WWF Politics?

Politics of smack down vs rational thought - well, it should make the media happy.

Democrats Form Super PACS For 2012 : NPR:

"Democrats railed against big-money political advertising groups in 2010. Now, they're forming their own network of such groups for 2012."

on Republicans

Sometime last year - she gets it right

Meghan McCain on the GOP:

Rather than the party of openness and individual freedom, it is now the party of limited message and less freedom.

Along with ideological narrowness the important PR battle is being lost.

Rather than leading us into the exhilarating fresh air of liberty, a chorus of voices on the radical right is taking us to a place of intolerance and anger

On how to have a discussion

A Code of Conduct for Effective Rational Discussion — LimbicNutrition Weblog

Easter Dinner

Quiet day with my bride

Steak 'n Shake

Because
A National Hamburger Chain We Can Be Proud Of - Taste of America: Six Things I Want to Eat in 2011 - TIME: 


(note: photo not of Steak & Shake burger)

There are some great hamburger chains in the U.S. — places whose patties are beefy, juicy and fresh, and are served nestled between halves of a properly airy and toasted bun. But sadly, they are all regional chains — Steak 'n Shake in the Midwest, Smashburger in the mountain states, the Counter in Southern California. When will a national burger chain come into being that serves something along these lines? I believe that this is the year. Too much money is being made by these minichains for the big national ones to ignore their success. Last year's stunt burgers and other marketing initiatives are over; now the long climb toward genuine quality control begins. But who will be the ones to pull it off?"

link collections

‘Longevity Project’ - Review - In 80-Year Study, Good News for the Diligent - NYTimes.com

Review & Outlook: The Obama Speech Downgrade - WSJ.com

Obama’s Young Mother Abroad - NYTimes.com

Online Help for Those Who Want to Make Tangible Stuff - NYTimes.com

FT.com / Comment / Opinion - Tighten your seatbelts: 2011 could be worse than 2010

Endurance

found tonight, use to manage this stuff ... 24hr racing, 4PM Saturday to 4PM Sunday

e pluribus unum

Soros, Bretton Woods II And The Twilight Of The Gods - Ralph Benko - A Golden Age - Forbes:

"Rather than State-controlled or Big Business-controlled economies … why not look to the people?

On February 7, 2000, The New Yorker’s John Cassidy wrote in a piece both brilliantly insightful and rigorously honest, “The Price Prophet,” that “It is hardly an exaggeration to refer to the twentieth century as the Hayek century.”

Not Keynes. Hayek.

Cassidy encapsulates the core insight of Hayek as follows.“This view of capitalism as a spontaneous information-processing machine—a ‘telecommunications system’ was how Hayek referred to it—was one of the great insights of the century. It may have been implicit in the work of some previous economists, notably Adam Smith, but Hayek was the first to spell it out. Even left-wing economists, who regarded capitalism primarily as a system of social exploitation, were eventually forced to concede the acuity of Hayek’s analysis….”"

Glut

Planning on making a killing with all your "stuff" on e-Bay?

Think again - simple supply & demand

Supply is high and growing - means crash in prices.

Downsizing Boomers Looking to Sell Their Stuff - SmartMoney.com:

"With some 8,000 Americans turning 65 every day, on average, and the senior population expected to double by 2050, millions are facing a massive, multifaceted purge that's turning out to be much tougher than they thought it would be. And millions more find themselves in similar quandaries as they deal with the truckloads they've inherited from packrat relatives. Indeed, whether they're leaving an heirloom china set at the local consignment store or packing a stately grandfather clock off to Sotheby's, many are discovering that the resale market is glutted with household goods. And oriental rugs are only the beginning. Got a home full of middle-market, traditional-style furniture to sell? Dealers say that stuff's plunged 50 to 75 percent in value."

North

Caribbean ?

Aegean, that wine dark sea?

Nope

Lake Michigan, looking due north, Good Harbor Bay this afternoon

Huh?

File under Whisky Tango Foxtrot

Who dealt this mess?

1 - F-ing thousand? ? ?

Libyan Rebel Insider Points to Weaknesses - NYTimes.com: "And now, as they try to defeat Col. Muammar el-Qaddafi’s armed forces and militias, they will have to rely on allied airstrikes and young men with guns because the army that rebel military leaders bragged about consists of only about 1,000 trained men."

Case Closed

Something like a Volt, despite being simply an overweight, overpriced Cruze, maybe, but straight electric - nope.

Long-term Nissan Leaf update: Hey, buddy, can you spare a plug? - AutoWeek Magazine:

"If you have an electric car, you have to plan out longer trips on Mapquest or Google Maps to make sure they're doable. It's math so simple even I could do it. But didn't."
and ... drumroll

"The lesson here? Just as you can't or shouldn't bring a knife to a gunfight, don't try to go farther than your EV can go on a charge. At least unless you are sure there's a 240-volt charger somewhere on your route with a J1772 plug."

China and the world

I seem to see more problems than Martin does - demographic wall looming, but some interesting thoughts

FT.com / Comment & analysis / FT Columnists - How China should rule the world:

"For the first time in its long history, China is dependent on access to imports of industrial raw materials. It is already the world’s largest importer of most raw materials. For China, policy in this area is of potentially the highest importance. Its immediate interest is to gain access to the world’s resources on favourable terms. It has decided, quite reasonably, to use its cheap capital and labour to secure this end. That is not only in China’s own interests but in those of other consumers. Since resources have global prices, any increase in supply is to the benefit of all consumers."

Euro issues

Shared doubts about European willpower to solve the issues.

FT.com / Comment / Opinion - View from a Yankee in the eurozone’s court:

"To a visitor from across the pond, the commotion in Europe over how to address its fiscal problems (or are they economic problems?) feels reminiscent of the disarray in America as its financial crisis unfolded a few years ago."

I still have my doubts

An aging economy (Europe) and a history of conflict (one of the main reasons for the Euro - to help end conflict), differing cultures (frugal, or live for today) ... not my choice for reserve currency

Another European Crisis Looming? - Newsweek:

"While the world has been transfixed with Japan, Europe has been struggling to avoid another financial crisis. On any Richter scale of economic threats, this may ultimately count more than Japan’s grim tragedy. One reason is size. Europe represents about 20 percent of the world economy; Japan’s share is about 6 percent. Another is that Japan may recover faster than is now imagined; that happened after the 1995 Kobe earthquake. But it’s hard to discuss the “world economic crisis” in the past tense as long as Europe’s debt problem festers—and it does."

B-A-C-O-N

One can never have too much

Money

Sex

Horsepower or

BACON

Bacon All Day:Men’s Journal

Crises Push Japan to a Crossroads - NYTimes.com

Demographics - the crux of the problem

Crises Push Japan to a Crossroads - NYTimes.com:

"“It’s possible that this calamity will rid Japan of its old order,” Mr. Horie, now one of Japan’s most popular authors and bloggers, wrote in an e-mail, adding, “It’s an opportunity to build a new Japan.”

But first is the rebuilding. There are many factors working against Japan’s ability to carry it out as successfully as it has in the past: the absence of strong national leadership, the country’s declining economic strength and the simple lack of young people in the northern region."


Prior related pieces
Dearth of Candor From Japan’s Leadership - NYTimes.com

With all the euphemistic language on display from officials handling Japan’s nuclear crisis, one commodity has been in short supply: information.

When an explosion shook one of many stricken reactors at Japan’s Fukushima Daiichi nuclear plant on Saturday, power company officials initially offered a typically opaque, and understated, explanation.

Bid to 'Protect Assets' Slowed Reactor Fight - WSJ.com

Crucial efforts to tame Japan's crippled nuclear plant were delayed by concerns over damaging valuable power assets and by initial passivity on the part of the government, people familiar with the situation said, offering new insight into the management of the crisis.

Japan Response to Nuclear-Reactor Crisis Breeds Mistrust - WSJ.com: 

"The U.S. government, signaling distrust of reports from Japan about the nuclear crisis there, moved Thursday to evacuate U.S. citizens and set up its own channels of information—a step echoed by some American companies that laid plans to trim their operations in the stricken country."

Kabuki

Problems have been piling up for years, soaring deficits, failed change of government, shrinking and aging population. Will this catastrophe be the final nail?

Will Japan become a "developing nation" again, sans youth?

Dearth of Candor From Japan’s Leadership - NYTimes.com: "With all the euphemistic language on display from officials handling Japan’s nuclear crisis, one commodity has been in short supply: information."

Richard Lehmann interview - Forbes

Some interesting thinking - invest in dividend paying stocks

Inflation As A Tool

Steve Forbes: Well, Dick, good to have you with us. You're a fixed-income guru. I want to get your theory on inflation; most normal folk think that the Federal Reserve is against inflation. Ben Bernanke surprised people when he said, "We like 2% inflation." But you think it's even worse than that.

Richard Lehmann: Well, thank you for having me, Steve. And the answer is yes. The fact of the matter is that when you look at the kind of problems that we have, the budgetary problems and the ability of the government to cope with that negative a problem, it looks like inflation is going to become one of the tools that they use to remedy the situation.

We've always thought of inflation as the consequence of bad policy. But I'm contending that inflation's is going to become the policy, in effect. And Bernanke's announcement of the 2% is a way of saying, "Well, you know, it's a safeguard. And it's better than deflation." But I think that the real target is probably more in the 5% rage. And it typically overshoots so you can get up as high as 8% before real policy moves set in.

But if you think of it, 5 to 8% inflation over ten years would remedy a heck of a lot of problems that we have today. Creates a lot of new ones, of course. But politicians are principally focused on those short-terms problems. And those are the ones that would be alleviated quickest by inflation.

Forbes: They have a theory called the Phillips Curve, which says you need a little bit of inflation to get economic growth. Experience shows that's nonsense but they still adhere to this theory; you thought the 1970s would have gotten rid of it with stagflation. But what leads you to believe they're going beyond the 2%, that in their heart of hearts, they really want 5% or 8%?

Lehmann: Well, because 2% really doesn't do much to solve the problems. And I think that the problems are so pervasive across a multiple of things, that the magnitude of the debt, the trade balance, the indexing of various cost components, which the government can modulate by the fact that it controls CPI -- which is another whole topic of how that's being manipulated -- in a way, it gives the government a tool that they can use where nobody has to hold a hand up or be held accountable.

Forbes: On the CPI, let's chat for that for a moment before we go back to QE2. You say how they concoct the thing understates inflation and therefore people don't really realize, even though they go to the supermarket or the gas pump and see prices are rising, that it's worse than what the official numbers indicate. Hedonic, you call it.

Lehmann: Yeah, the CPI is -- first of all they take the two biggest components out of there, food costs and energy, and say, "Well, that's too variable. It shouldn't be in there," which, you know --

Forbes: Core inflation.

Lehmann: Yeah, so, we'll go with core inflation. Now, you get into that and you have what you call hedonic adjustments, where you get a $20 increase in the price of a cell phone and they say, "Oh, no, no, no, no. That's really a $20 decrease in the price of the cell phone because it does so many more things than the old phones used to do." And consequently, they can basically delay the recognition of the true underlying inflation for months and months. And that, of course, has huge impact on things that are indexed to inflation, which is everything from tips to government salaries, Social Security and even some of the Medicaid.

Another Bank Bailout

Forbes: Now on QE2, we all thought that that was a device to goose the economy. You think it's part of the Fed effort to bail out the banks. Can you explain?

Lehmann: Well, after 2008 the banking industry was obviously in dire straits. So, they were terribly undercapitalized because of all the mortgage write-offs they had. And the Fed basically opted to give them an out. Rather than having to go dilute their capital tremendously by issuing new shares, they went and created this artificially low, short-term borrowing rate of 25 basis points.

And with long treasuries being about 4.5% at that time, a bank was able to, with leverage, basically earn over 4% rate of return, risk free, in U.S. treasuries. Of course, you can play that game. But the risk there is that if interest rates start to move up, you need to get out fast, if you're leveraged.

Last November, Bernanke, in effect, said that inflation is coming. And without saying that they should be getting out of the carry trade, he was in effect saying, "We're gonna make $600 billion available to the economy for buying treasuries," which was a way of saying, "We're going to deflate this carry trade bubble, so don't everybody rush to the door here at the same time."

And we see that that policy seems to be working pretty well. Rates have not gone up significantly since the initial round of this, where a few too many people did step up. So, we saw some uptick in the race. But effectively, he is deflating that carry trade bubble. But, of course, at the expense of buying back these treasuries at prices that are going to look pretty expensive in about six months after the program's over.

Forbes: But even so, given the fact that banks have leverage if the long bond goes from 3.5% to 4.5% to 4.75%, that's a huge loss, isn't is?

Lehmann: It would be if they were still in that position. But the Fed has basically held the yield at a steady rate and is taking back those treasuries at those price levels so that they've locked in. You think about it: They've earned over 4% leverage ten times. So, they've earned 40% for about two years. That's a heck of a nice return.

But there was another benefit to them of doing this in that, for two years the banks have been really occupied with resolving all the mortgage problems that they had on their books. And they didn't have a labor force to really do that. And so, effectively, by the banks employing all their assets in treasuries, they freed all their own officers, as a work force, to straighten out the mortgage that was on their books. This is why the banks weren't lending during that time period.

The Banks' Alibi

Forbes: How much of the non-bank lending is attributed to the fact that examiners were gonna give you a hard time if you made a business loan, which was not the same thing as buying treasuries?

Lehmann: Well, that was, you know, one of those things. It really, I guess, sort of, became a cover story, if you will, for the fact that the banks weren't interested in lending to the private sector, as long as they could make 4% risk free.

Forbes: And in terms of QE2, it expires in June. What's going to happen to the ten-year and the 30-year bond then? Is it going to go up?

Lehmann: They'll be rising. It depends on how quickly the banks get back to lending out that money because the velocity of money now is going to start increasing as the banks lend this money out. And we can expect that those long rates, which right now are being still managed by the Fed, will seek market levels. And that's going to be higher.

Forbes: What? 6%, 8% yields?

Lehmann: Not this year. No, I think you may see that next year. But I think it'll go up 1% or 2% this year. And I think that from there, it's anybody's guess.

Short Treasuries?

Forbes: And so, would you advise investors who have the stomach for it to short treasuries?

Lehmann: Well, that's difficult for most people to do. What I have been advising is for people to basically, between now and the end of June, get out of all of the fixed rate type of securities that they have, in terms of bonds, munis and such and go into things that are more tied to the stock market, because that's going to be able to adjust more rapidly. So, we've been saying buy blue chip high dividend stocks.

Forbes: Let's get into those. But I just want to hammer this home. If you have fixed income securities, now is the time to get out? I mean, fixed rate securities.

Lehmann: Yeah, especially junk bonds and such. Because it's that below-investment rate category that's going to get hit the hardest. It has come down to levels that we haven't seen in a long time, in terms of the spreads between treasuries and these junk bonds. And I think that once rates turn around, they're going to take the biggest adjustment.

Forbes: But even treasuries? If you have a ten-year, 30-yaer treasury, you'd say get out because you're going to take a principle loss, at least on paper?

Lehmann: I think that the capital loss is that you stand to have, in the next two years, way more than the interest you're going to be able to learn on those securities. So yes.

Forbes: Now, one of the things you seem to like is floating rate securities. How would an individual get into those?

Lehmann: There are any number of floating rate securities that are outside the bond market. Typically most of them are in the bond market but they're difficult to buy there. But there are a number of package products on the New York Stock Exchange, mostly issued by banks -- JP Morgan, Citibank, Goldman Sachs. $25 preferreds that really are backed by a bond that is tied to the CPI or to LIBOR, for the most part.

Heresy In Blue Chips

Forbes: And you also mentioned, stocks.

Lehmann: I know it's a heresy for me to talk about stock and buying stocks. But the Canadian energy stocks have always been favorites of ours because they are high dividend paying. But even blue chip securities like an AT&T pay 4% or 5% yield. As long as they're not paying out more than 75% of their cash flow and they have a good history of dividends, they're good options. Because they will adjust for inflation much more readily than fixed-income securities.

Forbes: What other names would you throw out? You mentioned AT&T.

Lehmann: AT&T. Pitney Bowes. There's a lot of funds also that we recommend -- closed end funds, that specialize in these kind of securities. For example, there are what we called buy-write funds, which are funds that hold a basket of blue chip securities and then they write call options against it. And from that, they can basically get an enhanced return so that some of these are paying 7%, 8%, 9% payout rates.

Forbes: In terms of those preferreds, say the name of your newsletter that you do with us so people will get into commercial here in terms of finding the name.

Lehmann: Forbes Lehmann Income Security Investor Newsletter.

Forbes: And in that you have these $25 preferreds with floating rates?

Lehmann: Yeah, we mention those. And we also run four model portfolios to give people a sampling of a starting point, if they want to follow our philosophy there. And in terms of low, medium and high risks, though, they can pick their category, as well as a blended one.

Muni Bonds

Forbes: Muni bonds. Individuals have been in panic over muni bonds. And you've warned and others have warned the spreads in those are huge and you can get really hosed going out. What do you advise people who may have accumulated large muni bond portfolios?

Lehmann: Well, there's a mixed purpose here. Most of the people, if they're extremely wealthy, their number one concern is just preserving what they have and not particularly concerned in maximizing their income and such. If they've got shorter maturities and such, they're okay. But we feel that the real risk is inflation with muni bonds, not this Meredith Whitney scare about hundreds of billions of dollars of defaults.

Because we always publish a newsletter on municipal defaults and such. And we've been tracking that since 1983. And I can tell you that defaults is not a big concern among municipal bonds historically or likely in the future. It's more the inflation that should be of concern to investors.

Forbes: Tell me about defaults. Even in this environment, I mean, housing was once at a pattern which was upended in the last decade. You don't see the same thing happening to muni bonds? What was in the past does not happen in the future?

Lehmann: There is a huge problem right now in what's called Florida Community Development Districts. There's several hundred of these in Florida that have issued bonds. And over 150 of them are in default on those bonds. These are housing projects for the most part got started in 2006, 2007. And by the time the infrastructure was put in place the market had collapsed. And there's about four billion dollars worth of these bonds out there. And many of these projects will never get built out.

This is not unlike a similar event back in the 1990s in California with the districts out there, what they call the Melrose bond. And there is going to be a problem with those because Florida's not growing the way it used to. It's not likely to turn around any time soon. So, this is probably a decade-long problem.

Forbes: On muni bonds, would you advise people to go into funds just to spread their bets or just get out of the market?

Lehmann: I had this discussion with somebody recently. And I said, even though the reality is that there's not a terrible default risk there in this kind of an industry, perception seems to be the predominant mood. And therefore, I think that even though the risks have been exaggerated, I think the perception will continue to have people selling. And so I don't think that they're a good thing to be in right now. Maybe when the inflation really kicks in and the prices have adjusted, you can get back in. But I wouldn't want to be there when you're going through that cycle.

Lehmann's Grenades

Forbes: You seem like such a calm man and, yet, you've been throwing out these grenades that Ben Bernanke has a secret program to reflate the capital of banks, that he wants a higher rate of inflation.

Lehmann: I guess I don't have a wide enough readership.

Forbes: But why would they think that, given the experience of the '70s, why would they think inflation is something that can be controlled, that it has political repercussions? You don't win many votes with inflation. The stock market, even though it can go up and down, in real terms goes down. We saw that in the '70s. How do they think they're going to come out politically on that? Or do they think it's like Nixon in '72? You can play games, win reelection and let the --

Lehmann: Well, because the people that are in control of that aspect of it aren't elected. Ben Bernanke, the Treasury Secretary, these are your two principal parties that can make this happen. They're above that. And they can create these cover stories and make you concerned about deflation in order to make you think that this massive amount of printing of money is, well, we got to stop the deflation threat.

And therefore, you can do this for quite a while before it gets out of hand. But if you think of it in terms that this is actually the intention of policy -- but you can never admit to that -- then it all makes perfectly good sense.

The Safest Oil

Forbes: Canadian royalty trusts, which you've been a fan of for a long time, you're still recommending them, even though the tax treatment's changed?

Lehmann: More than ever. Because the safest oil in the world is coming to us from Canada. And you don't have to put it on a tanker; it's a pipeline away. And it's been a good revenue source. There's also a dynamic to these Canadian trusts that is playing over the next few years. And that is a fact of the oil sands that are coming into play, where the principal cost of converting oil sands to oil is gas to heat it up.

And it's projected that before the end of the decade, Canada will not be exporting any more gas. They'll be consuming it 100% for oil sand conversion. Now, that's a great dynamic for most of these trusts, which are typically 50% oil and 50% gas, that as they develop oil sand resources, they'll be utilizing internally their cheapest product to create a much more valuable one. So, that creates value over and beyond having to buy additional reserves.

China's Gold Hoarding

Forbes: Another thing. You have an interesting theory, talking about throwing grenades out, about China and gold. Please explain.

Lehmann: Yeah. I had thought for many years that our relationship with China was they sent us goods and we sent them paper. That was the ideal situation for us. I mean, how can you lose? I mean, you keep sending them promissory notes and then you let the dollar erode and the value of what they're holding is deteriorating.

But it's gotten to such a level now that I'm concerned that basically China is probably already on a program to diversify the dollar into gold. I don't think they want any other fiat currencies or want to minimize that amount. But if they can establish a large gold reserve for themselves, they would be in a position of some day in the future, effectively saying, "We've decided to come to buy our last resort for gold. And today's price that we're willing to pay for it is $1,500 an ounce."

Dollars, not Renminbi. Which means they've, in one stroke, basically taken control of the gold market and tied the dollar to gold so that effectively, if every six months the dollar deteriorates 5%, they can just upgrade the stated price at which they wanted to buy gold at and thereby, upgrade and up-value their gold reserves but also keep the dollar in check.

Forbes: That's not like the Hunt brothers?

Lehmann: Well, the Hunt brothers basically didn't have deep enough pockets. The big difference here is that I think it was estimated that the total value of all the gold out there is something like five trillion dollars. And the Chinese are sitting there with over two trillion dollars in the dollar reserve. So, they obviously have a deep enough pocket to handle anything that anybody wants to throw at them.

And besides that, you know, if they did something like this, the world would embrace it. I mean, there are other central banks and certainly enough speculators out there who would love to have somebody to peg gold and put a floor under it, in effect.

So it's not inconceivable that this would happen. I think it's a little more than the Chinese, they're not sophisticated enough right now to try to pull off something like that. I think there are going to be unintended consequences. But I'm afraid most of them are going to be bad for us.

Forbes: Now what if Ben Bernanke decides to go back to academia -- which would be a great service to the world -- and somebody gets in who says "Sound dollar," and suddenly the gold market, as it did after Volcker and especially Reagan killed the inflation of the '70s -- gold price went down? What would the Chinese do then?

Lehmann: Well, as I say, if they've got a balance between, they've got a large gold holding now and a large dollar holding, what they're losing over here they're going to pick up on the other side. So for them the balance is still there.

Forbes: So, they can't corner the market, they're just ahead.

Lehmann: I don't think the intent would be to corner the market. The intent is basically to preserve the buying power of the two, three trillion dollars of reserves that they do have.

Forbes: So, would you buy gold now?

Lehmann: I've been buying gold since 1973. And I don't have any faith in any of the currencies because all the industrial countries have the same problems we have. And all the currencies are going to be fiat currencies. I think over the long haul, it's going to be a race to the bottom as to whose currency deteriorates the quickest.

Forbes: So, you don't see a sound dollar on the horizon?

Lehmann: No. it's just too costly. And the politicians are going to look for the easiest solution. And I think devaluing the dollar and inflation are two of those tools that you can implement without having to take responsibility for it.

Forbes: So, a fixed income guru says, "Sell fixed rate assets. Buy stocks with dividends that have a history of going up and not being overly paid out now, 70, 75% ratio. And buy Canadian royalty trust. And you'll do all right."

Lehmann: And at some point when the inflation's kicked in and you can lock in 8, 9% rates of return, do it.

Forbes: Thank you, Dick.

Lehmann: Thank you.

Lingenfelter

I think I want one
Lingenfelter Suburban
6000 lb, 600 HP, what not to like?

Safe as Houses

Economist lead on the topic, with embedded link to special report.

Real Estate is not a "perfect investment" matter of fact, it's pretty flawed as a household's prime investment.

Period

The perils of property: Home truths | The Economist

China ?

China's Secret Weakness - Forbes.com : drugs and gambling

On America:
The Weekend Interview with Paul Johnson: Why America Will Stay on Top - WSJ.com:


"'Of course I worry about America,' he says. 'The whole world depends on America ultimately, particularly Britain. And also, I love America—a marvelous country. But in a sense I don't worry about America because I think America has such huge strengths—particularly its freedom of thought and expression—that it's going to survive as a top nation for the foreseeable future. And therefore take care of the world.'"


Francis Fukuyama’s New History of Human Social Structures - NYTimes.com: 


"The Chinese political system, since it has no way of holding its rulers accountable, is in the long run unstable, in his view. “The Chinese have reasonably good technocratic leadership. They can move faster than a democracy and cut through interest groups. But that leaves them vulnerable to bad emperor problems. They think the last bad emperor they had was Mao,” he said."

Ageing in the rich world: The end of retirement | The Economist

Cleaning office (some) and found the following.
From a minor pension for the few that managed to get to old age, to an entitlement expected after a rather brief working career (say from 25 to 64) compared to ones youth and life expediency (into the 80's and lengthening)

Ageing in the rich world: The end of retirement | The Economist:

"Now retirement is for everyone, and often as long as whole lives once were. In some European countries the average retirement lasts more than a quarter of a century. In America the official pension age is 66, but the average American retires at 64 and can then expect to live for another 16 years. Average spending on public pensions across the OECD is now the equivalent of more than 7% of GDP (they cost America just 0.2% back in 1935). In some countries the current figure could double by 2050, to say nothing of the cost of private pensions and extra spending on health and long-term care."

More from Myles on whole animal

Trattoria Stella, a Traverse City Restaurant, Cooks in Whole-Animal Tradition - My North

Slow path to modern governments and economy

Democracy in South Africa: A step backwards | The Economist:

"Although they give nominal support to democracy, most Africans continue to hold a deferential view of political authority, according to a recent study of 19 democratic countries on the continent carried out by Robert Mattes of the University of Cape Town. South Africa scored particularly poorly on questions relating to accountability. Barely one in three citizens thought that MPs should hold the president to account. Fewer than 40% agreed that “the government is like an employee; the people should be the bosses”, most preferring the view that “people are like children; the government should take care of them like a parent”. Only 10% thought that voters should hold MPs to account, whereas as many as four out of ten believed that presidents should be able to “decide everything”."

Reflections on following the news

I guess it started early

I vaguely remember my mother following the Army McCarthy hearings - which would have been '54
Also, undated memories of going to the MSU Union with my father to watch coverage of news, likely Korea

But between '54 and '72 it was likely only the 15 min evening news - Huntley Brinkley and the like
When at Oberlin, I would drop by the campus radio station to read the newswires (either UPI or AP, I don't recall which)
Kennedy assination(s), but that was just a few days, protests of 68, again spotty

Then we had Watergate - and moved towards 24-7 coverage
CNN launches in '80, by then I was following FNN (morphed to CNBC)

Today we follow Cairo via FaceBook

Funny

Driving home yesterday, looking for tunes or talk radio
Judy Collins beautiful rendition

Songwriters: Sondheim, Stephen : A little Night Music

Isn't it rich?
Are we a pair?
Me here at last on the ground,
You in mid-air.
Send in the clowns.

Isn't it bliss?
Don't you approve?
One who keeps tearing around,
One who can't move.
Where are the clowns?
Send in the clowns.

Just when I'd stopped opening doors,
Finally knowing the one that I wanted was yours,
Making my entrance again with my usual flair,
Sure of my lines,
No one is there.

Don't you love farce?
My fault I fear.
I thought that you'd want what I want.
Sorry, my dear.
But where are the clowns?
Quick, send in the clowns.
Don't bother, they're here.

Isn't it rich?
Isn't it queer,
Losing my timing this late
In my career?
And where are the clowns?
There ought to be clowns.
Well, maybe next year.

Then picked up NPR's "Wait Wait Don't Tell Me" and mention of this

Infertility? Send In The Clowns!: 

"A small study, published in Fertility and Sterility on January 6, 2011, showed the advantages to laughter when in fertility treatment. What will they think of next? The study, comprised of 219 women, set up for women to be entertained by a professional “medical clown” right after transfer. The success rate was 36% versus %20 who went without the clown.

'Dr. Shevach Friedler, who led the work, said he got the idea for the study after reading about the potential physiological effects of laughter as a 'natural anti-stress mechanism.'"

Whoops

Combine snow, a small birch (tagged to be removed) and a bit to much "oomph" to get through a drift and we have

A lighter wallet

Change of pace

Meet Apple's New Boss, The Most Powerful Gay Man in Silicon Valley

Tim Cook

and will this sell a few million more iPads?

Playboy Promises To End iPad's 'Freedom from Porn'

Unions so 20th Century?

Bargaining for employment: Union power and the jobless recovery | The Economist:

"...labor-industrial complexes of the postwar era were mostly cosy oligopolies; there was a lot of value for labor to extract because they didn't have to worry so much about losing their customers. Those cosy oligopolies had cosy relationships with bankers, who lent them money to keep overstaffed in downturns without much thought of how the depositors would feel, and the depositors didn't care because their heavily regulated accounts paid exactly the same interest rates as every other bank, and were federally insured."

Takes two to Tango

Good or bad, this is the Sino-American Century

FT.com / Comment - East and west are in it together:

"Both China and the west have much to be proud about. Yet this does not mean that everything has gone smoothly. On the contrary, both sides have made mistakes in managing their economic interaction."

Please respect FT.com's ts&cs and copyright policy which allow you to: share links; copy content for personal use; & redistribute limited extracts. Email ftsales.support@ft.com to buy additional rights or use this link to reference the article - http://www.ft.com/cms/s/0/45c703f4-233c-11e0-b6a3-00144feab49a.html#ixzz1BRI7knEq

China, for example, allowed an extraordinary surge in exports and the current account surplus to mask the development of an increasingly unbalanced domestic economy. Chinese household consumption collapsed from an already very low share of 46 per cent of gross domestic product in 2000 to a mere 35 per cent in 2008.

Partly as a result of its decision to keep the exchange rate down, China emerged as the world’s largest surplus country, with a current account surplus peaking at 11 per cent of GDP and foreign currency reserves of about 50 per cent of GDP. These were foolish investments, made as a result of foolish policies. It is absurd for China’s leaders to complain about China’s consequent (and entirely unnecessary) vulnerability to US fiscal and monetary policies.

Meanwhile, the US and a number of other western countries allowed the supply of cheap foreign savings, partly from China, to encourage a huge surge in household debt, private consumption, residential construction and financial sector leverage. While the excess savings of the emerging world were not the principal cause of the financial crisis, they were a contributory factor.

Which will it be?

Cost of Capital

Will it be

McKinsey & Company - Report : Farewell to cheap capital? The implications of long-term shifts in global investment and saving

or

FT.com / Comment / Op-Ed Columnists - Why we have to live with low interest rates

Markets are conversations - cluetrain maifesto

How to drive a successful social media campaign | VentureBeat:

"The steps:

Focus: Hand pick small audiences that will have a positive emotional reaction to the campaign you’re pushing.

Grab attention: The more you remove barriers for the audience to help you, the better your chances. Breaking those down, in fact, is possibly more important than encouraging action on their behalf.

Engagement: Humans aren’t set up to understand logic. They’re set up to understand stories. Want to hook an audience? Talk to it, not at it."

50 years ago this week

The Ask Not What Your Country Can Do For You speech by John F. Kennedy:

"And so, my fellow Americans: ask not what your country can do for you - ask what you can do for your country.

My fellow citizens of the world: ask not what America will do for you, but what together we can do for the freedom of man.

Finally, whether you are citizens of America or citizens of the world, ask of us the same high standards of strength and sacrifice which we ask of you."

Maybe not all apply, but some do

11 Tricks to Cutting Travel Costs in 2011 - NYTimes.com

Public Employees Unions

Franklin Roosevelt questioned public employee unions, voicing the opinion that they had a special relationship with the government and the public.

McGurn: Labor's Coming Class War - WSJ.com: "Labor's Coming Class War

Private-sector union workers begin to notice that their job prospects are at risk from public-employee union contracts."

States Seek Laws to Curb Power of Unions - NYTimes.com:

"State officials from both parties are wrestling with ways to curb the salaries and pensions of government employees, which typically make up a significant percentage of state budgets. On Wednesday, for example, New York’s new Democratic governor, Andrew M. Cuomo, is expected to call for a one-year salary freeze for state workers, a move that would save $200 million to $400 million and challenge labor’s traditional clout in Albany.

But in some cases — mostly in states with Republican governors and Republican statehouse majorities — officials are seeking more far-reaching, structural changes that would weaken the bargaining power and political influence of unions, including private sector ones."

And it's not just in America

The public sector unions: The battle ahead | The Economist: (link to leader with links to articles)

"Look around the world and the forces are massing. On one side are Californian prison guards, British policemen, French railworkers, Greek civil servants, and teachers just about everywhere. On the other stand the cash-strapped governments of the rich world. Even the mere mention of cuts has brought public-sector workers onto the streets across Europe. When those plans are put into action, expect much worse."

some done, many not yet

Why 41?

Beats me

The 41 Places to Go in 2011 - NYTimes.com

Does/Will the Euro ever work

NYTimes Sunday Mag cover story

The Road to Economic Crisis Is Paved With Euros - NYTimes.com

Deeper than most

More thinking here

The euro area: Time for Plan B | The Economist

I've been a skeptic for some time

Some history

European Coal and Steel Community - Wikipedia, the free encyclopedia

I can recall going to a lecture by Jean Monnet at Fairchild Auditorium at Michigan State sometime back in the mid 60's.

The key was that it was formed to prevent any future wars between France and Germany

In Vino Veratas

Doubt on Anti-Aging Molecule as Resveratrol Trial Is Halted - NYTimes.com:

"The pharmaceutical company Sirtris announced last month that it had halted the last of its clinical trials of resveratrol, the minor ingredient of red wine that some researchers see as a drug that can extend life.

The decision signifies an apparent divergence of views on the merits of resveratrol between the current head of the company, which was bought by GlaxoSmithKline in 2008 for $720 million, and its founders.

But mankind has been chasing this for many years

Armenian Winery Is Oldest Found to Date - WSJ.com:

"Scientists have discovered the world's oldest known winery, secreted amid dozens of prehistoric graves in a cavern in Armenia, an international research team said Tuesday.

Outside a mountain village still known for its wine-making skill, archaeologists unearthed a large vat set in a platform for treading grapes, along with the well-preserved remains of crushed grapes, seeds and vine leaves, dating to about 6,100 years ago—a thousand years older than other comparable finds."

Michael Aronstein on Green Swans

Oct 14, 2010

Good insight

Michael Aronstein, President, Marketfield Asset Management | Analyst Wire | Find Articles at BNET:

"The fundamentals of the capital markets, if you look at liquidity and the posture of the participants, are much, much better now than people are judging if they come at it from one of the fundamentals of the economy and how will that affect the capital markets."

it's so warm it's cold

Warmer water, more precipitation, more snow, colder air

Bundle Up, It’s Global Warming - NYTimes.com:

"...the overall warming of the atmosphere is actually creating cold-weather extremes. Last winter, too, was exceptionally snowy and cold across the Eastern United States and Eurasia, as were seven of the previous nine winters.

For a more detailed explanation, we must turn our attention to the snow in Siberia."

Kenneth G. Lieberthal - Brookings Institution

Excellent source on China

Kenneth G. Lieberthal - Brookings Institution

The 60's

For now, a placeholder for some posts on 67-68

Such as

German history and the Stasi: The gunshot that hoaxed a generation | The Economist

Violence in Europe and America

I was in Detroit shortly after the German incident

July 23rd and for about a week afterwards

The "12th Street" Riot, the beginning of the end for Detroit as a city

'68 and the student unrest in France, the Police Riot in Chicago

The end of the Kennedy-Johnson Administration, the beginning of the end of Viet Nam (Tet), end of Civil Rights movement as a multi-racial affair (beginning of the Black Power movement)

more links here

Prospects

What does the global situation look like

Buttonwood: In a spin | The Economist:

"Indeed, for all the efforts of governments and central banks, many of the global economy’s long-term problems have yet to be solved. The banks are weak, the American housing market is still in the doldrums and the global imbalances have not gone away."

Conclusion - rates, in the US, will stay low

File under "duh"

Back to the last PCForum, 2006

Conversation with guy from Cargill re: bio-fuels and the like

Opinion was that the VC's were full of themselves, didn't have a clue about biochemistry and fuels.

"As if Cargill hasn't investigated all of this?"

Layer on the capital demands and you are ripe for failure.

IT/IP calls for minimal capital in comparison.

What does Kleiner’s drift from cleantech mean for green investing? | VentureBeat:

"It appears that titan venture capital firm Kleiner Perkins is moving away from cleantech and going back to its roots in Internet investing, where it made famously good bets on companies like Amazon and Google."

and

It's about Capital Intensity - VC is about low intensity, not high

Score one for big energy

Cleantech VCs are thinking small | VentureBeat:

"Cleantech has been the industry of big-money investments in ambitious projects, but that may be changing, judging from a venture capital panel at VentureBeat’s GreenBeat conference today.

The most emphatic speaker on this point was Navin Chaddha, a partner at the Mayfield Fund. Chaddha said he’s more interested in investing “downstream” from energy generation, rather than in generation itself. That’s where entrepreneurs will find more opportunities, and those companies require less funding. As positive examples, Chaddha pointed to SolarCity (one of his portfolio companies) and SunRun, which aren’t trying to build giant solar plants or factories, and are instead trying to change the solar distribution model by bringing it directly to consumers.

On the flip side, he pointed to solar panel maker Solyndra, which has reportedly raised more than $1 billion but just announced that it’s closing one of its factories. $1 billion is more than most individual venture funds, Chaddha noted, and spending that much money on a single company is the “antithesis” of what venture capital is about."

Nope

Note that I have only traded gold on the short side.

Despite problems with the current system, a gold backed system ensures poverty and low growth.

Could the world go back to the gold standard? | martin wolf's exchange | Economic commentary from the Financial Times – FT.com:

"In short, we cannot and will not go back to the gold standard. As L.P. Hartley wrote, “The past is a foreign country: they do things differently there.” We cannot live in the 19th century. It is foolish to pretend that we can."

Study Business, not Economics

Schumpeter: Why do firms exist? | The Economist

Coarse : His central insight was that firms exist because going to the market all the time can impose heavy transaction costs. You need to hire workers, negotiate prices and enforce contracts, to name but three time-consuming activities. A firm is essentially a device for creating long-term contracts when short-term contracts are too bothersome. But if markets are so inefficient, why don’t firms go on getting bigger for ever? Mr Coase also pointed out that these little planned societies impose transaction costs of their own, which tend to rise as they grow bigger. The proper balance between hierarchies and markets is constantly recalibrated by the forces of competition: entrepreneurs may choose to lower transaction costs by forming firms but giant firms eventually become sluggish and uncompetitive.

Hah

In my spam box today

Now if I wanted to tout it ...

But does not apply

message :

Jt Hoagland has been selected as the 2010 Best of Lansing Award winner in the Investment Advisory Service category by the US Commerce Association. We have tried to contact your business throughout the year but have not received any response. With this final notice you still have a chance to order an award for 2010.

The USCA identifies companies that excel in their business category and successfully market their business to the public and the local community. Each year, the "Best of Local Business" Award Program offers recognition to local businesses throughout the country based on the results.

Great Minds

Think alike - understanding

Questions for Brian Greene - NYTimes.com:

"How would you define intelligence?"

Intelligence is the ability to take in information from the world and to find patterns in that information that allow you to organize your perceptions and understand the external world."

Brian Green?:

This interview is for our annual Ideas Issue, and because you’re a physicist at Columbia University who specializes in string theory and the secret life of invisible particles, let mestart by asking you this: Do you think the fieldof physics is continuing to provide the world with big, important, Einstein-level ideas?
Absolutely. Physics grapples with the largest questions the universe presents. Wheredid the totality of reality come from? Did time have a beginning?

yet more on China

Chinese business: Where are the profits? | The Economist:

"Chinese stocks are cheap because the market has spotted some serious underlying problems. Here’s one: as revenues soar, profit margins are falling (see chart). Sales rose by a staggering 42% year-on-year in the first half of 2010. That was partly because the first half of 2009 was dreadful, but sales will still rise by an impressive 23% in the second half of 2010, predicts Macquarie Securities, a broker. Yet margins have been on a protracted slide that shows no sign of stabilising, says Michael Kurtz, Macquarie’s Asia strategist. Normally they rise by 1.5% in the first half of the year because of seasonal factors, but that did not happen in 2010.."

The government wants to allow ordinary people to enjoy more of the fruits of growth. Happy citizens are less likely to riot or demand the right to vote, it assumes. How far it will go remains to be seen, however. Will it allow the (artificially low) interest rates that banks pay depositors to rise? That would reduce the transfer of wealth from savers to well-connected corporations, which enjoy cheap credit. Will it allow the yuan to appreciate, thus walloping exporters but boosting consumers’ spending power? As usual in China, no one knows

More on Asia

Growth - yes

Risk - yes, and has most of the prospective growth already been priced in?

The End of the Asian Bull Market

Over the next five or even ten years, investors relying on emerging economies will not be as fortunate, however, according to Louis-Vincent Gave, CEO of the Hong Kong-based research and investment management firm GaveKal.

Asian economies will grow faster than those in the developed world, Gave predicted, but that won’t be enough to compensate for high current valuations and excessive liquidity. Indeed, Asian debt and US equities offer far better investment opportunities, he said.

“The situation in Asia is 180 degrees from where it was five or six years ago,” Gave lamented, referring to the paucity of attractively priced stocks. He has lived in Asia for most of the last 20 years while investing in the Asian markets,