My second letter to WKZO-AM590

When our local radio station changed its programming last July to include Glenn Beck in the afternoon, I wrote a letter to the program director, Jay.  I decided to write a follow up letter today.  Feel free to do likewise:  jay@wkzo.com

Dear Jay, 

I respectfully request that you cancel the syndication of Glenn Beck.  It was fun for a while but come on, enough is enough.  In a recent TV appearance will Bill O'Reilly, Beck said, "I'm full -- I'm full-fledged crazy nuts. You know it, and I know it. So here it is. This is what's coming, America. Depression and revolution. That's what's coming...  Well, wait a minute. Is that a problem? Is it a problem to point out -- wait a minute, is it a problem to point out Bill O'Reilly -- is it a problem. You get no food from me. You come knocking at my bomb shelter? I'm going to say, "Is that Bill O'Reilly? Can't hear you." "

 And I'm sure his drivel on the radio is similar.

I'm not arguing against his right to say whatever he wants, and I'm not saying that he's trying to incite anything, my argument is more fundamental: he's a knob.

I realize that WKZO's ratings mean something, but get real.  Have you sold your soul?

Tony Xxxxxxx

Kalamazoo

PS: Where's Dave Jaconette?  I miss him.

Financials, if you must be long: WFC vs BBT

Anybody going long into financials must have gonads the size of Cleveland, but the case could be made that Friday was a wash-out day of sorts and the sector is oversold.  Keeping with the "irons in the fire" theme, maybe nibbling at a bank or two is in order.

XLF is an unmitigated disaster with unrelenting selling.  The anti-Democrats will say that it's because of the lack of a Geithner plan, or the liberal use of the 'N' word (nationalization), or the populist angst verbalized by the Derivitive Trader to the Stars, Rick Santelli.  Or, more sane people would postulate, it may be because these companies have NO EARNINGS and have LOADS OF WORTHLESS ASSETS, but I digress...  

XLF is oversold on a technical basis.  Spike lower on high volume. Full stop.  So if we want to take advantage of a counter-trend rally, how do we do it?

WFC shows a similar pattern on the daily chart.  Spike lower, high volume, wash-out/ capitulation pattern.  But this is a toxic bank with lots of bad stuff going on.  Can it be trusted on the long side??

BBT by some accounts has better fundamentals with less bad debt and more solid assets.  It may be the best house in a bad neighborhood... which could mean it's a safe place to live, or it could mean that the natives will torch it next.  The "outside"reversal pattern is statistically more bullish, but ONLY if it confirms with an up-move the day after.  Big decision.

WFC on the hourly shows some good upside volume at the end of Friday... and I even jumped on for an hour and a buck.  But this still has a lot of bearish resistance to break through.  Eric likes this stock, but I don't trust it.

BBT on the hourly chart looks healthier.  It has already broken through it's bearish trendline and is poking it's nose at the horizontal resistance.  If it breaks through, we could ride it for a few bucks.  Sell stop would be Friday's intraday low of $13.20... if you're brave.  Strong futures and I may get in pre-market.

It takes some major league intestinal fortitude to think about going long banks, but maybe this falling knife can be caught.

WFC: Anatomy of a day-trade

It's not often that my patience pays off so well, but Friday I was watching this oversold mess of a market all day and specifically watching financials.  Eric has always been a fan of WFC, so what the heck...

WFC long at $9.50 bought at 1415hrs and held for an hour.  Sold for a buck profit.  There were other banks that would have worked nearly as well, such as BBT or ASBC, etc.  This seemed like a low risk entry and my only hesitation was that it was Friday and options expiry when strange things happen.

I'm not too keen on WFC medium or long term, but Friday looked like a mini-washout day.  This could fly from here, but I would not be long any banks without upside confirmation on Monday AM, and I would mitigate any risk by trading only fundamentally sound financials like BBT or MS or GS.

Helping homeowners the least we can do

The "rant of the year" occurred yesterday and having seen it live, I wasn't that impressed.  Sure, I commiserate with him on the idea of bailing out homeowners who bought too much house. Why should anyone get government help for irresponsibile behavior?

We live in a different world today than we did 18 months ago.  Some of us may have realized that gobs of debt may not be beneficial to long term survival, but obviously the entire banking/ mortgage system did not agree.  The financial industry got a $700 billion bailout last fall in order to correct their over-levered existence, and now the over-levered homeowner will get a similar deal.

At least Santelli is consistent since he railed against the bank bailout last September with admirable aplumb.  I love his passion, but the problem with Santelli's hard line is that the status quo of massive delevering tends to hurt all the players in the economy without regard for fault and we live in a highly integrated society.  Bad decisions by bankers and regulators have led to bad outcomes for us all.

All these bailouts really do is provide a structure for a slow motion delevering process.  The bad banks like Citi and Bank of America are going out of business regardless, but the organized process has led to no massive run on the bank and the money markets were spared from breaking the buck last September.  The innocent bystander institutions like Morgan Stanley and Goldman and a host of regional banks who were not levered 30:1 will remain in business and will benefit in the long run through reduced competition.  These are not necessarily bad outcomes given the circumstances.

Now, we can see that certain homeowners are having trouble making their mortgage payments and much of this is through no fault of their own.  In recessions people lose their jobs or have their hours cut and mortgages can become onerous very quickly.  The guy working as the cook at the local restaurant may have his hours cut with a fall off in business or his wife may get laid off from the hair salon when customers eschew once monthly haircuts.  This economic downturn certainly was less the fault of these folks than Bank of America's CEO with his several million dollar bonus.  

I have little problem providing a mortgage assistance for families that are getting inundated during this hard time.  It's not about people like me, but it certainly could have been had I not been fortunate enough to come of age in the fat part of the business cycle.  My house may be paid off and I may have no debt, but that wasn't the case 20 years ago when I was in my 20's.  I sure would not want to be in that position in today's crappy job market.  

Obama's plan makes sense:

This program is only for "at-risk" borrowers who are struggling with mortgage payments above 38 percent of their income. Under the program, if the lender agrees to lower the interest rate or reduce principal to bring the payment to 38 percent of the borrower's income, the government will pay half of the additional cost to the lender to reduce the payment to 31 percent of the borrower's income.

Furthermore, the property must be an owner-occupied primary residence without a second mortgage or jumbo loan. The lender has to have skin in the game so the risk to the government is mitigated.

How many people this will help is unclear, but estimates are about 9 million.  Obviously provision is made not to reward speculators.  The alternative to such a plan would be to have families having to foreclose or sell their homes into the worst housing market in history because of a short term economic recession, which would be a shame since this could trigger an acceleration of the downward cycle in the housing market and the delay any recovery in the economy.

Is it fair?  Hell, no it's not fair.  But neither are the rich salaries of bank and mortgage executives or the lack of remorse from government officials and regulators who perpetrated the biggest Ponzi scheme in history.  Nothing about this is fair, but it's the least we can do for our fellow citizens and for ourselves to protect the value of our greatest houshold asset-- our houses.  And the cost would be minimal compared to the bank bailout.

So while I understand Santelli's angst and I recognize that it's consistent, I politely disagree with his outdated Ayn Rand worldview.  I joked earlier that mortgagees who get help from the government should be required to clean up the neighborhood in return for the largesse, and the irony is that my underemployed neighbor would likely agree wholeheartedly without even asking...  

Would Angelo Mozillo? 

Iran, Nukes and Israel

Let the record show that less than 500 hrs since George W. Bush left office, the UN has announced that Iran is effectually the next nuclear power.  Another success of the Bush Doctrine.  Israel, your move?

Modest Proposal on housing fix

The question is what to do with mortgage holders who cannot make their payments has come up and the current proposal is to lower the principle on those loans.  Those who are not behind on their payments are not eligible for principle reduction.  Is this fair?

No, but supposedly if these houses go into foreclosure, then all the houses in the neighborhood will lose value.  I get the reason, but it's little compensation for paying my taxes, paying my mortgage and then also subsidizing my neighbor just because he lied about his income and got a house he cannot afford.

So here is my fix.  Anyone who recieves government aid for their outstanding mortgage gets a big RED sign placed on their front lawn.  That person is required to keep that sign until he pays off the mortgage in full.  During the time the sign is in place, he is responsible to 1) mow the lawns for his neighbors on either side, 2) take in the garbage cans every week, 3) sweep the street for litter at least monthly and 4) make sure all public sidewalks are clear of snow and ice in the winter.

For his mortgage to be subsidized, that's the least he can do for his taxpaying neighbors. 

When economic pessimism has gone too far...

Tech Ticker:

Americans' Standard of Living Permanently Changed.

Business Week headline:

Sometimes, having too much money can be a problem.

Okay, enough is enough.  This might be a contrarian sentiment indicator, folks.

Let's run a diagnostic...

"I'll be honest with ya buddy, right now this country is running on hope."

Running on Hope from Douglas Sarine on Vimeo.

(h/t BR)

Bristol Palin for SCOTUS?

In perhaps the most lucid display from any Alaskan to date (which isn't saying much), Bristol Palin's recent interview has shown that she either disagrees with the Republican party platform or has not read it.

Fox News host Greta Van Susteren received answers that would not have flown at any GOP meeting and emphasizes how out-of touch Bristol's mother is on issues of civil liberties and common sense.

Bristol stated uncategorically that while abstinence among teens is a desired goal, it is simply "not realistic" implying that the official policy of Anchorage schools and that of the GOP platform to eschew sex education is flawed.

She also uttered that archaic word among Republicans: "choice", as in "keeping the baby was my choice, not my mother's."    Now, if Bristol had said something to the effect of "you know, there really is no other choice for a pregnant woman but to have the baby" I would understand, but she didn't say that.  Bristol clearly said that it was her "choice" and she did so in decrying the media's "evil" reports that her mother was "making her" keep the baby.  So, apparently her mother Sarah should have jurisdiction over everyone else's body but not her own daughter's.

I wonder if this interview will be resurrected during Sarah Palin's 2012 Presidential campaign?

I get email...

You'd think that given all the damage we're enduring due to the complete mismanagement of our federal government these past 8 years that my email box would reamain untouched by Bush-bots.  But no, I still get email from folks apparently trying to continue the dialogue, and while I usually delete them, occasionally my better judgement fails and I send off a response.  When it's just harmless nonsense like Obama being a Muslim or mindless zaniness about someone praying Jesus finds them a job, I can almost always resist replying, but I had to respond to the latest... and I admit that maybe I overdid it.

The email was a cryptic reference to this CNBC article that basically says that in the grand scheme this current recession is no worse than the 1970's and 1980's and that President Obama has worsened the recovery by referring to the impending "catastrophe" if the the stimulus bill doesn't pass.   

OK.  Here's my overreaction:

I understand this meme going through the conservative media--  and correct me if I'm off base on this-- that Obama's speech saying that we are close to an impending "catastrophe" are counter-productive and this is just your garden variety rescession and we should all heed Sen Gramm's admonition and stop our "whining."  

The problem with this meme is that the only reason Obama was lowered to sensationalism is that the Republicans in the House and  Senate decided to play political football with the stimulus package and paint the plan as old school liberal spending.   In the interest of getting bipartisan support for the bill, Obama came out with a castigation and emphasized the importance of quick passage, and the Republicans, who BTW lost both houses of Congress and the White House due to the public's repudiation of their insanity, balked and instead made this a political issue.  Personally, I think the Democrats should just ignore the lunatic fringe like Shelby and Boehner and pass legislation along party lines, but that's me.  These same Republicans had no compulsion about passing war supplemental after war supplemental for an illegal, ill-advised multi-trillion dollar war, but now they have found this weird self-righteous fiscal responsibility in the teeth of a worldwide depression.

Bush in September was quoted as saying , "If the credit isn't loosened up, this sucker could go down." This sucker could go down???!!!  Where was the Cato Institute decrying that sensationalism, and why didn't K----y send out a feverish email at that time?  My email box was empty save for the requisite missive by my liberal friends who questioned the motives of Messrs Bush and Paulson as they allegedly raided the Treasury for their pals on Wall Street.  In September, Paulson got down on one knee to beg Nancy Pelosi not to block the bailout bill.  Why?  Why did Paulson feel compelled to literally beg the Democrats to do the right thing?  The answer is because the Republican Robots in Congress refused to listen to the argument about money markets breaking the buck and the need for urgent immediate action.  If we are to believe the sensationalism of Bush and Paulson, then the Democrats single-handedly rescued the money markets in September.  Thank you Mr. Boehner, Mr. Shelby and Cato Institute. NOT.

And this is exactly the same reason Obama felt compelled to pedal gloom and doom recently: to try to get the Republicans on board in a bipartisan bill to stimulate the economy.  Would they do the right thing?  You tell me.

As long as we're sending along references, Shadowstats follows the Unemployment and GDP numbers and figures them the way the BLS numbers were figured in the past before we left out part-time workers and jobseekers out of work for more than a year.  Using these numbers, the unemployment is already in double digits and the GDP growth is much worse than the BLS currently reports.  So is this recession as bad as others?  The answer, according to these metrics, is a resounding "yes."  The precipitous fall off in jobs the last three months is particularly worrying, and the worldwide decline in industrial production puts a much dire hue to this recession versus the 1970's and 1980's.

Now we have to endure this drivel that Obama talking down the economy is the "real" problem.  Save it, dudes.  Quite frankly, I'm in a new paradigm where I refuse to listen to anybody imbecilic to have voted for Bush at all.  With experience, I'm sure Obama will learn to do the same in the future.  And while I may have some issues with President Obama, let's get real here: the economy is in free fall and the only complaint we can dredge up is that Obama said "catastrophe'?  Please.

Consider this email a gift of enlightenment from an unlikely source.  And if you think the economy just needs a pep talk, then good luck with that.

Tony

More random thoughts: banks, boondoggles and babies

1.  Ritholtz points out that the sell-off last week had nothing to do with the lack of details to the Treasury bailout and the inadequacy of Geithner's speech.  The sell-off began 21 seconds into his speech with a precipitous drop which is very consistent with your garden variety "sell-on-the news" trade.  We're in a bear market folks... don't forget it.

2. While the Republicans bemoan the wasteful government expenditures requisite in the passage of Obama's "big package", let's not forget the ongoing $2 billion per week boondoggle that we can call Bush's "big package."  How many of these newly converted fiscally responsible Republicans voted against the war supplemetal funding bills?

3.  This math whiz found the flaw in the current Stimulus Bill.  Since we will continue to lose jobs at 600K per month though June, then how can the 3.5 million jobs created or saved by the bill be helpful?  Since it will take 18-24 months for full effect, the bill is called "stillborn."  I guess the answer is that since it won't work fast enough, let's not do anything.  Good call, Mr. "light and the end of the tunnel" Hoover.

4.  The bright side of the economic downturn: lawyers and investment bankers working at McDonald's.  This could mark the beginning of an overdue era of massive re-allocation of our precious human capital into productive jobs.  We need more brain-power trying to figure out how 9 billion people can live in peace on our damaged planet and less brain-power inventing new financial techniques designed to steal hard-earned capital from people who work for a living.

5.  The Republican party has quickly become a circus side-show, and George W. Bush was merely the clown act ushering in the current encore of idiocy.  As this former Republican has succinctly summarized, President Obama was correct to make initial overtures, but no more effort toward bipartisanship is warranted.  Ignore the Republicans and feel free to legislate without their counsel or support.  We need a loyal opposition to the current administration, but it needs to be a phoenix that arises out of the ashes and there is no point in trying to breathe life into the failed and (finally) euthanized GOP.

6.  Nationalize the failing banks... yesterday.  Folks as diverse as Nouriel Roubini, Paul Krugman and Upsidetrader have all come together.  Get it done: Citi and Bank of America stocks go to zero, write down their assets, bank depositors are saved, debts are assumed by the feds, we all move on.

7. The octuplet mom is crazy and needs help and was physically and financially abused by her infertility doctor.  The infertility specialist's horrendous judgement just proves that the industry needs to be regulated: if society has to pay for the kids (which we will no matter how outraged we all want to get), then we also have a say in who uses the technology and the doctor obviously is not equipped to make the decision.  The asshat "libertarian" Sean Hannity gets it all fucked up, but what else is new.  This case is hardly an indictment of the entire welfare system for the indigent, this case represents the 3rd standard deviation of welfare recipients and of course it's the one case the media present.

Smoke-free dining in Kalamazoo

Here is a list of restaurants in Kalamazoo that prohibit smoking for patrons (copied below).  This is an excellent resource for those of us who do not like to dine in an atmosphere polluted with cigarette smoke.  On quick perusal I notice that this list is incomplete;  in addition to the ones below, O'Duffy's on Vine Street has always been smoke-free.  [As an aside, I have always been opposed to laws limiting business owners rights to operate establishments that allow smoking-- or any other activity between adults for that matter.]

Angelo's Italian Eatery	5401 Portage Road , Portage
Asiago's Bakery & Deli	6997 W Q Avenue , Texas Corners
B'Wiched Deli	5051 W. Main St, Kalamazoo
Barnes & Noble Café	6134 South Westnedge Avenue , Portage
Beaner's Coffee	5913 Gull Road , Comstock Twp
Bella Creamery	10098 Shaver Road , Portage
Big Apple Bagels	3205 S Westnedge Ave, Portage
Big Apple Bagels	3838 W Centre Street , Portage
Big Apple Bagels	4408 W Main Street , Kalamazoo
Big Joe's Pizza & Deli	1524 Gull Road , Kalamazoo
Bravo!	5402 Portage Road , Portage
Burger King	5798 Gull Road , Comstock Twp
Charlie Foster's	Water Street, Kalamazoo
Cheesesteak Grill, Inc.	233 W Centre Avenue , Portage
Cold Stone Creamery	4540 W Main Street , Kalamazoo
Colonial Kitchen	330 N Drake, Kalamazoo
Cool Beans	6541 Stadium Drive , Oshtemo
Cornerview Café	643 N Riverview Drive , Parchment
Cosmo's Cucina and O'Duffy's Pub	804 W Vine Street , Kalamazoo
Cottage Inn Pizza	5038 W KL Ave , Kalamazoo
Crow's Nest	816 South Westnedge Avenue , Kalamazoo
Culver's of Portage	7262 S Westnedge Avenue , Portage
Dogs With Style	410 S Burdick Street , Kalamazoo
Domino's Pizza	2001 W Main Street , Kalamazoo
Domino's Pizza	1788 W Milham , Portage
Duda's Deli & Pizzeria	113 W. Michigan Avenue , Kalamazoo
Ecumenical Center	702 N Burdick Street , Kalamazoo
Erbelli's Pizza & Italian Cusine	8342 Portage Road , Portage
Erbelli's Pizza & Italian Cusine	6214 Stadium Drive, Kalamazoo
Evergreen Grille -Yarrow Inc.	10449 N 48th Street , Hickory Corners
Franco's Substation-Pizzeria	8016 South Westnedge , Portage
Full City Café	7878 Oakland Drive , Portage
Full City Café	2026 Parkview Drive , Kalamazoo
G & L Restaurant	2628 W. Michigan Ave, Kalamazoo
Good to Go Cafe	120 E Prairie St. Vicksburg
Hope Woods Dining	5749 Stadium Drive , Oshtemo
Hunan Gardens	5059 W. Main, Kalamazoo
Icehouse Bar & Grille	3600 Vanrick Drive , Kalamazoo
Kellogg Biological Station	3700 E Gull Lake Drive , Hickory Corners
Little Caesar's Pizza	3814 West Centre Street , Portage
Little Caesar's Pizza	911 East Cork Lane , Kalamazoo
Little Caesar's Pizza	5460 East Gull Road , Comstock Twp
Little Caesar's Pizza	3500 East Main Street , Kalamazoo
Little Caesar's Pizza	4250 West Main Street , Kalamazoo
Little Caesar's Pizza	507 North Park Street , Kalamazoo
Little Caesar's Pizza	930 Portage Street , Kalamazoo
Little Caesar's Pizza	13218 North US 131 , Schoolcraft
Little Caesar's Pizza	6011 South Westnedge Avenue , Portage
Lunchtime Café	5067 Gull Road , Comstock Twp
Mancino's Pizza & Grindres	10100 Shaver Road , Portage
Nina's Café	1710 W Main Street , Kalamazoo
Nisker's	6384 South Westnedge Avenue , Portage
Oakwood Bistro	3003 Oakland Drive , Kalamazoo
Old Burdick's, Radisson Plaza Hotel	100 W. Michigan Ave, Kalamazoo
Old Burdick's West	2747 S 11th St., Osthemo
Olga's Kitchen	6650 South Westnedge Avenue, Portage
Panda Express	2706 W. Michigan Ave, Kalamazoo
Panera Bread	5119 W Main Street , Kalamazoo
Panera Bread	5970 S Westnedge Ave , Portage
Pasta Pasta	762 W Main Street , Kalamazoo
Piper's	45 W Michigan Ave , Galesburg
Pizza Hut	2042 W Centre Ave , Portage
Pizza Hut	5462 Gull Road , Comstock Twp
Pizza Hut	6050 Gull Road , Comstock Twp
Pizza Hut	1908 W Main Street , Kalamazoo
Pizza Hut	6840 W Main Street , Kalamazoo
Pizza Hut	6300 S Westnedge Ave , Portage
Pizza Hut	4438 S Westnedge Ave , Kalamazoo
Pizza Maters	2937 Howard, Kalamazoo
Plumcrazzy Ice Cream Parlor	3710 S Westnedge Ave., Kalamazoo
Portage Senior Center	320 Library Lane , Portage
Pretty Lake Vacation Camp	9123 West Q Avenue , Texas Twp
Qdoba Mexican Grill	5901 Gull Road , Comstock Twp
Qdoba Mexican Grill	4403 West Main Street , Kalamazoo
Qdoba Mexican Grill	6800 South Westnedge Avenue , Portage
Rasa Ria	1908 W Main Street , Kalamazoo
Red Robin	5710 S Westnedge Ave , Portage
Richland Sajos Pizza	9800 M-89 , Richland
Rykse's Restaurant	5924 W Stadium Drive , Oshtemo
Saffron Indian Cuisine	1710 W Main, Suite D street, Kalamazoo
Samuel Mancino's Italian Eatery	5363 S Westnedge Ave, Portage
Schnauzer's Banquet Hall	4261 West U Avenue, Schoolcraft
Scooters Malt Shoppe & Travelling Treats	8399 S 36th Street, Climax
Shawarma King	2925 S Westnedge Ave, Kalamazoo
Sol World Cafe, Radisson Plaza Hotel	100 W. Michigan Ave, Kalamazoo
Spicy Pickle	5363 W Main St, Kalamazoo
Spicy Pickle	3782 W Centre, Portage
Sports Forum	803 W Mosel, Kalamazoo
Squakers	1106 Mills St., Kalamazoo
Stadium Big Boy	4700 Stadium Drive , Kalamazoo
Steak 'n Shake	5371 West Main St, Kalamazoo
Steak 'n Shake	5342 South Westnedge Ave, Portage
Subway	1256 East Centre Street , Portage
Subway	123 East Michigan Avenue , Kalamazoo
Subway	1903 W Michigan Ave , Kalamazoo
Subway Walmart	8250 Shaver Road , Portage
SummerThyme Café	3928 Portage Street , Kalamazoo
Sweetwater's Donut Mill	2138 Sprinkle Road , Kalamazoo
Sweetwater's Donut Mill	3333 Stadium Drive , Kalamazoo
Taco Bob's	6890 Stadium, Kalamazoo
Taco Bob's	248 South St., Kalamazoo
Texas Hunan Gardens	5157 West Q Avenue , Texas Corners
The Birches Banquet Center	3082 South 9th Street , Oshtemo
The Copy Cup	312 W Michigan , Kalamazoo
The Fieldstone Grill	3970 W Centre Ave , Portage
The Pita Pit	2913 S Howard Street , Kalamazoo
The Soup Kettle	150 S Kalamazoo Mall , Kalamazoo
Treat Street	3023 Oakland Drive , Kalamazoo
Uncle Ernie's	4005 Portage Street , Kalamazoo
Uncle Mike's Pizza	5000 Sprinkle, Portage
The Village Coffee Bar	7000 Stadium Drive, Kalamazoo
Wally's Subs	6477 W Stadium Drive , Oshtemo
Washington Square Senior Co-op	710 Collins Street , Kalamazoo
Websters, Radisson Plaza Hotel	100 W. Michigan Ave, Kalamazoo
Wedel's Garden Center/Garden Party Café	5020 Texas Drive , Texas Twp
Wings Etc	7337 E Westnedge Ave, Portage
Zazios, Radisson Plaza Hotel	100 W. Michigan Ave, Kalamazoo

Random Thoughts on the Economy and Obama

1.  Obama's chances of having the Republicans sign on to his first initiative were zero.  He was naive to think otherwise.

2. Revisionist history that the New Deal made the Depression worse are laughable and quite frankly marginalize people like Mitch McConnell (if he had any credibility anyway.)  Look at industrial production from1929 to 1932 and then 1932 to 1937 if you have doubts.

3. Home prices nationwide have declined 20%, but that is counted from inflated prices from 2005 to 2006.  Over the past ten years, however, home prices have still increased.

4. Auto purchases are down from 17 million per year to 14 million.  Do we really need that many new cars which will eventually end up in landfills built every year?  With new technology and better cars, they should last longer. 

5. Obama's stimulus plan is a spending bill.  That's what stimulus is.  Tax cuts are not as useful for stimulus.  Too bad we didn't understand this in 2001 (see #12 below).

6.  Infrastructure needs to be improved in this country... this will improve our efficiency for the next two generations.  That's what the WPA, TVA, rural electrification, interstate highways, etc did in the 1930's to 1950's.

7.  We have been misallocating our resources for the last generation with the expansion of the financial indutry at the expense of nearly all others (except, of course, the military and oil.)  Drug research, access to medical care, education have all suffered.

8.  What's the big whoop if the financial industry contracts by 20-25%?  The investment banks are too big anyway and the home loan industry should be run like a utility: unleveraged, mega-regulated and uniform.

9.  The unemployed are not going to be re-employed at jobs that are at all similar to the ones they lost.  If you made windows or Chryslers before, or worked as an analyst for an i-bank... forget about it... take this oppotunity to learn a useful skill.  Community colleges, baby.

10. I see a new era where conservation comes back into style and conspicuous consumption becomes uncool.  Call it "Depression chic."  Nothing wrong with that, it's good old fashioned frugality and there is something honorable and patriotic to living within your means.

11. If your have any debt, pay it off before the interest rates go up.  

12. GDP growth the last ten years has been illusory and can be accounted for solely from the massive leverage in the financial indusrty.  Real growth was zero or even negative.

Can the Yankess Cancel A-Roid's Contract?

I'm no lawyer but I know that if I were paying him, I'd want my money back.

BTW, Michael Phelps is not even in the same league.  As far as anyone knows, Phelps never cheated by using performance enhancing drugs.  In my opinion, marijuana is in the same class as beer... and nobody's going after Mickey Mantle's or Babe Ruth's  Hall of Fame status.

Happy 200th Birthday, Mr. Darwin

Two centuries ago, arguably the greatest naturalist was born in England.  What Democritus did for philosophy, Copernicus for Astronomy and Isaac Newton for Physics, Charles Darwin achieved in the filed of Biology.  His unifying theory of natural selection based on spontaneous mutation outlined  in the 1859 classic On the Origin of Species has profoundly affected the way we think about the relationships between organisms and environment.

National Geographic has an excellent story and TV show on Darwin's adventures and work. 

NPR discusses the cultural controversies surrounding his theory.

The stimulus needs to stimulate

The nonpartisan Congressional Budget Office has a chart that gives the the relative value of various spending/tax cut policies to GDP growth.  The way I read this is that spending is stimulus, tax cuts are not.  Correct me if I'm wrong, but if this bill is truly intended to stimulate the economy, then it should be primarily a spending bill.  In 2001, we went through this same discussion when Bush and the Republicans passed a tax cut bill in the teeth of a recession, and it had little lasting effect as we are learning now since almost the entire GDP growth has been illusory.

Now for some reason we are having the same tired old discussion.  No doubt I would like my taxes cut as much as the next guy, but the fact is that the CBO-- and almost all serious economists-- states it would have little effect on GDP.  If McCain and Lindsay Graham are not going to try to understand economics then the Democrats should jettison their attempts for a bipartisan compromise and pass the correct bill on straight party lines.  The Republicans have already marginalized themselves with failed policies.

On a related note, Charles Krauthammer lets us know how he really feels with the silliest vitriolic column I've read in quite a while.  While there is valid criticism of the current stimulus bill, Krauthammer seems to have had this thing written months ago and decided to file it this week.  If this type of delusion is emblematic of the way the next 4 years is going to play out, at least we can enjoy the comedy show.   

These same Republicans had almost nothing to say about the massive expenditures in Iraq which was full of waste for an ill-advised war, and BTW, had no multiplier for the US GDP.  

They just won't go away...

Item #1: Former Bush Chief-of-Staff Andy Card's tender sartorial sensibilities have been insulted by President Obama taking his jacket off to get some work done.

Item #2: Dick Cheney is trying to scare the shit out of everyone (again).  

To paraphrase Mr. Cheney when he was showing such great respect for the US Senate:  "Go F*#k yourselves."

Does Obama have the balls to fix this country?

Greenwald has a great take-down of Tom Daschle and his beauty queen trophy wife who, it turns out, are the consummate pigs at the trough of corporate money and Washington largesse.  Whore's whores indeed and good riddance to his appointment to Obama's cabinet.  Read it.

President Obama was interviewed by on CBS News and intimated that he realizes he has made mistakes in his first couple weeks and he is taking measures to remedy the shaky start and has the recognition of his missteps and is putting forth the effort... blah, blah, blah...

Here's the deal:  This country is fucked up.  Obama was elected as an agent of change, but it is becoming clear that what we need is an agent of revolution.  The corporate rapists have taken what they could and have left the sarcophagus behind for us to dispose of.   So far Obama has been conciliatory to the Republican dunderheads on his stimulus bill, selected a right-wing bigot for his inauguration invocation, appointed a GOP free-trader to Commerce, put a tax-evader in charge of Treasury and has placed lobbyists to important posts throughout his administration.

Is it worse than the previous administration?  No, not by a long shot.  By this time eight years ago, Bush already had 4 known war criminals in his cabinet, but I digress.

What we need now is a leader who will disavow the failed policies of the guilded elite who have ruined our banking system, promoted wars without just cause and bought our government with blood money.  If Obama had desired to impress me with his quick start, he has failed.  Here are my recommendations:

1.  Nationalize the failed banks... yesterday.  Their stock goes to zero, only senior debt is recognized and the executives give back their bonuses or go to jail.  Banks should operate like utilities anyway.  Why should these idiots make millions to put our capital (now government funds) at risk when they obviously cannot do it without losing the capital?

2. Stimulate the economy by building infrastructure.  The dumbshit business interests and public cannot be trusted to do the right thing with the finances.  We need roads, telecom and energy-saving infrastructure, not more Chryslers on our highways and plasma TV's in our living rooms.  Great quote: "It would be irresponsible to chose another policy, which would increase our country's indebtedness without having more infrastructure and increased competitiveness in the end."  Why Obama buckled to GOP pressure on his infrastructure expenditures is beyond me.

3. Kick out all the bums who created this economic mess.  I understand that Geithner may have "experience", but realize that he was in charge when all this shit hit the fan and his office   a) didn't see it coming in the first place and    b) screwed up the TARP after the fact.  The only reason Larry Summers... a smarter, better qualified candidate... isn't Treasury Secretary is because he insulted the tender egoes of feminists... which is a terrible basis on which to pick a general in a war.

The Democrats are at their worst when they emulate their Republican counterparts, and so far that seems to be the manner of governance.  Mr. Obama, don't blink now-- let's take this mutha down.  Band-aids don't cure cancer.

The Good, the Bad and the Ugly

Charts for Wednesday:

BEAV is the good one.

BSX is bad only because its name isn't as good as BEAV, otherwise this one looks great.

FLIR is ugly.  It missed out on a big defense contract last month and has hit the skids with no support in sight.