Twitter Theater presents...

Twitter at the Siege of Yorktown

Any similarity between the characters and persons living or dead is strictly coincidental. However, I would like to thank the 40 or so people I'm following on Twitter for their inspiration. Icons are from clipart.com, all rights reserved.

Cast of Characters……………....……..played by

MeFirst…………………........General Washington
YankeeYuppie……Aide to General Washington
Glutton4Gluttony…………...……Lord Cornwallis
DandyCandy…………...Aide to Lord Cornwallis
WillSail4Wine.………French Admiral De Grass
FuturePresident.…………..Alexander Hamilton
DocBentIt…………………......…Town Intellectual
PrivateAnon ……..Continental Army Private
InnkeepersDaughter……......……….…Anonymous
IDontStink………………......…High Society Lady
MatronlyMom……......……Working Class Woman

Note:Unlike a regular blog post, Twitter starts at the bottom and scrolls up. Our story starts at the bottom of the post and ends here.



DocBentIt FUNFACT: French people have 6 toes on each foot. #NewResearch




IDontStink My betrothed and I strolled along the wharves this afternoon. We met several gallant French Naval Officers. #2ndThoughts




MatronlyMom Fresh rat flanks ½ off @MidtownMarket




MeFirst @Glutton4Gluttony Very well, I’ll accept at noon this Inst'. #pwned




Glutton4Gluttony @MeFirst For the Love Of God man, I implore you, accept my sword. I’ve not had good veal in a fortnight.



PrivateAnon @MeFirst Begging the General's pardon, Sir, May I request you let them starve? I’d give a months wage to see @Glutton4Gluttony in a size 3 corset.



YankeeYuppie @MeFirst Could you hold off a little while longer General? I’ve got 2 bits on @DandyCandy not surviving.



Glutton4Gluttony @MeFirst It would appear you have the advantage, Sir. I’m prepared to offer my sword at your earliest convenience



DocBentIt FUNFACT: Surplus Continental Army bread doubles as a coarse cement. #NewResearch




DandyCandy @WillSail4Wine That’s DandyCandy you illiterate swine. I’m currently living in a mud puddle with commoners #disgusting.



WillSail4Wine @MeFirst I’ve dispatched the British fleet and am moving into range of the town. Where did you say @CandyAssDandy lived?


Two weeks later…



FuturePresident @PrivateAnon If I ever find out who you really are, I'll have you horsewhipped.




MeFirst @FuturePresident Very well, then. Proceed.




PrivateAnon @FuturePresident Good thinking Colonel, dying will definitely give us something to do.



FuturePresident @MeFirst @YankeeYuppie But the troops are idle. Attacking will raise morale and give them something to do.



PrivateAnon @FuturePresident Begging the Colonel’s pardon, how many is 10?




MatronlyMom My 7 yr old knocked over an entire hogshead of molasses in the barn and didn’t tell anyone. I’ll be scrubbing sticky cow hooves all morning now.



YankeeYuppie @FuturePresident Request denied. Fort number 10 has no strategic value whatsoever.



MatronlyMom My 13 yr old left a Bullfrog in the night pot for me last night. I didn’t get any sleep at all after that.



FuturePresident @MeFirst @YankeeYuppieI’ve found an opening in the line near fort number 10. Permission to attack?



DocBentIt FUNFACT: New poll out, women prefer men who bathe more than thrice a year to men who don’t. TinyBraodsheet83 #ClarkesvillePostDispatch


InnkeepersDaughter @WillSail4Wine I don’t presume you’ll be making port in Charleston to ‘re-provision’? ;)




WillSail4Wine @YankeeYuppie I’m off the coast of Carolina. This wind sucks.




YankeeYuppie @WillSail4Wine The General requests you make haste. The British fleet is approaching the bay.



Two weeks later…



IDontStink My betrothed ‘let one go‘ at supper tonight, right in front of everybody, then he blamed it on my plum pudding. #ihatehim



DocBentIt FUNFACT: Witchcraft due for a comeback, human soul weighs 3.2 ounces, more Vermont goblin sightings TinyBraodsheet81 #CottonMatherInst.ofScience



MatronlyMom I’m at the market. All they have that’s fresh are rats. I’m getting the putrid beef instead, again. :(



YankeeYuppie @DandyCandy Speaking of which, is it true they have to hide the livery boy whenever you’re @3ForksTavern? #pwned



DandyCandy @YankeeYuppie Bring it Hillbilly. I’ve heard what the ladies say about your aim. #pwned



IDontStink Just heard my betrothed traded his thoroughbred for a washer woman and a used carriage. # iluvhim



YankeeYuppie @DandyCandy The General desires that I remind you we have plenty of powder and shell for the artillery, and we know where you live.



WillSail4Wine @MeFirst Finally rounded up the crew and set sail, departing St. Martinique. This better be worth it.



DandyCandy @MeFirst Lord C. does NOT tweet with rabble. Go back to your pig farm, Nature Boy.




DocBentIt FUNFACT: tooting low grade snuff, 3 times daily reduces risk of sinus infection 10% #newresearch



MatronlyMom I dumped the night-pot out the window. Someone drank WAY TOO MUCH ale last night. I’m making breakfast now.



MeFirst @Glutton4Gluttony Good morning, Your Rotundity. I do hope the artillery hasn't been disturbing your sleep. I am prepared to entertain the terms of your surrender, should you feel the need.

Great Tweets Through History

I'm still in the lurking phase on Twitter, but I think I'm beginning to figure it out. In this mornings Financial Times Gideon Rachman is beginning to figure it out too. Along the way, he imagines what Twitter feeds might have looked like at different times in history. My personal favorite of his is Karl Marx:

If Marx really had lived in the age of Twitter, he would probably not have been sending out thunderous political messages. It is more likely that his Twitter feed would have read: “Just arrived at British Museum. Going for a cup of tea.”

I can imagine a few others. Here's ten, in no particular order.

Ulysses S Grant during the siege of Vicksburg:
GENOFWEST Going to artillery barrage. Already have headache.

Hannibal crossing the Alps:
CARTHAGETOPGUY Frozen elephants twitpic #weird.

Brutus in the days leading up to the assassination of Julius Caesar:
SATURNSPAL 10% off @Romulus Cutlery. Good stuff.

George Custer at the Battle of the Little Big Horn:
YELLOWHAIR Arrived @ Indian Village. The place is packed.

Thomas Jefferson at the Constitutional Convention:
VIRGINIAPEN Added preamble to doc. John likes it. Will show to others forthwith.

From the Lewis and Clark Expedition:
BOATMAN Picked up crackerjack Indian gal. Husband's a douche.

John C. Fremont from somewhere in Nevada:
FUTUREPRESIDENT Idiots can't find the cannon. Moving on.

Adolph Hitler responding to a tweet from Normandy Beach:
YESTHATFUERHER @LOVINGPARIS wtf???

Christopher Columbus discovering America:
ITALIANSAILOR Arrived @ India. It's not what I imagined.

A converstion between Alexander Graham Bell and his assistant while inventing the telephone:
AGBELL @BELLASSIST Can you hear me now?

BELLASSIST @AGBELL No. What?

AGBELL @BELLASSIST Did you say something?

BELLASSIST @AGBELL No. Was in bathroom.

AGBELL @BELLASSIST Say something.

BELLASSIST @AGBELL Did you hear that?

AGBELL @BELLASSIST Delivery boy at door. Say again.

Stealth Laws and Subsidy Bubbles

HR 2454, The American Clean Energy and Security Act of 2009 passed the House on Friday. It is a 1,090 page document with a 300 page amendment document that apparently was never reconciled before the vote. This led to an interesting question from Texas Republican Rep. Joe Barton:

"If a bill for which there is no copy were to actually pass this body," Barton asked, "could the bill without a copy be sent to the Senate for its consideration?"

Answer: Not unless Pelosi and Reid have telepathic powers of which we are unaware. Should a bill ever materialize in the physical realm, it's likely most senators won't read it either. Which raises another question; Can anybody still call this "representative government" with a straight face? I suppose that the act of voting either up or down would represent someone. But who?

From what I gather from people who have some semblance of an idea what's in the bill, it contains taxpayer funded subsidies for renewable energy projects. Unlike the "hard news watchdogs" who are busy barking at Michael Jackson's multiple autopsies, George Will has some actual information about it in his latest opinion piece. He includes a link to a study done by economics professor Gabriel Calzada at the Universidad Rey Juan Carlos. Spain is a world leader in renewable energy production. Not coincidentally, Spain also has an official 18% unemployment rate. Some excerpts from the reports summary:

Spain’s experience cited by President Obama as a model reveals with high confidence, by two different methods, that the U.S. should expect a loss of at least 2.2 jobs on average, or about 9 jobs lost for every 4 created, to which we have to add those jobs that non-subsidized investments with the same resources would have created.

...it is not possible to directly translate Spain’s experience with exactitude to claim that the U.S. would lose at least 6.6 million to 11 million jobs, as a direct consequence were it to actually create 3 to 5 million “green jobs”... the study clearly reveals the tendency that the U.S. should expect such an outcome.

Each “green” megawatt installed destroys 5.28 jobs on average elsewhere in the economy: 8.99 by photovoltaics, 4.27 by wind energy, 5.05 by mini-hydro. These costs do not appear to be unique to Spain’s approach but instead are largely inherent in schemes to promote renewable energy sources.

Professor Calzada's study goes on to discuss the dangers of "countercyclical" situations. The countercyclical is a fairly simple, mainstream idea familiar to any economist, and goes like this:

1) The government wishes to fill a perceived need and calls for incentives (taxpayer subsidies) to be provided to private industry.
2)The taxpayer funds are used as a selling point to attract private investors.
3)Investors, seeing a potential for short term growth, add their money to the pool (artificial demand and misallocation of resources).
4)Unpredictable and uncontrollable market forces (hurricanes, civil unrest, etc.) cause growth to slow, stop, or recede.
5)Private investors, seeing their returns drying up, pull their money out, causing the government to call for further and larger subsidies, which creates the countercyclical.
6)Seeing a possible recovery, private investment returns.
7) The cycle repeats with ever higher peaks and ever deeper troughs (Elliot waves).
8)The end is reached when government is either unable or unwilling to sustain ever larger subsidies to a now massive industry. Private investors, sensing that the end is near, begin selling in panic and the largest downturn of them all ensues.

We have seen two of these countercyclical patterns in the last twenty years. The technology bubble of the 1990's was allowed to crash. We are currently in a countercyclical period with the financial industry. It may or may not be the last; time will tell. Might we avoid all this and allow people to invest in value rather than artificial demand? Have our representatives learned nothing in the last twenty years? I wish I could be optimistic, but I see interesting times ahead.

Vote For Me, I Only Take My Pants Off At Home

As a general rule, I don't comment much on social issues. It's not that I don't care about them, but I'm hardly a poster boy for the family values set. I make no claims to marriage counseling skills, relationship building formulas, or advice for the lonely at heart. However, given the twin SNAFU's in the Republican ranks of late, I think remaining silent would be a mistake.

I think we can all agree that fidelity is a good thing and infidelity isn't. And, it's not just for married people either. Fidelity to ones country, ones family, ones cause, ones friends, and so on, is a good thing. Go down the list and fidelity is always better than infidelity. The point overlooked here is that even by bachelor standards, (yes, there is such a thing) both of these guys are seriously unhinged. Let's start with Governor Sanford.

Argentina? The guy went all the way to Argentina just to get a little sugar in his coffee. Had he gone to the Adirondacks, like his staff said, and picked up the first cutie impressed with his clean fingernails, I could skip this post. I mean, I might drive to Dayton for it, maybe as far as Fallon even, but Argentina? For God's sake man, get a grip. The rule here is that anytime you have to board an airplane to chase a skirt, you've probably lost all sense of perspective.

And then there's our own Senator Candypants: Cheated on the wife, strike one; she was married, strike two; and here's the kicker. Never, ever, ever, never, ever fish off the company pier. Never. Ever. Or, as an old friend once explained it, 'A dog don't eat where it shits. It's just common sense'. If your amount of common sense is something less than the average canine, you have no business being in the front yard.

Now then, since we Republicans are in a back-to-basics mentality, lets revue; near = good, far = bad; single = good, married = bad; friend = possibly good, co-worker = bad. It's not that difficult. If you're having problems, perhaps you could make some flash cards. I'll bet the wife might even be willing to help.

I'm glad we had this little talk.

Keeping Up With The North Koreans

I don't remember hearing about this when it happened, or maybe it was one of those news items that went in one ear and out the other. The article describes a gunfight on Dec. 22, 2001 between the Japanese Coast Guard and a suspected North Korean "spy ship". It makes for some pretty sobering reading in light of the UN Mandate regarding vessels suspected of carrying nuclear contraband.

There is also some naval maneuvers described here regarding the North Korean threat to launch a "test" missile towards Hawaii.

With all the attention on the Iranian's fight over who will represent the Mullahs, it seems to me this is the more important story. The attention on Iran could be short-lived. Happy Father's Day from the Axis of Evil.

Fed Transparency

Texas Congressman Ron Paul's Federal Reserve Transparency Act (HR 1207) now has 234 cosponsors including Dean Heller (of course), and Shelley Berkley, along with 64 other House Democrats. From the summary:

Directs the Comptroller General to complete, before the end of 2010, an audit of the Board of Governors of the Federal Reserve System and of the federal reserve banks, followed by a detailed report to Congress.

The cozy relationship and cronyism between Wall St. and Washington would surly make for some interesting headlines in the future.

Meanwhile, over in the Senate, the companion bill, S.604 has only 2 cosponsors and is currently in the Committee on Banking, Housing, and Urban Affairs. Neither Nevada Senator has spoken about it. Senator Ensign has been a little preoccupied with a zipper malfunction lately, and Senator Reid presumably wants no part of it; the Senate Bill I mean.

Progressive Roots and Silent Tigers

When I was little I would sometimes ask my Grandma to tell me a story about "the olden days". She was born in 1892 and she was a Grandma straight out of central casting; short, plump, with wavy gray hair and enough wrinkles to make a prune jealous. She would always start with "Things were very different when I was a little girl". She'd then go on to tell me about Christmas Day supper - no presents, block ice delivered by horse drawn wagons, and all the things one could buy with 2 cents. She had seen many wondrous inventions like airplanes, washing machines and deodorant for men, but she never said a word about politics. That, apparently, was Grandpa's realm.

He had grown up in the mines, and was a solid pro-union Democrat all his life. I learned later, much later, that he had also been a bit of a drinker and a "brawler" before Grandma made a church-goin' family man out of him. That would explain why Grandpa didn't like to tell stories to little boys about "the olden days". Too bad. I'm sure he must have had some classics.

So now I'm reading Jonah Goldberg's Liberal Fascism as part of the Voxiversity group. For the record, I went 9-1 on the first quiz. Vox seems to be taking his time with this one, so I've been able to read ahead. The first 3 chapters cover the early years of Mussolini and Hitler, and a thumbnail sketch of the life and times of Woodrow Wilson. What is most striking about this time in our history is the popularity of fascist/socialist ideals.

Democratic Capitalism was seen as having run its course. It was too messy, too chaotic, with too much wealth and power concentrated in too few hands. Liberty and individualism would need to be replaced. It would be easy to demonize the early fascists/socialists, call them misguided, put them in a nice, neat little box and label them as damaged goods. Easy, except for the fact that they had no foreknowledge of what would transpire in the coming decades, and for me personally, the case of Grandpa's tigers.

In my mother's house are two pictures of tigers. They are finely woven with silk thread in the oriental style. Grandpa received them as a gift from a group of Japanese miners for his efforts in improving their working conditions. The exact details of what he did are unknown. Did he risk his next promotion? Did he risk his job; his life? Did he get what he wanted, or settle for what he could get? Nobody knows. Grandma did most of the talking. We only know that he helped them somehow, and they were grateful. Which brings us back to the importance of individual liberty.

No matter the system, it is the individual that senses injustice, judges right from wrong, decides on action or non-action, and ultimately learns to live with his own conscience. When the meetings are over, the arguments made, the deals cut, the doors close and we have only ourselves to combat. Collectivism can do none of these things without appealing to and convincing the individual. The lone conscience, searching itself, will always have the final word.

Palin Hits Back

As if winning the election wasn't enough, the left continues their attacks on Sarah Palin. What are they afraid of?

Visit msnbc.com for Breaking News, World News, and News about the Economy

I have to love the "so-called comedian" bit. Nice shot.

Fascism 101

Voxiversity 3 is starting this week with Jonah Goldberg's "Liberal Fascism". Before any of my lefty friends out there roll their eyes, Vox says there's plenty in there about Republicans too. Just having read the introduction (the first assignment) Goldberg has already identified Compassionate Conservatism as fascist and says that No Child Left Behind would have been a good fit with Mussolini's school reform policies.

But, this will mostly be about the roots of the American Left. Up until World War 2 fascism was pretty popular in the U.S., and many of it's ideas are still with us. The turn of the 20th Century ushered in many changes in the relationships between government, business and the military in our country. It's an important time to study.

There are 2 big problems with the study of fascism. 1) There is no consensus as to what fascism is. A lot depends on the culture it arises in and the personality of the leader. It is not necessarily racist. 2) The Holocaust tends to overshadow any debates on the subject. The anti-semitism in Germany was not matched by the Italians. Two surprising facts are that there were several Jewish fascists serving in Mussolini's government up until the Nazi invasion in 1943. Fewer Italian Jews died in WW2 than in any other European country except Denmark. Not all fascists were/are Nazi's.

If anyone is interested, you don't have to sign up for anything; just get the book (available in paperback) and be ready for the first quiz on Saturday. Having watched the first 2 voxiversities go by, I'll warn you; Vox keeps a pretty brisk pace, so it will take a serious effort to keep up. Assuming I'm not culled from the herd, I'll be posting some updates as I go along. It should be fun and enlightening.

Remember

The Negative Interest Rate Explained

There have been several articles written over the last moth or so about the possibility of negative interest rates. Conventional wisdom holds that interest rates can not go below zero. With the Fed Funds Rate currently at 1/4%, any further action by the Federal Reserve would have to be negative. Raising interest rates would be the smart thing to do, but is politically unacceptable. So, are negative interest rates possible?

The easiest way to understand the idea is explained by Alex J. Pollock writing in American.com:

Would anybody rationally pay $1.02 for $1.00 in cash? They do today, if they take cash as a non-customer from an ATM. The average ATM surcharge fee is about $2. For a $100 withdrawal, that is equivalent to a price of $1.02. Alternately thought of, if a $200 withdrawal were cash for one month, the average fee would be equivalent to a negative 12% interest rate.

Currently, the banks are using the bailout money to increase their deposits with the Fed in an effort to cover all their bad loans and toxic assetts. One way to get the banks to release the money would be for the Fed to "go negative", giving the banks an incentive to put their newfound wealth somewhere else.

The problem for the Fed right now is that all other interest rates, including passbook savings accounts, ultimately take their cue from the Fed Funds Rate. Imagine the political fallout when us commoners are not only paying to bailout the banks with our tax dollars, but seeing our savings drained by those very same banks. The resulting bank run would not only bring on the collapse of the Federal Reserve System, but would surely spell the end of several political careers.

It's the proverbial rock and a hard place and a good reason why I believe the Federal Reserve System is about to be replaced, either by choice or by default.

Correction(s)

In case anyone missed it, Jillian's Dad left a comment that reads in part:

They (the Mitty Monarchs) were playing for the Division II California Central Coast Section Championship and with the win they remained ranked #1 in the country on both the ESPN and USA Today high school softball polls.

Apparently this citizen journalist needs to invest in a 99 cent notebook along with his fancy-shmancy camera. Management regrets the error.

Bernanke Loses Grip On Reality

Federal Reserve Chairman Ben Bernanke made some unbelievably stupid statements before a House panel yesterday.

“Maintaining the confidence of the financial markets requires that we, as a nation, begin planning now for the restoration of fiscal balance.”

Let's take a look at the "confidence of the financial markets" that Mr. Bernanke seeks to maintain. Here's what the confidence in Citigroup looks like:



Here's the confidence in Bank of America:



But wait, somebody's confident in Goldman Sachs:



The company with the inside line to the Treasury Dept. looks to be coming along just fine. I'm becoming increasingly confident that the game is rigged. Here's another pearl of wisdom from the chief:

“Unless we demonstrate a strong commitment to fiscal sustainability in the longer term, we will have neither financial stability nor healthy economic growth,”

After 2 quarters of -6% GDP, and trillions of dollars poured down the toilet that is the financial market, this amounts to a deathbed conversion. Anything short of disassembling the Federal Reserve System, and throwing the bankers into debtor's prison, won't restore financial stability. Unfortunately, few of our leaders are set to "begin planning" for that.

Charts courtesy of bigcharts.com

Notes on a Spring Break

For part of my vacation, I went to visit my Dad in Las Vegas. In between a busy schedule of eating, drinking, and laying about, we managed to visit a few petroglyph sites in the area. Grapevine Canyon is about 50 miles south of Las Vegas and well worth the trip.



Unlike northern Nevada petroglyphs, which are carved into basalt and last for thousands of years, petroglyphs in the south are carved into oxidized granite. As the oxidation weathers away, the petroglyphs fade out. These are probably 2-3 hundred years old. Just judging from some of the designs, they're of a much more recent vintage.



We visited a few other petroglyph sites that weren't nearly as impressive as Grapevine Canyon, but in a meadow in Red Rock Canyon I spotted what I think is a wild Desert Orchid in late bloom. It's a rare sight, if that's what it is.



Speaking of wild desert flowers, I also met-up with E!!-lizabeth.



Yep, there I was, in a darkly lit uptown cantina, a rum and coke in one hand and a steak sandwich in the other, plotting revolution with a classy dame. Man, I love blogging.

Then, it was back to San Jose to watch my niece, Jillian, play for the Central Coast Catholic League Championship. With 2 outs and a runner on 3rd, she stepped up to the plate...



They went on to win 3-0, finishing the season 32-0 and ranked 1st in the state. Some will say this is the result of good parenting skills. True enough. However, the effects of good uncling can not be overstated. It is the drinking of half of the dad's beer that allows good parenting to take place. It takes a village, don't-cha know.

Experts Grasping At Straws

I'm sure I'm not the only one to notice this, but the blame game over the economic situation seems to have entered full tilt boogie mode. First, it was all Phil Gramm's fault, no wait, it was Bill Clinton. Hang on a minute, it was Jimmy Carter's fault, no wait, it was Allen Greenspan that caused it all. Just a second here, what about Barney Frank? Now, here comes Paul Krugman blaming Ronald Reagan. It's awfully nice of Paul not to leave out the 'ol Gipper. Blaming the only dead guy in the group will surely end the argument.

Meanwhile. Vox Day continues painting the big picture uninterrupted:

...I doubt that it is necessary to do much more than wait for events to take their course. Pyramid schemes always fail in the end, and there are an increasing number of signs indicating that the post-Bretton Woods reserve currency system is rapidly approaching terminal status.

So bring it on boys, those of us at the bottom of the pyramid are as ready as we'll ever be. Solve the debt problem by creating more debt. Solve the over spending by spending even more. The sooner the collapse comes, the sooner the madness will stop. Maybe then someone in the expert class will ask the right question; Who was doing something right when things were going well?

On Vacation

At 5PM Friday I'll be off like a prom dress for some much needed and overdue R&R. I'll be away from computers most of the time, so my experiments in digital technology are on temporary hold. Not that there has been a lot of progress lately, so maybe a break from blogging will be good for me too. I'll be back in a week or so.

Geese Are Really Smart

It came to my attention recently, that certain Reno bloggers don't like geese. I would like to remind one and all that geese have several swell character traits. The following video may be old news to some, but I think it will prove my point.

1)It is an established scientific fact that geese enjoy the company of humans.
2) Geese hate Fabio.
3) Therefor, Fabio is not human.
4) Geese, having figured this out, are really smart.

Notes from a Bystander

There’s been some interesting developments in the Reno blogger community lately, regarding first amendment rights and freedom of speech. It all started in an obscure corner of the world; women’s soccer at UNR. As the lawyers gathered, Ryan Jerz weighed-in with an opinion of it on his blog. Since Ryan’s interest in sports far exceeds my own, my initial reaction was something like, “I can’t believe he follows women’s soccer (?).” It was easy to pass it off as just another quirky interest of a fellow blogger.

But, it soon turned into more than that. The hyper-active soccer coach filed a defamation suit, of the harassment type, against Ryan, forcing him to take down his post. Bob Conrad wrote a 4 part post on the whole ordeal, and AG and LB have also written about it. Their posts and the comments sections make for some thought provoking reading.

There are a handful of bloggers that have been a lot of help to me over the past several months, and Ryan Jerz has certainly been at the forefront of that. There have been times when it appeared that Ryan was promoting my blog more than I was. I sometimes wonder how it is that I’ll ever be able to return the favors. It’s clear to me now that I missed an opportunity. Not that I could have offered any legal advice, or gone into high dungeon about the proper role of a free press in a free society. But, a simple note of support would likely have been welcomed, and certainly would have been better than nothing.

I don’t blame Ryan one bit for being disappointed in the general lack of response. The term “blogger community” is probably overstating what we have here. There are some loose-knit bands and temporary alliances, but no real community. In an effort to keep the conversation from fading away, I’d like to point out that along with freedom of speech issues and other high moral principles, there are some basic human principles to consider as well. Two of them would be giving back for what one has received, and sticking up for one’s friends.

It’s true the landscape has changed. It’s also true that we have it within our power to create what we wish, and one person can not build a community by himself.

About That Government Transparency

Nick Gillespie of Reason, has a video interview with Mike Pickett, CEO of Onvia, who has recently created a new website called Recovery.org. It is in direct competition with the Obama Administration's Recovery.gov, which to date is reporting exactly zero of the stimulus money it was meant to track. Officials say they hope to have something on the site sometime in October, or maybe early 2010. Onvia's site is already tracking over $40 Billion worth of stimulus money and estimate they will be tracking $100 Billion by October.

Onvia is in business to help small, independent contractors nationwide place bids for government projects. It's in their own self interest to provide a transparent accounting of the stimulus money. You can go to their website and call up any state, county, and/or city and watch the gravy train roll by. In the meantime, score one for the greedy capitalists.

Lockwood Goslings

I was out in Lockwood for part of the morning scoping out a spot for Episode 2 of "Tales from the Rue de la Noir." Normally, the geese there stay on the far side of the river where there's less people and no dogs. Today two groups came over to the near side. I got a couple of shots before the parents got nervous.

Tales from the Rue de la Noir

In episode 1, a classic masterpiece of Johann Sebastian Bach is taken out of context and cut to pieces for the puerile amusement of the global community.

On a personal note: My first effort is pretty sloppy, with lots of room for improvement, but I think I'm getting the hang of it.

Towards a Tangible Value Economy

I don't know if it's the fact that politics has become too depressing for me, or my preoccupation with my new digital toys, but I'm still paying marginal attention to the news. On President Obama's plan to reduce the importance of Wall Street though regulation, my Libertarian Thought Leader of choice, Vox Day lays it out in one sentence:

So long as the paper money system exists, the easiest and fastest way to obtain more of it is to play paper games.

Regulating Wall Street beyond that of other markets, will only drive the brightest minds towards those other markets. The root cause of our dilemma is that the Federal Reserve Note has no tangible value. It is only an I.O.U. from the government to the people, based on the people's trust that the government will still be with us tomorrow, presumably to hand out more I.O.U.'s. It's difficult to see the government going anywhere any time soon, so the trust is maintained, if only slightly.

If, on the other hand, the dollar was backed by gold, silver, or any basket of commodities, it would take on a tangible value independent of anyone's level of trust. With a tangible valued currency, the best minds would gravitate to producing tangible assets, as that is where the most value would be. Manufacturing, intellectual property, even farming would assume a new importance. Who knows, newspapers might make a comeback.

It's an idea that used to work, and could be made to work again, if only our "leaders" would try it. What, real assets traded for real money with all having real value? Nah, just another wing-nut idea from the hinterlands.

Gosling Update

It's only been a week, and the goslings at Rancho San Rafael are noticeably bigger. They swim a little, nap a little, but mostly they eat.

The Specter Trade

Republican Senator Arlen Specter was traded to the Democrats today for an undisclosed amount of cash and a governorship to be named later. In a prepared statement, Coach Harry "Silver Tongue" Reid said of the deal: "Arlen's unique abilities to drone on and on without ever coming to a point will be very helpful in the upcoming health care debate. We welcome him to our team."

Not all Republicans were happy with the deal. Maine's Olympia "White Shoes" Snowe, after expressing disappointment in not being part of the trade said, "I hope this doesn't mean that it's going to be all principles all the time now. It's so tedious. I just don't understand it. What's the point of having principles if you can't ride around in a limousine the rest of your life?"

Republican coach Mitch McConnel stated: " We really wanted to make Olympia part of the deal, but we were up against the deadline and couldn't get it done. They were only willing to give up a county commissioner seat in DeBuque for her. We just couldn't make it happen."

Team Democrat now has a virtual "Murderers Row" of gasbags to overwhelm all opposition. Coach Reid even went on to speculate that after ramming through everything everyone ever wanted, they may try to make history by redirecting the course of a tornado later this summer.

Tales from the Rue de la Noir

I spent most of the weekend shooting meaningless and mostly unusable video. One of the places I went, for no particular reason, was Lockwood, up the canyon east of town. They're building a park there called Lockwood Trailhead. It looks like it will be pretty nice, once the landscapers are finished. I also saw another set of goslings, but the parents were nervous so I couldn't get a good shot of them.

As I was leaving, I drove into the town of Lockwood, which isn't really a town but a trailer park. It's not half bad, as trailer parks go, but I had to laugh at the street names. They're all in French. There's names like Avenue de Colours and Ave de la Argent. I believe that should be Ave de L'Argent, but what do I know. My knowledge of the French language is roughly equivalent to that of your average Trailer Park Planning Commissioner. Apparently, whoever names these things believes that fancy French names add glamour and status. They don't. They do however, force you to explain why you live on a street with an idiotic name. The conversation might go something like this:

Person 1: So, where you livin' now?
Person 2: I'm over on the Avenue Da Champs Da Leezay.
Person 1: (pause) What?
Person 2: I say I'm over on the Avenue Da Champs Da Leezay.
Person 1: (pause) Where the hell is that?
Person 2: It's the trailer park.
Person 1: Oh.
Person 2: Yeah, when you get there, just keep goin' straight and it's just past Rudy Culldisack Street.
Person 1: OK.

My personal favorite in Lockwood is the Rue de la Noir. I could imagine drunken dance hall girls careening down the dark, foggy street, and being a trailer park, may not be too far off the mark. Could a modern day Toulouse Lautrec be sitting in his driveway, painting portraits of lawn gnomes while discussing the philosophy of country music with his neighbors? Would the spectre of Edgar Allen Poe appear through the early morning mist? I don't know, but it's a great name for a video series. The challenge will be, to find something the least bit entertaining in Lockwood.

Reno's New Arrivals

Yep, it's definitely springtime.

Memo To The Grasshopper

I regret to inform you that your job as mascot of Local So-And-So is being phased out. You have done your duty well, my little friend, but the situation has changed. The world turns, and time is a friend to no living thing. It's not even a friend to a picture of a living thing. At least, I assume you were alive when your picture was taken. Anyway, plans for the entire stock photography library have been put on indefinite hold.

As I'm sure you're aware, the blogoshere being what it is, we all need to keep pace with the times. As we transition to original content, your arrangements in the hard drive will remain the same. Remember, communicators never say "good-bye", only "see you later,", or words to that effect. I will always admire your symmetry, your simple forthrightness, to say nothing of those cute little antennae. But we must part ways. Both you and the hippopotamus will still be invited to the company picnic.

Sincerely,

Local So-And-So
Purveyor of Fine Quality Social Media

Reid Fundraiser Protest Video

Duty called and I was stuck at work on Wednesday, so I missed the TEA Party protest. I managed to swing by the Harry Reid fundraiser later that day. It was reported that Republican Mayors Bob Cashell of Reno and Geno Martini of Sparks would be at the Democratic Senator's fundraiser. Naturally, a few Republicans were a little annoyed with that. Of course, I muffed the money-shot of Mayor Martini leaving the building with a sheepish grin on his face. Maybe it's just as well, unlike Mayor Cashell, Martini at least had the guts to exit from the front door.

Homemade Charts

Yeah, it's been quiet around here lately- a little too quiet. In between messing with my new camera, video editing demos, and format conversion programs, I've reached one of my long-term goals; making my own charts. My method was to start with the most grandiose idea I could imagine, and as the number of failures mounted, work my way down to the simplest thing possible.


This chart shows the Consumer Price Index (CPI) measured against the value of the 1793 dollar. In other words, if you had earned $100 in 1793, the first year of production for the US Mint, you could have bought $100 worth of stuff. But, if you had saved that money until 1794, how much stuff could you have bought then? What about 1795, 1796, and so on, until 2008.

There are several points of interest in this method that I'll be exploring in more detail later. One hears economists talk of the strength of the dollar today, but this is true only if it is measured against other currencies. It is a subjective value measured on a subjective scale. The year 1793 provides a point of reference for an objective scale. The dollar's value has always been, and will always be, subjective. It's the nature of the beast.

Japanese Robot Women To Invade Moon

Hardly a week goes by that I don't see a story regarding Japanese Robot Women. This time, they are preparing to land on the moon.

Photo from Drudge Report

I can think of only three reasons for the Japanese Robot Women phenomenon:

a) Japanese scientists really need to get out more
b) Critical equipment can only be located in the area of the bust line
c) Both a and b are true

I'm beginning to think the Japanese scientific community owes the world an explanation. Shouldn't the leaders of NOW be raising concerns about this? As yet, there's no word on whether or not the moon rocket will be equiped with dual nosecones.

And here's another one. A Japanese Robot Man, named "Adam" has made his own scientific discovery involving yeast enzymes. But, not to worry. Adam is only a prototype. Eve is under construction. According to her creator:

“Eve is better designed and more elegant.”

Well, being better designed kind of goes without saying, doesn't it fella's? And elegance, everybody knows Japanese Robot Men are obnoxious brutes. They can't even tell the difference between a soup spoon and a soup ladle. They'd probably drink out of the gravy boat if left unsupervised. Yes, better to send the Japanese Robot Women to check the place out and make sure it's OK for the Japanese Robot Children. There's no telling what the moon would end up looking like if the Japanese Robot Men landed first.

Speaking Truth To Power

There's been a welcome development on the freedom front lately. I've been a bit preoccupied with my new Flip video camera that I bought on Saturday ( more on that later). Last Thursday, Gordon Brown, the British Prime Minister gave a speech at the European Union's Parliament. Daniel Hannon, a former journalist who is now representing south England in the EU, and OMG, he's a blogger too, responded.

This morning, Vox Day, who makes his living as a video game designer, posted an interview with Mr. Hannan. By way of a preview, an excerpt from the interview:

Day: Who are your intellectual influences with regards to economics? Do you go all the way back to Smith?

Hannan: Absolutely, I'm a very traditional Brit like this. I've got two busts in my office. One is Adam Smith, the other is Thomas Jefferson.

I'm not sure Jefferson would qualify as a traditional Brit, but I've got to like this guy. He sounds like my kind of journalist.

No Heroes In Tone Deaf Corporations

There's an excellent post over on Pajama's Media about the AIG bailout and its relation to the Titanic. It should be of interest to anyone interested in marketing, the current dissatisfaction among the citizenry, and historical research. It's written by Bill Whittle and compares the AIG Officers actions with those of the White Star Line after the Titanic sank. It is also a good example of what a great post looks like.

If you're feeling uneasy about all this bailout stuff, but are not sure why, you'll know after reading this.

Poker For Profit

The reviews are in and Treasury Secretary Geithner's newest plan to rescue the economy has been met with near universal disdain. The political left would rather see the banks nationalized, and object to the public/private aspect of the plan. The political right can't be in favor since, well, it's not their plan. It's essentially the same plan we had, but now that the other side is in charge, and have changed its name from TARP to TALF, we're against it. For a more non-ideological pedestrian view, we need to turn to the capitalists.

Tyler Durden writing for Seeking Alpha lays out the case in 8 logical steps. Better yet, in the comments section he gives insight into the mind of a true capitalist. The "non-recourse nature" he speaks of means that once the public/private entity buys an asset from a bank, the private investor has control of the asset.

Posted by Tyler Durden at 2:14 AM
The greatest bait and switch of this generation in all its visual splendor. As a result of the TALF's non-recourse nature, a hedge fund X can buy Bank X's MBS Portfolio which is marked on the bank's books at 80 cents on the dollar (but has a market price of 20 cents) for the marked price with a 3% equity check and TALF filling the balance. A day later, Bank X repurchases the portfolio from hedge fund X at the 20 cent market price, pays a $5 million fee for the "trouble" and waits for the portfolio to appreciate to 50 cents on the dollar by 2014. Hedge fund X takes a 75% loss on its nominal equity stake but more than makes up in transaction fees. The TALF portion takes a 75% loss with no recourse and no margin to fall back on.

As a result Bank X takes no writedown now, and in 5 years may book an equity profit of as much as $25 million (net of transaction fees paid to the Hedge Fund X), while Hedge Fund X books a profit of $3.2 million for one day's work...

Lastly the U.S. taxpayer loses $54.3 million on a $77.6 million TALF Investment, or 70% (net of 5 years of interest income).

Note: the maximum TALF size is $1 trillion. Will U.S. taxpayers suffer $700 billion in losses from the TALF? Ask your congressman.

And if you want to know why government intervention never works as advertised, or how the rich get richer, ask someone who stays up 'til 2 in the morning figuring out how to make $3 million a day.

Is The End Nigh, Yet?

March 18, 2009, I’m marking it on my calendar. Was that the day our president admitted to a high bowling score of 129? No. It was the day the Federal Reserve announced they would begin buying Treasury Bills. In effect, we are now loaning money to ourselves. There is only one reason why anyone would do this. Nobody else will loan us the money. Like an overzealous mall rat, we are paying off one credit card with another credit card. It is the last act of the soon to be bankrupt.

Ever since Hillary’s visit, the Chinese have been making public noises about their nervousness over our debt. They’re financing quite a lot of it and they have good reason to be nervous. With the currency being inflated, they won’t be getting the returns they were expecting when they bought in. Having taken our best customer to the cleaners, can we really expect them to come back for more?

There are stories circulating that the US dollar is going to lose its reserve status. It’s a subject you’ll be hearing more about once the upcoming G20 meetings get under way. Reserve status is a huge advantage to us. Not only do other countries buy dollars for emergency use, but also having our own currency as reserve, allows for all sorts of game playing with the debt. And boy have we been playing games with our debt lately.

Other countries resented us for it before, but now they are being pushed over the edge. Any group of countries can create a currency amongst themselves, and it looks like some are going to give it a try. Russia seems to be the ringleader. There is certainly talk behind closed European doors going on.

Here's what the metals have been doing through all this. The blue line shows the day before; stable and trending slightly down. The red line shows a spike up at the time of the announcement. The yellow line is the day after.


The same with silver:

I'm not quite ready to start walking around downtown with an "The End Is Nigh" sign, but a little metal under the floorboards might be a good idea, if you don't have some already.

Protest Government Spending

I'm not sure how readable this flyer is going to be, but there is going to be a protest against the money laundering going on in our government these days. It will be on April 15th, 10:30 to 1:30 in front of the capitol building in Carson City. All are welcome to join. You can find more info here.

Ignoring the Customer

It's hard to believe now, but I used to enjoy reading Kathleen Parker's opinion pieces in National Review. I stopped when she turned on Sarah Palin for not being sufficiently sophisticated for the Washington champagne circuit. I stopped reading a lot of people then. Now I've come to find out that she has a thing against bloggers.

There’s something frankly creepy about the explosion we now call the blogosphere — the big-bang “electroniverse” where recently wired squatters set up new camps each day...Each time I wander into blogdom, I’m reminded of the savage children stranded on an island in William Golding’s Lord of the Flies. Without adult supervision, they organize themselves into rival tribes, learn to hunt and kill, and eventually become murderous barbarians in the absence of a civilizing structure.

Let me guess. The "civilizing structure" would be Kathleen. Apparently she is unaware that running naked through the forest is not only serious business, it's loads of fun. She should try it sometime. It might loosen her up a little. She continues:

Drive-by pundits, to spin off of Rush Limbaugh’s “drive-by media,” are non-journalists who have been demonizing the media for the past 20 years or so and who blame the current news crisis on bias.

There is surely room for media criticism, and a few bad actors in recent years have badly frayed public trust. And, yes, some newspapers are more liberal than their readership and do a lousy job of concealing it.

Where do I start with this? There was a time, not so long ago, when one who worked for a newspaper was called a reporter. A journalist is something different. Journalism, so I'm told, allows for perceptions and feelings. And guess what Kathleen; your feelings are of no more consequence than those of any blogger picked at random. As for "a few bad actors"; how about a whole troupe? The players in Washington may seem Shakespearean to you, but from this distance it looks like yet another high school performance of "Harvey". And who needs to pay for liberal opinion? It's in the ether. I would pay to escape it, but not to read it. She continues:

But the greater truth is that newspaper reporters, editors, and institutions are responsible for the boots-on-the-ground grub work that produces the news stories and performs the government watchdog role so crucial to a democratic republic.

Yes, about that crucial "watchdog role", where were you when the current mess was developing? How about the mess before this one? As I recall, wasn't that you in the comfy chair licking your ass? It's time you put that "boots-on-the-ground grub work" ethic to practical use and sniff out a new business model.

If the Gazette Journal folded tomorrow, Anjeanette Damon would still have a job. Why? Because she is in demand from people like me. And when it comes to Ms. Damon, there are a lot of people like me. We would search her out, find her new venue, and continue as before. As for the Washington troupe, just look for the room with the comfy chairs.

God, I love blogging.

Catching Up with Dilbert

As noted earlier, the new time zone is still wreaking havoc on my schedule. Looking through some old Dilbert blog posts, I found this:

One could argue that previous economic bubbles were driven by sex, directly or indirectly. Guys bought cars to attract girls. The VCR business thrived because of porn. So did the Internet. If you want to predict the next economic boom, figure out who is inventing technology that 19-year old boys will crave in order to increase their chances for sex. Any ideas?

Here's mine:

Japanese Robot Babes! When one of these shows up at the high school prom, we'll know 2 things. 1) The next boom cycle is here and, 2) the end of the human species is not far behind. They never nag, don't get jealous when you flirt with other robot babes, and they take instructions. The perfect 10.

Finance Magic

In an article about the Obama Administration's problems in staffing the Treasury Department, Stephan Green, the Vodkapundit points out an interesting phenomenon:

According to a recent Reuters story, Blackstone Group CEO Stephen Schwarzman estimates that “Between 40 and 45 percent of the world’s wealth has been destroyed in little less than a year and a half.” Think about that. There was no 9/11 in New York, no nuclear bomb going off in London or Beijing, no fleets of bombers destroying factories — there has not been any physical destruction of capital whatsoever. Yet in the last 18 months, nearly half the wealth in the world has vanished into thin air.

Well, as every mother has said, at least once in her life, "Things don't just disappear, it has to be somewhere". So, where did nearly half the world’s wealth go? The answer depends on your view of reality. If the wealth was real, then it ended up in somebody’s pocket. If wealth is only a promise for future work, then it is not real. It can appear and disappear as easily as any other promise.

We are all familiar with optical illusions. Magicians make their living with them. Is there such a thing as a financial illusion?

You've worked and saved, and you're ready to buy a house. The work you have done is real. The money that was exchanged for your work is real; it is equal to the work you have done. So you plunk down 20%, and the bank covers the other 80%. Except, the bank doesn't have the 80%, they only have 2% on deposit with the Federal Reserve. The remaining 78% of the value of your house doesn't exist, not yet. But in the eyes of the banker, he has a note; a tradable commodity. He uses that commodity as a down payment on a bigger promise, and that commodity on an even bigger promise still.

All it takes to end the illusion is one broken promise; one call for a show of real wealth within a group of people who have none. When the illusion is over, what have we lost? You still have your house, your work, and you're keeping your promise. The banker still has houses and no real wealth. He's right back where he started.

I've heard we have lost our trust. Well, no kidding. Who would trust a magician?

A Few Useful Links

Is it my imagination, or did the switch to Daylight Savings Time wipe out a few bloggers (including me) this week. The early morning hours are prime blogging time for me, so I haven’t accomplished much this week. But, I did promise a few examples of the presentations at the Interactive Summit.

Thanks to a comment from Ryan Jerz in my last post, there is an excellent Twitter feed that has links to many of the presenters. Here are a few highlights.

Mike Henderson’s summary of his talk on podcasts is here. Even if you’re not thinking about podcasting, you can see it’s pretty thorough.

Mike McDowell’s Media 101 is in slide show format. I don’t know if it will make sense to someone who wasn’t there, but it’s a lot better than the notes I took. Trust me on that one. I’ve started using google reader as a result. It’s working out really well. It saves a lot of time and is much less aggravating than going back and forth from the blogroll. What I’d really like to do now involves an aggregator. It would be something like Nevada Blogs, only it would be the blogs I choose. So far, everything I’ve seen to do this involves HML, so I’m still looking.

Marcel Levy’s summary is in PDF format. Marcel doubles as a stand-up comic. Who would have guessed that building charts could be so much fun? There are some hard to find web addresses in here. I know they’re hard to find because I’ve looked for them, so this will be very helpful.

There’s plenty more on the search twitter link. I have months worth of projects just from these three. I'm off to visit mom this weekend, so I still won't get much done, but maybe I'll adjust to the new time zone.

Notes on the Summit

I attended the Nevada Interactive Media Summit held at the Reynolds School of Journalism on Saturday. Is it possible to suffer information overload, and still not have heard enough? The conference was designed in three groups of workshops per hour, over five hours, so I didn’t get to hear everything I wanted. Still, by day’s end, I had to go home and give my poor little brain a rest.

There were a few themes that nearly everyone was talking about. One of these was strategy. Most of the presenters were marketing people, as were a majority of the audience, but what is the goal of blogging? Every so often I come across a blogger asking: ”Why do I do this?” It’s a bit like asking a weekend artist why he paints landscapes. There are a thousand reasons, and no reason in particular. The more I do this though, the more obvious it becomes that there are abundant opportunities for the taking. The field is wide open, and setting some long-term goals would probably be a good idea.

Another constant throughout the day was the importance of mobility; that means gadgetry. Most of the talk was about programs and applications, but sitting here at my desktop is already considered somewhat quaint and old-fashioned. I put a lot of effort into keeping my life simple. This blog naturally reflects that. I’m not a gadget guy. Still, the place could use a little variety. I now have a much better idea of how to accomplish that without getting tied up in USB cables. I can liven it up a little while maintaining a minimalist approach.

One thing everyone could agree on was the need to filter out all the chatter and concentrate on only the things that apply to them. No doubt, there is somebody filtering out this blog post right now. There are some time saving techniques on how to do that, and there will likely be better ones coming along in the near future.

As hokey as it sounds, the best thing about these types of conferences are the people. The knowledge, ideas, and experiences, the friendliness, the focus, it’s a great way to spend a day. It’s always good to be reminded that behind every post, tweet, and camera shot is a human being trying to communicate. The fears of virtual isolation are much overdone, as the virtual has merged with the physical. Many of the presenters said they would post summaries on-line, so I’ll have an update with links up soon. Also, as I complete some new projects, I’ll be posting about how it went. For those that missed it, you’ll see it was worth the price of admission.

End the Fed

Thanks to Vox Day for pointing this out. It's too good not to pass along.

The Federal Reserve’s low interest rate policy is a big mistake; it is not a panacea.

Artificially low interest rates are achieved by inflating the money supply. Low interest rates penalize the thrifty and those who save are cheated. It promotes consumption and borrowing over savings and investing. Manipulating interest rates is an immoral act. It’s economically destructive.

The policy of artificially low interest rates caused our problems and therefore cannot be the solution. The market rate of interest is crucial information for the smooth operation of the economy. A central bank setting interest rates is price fixing and is a form of central economic planning. Price fixing is a tool of socialists and destroys production. Central bankers, politicians, and bureaucrats can’t know what the proper rate should be. They lack the knowledge and are deceived by their own aggrandizement.

Manipulating the money supply and interest rates rejects all the principles of the free market. Ironically free markets and sound money generates low rates, but unlike the artificially low rates orchestrated by the Fed, the information conveyed is beneficial to investors and savers. The Congress, by conceding this authority, conveys extraordinary economic power to the elite few. This is a power that has been abused throughout history. Only the Federal Reserve can inflate the currency, creating new money and credit out of thin air, in secrecy, without oversight or supervision. Inflation facilitates deficits, needless wars and excessive welfare spending.

Debasing a currency is counterfeiting. It steals value from every dollar earned or saved. It robs the people and makes them poorer. It is the enemy of the working man. Inflation is the most vicious and regressive of all forms of taxation. It transfers wealth from the middle-class to the privileged rich. The economic chaos that results from a policy of central bank inflation inevitably leads to political instability and violence. It’s an ancient tool of all authoritarians. Inflating is never a benefit to freedom loving people. It destroys prosperity and feeds the fires of war. It is responsible for recessions and depressions. It’s deceptive, addictive and causes delusions of grandeur with regards to wealth and knowledge. Wealth cannot be achieved by creating money by fiat. It instead destroys wealth and it rewards the special interests.

Depending on monetary fraud for national prosperity or a reversal of our downward spiral is riskier than depending on the lottery.

Inflation has been used to pay for all wars and empires. And they all end badly. Inflationism and corporatism engenders protectionism and trade wars. It prompts scapegoating: blaming foreigners, illegal immigrants, ethnic minorities, and too often freedom itself for the predictable events and suffering that result. Besides, the whole process is unconstitutional. There is no legal authority to operate such a monetary system. So let’s stop it. Let’s restore a policy of prosperity, peace, and liberty.

The time has come. Let’s End the Fed.

Congressman Ron Paul's speech to Congress 2/25/09

Housing and Recessions

I ran across a article at Calculated Risk that has 20 good charts; so many that I had trouble picking just one. This chart shows the relationship between housing construction and recessions, and brings up 2 important points.


The first point is that housing spikes and recessions are not necessarily related. There are several smaller spikes in home construction outside the recession areas.

The second point is when recessions contain housing spikes, one sure fire way to end a recession is to stop building so many unsellable houses.

I recently started following Guy Johnson on Twitter. He blogs at Reno Realty. The last post there discusses a house in the "bungalow district" on the "wrong side" of Wells Avenue. It's selling for $89,000. Out of curiosity, I drove over. It's definitely a fixer-upper. It has aluminum siding on the street side and, well, something else on the other 3/4's. Several large tree stumps decorate what used to be a backyard lawn. Still, I came away with a vague feeling of optimism. It was a real house, on a real foundation, and I could afford it if I wanted it. That's assuming I could find a banker foolish enough to loan me tens of thousands of dollars.

With our government insisting on creating jobs and stemming unemployment, it means we will still be building more unsellable houses and prices will continue to fall. And, thanks to our government, there are plenty of foolish bankers still in business. Who knows, in another 6 months, I might be able to afford a decent house in a decent neighborhood.

So keep the bailouts coming Mr. President; keep that monopoly money flowing and the bubble expanding. I'm almost there. Too bad for everyone else though.

Problems at CPAC

Republicans are the pro-business party. Why then are we so lousy at public relations?A case in point from Patrick Poole at Pajamas Media:

...those of us inhabiting the official bloggers row, sponsored this year by Pajamas Media, are clearly considered the red-headed stepchildren by CPAC’s organizers. The best evidence for this was that bloggers row was situated at the back corner of the exhibit hall (which doubles as the first floor of the hotel’s parking garage). The organizers could not have positioned us any farther from the events here at CPAC without setting us up outside the building. In contrast to political left, where bloggers and new media have propelled Democrats to stunning victory and are courted by their politicians at the annual Daily Kos convention, the conservative establishment still has no idea what to do with new media.

OK, here's a pop quiz for all you Republican "leaders". If you take your date out to dinner, and the waiter gives you a table that is closest to the kitchen, with banging pots and pans competing with angry shouts from the cooks, do you tip him 0%, 5%, or 10%? If, on the other hand, the waiter seats you and your date next to the window, where she can overlook the gardens as the evening sky turns from pale blue pink to Rosy red, do you tip him 25%, 50%, or leave an endowment to his kids?

Needless to say, Mr. Poole was not overly gracious in his comments on the rest of the conference. He went on to point out that most of the speakers were the same retreads that caused our collapse. Looking at the straw poll, I can't say I have a lot of hope for 2012 yet.

Mitt Romney...20% (Are Mormons ready for a Mormon President?)

Bobby Jindle..14% (Makes Bob Dole speeches seem thrilling by comparison.)

Ron Paul......13% (Will he ever get 15% anywhere?)

Sarah Palin...13% (The thrill is gone, maybe.)

Newt Gingrich.10% (Who?...What?...Really?)

Mike Huckabee.07% (Not many Baptists at CPAC this year.)

Mark Sanford..04% (Did we ever decide the Confederate flag issue?)

Rudy Giuliani.03% (Aw Rudy, we'll always have New York.)

Charlie Crist.01% (Apparently candidates were allowed to vote for themselves.)

The good news is we have 4 years to work on it.

The Soak the Rich Myth

I once worked for a very wealthy man. He was the kind of guy who would make the interns, who were already working for free, take the company car over to his house to clean his swimming pool. He was the kind of guy who once had an employee load a bale of hay into the back of his brand new pick-up truck, drove around town showing off his new truck, only to have the employee unload the truck upon his return. He had no other use for the hay bale. He was the kind of guy who, after downgrading the employee retirement plan, bought a prize steer for $25,000 and invited his friends over for a bar-b-cue. As grandma might have said, he was a piece of work.

He bought a new Cadillac every year. He owned at least three homes that I knew of; his house on the hill in the swankiest neighborhood, a well appointed "cabin" in the mountains, and a home in Hawaii. Every December he would leave for Hawaii and not return until the spring thaw in March, while those of us who were gainfully employed kept his income stream going through the sub-zero Colorado winters. Needless to say, there was a little grumbling among the employees from time to time.

One of the nice things about working the night shift is that if you hustle through the first seven hours, you can put your feet up for the eighth. On a January night, a few of us were sitting, listening to the wind howl, watching the snow "fall" from left to right, wondering if our cars were going to start, when we began grumbling. After a while, one guy who had been sitting quietly looking out the window, said to no-one in particular, "Ya' know, if I had his money, I'd be in Hawaii right now too." Good point.

What brought this memory back this morning was an article in Pajamas Media by Jennifer Rubin, about the latest tax plan.

A taxpayer in the 35% bracket gives a gift to United Way of $10,000. Under the current rules he can reduce his tax bill by $3500. Under the Obama plan he can only reduce his tax bill by $2800. In the Obama scheme, then, that United Way contribution now costs the taxpayer $700 more. The obvious result: give less to United Way so the higher tax bill can be paid. To be blunt, the government is discouraging charitable giving. It is hard to think of any worse tax policy or any one more harmful to the needy.

If there is one thing that I can say with absolute certainty, it's that we all want more than we have. Everybody has dreams. If I only had $1,000 I'd get this; $5,000 I'd get that; $50,000, and I'd definitely buy one of those. Well, what if you did? What if you lived a lifestyle that allowed for Christmas in Hawaii, springtime in the Rockies, and five figure checks to a variety of charities? Where would you cut? Would you tell the wife she’ll have to do her Christmas shopping in sub-zero weather, or shave a little off the donations? You could take those $10,000 checks down to $9,000 and still make it to Hawaii. $9,000 is still a lot of money. You could tell yourself that you're still being generous, and you'd be right. Just a little bit less here and there, and you won’t have to tell your friends that instead of prized-steer ribs, this year you’ll be serving mutton. Be honest with yourself. Which would you choose? Really?

Real Trust Requires Real Capitalists

Plowing through the hyperbole that the financial sections have become, one can sometimes find a little perspective. Rob Kirby writing in Financial Sense looks back on the road we have traveled:

Banks in the 19th century were owned by real capitalists and the equity capital of banks was about 60–80% of their balance sheets: bankers were lending or investing their own money, so they were responsible and did not accept excessive risks.

The 19th century also had what were called "wildcat" banks. These were often owned and operated by thieves and counterfeiters. They were located throughout the country, but were especially prevalent in the territories. They were characterized by the fact that they only had enough money to convince the locals that they had more. Today, we call that "a low reserve ratio".

Following a succession of bank panics, the central banking system was created in 1913 and called the Federal Reserve. And here is where it gets really interesting. The reserve ratio was set at 3%-12% depending on the size of the bank. What only a year before had been considered dishonest at best and criminal at worst, was now institutionalized as the norm. Shortly after this, the honest banker disappeared. The gold standard became a political football, before being phased out. With no cultural pressures, and no system of measurement, the wildcats could run free.

The required reserve ratio at the Fed is currently 10% on transaction deposits (checking and savings), and zero on everything else. Homes, cars, credit cards, entire businesses, have all been financed with nothing. And what of those savings accounts? Of course, there are plenty of exemptions and waiver rules included for favored political donors. Mr. Kirby continues:

...an accurate and logical accounting of where we are would amount to a confessional by the powers-that-be, punishable by law.

I don't see that anything is punishable by law. Inaccuracy and illogical accounting is the law. The lack of trust we see today is only the widespread realization that the money center banks are insolvent. They have been for a very long time. The banks are broke and everybody knows it. If the banks had been built on real wealth, regaining trust would be quick and easy. As it stands, what's to trust?

Leeches On the Back of Society

A universal constant in the world of the rich and powerful is that they will always do what is in their own self-interest. It's how they became rich and powerful to begin with. I have no problem with that, but anytime one of them says something that ordinarily would not be in their own self interest, I have to wonder; What's the game?

The Drudge Report carried a story from Reuters about "renowned investor" George Soros, saying:

the world financial system has effectively disintegrated, adding that there is yet no prospect of a near-term resolution to the crisis.

Really? It's more likely that Soros Fund Management Inc. has effectively disintegrated and there's no near-term resolution to George Soros' crisis. But, it gets even better:

...the turbulence is actually more severe than during the Great Depression, comparing the current situation to the demise of the Soviet Union.

Let's take a deep breath and calm down for a minute. Hedge funds have been taking an even worse beating than the New York banks. Hedge funds borrowed from the banks to buy the toxic assets that are causing all the problems. The banks are in trouble, not just because they too own some toxic assets, but because the hedge funds can't pay off the loans for theirs.

Soros Fund Management, located in the Cayman Islands (where else?), is a group of hedge funds. The largest of these funds, Quantum Fund, plays the currency markets. Mr. Soros and his ilk take the money of the rich and move it from country to country, going long on strong currencies and short on weak currencies. If you can talk enough rich people into letting you manage their money, you can do what Mr. Soros did.

In 1992 he bet the whole wad on shorting the English pound. The attack on the pound was so overwhelming that it became a self fulfilling prophesy. It broke the Bank of England and caused a devaluation in the pound. Mr. Soros and his wealthy clients walked away with billions, while the English working class saw the price of everything go up. Later in the decade, he nearly destroyed several Asian currencies. The farmers, the fishermen, the shopkeepers, all paid the price for the fame and fortune of Mr. Soros.

So what's the game today? I'll take a wild shot in the dark and say that Soros Fund Management needs a big government intervention; not only to help their currency positions, but in applying the Treasury Dept.'s magic eraser to all those toxic assets sitting in the Cayman Island offices.

But not to worry, Mr. Soros and his wealthy clients are philanthropists. They help all sorts of working class people with all sorts of problems. In other words, they destroy the working class, so they can help them. This is how the rich get richer, the poor get poorer, and the powerful solidify their grip. This kind of game is beyond mere hypocrisy, it's beyond even simple BS. It's dangerous.

Deconstructing the Lost Decade

There has been much talk of Japan's "Lost Decade" recently. In the IBD this morning, Robert Samualson lays out a few pertinent facts.

First and foremost is that, historically, government stimulus has a mixed record. Sometimes it works and sometimes it doesn't, and nobody knows why. Each situation is different enough that there is no conventional wisdom that applies to all.

Today, on one side of the argument, President Obama warns of a Japanese style stagnation; on the other, conservatives argue that the Japanese government instituted eight stimulus packages, none of which accomplished anything. They are both right and wrong at the same time. The Japanese experience has little to do with what we are going through now for the simple reason that we are not Japanese.

Japan has what Richard Katz, editor of the Oriental Economist, terms a "dual economy." On the one hand, export industries (autos, steel, electronics) are highly efficient. They face intense global competition. On the other, many domestic industries (food processing, construction, retailing) are inefficient and sheltered from local competition by regulations or custom.

Since the early '80s, U.S. economic growth has depended on a steady rise in consumer spending supported by more debt and increasing asset prices (stocks, homes). Just as the mid-'80s signaled the end of Japan's export-led growth, our slump signals the end of upbeat consumption-led growth.

The problem in both cases is, once the formula has played itself out, where to find new areas of growth. Our government has been driving out manufacturing, or inviting them to leave, for decades. Americans really don't make much anymore. Now that consumers are staying home, we don't buy much anymore either. If we don't make anything or buy anything, then what are we doing?

This problem is bigger than any stimulus can solve. If we bring back the factories, we'll bring back the jobs, and bring back the growth. Anything less is wasted effort.

When Subs Collide

The Sun newspaper is reporting that a British nuclear submarine collided with a French nuclear submarine somewhere in the north Atlantic. There doesn't appear to have been a breach of the hull in either vessel and no loss of life.

My dad served as a sonar man on a submarine in the north Atlantic during WWII. When I was a kid, I would ask him if he ever saw any action. Did he ever sink any Germans? He would calmly reply, "Heavens no, being 300 feet underwater with 100 drunken sailors was dangerous enough."

I wonder if the British Navy still serves rum rations?

Economic Fascism?

I'd been thinking about this subject for a while now, and this morning Michael Ledeen had an article on it. Is what's going on in Washington socialistic, fascistic, or just plain bad policy?

It has always been easy to tell the difference between capitalism and communism. They are divided by property rights and the means of production; capitalists have them and individual communists don't. But economically speaking, there are no clear lines of demarcation between capitalism and socialism, or capitalism and fascism. These three "isms" all allow some degree of property rights and some degree of government intervention, but are largely social constructs with no clear economic distinctions.

Hitler's Germany is a good example of the lack of distinctions, as the NAZIs never gave much thought to economics. There was no NAZI economic policy that I've ever found. They tended to do whatever worked best in supporting the military machine and left it at that. Mussolini's Italy is a little better, but even there they were heavily militaristic with no clear economic philosophy. Industry was directed to the betterment of the state, whether nationalized or left in private hands.

Wikipedia may not be the best source, but I did find this:

Historian Gaetano Salvemini argued in 1936 that fascism makes taxpayers responsible to private enterprise, because "the State pays for the blunders of private enterprise... Profit is private and individual. Loss is public and social."[26]

Sound familiar? I don't know what we are heading towards, but whatever it is, it makes unbridled capitalism look pretty good by comparison.

New Improved Zombies

There is a new phrase being coined regarding a perceived impending disaster that is our economy. It is the "Zombie Bank". I vaguely remember this term being used during the Japanese banking crisis in the 1990's. It's origin may be older, but I'm beginning to see it used in the US financial pages more often now. It's loosely defined as a bank that the market (us) sees as obviously insolvent, that the government central planners (them) refuse to allow to go naturally. Andy Kessler, writing in The Wall Street Journal gives an example:

Despite over a trillion in assets, Citigroup is worth a meager $18 billion, Bank of America only $28 billion. The market has already figured out that the banks and their accountants haven't fessed up to bad loans and that their shareholders are toast.

Citigroup, having had a $25 billion infusion from Old Uncle Larry, is set for round two with Tim Geitner. Like a young Dr. Frankensteen, Geitner is sure to have a pocket full of treats, as he leads the Citigroup Zombie through "Puttin' on the Ritz". I know I'm mixing metaphors here, but the question of the day is this; How well can the Citigroup Zombie sing and dance? Simply eating the flesh of the living just isn't going to be good enough anymore. We need zombie banks that can carry a tune; and if not dance the Tango, at least a saltzy Texas Two-Step to please the crowd.

And to think, the only price of admission is a fistful of toxic assets. Be sure to keep them in your pocket, you may need to show them later. They'll also make a nice souvenir for your memory book. So, sit back and enjoy the new improved zombie banks doing the high step down the avenue while singing, "We're All Keynesian's Now!", and prepare for the zany hijinks of the hit comedy of the season; "Honey, I Shrunk the Capitalists".

It's going to be quite a show. If not a Golden Age of Zombie Bank entertainment, certainly a Copper/Zinc Age.

The Individual Power Station

Scott Adams, the Dilbert cartoonist, has identified a basic modern problem, and the beginnings of how to solve it.

One of the frustrations people have with the current economic downturn is feeling they are helpless to do anything about it. We are told by the media that only the government is big enough to fix our problems.

Remember after 9/11 how President Bush told us to just go about our business? It was as if to say, "Move along folks, nothing to see here, just move along." Why doesn't the government ask anything of us? Isn't it strange that they don't?

It wasn't so long ago that President Kennedy said, "Ask not what your country can do for you. Ask what you can do for your country." 300 million individuals working towards a common goal could accomplish anything. But, nobody's asking us. Apparently, at some point between Kennedy and Obama, we stopped offering. So, leave it to a cartoonist to have the best idea yet.

Suppose President Obama ordered the power companies to make one change in policy. Not only would they credit the bills of customers who have solar panels on the roof when they generate more power than they use, as is the current situation, but they would actually pay customers cash for any energy created beyond the limit of their own monthly bill. That would make any home with a Southern exposure a potential generator of electricity. The President could ask citizens to invest in solar panels, as an act of patriotism, knowing the payoff would take years, but the collective benefit to the country would be great. It would stimulate the economy, create jobs, and drive down the cost of solar panels. And your neighbors could see your new solar panels and know you were doing your part.

Imagine tens of millions of clean energy companies run by private individuals. Each one energy independent, with at least the beginnings of a multiple income stream, and the costs to the poor being only in the distribution. Think of the effect on Nevada property values.

If the people in Washington DC would look at the governed as something other than a potential threat to their power, they might think of something like this. As things stand now, we are left with presidential decree's, legislative pissing contests, and the idle musings of cartoonists.

The Comedian's Craft

A confluence of events yesterday led me to Barnes & Noble bookstore to spend my Christmas gift card. One of the books I bought was "Born Standing Up" by Steve Martin. It's a very readable book about his early years and has quite a few surprises.

The biggest surprise is the story itself. When Steve Martin burst on the scene in the mid-seventies, we all thought he was a new comic. In fact, what we were witnessing was a performance artist at the end of the road. Weaving music, magic, salesmanship, and just plain entertainment, all the while taking classes in philosophy, psychology and art at Long Beach and UCLA, Mr. Martin developed his craft for the better part of two decades. This is the story of a guy who was willing to lay it all on the line for two dollars a show in near empty rooms.

Another thing I really liked about this book is there's not much name dropping. The names are largely unfamiliar; Magicians at Disneyland, theater actors at Knott's Berry Farm, and nightclub managers in San Francisco. Occasionally, he meets someone I'd heard of before, but not often. It was a tough life. It's the kind of life only the most dedicated romantic could stay with.

Mr. Martin also includes some pretty personal stuff about his family. This is not a tell all, but as he explains it"...a complicated childhood can lead to a life in the arts. I tell you this story of my father and me to let you know I am qualified to be a comedian." For all the silliness of his stage act, Steve Martin is a serious, logical thinker. This heartfelt telling of his own story shows a complicated man struggling to create something new, and once created, walking away from it to create something else.

Broken Windows and the Unseen

I happened across an interesting chart earlier this week. With all the back-and-forth about the next Great Depression one is tempted to look at the years 1930 to 1940. What is really instructive are the years 1941, '42, and '43. We might conclude from this chart that WW II was a wonderful time.



And, why not? Employment was at an all time high; anyone who wanted a job could get one. Real wages rose as a large part of the labor force was directed into unproductive endeavors, never to return. Exports were, well, booming. (Pun intended). There are some who say that war is good for an economy; and the bigger the war the better. These people, needless to say, are idiots. Economics, like everything else, is ultimately about people. Numbers are only a reflection of the lives people are living, and sometimes that reflection can be a poor one.

Another trail I followed led to Frédéric Bastiat and his Broken Window Theory. Briefly, it is the story of a shoemaker's son who one day breaks a window at the shop. All the neighbors agree that fixing a broken window has many benefits, one of which is that it provides a job for the glazier. Left unseen, is the productive use the money paid to the glazier might have gone to. Bastiat goes on to argue that any ruler can immediately double employment simply by cutting off the right hand of everyone in the kingdom. (I need to find out more about this guy).

Today, there is general agreement that the Bush bank bailout was an unproductive use of our national wealth. The folks in Washington seem determined to try something similar in other areas. All manner of numbers are being tossed around to "prove this, and "prove" that. No doubt, there are some bridges that need fixing, and reducing the long term energy costs of government buildings seems reasonable enough. Still, those of us who continue to "stand athwart history yelling stop" can only look on in sadness. Our leaders have been foolish. There are precious few left to count the unseen costs of fixing our country's broken windows. Who will ask, "What future improvement will be left undone because we used our money recklessly today?"

Chinese Automakers Outsell US

For the first time in history, the automakers in China have outsold their US counterparts. January auto sales fell to 9.8 million, compared to China’s estimated selling rate of 10.7 million. With our rising unemployment, one has to wonder when China will start shipping jobs over here to take advantage of our cheap labor.

Emily Kolinski Morris , Ford’s senior economist is quoted as saying, “There are some faint signals emerging that we may be nearing the bottom.”

I doubt it. The Obama Administration seems determined to repeat the mistakes of Herbert Hoover by raising taxes and dishing out money we don’t have to the states for infrastructure. The good news is, that Hoover increased federal spending by 30% in 1930, while President Obama is only planning a 25% increase in 2009. I suppose we can call that progress.