The Palin Pick

Hot-Diggity-Dog! I didn't think the old man had it in him. This pick makes sense for several reasons. The main reason I like it is it brings the Reagan coalition back off the mat. Palin represents all three major groups, values voters, defense hawks, and even us limited government types. The big-government-neocons are headed for the exits, and small government conservatives have somebody besides Ron Paul to rally around. The GOP may be down, but we're not out.

She lives what she preaches on abortion, having given birth to a child she knew would have Downs Syndrome. Her oldest son, is on his way to Iraq. The famous "Bridge to Nowhere" went nowhere because Palin cut off state funding. She's not just from small town America, she still lives there. There are plenty of reasons to like this pick. It will be interesting to see what lame excuses the ladies at NOW come up with to not endorse her.

Can she give a good speech? Can she whip up a crowd? Can she debate? Don't know. Never heard her voice. But, a lot of Republicans who were soft on McCain are feeling pretty good tonight.

The Long Road

There is no denying that last night was an historic moment in our history. Much has been, and will be made of the Democratic party's role in the modern civil rights movement. There is a much longer story. Until we all come clean, talk of progress is just retoric. Jeffery Lord, writing in the Wall Street Journal outlines the "missing history". Read it here if you can stand it.

The Big Picture

When Ulysses S Grant was appointed Commander of Union Forces and took up residence with the Army of the Potomac, he gathered his generals to discuss the situation. He asked them one by one, what is your assessment of the current situation and where do we go from here? One by one they answered, Bobby Lee this and Bobby Lee that, and ain't Bobby Lee just the best dang general in the whole wide world. When they were finished, Grant told them to stop thinking about what Bobby Lee was doing to them and start thinking about what they were going to do to Bobby Lee.

Looking at the Democratic Convention as an outsider (on mom's borrowed TV) one thing is becoming clear; the Democrats are building the most powerful of all political weapons, a positive message. There was very little Bush-bashing in Queen Hillary's speech last night. A few shots here and there, but that's to be expected in any Democratic speech. What really came through was the 'what we are for' parts. Tonight, if Bill can manage to talk about something besides himself, and Biden can attack without showing his fangs, it will set up what could truly be an historic moment on Thursday night. If not, Obama's speech could be just another over-hyped media event.

Vice Presidents don't win elections, but McCain's VP pick is going to be crucial if he is to overcome anything truly historic happening Thursday. Romney or Pawlenty just won't do. He'll need to match history for history. In the era of identity politics, that means no more grumpy old white guys. Given the lack of minorities in the Republican party, it will almost certainly be a woman. Senator Hutchison? Senator Dole? Governor Palin? I can't venture a guess, but it better be big.

Comment Controversy

I first started reading blogs years ago. One of the first and best blogs I've found is Vox Day. He's a columnist for World Net Daily who bills himself as a Christian Libertarian. Agree or disagree, he's a pretty sharp guy and has a perspective you won't find anywhere else.Today's post is about comment boxes.

For myself, I like comment boxes. I've found the comments section of several blogs to be more interesting and entertaining than the posts themselves. I find it a bit pretentious that some blog authors want only "serious" discussions in their comment section. The internet is for everybody. Intellectuals, trolls and all those in between. Freedom of speech not only accepts the comments of idiots, it requires them. How would anyone know the difference between good and bad ideas if only one set of ideas are heard?

Communication is more than just sending a message. A message is only a sender and a receiver. Communication requires the receiver to respond, either in the comment box, or leaving comments on the senders blog. Finding like minded people as well as people to have disagreements with is the whole point of blogging. Identifying idiots is just an added bonus.

The Biden Pick (Part 1)

OK, I guess I've held off long enough. Here's why Joe Biden has already cost Obama the election. The assault weapons ban, waiting periods, trigger locks, every anti-second amendment vote possible, the anti gun nuts in the Democratic party could count on Sen. Biden. The sound you heard yesterday was every swing state west of the Mississippi and south of the Mason-Dixon line tilting towards McCain. Together with Obama's crack, about Pennsylvanians and their God and guns from the primaries, we can expect the Republicans to go into full mobilization mode on this issue.

Team McCain may not have a lot of money, but the NRA does. A lot of grass roots groups do. Two northern liberals are a recipe for scare tactics and the Republican attack machine is going to roll all over this one.

The Toilet Wars

I'm not one to live and die with what the NY Times reports, but I happened across this article this morning. Among other things, they report:

"The Russians have also left the Georgian military base in Senaki, but only after confiscating almost everything of value, including televisions, refrigerators and even toilets, according to local residents who have watched the steady stream of Russian trucks moving in and out of the base for more than a week."

What does it say about the quality of life when people are stealing toilets? Is there a single human being in any western country who can relate to this? In spite of all the reforms put in place since the fall of communism, it would appear the underground economy in Russia is still in good health. Shipping toilets to Russia seems a better alternative than shipping guns to Georgia. Just a thought.

It's Worse Than You Think

As Mark Twain once famously said "There are lies, damn lies, and statistics." John Williams, an independent economist is the creator of shadowstats.com. There's no big conspiracy theory here, just changing times, changing people, and changing accounting methods. With a natural curiosity about official government numbers, he poses the question; "What would the official government numbers look like if the accounting methods stayed the same?" It ain't pretty.


M1 is the physical currency plus checking accounts; the amount of money in circulation. M3 is the entire supply of money within an economy, including money created through credit; servicing the national debt, money created by banks to finance home loans etc.

One rule of accounting is: When the news starts looking bad, stop counting. In 2004 the credit bubble begins with a mounting national debt, easy credit from falling interest rates, home equity borrowing and a general shift to a cashless society. In 2006 the Federal Reserve claimed that the cost of gathering M3 data was more than the data was worth. Congress and the president agreed and the law was changed. By early 2008 the bubble bursts as the big banks write off billions in overvalued equities and smaller banks go out of business. This is followed by a rise in M1 as "Cash is king" becomes the order of the day, and the long road back to near parity begins.


Did the Reagan Revolution create economic growth? You bet it did, any way you measure it. So much growth so fast that it scared the bankers out of their wits. The decline starting in 1984 is the effect of the Federal Reserve raising interest rates to "cool down" the economy. Who needs a bank loan when you're making money hand over fist? The years 1989 to 1993 show the Bush 41 years. Not the worst economy ever, but not good either. 1993 to 2001; the peace dividend, the dot-com bubble and the much overdone "Clinton Miracle" combine to produce a sluggish 1.5% growth rate. 2000 to present: The dot-com bubble bursts, the 9/11 attack, and we've been in negative growth ever since.


Did the Reagan Revolution beat inflation? Skunked it. In 1983 the methods for measuring inflation were changed. I remember the immediate 1/2% drop caused quite a controversy. Eventually the law was passed and for years afterward, there really wasn't much difference. By 1992 the 1/2 point difference had grown to 2% and marks the beginning of an ever widening gap between the two methods. If you wonder why your paycheck doesn't seem to go as far as it did, and everything seems so outrageously expensive, while the government keeps telling you that inflation is under control, a 13% inflation rate could be why.

US Mint revisited

In 1986 the government decided to produce bullion coins for sale to the public as a way to pay for mint operations. Starting with silver and gold, and later adding platinum coins, it's been a good money maker for them. I bought a few silver eagles in the late 80's, but soon lost interest and haven't paid attention since. So, it came as a bit of a shock when Mojo alerted us to the fact that the US Mint was halting production of gold coins. With the recent run-up in spot prices, was there a run on gold coins? Was some evil-doer trying to corner the market? None of the above.

The way it works is, the mint sells coins exclusively to coin dealers at a static price based on their cost and whatever is deemed a reasonable profit. The coin dealer resells these same coins based on the spot price plus a $25 premium to the public. As long as the spot price rises, everybody wins. When the spot price falls below the production cost at the mint, the mint stops production. If it falls below the dealer cost, he/she pulls the coins of the shelves. The only loser is, as always, the consumer. The last guy in line gets left holding the bag.



This chart shows a classic double top formation, well known to "chartists". The time to sell is just after the second peak. As the price falls, more sellers arrive and when the price falls below the previous bottom it's "everybody out of the pool" time. Eventually, the buyers outnumber the sellers, and a new bottom is formed. My guess is, the mint stopped prodution in early July, sold off their inventory, and are only now announcing their production halt.

The Cost of Moralizing

Thomas Sowell, always a good source on economic topics, writes today on the Russia/Georgia conflict. Unlike most commentators, he bypasses the Serbia/Kosovo analogy and looks at the Soviet invasion of Hungary in 1956. A unique perspective on recent news and food for thought about our history of tough talk and no action can be found here.

The entangling alliance of an ever expanding NATO is a disaster waiting to happen. Does anyone seriously believe that Europe will do anything but cheer leading in the next war? The truth is, Russia makes a better partner than all of Europe combined. We need them, and they need us. Who needs Georgia? Where does NATO end and the rest of the world begin?

The Best Idea Yet

Buried in the middle of George Will's latest column regarding John McCain's inadequacies, was the following gem;

"No officer of any corporation receiving a federal subsidy, broadly defined, can be paid more than the highest federal civil servant ($124,010 for a GS-15)."

I've heard of salary caps before, but I'd never heard of tying subsidised corporate salaries to civil servant salaries. This is an idea that Mr. Will says John McCain has "expressed sympathy" for, although I've found no specific quote.

Something like this would put a huge roadblock in the path of the government gravy train. Of coarse, they'll find ways around it, over time, but this seems like a good place to start a fight against the general level of corruption in Washington. The key is keeping it to corporations receiving subsidies. Let the corporations and small businesses make as much as they can. This point will be especially important in the upcoming environmental battles sure to begin next spring, regardless of who wins what in November.

With both sides talking about a move away from our oil based economy and into renewable energy, the forces of the status qua are already planning their next assault on the taxpayers. The public/private partnerships often touted by Democratic candidates and big government conservatives (oxymoron) open the door to all manner of corruption. Keeping the multi-national corporations, and other masters of K Street, out of the equation while allowing the independent inventors and small cap corporations to team-up is the key to doing things right.

The big problem with all this is how to get it past the current set of players. If both presidential candidates were to make something like this a major part of their campaigns, then it could serve as a mandate. Barring that, perhaps we here in Nevada could pass some state laws to this effect, as we will no doubt play a role in any solar power or wind power deals.

Supply and Demand

I've been working on an economic table for the sidebar, and stumbled upon a pretty good example of the law of supply and demand in action, courtesy of Kitco.com. Unlike gold and other precious metals, the copper market is nearly devoid of day traders and speculators. At just over $3/lb, it's not the best place to make a quick buck. As a result of the "crooks" having better targets of opportunity, the copper market has remained relatively free and unregulated.



The first chart shows a falling price over the last 30 days, a result of the economic slow-down. Note the upswings in the general downward trend. This is caused by the warehouses finding temporary alternative suppliers. Every bear market has rallies.




The second chart shows 30 day inventories on the London Mercantile Exchange (LME). The warehouses are buying on the way down. Each time they buy they reduce their break-even point. Compare the flat spots to the price rises. They lag slightly behind. As the producers (miners) slow production, the supplies decrease, thereby increasing the demand among the warehouses (exporters).



The third chart shows a natural business cycle, the way God and Adam Smith intended it. Eventually, the price (demand) hits bottom as the inventories (supply) tops out.

A chart like this allows a small investor (like me) to plan ahead and buy low/sell high. It's very difficult to find a chart like this, given government meddling in the economy and a toothless SEC that allows the crooks to run rampant. But, once in a while one can still spot good old fashioned main street capitalism in it's natural habitat. Sort of like Bigfoot sightings.

Russia/Georgia and the Press

It's interesting how the press has been covering the Russia/Georgia conflict. I mostly just read the right wing stuff, and when it started, most of the commentary was sympathetic to Russia. It was generally agreed that Georgia had started it and had over-played their hand. They wanted a fight and they got one. Several commentators argued that the Russians were just doing what we had done with Serbia/Kosovo back in the 90's. After all, the Ossetians were a small group of people desirous of independence who were standing up to an aggressive neighbor. The Russians were coming to their aid for the principle of self-determination.

All that has now changed. The so-called "conservative" press is now calling the Russian action "meddling" in Georgian affairs. There is no talk of US meddling for the sake of NATO expansion, which has been a disaster for US/Russian relations. There is little question here that we are the expansionist power. NATO should have been disbanded long ago.

During the Serbian conflict, the US carried out 90% of the bombing, with England 9%, and everybody else just 1%. Now, with England backing away from our "special relationship" it's pretty clear to me that we'll be going it alone. To risk antagonizing the Russians, or even risk a shooting war with Russia for the sake of the "alliance" is insane. The fact that Georgia is a democracy is beside the point. Just about everybody claims to be a democracy these days. The government in the Gaza Strip can claim to be a democracy. So what?

The government of Georgia should fall, and Putin is just the guy to do it.

New Google Gadgets

I've been wanting to add some economic charts to the sidebar since I started this site. There's not much one can use, at least not legally. This week, Google/Blogger announced they are offering a huge amount of new gadgets, so I've been looking them over. They list 370 new gadgets in the finance section alone. Upon further review, about half of them aren't working or are under construction. Several are in foreign languages and there are about 15 or so that get repeated fairly often. I'd say there are about 50 new usable gadgets.

I thought at first I had finally found what I was looking for. On second thought, I have much better sources than google for these things, and the idea occurred to me that I should just build my own. I'm somewhat contrarian so I don't look at the same numbers as the rest of the herd. I know just enough HTML to be dangerous, and what's a blog for if not to try out a few experimental ideas? The more I think about it, the better I like it. So, I'll spend my weekend building an economic section to the sidebar. On a scale of 1 to 10, how geeky is that?

Election Day/Night/Day

I arrived at the polls at 7 AM sharp to vote in the Nevada primary, on election day, the way God and the Founding Fathers intended it. The line was already out the door, but moved quickly. Total time voting was 14 minutes.

The new voting map at the county registrars office is extremely cool. You'll have to wait for the map to load, and it only covers turnout- not who's winning but still, very nice. I woke up this morning and found it had crashed. It's back up and running now though.

The results of the primary were pretty disappointing. My precinct only had a 2% turnout, better than the 1&1/2 of 2 years ago, but I need to get with it. My 2 upset picks were both defeated. Don Chairez lost out in the race for the supreme court by only 300 votes state-wide. I hope he takes heart from the narrow loss and comes back in 2 years. The other candidate I liked was the omnipresent James Smack. He came in just below 15%. I was figuring 30. Of coarse he was the longest of long shots, but I thought he would do better. Interestingly, he posted pretty consistent numbers across the counties.

For the most part, the party establishment retained their grip on power. I think the lesson I'm getting from all this is that next time, I'll get involved with a candidate rather than the party as a whole. Of coarse, one has to be involved with the party just to find out who the candidates are. Republicans aren't known for being web-savvy. There must be some way that works better for me and still helps get at least one good guy elected.

The Lion of 4th Street

With the dearth of conservative blogs in northern Nevada, and the general lack of interest in the inter-net among Republicans, I've had to content myself with reading the competition. The most creative and labor intensive site I've found so far is Zeke says so.

Humor is Zeke's weapon of choice (always a good thing). He seems to post at least once a day (no easy task). Call it creative destruction. Even though he is well to the left of anything I believe, and 4th street isn't a place I would go, even in daylight, he still gets a laugh and is worth reading. And so, against my better judgement, I'm adding Zeke to the "Sites of Interest" aka Hall of Fame.

Google to the Rescue

An interesting side light to the Russian/Georgian conflict is this. The Georgian government is switching their web sites to Google blogger in a computer hacking war with the Russians. Estonians, who have some experience with Russian cyber-attacks, are being rushed to the scene. There has also been disruptions of Russian government sites reported.

Muths 1/2 Truths

I'm having serious doughts about Chuck Muth and his so-called Truths. I first caught-on to Muths Truths after the Washoe County Republican Convention. He is only one of a handful of conservative bloggers in the Reno area. He seemed, at first, to be a good source for statistics and general news about other conservatives around here. I've since concluded that his numbers are not dependable. His obsession with personal disputes, along with who hasn't signed his no tax pledge, seems to over-ride all other considerations. A couple of recent hit pieces serve as examples.

Former Secretary of State and candidate for Assembly District 40 Cheryl Lau, who has not signed the pledge, recently stated that she might be in favor of a weight and distance tax on trucks. Now I'm as libertarian as a republican can be, but this sounds pretty reasonable. The maintenance of public by-ways is a legitimate power of the state. The use of those by-ways should rightfully be paid by the people who use them. If anyone doesn't like paying for the use of our roads, on their way to somewhere else, they're free to go around.

This idea of no new taxes in order to limit government was a nice theory back in the good old Reagan era, but the last 25 years has proven it wrong. Limiting the income of the government does nothing to control spending. Politicians, when faced with a shortfall, will almost always borrow more money rather than cut a program. No new taxes simply means lots of new debt.

I'd just like to point out that roads are made of asphalt. Asphalt is made from oil. When the price of a barrel of oil goes from $25 to $140, what does that do to the cost of paving a road? (Cue Jeopardy theme song). Also, the 2 people commenting on the Lau hit were both Democrats who were in favor of the no tax pledge. They like it because it constrains Republicans while Democrats run free with their spending plans.

The other hit piece was on Mike Webber. The cover story is that Mike seems to have an ego. Someone in politics has an ego? Say it ain't so! And this, coming from a guy who has his own blog on his blogroll. I guess if Mr. Muth's readers forget where they are, they can find themselves again.

The real reason for the hit, of coarse, is the fact that Mike Webber is leading the fight against the delegate selection committee. There is ample evidence of Mr. Muths disdain for Ron Paul supporters throughout his blog. Even though Mr. Webber has repeatedly said he is not a Ron Paul supporter, he often is painted as one. This is simply guilt by association. Mr. Webber's interest is in keeping as many factions in the party as possible, and insuring that their voices get a fair hearing, unlike Mr. Muth and his pretend girlfriend, Sue Lowden.

The bottom line here is that I'm still looking for a reliable source.

HQ Open House

I went to the open house at the new Washoe County GOP Headquarters tonight. Although I had been there before for the precinct captain training, I was drawn by a general curiosity, the feeling that Gwen would be there and want to discuss my project, and the promise of a free hot dog.

I have determined a fourth rule of political activism.

The most interesting thing about party get-together's is who doesn't show up.

When I got there, I didn't see a single recognizable face. I mingled through the crowd, looking for someone to say hi to, when I practically ran into none other than the omnipresent James Smack, candidate for congress. I have to hand it to the guy, he shows up at all of these things, even though he tends to stay within his group of supporters. I'm continually surprised by how little interest most candidates have for meeting new people. He seemed genuinely pleased at how his campaign was going. What an upset that would be, if he beat Heller. After a while I headed for the hot dog stand. Great hot dogs; perfectly burned to bachelor standards.

It was soon announced that the candidates were ready to give their speeches, so we all piled into the office. Gov. Gibbons aide, upon introducing the Governor, told us all what a great job he's doing and how we need to elect more Republicans. Then the Governor spoke about what a great job his aide was doing and how we need to elect more Republicans. Then the Lt. Governor got up and told us all about what a great job both the governor and his aide were doing and how we need to elect more Republicans. The big laugh of the night was delivered by Mr. Smack. He talked about the recent events in congress, when Speaker Pelosi banged the gavel, declared a recess, and shut off the electricity. Sound familiar?

The only other interesting thing that happened was that Heidi Smith gave a big send-up to Kris Pickering, candidate for Supreme Court Seat B. Ms. Pickering certainly has a lot going for her, but Don Chairez was there too, and he's running for the same seat. He's a soft spoken, reserved guy; a bit on the portly side like a judge should be. It's a tough choice, but I'm leaning to Chairez. There's something about good looking 40ish blond women in positions of power. I think there are too many of them.

Market Update 8/3/08

The boys over at marketedge.com finally got their upswing last week. And, just as they said, what would have been a mild up-tick turned into a spike, thanks to short sellers hedging their bets. Of coarse, the DJIA still finished down for the week, as did the S&P 500, while the NASDAQ was flat. They're calling this the start of the "summer rally". I call it "some, 'er...rally". Whatever it is, it's projected to last through mid-October.

Meanwhile, over at the S&P they seem to be aware of the fact that spikes in a down trend are a classic sign of a bear market. They also seem to be aware that oil prices, like the leaves on the trees, fall in autumn. They project the oil price to stabilize between $75-$100/barrel. They are also forecasting continued recession until a trough is reached in March of 2009. There is no forecast for the upside of the trough.

I am becoming increasingly disillusioned with all the cheer leading at marketedge, compared to the more sober analysis of the S&P economists. The computer models at marketedge, although more or less accurate, seem more tuned to the quick buck investor. The quick buck style, always a bit dangerous, can be disastrous in this kind of environment.

Local So-and-so's First Rule of Investing:

Never buy in to a falling market.

I have such a paltry sum invested at the moment, that it seems better to save what I can and await better days. I'm sitting out the some 'er rally.

Sue Lowden revisited

Just took a trip over to Sue Lowden's blog. And people wonder why the Republican party at the state level is so screwed up. What a pathetic lack of leadership she is showing. She writes a third person account in defence of herself and then closes the comment section. It's as if she has locked herself in the bathroom, opening the door long enough to throw the soap dish, before locking herself back in. Unbelievable. This is our leader? She praises the delegate selection committee for finally finishing their work three months late. Interestingly, we still don't know who is representing us at the national convention. I wonder if anyone from Washoe County is on the list? It looks like we will never know. Surely when she comes up for re-election, we could find someone who doesn't run away and pout every time somebody disagrees with her. She treats the Ron Paul supporters like they just left a stain on her living room carpet. Care to comment, Sue? The door's open here.