Doc 224899

Here Comes the 'Double-Dip Recession'

You Da Man, Jeff!

But, hey, why not "Perpetually Multi-Dipping Recession"?

Right now a major contribution to supporting the major indices is b.s. rhetoric from a bunch of obedient media gasbags and market manipulation by the President's Working Group on Financial Markets.

Another factor supporting value growth for a few corporations in the major indices is the inevitably rising cost of basic materials and energy resources, though most corporations will be unable to generate profits, all of which will continue during peak oil and peak commodity conditions until global markets completely collapse.

Major indices have gotten very toppy, during this brief upward jog in the overall downhill slide, and it's time for a correction (regression towards a decreasing mean).

Government thugs, oh, uh, I mean assistants to Secretary Geithner, will do some back room arm-twisting, oh, uh, I mean economic emergency response networking, and bank executives will go along with instructions to put defaults on the books from Alt-A and Prime rate mortgages all at once, at the same time as the market correction, to create a timely financial crisis that we can only be saved from by a master stroke by our generous president to be known as Stimulus II (the next big money grab in the socialist Liberal Elite campaign to redistribute wealth and unite "the workers" and "the poor" against "the wealthy" and other people who can tie their own shoes without government assistance).

While all this is going on, our national and global economies are inevitably contracting due to peak oil and peak commodities, and growing populations in "developing" countries will increasingly retain energy and material resources and not export them to the west.

Maybe we should call it "Perpetually Multi-Dipping Recession".

Recovery and the Banking System

Taxing the banks to save the economy?

Let's think this through, step by step:

1) Government taxes people who work and make things and perform useful services. Call these dollars earned by people who actually earn them "honest dollars", and these are honest dollars taken as taxes by the government.

2) Government soaks up 90 cents of every honest dollar collected as tax as the cost of collecting, counting, and redistributing the money.

3) 10 cents from every honest dollar taken as taxes by the government makes it back into the economy in government spending, grants, etc., and some of these shrunken dollars, formerly honest dollars, wind up going to the banks, where the government taxes it again.

4) 90 cents of every dollar taxed from the banks gets soaked up by the government as the cost of again collecting, counting, and redistributing the money.

5) 10 cents of every dollar taxed from the banks again drips back into the economy from the government, again as "redistributed wealth". By this time it is actually 1 tenth of the 10 cents from the first honest dollar collected from people who do honest work.

How the hell does this stimulate the economy? It only stimulates the government. How stupid do they think we are?

U.S. Housing: The Big Picture

Used car salesmen used to be the most pitiful businessmen in the country (if we can all agree that Al Bundy didn't actually work).

Now the most pitiful businessmen are new house building contractors (some of whom have already transitioned into the used car market, and others are on their knees at Shoe World SuperStore).

Investing Lessons from Tiger Woods

I just passed a billboard advertising a golf course community endorsed by Tiger, dominated by a headline stating: "See what motivates Tiger!" I was so glad I didn't have a home there, and that I hadn't been the boy wonder who came up with that advertising campaign.

Take-home investing lesson from all this: if you're in it for the long haul, put your money on Arnold Palmer or Jack Nicklaus or Greg Norman; if you're looking for a briefly blazing flash in the pan accompanied by bimbos who get excited by really big money, you can probably get away with something else of lesser value...

Geithner Just Doesn't Understand

Geithner would never have been appointed if he "understood".

He was, however, appointed because he has no fear that a hole in the ground will open up under him and drop him directly into the eternal agony of hell when he makes statements like, "And I'm, personally, very confident it was the right thing to do, and we did it in the best way possible for the American people."

Illusion of Economic Growth Accompanied by Massive Government Deficits Coming to an End

As long as the media can convince people who are freezing their butts off that they are dying from global warming and shouldn't burn coal to keep warm, hot air can prop up the major indices.

Name the World's Most Evil Company

I can't agree with yellowhoard, always dangerous but this time necessary.

The currently most evil company is the President's Working Group on Financial Markets, followed close behind by the US Dept of Energy, due in no small part to some current corporate leadership problems.

Nowhere to Go Economically but Up?

We are in a contracting national and global economy due to peak oil and peak commodities.

Even the President's Working Group on Financial Markets cannot change this inconvenient truth, though they can manipulate market sectors, certain select stocks, currency values and the price of gold for brief periods of time

Compensation: Another Approach

Obamanomics wants to take away all behavioral rewards for superior performance. That way everybody is equal.

Why? Because even those with the lowest functioning vote, and they are much easier to control. A Marxist power grab is easier in a pseudo-egalitarian world. Point an accusing finger at the brightest and best, and accuse them of wrong-doing. Claim their income and bonuses are proof of their wrong-doing.

We dummied down the schools to slow up classes in an effort to not fail the dimmest minds in the classrooms. We gave everybody who showed up and didn't commit manslaughter in the classroom a gold star. We stopped doing math problems in the front of the room, so students who did their homework and learned their lessons wouldn't be revealed to the entire class, and prevented losers from being shamed and humiliated.

Now we punish the CFO's and CEO's, but let a liberal elite that pushes trillions of dollars around enjoy secret wealth and concealed privilege.

It's socialism. It's the French Revolution.

Be afraid. Be very, very afraid.

Did Demand for Credit Really Fall?

Oh, please!

First 9-11, which triggered a little reality-testing among shoppers, so they stopped wasting money on shoddy Chinese knick-knacks that they threw in the back of a closet without even taking them out of the Wal Mart bag. This lasted for 6 months or so until the mind-numbing fog of consumer economics kicked back in and the liberal media decided to stop reminding people they were constantly threatened by the clear and present danger of a global jihad.

Now, the 2007 - 2010 economic contraction, when people decided for once and for all that they really didn't need shoddy Chinese knick-knacks that never made it out of the Wal Mart bag. Then they realized it wasn't fun after all to catch one speckled trout as the payoff for running a 225 HP Mercury outboard for 5 hours on a Saturday.

And that's what happened to credit. People just are going to stop borrowing on equity to buy stuff they don't need that has no enduring value.

When a 79.9% APR Credit Card Is a Good Thing

79.9% credit cards are good for lazy bankers who got used to easy money. Credit card debt has become a tax on the stupid, levied by lazy bankers.

There is a heck of a lot of stupidity floating around, so lazy bankers got rich, and forgot how to make profits legitimately.

Why legislate credit card rates? The stupid are going to lose their money to preditory dirtbags one way or another, so it might as well be to men who know how to wear a baseball hat correctly, who belt their trousers above their hips rather than above their knees, and who know how to make a double windsor knot in a necktie without looking in a mirror.

Physically-Backed Platinum, Palladium ETFs Have Arrived ... Finally

The spot price of platinum will co-vary with trends in two fundamentals.

The fundamental it will track is the price of gold.

The fundamental that will influence leveraging (it goes up when gold goes up, but it goes up a larger or small percentage than gold; it goes down when gold goes down, but it goes down by a larger or small percentage than gold) is manufacturing that requires platinum for calalytic exhaust scrubbing, most of which will be new car production for units to be sold in countries that require clean air standards.

We can probably expect the automobile trade in India and China, where the greatest growth in car sales will occur, will NOT require catalytic converters (they really don't give a flip about air quality), so car sales in markets in "developing countries" won't boost platinum prices.

The remainder of the demand for platinum for catalytic exhaust scrubbing will be in industrial exhausts, such as coal power utility plants. Again, the Chinese and the Indians really don't give a flip about air quality enough to buy platinum exhaust scrubbers, so that market won't support platinum demand either.

The bottom line: gold will be a better investment than platinum; and we might as well burn coal for the next hundred years because China and India will pollute so much more than we can possibly pollute than any money we spend on clean air initiatives will fail to make even a tiny change in global air quality.

Our Energy Future: Two Very Different Visions

I hereby defy Stanford University civil and environmental engineering professor Mark Z. Jacobson and University of California-Davis researcher Mark Delucchi to do the math, and show their work, for the alternative/renewable energy plan they proposed in Scientific American if they include the financial cost and energy investment and material requirements for the following:

1) gathering and refining all the rare earths and thin film materials and silicon crystal material for manufacturing all the photovoltaic cells;

2) gathering and refining all the iron ore and bauxite ore and molybdenum and nickel and chromium ores to make all the turbines and all the neodymium for the magnets for the turbines, and for their towers and stands;

3) all the copper and steel and aluminum for all these installations and the power distribution grid to connect it all.

There is not enough energy, money, and materials on the globe for mankind to search for and find and extract and refine and manufacture the component parts for all the alternative power generating stuff they propose, while simultaneously satisfying the needs of the growing population that is already there and using energy and resources in the conventional manner, with the "developing contries" doing all the developing and using more and more of the resources in their own countries.

It simply cannot be done, and these liberal California university guys cannot make the numbers work out if they factor in all the real costs and demands for materials and energy and fresh water to create the alternative system they propose while maintaining the current system until their new toys come online.

Show the math, guys! I dare you.

Alpha Natural Resources: Breaking Out Despite the Stronger Dollar

Re: ANR and WLT,

All the discussion about flyash being a toxic by-product of coal power utility plants that nobody knows what to do with misses the point that it is A TERRIFIC PAVING MATERIAL, produced in large volumes all over the country, which we could inexpensively use to fix our inadequate interstate highway system. In one application, it requires no external heat energy or fresh water for it to be applied in a roadbed, generating its own heat energy and using water vapor from the atmosphere to cure itself into a hard mass.

How about some stimulus money for that, eh?

Wednesday Options Recap

re: PCX and KOL

All the discussion about flyash being a toxic by-product of coal power utility plants misses the point that it is a terrific paving material, produced in large volumes all over the country, which we could inexpensively use to fix our inadequate interstate highway system.

How about some stimulus money for that, eh?