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Archive for the Economics Category

Is College Worthless? (July 25, 2011)

Posted in Economics, Education, Pogo Plight, Schooling, Society on July 25, 2011 by e-commentary.org

. . .

_ “Kinda. In the past, a college graduate acquired more money and flashed a brighter smile. For most kids today, it is four years of fun and play. A sheep skin really only signals that the bearer attended a summer sleep-away camp during the fall, winter and spring seasons for a few seasons.”

_ “Employing a generous standard, perhaps ten percent of the kids actually acquire something tantamount to a “college education” in college.”

_ “The economy has upped the bar. Ninety percent of the college graduates are not employed in college-level jobs because they are college graduates but not college-level employees. Viewed with some perspective, everything is in balance except our unreasonable expectations.”

_ “When you think about it, wouldn’t you party all night if you had no tomorrow?”

. . .

_ “When the federal government began making college loans freely available, the cost of college schooling exploded. A college may aspire to liberate one’s mind, but it enslaves one’s body and spirit. The lucky graduates leave as indentured servants, the unlucky ones as debt serfs and slaves. The only out is to enlist in the military. Is that the plan? Think about it.”

_ “And by statute, a student loan obligation is not a dischargeable debt when one files bankruptcy. But doesn’t a constitutional provision trump a conflicting statute?”

_ “That’s what they say.”

_ “What about the 13^th Amendment prohibition on slavery?”

. . .

_ “The greatest constitutional challenge in academia today is dealing with the cohort of male applicants who are significantly less prepared and talented than the cohort of female applicants. Can a university elect to maintain an equal number of boys and girls and accept a marked disparity in abilities and possibilities within a class?”

_ “The most talented and most desired female applicants may elect to matriculate at a university that maintains a balanced portfolio of males and females. To attract the elite women, a university may be compelled to admit even more less qualified males to maintain a balance in the entering class.”

_ “Remember in the old days when there were single gender schools and an opposite single gender school situated down the road.”

. . .

_ “Why not award every citizen a Ph.D. in any field upon reaching the age of 18. And of course award everyone a Selective Service card.”

_ “The Adult Entitlement Act of 2012 will save billions. In the legislation, the Department of Education can be renamed the Department of Schooling or the Department of Credentialing.”

_ “We need a little something for everyone. Academia is more interested in credentials than ideas. Double the number of degrees currently sported by each professor by fiat.”

. . .

_ “Society does not have the resources to indulge the current college extravaganza. No one should be admitted to college until the age of 20. Everyone should work at something for two years as an intern, in the civilian conservation corps, even in the military or at some other endeavor. At that time in their lives, kids need a more productive emancipation from home and a swifter introduction to the real world at less social cost. By the age of 20, both males and females have much more perspective and maturity. They can use their earnings or learning chits for education or for some other endeavor.”

_ “Kids must learn how to get out of bed on time before they can learn.”

_ “And learn to cease texting while at the morning staff meeting. Traditional college attendance would decline. The dorms could be used to house a mix of college students and kids pursuing their Big Transition and senior citizens and others in need of housing.”

_ “And perhaps the number of qualified males will balance the number of qualified females.”

. . .

Bumper stickers of the week:

Go College

Phil O. Sophistry, B.A., B.A., M.A., M.A., Ph.D, Ph.D., B.M.F., B.M.F.

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Bringing Balance To The Balanced Budget Amendment Debate (July 18, 2011)

Posted in Balanced Budget Amendment, Congress, Debt/Deficits, Economics on July 18, 2011 by e-commentary.org

. . .

A “Why pass an amendment demanding that you pass a balanced budget when it is far easier simply to pass a balanced budget. If you want to pass a balanced budget, then pass a balanced budget.”

B “There is a simpler and more concrete solution. No balanced budget amendment bill shall be even scheduled for a subcommittee hearing until the budget is first balanced.”

C “If it can’t be done, why pass a law decreeing that it shall be done. It really is as easy as ABC.”

. . .

Bumper stickers of the week:

Which came first, the rattlesnake or the egg?

The Japanese women won (in soccer), but Japan is lost

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Our “Fiat Future” (June 13, 2011)

Posted in "Fiat ______", Banks and Banking System, Debt/Deficits, Economics, Gold Standard, Peak Land, Peak Oil, Spending on June 13, 2011 by e-commentary.org

. . .

Y “So we live in an economy driven by ‘fiat money.’ Should we use the money to buy a Fiat car? You know it is an acronym for ‘Fix It And Trade’?”

X “Our fiat currency rolls along, but it is not a convertible vehicle. I would like to fix it and trade, but we are just trading it. A ’fiat’ is an order and a directive. The United States Government orders and directs the citizens to accept ‘fiat money’ or ‘fiat currency’ or ‘fiat dollars’ for ‘for all debts public and private.’ The order and directive are backed by the ‘full faith and credit’ of the United States Government. See, no worries.”

Y “But I’m worried. The credit of the United States government on paper is non-existent. Why take its paper? Who has even ‘half faith’ in its credit?”

X “Only fools and citizens. Only you and me.”

Y “Why have faith when the empirical evidence is so clear and so clearly to the contrary?”

X “Think about it this way. I will accept the dollar if and because you will accept the dollar.”

Y “Well then I will accept the dollar if and because you will accept the dollar.”

X “That is the rationale. It has worked and it works, but it may not work. I don’t know if I want to accept the dollar.”

Y “If you want to get rid of them, I will take them off your hands.”

X “I will use them for the time being if and because you will accept them. Half of the physical dollars are in circulation outside the United States and serve as the de facto currency in some countries and regions. At the same time, the banks and financial institutions in America may have one tenth of one percent of the physical dollars necessary to cover the deposits in the banks and financial institutions. Our fractional-reserve banking system is fractured, but it has not yet fractured. A run on the banks, for rational reasons or irrational whims, would confirm what no one denies.”

Y “So is the refusal to raise the debt ceiling a rational or an irrational triggering event?”

X “An understandable reaction, but an irrational and dangerous response. In a country awash in electronic dollars, there are no real dollars and not even enough fake dollars. When the populace resorts to gold, everyone will discover that it is ‘fiat gold’ even if we are not ordered and directed by the government to accept it.”

Y “The government took gold out of the equation decades ago. And if you want to get rid of any gold, by the way, I will take it off your hands.”

X “Others have put their full faith and credit in gold. And then fail to see the irony in denominating the value of gold in . . . ‘fiat dollars.’”

Y “So the dollar is not backed by gold, but gold is backed by dollars.”

X “Seems to be. However, there is no fiat bread.”

Y “So when everyone realizes that the government ‘bread’ is stale, we will yearn for real bread.”

X “Bread is the real bread. But we can’t print it.”

. . .

Bumper stickers of the week:

Bake Bread

Know how to bake bread

He Who Has The Gold Makes The Rules

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The Silent Takeover (May 23, 2011)

Posted in China, Cyberactivities, Economics, Foreign Policy, Locke Gary, Middle East, Military on May 23, 2011 by e-commentary.org

. . .

C1 “Take over America. Of course we are. You say that you have a better plan, comrade.”

C2 “The primary lesson of the Twentieth Century is that it is easier to take by investment than by invasion.”

C1 “Clear thinking, little butterfly. Invasion is costly and ineffective. Invasion only assists the defense industry. You can eat butter; you can’t eat a gun. We focused our spending on efficient invasion technology. We are letting the Americans spend on offensive technology to allow them to go bankrupt.”

C2 “They are already bankrupt.”

C1 “They are. They are also too big to fail, but not too big to own and operate efficiently.”

C2 “Increase the purchases of t-bills and t-bonds by another fifty percent to a holding of 1.5 Trillion U.S. They will be worthless, but they are one of the tickets to control.”

C1 “We will decide what they are worth later.”

. . .

C2 “America has an unproductive class of third-rate minds and fifth-rate characters who suck staggering amounts of money without contributing anything of value. They are identified as CEOs, CFOs, COOs, and their like and ilk. They run companies and run them into the ground.”

C1 “Comrade, we plan to teach them how capitalism really works. Survival of the fittest. They are not fit. They will not survive.”

C2 “They do not have a working market for talent at the top of American corporations. The market is broken . . . and fixed. The brigands and hooligans run the companies. The American schooling institutions feed and fuel the broken market.”

C1 “The brigands and hooligans will be fixed like the mongrel dogs they are. They will be sent to regional re-education camps . . . to be re-educated.”

C2 “Were they ever educated?”

C1 “Very good. You will go far. What about the cyberfun we are having with them.”

C2 “You should taunt them with simple technology and gauge what they have to combat the efforts.”

C1 “We can send a message internally to the Seventh Fleet to ‘stand-down’ at any time that looks like it is one of their own. We can even send a message to have the crew stand on their heads.”

C2 “We can? What will you do with the people? The people do not produce.”

C1 “They produce but not products. We provide the goods and the money to buy the goods for now. They will be allowed to consume as long as it is in our interest to allow them to consume.”

. . .

C2 “Soon the Middle East will be our challenge.”

C1 “A problem not a challenge. It is now an American problem and will remain an American problem. America has a place in the world and a role to play.”

. . .

C2 “We have our own domestic problems.”

C1 “Not if we don’t acknowledge them.”

C2 “Look at the problems we don’t acknowledge.”

C1 “Who asked you?”

C2 “Our comrades are becoming . . . filthy running dog consumers. We are creating our own mess.”

. . .

C2 “I have another plan. What if we tried to work with them? Why don’t we have a beer with Gary.”

. . .

Bumper stickers of the week:

Is it possible to go through the day and encounter something or anything not made out of oil and not made in China?

Gary Locke – nominated to be the Ambassador to China. O’Bama’s most astute and foresighted appointment.

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On Trading Off (May 9, 2011)

Posted in Economics, Energy, Environment, Global Climate Change, Global Warming, Housing, On [Traits/Characteristics] on May 9, 2011 by e-commentary.org

. . .

X “I gave a neighbor a few dollars a few years ago not to cut a tree on his property that provided ample shade for my house and a sylvan view for me.”

Y “You paid for what they call ‘borrowed landscape.’ You receive a pleasing view that someone else funds and maintains.”

X “He pays the taxes and I rake the leaves within the drip zone.”

Y “Anything in writing?”

X “Just a handshake deal that has worked so far. The tree shades the house from the sun and lowers the electric bill. Now I need the energy from the sun to hit the house and lower the electric bill. The solar panels are wired in series and when even small areas of a few panels are shaded they produce less electrical output. I plan to approach him and see if he will let me cut the tree. He installed a back up wood stove last year and may now allow me to cut it if I give him the wood in sixteen inch lengths. That would work for me.”

. . .

Z “We debated the proposed microhydro project last week. It is hard to be in favor of microhydro at the public forum on alternatives and then against microhydro at the fly fishing club meeting.”

Y “Hard to have hydro without hydro.”

. . .

Z “It looks like I am saving the planet until you look at all the costs. ‘Emergy’ is all the embedded energy in an item. The measure incorporates all the energy to produce and consume it not just my cost of acquisition and consumption. Weighing everything, the decision is not as clear.”

. . .

X “The community council seeks to impose height restrictions on buildings and also require more substantial setbacks from the street. A building must go up or go out.”

Y “They may be against buildings. A building can’t go up if it can’t go up or go out.”

. . .

Z “Do you support a local farmer who occasionally indulges some pesticides or a distant organic farmer?”

. . .

Y “Providing fewer parking spaces won’t reduce the number of cars. Providing more sidewalks may increase the number of pedestrians. However, aren’t you simply substituting concrete for tarmac?”

. . .

Bumper stickers of the week:

Medium Is Beautiful

Eat Mangoes Naked

Sawgrass Is Popeye’s Spinach On Crack

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“Fiat Gold” / Fool’s Gold (May 2, 2011)

Posted in "Fiat ______", Depression, Dollar - World's Reserve Currency, Economics, Gold Standard, Recession on May 2, 2011 by e-commentary.org

. . .

F “Remember that back in 1933, President Franklin Roosevelt confiscated all gold, devalued the dollar and decreed that the United States no longer allowed U.S. citizens to convert dollars into gold. On August 15, 1971, President Richard Nixon decreed that the United States no longer allowed for the convertibility of the dollar into gold. At the same time, federal spending and dollar creation grew and continues to grow exponentially. Gold is an unworkable and irrational benchmark and restraint, yet it was a brake.”

G “You still believe that the rest of the world will decree that the dollar is no longer the world’s reserve currency.”

F “Don’t lose faith. In time, it is only a matter of time. Even with careful explanations, the public will not understand the consequences. If there is a ‘slinky slide’ rather than a sudden drop, ‘fiat dollars’ may be accepted for a few months or perhaps longer if there is still some residual faith in the greenback. The buck is familiar and will be readily available, but it may stop here. Some members of the public will shed their habit and shift their faith from ‘fiat dollars’ to gold and silver.”

G “Moving from money to Morgans.”

F “Then the Great Revelation will be revealed when they discover that they are now holding ‘fiat gold’ and ‘fiat silver.’ The half life of the fascination with the shiny stuff may be two or three months. Then everyone will discover that the stuff is generally useless, although gold may be useful for some electrical connections and silver for our electrical devices.”

G “And maybe the stuff is not really as necessary if there is limited delivery of electricity.”

F “A garden shovel will be much more valuable than a golden bar.”

G “And knowing how to use a garden shovel.”

F “And being physically able to use a garden shovel.”

. . .

[See the “e-ssay” titled “Is The Gold Standard Really The Gold Standard? (January 18, 2010)”]

Bumper stickers of the week:

Why is gold always priced in . . . dollars?

Fiat = Fiat = ?

All that glitters is not a medium of exchange, a store of value, and a unit of account.

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Walmart’s Classy Action (April 11, 2011)

Posted in Courts, Economics, Monopoly, Supreme Court on April 11, 2011 by e-commentary.org

. . .

E “It keeps getting more surreal. Walmart whined all the way to the Supreme Court recently that the proposed class of individuals joined in the discrimination law against it is too big.”

F “So Walmart promotes judicial activism?”

E “Or is it an admission by Walmart that Walmart is too big? Walmart could divest itself of a few of its divisions. Or enter into a ‘consent decree’ with the Antitrust Division of the Department of Justice and down size.”

F “Is a ‘consent decree’ one of those legal things that allows an entity to maintain that it did not do anything wrong in the past and it agrees not to do it ever again in the future.”

E “That’s the animal. A female spokeswoman with Walmart stated that she never experienced any discrimination while working her way through the Walmart hierarchy.”

F “But she is not a proposed member of the class?”

E “Nope.”

F “What’s the problem? Seems fair that she is not part of the class. Large companies with large numbers of employees may have large classes.”

. . .

Bumper stickers of the week:

Large is good?

Radiation is democratic and dismayingly indifferent

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“Peak Land”: The Exodus Toward The Equator . . . or the North Pole? (April 4, 2011)

Posted in Consumerism, Depression, Economics, Global Climate Change, Global Warming, Housing, Peak Land, Population, Recession on April 4, 2011 by e-commentary.org

. . .

7 “Look at the movement of the ‘center of population’ or the ‘median point’ of the population in America over the decades. Opportunity, open space, sun shine, clean air, air conditioning, ‘right to work laws’ and lax state environmental and occupational regulations attracted individuals and businesses to the western longitudes and the southern latitudes of America. The center has moved from Maryland to Missouri. In the coming decades, the population will need to migrate closer to the sun which on this planet means closer to the equator.”

13 “Not enough dead dinosaurs. The decline in fossil fuels will drive everyone crazy and may drive them to drive south. About ninety percent of the Canadian population lives within one hundred miles of the United States border. They can’t move far and remain Canadians. We will need to move south. However, people will not have the electricity to condition the air.”

7 “Americans are drifting toward the southwest, yet they cannot live and work there because of the limited water supply even if photovoltaic cells are welcome and promising. The populace may end up moving to enclaves in Oregon.”

13 “Then we bump into another limit. We as a people have always lived at ‘peak land’ because the total number of hectares is finite and known.”

7 “With the rising seas reducing the land mass.”

13 “Exactly. I look at the globe and a map differently. I see a narrow undulating band of livable land that does not demand the consumption of substantial deceased dinosaurs to stay warm, offers adequate water supplies and provides locally grown food. The sustainable plat on the planet is contracting. Even rising temperatures will not be enough to offset the prohibitive costs of heating cold regions and handling short growing seasons.”

7 “Yet as the perverse insulation envelops the Earth, northern climes may become temperate climates. Canadians may be well positioned.”

13 “All the rates of change are in flux and uncertain. We are now moving from ‘peak land’ to scarcer land.”

7 “We are on the wrong side of too many tipping points. Usable land is contracting while the population is expanding.”

13 “While the population is exploding. A friend estimated that the city will reach five hundred thousand residents by 2030. I observed that the city would need to contract to fifty thousand residents at most. He was nonplussed and added an aside about the birth rate. I agreed that we are over gross and getting grosser. Nonetheless, our numbers must shrink and migrate. He remained nonplussed.”

7 “For most people, it does not add up. They aren’t even doing the math.”

. . .

[April – National Poetry Month]

Bumper stickers of the week:

A half dozen six-word memoirs in an “e-poem” titled “Take only pictures; Leave only footprints.”

Many live humans; Few dead dinosaurs.

Disregard the e-con-omists; Regard the physicists.

Change your attitude; Range the latitudes.

Pay old bills*; Develop new skills.

Consume less junk; Savor more beauty.

So many challenges; So little time.

* Craft your own financial game plan. With hyperinflation on the way, purposefully delaying the payment of bills allows one to pay obligations with significantly devalued dollars. That is the strategy being pursued by the governments.

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Is A “Strategic Default” Of A Mortgage Now A Moral Imperative? (February 28, 2011)

Posted in Bailout/Bribe, Banks and Banking System, Courts, Crime/Punishment, Economics, Housing, Kleptocracy, Law, Society, Supreme Court, TARP on February 28, 2011 by e-commentary.org

. . .

S “You have heard of them. A ‘strategic default’ is a default by a person who could make the monthly payments on the mortgage yet elects to cease making the payments because the property is underwater financially.”

D “There are a flood of them today.”

S “A strategic default may be de rigueur today. Look at the law. Start with the indoctrination process in law school. Young law students are taught the theory of ‘efficient breach’ which counsels one to breach a contract if breaching the contract is worth more than performing the contract. That is defined as ‘efficiency.’ The students who answer obediently get on the law review, clerk for the Supreme Court and make millions representing banks, big businesses and insurance companies.”

D “And assist in running them into the ground.”

S “That’s the plan. They don’t even understand ‘efficiency.’ In practice, the party breaching the contract is not spawning a more efficient use of global resources. The breaching party simply does not want to pay or perform and usually has far more money and can overwhelm the non-breaching party in court. The party not receiving payment or performance loses big and usually has little judicial relief.”

D “With a few exceptions, the legal system seems to exist to protect and serve the interests of the wealthy and the well-connected. I’ll take my direction from no one other than the MBAs at the MBA (Mortgage Bankers Association) who recommend defaulting on your mortgage if it is not working for you. The banksters decided not to pay the mortgage on the MBA office building in D.C. (Washington, D.C.), even though the group had the funds to pay. The banksters strategically defaulted.”

S “They are indeed an example for all. When the government bribed and bailed out the banks and other institutions, some contended that the government could not breach the contracts providing for unwarranted and illegal bonuses. How un-American. The government should have disregarded every contract and required the banksters to bring suit. How American.”

D “Allowing the banksters to file suit would allow them to file in a sympathetic Republican Federal District Court and possibly steer the case to a receptive judge.”

S “Always a risk in the legal game. However, before the banksters brought suit, their legion of lawyers would remind them that they could confront defenses and counterclaims. In court, the government could assert a dozen affirmative defenses and also counterclaim for fraud, deceit, perjury, conspiracy, embezzlement, racketeering, misrepresentation, breach of fiduciary duty, obstruction of justice, etc. Some of the banksters would not file suit which is the least expensive and, yes, the most efficient way of reaching a just resolution.”

D “Seems that the courts are stacked against the public. Nonetheless, there is a small chance that an independent judge might hear some of the cases and hold that the bonuses are illegal. An affirmative award against the banksters is improbable but not impossible.”

S “Neither the Republicans nor the Democrats ever intended to bring criminal charges against the criminals. We seem at times to be alone in a lawless world with millions of laws on the books. We in America have moved from a democracy to a kleptocracy.”

D “And no one to throw the book at them. Except that the law and morality are clear. Homeowners are morally obligated to default on the payment of their mortgages if the property is underwater financially. The government is morally obligated to default on the payment of the bankster’s bonuses. In today’s amoral America, a strategic default is both an economic necessity and a moral imperative.”

S “Perhaps a provision should be added to Title 18 of the United States Code making it a crime not to strategically default if the property is underwater financially. Not to strategically default is so un-American. And inefficient. We just can’t have that.”

D “Strategically defaulting immanentizes the eschaton.”

S “Indeed.”

. . .

Mortgage Bankers Association Defaults: http://www.thedailyshow.com/watch/thu-october-7-2010/mortgage-bankers-association-strategic-default

Home Sales Data Is Overstated: http://online.wsj.com/article/SB10001424052748704476604576158452087956150.html

“Three years after a horrific financial crisis caused by massive fraud, not a single financial executive has gone to jail, and that’s wrong.” Charles Ferguson upon receiving the Oscar along with Audrey Marrs for the Best Documentary for the movie “Inside Job.”

“Almost everyone counted publicly each and every single day of the event known as the ‘Iran hostage crisis,’ yet no one is counting publicly the days that have passed since September 15, 2008 without a single major criminal indictment of the banksters and their ilk who caused the financial crisis that continues to plague this country today.”

[See the “e-ssay” titled “1000 AUSAs (February 9, 2009).”]

Bumper stickers of the week:

Do as I do not as I say

Mortgage Bankers Association: Strategically Default Today

Free $1000 an hour legal advice: Strategically Default On Your Mortgage Today

Efficiency uber alles

Efficiency is Inefficient

If your property is underwater, should you plant seaweed in the front yard this spring?

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O’Bama Revisited (January 17, 2011)

Posted in "L" Shaped Economy, Bailout/Bribe, Economics, Federal Reserve, Military, O'Bama on January 17, 2011 by e-commentary.org

. . .

F “Cold day on the Mall two years ago. Can’t say that things will be much warmer this week.”

G “It’s still cold and is getting colder. The day will live in infamy. Neville Chamberlin O’Bama.”

F “Not going to throw in Hussein for good measure.”

G “That’s silly. His first name was Arthur. He gets a C-.”

F “Arthur?”

G “Neville C. O’Bama. After the tax sell-out, I called the White House and the delegation and told them that I have had it. I unsubscribed from seven political e-mail lists. My contributions are too miniscule to matter, yet I told them that I am not making any more contributions. No bumper stickers, no canvassing, no money, no more.”

F “No one subscribes to my political views, so I can’t even unsubscribe from e-mail lists. We confronted a Hobson’s choice in 2008. O’Bama was and is a centrist. He’s the better we could do.”

G “He hasn’t challenged the massive continuing transfer of wealth to a small elite who do not contribute to the economy. It is almost as if he got into office and discovered that there are certain unwritten overriding rules that cannot be undermined or even challenged by anyone in the office. The cabal of trolls in the basement of the White House call the shots.”

F “He hasn’t. And you may be right. The economic fundamentals are worse than they were in September, 2008. The poison is still flowing in the financial system. The banksters know that they will be bailed out by both the Republicans and the Democrats and will never need to make bail for their crimes. The recent bailouts have been detailed and delegated to the Fed.”

G “When is someone going to realize that the aggregation of wealth in the hands of a very small group is actually an impediment to economic growth?”

F “When the Nobel Prize Committee signals that it will give a Nobel in Economics for the conclusion.”

G “The expenditures employ yacht builders and polo saddle makers, but not ordinary unemployed butchers, bakers and brick makers.”

F “Yacht builders and polo saddle makers need jobs. Politics is about compromise. Compromise is not pretty.”

G “Compromise is different than capitulation. He has capitulated. Someone said that the country may need a war to pull us out of the economic depression. He and we have two of them going that have not done much positive.”

F “Is the third war a charm.”

G “Just watch. America can be broken.”

. . .

[President Dwight D. Eisenhower delivered his “Military-Industrial Complex” farewell speech/warning 50 years ago about the “unwarranted influence, whether sought or unsought, by the military industrial complex.”]

[MLK Day]

Bumper sticker of the week:

Hope (I hope, hopefully)

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