Lessons from history

The Debt Offensive began in 2007: Charlie hit us with everything he had. Cadres of underpriced risk were tunnelling under our lines, popping up when least expected and decimating our defences. We fought back hard, dropping cash from the Hueys, first $700 billion, then trillions, but it was no use. Sure, we beat him back for a while, took down a few banks; but the public couldn't take seeing it all on TV. It was the turning point. We had lost the will to win.

Bozos in Parade

Two related items in today's Parade Sunday magazine caught my eye.

1. In reference to an intensive 2.5-year program in Computer Science at Neumont University, a Professor of Higher Education at Boston College is quoted as saying "I'm sure that they turn out really great technicians, but how are these students going to fit into the real world?"

Given that the real world is populated by a large percentage of what appear to be idiots, she's probably correct. However, many of the future teachers that I have taught do not appear to know anything about English, Mathematics, History, Geography, or even a foreign language. For them, higher education appears only to be a way to a job.

2. A piece taken from a new book, begins "Humans are good at many things - typing, inventing stuff - but we're quite bad at assessing risk".

To begin, I wouldn't class being a competent typist with being an inventor, any more than I would compare driving skill with a concert performance.

At most 5% of the population in the industrial world actually 'invents things', or advances human knowledge. Most of the rest just use it. Has it occurred to these authors that the same idiots who use all of that technology without understanding might just be the ones who panic unjustifiably?

Wine pressings

The crush of the present distils wisdom:

In general, my own prescription is all that I will share. I am 58 years old, and have amassed a fair amount of savings over the past twenty years. My general rules for the current period now are:

1. Get liquid. Have little or no debt. Be in cash and diversified. Reduce your expenses.
2. Get as far away as you can from Wall Street and dollar based assets as is practical.
3. Put something you can spare from savings into long term assets that are not directly contingent on anyone else whom you cannot trust:

a. Personal food production, preservation, and preparation
b. Precious metals as insurance against monetary inflation / breakdown
c. Essentials for daily living and personal health care
d. Investments in practical education
e. Personal infrastructure and efficiency

f. Have a contingency plan for a systemic shock.

If you wish raise your voice or to peacefully demonstrate, be prepared with a simple set of coherent positions and specific demands, avoiding anger. The mainstream media likes nothing better than to portrary demonstrators as cranks or fools. In general they are not sympathetic to the less powerful. They will not lead change, but they will eventually follow.

The "funny money" Dow

Comparing the Dow with CPI, and with debt

From economic crisis, towards politics and social change

Leo Kolivakis deeply regrets having to miss lunch with Michael Hudson:

[Dr Hudson argues] that we are moving to a "Neo-Feudal" world where the landlords and the bankers are again in charge of the economy (and the world).

Their strategy is to get the rest of the country into as much debt as possible. Whether this is so they can increase their claims on financial wealth (rents, interest payments, and capital gains on asset prices) or whether it's a political program to subjugate the population...that's one of the questions we were going to ask.

We were also going to ask if the "de-industrialisation" of advanced Western economies that Dr. Hudson talks about is a reversible process. Can Europe and America ever compete with China and Asia in manufactured goods? And if they can only do so in high-end goods (capital goods, technology, aerospace, IT etc.) what does that mean for the structure of employment in Western economies and corporate earnings.

Dr. Hudson, it seems to us, is right to point out that there is a kind of "Financial Oligarchy" that seems to be benefiting the most from the financialization of the economy. But everyone else - those betting on higher share and house prices to pay for retirement (and pay off huge debts) - may not fare so well. What should you do? What can you do? More on this in future reckonings.

US economic weakness to be exploited by China

Padders alerts me to this succinct WSJ article by Zakary Karabell, warning that just as the US leapfrogged a bankrupt Britain in 1945, China looks likely to do the same to the US.

Crony capitalism is our Vietnam War

Jesse passes on this CNBC tidbit, which explains how ex-Goldman Sachs operatives embedded in the US regulatory systems gave GS $70 billion just when nobody else had cash, so GS could buy up assets at fire sale prices and make monstrous profits at the taxpayers' expense. Truly, it's us against them, but all we can do is wave our placards as their limos cruise by.

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

She's mine!

One teacher told how she and her new boyfriend snuggled up for the night, only to have her tomcat jump on top and soak them with urine.

So they heaved aside the soggy duvet and decamped to the second bedroom. But Tom came in and did it again.

They ended up having to grab a couple of blankets and sleep on the sofa downstairs.

And...

As Goldfinger says, "Once is happenstance. Twice is coincidence. Three times is enemy action.”

Laughing at the underclass

Doing the rounds on the Internet:

Two reasons why it's so hard to solve a redneck murder:

1. The DNA all matches.
2. There are no dental records.