned for Monday morning at 7:55 Central Time unless...well...that's a long list so let's not go there.

 

Yuan Thing At A Time

If this were 'most mornings' and we will still living in 'most times' I'd be pleased to start off with trend related story of the day which is?  (Repeat after me..."The Euro Problems" - nice acapella there...).  But this morning even the "800 lb. gorilla's" gotta move over because we are witnessing the beginning of a huge rollover of international power as "China Eats World" with its currency.

 

If you don't see the significance of this, a quick read of the BusinessWeek article "Yuan poised to become Reserve Currency, Goldman's O'Neill Says" is in order.

 

This is one of those under-the-surface moves that is likely both unstoppable and inevitable since in US-corporate greed-craze strategy, the US has outsourced its middle class to India and Asia by sending jobs there and then importing the fruits of those labors with not even a pretext of leveling the playing field through sensible tariffs which could (once upon a time) has slowed the time and prolonged the 'good life' for the USA middle classes.

 

Instead of redeveloping industry here (rebuilding the rust belt) to a new clear version with readily available technology, penny-pinching corporations with massive mainly financial-only incentives and little to no sense of social justice said (acapella again) "Screw this, screw OSHA, Screw EPA -- we're out!"

 

What the (geniuses or whatever you want to call Washington denizens) couldn't seem to add up straight, was that as jobs left we went the route of South America....tracking into a two tier economy with ONLY the super rich on the one hand and the bloody awful poor on 'other.

 

Could I be full of shit on this?  Maybe, but not when I've got a folder full of headlines that back me up.  Here - take this one: "Two Track Economy: 9.7% unemployment, $200K cars..."  The ugly truth of the situation doesn't gently tap you on the shoulder when you go looking for it - nossir:  It slaps you right upside the head with a two-by-four.  And even that doesn't make it through the thick-headedness in Washington which has been so corrupted by the money-machine that they don't even bother reading most legislation they vote on....absurdly insisting this sham of representative government to still be legit.

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Having growth up in a predominately Asian neighborhood I've got a keen appreciation of the Asian work ethic.  It was no surprise to me to learn growing up how Japan managed to fight off the US as long as it did in WW II from an Island group with few natural resources and a size smaller than Montana. 

Seriously!  They have a different culture than our now ruling paper-asset and ever-present bling-thing.  Much heavier doses of patience and hard work.  A focus on quality and persistence, consumers who make longer time-horizon decisions and hold ancestral values high. Worst thing in the world sometimes is under-estimating the opponent, know what I'm saying?

 

So watch closely next week as the Chinese send a cabinet level representative to Washington to warn us (as in  US) not to get too uppity and emotional about the Yuan rolling into its reserve currency role.

 

Want another shot of reality? In the latest Employment figures from the US Department of Labor, you'll see that Manufacturing jobs in the US now total a measly 11.55 million.  How many is that?  Well, you could put every manufacturing job in America inside the administrative limits of Beijing which has a population of 17.4-million now, and still have room enough left over to house the residents of Los Angeles plus Chicago.

 

What most American's are blissfully ignorant of is the population of Shanghai is even bigger than Beijing!  If you think New York is big with its 8.3 million residents?  That's about the size of Dongguan Prefecture... which

 (if you're like most Americans) you've probably never heard of, let alone know where it sits on a map of China.

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If I at times sound like I get all worked up over the export of US jobs to other countries while our core manufacturing capability is being hollowed-out, just try to deal with it.  China's building their middle class and we're being led down a path to destroy ours. No...make that have been led down the path - and this is what we get.  Reap whatcha sow, remember?

 

The outcome should be obvious, although it will take some time to arrive here.  But Renminbi where you heard it.

 

China in Haiti

Another aspect of China projecting power - although not specifically economic in nature - is the report this morning from CCTV about how "China's anti-riot squad maintains public security in Port-Au-Prince after earthquake."

 

No, it's not a big deal, although it does give me pause to reconsider whether those stories about Haiti having large and as-yet untapped mineral or petroleum deposits might have something to them.  China's presence makes me wonder, you know?

 

'R" Word Watch and the MSM

We can't be too far from a major decline in the markets I figure when videos are popping up on YouTube under headlines like "CNN- Liar in the White House".

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Still, have to admire how the battles of right versus left are not seen for what they really are:  the Haves on the one hand and us (the Have-Nots) on t'other.

 

Super Sunday?

Lots of talk about how House leaders (hey!  I'm being charitable here!) have come up with a $940-billion dollar healthcare bill. the president, who had been planning a trip to Asia has put that off until June because of the action due this weekend.

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Those who have taken the time to read the bill are discovering some things that aren't very nice...like a provision that allows IRS to confiscate refunds if people don't buy healthcare.  Is this government strong-arm tactic really new?  Yes, and no.  No, in that if you're in default of a student loan, for example, then your refund from IRS can already be snatched.  Yes, in that it will force everyone who deals with IRS to consider healthcare more closely.

 

Or, it will just drive more people into the underground economy which is growing by leaps and bounds, anyway. 

 

Then there's the matter of 'deeming' something as big as this as passed - should speaker Pelosi try that.  This is just screams for a constitutional test in the courts, but in the very short term, it sets the government up in the business of collecting funds for something that won't yet be delivered.  In other words, we get to pay for this one before it's actually delivered, which would be the equivalent to walking into a car dealership and agreeing to buy a car before it's even be unveiled yet.

 

Methinks this is just about puffing up the balance sheet of these United States enough to avoid a ratings agency downgrade.

 

You see:  The way I have it figured is this:  While "Moody's says U.S. could test Triple-A (bond) Rating"  guys like Treasury boss Tim Geithner have this stuff gamed out well in advance, so when he says there's "Not a chance" the US will lose its triple-A rating, it may be because while we wait for actual delivery of government healthcare to show up a couple of years out, the government will be collecting money for it in advance.  Yep, that's right:  the government would begin collecting money from businesses and individuals in 2011 and wouldn't deliver a product until 2014.

 

Lemme see:  Government gets more money, balance sheet improves, and since they can estimate any cost numbers they want, why Presto!  Magic!  No loss of bond rating.  Either this is really slick or sick...haven't decided that one.

 

Anyway, that's why I reckon everyone inside the Beltway is in such a frenzy to get this piece of (expletive deleted) legislation through.  Brings in cash, avoids the debt collapse and pushes it out into the future when another party will be back in power. EZ-Sleazy.

 

No doubt about it, at least in my mind: politics is dirty as ever. Always about money and power, power and money.  The more things change, the more they stay the what?

 

Going Where?

A reader in the Midwest sent in this curious picture along with a note:

"George:

Just like to let you know that I have seen several truckloads of these up-armored vehicles making there way south through the Midwest. I have lived here all my life and can say that I have NEVER seen this before. In the last week I have seen no less than four flatbed haulers (daytime and evening) moving these vehicles. There appears to be no markings as to what branch of the military might be receiving these vehicles. They are tan in color and look ominous. Can anyone tell more about where they are headed and who is receiving them? The timing is really freaky.

I have attached a photo of the vehicles."

Uh...my guess?  Only a guess but NORTHCOM maybe?  I'll grant you they look ominous....I'm still trying to figure out how NORTHCOM's area of responsibility includes Canada...dunderhead that I am.

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I would have thought NORTHCOM would have saddled up and headed down to Falcon Heights Texas where a Mexican navy chopper hovered over a house about 2-miles inside the USA but that incursion by foreign troops into the USA was pretty much 'blown off' by the administration.

 

Hasn't escaped Rick Perry's notice and he's sending  Kiowa and Lakota helicopters to the border as part of the state's 'spillover violence contingency plan'.

 

Seems the administration doesn't want to bring too much public attention to the developing border incursions on our south - since it would belie even more truth about NAFTA than we already expected...  Hello?  Anyone home minding the US border or Constitution, anymore?

 

The Anthrax Cover-up, Redux

I suppose you already read this week that the Obama administration is threatening to veto intelligence agency budgets if there's any move to reopen the investigation into the case of Dr. Bruce Ivins...who was nominally made out as a sole perp of the 2001 anthrax attacks.  But was he?

 

The only reason we can see for not wanting to reopen the case with an independent investigation is that it might lead to more questions about the FBI at the time and that...well...you can piece those implications together, I suppose.

 

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Coping:  Friday at the WuJo

The whole subject of interest down at the WuJo (where the woo woo meets reality and science on the mat of clear thinking) is the notion of realities colliding with unusual side effects. 

 

Part of the reason is I'm hip-deep in writing a novel ("Dimension Barrier" which I should have finished in a month or two).  But it's also because the reports related to this are just incredibly interesting.  Take this one:

"George, Love the site, I'm a frequent reader. I am writing to you because I am wondering if you have ever heard of anything like this...and because I need to tell someone but if I told my friends they would tell me I'm nuts.

Here goes: I am 39 years old, live in Chicago and take the bus from time to time. I am always very conscience of my surroundings and very rational. A few days ago I caught a bus one block from my house, rode the bus north for about 5 miles, got off the bus and walked one block east to my destination. After I did what I needed to do, I walked back one block west to the busy street that I came north on and CROSSED (I had to run across to beat traffic) it to catch a bus going back south. I got on the bus and started to review some paper work. I looked up 10 mins later and realized that the bus I was on was going NORTH.

I keep telling myself that I had to have crossed the street and just don't remember crossing it and then crossed back to catch the bus....but I KNOW that is not what happened. I thought about this for the rest of the day until I went to a party that night. I really don't get it."

This is an area which Cliff and I talk about all the (wait for it) time.  In fact, a neat summary of the subject area is up (free) on the www.halfpasthuman.com site and is really a most savory read...  The specific page is here/this one.

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I'd draw your attention to the 'time creep/reality creep' discussion that gets rolling with "As an example consider the story of the fellow going into the big box store in the SW of the USofA..."

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There continues to be a growing body of evidence - mostly circumstantial, but evidence and reports nonetheless that realities - other than the one with Starbucks in it - are colliding.  Here's another reader report:

"We moved into our home about 8 years ago. My wife started to tell me that she had seeing a ball if light coming from the master bathroom. I did not believe her for a long time. However, we were in bed one night and just about to go to sleep. All our animals were accounted for. Then there was a feeling of something heavy dropping between my legs and her legs. It felt like a heavy bowling ball being dropped or maybe even a child jumping on the bed. Freekie! My wife has reported being touched down the side of her body like a child poking his finger a different intervals to wake her up. We have had many other minor occurrences since then. Recently the wife said she heard someone in the bedroom while she was in an adjacent room. She went to look and saw a black shadow thing low to the ground. It crossed by her and ran/rolled into the other bedroom. Then it disappeared. I saw the same thing a while back but did not say anything about it to her. It was animal sized and blackish. It moved like a tumble weed and crossed in front of me heading for the bedroom. .......Sometimes it is hard to sleep at night.

So I just keep collecting bits and pieces and weaving them into my novel...which may turn out to be less novel and more reality than intended...thinking about changing my name to Jules Ure or George Verne.

 

Falling Pilot Ranks?

Short-term, maybe.  Interesting article from the AOPA's online newsletter about the big decline in the number of student pilots in the USA.  Went from 81,000 in 2008 down to 72,000 in 2009. 

 

All of which gives me hope that as the economy continues to decline Elaine & I will be able to pick up a cheap puddle-jumper.  Even though a good condition Cessna 172 isn't in the budget yet, a solid used Lake amphibian (LA4-200) is what I'd really like...most interesting plane I've flown.

 

If you're gonna dream, dream big.  The price of small dreams versus large ones is the same...

 

Which gets me back to economics:  Likely the reason student pilots are down is I reckon a small wet trainer is about $70 and hour with another $40 on top of that for a CFI to ride along - that's what we were paying...

 

Even Strange Sky Happenings

We noticed the report in the Wenatchee (Washington the state) World newspaper recently about a strange 'hole punch cloud' - which seem to be round clouds that don't have a formal name or cause nailed down yet that I'm aware of...

 

Timbbbbeerrrrr!

All kinds of answers to my question earlier this week about why all the crap-grade lumber around in lumber yards and almost nothing worth putting a hammer and saw to.  Good answers went like this one:

"You mentioned the poor quality of lumber available in Tejas - seems the issue is endemic this spring. We needed to replace some lower window molding, probably due to the very wet winter and spring in North Carolina - and hired a local workman to assist. When he delivered the 2 x 4's, I commented on the rough edges, lots of knots, and straightness (NOT) of the planks, only to hear that "it's that way all over; just cannot get good wood!" Since I had just read your column, I guessed that all the good wood was going to China, and the workman shook his head; "No, that's not where all the good wood is going - it's all being bought up for military rebuilding projects and gets shipped straight to Afghanistan" Turns out he is an ex-paratrooper, has kept up his military contacts, and that is indeed where all of our good American lumber is going. Hmmmm - we wind up with the scraps. Seems familiar, somehow. Not many trees left in either Iraq or Afghanistan ?? Must be the reason all the building we see on TeeVee are rock, stone, or brick.

Here all this time I thought we had enough masons to do that kind of work with locally available materials...

 

 

Drop by Monday - or better, read the additional content on the www.peoplenomics.com site this weekend.

 

Care to bet on what happens in the market once we get past triple witch week today?

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Send your comments to george@ure.net

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Shop Till You Drop Department:

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"Live on $10,000" A Year

Having a hard time making ends meet?  (Like who isn't, right?)  A good starting point to better match up income with outgo is our $10 e-book "How to Live on #10,000 a Year...or less!"

 

 

 

It's an automatic download.  It's written in an information dense style: The whole thing runs about 65 pages, but it gives you a vision of how to not only live on the cheap, but also how to migrate up the economic foodchain if you have a little hustle left.  A bonus section called "How to Build Anything" should instill confidence if you've never taken on a home improvement/home creation project before, too.....  Click here for the index and details.

 

MyGroPonics

My commodity broker JB Slear and I have written a simple book to get you started on high density hydroponics.  It's an example of how someone with a little creativity, access to a few 'dollar stores' and willing to try out some new farming techniques can grow an amazing amount of produce sin a very small space - like even an apartment balcony (if it gets some sunlight).  Sound interesting?  It's just $10 bucks here...

 

       

 

Pass It On

A different take on things - that's what you'll find here most mornings.  If you know of anyone who might also like our content, simply click here and send a link to them.  Or, if you hated what you read, send the link to all your 'worst enemies'.  Like they say in Burbank, "Ain't no such thing as bad press..."

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 Last week's report is here.    For back issues of this site, click here.

 

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Thursday March 18, 2010

That Weird Hawaii Reference

OK, this is seriously weird...I couldn't write a better Twilight Zone episode if I had to.  Last weekend in Peoplenomics, we discussed as a planning scenario something that would 'fit' with a fair amount of linguistics.  The idea was that the Pacific tectonic plate would split on a line from Victoria to Suva, Fiji, or it would break along a southern Japan (through hawaii) to the Chile-Peru border area.  In either case, Hawaii could be devasted.

 

Now, in this 'exercise' the lead in was going to be a West Coast/US quake this week, perhaps toughed off by the arrival of a CME:

"As bad as the situation was in LA, it was only 8-weeks, three days, and 9-hours later than the biggest quake in Hawaii's recorded history took place. Larger than even the March 27, 1868 event which is recalled this way:

"On March 27, 1868, whaling ships at Kawaihae on the west coast of Hawaii observed dense clouds of smoke rising from Mauna Loa's crater, Mokuaweoweo, to a height of several miles and reflecting the bright light from the lava pit. Slight shocks were felt at Kona on the west coast and Kau on the flanks of the volcano. On the 28th, lava broke out on the southwest flank and created a 15-mile flow to the sea. Over 300 strong shocks were felt at Kau and 50 to 60 were felt at Kona. At Kilauea the surface of the ground quivered for days with frequent vigorous shocks that caused lamps, crockery, and chairs to spin around as if animated. One shock resembled that of a cannon projectile striking the ground under the proprietor's bed, causing him to flee, according to the narrative published by C. H. Hitchcock in the Bulletin of the Seismological Society of America in 1912. Between March 28, 1868, and April 11, over 2000 distinct shocks were felt at Kona.

The main shocks struck on April 2, at 4:00 p.m., and again on April 4 at 12:30 a.m. A magnitude of 7 3/4 was estimated for this earthquake (by Augustine Furumoto in his February 1966 article on the Seismicity of Hawaii in the Bulletin of the Seismological Society of America) based on the extent of intensity reports. Instrumental recordings, the usual basis for computing magnitudes, were not available at this early date. The shock was felt throughout the islands as far as Niihau some 350 miles away. The ground rolled like a ship at sea and many walls tumbled down. A landslide three miles long and thirty feet thick swept down the hill carrying trees, animals, and men. Thirty-one people and thousands of cattle, sheep, horses, and goats were killed in the one slide. A seawave struck the coast from Hilo to South Cape, being most destructive at Keauhou, Puna, and Honuapo; 180 houses were washed away, and 62 lives were lost to the wave alone. A 10-foot-high wave carried wreckage inland 800 feet. Not a house survived at Honuapo. A stone church and other buildings were destroyed at Punaluu. Maximum wave heights were 65 feet, the highest observed on Hawaii to date. (More on this earthquake.) "

We now skip forward nine weeks from today:

"What is described as the biggest earthquake in the history of Hawaii quake was the largest ever recorded. It's magnitude was an astounding 9.9. But what made the quake even more outrageous - besides sending massive tsunami toward California, the result of both the shock as well as undersea landslides.

The devastation was not confined to Hawaii. In addition to the tsunami that killed several thousand in California, and thousands more in Mexico, the quake set off sympathetic quakes at 7.8 and 8.3 in Panama, damaging the Canal, as well as a 9.1 in southern Peru. Causalities in Lima, Peru were placed in the tens of thousands. As many as 75,000 died in Hawaii from structure failures, road destruction and interisland tsunamis.

Worse than even all these things was a newly evolving string of quakes in the 5.0 to 7.2 range that began to pop off several times a day along a rough 11,100 mile long line from Kagoshima in southern Japan, to the east passing 6 miles northeast of Kailua on Oahu, bisecting Molokai, and at its closest, within 8/10ths of a mile of the Haleakala National Park on Maui and then heading southeast from 35 miles northeast of Hilo on the big island of Hawaii, but more importantly just 60 miles from Mount Kilauea and 65 from Mauna Loa. Nature has been building the weakened path of least resistance for eons. But only since the Boxing Day Tsunami a few years back had the break in the Pacific Plate become a reality.

Geologists went on television pretty much non-stop over the summer having no clue that on November 15th and even more serious geological problem would occur: The 8.6 quake in the Canary Islands.

This "hypothetical quake" would happen in May.

 

So having overslept this morning, what's the first thing I read?  OMG its President Obama talking about a Hawaii Earthquake!  The headline is "Puzzling Statement: Obama Says ‘Louisiana Provision’ Will Help With the Earthquake in Hawaii".

 

Is this strange, or what?  Which gets us to...

 

Consumer Prices

Next bit of weirdness is the Consumer Price Index released today by the Labor Department:

On a seasonally adjusted basis, the Consumer Price Index for All Urban Consumers (CPI-U) was unchanged in February, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the index increased 2.1 percent before seasonal adjustment.

The unchanged all items index was the result of a decline in the energy index being offset by slight increases in the indexes for food and for all items less food and energy. Within the latter group, declines in the indexes for apparel and household furnishings and operations were more than offset by continuing increases in the indexes for medical care and used cars and trucks. The 12-month increase in the index for all items less food and energy now stands at 1.3 percent, the lowest since February 2004.

The food index also edged up in February. The food at home index rose slightly, the net result of the major grocery store food group indexes posting a mix of modest increases and decreases. In contrast, the energy index declined in February. Decreases in the indexes for gasoline, electricity, and fuel oil more than offset an increase in the index for natural gas.

OK, fine, but if you believe that to be anywhere near 'reality' (whateverthehell that is anymore) Gas prices are up 36.9% compared with year ago levels, but kfood is alleged to be cheaper.  Got my ViseGrips handy? Got a lot of pinching to do this morning.  Costs up 2.1% for the past year, my foot!

 

I (and lots of fiction writers) can hardly wait for the jobs report tomorrow. Bet it will be even or improved...

 

Wee Bit O' Bankster Bust

I see where one of Ireland's top bankers has been arrested over alleged fraud.  Bad news  in one of the PIIGS countries?  (Portugal, Italy, Ireland, Greece, Spain)?  Well, yes and no.  Well, at least they didn't bust him on St. Paddies Day.

 

Saving Facebook

I hope you caught the alert out yesterday about a new computer virus that supposedly steals Facebook user passwords?  I still hold to my claim that social networking sites are little more than the modern analog to CB radio, but let's see if people spend as much time on the stuff in five years, or so, as they do now.

 

Happy Day Rally

no doubt about it, the market's gonna roll at least out of the chute this morning as FedEx came in good, there was a slight drop in new jobless claims last week and the CPI numbers were tame (not saying believeable, just tame).

 

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Coping: Today's Report: Late!

I think most folks will agree, the consistency of delivery time for this site has been pretty good.  you know, the old snow, sleet, hail, and so forth?  Well, had to happen sometime, so why not today?  Woke up at the appointed hour, hit 'snooze' (or at least thought I did and then./..well...you don't see much of a report for today, do you?

 

So, please check back about 10 AM and there ought to be a little more here.

 

Knew this year's conversion to daylight time was going a bit too well...the report this morning will be updated several times as the coffee kicks in...

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An hour later, the morning has become even stranger than strange.

 

The power has gone off twice during the writing of this morning abbreviated report, which is not so strange in and of itself, but the fancy emergency power system decided at this very time not to work right, so pardon me while I cut it a bit short and see what's going on?

 

Normal (or what passes for that around here) should return tomorrow, but just no telling the way the day has started...Ciao.

 

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Wednesday March 17, 2010

PPI/Hiding of Sausages

The Producer Prices are out this morning and oh (feign surprise here) things are looking up!

"The Producer Price Index for Finished Goods declined 0.6 percent in February, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This decrease followed a 1.4- percent advance in January and a 0.4-percent increase in December. At the earlier stages of processing, prices received by producers of intermediate goods moved up 0.1 percent and the crude goods index fell 3.5 percent. On an unadjusted basis, prices for finished goods advanced 4.4 percent for the 12 months ended February 2010, their fourth consecutive 12-month increase."

What's this about the Sausage hidden?  Oh, uh, M1 (the primary money measure by the Fed)  is up 9.5% year-on-year.  So gee that must mean 10.1% incipient deflation huh?    Or better: finished prices up 4.4% and yet there is (mysteriously) no inflation for Social Security recipients to worry about...WTF?

 

Golly, and you were wondering "George, why is there no real jobs recovery?"  Duh.  Next sausage...no....make this a 'brat'...

 

Fed's Power Grab

The sequence goes something like this:  Grab control of the nation's money supply.  Then, water down the currency to where it's worth less than 1/20th of its purchasing power from 1913.  Along the way under Slippery Dick back out of gold and silver convertibility.  A fine soap it's been.

 

And as if THAT's not enough, put yourself into the position of enforcing banking regulations.  This is just soooo rich....from Ben Bernanke this morning....

"The Federal Reserve strongly supports ongoing efforts in the Congress to reform financial regulation and close existing gaps in the regulatory framework. While we await passage of comprehensive reform legislation, we have been conducting an intensive self-examination of our regulatory and supervisory performance and have been actively implementing improvements.

On the regulatory side, we have played a key role in international efforts to ensure that systemically critical financial institutions hold more and higher-quality capital, have enough liquidity to survive highly stressed conditions, and meet demanding standards for company-wide risk management. We have also been taking the lead in addressing flawed compensation practices by issuing proposed guidance to help ensure that compensation structures at banking organizations provide appropriate incentives without encouraging excessive risk-taking.6 Less formally, but equally important, since 2005 the Federal Reserve has been leading cooperative efforts by market participants and regulators to strengthen the infrastructure of a number of key markets, including the market for securities repurchase agreements and the markets for credit derivatives and other over-the-counter derivative instruments.

To improve both our consolidated supervision and our ability to identify potential risks to the financial system, we have made substantial changes to our supervisory framework. So that we can better understand linkages among firms and markets that have the potential to undermine the stability of the financial system, we have adopted a more explicitly multidisciplinary approach, making use of the Federal Reserve's broad expertise in economics, financial markets, payment systems, and bank supervision to which I alluded earlier. We are also augmenting our traditional supervisory approach that focuses on firm-by-firm examinations with greater use of horizontal reviews that look across a group of firms to identify common sources of risks and best practices for managing those risks. To supplement information from examiners in the field, we are developing an off-site, enhanced quantitative surveillance program for large bank holding companies that will use data analysis and formal modeling to help identify vulnerabilities at both the firm level and for the financial sector as a whole. This analysis will be supported by the collection of more timely, detailed, and consistent data from regulated firms.

Many of these changes draw on the successful experience of the Supervisory Capital Assessment Program (SCAP), also known as the banking stress test, which the Federal Reserve led last year. As in the SCAP, representatives of primary and functional supervisors will be fully integrated in the process, participating in the planning and execution of horizontal exams and consolidated supervisory activities.

Improvements in the supervisory framework will lead to better outcomes only if day-to-day supervision is well executed, with risks identified early and promptly remediated. Our internal reviews have identified a number of directions for improvement. In the future, to facilitate swifter, more-effective supervisory responses, the oversight and control of our supervisory function will be more centralized, with shared accountability by senior Board and Reserve Bank supervisory staff and active oversight by the Board of Governors. Supervisory concerns will be communicated to firms promptly and at a high level, with more-frequent involvement of senior bank managers and boards of directors and senior Federal Reserve officials. Greater involvement of senior Federal Reserve officials and strong, systematic follow-through will facilitate more vigorous remediation by firms. Where necessary, we will increase the use of formal and informal enforcement actions to ensure prompt and effective remediation of serious issues.

In summary, the Federal Reserve's wide range of expertise makes it uniquely suited to supervise large, complex financial institutions and to help identify risks to the financial system as a whole. Moreover, the insights provided by our role in supervising a range of banks, including community banks, significantly increases our effectiveness in making monetary policy and fostering financial stability. While we await enactment of comprehensive financial reform legislation, we have undertaken an intensive self-examination of our regulatory and supervisory performance. We are strengthening regulation and overhauling our supervisory framework to improve consolidated supervision as well as our ability to identify potential threats to the stability of the financial system. And we are taking steps to strengthen the oversight and effectiveness of our supervisory activities.

Thank you. I'd be pleased to respond to your questions.

OK, here's one:  Does the Fed collect interest on the national debt and how much benefit to the nongovernment owners of the Fed has accrued since 1913? 

 

Want another?  When can we have an open audit of Fort Knox?  Want more?

 

The REAL Answer Is...

Right out of the UK Telegraph this morning: "Moody's fears social unrest as AAA states implement austerity plans..."  The five include the US and UK. Which explains neatly why the Fed wants no audits and more control - to help paper over things.

 

Fine...I've got popcorn and beer at the ready, besides I'm kinda lazy when it comes to 'revolution memes' - much more a 50-yard line watcher type.  But wait!  There's a competing play/distraction going on over at C-SPAN...which one is real, which is the feint?  Either?

 

Meantime in Washington's Duma

Say, don't know how you feel about this, but if Congress enacts healthscare without an open roll-call vote, that means we will have sunk below third world tinhorn dictatorships which at least have the decency to vote.

 

I'll go further, if you like:  If Congress doesn't do a public vote, we no longer have representative government.  Plain and simple, all the socialistas BS rhetoric aside, we either get accountability or we don't have government by and for the people anymore.

 

It's just that simple, as I see it.  Send 'em all home, since they'll 'deem' whatever the hell they want, anyway.  But then we know from bailouts for outfits like AIG and crooked banksters that's the deal anyway...

 

If such a move takes place, it's only a short step to cancelling elections this fall to turn out those who are wrecking America.  Wanna make a side bet on this?

 

Russia Today coverage from Tuesday was interesting...

 

Happy Talk North

Our 'out on the Canadian prairies' contributor says the happy-talk headlines are all over up north, too. "Oh look, we're out of the depression.  I'm sure the tens of thousands out of work up here feels much better."

 

Why, of course!  If they're not thankful, they must be terrorists, right?

 

Guns Made Within

Speaking of which while its still legal, here's one that has to worry the Duma...I mean Washington.  Five states have now opted out of the Alcohol, Tobacco and Firearms gun regs for weps made inside their states.  Not sure what this means besides exempting guns made in the states involved from things like registration and what have you.  Texas is looking at similar legislation as are lots of other states... certainly serves to underscore the predictive linguistics about the 'revolution meme' that seemed almost ridiculous as little as a year ago, doesn't it?

 

Wonder if putting a milling machine to a gun originally made 'out of state' or out of country would count in such places?  Just presactly what does the word "made" mean? 

---

You see the Bigger Problem here, right?  How long before guns made within one exempt state are allowable into another exempt state and another and next thing you know we have two federal governments!  One being the power-usurping division with AFT, taxing, healthcare mandating, and 'money printing' but with another kind of 'association between constitutional states' which would uphold State's Rights?

 

What a thought, huh?  Two 'federal' governments...my oh my.

 

Non-Lethal Torture

But wait!  Who needs guns when Gitmo is still open for business and using high decibel volume music is being used as a torture tool.

 

Oh that again, huh?  Musicians are up in arms and at some point, a person with a good memory might ask embarrassing questions like "What happened to that pile of campaign promises?"  Tisk, tisk, you security risk, you.  Here, take these pills...

 

Cost of Primping Index

You see where the Brits are now counting crashing prices of consumer glamour items in their cost of living calcs?  Just amazing how the bling and fitness paradigm is sold, huh?  So when Prozac went generic was that deflationary?  Is that why the COL is claimed down???

 

Where Is Our Good Lumber Going?

I think I've mentioned that our projects around the ranch involve adding onto my office.  Yesterday, Panama Bates went into town on a supply mission to procure some one by sixes and such.  He spent nearly an hour trying to find decent lumber and for some reason, the local lumber yards all have crappy wood over the past year - and getting worse! Even ther store personnel admitted it.

 

When I see headlines like "CME lumber ends mixed housing starts bearish" I ask myself "Where's all our real standard and better lumber going?  China? Other Asian countries?  I mean really the stuff lately is knotty, wormy, warped, bad-edged crap.  Am I the only one seeing this?

 

Maybe you don't know a 2 by 4 from a swizzle stick and could give a rat's ass.  But people who do real work notice this stuff.  Along with rusty Chinese rebar and the whole lot of it.

 

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Coping:  Qualities of Friendship and Achievement
Let me give you the top line first:  If you're in Washington D.C. tonight and you get a chance to go to Andrew Mellon Hall, you'll be seeing the best and brightest chance of a secure and technologically advanced future rolled out as the annual Aviation Week honors are bestowed on the dream of America's military academies.  One each from the Navy, Army, and Air Force.

 

Not normally the kind of thing that I write about...but then I don't write about a lot of things in my past.  This one, however, is special.

 

Let's kick back to the beginning. 

---

Back in about April (or was it May?) of 1953, my mother was walking my sisters and me home from the store.  This was back when grocery stores were within a 6-10 block walk of where most people lived and only some of the sidewalks were paved on Beacon Hill in Seattle.

 

As we were coming down the hill, on the last part of what was paved sidewalk before 'hitting dirt', my mom happened to strike up a conversation with a woman who had a son - Rob Carter - who was about my age, just a tad younger.  Rob's mom worked some of the time as a beautician and you can probably see the picture forming already: My mom would 'sit' the boys (at our ages 'sitting' would be an insult) but the deal distilled down to cheese sandwiches and soup for lunch served by my mom and trying to keep Rob and I out of trouble while Rob's mom was able to work.

 

No money involved - that was a time when people just helped one another and besides, two boys were pretty much self-entertaining. When we were 4 or 5, no sweat.  However, within a few years as our 'character' developed, we got more and more into what back in the day was called 'trouble'.

 

By grade school we were hellions of the first order, nearly setting a church on fire with a 'camp' fire that got out of control in an adjoining vacant lot, then we would send off candle-powered balloons made of laundry bags with time-fused M-80's, cherry bombs, or whatever else would make a huge report when lifted, and all kinds of other boys-will-be-boys stuff. We got so we could fuse anything, such was teenhood and the old Herter's Catalog for powder and whatever else. Smoke bombs we particularly fun. 

 

You may not remember back to the pre-Nanny State days, but back when, drug stores sold salt peter and chemistry sets were ever so much more capable of providing a real science experiment.  Whether that meant rocket-powered cars, projectiles, or vile liquids for this vile purpose, or that, made little difference.  By the time we got to science class we had plenty of first-hand learning not to mention a few burns, scars, and tall tales to go with it.

 

If you didn't know the burn time of a Camel versus a Taryton, you were simply not in our league when it came to prankery.

 

The older we got, the more adventures: Being chased by an axe-wielding hobo, scourging around abandoned railroad round houses and abandoned industrial building, going on 50-miles bike rides from Seattle to Tacoma and back (via Vashon Island and the ferry route) and more.

 

It was as though we did everything good (and no small number of bad things) any two young men could do.

 

Along about age 13, or so, we both got intensely interested in ham radio - which proved itself an enduring common interest we're both involved with even now.  We took the bus to ham radio training classes at the old Seattle Radio store and studied Morse code, long since discarded as a requirement, but this was 1963.

 

Rob got his license the first time through (being academically my better at the time) but I was more mechanically inclined now and then - so we shared strengths and weaknesses in electronics for years; each learning from the best of the other.  I picked up a First Class commercial ticket - which got me onto the broadcasting track while Rob stayed more conventionally bookish.

 

I was brought up Lutheran, Rob Catholic, and as would be expected our paths diverged along about high school or so.  Rob went to O'Dea in Seattle while I stayed the public route at Cleveland. 

 

Near as I could figure the main difference between the Catholics and the Danish Lutherans was one said the mass in English and shared the wine, but we discussed fine points of this and a zillion other topics, for hours. 

 

Rob tracked briefly into Seminary but it wasn't a fit.  More academics followed.  Meantime, I went the broadcast engineer route which eventually led to remote microwave sites protecting America from a sneak attack on an RCA defense project. 

 

We kept in touch over the years...and once in a while we'd get together for dinner to recount boyhood adventures and whether we'd done this, or that, right at the time.

 

Rob went on to graduate top of his class (up there somewhere) at Seattle University and then on to the University of Chicago School of Social Work, Manga Cum Laude, if I recall.

 

From there it was into the military for a 20-some-year stint as an officer.  I'd gotten an O club card at 18 with my then GS-15 equivalency thanks to those remote sites in Alaska...I just didn't have to worry about inspections.  Rob retired as a Major and he & his family live quietly south of Seattle and he's raised a great family after the usual military moving hither and yon, with an extended tour in yon.

===

About here, you're no doubt asking "What the hell does this have to do with the Aviation Week dinner tonight in Washington honoring top grads from the military academies?"

 

Ah...so eventually we come back to the point of this morning's not:  Roby and his wife Becky have a son who's a plain old American superstar kid.  Top of his class in aeronautical engineering and graduating in May from the Air Force Academy, number 7 or 8 overall, I think it is for the whole class of somewhere near 1,000 of what are already highly selected young men and women, but #1 within his specialty - aeronautical engineering - the designing things that fly faster and higher....

 

After sizing up some interest from places like Cambridge and Rice University, my understanding is that Nick Carter  (no, not the mystery novel figure)  will be doing a two year hitch to polish off a Masters in Aeronautical Engineering at MIT.  Way cool and a lesson in passing is good grade really do pay off - big time.

---

In a couple of weeks, Rob will be coming down to visit the ranch. Another chance to laugh about our long history, retell and review old stories of who did what when we were young....  and wonder about how Life works - why I did broadcast and software route while he did psychiatric social work aqnd how could he tolerate so much routine?  What was I so much against it?

 

Many tales, questions, some spiced rums in there somewhere, and some Morse code and a few ham radio projects...I don't think either of us has totally grown up, at least I hope not. Competent technically, but still kids.

---

The bottom line of the AV Week dinner demonstrates something else: The nuts don't fall too far from the tree. 

 

So at about 5 pm Texas time tonight, I'll hoist a glass of (whatever's handy), toast in the direction of Washington, D.C. and tonights Aviation Week dinner.

 

My son's went the medical route as an EMT...Rob's boy's the aerospace engineering up-and-comer.  Neither one of us can wear shirts with buttons anymore.

 

Hard to have a better ride for either of us, as friends or fathers sharing notes, I suppose. One will make the future, the other will keep a few people alive who wouldn't otherwise be around to enjoy it.  Fine metrics.

---

My late grandmother on the Danish side used to say:  "You want to know what immortality is?  Look at the quality of your kids...that immortality - what people pass on to the next generation." Good view, that.

 

It's been a real privilege to have a friend for about 57 years, let alone shoot guns, launch aerial bombs, race everything from bikes to you name it, drink rum, compete in ham radio, and do enough silly sh*t to fill several books.

 

Big accomplishment tonight on my friend's quest for immortality comes tonight as his son Nick receives high honors.  My son's already chosen his course in life and now Rob's boy steps up to the next level in his. 

 

That's two young me who are the 'best we can make 'em' on the side of what's right and what we both hope are the building blocks for a better America to come.

"Titles of honour add not to his worth,

Who is himself an honour to his titles."

Elaine & I will try to make it up to graduation in Colorado Springs in late May.  Wonder if  I can get my bucket list ride on the Durango and Silverton narrow gauge railroad in?  Different than the railroad from Cusco to Machu Pichu, but railroad rides are just a kick...

 

Notes from the WuJo:

Latest in our continuing series of 'things around the margin" of consciousness?

"Hello,

If you’re interested, along the lines of the shadow people dancing in the man’s yard, here is a little account of what happened to me about a year ago. Around 11 pm, my husband was away and I was home in bed and the kids were asleep in their rooms. We have a not-so-solidly-build 2-floor wood house. The staircase creaks something terrible when you go up and down it. My room is quite near the stairs.

Well, I start feeling I hear something moving upstairs in a part no one should be, but lie there a little tensed up and continue to listen carefully (all the while assuming it is my imagination). Well, sure as heck someone starts down the stairs -- the weight and step rhythm is perfectly clear! So I fly out of bed and rush for the stairs to catch them head on. With my first movement I hear that the person turns and goes back up the couple of stairs they started down. Then I hear step after step as they run across the upper floor towards the farthest room –our “office”. I run up like crazy, flipping on the lights as I go and check the closet, BR, and finally the last room and all its closets. NO ONE THERE! Not a thing! Balcony door locked. My kids remained asleep through the whole ordeal.

I heard nothing more. Here is the real catcher, though! The footsteps running across the upper floor were for me clearly the steps of a very small person – I would say no bigger than an 8yr old! This blew my mind. I went back to bed then, not really scared but with the thought that whatever this was – and it WAS—it was out of my league if I couldn’t see it. I just lay in bed thinking this is one of those times all I can do is hope something’s watching over me and my family --in a good way, that is!

Say, didn't have any missing time, did you?

 

Oh and check out this recent 'shadow people' story...most interesting, huh?

 

Get Rich Slow Department

A number of people sent in suggestions on what to read/study if you want to rise above average income levels.  Some examples:

"Get into Rental Property:  First Cousin to owning a money-printing machine, if you have thick enough skin to tolerate the "3 T's": toilets, taxes and tenants.

The Critical Mass is right at 4 units. At that point, the cash flow is good enough to tart paying a plumber and A/C Tech instead of doing the work yourself.

Problem is, most people get where the whole business of dealing with Tenants (largely deadbeats and scumbags) and local/state laws that favor the tenant and screw the landlord just, generally, makes them puke.

If you have 6+ units, then you can find some sumbitch that you make, "manager," for a piece off his rent and get HIM to collect from the tenants.

Anyway, for Tax Implications, the double declining balance on mechanical subsystems helps speed your way to the bank."

Good point and it reminds me about this email suggesting:

"From my experience ( =D>) all "honest" wealth has been earned by some sort of "depreciation utilization." Few people, and tax preparers, in particular, have a strong understanding of the subject, and how to apply it. By the way, farming is a very favorable candidate for its use. A "must be studied" subject."

My personal experience with depreciation hasn't always been good.  The core concept is that you can write off (as an expense) the cost of something over its serviceable life.  BUT when you sell it for more than its depreciated value, you get to recapture the depreciation.  Maybe I just hold onto things longer than I should. 

 

No, spouses are not depreciable assets.

 

---

Tuesday March 16, 2010

Housing: Up, Down, and Nowhere

Talk about a press release with a little 'something for everyone' this is a peach from the Census Bureau this morning:

"BUILDING PERMITS

Privately-owned housing units authorized by building permits in February were at a seasonally adjusted annual rate of 612,000. This is 1.6 percent (±1.0%) below the revised January rate of 622,000, but is 11.3 percent (±1.8%) above the February 2009 estimate of 550,000. Single-family authorizations in February were at a rate of 503,000; this is 0.2 percent (±1.0%)* below the revised January figure of 504,000. Authorizations of units in building with five units or more were at a rate of 89,000 in February.

 

HOUSING STARTS

Privately-owned housing starts in February were at a seasonally adjusted annual rate of 575,000. This is 5.9 percent (±10.0%)* below the revised January estimate of 611,000, but is 0.2 percent (±9.8%)* above the February 2009 rate of 574,000. Single-family housing starts in February were at a rate of 499,000; this is 0.6 percent (±10.6%)* below the revised January figure of 502,000. The February rate for units in buildings with five units or more was 58,000.

 

HOUSING COMPLETIONS Privately-owned housing completions in February were at a seasonally adjusted annual rate of 700,000. This is 5.4 percent (±20.2%)* above the revised January estimate of 664,000, but is 15.5 percent (±13.6%) below the February 2009 rate of 828,000. Single-family housing completions in February were at a rate of 458,000; this is 4.3 percent (±13.7%)* above the revised January rate of 439,000. The February rate for units in buildings with five units or more was 236,000.

Groping through the numbers, about the third time I find myself saying "Oh, this is bad...but wait!  This is good...but no, this is bad..." I start opening cabinets in the office looking for a bottle of el Don.

 

The market futures were up a shade when I looked, no doubt wondering how the Fed is going to do when they announce no move in interest rates.  That's because at some point, with M1-going up at an annual rate of more than 9%, they will have to hint that interest rates will be going up...so the main thing coming with the rate decision will be a gradate-levgel course in FedSpeak.

 

Just leave you right on the edge of the chair....that is a chair you're sitting on, isn't it?

---

The real dance to watch, as reader "Chris from the Prairies" noted is how the US and China are already doing some bashing with each pointing fingers over the pending collapse of the US economy (his read of things).

 

Why all we need now is a nice third party reason for the markets to collapse.  An overt hint from the Fed of higher rates, or what's that? The sound of planes taking off in the Middle East? 

 

The March to Outsource, Redux

The story in the Wausau Daily Herald that "Greenheck expands in Mexico" is not nearly as interesting as the logic of what's going on in the continued flight of American jobs overseas/out of country explained in the accompanying reader news tip:

"Here is some background on this: To keep the number of illegal immigrants down, we need to send our jobs to Mexico. Not unlike the war on terror. You know, bring the fight to them so they do not fight us here. If you look at the figures below, this ONE company has laid off about 400 people in the USA, yet they are EXPANDING in Mexico. Gotta love the humor in this.

 

May 18, 2009, this company laid off 155 people.  Then on August 21, 2009, this company laid off 91 workers that were recalled as summer help. September 25,. 2009, they laid off another 70 people.  Previous to this, they'd laid off 164 people in December 2008.

Say, not to pick on any one company here, but this is a problem of epidemic proportions and congress is doing what about it? Nadda, zip.

 

How old is this getting to be?  Old enough to remember Ross Perot's warning about 'that giant sucking sound'...

---

Related: Three people with links to the US Consulate in Ciudad Juarez (south El Paso) were killed this weekend bgy apparent drug cartel hit teams.

This goes to the idea that a low intensity conflict (LIC) with Mexico is in the process of 'going hot'.

 

Ports Data

So, you're wondering, with all this ongoing export of jobs overseas (or cross border to lower cost labor centers) what's going on down on the waterfronts or major West Coast Ports?

 

Well, figures for February at the Port of Long Beach shows overall 20-foot equivalent units are down 3./9% for their fiscal year to date, but up nearly 30% compared with last year at the same time.

 

Port of Los Angeles is also up only slightly less - about 27% compared with year ago levels.

 

Up the coast a ways, Oakland is up 11% on full inbound with the total handle up 17.2%.

 

Port of Tacoma stats due by the 15th of every month" haven't been updated as of press time.  Check here later, maybe?

 

Ditto, Port of Portland is still counting from February.  Come to think of it, Port of Seattle figures are out yet, but should be posted here one of these days when they get around to it.

 

Key concept: The SoCal ports data looks somewhat improved, although how much is replacement for broken items (to some nominal replacement rate for broken computers, printers and such) and what part is actually growth is a dart through.  But at least not declining for now. 

 

So Much for the Ides

Democracy without voting!  This is a Jim Dandy idea from Nancy Pelosi who the Washington Port outs this morning as suggesting Monday night.  By using a procedural sleight of hand they called it in the WaPo, the bill could be 'deemed' to be passed.

 

This is sometimes called the 'self-executing rule' which - according to USA Today's coverage "is not unusual'.

---

Seems obvious to me, but deeming it a lot less accountable than voting...which is why both sides of the political aisle will likely support this.  It would serve to obfuscate who's really bending over who on this...and that's the way America runs here lately.

 

You and me?  We get a misnamed "Patriot Act" extension and get to prepay before delivery of healthscare while the perps get time to exit.  Congress?  No meaningful lobbyist controls at all.  Repeat after me the Golden Rule": He who has the gold rules.

---

I won't get too upset about this headline - simply because it reveals what we already knew:  "To Close Deficit, Federal Income Tax Rates Would Have to More than Double."

 

Moreover the way The Tax Foundation figures it works out like this:

 

 

I mention the Tax Foundation somewhat fondly, just so you know my reportorial bias to present their data.  In a week or four we'll be reporting their centerpiece which is Tax Freedom Day - the day after which what you make working all year is really yours to spend.  So far, you've been working all year just to pay taxes.

 

Dusty Budgets Department

Another reader tip here (NM from LV, NV) reports:

"Hi George: Just an up date to tell you that City attorneys says the Mayor Oscar Goodman of LV NV can't fire city employees and re-hire them at lower salaries to save a 141 people from losing there city jobs.

Will keep you posted on the craziness."

Yup -  this city budget stuff's getting uglier...

LA Quake & Shake: Interesting Timing

Last weekend part of the discussion on our subscriber side, www.peoplenomics.com, was devoted to the possibility of a major earthquake today (or tomorrow) somewhere like Southern California when a CME's impact from early Sunday is due to smack earth.

 

Just a coincidence I'm sure, but this morning we had a 4.4 earthquake in Southern California more or less on schedule, but at a much, much smaller magnitude.   Still, enough to wake up a lot of folks.

----

Personal note:  This morning's shake was just 7.6 miles from where I was involved in building out a recording facility in the AL area in 2005...and EQ dangers were one of the reasons we moved back to the ranch.  You'll recall that in October of that year we were worried about a pending major quake at 34º North (which is how far North Burbank is).  That turned out to be the 2005 Kashmir quake at 34º29'35" that killed 79,000 and injured more than 100,000.

 

Elaine & I left had Burbank on October 2, 2005 because of the 34º linguistics.  The Kashmir quake hit October 8th - the day we arrived back at the ranch.  Would I do the same thing again?  Hell yes.

 

No, I would not be surprised if this turned out to be a 'preshock' quake. 

 

Reason?  Every time there has been a major quake anywhere near me, I get a feeling of extreme tiredness 12-48 hours before the event. Last night I could barely keep my eyes open even though being nominally well-rested.  So, if we get another 'great quake' shortly, don't say you didn't have at least a clue it was coming...if it does.  It's one of those areas where paying attention to hunches, feelings and 'vibes' means everything.

---

That whole world of pre-knowledge which Cliff digs into a bit via predictive linguistics also surfaces in other ways.  A reader email on point:

"This morning my 7 year old son told his Mom "I had an unwanted dream last night". She asked "Do you want to tell me about it? "No", he replied "I'll just put it with my spam dreams".

Yesterday it was 'speaking in text' in dreams and now 'spam dreams'...if you ever wanted to watch a major consciousness context shift, you have but to open your eyes and behold.

---

You did see where regular lightning in Venezuela has gone missing this year?  Just an El Nino effect, I'm sure...

 

 

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Coping: CT. Truth Leaks

On numerous occasions I have told you about the "gnomes of Greenwich, CT., who IMHO are a more dangerous breed of gnome than event the sinister denizens of Zurich banking.  To reinforce that view, what should come along this morning that a pictorial in the Stamford (CT) Advocate under the headline "The running of the rich: Is wealth changing Connecticut politics?"

 

The median income in Connectedup - for a four person family - is $93,821.  No, I don't make this stuff up - comes right from the US Census folks.

 

Four person families in California come in at $74,801, just to compare...well off, but not quite so flush.

 

Here in the Republic (of Texas) we're a little more frugal at $59.808.  Not saying Chris Dodd country is bad.  It's just statistical evidence that the concentration of wealth in America isn't going away any time soon up in Blue Blood country.

---

But this gets me around to a book that needs to be written for common, everyday folks (like me and you).  The main idea of the book is really simple: Show all the different ways (along with costs) that the rich shelter income from federal taxes and get people to buy them wealth.

 

Just for instance, I've been looking at buying an airplane.  Since I'm self-employed (consulting) I've been looking at modest single-engine planes which could be used to bop all over the country.  Since I'm a VFR-qualified pilot, but not instrument rated yet, could I write off my instrument ticket as a 'business expense'?

 

And what about the cost of the plane itself?  I figure since it's a depreciable asset (and would be used for 100% business use) I ought to be able to write off the plane over some x number of hours of operation.

 

But it gets better:  Fuel, maintenance, fees, taxes - all a write-off if it's a 100% business plane.  So would the local parking/hanger fees...well, you get the picture.

 

Not too much paperwork to it, either.  Since I like flying (fun to do activity) why not find a way for my 'business' to shelter it?

 

Yet deep down inside I know something 'ain't right'.  It takes as much air traffic controller work to direct a Cessna 172 around the sky as it does a Boeing 747.  Plane's a plane at some level (no altitude joke intended...I'm not that clever).

 

So if government was really serious about funding the air traffic control system, you'd think there would be a way to limit aircraft business write-offs to no more than the prevailing first-class airfare between any particular city-pair.  Near as I can tell, there isn't, or maybe I'm dreadfully ignorant, something I come to grips with every day.

 

So what would keep me from buying a $1-million airplane and writing it off over 10,000 hours  ($100 per hour of depreciation) and maybe, oh, what $150 an hour for maintenance reserves?  Then another x dollars for fuel, and then hanger fees, insurance, recurrent training/annuals, and so forth.

 

At the C-172 level I might still be able to operate at the cost of a first class ticket from here to thar, but with a business jet? 

---

Another way the rich get rich is buy lettering renters buy property for them.  You buy a home on the cheap (foreclosure maybe?) then rent it out for break-even or even a very slight negative cash flow. The net result is that you have someone else making the payment on real estate that you own.  I know people that started off with a single beater of a house, worked their way up to small, then medium, then large apartment complexes.

 

Sure, the management problems are a little bigger (and vacancy rates are related to local unemployment variances) but it's one way to the top of the foodchain if you didn't do law school and become a partner early on.

 

I still haven't seen the 'regular human optimized' book on getting and staying rich. 

---

Point is simply this:  The gnomes of (guess which state?  but they are all over the country, just a little more sparse maybe in some parts) have worked all the angles.  Born mostly white, right, and rich they influence national politics for the 'good of the little people' I'm sure.

 

I think it would sure be a dandy ongoing book to collect all the different ways that people get rich and stay rich.  I reckon I spent 25-35 years of my life in one way or another trying to learn the 'recipes of the rich'.

 

If I ever won a lottery ticket (small odds, to be sure) I think what I'd do as a 'next project' would be to write a daily website to collect all the different ways of getting rich and keeping it.  I think that'd be a dandy project since a lot of people could benefit from it. (Submit recommendations here and I'll share them with folks.)

---

We might want to ask if 'rich' going to matter in a year or two?  America looks to me to have hit the nonlinear part of the compound interest/compound debt curve where mass destruction of the economic status quo seems inevitable; either as runaway inflation (my 5:1 favorite) or runaway deflation.

 

Still, I buy a lotto ticket every week or two.  Nothing would please me more than to move to Connectedup, move to the most uppity of neighborhoods, elbow my way into the upscale yacht clubs and such.  You know, just generally cause a gasp of "OMG, there goes the neighborhood, community, or The Club.

 

Be pleased to do it.  Think of it as a public service for bankrupting America for profit.

 

I bet the other 99% of America that has also been victimized by the continuing concentration of wealth wouldn't mind helping do the job, either.

 

I trust you saw the article "218 New Billionaires Averaged $500M in Gains Last Year - How Are You Doing?"  You don't want to look at the Haver Analytics chart in the story  either, or if you do, don't drop by a cordage store (definition 1).  Dream about lunch in Greenwich, instead.

---

Nothing seems to scare the rich and the PowersThatBe more than the "core competency culture" - which we'll get into that more this weekend in Peoplenomics. 

 

Confessions Gone Viral

Want an interesting statistic?  Nearly 300,000 views of the 2007 interview with John "confessions of an Economic Hit Man" Perkins.

 

Damn.  People waking up.  Cool.

 

His book Confessions of an Economic Hit Man is still ranked 1,127 in Amazon sales.  the follow on book, Hoodwinked: An Economic Hit Man Reveals Why the World Financial Markets Imploded--and What We Need to Do to Remake Them is ranked 8,594 in sales.

 

Are You Weed Deficient?

No, we're not talking the kind of weed that kicks up allergies...we're talking the kind that gets people landed in jail in some parts of the country.  The recent article on the Fox News Health Blog "Are you Cannabis Deficient?" raises some interesting questions.

 

All boils down (or burns down?) to this:  If the PTB lose control of taboos, how will they ever be able to grab and maintain kontrol?

 

You see, people only voluntarily give government / the powers/ 25-50% of their income as long as they figure they're getting something for it in return.  "Peace", "security" ,"good government", or "healthcare" has worked so far.

 

But, when they're busy turning public lands into government lands, turning the high seas into government seas, it's increasingly important to issue Prozac and Fluoride than let people brew up bathtub gin untaxed, or pick the plants God/Universe put on the earth unhindered.

 

The question isn't so much who's blowing smoke, but why.

 

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Monday March 15, 2010

Industrial Production Up 1.7% for the Year

Highlights of the Fed Industrial Production numbers today:

"Industrial production edged up 0.1 percent in February following a gain of 0.9 percent in January. Production was likely held down somewhat by winter storms in the Northeast. Manufacturing decreased 0.2 percent in February, with mixed results among its major industries. The output of mines rose 2.0 percent, while the index for utilities rose 0.5 percent. At 101.0 percent of its 2002 average, industrial output in February was 1.7 percent above its year-earlier level. Capacity utilization for total industry moved up 0.2 percentage point to 72.7 percent, a rate 7.9 percentage points below its average from 1972 to 2009. "

Just don't go asking something ugly.  Like "If industrial production is up 1.7% in a whole year, how come the market is up over 40%?"

 

Is the word 'gullible" in the dictionary?

 

Hypodelic Monday

Early on this morning, the market was looking like it would be opening slightly down, but this being Monday and since Mondays of late havge4 had an amazing string of rallies (to the point of statistically improbable, until you get into 'run theory') I'm not planning to do much more than watch.

 

Check back for an update about 8:30 AM which is when the Fed's Capacity Utilization numbers and Industrial Production are due out.

 

The rest of the week oughta be data-laden, too.  We've got building permits and housing starts tomorrow.  Wednesday brings along Producer Prices, Thursday the Consumer Price Index comes out and that's always a fine and  jocular report.

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The reason for the 'new word' - hypodelic - is that there's not a word to adequately describe the battles going on within the ranks of the PowersThatBe.  The factions all have a certain amount of public relations acumen, and since all the factions have heavy-hitter pocketbooks, a certain amount of BS & bluster could be expected in the headlines.

 

One of the areas of conflict is over the whole notion of global warming.  One faction is really selling/hyping it while another faction is actively fighting it which might explain why just before Copenhagen we got the masterfully timed release of the hacked computer data.

 

But the battle over warming is no where near done.  Latest?  "Government rebuked over global warming nursery rhyme adverts" says the UK's Telegraph.  But, at the same time, climate just isn't going away as evidenced in the Honolulu Advertiser today with a "New climate report details extreme risk to Isle birds."

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And so it goes on all fronts, it seems.  Faction X versus Faction Y (or was it  Faction Z?), and all running agendas that go to control, making money and all the power that goes with it.  Start a war, make a buck.  Trade carbon paper, make a buck.  Change healthcare, make a buck.  Yada, yada, yada...

 

Other "hypodelic" issues include healthscare which - to my highly cynical way of viewing things - has to be the best fund-raising scheme the ruling political duopoly has ever come up with.  Grand way to keep third parties at bay.  Oh sure,. the "White House backs down on health bill deals" but at the same time Obama is off traveling today to Ohio trying to drum up support for his plans.  Tra-la, tra-la.

 

Another possible hypodelic? Well, since "Toyota, transport officials unable to spot reported Prius fault" I wonder how much of the Toyota issues recently were about molding American's car-buying choices?  Just have to ask these things, you know....

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Issue after issue seems to be laced with hype - all to divide and conquer and that's whether as a consumer, voter, or what the spin docs call any other definable persuasion block or psychographic... It's a real testament to the amount of information required by the global excess of information that leads most to 'overload' at one level or another.  (Although you may not be conscious of it, which is really the whole point, then, isn't it?)

 

Around here, the solution is to watch less TV, step back from all the hype and ask "What's really important here?"  Stock futures are down but with lots of numbers this week - including industrial production and utilization in a few minutes, I find myself feeling detached and watching what's either a snake chasing its own tail, or a merry-go-round where the same stories get recycled over and over again to the point of dizzying nausea.

 

Consider it a friendly reminder to be very care not to overdose on hypodelics.

 

War Watch/Our Glowing future

Wondering how Israel will bomb Iran's nuke facilities?  Well, here's a curious story about how bunker-busters are reportedly being shipped from California to Diego Garcia.

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Normally, this would not be news, but I expect the reasons the PTB have let this one out is so that when Israel attacks Iran (as I assume they will use a few low-yield nukes for the most worrisome targets) Israel will be able to point at stories 'in the wild' (like this one) and claim "It was all conventional munitions - those radioactive plumes are from all the nuclear materials that Iran was secreting away..."

 

I mean, if I were just guessing...

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And if you're wondering what's really ahead, remember those million books from the Manchester Library are going into old salt mines before summer.

 

Is this the part where I also mention the "coincidental timing" of stories like the one out last Friday in the Christian Science Monitor about the progress being made stocking the Savlbard Seed Vault up in Norway?

 

No worries...nothing to see here...ya'll just move along...just old George-the-Nutter tilting at windmills.

 

That "Fungus Amongus"

There are occasional web bot hits that come along that we don't hold up and say "See?  Told yah so!" but the write up recently in Wired about the problems of the Ug99 fungus, which is ravaging grain crops has the potential to bring mass starvation/famine with it.

 

Linguistically, this is a 'biggy' to keep an eye on since we've had a couple of years of lead-time on it and in modelspace, the more lead-time, the bigger the problem is when it shows up.  Unless you're gluten intolerant, of course.

 

So Much for Retirement, Department

You see where the city of Prichard, Alabama is now 6-months straight of not being able to pay retired city workers their pensions?  City's in Title IX bankruptcy...

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Is this the part where you tell me "No, George, this is not the Second Depression - you're just fear-mongering."  Oh?  Really?

 

High Court Politics

Oh my, the headline in the LA Times that a supreme court "Justice's wife launches 'tea party' group" certainly raises a few questions about impartiality of the high court.

 

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Coping:  About that "Sunny" Disposition

A reader who has been paying attention to our discussion about how the Sun may play into future human events in a major way has been doing a bit of research and offers this:

"Hello clif & George,

 

Here are some interesting points to noodle over while not in nap time:

 

From Space Storms and Space Weather Hazards [PDF] p.244:

 

In particular it is striking that the minimum geomagnetic activity during the recent solar cycles at the end of the century is comparable to or even larger than the geomagnetic activity measured at solar maximum during the beginning of the century. This indicates that during the last century a fundamental change of solar surface activity has taken place, which is not noticed in the sunspot number.

 

 

Proof the sun is winding up?

 

-- AND – from p. 312:

 

 

Seasonal averages of E>2 MeV electrons (1992-1999) showing much higher average

fluxes near the equinoxes than near the solstices [from Baker et al., 1999].

 

It would appear that we’re more likely to lose satellites during the equinoxes.

 

BTW, have you noticed the Solar Radiation Storm we’ve been experiencing since 12-Mar?

Yes, indeed, some very interesting data to ponder, especially since we are seeing lots of headlines that reassure us that while there's some 'new' kind of behaviors being noticed by the Sun, nothing to really worry about.

 

Examples: "Why is the sun producing so few sunspots?" and "Magnetic flows cause sunspot lows, study shows."

 

All of which would be a kind of ho-hum, yeah that's interesting but who really cares...until...you read further and start piecing together a question that goes something like "If the sun's magnetic fields are changing, could there be a big action-at-a-distance implication for a planet with a mostly molten iron core?

 

Think the people Chile and Haiti may have an answer there.  But, just in case, a Presto alert was issued yesterday for a CME due to arrive at Earth along about Wednesday of this week...so might there be a big quake in the next couple of days?  We'll be watching....

 

Peoplenomics Follow-up

Meantime, a Peoplenomics subscriber wrote a very good - and thought provoking - email about a hypothetical sequence of events that could happen this year including the possibility of a major West Coast earthquake I described (again hypothetically):

"That shaking had lasted several minutes and later analysis of the data would indicate that it was a 8.9 magnitude quake centered in the Sherman Oaks area."

I would like to call your attention to:

Magi 6.0 - 7/3/09 -  25° 7'48.00"N - 109°45'0.00"W
Mag 6.9 (group of about 3, this was the largest)  - 8/3/09 -  29° 2'24.00"N - 112°54'0.00"W,  31 Days and 332 statute miles later.
Approx 6 Mag 4.1 to 4.6 - 10/8/09 - 10/16/09 -  30°59'30.94"N - 113°46'32.79"W, 66 Days, 144 miles since the 8/3/09 group.
Swarm -12/30/09 -  32°28'57.73"N - 115° 9'28.36"W, 83 Days, 128 miles from the 10/8/09 group. 

North of here is the "wrench fault" area of the San Andreas, you know, that part that is locked.  In a wrench fault, part of the land subsides (Salton Sea... where a separate swarm has been ongoing for about 2 years under the south shore), and other sections are pushed up into transverse Ranges such as San Bernardino, San Gabriel, Santa Monica, and Sierra Pelona Mountains, the Simi Hills, and most importantly, the Tehachapi Mountains.

The Tehachapi is most important since ALL of LA's water either goes over (pumping stations) or around this range (Owens Valley).  The Tehachapi are also the de-facto southern end of California's Central Valley.  North of it Geologists have identified a lithospheric drip coming off the bottom of the Sierra Nevada mountains, and has probably contributed to the formation of the valley.

The other aspect of it, is that in your scenario, this range is about where your LA quake is positioned.

Now, why did that get my attention?  Those quakes I mentioned earlier... They have been progressing up the boarder of the Pacific and north American plate as regular as clock work.  If you do a time-distance on this "stress front" it was moving at about 10.72 mi/day, then slowed to about 2.19 mi/day, and finally to 1.55 mi/day as it encountered the multiple fractures of the San Jacinto, Elsinore, Coronado Bank, San Diego Trough, and San Clemente fault areas, all which move stress around the locked San Andreas at this area.  Most of the activity of this "stress wave" is seen on the San Jacinto fault.. with a few odd ball 4.0's and such appearing on what is likely an extension of the Elsinore down in Mexico, and possibly one of the oceanic faults further south near the same Latitude.

Remember, this is just some observations and wild arsed guess.  Now.. IF the "stress wave" idea is sound... then the stress zone is likley near Baldy Mountain in Southern California, and will be in the area you mention in your scenario around July, and should have moved north of Pasadena to near Santa Clarita by around the 1st of July 2010... at it's apparent rate of movement.

Unsuccessfully, I tried to get an eyeball on it by setting up a query to the USGS servers and making a plot out of it.  It really shows nothing more than normal quake activity by the way I see it.  Here's the graph.  I intentionally set the bounding box to exclude the Salton Sea  quake swarm... like I said, it's been going on for a while now.




I also noticed that you mentioned Hawaii.

You do know about "The Great Crack" right?  It's larger than the one that the Tee Vee is always yammering about over at the Canary Islands.  It stretches from Palima Point at  19° 9'40.66"N - 155°26'12.91"W and runs about 20 miles North by North East to the area of Kilauea crater.  The Hilina Pali scarp is to the South East of it.... From Wikipedia: "On November 29, 1975, a 37 mile (60 km) wide section of the Hilina Slump plunged 11 feet (3 m) into the ocean, widening the crack by 26 feet (7.9 m). This movement caused a 7.2 magnitude earthquake and a 48 foot (15 m) high tsunami."

Keeping that in mind... refer to the Tuscaloosa Seamount, formerly part of Oahu.  This 10 mile wide chunk of the island broke off over 1.5 million years ago and slid 50+ miles out to sea.

Just stuff to ponder....

Yeah, sure as hell is.  Especially because we have 4-5 Great Quakes due linguistically this year...

 

Monday's Stretching at the WuJo

Had an interesting email from a reader overnight which sort of ties in the with the 'building tension' period we are in through early July:

"July 4th, 2010 is the next September 11 event carried out by a secret government

 

Here how it work:

 

-First step is to a cause 9/11 truth movement to fight against the government, this is the first step of the government.

 

-Then the next second step will be word of war upon Tea party and coffee party and many new group movement maybe by april or may

 

-Finally the final step the government will do is to blow up washington D.C. somewhere in lincoln ave. (planted by the government) then the new media will lied about who planted the bomb, a 9/11 truth movement or tea party or some anti-government involved and also must be a ex-army who work for the government and somehow got a nuclear device

 

-Then the government will declared anyone a terrorist if no one accept a new technogoly (mark of the beast style) so the government need the people's trust, if you don't like the government, you will be send to the fema camp or something else and blame anyone who refuse the "government's mark", there will be marital law, police control

 

I cannot tell you how I know this, but I can give you a hint: I found this information somewhere in youtube, Look up "9/11 in hollywood" and (this link) explains why I talked about July 4th, 2010

 

If you think this is a joke, then fine, but don't said I didn't mention any of it

 

Everything will come clear"

This video, in case you don't have broadband, takes what seems to be an X-Files sequence and then reads all kinds of hints into it about a supposed event to come in early July (4th?) of this year.

 

The problem with such efforts is that given enough zoom-in capability and a calculator, I could find what might seem like meaningful relationships between almost any movie and future (or past) events.  I mean, I've already assumed that I'll have to watch Alice in Wonderland in order to get the MK Ultra implications, right?

 

Still - skeptical though I am - it'll be interesting to watch the date come and go.  The curious timing of "Lord of the Rings: Two Towers", for example, was curious.  And then there was the case "The Coup" album cover done ahead of the 9/11 attack which was written up in Wired within days of 9/11.

 

Whether Hollywood knows anything in advance of events, or whether it's just a case of leaky archetypes, we'll learn later on this year.

 

Speaking in Text?

As long as we're doing "Monday at the WuJo", perhaps you'll also want to masticate on this:

"Hi George,

You spoke last week of how new words phrases, or ideas come around as time passes & technology changes. This one was a new one for me & I'd be interested to know if this phenomenon has come past you before.

I went out of town with a friend & her daughter (16 yrs. old) this past weekend & heard something that was quite incredible to me. As my friend & I were visiting late (we shared a hotel room), her daughter fell asleep beside her. I found out that this young lady talks very plainly in her sleep on a nightly basis. BUT, when she speaks, she talks in text (yes, as in texting). She is a very intelligent young lady, is extremely hard working, ahead of her class, etc. Anyway, as we were visiting, I heard her say OMG (she spoke the letters) you can't believe what I saw learned today, LOL (again she spoke the letters). I was very surprised to hear such clear speech, not to mention the 'text' talk! I asked her mom about this, & she acted as if this was normal & said that all of the 'sleep' conversations that her daughter has, are spoken in the same way. If it can be abbreviated in texting, then that is how she speaks in her dream state. Heck, in high school, we were excited to get electric typewriters! I never imagined in my wildest dreams wanting to 'type' on a phone!

I guess that some new technology is even invading the subconscious thought process now.

Thanks for the thought provoking humor, the insight, & the occasional (but more frequent lately) heads up! Or should I say 'Duck & Cover'.....

N-o-,-I h-a-d-n-'-t h-e-a-r-d- o-f i-t-.  But takes a lot to sujrprsie me.  When it shows up at revival meetings and in hypnotic regressions, get back to me.

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But, speaking in/of which:  What IF texting is just an intermediate step to creating humans that will be melding (Transformers style?) into a hybrid between machines and humans?  Just thinking...when the 64-bit humming begins, I'm out.

 

When Realities Collide

Remember a while back we had the email from the fellow who was following an old car down the road and it morphed into a late model Camry right before his eyes?  I keep forgetting to pass along this email which is along the same lines...

"Hi George,

 

My husband introduced me to your web site and I have been reading it for about a year. A Little while back there was a write in about an incident of the weird happening to a gentleman who was driving home and watched an El Dorado change before his eyes. It and another incident of the weird, got me thinking about something of the like that happened to me last summer.

 

Here it goes: It was about 9am both of my young kids were playing in the living room, windows were all open and it was nice and sunny. I was in the kitchen doing some cleaning, watching my kids thru the doorway and what we like to refer to as the drive thru window. Then I started to notice shadow people running around in the space between me and my kids.

 

It was like watching an old fashion film strip with my kids as the back drop. The shadows were human shape but moved to fast to catch any detail. The shadows were just running around and doing their thing. My kids did not seem to notice them or just didn't care. We continued the day like any other, and went out to the deck for water time, and I would occasional look in or come in to get something and the shadows continued to just run around.

 

If memory serves they finally went away in the late afternoon, say about 4pm. We have nothing in or out the house that would have produced what I saw. In fact I have seen them, for a short time walk past our deck door, while I and the kids were inside. Still not sure what to think of it, but just take it in stride with all the others.

 

Winter has been fairly quiet, but now the snow is starting to melt here and the activity just started up again. Couple days ago I was making a grocery run at night when I had two hand push on my back, right below the shoulder blades. I could feel the finger tips, and it was hard enough to get me looking behind the driver’s seat to see who was there. No one there. Well thought I would share my experiences. Your thoughts are much appreciated. Keep up the great work. "

The concept here is that two whole Universes collide periodically and there's a whole 'other world' on the other side of it with 'beings'.  One of the theories is that aliens (grays mostly) are from this otherspace and some have figured out how to transit between the two universes.

 

Cliff's planning (when time permits) to put an extract up on the free part of his site about the "hyperchroniac" experience and to my way of thinking, this may be a related phenomena, even if only tangentially so.

 

The problem seems to be that there is so much experimenting/work being done with time-manipulation that hyperchroniac experiences are apparently on the rise...they're when time either gets really, really slow - and you get HUGE amounts of work done in almost 'no time', or if there's not enough 'time stuff' around, you work hours and hours and yet nothing seems to get done.  Couple this with a few shadow people, morphing Caddies into Camry's and you've gotcherself a fine kettle of fish that will be hard on people not understanding.

 

Fortunately, along comes Tim Burton with a perfectly timed movie which is almost a formula for coping with a drugged out/drug-out, compressed while we're at it too world with Alice. 

 

To borrow a Twilight Zone phrase "At the signpost up ahead...a rabbit!"

 

And Then Things REALLY Get Weird

The headline "We are not alone." says NASA Veteran"  makes for a good read if you're having a slow/lazy Monday.

 

And that article in turn leads to McClelland's website here.

 

So, was it Alice who was 10-feet tall and playing in the Shuttle cargo bay?

 

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