Honestly who believes the SEC at this point? But here it is:
The Securities and Exchange Commission yesterday rejected calls by banks to suspend an accounting rule blamed for exacerbating the financial crisis, saying the "fair- value" standard should instead be improved.
Bustout
The intentional act of driving a company into insolvency in order to extract as much of the assets as possible form the company for the use of the operators.
So this is how it worked: instead of greening our manufacturing base, amping up our recycling system and competing on the basis of better production technology, we shipped our production to China, which is busy polluting themselves and spewing carbon dioxide. In return, the Chinese took the hundreds of billions from sales to the U.S. and reinvested the money here, helping to make our sprawl even spawlier and our military even more wasteful.
You may not like Kuntsler's heavy-handed disdain for, well, most everything, but he's great at generating real zingers, and he is right on target about the need to move the U.S. and the rest of the world off of an economy based on burning fossil fuels.
I expect a period of euphoria to mark the early weeks, perhaps months, of the Obama team. It will be a relief to have a president who speaks English correctly and has experienced something like real life prior to politics. Restoring credibility and legitimacy in leadership will be a big deal. If nothing else, we may recover a collective sense of consequence from a president who tells the truth, even the harsh truth. The age when it was enough to claim that "mistakes were made" might be over. A sign of this sort of change may be the commencement of prosecutions for misdeeds in banking and securities that are now destroying the entire system of deployable capital.
If you've been reading me this year, you know I have made a few highly contrarian calls that turned out to be correct. Most importantly, that after picking up early in the year, demand destruction during the recession that I already believed was happening, would cause inflation to fade strongly later in the year. As a corollary to that, when others were counting the days until $130 a barrel oil would hit $200, I called it a top, and started a Countdown to $100 Oil that turned out to be too tame! I also was among the first on the blogosphere to note that China's bubble was bursting and that the recession would go global, and that the markets feared deflation.
But there is one call I made over a year ago which now can be given a well-deserved burial: the notion that there would be a "respite" in the ongoing "slow motion bust" at some point before the end of 2008.
Greetings folks, I hope your holiday season is going well. In case you were wondering, there was no Manufacturing update last week, family and health related issues. This week will be kinda short, my apologies, but I wanted to cut some of the gloom and doom for the holiday season. We got stuff on solar energy, a new grant system for electric car innovation, milestones on wind, and something for the kids! But as always, we hit our first section...
An opinion piece by Bob Herbert in the New York Times kind of says it all. Stop Being Stupid on U.S. economy policy.
Ya got that right! He lists a series of absurd policy positions and the make-believe public relations talking points that followed it as a classic case of denial by policy makers and by the American people. One call out I particularly enjoyed:
We were stupid in so many ways. We shipped American jobs overseas by the millions and came up with the fiction that this was a good deal for just about everybody. We could have and should have taken the time and made the effort to think globalization through, to be smarter about it and craft ways to cushion its more harmful effects and to share its benefits more equitably.
It is clear that we are in an economic environment that we have not seen in over half a century. Statistics that have been generated only since World War 2 cover a period of time which was marked almost exclusively by continuous inflation. The last deflationary recession was in 1949-50.
As a result, many measures that accurately forecast changes in the economy during an inflationary period (for example, a positive sloping yield curve) may not apply now. Thus, I have been looking for statistical measures or comparisons that have data back to 1929, and appear to have given accurate readings even during deflationary periods. In general, it appears that the Kasriel indicator of positive yield curve + M1 money supply consistently growing in an absolute sense, and also faster than inflation did accurately coincide with periods of growth even during the Great Depression. Additionally, M2 money supply growing faster than commercial bank loans also coincided with the onset of recovery even prior to WW2. I have also looked at the role of an increase in the rate of real residential investment compared with GDP as a harbinger of recovery.
the notion that there would be a "respite" in the ongoing "slow motion bust" at some point before the end of 2008.
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