There was no profound attention by Republican politicians to the wars the USA continues to pay for.

Now this is more like it? Karzai isn't complaining about civilian casualities, now is he?

Let the damn ideologues of Paksitan and Afghanistan find out EXACTLY what happens when peace is not their agenda !!!!!

The tenth anniversary of September 11, 2001 is nearly upon us. Somehow, closing the theater in a meaningful way in this region of the world seems right.

Evidently, al Qaeda, the Taliban and Pakistan thought they would teach the USA a lesson in regard to bin Laden. Really?

There is a second helicopter that experienced a 'hard landing' as well.  The USA military isn't being smart about the number of soldiers in a helicopter at any given time.  In emergency there may be no other choice, but, if this is common practice in Afghanistan, it isn't a good one.

Unless, an in depth investigation by the USA proves otherwise, this was a retaliatory strike against the USA over the death of bin Laden.  This is bin Laden's replacement.  What's his name?  Aimen or whatever.  Zwaheri.  Whatever.

This was an inside job.  My guess is that someone with knowledge as to whom was in that helicopter passed on that information to make an impression on the USA about their aggressive nature in the world.  I mean it was an incredible operation.  Every leader, regardless of terrorist network, is checking and rechecking their security.  That's a given. 

So.  To believe that Pakistan ISI wasn't involved in this HAS TO BE PROVEN to be a bad assessment.  Unless the actual person responsible for this can be clearly identified, then the operations there are in danger and it has to include a sovereign entity from somewhere.  Someone who doesn't consider the FBI Most Wanted List a worry.

I look forward to a complete report from the USA military. 

It is a mistake to simply disregard the downgrade by S&P.

The S&P downgrade is a reaction to 'the politics' behind the spectacle of the USA House over the President's request for a "Grand Plan."  There was an unthinkable approach to the Debt Ceiling in believing it is okay to play politics with a sovereign debt.  There were 'elements' of the Tea Party stating it didn't believe Secretary Geithner in that August 2nd was a cut off date to the Debt Ceiling increase.  Those members of the House were willing to impale the USA's sovereign debt without knowing what they were doing and denying the authority of the Secretary of the Treasury.

Secretary Geithner took an oath of office no different than any other member of the cabinet and to believe he was 'fudging' his math and making political projections is hideous and ridiculous.  The entire episode which required the involvment of the USA citizens to bring pressure on these legislators was a clear demonstration of how the power of the USA, in the wrong hands, can be hideously played with while there is a global economy attempting to recover.

I strongly believe the rating agency, Standards and Poors was very rattled by the entire circus that lasted far too long.  The House never took the reassessment of Secretary Geithner seriously to finally end any and all debate in a three month window to ensure the nation's credit worthiness.  It was completely ridiculous.  Why should anyone believe this 'arm' of the Republican Party would not do exactly what is claims it will do after this clear demonstration of abuse of power.  S&P is correct to some extent.  While the Treasury Secretary is confident of the ability of the USA to pay its debt, the fact of the matter is he can't speak to any of that beyond his term.  There are issues here and S&P decided to act on those issues while other agencies decided the American people are more powerful than the bozos at the center of the main ring of the Republican circus.

I believe it is a very big mistake to see this downgrade by S&P as a fear of the USA politics that does repeat itself from its history.  It was a logical step for them.  The math was not the focus with S&P so much as the unbelievably hideous actions and statements of House members.  This agency felt 'threatened.'  That can't be completely dismissed as a math error.

By Randall Forsyth (click title to entry - thank you)

The market relevance of S&P’s stripping of the U.S.’s AAA rating is plain in the rise in price and fall in yields on U.S. Treasury securities. That is, nil.

The benchmark 10-year note yield is back below 2.5%, down 10 basis points from Friday at 2.46%, as investors continue to seek U.S. government securities as the safest haven in a turbulent world, notwithstanding S&P’s protestations. At the same time, the two-year note yield is at “two bits” again, or 0.25%, down four basis points. And the long end, which did sell off initially Sunday evening, has come roaring back with the 30-year bond yield off seven basis points, at 3.77%. (Newbies note: prices and yields of bonds move inversely.)

The market is behind the move in U.S. Treasuries, unlike those of the sovereign debt of Italy and Spain. Those truly impaired credits have been bolstered by the decision of the European Central Bank to buy those bonds, which are rated not far below those of the U.S. Italian 10-year yields plunged more than 60 basis points, to below 5.5%, while the Italian equivalent yield is down about three-quarters of a percentage point (74 basis points), to 5.30%. Italy and Spain are not assured of being able to refinance or repay their debts, which are issued in euros, a currency not under their direct control. By contrast, the U.S. can pay its bonds in the world’s reserve currency which it uniquely can print....

It looks like Republicans can't do math well enough to rebuke Grover Norquist.

According to Speaker Boner last week he "...got 98% of what he wanted."  The problem was that he wasn't the President and would not ADMIT the "Grand Plan" including tax increases on the wealthy was NECESSARY.  I'll be darn!

What's next Boner, now that 'the math' you did would impale the USA rating? 

Dissolution of SSI, Medicare and Medicaid?

...Something didn’t look right to John Bellows, (click title to entry - thank you) the Treasury’s acting assistant secretary for economic policy. He found what he later called a $2 trillion “basic math error” in the e-mail, a preliminary press release announcing S&P’s first-ever downgrade of U.S. creditworthiness.

Over the next 5 1/2 hours, the two sides argued over issues ranging from so-called baseline calculations to deficits, according to a person familiar with the matter. In the end, the ratings firm stuck with its decision, citing the level of government debt and the contentious political climate in Washington.

The debate in Congress over raising the debt limit “highlighted a degree of uncertainty around the political policymaking process which we think is incompatible with a AAA rating,” David Beers, S&P’s managing director of sovereign ratings, said later on a conference call with reporters. ...

Sort of unrelated, but abuse is noted here. Do violent surroundings, such as some inner city children experience, become a self-fulling prophesy?

Looking (click title to entry - thank  you) at over 18,000 adults from 10 countries, the study found that those who said they'd faced childhood adversities like abuse, the death of a parent, or a parent's alcohol or drug abuse, had higher risks of heart disease, arthritis, asthma, diabetes and other conditions....

..."Early adverse experiences can shape people's behavior and lifestyle," she told Reuters Health by email, noting that some people may end up smoking, drinking or over-eating as a way of dealing with the stresses of those childhood experiences, and the memories of them....

..."When the stress is ongoing, such as in long-term childhood maltreatment, then there can be health consequences of those (stress hormones) being consistently elevated," she added....

"Happy Birthday, President Obama"

I hope I am not the first to mention this is a half century now since the first day in Hawaii.


It isn't horrible from here, but, I can't honestly say it gets better.


The "Basketball Lip" should be your first clue.


Hope you Birthday has been wonderful.  

In 1896 the DOW wasn't as much an economic focus as it is today.

When the global community gets a good look at the worst the USA has to offer in leadership as was witnessed with the House of Representatives and their complete and unquestionable willingness to default the USA obligations, things change.


Besides the other topics of conversation today around Wall Street, the first inkling of a downward trend, everyone will head for the hills.

By David K. Randall, Associated Press / August 4, 2011

NEW YORK

The stock market is finishing its worst day since the financial crisis.(click title to entry - thank you) 

The Dow Jones industrial average plunged more than 500 points Thursday. Investors are concerned that the U.S. economy will enter another recession and that Europe's debt problems are not closed to being solved.

Major stock indexes fell more than 4 percent.

The Dow is closing with a loss of 513 points, or 4.3 percent, to 11,384. It was the worst day for the Dow since October 22, 2008.

The S&P 500 is down 60, or 4.8 percent, to 1,200. The Nasdaq is down 137, or 5.1 percent, to 2,556.

Twenty stocks fell for every one that rose on the New York Stock Exchange. Volume was very heavy at 7.5 billion shares.

I don't blame them.  But, they are also self defeating.  There isn't much to say.  The USA House of Representatives are proving everyday how unable they are to govern.  They reworded the language in the FAA authorization and caused an implosion of the entire industry resulting in furloughs and layoffs.  

A government the size of the USA, we are not Greece by a long shot, or anyone else for that matter, cannot simply change a few words here and a few words there and yank monies out from under the industry, small airports or not without catastrophe striking.  It doesn't work that way.

There needed to be a short term reauthorization of the FAA until all the details could be worked out in the new patchwork quilt presented to the Senate from the House.  Basically, the House does not accept leadership from anyone, including their own Speaker.

Senator Harry Reid: COMPROMISE on hand to end FAA shutdown (click here)

by EYDER PERALTA

"Senate Majority Leader Harry Reid says there is bipartisan compromise to end the partial shutdown of the Federal Aviation Administration that has left 74,000 transportation and construction workers idled," writes the AP.

The AP adds that Reid did not specify details in his statement, but other officials say the Senate could approve a House bill as soon as Friday.

This story is still developing. We'll update as we hear more.

The minority party in the House, namely the Tea Party, is working at the federal level where change occurs slowly.  The small airports that exist for the successful travel of many Americans can't be abandoned without NOTICE.

Understand notice?  If the USA government is going to stop subsidies it rewrites the law so that a given time in the future the subsidies will be stopped.  It gives the enterprises enough time to reorganize or merg or accommodates their customers and employees in a different way.

It is no different with the DOW.  The 'instability' the USA federal government is exhibiting is more than a worry; it is a huge amount of trouble for investors.  There is nothing worst for global markets than instability and the federal government in the USA is the last place where this should be occurring when it has been the USA that was leading the recovery.

Now, the idea that companies within the USA were starting to be more optimistic about adding jobs and expanding their profits will stop.  Rather than expanding the economy and the tax base to improve market activity, now there is a fair to good chance there will be more contraction because of ever increasing uncertainty coming from the one place where it should never exist and that is the USA Federal government.  So, while Mitch McConnell believes he is being a wise man to make “Obama a one term president” he is actually causing more problems than he will ever solve.

 Even companies near and dear to the American people of which we helped recover, namely auto manufacturers, will give the 'market place' a second and third look before expanding their operations.  THAT is a tragedy, not just a set back.  Why?  Because some of the most cutting edge technology within the automotive industry is right here in the USA.  That means it would lead to greater exports and a better trade balance. 

The current House leadership is not sufficient to rein in their most extremist elements and that is going to cause problems over and over.  The second option in leadership will only make it worse.  It is for that reason alone there cannot be repeated debates about the deficit, the debt, the budget, the tax structure.  Every time the opportunity arises the Tea Baggers reek holy hell with everything and they don't care if the ship sinks.  They just don't.

What the Tea Baggers CAN'T get their minds around is that markets like the DOW aren't $12,000 and falling.  It is about millions and billions and falling.  That dynamic seems to escape them and they certainly are NOT preoccupied with REASSURING anyone, especially the people dependent on small airports among other things.

What are ya gonna do?  

Maybe Secretary Geithner needs to run a few seminars for the Republicans in the House.  I am serious.  These House members are a disaster.  And make it mandatory.  Don't shoot yourselves in the foot folks.  You either McConnell.  You aren't immune either!  

I am going to be traveling.

Take care.

It is winter in Australia and they are having fun looking for warmer climate.

...TTF chief executive John Lee said Australians were bargain hunting in the shopping hot spots.

"It's about bars, beaches and boutiques, with the number of Aussies going to Indonesia up by 153,000, the US up 116,000 and Thailand up 54,000 in just 12 months," he said.

"People are leaving with empty bags and returning with bulging suitcases, putting the increased buying power of the Australian dollar to good use."

Mr Lee said only two of our top 20 overseas destinations had had a drop in travel by Australians....

This POLITICAL INSTABILITY being witnessed in the USA is nothing new.

As a matter of fact it is NORMAL for this democracy.


I don't believe any of the Tea Party or the Republicans are going to go haywire and decide to attempt to change the standard of USA currency.


What has occurred in the USA by The Fed, however, has caused its damage.  Some might think it was a good thing, but, in my opinion it made things more difficult for the recovery.  The theory is that a 'weak' dollar provides an incentive to purchase American goods.  That is not exactly the case this time.  The USA Dollar is the global measure of currency value and it has a global penetration, so to devalue the dollar during a recession to encourage USA economic growth when the entire world economy is volatile only adds fuel to the fire.


That said, the markets need to find their 'stability' in reassurances by governments to THE  VISION of their future in the world.  I could provide some kind of vision, but, it isn't really my place.  China and India best look to increasing their quality of life and to the extent the USA outsourcing provided its beginnings we can all take pride in it, but, the Honey Moon is over.  China and India cannot still rely on the USA economy for its PRIMARY market place.  They have to raise their standard of living and quality of life to build their stability WITHIN their boundaries and sovereign nation.  That isn't easy with a billion people, but, it can happen and if done well it can happen quickly. 


If China and India 'find the guts' to build their own economies the demands for goods globally will go up and their people will become travelers and consumers no different than that of Europe and North America.  Russia is already under going that dynamic in its major cities, but, there are other problems in Russia and the climate is causing havoc within Russia.  The climate is also a huge issue in the USA, but, Republicans are DENIERS and won't deal with it effectively.  Why do down that road now, but, the states need to adopt policies that work for them in conjunction with The Clean Air Act and The Clean Water Act.  Those two legislative miracles 'link' the states in a unique way that if applied well will require all states to be concerned about their contribution to climate instability.

August 3, 2011
0100 gmt
USA Temperature Map


There is another 'heat bubble' forming.  The heat from the land actually contributes to the enlarging of the expanse of the air mass.


There is somewhat of a disturbing assessment in the Atlantic this hurricane season.  The storms in the Atlantic are encountering a lot of 'dry air' and not able to sustain their velocity because they loss their water vapor component.  That is why there isn't more high velocity storms to absorb some of this extraordinary heat into the oceans.  Not that it won't happen yet in a couple of weeks or so as the sun continues its southward movement, but, to realize the intensity of the heat of the planet in relation to the hurricanes in the Atlantic is to realize the severe heat stress it is under because of greenhouse gases.


This single fact is a global concern, not just the USA and must be addressed.  There is complete irrational behavior in the Republican Party in the USA so some kind of sanctions may have to be impressed if the USA does not come up with a climate policy at least at the 'state and local' level to stop this incredibly stupid manmade disaster.  

The Drought in the USA is now feeding itself.  The heat bubbles are self growth phenomena REINFORCED by its own physics 'over time' that then contributes to the next week of increased depth and range.


This is completely ridiculous.


At any rate, the global markets have to find a 'focus' that dictates stability in order to 'settle down' to a dull roar.  How that is going to happen might be dictated by 'minor economies' that rely on stable sources of support from the IMF.  I know that sounds counter intuitive, but, smaller economies IMPROVE as there is little else for them to do and their currencies begin to increase.  The more the currencies are viewed as 'stable' and 'a good place to hide' the sooner the rest of the economic dynamics of other countries can be MEASURED.  


What is the Rand doing?  I haven't look in a while.


The South African Rand is doing quite well.  Diamonds among other things the country mines continues to provide stability.  It is an amazing currency.  It took a little bit of a hit in 2008 simply because its economy is volatile by the assets it has.  In other words, when the global economy dropped, the diamonds became to risky an investment as they would not be purchased by consumers and therefore the Rand became more unstable.  But, that 'lack of confidence' in the Rand didn't last long (click here).  Cool.


It is that 'type' of stability the global markets should be seeking 'AS A MEASURE' to the success of recovering economies such as that of the USA and Europe.  History of a currency isn't necessarily the best measure to current conditions.


But, to find a 'point of reference' that provides insight to current conditions and potential for increased stability should prove to be a solace of one type or another.


It is easy to find comfort in metals as a 'safe haven.'  It is quite something else to find 'a personal quality' to lead in challenging times.  The current markets should not be concerned about the political nonsense existing in a populous party that may last a few election cycles.  It is normal for the USA.  I am confident President Obama and his cabinet have already had this discussion among themselves and 'the man' in the White House did exceptionally well in his negotiations and the Treasury Secretary learned never to change a 'date of decision' for the 'quality of the opposing political' leadership.


Good night and good luck.  


Be a bear. 


But.


Be a heroic bear.  


Please.

The Long Depression lasted from 1873 to 1896.

NPR did an audio about Jennings.  (click title to entry - thank you)


His proposed policy for STABILIZING the USA economy, once and for all, was to change the monetary standard from Gold to Silver.


That is how distraught the citizens of the USA had become.  They wanted a solution and they wanted it now.  Many were convinced Jennings had the answer, but, when it came to the actual vote, the Gold Standard won out at the ballot box.


Silver and Gold: Better baits for Investments ? (click here)

March 20, 2011

Silver gained nearly 2% and hovered near USD 35 an ounce ever since crisis crippled world’s third largest economy, Japan. During the same time Nikkei had tanked almost 10% and most other countries indices were affected.

Fundamentally, there are three main reasons which has been the price driver for silver: higher industrial demand, safe heaven for investment and supply dynamics. The industrial demand for previous year for silver was 48%. Peru, Mexico and China are the three main producers of silver. The total mine production has increased by 4% or 709.6 Moz (Million ounces) this year.  On the other hand the gold demand has risen by 3% this year.

The return of gold for a 4 year average period is 22.00% while that of silver is 25.44%. This has made silver more attractive as an investment than the gold. The retail investment in silver is increasing at a faster rate than the retail investment in gold. The truth is silver has certainly out shined gold.

Inflation in China as well as in India, who are the major consumers of precious metal, has been high. With such inflationary pressure, investor find their solace in Gold and Silver. Importantly, investment in silver has been high for the simple reason that silver is affordable as compared to gold....

Now there is a reason I referred to all this and I'll get to it in the next entry.

The Recession of 1893 was not completely dissimilar to that which we are facing today.

The Recession of 1893 was considered The Great Depression right up to the actual Great Depression that history now paints previous to WWII.


The recession of 1893, still today is called "The Long Depression" and resulted from a Railroad Bubble.


But, the Long Depression was sort of the 'last straw' for many Americans.  They had grown tired of impoverishment and the agricultural sector (the primary backbone of the USA economy at the time) was growing restless.


William Jennings Bryan came out as a result of "The Panic of 1893."  Twenty years after a previous severe recession.  People remembered the panic of 1873 and to face a long and lingering depression yet again was more than the agricultural sector could tolerate.  They wanted relief and 'by damn it' they were going to have it.  They wanted off the roller coaster.

The problem with these recessions is that they happened frequently.

Sometimes a generation seemed to be burdened with nothing but recession.  As a matter of fact the USA from 1864 to 2009 experienced 33 recessive cycles including the Great Depression.


The average contraction lasting 16 months.


The contraction began to diminish in its length to trough from onset as the yeas went by.  


From 1854 - 1919 (16 cycles)  the average contraction was 22 months.


From 1919 - 1945  ( 6 cycles) the average contraction was 18 months.


From 1945 - 2009 (11 cycles) the average contraction was 11 months.


You don't have to take my word for it, the link at the title to this entry has a graph I found interesting.

These are some of the "Trough Years" of the 1800 recessions in the USA.

December 1854



December 1858  - 18



June 1861  -  8



December 1867  -  32



The red numbers next to the date of the trough of the USA  



recession reflect the number of months it took to reach the trough


from the initial onset of the recession.


December 1870  -  18



March 1879  -  65



May 1885  -  38



April 1888  -  13



May 1891  -  10



June 1894  -  17



June 1897  -  18 


Many of these troughs and if looking to the Great Depression 


lead to the development of new populous parties in the USA. 


One might worry a great deal if such a 'manifestation' did not 


occur in the USA when the majority of the people were rattled 


to the core.

There have been many parties that have come and gone in the USA.

During 'tough times,' just like the one we are experiencing now there ALWAYS, without fail manifests a POPULOUS party.  In the time of William Jennings Bryan there was a very tough time and he became the focus of the Populous Movement in the late 1800s.  The 1890s to be exact.

What? Man from monkey? Bah. Humbug.

William Jennings Bryan was born in Salem, Illinois, on 19th March, 1860. He graduated from Illinois College in 1881 and after studying law in Chicago he practised law in Jacksonville and Nebraska before being elected to the US Congress in 1890. 

Bryan soon established himself as one of the nation's leading orators. A Democratic with progressive views, he supported campaigns for graduated income tax, regulating child labour and women's suffrage. Defeated in 1894 he was appointed editor of the Omaha World Herald before becoming the Democratic presidential candidate in 1896.

His Republican opponent, William McKinley argued for high protective tariffs on foreign goods. This message was popular with America's leading industrialists and with the support of Mark Hanna, McKinley was able to raise $3,500,000 for his campaign. Outspending Bryan by 20 to 1, McKinley easily defeated his opponent by an electoral vote of 271 to 176. Bryan also lost to Republican candidates in 1900 (William McKinley/Theodore Roosevelt) and 1908 (William H. Taft). 

In 1912 Theodore Roosevelt stood as the Progressive Party candidate against William H. Taft. This split the traditional Republican vote and enabled Woodrow Wilson, the Democratic candidate, to be elected. Wilson appointed Bryan as secretary of state. A passionate pacifist, Bryan convinced 31 nations to agree in principle to his proposal to accept a year's cooling-off period during political conflicts, allowing the dispute to be studied by an international commission. 

Anyone remember this guy other than me?

He was an attorney that made Nebraska his home.  With his wife Mary.


Not yet?


Here is one more clue.

In his first years in Lincoln, he traveled to Valentine, Nebraska on business where he met an aspiring young cattleman named James Dahlman. Over the next forty years they remained friends, with Dahlman carrying Nebraska for Bryan twice while he was state Democratic Party chairman. Even when Dahlman became closely associated with Omaha's vice elements, including the breweries, as the city's

 eight-term mayor, he and Bryan maintained a collegial relationship


People rarely refer to his run for the Presidency with affection because of the 'collateral damage' to the Gold Standard.

I was going to save this for the weekend, but, now might prove to be a better time.

For as much as the Tea Party likes to cling to history as its forte', it sadly is not especially in the venue of 'USA Economic History.'

Putin: DiCaprio is a real man!