Sunday, June 07, 2009
Selling off the family... gold?
A disturbing piece by Rob Kirby argues that the supposed reduction in the US trade deficit is partly accounted for by surreptitious exports of gold. Worrying on two fronts: first, that the real economic situation is worse than reported, and secondly, that when the gold market takes off, there won't be much left in the US. What will happen to the dollar?
It's not going to be over by Christmas
Charles Hugh Smith thinks the current crisis will turn into a worse depression that the one of the Thirties. Citing Galbraith's study of the latter, he thinks inequality is a driving factor:
...the proximate cause was a vast income disparity which placed much of the prosperous era's profits in the hands of a small wealthy class, who then mal-invested the profits...
- in the "non-real" economy:
The financial Plutocracy, observing that actually producing goods is not very profitable unless you can fix prices [...] sinks its capital into the FIRE economy (finance, insurance and real estate), eschewing real-world investments as comparatively unprofitable.
Though rarely noted, this is a longstanding trait of capitalism stretching back to 1400-era Venice. When trade became less profitable than mainland farmimg, the Venetian Elite stopped funding trading and bought farms on the mainland. As a side effect, Venice ceased to be a military and trading power. But the Elite remained immensely wealthy.
Watch that Gini coefficient rise.
...the proximate cause was a vast income disparity which placed much of the prosperous era's profits in the hands of a small wealthy class, who then mal-invested the profits...
- in the "non-real" economy:
The financial Plutocracy, observing that actually producing goods is not very profitable unless you can fix prices [...] sinks its capital into the FIRE economy (finance, insurance and real estate), eschewing real-world investments as comparatively unprofitable.
Though rarely noted, this is a longstanding trait of capitalism stretching back to 1400-era Venice. When trade became less profitable than mainland farmimg, the Venetian Elite stopped funding trading and bought farms on the mainland. As a side effect, Venice ceased to be a military and trading power. But the Elite remained immensely wealthy.
Watch that Gini coefficient rise.
Friday, June 05, 2009
Education: wha' happen'?
Gervase Phinn, retired longtime primary schools inspector and author, has admitted (I was there) that teacher lesson ratings are a lottery; Chris Woodhead, former Chief Inspector of Schools, has recently said that OFSTED is a waste of time; primary heads have this year overwhelmingy voted to get rid of SATS.
So I thought I'd revisit the notion of corporal punishment, too. Here in the UK, we had a tiny but influential pressure group called STOPP (Society of Teachers Opposed to Physical Punishment). Its spokesman was a Tom Scott*, who used to teach in London. What do I find in the Guardian online?:
One of the leading figures in the campaign to abolish corporal punishment was Tom Scott, then a teacher in Tower Hamlets, east London, who helped set up Stopp, the Society of Teachers Opposed to Physical Punishment. Scott is believed to have quit teaching since, and retrained as a theatre director.
I've watched it all happen. The replacement of CSEs and O levels by GCSEs; the move towards, then away from continuous assessment; phonics as obligatory, then phonics as career suicide, then phonics as essential again; book-burning by heads of English in secondary schools (literally) to ensure that coursebooks could never again be used, followed by the fay ce que voudras English curriculum; then the "we'll sort the teachers out" National Curriculum; then the exploitation of the need for new textbooks by commercial publishers; then the teaching of sciences coalescing into a general science, the withering of maths, combined with introduction of PC characters in the SATS assessments to mix-in multicultural social issues...
Tosspots.
___________________________________________________
*I don't know whether he's the same Tom Scott who ran the Eye Theatre and/or later joined the BBC's whizzy digital department...
So I thought I'd revisit the notion of corporal punishment, too. Here in the UK, we had a tiny but influential pressure group called STOPP (Society of Teachers Opposed to Physical Punishment). Its spokesman was a Tom Scott*, who used to teach in London. What do I find in the Guardian online?:
One of the leading figures in the campaign to abolish corporal punishment was Tom Scott, then a teacher in Tower Hamlets, east London, who helped set up Stopp, the Society of Teachers Opposed to Physical Punishment. Scott is believed to have quit teaching since, and retrained as a theatre director.
I've watched it all happen. The replacement of CSEs and O levels by GCSEs; the move towards, then away from continuous assessment; phonics as obligatory, then phonics as career suicide, then phonics as essential again; book-burning by heads of English in secondary schools (literally) to ensure that coursebooks could never again be used, followed by the fay ce que voudras English curriculum; then the "we'll sort the teachers out" National Curriculum; then the exploitation of the need for new textbooks by commercial publishers; then the teaching of sciences coalescing into a general science, the withering of maths, combined with introduction of PC characters in the SATS assessments to mix-in multicultural social issues...
Tosspots.
___________________________________________________
*I don't know whether he's the same Tom Scott who ran the Eye Theatre and/or later joined the BBC's whizzy digital department...
Wednesday, June 03, 2009
Tuesday, June 02, 2009
Fight
James has posted on liberty recently - an issue that underlies and will outlast all the economic turmoil of the recent and soon to come years. The prophets foretold this a century and more ago - the langorous and progressively enfolding embrace of the octopus...
Would it even be possible to hold the American revolution today? The Boston Tea Party? Imagine if George III had been able to sit in his palace across the ocean, look at the security-camera footage, press a button, and freeze the bank accounts of everyone there. Oh, well, we won’t be needing another revolt, will we? But the consequence of funding the metastasization of government through the confiscation of the fruits of the citizen’s labor is the remorseless shriveling of liberty.
Read more from the excellent and usually sharply funny Mark Steyn.
Would it even be possible to hold the American revolution today? The Boston Tea Party? Imagine if George III had been able to sit in his palace across the ocean, look at the security-camera footage, press a button, and freeze the bank accounts of everyone there. Oh, well, we won’t be needing another revolt, will we? But the consequence of funding the metastasization of government through the confiscation of the fruits of the citizen’s labor is the remorseless shriveling of liberty.
Read more from the excellent and usually sharply funny Mark Steyn.
Sunday, May 31, 2009
History Revisited?
I have just finished re-watching Jacob Bronowski's wonderful 'The Ascent of Man' series, which I first saw as a teenager.
In his segment on Isaac Newton, he notes that Newton couldn't get the attention of the rich and influential in his middle years. The reason was that there was little interest in science and technology, since so many were making fortunes in the South Sea Bubble scam.
It struck me at that moment that the disinvestment in science and technology in the US and UK for the past 30 years may be due to a similar set of cicumstances, since so much money was being conjured out of thin air, first in the dotcom bubble, and then in artificial housing prices.
In his segment on Isaac Newton, he notes that Newton couldn't get the attention of the rich and influential in his middle years. The reason was that there was little interest in science and technology, since so many were making fortunes in the South Sea Bubble scam.
It struck me at that moment that the disinvestment in science and technology in the US and UK for the past 30 years may be due to a similar set of cicumstances, since so much money was being conjured out of thin air, first in the dotcom bubble, and then in artificial housing prices.
Thursday, May 21, 2009
Welcome, the Gurkhas
If we're not a country fit for heroes, we're a country fit for nothing. By righting this injustice, we have recovered a little of our honour.
Tuesday, May 19, 2009
Sunday, May 17, 2009
The biggest bubble: human population
I've been watching BBC1's "Countryfile" and there was a reference to some CO2 reduction target, required because the world's population will be 9 billion by some date.
This is cart before horse. If we don't want the world to become composed solely of (a) people (b) things we need for food and drink c) weapons and (d) radioactive and otherwise polluted and barren desert, we need to:
1. limit human population growth...
2. ... without creating demographic gender imbalance
3. ... or demographic age imbalance
I read "Blueprint for Survival" in a Penguin edition in the 70s. One point it discussed, which had not occurred to me, was that the deceleration - population stabilisation/reduction - has to be slow and planned, otherwise we will develop serious imbalances that will destroy the economy and trigger a crash - a real, lethal one, not just the loss of some savings.
Time - time long overdue - for a plan to tackle this super-bubble. Wind farms and CO2 targets are near-irrelevancies.
This is cart before horse. If we don't want the world to become composed solely of (a) people (b) things we need for food and drink c) weapons and (d) radioactive and otherwise polluted and barren desert, we need to:
1. limit human population growth...
2. ... without creating demographic gender imbalance
3. ... or demographic age imbalance
I read "Blueprint for Survival" in a Penguin edition in the 70s. One point it discussed, which had not occurred to me, was that the deceleration - population stabilisation/reduction - has to be slow and planned, otherwise we will develop serious imbalances that will destroy the economy and trigger a crash - a real, lethal one, not just the loss of some savings.
Time - time long overdue - for a plan to tackle this super-bubble. Wind farms and CO2 targets are near-irrelevancies.
Friday, May 15, 2009
The memory hole
From The Grumbler, but strangely, on page 9 in the dead tree version, rather than the front page:
Tony Blair dodged possible fire over his housing deals after hundreds of expenses claims were 'accidentally' shredded.
Documents itemising some of the then Prime Minister's receipts for 2001-02 were destroyed by Commons officials 'by mistake'.
Raising his voice above the shredders' roar, a source close to a former Prime Minister bawled that he was a pretty straight kind of a guy. Your correspondent made his excuses and left, pursued by an alcoholic pugilist making dark references to discoveries in woods.
Tony Blair dodged possible fire over his housing deals after hundreds of expenses claims were 'accidentally' shredded.
Documents itemising some of the then Prime Minister's receipts for 2001-02 were destroyed by Commons officials 'by mistake'.
Raising his voice above the shredders' roar, a source close to a former Prime Minister bawled that he was a pretty straight kind of a guy. Your correspondent made his excuses and left, pursued by an alcoholic pugilist making dark references to discoveries in woods.
Thursday, May 14, 2009
Still stuck on the 'B' Ark
At the university where I work, we have a few good science programs, and a well-respected engineering college.
In the past few years, we have seen significant increases in enrollment. I attribute that to:
a) the fact that there are fewer good jobs out there
and
b) while the typical 18-year-old is lazy and ignorant, they are not stupid. Consequently, they are flocking to the analytical fields (where the jobs are), including mathematics and science education.
However, our student services people are convinced that it is because of the advertisements, 'student appreciation days', and the like, not the teaching that we do.
Accordingly, they recently brought in management experts to help us in recruitment and retention efforts.
And where did these experts come from, to help out academia? The Disney corporation!
I must really work for a Mickey Mouse operation.
In the past few years, we have seen significant increases in enrollment. I attribute that to:
a) the fact that there are fewer good jobs out there
and
b) while the typical 18-year-old is lazy and ignorant, they are not stupid. Consequently, they are flocking to the analytical fields (where the jobs are), including mathematics and science education.
However, our student services people are convinced that it is because of the advertisements, 'student appreciation days', and the like, not the teaching that we do.
Accordingly, they recently brought in management experts to help us in recruitment and retention efforts.
And where did these experts come from, to help out academia? The Disney corporation!
I must really work for a Mickey Mouse operation.
Dow 4,000 yet again
The Mogambo Guru is off on one of his comedy riffs again, and reiterating his devotion to gold, but here's a statistic he quotes midway:
“the price-to-earnings ratio for the Dow Jones Industrial Index is now a hefty 43.1! It should be, historically, less than 20!”
Do the math, as they say. In fact, I'll do it for you now: take the Dow at close the night before Mogambo ranted (8,469.11) and multiply by 20/43.1. Result: 3,929.98.
I gues the question is, is the current low level of company earnings a temporary matter caused by recent dislocations, or is it set to continue as the economic climate darkens?
Plus, as we all know, the market can stay irrational longer than you can stay solvent. But I still think that, adjusted for what now seems inevitable high inflation, we're going to see Dow 4,000 sometime, as I graphed back in December:
“the price-to-earnings ratio for the Dow Jones Industrial Index is now a hefty 43.1! It should be, historically, less than 20!”
Do the math, as they say. In fact, I'll do it for you now: take the Dow at close the night before Mogambo ranted (8,469.11) and multiply by 20/43.1. Result: 3,929.98.
I gues the question is, is the current low level of company earnings a temporary matter caused by recent dislocations, or is it set to continue as the economic climate darkens?
Plus, as we all know, the market can stay irrational longer than you can stay solvent. But I still think that, adjusted for what now seems inevitable high inflation, we're going to see Dow 4,000 sometime, as I graphed back in December:
Wednesday, May 13, 2009
Why inflation is going to hit us
Scott Burns at MSN Money (htp: Michael Panzner) calculates that unfunded government programs for social security and Medicare ($46 trillion) represent a debt equivalent to around 90% of all consumers' net worth ($51.5 trillion). If Americans' net assets decline by a further 10%, then effectively the American citizen is bust.Can anyone provide equivalent information for the UK?
Tuesday, May 12, 2009
Monday, May 11, 2009
Sunday, May 10, 2009
A velvet revolution, or a concrete one?
In a recent post, "Paddington" compared us with our forefathers, to our detriment. Now, Jeffrey R. Nyquist does the same:
We think that we are more sophisticated than our grandfathers. But we are less sophisticated, by far. Our descent into darkness is best demonstrated by listing old artists beside new artists; by listing old statesmen beside new statesmen; by comparing the lives of our grandparents to our own. The sociologist notices that more children are born outside of marriage, that epidemic cheating has taken our schools by the throat, that we have incompetence in business and government, that we find banality and ignorance on all sides. What conclusion can he draw? The powers and advantages of modern life haven’t made us worthy. They merely serve to amplify and accelerate our unworthiness.
I am amazed by those who think the U.S. economy is going to recover, that global peace is attainable, that American liberties are going to survive American barbarism. Look at our culture today: men are no longer men, and women are no longer women; capitalists no longer uphold free market principles; constitutional government no longer adheres to the Constitution; enemies are treated as friends. Nobody reads the signs. Nobody sees what is coming. Look at the birthrate among Europeans. Look at the abandonment of European culture. Look at the Muslim birthrate. Europe will be Islamic in fifty years. Long before that, the Russians and Chinese will achieve nuclear dominance of the globe. What do you think the investment climate will be in 2059?
Again and again, we are reminded that the issues are much bigger than mere money. I think that we could be on the verge of a social and political revolution, especially if whoever next takes on our nations' problems fails as signally as the present administration. To be clear, I don't welcome revolution, and don't expect its aftermath to be better than the state of affairs that preceded it. There must be effective reform, soon.
We think that we are more sophisticated than our grandfathers. But we are less sophisticated, by far. Our descent into darkness is best demonstrated by listing old artists beside new artists; by listing old statesmen beside new statesmen; by comparing the lives of our grandparents to our own. The sociologist notices that more children are born outside of marriage, that epidemic cheating has taken our schools by the throat, that we have incompetence in business and government, that we find banality and ignorance on all sides. What conclusion can he draw? The powers and advantages of modern life haven’t made us worthy. They merely serve to amplify and accelerate our unworthiness.
I am amazed by those who think the U.S. economy is going to recover, that global peace is attainable, that American liberties are going to survive American barbarism. Look at our culture today: men are no longer men, and women are no longer women; capitalists no longer uphold free market principles; constitutional government no longer adheres to the Constitution; enemies are treated as friends. Nobody reads the signs. Nobody sees what is coming. Look at the birthrate among Europeans. Look at the abandonment of European culture. Look at the Muslim birthrate. Europe will be Islamic in fifty years. Long before that, the Russians and Chinese will achieve nuclear dominance of the globe. What do you think the investment climate will be in 2059?
Again and again, we are reminded that the issues are much bigger than mere money. I think that we could be on the verge of a social and political revolution, especially if whoever next takes on our nations' problems fails as signally as the present administration. To be clear, I don't welcome revolution, and don't expect its aftermath to be better than the state of affairs that preceded it. There must be effective reform, soon.
Us banks vs UK banks
We are now getting used to hearing that the UK is the worst-placed among the G20 countries to recover from the credit crunch. One reason is that we have few banks, and almost all of them in trouble.
By contrast, as you see here, the US has 8,500 banks, most of them in good condition. The problems are concentrated in their handful of giants. Over there, it would be possible to bust them and have others ready to take on their books of loans (discounted) and deposits.
Here, I think we'd have to create a new bank, if only to provide some competition for Barclays and HSBC.
By contrast, as you see here, the US has 8,500 banks, most of them in good condition. The problems are concentrated in their handful of giants. Over there, it would be possible to bust them and have others ready to take on their books of loans (discounted) and deposits.
Here, I think we'd have to create a new bank, if only to provide some competition for Barclays and HSBC.
A lighter moment
I wish I could embed this one, but please click on the link to see an outstanding and very funny example of hysterical greed:
http://www.youtube.com/watch?v=70wuAWxOEZA
http://www.youtube.com/watch?v=70wuAWxOEZA
... but the Revolution begins at home
We attended the memorial service for a friend yesterday, and the following quotation (Acts, Chap. 2, vv. 44-47 - King James version) was included in the readings:
And all that believed were together, and had all things common;
And sold their possessions and goods, and parted them to all men, as every man had need.
And they, continuing daily with one accord in the temple, and breaking bread from house to house, did eat their meat with gladness and singleness of heart,
Praising God, and having favour with all the people. And the Lord added to the church daily such as should be saved.
It's a big ask, as they say; and the more we have, the bigger an ask it is. Jesus' advice to the rich young man (Matthew 19, v. 21) is after the latter has confirmed that he already performs all the normal religious duties:
If thou wilt be perfect, go and sell that thou hast, and give to the poor, and thou shalt have treasure in heaven: and come and follow me.
It was too much for that trustafarian, and it's too much for modern us. So we try to explain it away, Philadelphia lawyer-style. Clever people will explain that if you give away all, you'll merely be a charity case yourself. Or they'll tell you that the advice was case-specific: the young man needed freeing from his attachment to material things (and, presumably, we don't).
Yet the history of the early Church clearly shows that these sophisticated glosses are plain wrong. They were far, far closer to the revolutionary events (and witnesses) of the New Testament, and we must assume that they understood the message better. "Such as should be saved" must join the project, and obey the project's rules.
Reportedly, 82% of Americans are Christians (even the Simpson family). Many sincerely try to follow the early example - think of the people who took in refugees from Katrina-devastated New Orleans, and how some of these good hosts were robbed and even killed as a result.
But writing comments on US blogs suggesting sharing resources (even in the bureacratic form of the NHS) will get sharp ripostes accusing you of socialism or worse.
It's still a big ask, isn't it? And still too big for me, at the moment.
And all that believed were together, and had all things common;
And sold their possessions and goods, and parted them to all men, as every man had need.
And they, continuing daily with one accord in the temple, and breaking bread from house to house, did eat their meat with gladness and singleness of heart,
Praising God, and having favour with all the people. And the Lord added to the church daily such as should be saved.
It's a big ask, as they say; and the more we have, the bigger an ask it is. Jesus' advice to the rich young man (Matthew 19, v. 21) is after the latter has confirmed that he already performs all the normal religious duties:
If thou wilt be perfect, go and sell that thou hast, and give to the poor, and thou shalt have treasure in heaven: and come and follow me.
It was too much for that trustafarian, and it's too much for modern us. So we try to explain it away, Philadelphia lawyer-style. Clever people will explain that if you give away all, you'll merely be a charity case yourself. Or they'll tell you that the advice was case-specific: the young man needed freeing from his attachment to material things (and, presumably, we don't).
Yet the history of the early Church clearly shows that these sophisticated glosses are plain wrong. They were far, far closer to the revolutionary events (and witnesses) of the New Testament, and we must assume that they understood the message better. "Such as should be saved" must join the project, and obey the project's rules.
Reportedly, 82% of Americans are Christians (even the Simpson family). Many sincerely try to follow the early example - think of the people who took in refugees from Katrina-devastated New Orleans, and how some of these good hosts were robbed and even killed as a result.
But writing comments on US blogs suggesting sharing resources (even in the bureacratic form of the NHS) will get sharp ripostes accusing you of socialism or worse.
It's still a big ask, isn't it? And still too big for me, at the moment.
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