Saturday, February 28, 2009

Lack of competing sticks makes the single stick more valuable

   Here we are folks, Economics-101, yea, you should have paid attention in class and studied when you had the chance.  Kondratiew aka: Kondratieff and Schumpeter.  A couple of really heavy duty dudes that produced tremendous results in later years, and most people are unsure of who these two were.  Joseph Schumpeter gave us creative destruction and the beginning of capitalism.  Sort of like he defined America.  Kondratieff gave us cycles, big 50-60 year cycles, smaller cycles, business cycles versus economy cycles.  The Soviets did not like his words and locked him away.  And not many people know who they were.  Well no one knew who Genghis Khan was or what a Mongol was until .....  

     Booms and Bursts:

  Tulip mania about 1630.  Someone sold a tulip, that was sold again for a profit, and again and again.  Next thing you know the damn tulips are being planted and raised and sold by everyone.  A country ended up as the tulip country.  Had to grown them in green houses, they would not grow outside.  Then something hit the fan, someone said we don't need all these tulips, they are not worth what they are selling for and they sell for much more than their cost.  The bubble burst.

   California Gold Rush of 1840s-1850s, town after town after town appeared in California and that part of the west.  Then someone said we don't need all these towns because the gold is running out.  The bubble burst.

  Dot-com bubble, the crash of 1929, and then (you may want to put your reading glasses on now) the American sub prime mortgage boom of the 1990s, and then, and then, the early 2000s, and again about 2006, and just keep reading into the future.....and hearing pop, pop, pop....  There are a lot of others, different products, different times, same attitude and mentality.  

  A tulip, a house, a boom town, a housing development boom in Florida circa 1900, 1920, 1990, 2000++.  My theory is that people and companies learn nothing until after they lose money, before that they are reacting, following the herd.  Like a herd of Angus moving across the pasture thinking that the rest of the herd knows what is going on, and a lot of other follower types.  Look up the definition of "lemming".  Depending on the book, you will find words like "unthinkingly, headlong rush, flailing", and I'll be dammed, some books throw in "Wall Street.

  This part of our current cycle is heading down.  Not much can be done about it (the direction) except - make it worse. Do more of what got us into this.  Spend, Spend, Spend.  The government is asking the citizens of America to stop saving and start spending, develop more credit.  Bad, Bad, Bad.  


The view from the pasture is to live within our means, and that probably means reducing your spending, your cost, your consumption.  These are all good things, nothing bad about them.  Your elected government will spend your descent's money, and they will also spend and destroy your descent's credit.  Not "your children mind you, but your descents".  A long time to suffer, and for what ? ? ? ?

 

Tuesday, February 24, 2009

Pilot Training to BUFF



FLYING IS A DIFFERENT LIFE:

There I was, pointed at the ground and pulling hard, 20,000 feet from 1 g to 6 g and there goes Oklahoma being pulled to beneath my feet, there goes Texas, falling below my vision, now blue, blue sky, no horizon, blue sky, white blob of a cloud here and there, no navigational aid there, now all I have is 6 g and wings level on ADI, and that is hard to do looking out at the Sun, that damn sun moves, left-right-east-west, I have heard even north-south, lookie, lookie, from above my head, here comes the horizon, and that must be Kansas that appears from above my head, and I hope that is Dorothy and Toto out there somewhere, the horizon checks with the ADI as to wings level, hang on to that 6 g meter, pull, pull, pull, lord I hope that is Kansas and not Colorado or Arkansas, that I am pulling down into my view from over my head, and now Oklahoma, the pitot tube and my toes are pointed thru the air towards the ground and pulling down from over my head comes another verison of the sky above Oklahoma and Texas, I hope, I hope, I hope, and I hope to get back to Enid tonight. Sun so bright and sky so clear that I can see into the future. TACAN needle points left and I be headed south, God is good and it is nice when things check, roll left and call inbound, life was good there in the plains of the western part of the mid-west. A year in Oklahoma. a year not in Vietnam, life was good to me, Sandra was good to me, God was good to me, even the Air Force was good to me.




Monday, February 23, 2009

HISTORY TEACHES TRUTH. HISTORY TEACHES LIES.

History teaches us. It teaches us the truth and it teaches us the lies. We can not tell the difference.

About a long long time ago, in a college course, I learned that history could be used to support either or both sides of things. They gave an old statistical example, now modified by the pasture preacher(me):

Consider how many people die in America everyday. Death is evident, death is certain, death is a fact, and death is obvious even to our government regulators. Now consider a 93 year old man. He has never ever died, never before. When he does die, our government regulators (of the banks, of the stock exchange, of the fannies and freddies), and all our talking heads on the business channels, they all say "no one saw it coming, no one knew that he would die, he has never died before, no one could have predicted his death". The choir sings and the pasture preacher says "Bubble don't fail me now".

Now the pasture preacher contends, everybody knew that the markets (housing market, stock market, credit market) were over inflated, everybody knew that the markets were in a bubble state, everybody knew that the bubbles would burst. We did not know when, we did not know at what limit. No one wanted to sound the alarm. Not as long as the other guy appeared to be making money. No one wanted to be the one to sound the alarm, to make the cry "the king has no clothes on". They did not want to say it, but every one knew that the bubble would burst.

Now the government plan is to expand those bubbles again. Expand them more this time. Create more bad credit, create more bad debt, spend more money that we do not have. But this time we will let government regulators monitor these things. Yep, you guessed it, the same government regulators who could not have predicted the old mans death. The same regulators who never saw anything coming. The choir sings "gimme that old time religion" while the pasture preacher sings: "gimme that old time regulator, gimme that old time regulator..."

They gave the banks a lot of money and they do not know what the banks did with the money. They gave them no restrictions or requirements on the money. The banks took the money. The banks are not making loans. The banks are not stupid, it was bad loans that got them into this. The banks want more money.  They can sit on it until the economy turns around and then they will have a cow patty pot full to work with.

There is an overall common thread that runs through out this whole financial fiasco. It was all based upon dreams, it was all base upon hope and upon promises. Paper profits. Nothing was based upon value. No one bought real stuff, or real things. Futures, leverage, and other names that no one knew what they meant, names that were made up. Promises in the wind.  Frame work provided by the US government.

The choir sings and the pasture preacher says:
The preacher said he could make them whole again
The salesman said he could make them rich
Cohen said:
Everybody knew
Everybody knew the boat was leaking
Everybody knew the captain lied.

Friday, February 20, 2009

Politician's Entrance Test

WARNING

You will be tested prior to being allowed to run for a political office. Study the following very hard. The standard is 100 %.


The Seven Principles of Sleight of Hand are:
1. Palm - To hold an object in an apparently empty hand.
2. Ditch - To secretly dispose of an unneeded object.
3. Steal - To secretly obtain a needed object.
4. Load - To secretly move an object to where it is needed.
5. Simulation - To give the impression that something that has not happened, has.
6. Misdirection - To lead attention away from a secret move.
7. Switch - To secretly exchange one object for another.
"http://en.wikpedia.org/w/index/php">

Now on to matters in another pasture.  Our fearless leaders (I submit we call them our fearless spenders) are off to Italy at $10,000.00 per hour and at tax payers expense.  That is not appropriate for someone that feigned withholding money because they came to pickup their government welfare checks riding in their private jets.

Wednesday, February 11, 2009

Puzzle, Texas, Got Milk



There I was, trying to be invisible, not involved, not stressed out, having nothing to do.  That being the dream of an old man.  There he was, brownish red with white face, in a herd of black angus, sleeping, up against the barn.  Not normal, very unusual.  After a close look, my old dairy mentality told me that he had come up to report his pending death.  Starvation, related to the Mother not being able to provide the basics of life.  My bad side said, walk away, come back later with a shovel, and my good side said, we need to confront the problem.  Tell the wife, boss, farm manager, that we needed to go see the vet.  Pickup the brownish red baby with white face and slide him into the rear seat of the truck, and drive to the vet.  Vet said: do this, do that, and do other stuff.  Bottom line is/was, tube down the throat and into the stomach (keep fingers cross that you miss the lungs), pour the stuff of life.  It will work, or you go get the shovel.  There are good stuffs in this world folks.  He (the bull-now tagged with "puzzle, texas, got milk") was waddling around the pasture and quickly formed a very strong attachment to the wife, boss, farm manager (see above), and now "holder of the bottle with nipple and milk substitute", so strong that he would run across the pasture anytime that he had an indication that she was home (I belive that he could identify her car tag number).  He would come to me, only if "she" was not around.  So many hours of bottle feeding in the early, cold, damp and foggy mornings, and late dark nights after work.  He lived, he flourished, he became what he was, a very large bull, about the size of a Toyota truck, not those tiny things.  He turned into a "real man", he started to travel about.  Not only our pasture, fences being what they are, or rather what they are not, he visited our neighbor's pasture.  She, not wanting her herd bred, but puzzle felt that he knew better.  Today, puzzle has been sold, hopefully to someone with a big pasture and a tall fence.  Our neighbor has four new calves that bear the markings of puzzle.  We have 5 new calves that bear the markings of puzzle.  Life is good, life goes on, here in the pasture.


I feel this nation of ours is sick, ready to report its impending death.  Related to not being able to obtain the basics of life, but actually, strong and willing to recover.  We need to stop our elected offficials from using the shovel and covering us up with more debt.  Debt that they all say is what created this problem.  Debt that they say is what will get us out of this problem.  My old dairy mentality leads me to beleive that this problem was created by a market that was mauled into a position of "not normal, very unusual".  And I say the market can adjust itself.  We need to give it a chance to do that.  We need to resist the temptation to pile more debt upon debt.  Money wise, we are beyond bankrupt.  Legally our government can declare whatever they wish to declare.  As long as someone out there is willing to "not call in our loans", we can continue to operate, print money, pile up debt.  This places our future in someone elses hands.  Do not doubt that we are bankrupt.  Do not doubt that we can recover.  Do not doubt that we need to control the basic instinct of our elected officials to throw our money to the people that finances their election/relection.


Monday, February 9, 2009

Miracle on the Hudson, follow up


Miracle on the Hudson, follow up:  While standing in the pasture under a full moon, I see cows chew hay, calves rub heads, run, buck, and throw hooves into the air, and I imagine that Oprah will interview on her show, all the surviving birds of this highly publicized incident (Miracle on the Hudson).  This is a must for all bird lovers, all bird haters, all aircraft engine mechanics, and especially all birds.  General Electric, Boeing, and Rolls Royce are all making large investments to advertising on this show.   If we advertise, they will buy.  If we sell, they will buy.  If they do not buy, we will give them your money and make them buy.

Buy America:  no more plane flights and vacations to Europe, Asia, or any where else not in the Continental US, no more cruise ships.  Buy America. Be prepared to subsidize the airlines, and the cruise ship lines.

God Bless America and Capitalism, hello Socialism.  

Wednesday, February 4, 2009

Any wonder we have problems dealing with the world and understanding how things work ?

There are only a few things in the world that affect absolutely everyone. Chemistry, Physics, Economics, and to a lot of people religion and faith. Our schools do not teach religion and that is understandable. We decided a long time ago that we did not want someone else's religion driven down our throats (freedom of religion is freedom from religion). Our high schools are set up to teach chemistry and physics only to college bound students. A lot of college degrees do not require the study of chemistry, physics or economics.

If we expect our population to understand the world they live in and to deal with life effectively, we should provide a foundation of knowledge that includes the chemistry, physics, and economics, from the early beginning and into college.

No wonder we have problems dealing with the world and understanding how things work ?

Sunday, February 1, 2009

Why 32 F

The weather was cold this morning.  The cats wanted in last night, they wanted out this morning but right back in.  The dogs did not  show any indication of wanting to wander around the pasture.  They lay on the rugs and took very slow and loud breaths.  In my effort to delay going outside in the cold I decided to check the weather in places of interest to me.  Sembach Germany was 32 F, Chelsea, Alabama was 32 F, Bushnell, Florida was 32 F.    My cold brain said: whats going on here?  is the entire world 32 F, is this some form of global warming? (global cooling in Florida).  The neighbor says it colder than that.  It always is in his pasture.  Just an odd fact of life in  the pasture.