Prosperidad y Paz y Prosperidad
Invest or Invade? (December 15, 2008)
Posted in China, Foreign Policy, Russia on December 15, 2008 by e-commentary.orgWorld War II involved a skirmish between and among the world’s Type A personalities (USA, Britain, France, Russia, Germany, Japan). One of the central messages of that War is that it is much easier to take by investment than by invasion. The Germans and the Japanese learned that lesson well. The Chinese seem to be embracing the “invasion by investment” strategy and may find the need to invade the USA mooted if they can acquire this country in the open market or in Bankruptcy Court.
The Russians have come full circle and won a few battles in the continuing Cold War because their natural gas heats European homes. Russia has successfully invaded Europe by investment. Pipelines are mightier that troop lines. Russia owns part of Europe. The Russians, however, are reverting to the old paradigm. They want to invade. They may want to invade because the US has been quietly antagonizing Russia. Bush/Cheney/Rumsfeld broke the military that may not be able to respond. American is sliding into “second world super power” status. Problems are on the horizon.
Bumper sticker of the week:
Invasion by investment
Bankrupt Auto Companies? (December 8, 2008)
Posted in Automobile Bailout, Automobiles/Automobile Industry, Bailout/Bribe, Bankruptcy on December 8, 2008 by e-commentary.orgCongress recently rejected the request by the “Big 3” (GM, Chrysler and Ford) auto companies who came in with their palms out and instead asked them to go out and come back with a plan in hand. Congress already passed a Plan. The Plan is part of Chapter 11 of Title 11, the reorganization chapter of the Bankruptcy Code. The Code, in particular Section 365, provides the debtor with the power to avoid contracts and leases when necessary. This provision is discussed in previous “e-ssays.”
Roam an auto show. Kick the tires. Open the doors. Sit on the seats. Turn the buttons. Toggle the switches. Slam the doors. Look under the hood. Peek in the trunk. Check the workmanship. Read the specs. Scrutinize the consumer reviews. Check recall notices. Repeat.
Georgetown, Princeton and Cambridge make better cars. In Kentucky, Indiana and Ontario (Canada), three of the Toyota plants in North America. The management in Detroit has designed and manufactured lousy and energy-inefficient vehicles for decades and made Detroit irrelevant. The trio from Detroit did not propose real compensation concessions to match the pay packages of their far more successful counterparts in Tokyo and Munich and elsewhere.
Southern Republican senators smell an opportunity to bust a union, the United Autoworkers of America (UAW), and support the non-union plants in their states. However, the employees in the non-union states only receive the wages they receive because they can point to the higher wages possible if they were to unionize like their brethren in the North. Cripple the UAW and undermine wages. The Civil War, the War Between the States, the War between the Red States and the Blue States, the War between the North and the South continues unabated.
The Bankruptcy Code still provides the most promising legal mechanism to reorganize (organize?) the automobile companies. The logic of Chapter 11 is that a going concern has additional value that should be preserved. The problem seems to be that Chapter 11 may be inadequate under the circumstances. The amount of the proposed bailout is squandered by the U.S. in a few days in Iraq.
The Trillion Dollar Bailout/Bribe of Wall Street was and is a travesty. Is a bailout of the Big 3 necessary or appropriate?
Bumper sticker of the week:
See the USA owning Chevrolet?
Printing Electrons? (December 1, 2008)
Posted in Economics, Federal Reserve, Inflation on December 1, 2008 by e-commentary.orgThe Federal Reserve is running the “printing presses” 24/7. The Fed. issues regular press releases announcing:
Federal Reserve will offer $150 billion in 28-day credit through Term Auction facility [yesterday].
Federal Reserve announces results of auction of $150 billion in 28-day credit held on [yesterday].
Federal Reserve will offer $150 billion in 28-day credit through Term Auction facility today.
Federal Reserve announces results of auction of $150 billion in 28-day credit held today.
Federal Reserve will offer $150 billion in 28-day credit through Term Auction facility [tomorrow].
Federal Reserve announces results of auction of $150 billion in 28-day credit held on [tomorrow].
. . . . . . . . . .
The amount raised and the term may vary, yet the country is burrowing in deeper at a faster rate.
Bumper stickers of the week:
The Trillion is the new Billion.
“A billion [Trillion] here, a billion [Trillion] there, and pretty soon you’re talking real money.” Attributed (perhaps incorrectly) to Everett Dirksen
Deflation? (November 24, 2008)
Posted in Depression, Economics, Gas/Fossil Fuel, Inflation on November 24, 2008 by e-commentary.orgDeflation seems to be the current concern. Oil, copper and aluminium prices are down dramatically. When the raw materials go down in price, the finished products should go down in price. In theory, sort of. The price of a 250 foot section of Romex wire is now almost what a 100 foot section cost a year ago. However, prices often are sticky and ratchet down slowly. Lower prices sound appealing, although deflation does create economic problems among debtors and consumers.
However, the old economic models may not work. Demand is down because no one has any real money and no one will loan any real or unreal money. However, credible reports indicate that people need to eat, house, drive, acquire plasma tvs, etc. The system is awash in unreal money. However, those who produce goods and provide services are not standing by ready to respond. They are collapsing. The world‘s economies and the world Economy are splintered and increasingly disconnected. If you build it, they may not come.
Gas did not hit $6 a gallon by Halloween; it hit $3 a gallon. [See the e-ssay dated May 26, 2008 entitled “$4 in June, $5 in July, ….”.] The momentum for fuel-efficient vehicles has abated and investment in oil-producing equipment and fields has declined. When the demand for aluminium declines, bauxite is not mined. In the near future, everyone will compete with pockets full of unreal dollars for scarce goods and services. Bread at $100 a loaf? Inflation still seems to be the hidden monster. The new Weimer Republic writ large.
Bumper sticker of the week:
WIL
Whip Inflation Later
The Virtual Horserace (November 17, 2008)
Posted in Economics, Greenspan, Housing on November 17, 2008 by e-commentary.orgDuring the dot.com bubble, a small number of affluent investors (consultants, dentists, consultants to consultants, public employee retirement funds, consultants to consultants to consultants, candle stick makers, etc.) anteed up large bets in cash up front; few horses crossed the finish line a few years later; everyone absorbed the losses with little intermediate-term damage. Okay, they will retire later and perhaps with less money. Life went on. [See the e-ssay dated December 4, 2006 entitled “When the Bubbles Burst”]
During the “Greenspan Bubble,” however, the seeds of the Depression were sown democratically across the land. (Almost) everyone in the populace placed huge bets on credit; few horses will ever complete even the first stretch of a 30-year race (mortgage term); the negative consequences are predictable and devastating. The intermediate-term loses may be 3 to 5 to 7 Trillion in the US and a few Trillion overseas.
Astute observers knew that something evil was going on behind the scenes during “Hurricane Al,” but the contours of the corruption did not emerge until recently. The Wall Street Boys devised something noxious known as a “Credit Default Swap” that involves a “virtual horserace” without real money that jeopardizes the economy and the American economic and political system. The real nightmares are the bets placed on bets placed on bets placed on bets placed on bets placed on bets placed on bets in this virtual and unregulated gambling casino using CDSs as tokens. These players were betting on outcomes in the horse race and then insuring the outcomes without any money, margin or reserve. The winners (who may need to lose in order to win) of the game want to be paid; the losers cannot pay and never intended to pay.
No one will say that these gamers are “domestic economic terrorists.” Saying something that true and stark is deemed to be impolite and impolitic. The CDSs are a cancer on the country. The losses may be 25 to 50 Trillion or more. The Economy cannot absorb the losses.
Bumper stickers of the week:
We will get fooled again.
“All you need in this life is a tremendous sex drive and a great ego. Brains don’t mean a shit.”
Mayor Anthony “Captain Tony” Tarracino (1916 – 2008)
U.S.A. – 1 (Won); World – 1 (Won) (November 10, 2008)
Posted in Elections, O'Bama on November 10, 2008 by e-commentary.orgWe have met our friend and he is us. Pogo.
McCain very likely would be President-elect of the United States of America today if the first wave of the Bush Depression had not crashed ashore in mid-September. September 15 may be the high water (or low water) mark when McCain proclaimed: “The fundamentals of our economy are strong.” Americans were not fooled. They were afraid, very afraid. It was the stupid economy.
Obama’s guerdon and lagniappe — the privilege to deal with the Great Tsunami, the “Bush/Greenspan/Gramm Depression,” and World War III now festering in at least two theaters on a planet in ill health.
Reverend Wright incited the Right and left others feeling that something was not right; seems that everyone on the national stage sports a Rev. John Hagee in their entourage. Some white Republicans could accept an African-Thai-American named Tiger but were not ready to accept an African-Saxon as the Lion. However, others conquered their fears and anxieties and played through them. Many Americans had gotten a preview by watching two different African-Americans play the President OTUS on the television show “24.” In this episode, Alexander “Scotty” Scott goes to the White House. Illinois finally sends Adlai Stevenson to the Casa Blanca.
Obama may be the Transformative Candidate or the Transitional Candidate, yet he is clearly the Technological Candidate. The toxic a.m. radio shows and the venomous robo-calls from the Franchise Republicans marketing fear were matched and exceeded by a relentless stream of e-mails from Team Obama offering hope, promising change and soliciting funds. Intimidation for your ears; inspiration for your eyes. The Internet won handily.
Money talks; McCain walks. McCain-Feingold has been replaced by Obama-Plouffe. The billion dollar Presidential race in 2012.
Washington presided when the country was forming; Lincoln when the country was dissolving; Roosevelt when the country was segregated and disintegrating economically. The man from Hope brought some semblance of prosperity and peace and now the man promising hope confronts the Bush Depression and World War III. Obama will preside in one of the dozen most uncertain periods in American history. He appears to be up to the challenge. One can only hope.
A profound development. The first African-Irish-American in the White House. Barack Hussein “Steve” O’Bama.
Bumper stickers of the week:
Hope and Money and Fear
Esperanza
Si, se puede
Yes he/we can (maybe)
Do It (November 3, 2008)
Posted in Elections on November 3, 2008 by e-commentary.orgIt’s the thing to do on the first Tuesday in November. Vote. Hope over Fear.
Bumper sticker of the week:
THE 545 PEOPLE RESPONSIBLE FOR ALL OF AMERICA’S WOES
BY CHARLEY REESE
Politicians are the only people in the world who create problems and then campaign against them.
Have you ever wondered why, if both the Democrats and the Republicans are against deficits, we have deficits? Have you ever wondered why, if all the politicians are against inflation and high taxes, we have inflation and high taxes?
You and I don’t propose a federal budget. The president does. You and I don’t have the Constitutional authority to vote on appropriations. The House of Representatives does. You and I don’t write the tax code. Congress does. You and I don’t set fiscal policy. Congress does. You and I don’t control monetary policy. The Federal Reserve Bank does.
One hundred senators, 435 congressmen, one president and nine Supreme Court justices – 545 human beings out of the 235 million – are directly, legally, morally and individually responsible for the domestic problems that plague this country.
I excluded the members of the Federal Reserve Board because that problem was created by the Congress. In 1913, Congress delegated its Constitutional duty to provide a sound currency to a federally chartered but private central bank.
I excluded all but the special interests and lobbyists for a sound reason. They have no legal authority. They have no ability to coerce a senator, a congressman or a president to do one cotton-picking thing. I don’t care if they offer a politician $1 million dollars in cash. The politician has the power to accept or reject it.
No matter what the lobbyist promises, it is the legislator’s responsibility to determine how he votes.
A CONFIDENCE CONSPIRACY
Don’t you see how the con game that is played on the people by the politicians? Those 545 human beings spend much of their energy convincing you that what they did is not their fault. They cooperate in this common con regardless of party.
What separates a politician from a normal human being is an excessive amount of gall. No normal human being would have the gall of Tip O’Neill, who stood up and criticized Ronald Reagan for creating deficits.
The president can only propose a budget. He cannot force the Congress to accept it. The Constitution, which is the supreme law of the land, gives sole responsibility to the House of Representatives for originating appropriations and taxes.
O’Neill is the speaker of the House. He is the leader of the majority party. He and his fellow Democrats, not the president, can approve any budget they want. If the president vetoes it, they can pass it over his veto.
REPLACE SCOUNDRELS
It seems inconceivable to me that a nation of 235 million cannot replace 545 people who stand convicted — by present facts — of incompetence and irresponsibility.
I can’t think of a single domestic problem, from an unfair tax code to defense overruns that is not traceable directly to those 545 people.
When you fully grasp the plain truth that 545 people exercise power of the federal government, then it must follow that what exists is what they want to exist.
If the tax code is unfair, it’s because they want it unfair. If the budget is in the red, it’s because they want it in the red. If the Marines are in Lebanon, it’s because they want them in Lebanon.
There are no insoluble government problems. Do not let these 545 people shift the blame to bureaucrats, whom they hire and whose jobs they can abolish; to lobbyists, whose gifts and advice they can reject; to regulators, to whom they give the power to regulate and from whom they can take it.
Above all, do not let them con you into the belief that there exist disembodied mystical forces like “the economy,” “inflation” or “politics” that prevent them from doing what they take an oath to do.
Those 545 people and they alone are responsible. They and they alone have the power. They and they alone should be held accountable by the people who are their bosses – provided they have the gumption to manage their own employees.
[This article was taken from the Orlando Sentinel Star newspaper.]
The Republican Message In The West (And South) (October 27, 2008)
Posted in Gay Politics, Guns, Political Parties on October 27, 2008 by e-commentary.orgThe Republican’s Western strategy is built on the motto: “Guns, Gays and God.” The message is simple: vote for us or you will be castrated, raped, and abandoned alone in the world.
The Democrats met in Denver to take back the West. They may not understand the elemental fears and anxieties of many members of the populace. The Democrats offer vision and hope. That is virtuous; that alone is not productive in the polling booth. The Republicans offer fear and loathing and anxiety. The Gun is the iron penis; take it away and you castrate a man. Gays, the logic goes, and their cohorts the Democrats want to rape you. You may come into the world alone and leave the world alone, but you are not alone if you subscribe to God while you are here. The code words this year are “Socialist,” “Terrorist,” “Muslim,” “Arab” and “Hussein.”
The “Blue States” subsidize the “Red States” in America. The populations in the Red States rely primarily on social security for their retirement. The populations in the Red States resort to the Bankruptcy Code for relief more often than the populations in other states. The populations in the Red States use the Bankruptcy Code as a form of socialized medicine. At core, however, the differences are related to education, region and religion rather than state boundaries, yet the electoral college focuses the analysis on state boundaries.
The populace may vote its pocketbook, but only if its elemental fears and anxieties are not summoned. Enough members of their populace are so terrified that they do not even have enough personal security to vote their pocketbooks.
A random survey of yard signs in a purple neighborhood: Obama. McCain, Obama, McCain, Obama. McCain, Obama, McCain, Obama. McCain, Obama, McCain, Obama. McCain, Obama, McCain, . . . Obama
Bumper stickers of the week:
Fear and loathing on the campaign trail ’08
Hope over Fear?
Contemporary American Political Parties 101 (October 20, 2008)
Posted in Political Parties, Politics on October 20, 2008 by e-commentary.orgA “brand” is a story. Promoters of products seek to “brand” them and concoct a story to attract the target customers/clients/viewers/fans/constituents/voters. Some political commentators suggest that the two political parties tend to gravitate to the center to attract the widest swath of voters. In America, however, the two political parties offer fundamentally different visions of the present and future that have remained consistent over the last few decades. The two “brands” cannot be distinguished by analyzing their political platforms on jay walking or school uniforms or the like; the analysis must be more elemental.
At core, the “Republican Franchise” proclaims that “Government is big and does not work” and then sets out both to expand government and to make government not work while rewarding their friends with federal largesse. The Republican Franchise has fooled enough of the populace for decades into believing that the Party is against spending and taxes and that deficits do not matter. Deficits are taxes; on the unborn.
Democrats are war veterans (McGovern; Gore; Kerry; Cleland; Webb); Republicans are draft dodgers (Bush; Cheney; Giuliani; Ashcroft). Democrats don’t like going to war unless necessary; Republicans don’t like going to war themselves but like to send others to war.
At core, the Republicans market fear; the Democrats offer hope.
True Tenets/Characteristics of contemporary Franchise Republicanism:
- Threaten fear over hope and market anxiety to anesthetize and dispirit the public while hinting that those who vote with the “Republican Franchise” can delude themselves into believing that they are part of the Beautiful People for a few moments on election day;
- Support free trade for their friends most of the time;
- Oppose almost everything else;
- Promote big government and massive federal expenditures–large armies and weapons systems and massive prison complexes (to kill others and to enslave the population);
- Engage in reckless spending and spending and spending and spending and spending;
- Spend Other People’s Money (OPM) to benefit themselves;
- Pursue unnecessary wars to maintain and expand the American Empire;
- Sport shallow “White Bling-Bling” such as jewelry with the American flag on their lapels but refuse to allow others to display their own flags and symbols in their own way;
- Circle the wagons to protect the Republican Franchise even if that means allowing an ideological infidel into the inner circle;
- Win.
True Tenets/Characteristics of contemporary Democrats:
- Offer hope over fear and inspire the public even if the public instinctively responds to fear and encourage a “big tent” but often pitch it awkwardly;
- Support some protectionist trade policies;
- Favor a wide variety of policies and proposals that are frequently inconsistent, anomalous, antinomic and occasionally fuzzy headed;
- Promote efficient government even though every institution—public and private—involves much inevitable waste, fraud, and mismanagement;
- Engage in pay-as-you-go legislation and yet privately desire to spend even more money;
- Spend Other People’s Money (OPM) to benefit others;
- Debate the use of force and use it when necessary to promote the nation’s security and well being;
- Prefer substance over fluff and allow others to display their own flags and symbols in their own way;
- Burn the wagons or drive them into the ditch if someone disagrees with them on any proposition thereby snatching defeat from the jaws of victory at every opportunity;
- Lose.
In the end, however, fear almost always trumps and triumphs over hope. Thus, the outcome in elections in the last 30 years is not surprising. The Republicans have circled the wagons; the Democrats have also circled their wagons after some missteps. Could 2008 be different?
Bumper sticker of the week:
Wag more
Bark less
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