Archive for the ‘just life’ Category

The Recession spelled Depression Part II

Friday, April 24th, 2009

Why is a Fed policy of almost 0% interest rate, and a $13 trillion bailout package not going to work?

Answer:

Because we broke the game.

When the market crashed, and real estate  continued to fall, the American consumer was faced with massive layoffs, and a dwindling net worth both in IRA’s 401K’s and value of their real estate and other tangible property.

Americans have begun to look at their new SUV every year, the $6000 vacations, and the garage and basements loaded with unwanted stuff , and have come to the realization  that they have too many possessions , and less and less money to pay for them. 

Consumers have stopped buying on credit, they are reducing debt at a record pace, and are saying no on new purchases.

The basic formula which has driven our economy for the better part of the last 60 years is grinding to a halt, and has begun to unravel at an increasingly rapid pace.

After WW II and well into the 50’s and 60’s, we were a nation conditioned to save.We increased our bank accounts on a regular basis, and the idea of credit cards and borrowing to purchase was approached with temerity.

We would spend our savings to raise our families, and  educate our children, We were a lender nation.

In the 70’s Nixon took us off the gold standard. Instead of being backed by gold reserves, our currency was backed by the promise  and faith of the government.

The recession in the 70’s , spurred on by OPEC, turned into the stagflation of the late 70’s. The government attempted to fight the recession with large spending, and massive(at that time) increases in the money supply.

The influx of newly printed cash into a stagnant economy resulted in massive inflation and interest rates in the upper teens and low 20’s

Reganomics and the increased intervention by the Fed under Volker and Greenspan turned us into a nation of borrowers and shoppers. .We became a debtor nation.

By the 90’s, we were spending more than we made, riding every economic bubble and market excess to new heights of deficit spending.

By the 00’s, we had stopped saving entirely, making shopping the national pastime .

Every recession has been cured with easy credit and the ever expanding money supply/

This never ending credit increase led to the creation of more and more insidious lending instruments, leveraging  our homes as engines for credit, and making it easier and easier to purchase our homes without ability to pay for them.

Part III to come.

Fat Louie, the Duck, Buys a New Home,a Parable about Risk and Responsibility

Thursday, February 19th, 2009

Fat Louie was a  fluffy white duck

He lived in an area east of Atlanta, known as Snapfinger Woods, which was comprised of Snapfinger Woods Estates, a converted rustic style apartment complex, and a man made pond known as Snapfinger Woods Lake.

Fat Louie had spent the first years of his life happily swimming and splashing in the pond. He was the biggest and fastest of the small flock of ducks, and soon became head duck .

The human residents of Snapfinger Woods took great joy in feeding Louie and his companions.  They would throw bread, cake, and other foods into the lake, and watch with glee as the ducks raced to be the first to reach the food.

Being the biggest and fastest, Louie usually got most of the food. He would eat, and eat,and eat some more.

One morning, Louie woke up with a constant throbbing pain in his right foot. He had developed the gout as a result of all the rich human foods which he was consuming.

The other ducks quickly rejected Louie as being defective, and a danger to the rest of the flock. They chased him out of the water, forcing him to waddle around on dry land.

Louie became Fat Louie, and most days he could be found waddling around the apartment complex ,limping on his bad foot.

Feeling sorry for the “poor” duck, the human residents showered Louie with  an array of rich human foods, which made the gout worse.

He was forced to sneak quick splashes in the water, hobbling in and out accompanied by  a great deal of squawking and quacking as the rest of the birds rushed to eject him from the pond.

That Spring was unusually rainy, and the small pond gradually overflowed its banks, The water ran down a slight incline, soon filling  a nearby  gully, and forming a tiny secondary pond.

” It is time for me to get my own home” Fat Louie thought to himself as he surveyed the newly formed mini pond.” I have some duck credits saved up. I think I’ll go to the Greater Atlanta Duck Association (GADA) to apply for Duck ownership to the new pond,’Louie’s Little Lake’, as he had already secretly named it.

Drexel Duck, chief real estate liaison between GADA and the general duck population, was a small grey duck. His down was carefully groomed, and his crown was fluffed to give him the appearance of additional height.

He gave Louie a disinterested stare.” So you want to purchase a residence.. From your application, this is a new construction, Unoccupied?”

Louie quacked “yes”.

” I also see that you have a  10% downe payment” He continued. ” and you want to apply for a Fowl loan for the balance.”

Again Fat Louie nodded his agreement.

Drexel paused for a moment.” I will give you a government acceptance voucher. You will have to pay a small fee and a 10 % gratuity for my trouble,” he held out his wing waiting to recieve his “payment”.

Realizing the way that government worked, Fat Louie slipped him a fat envelope.

Drexel glanced inside, seemed satisfied, then continued.” Take this voucher and go to the Greater Atlanta Fowl Realty Authority(GAFRA) They have mortgage money available for disadvantaged  low income fowl.

Fat Louie put down a deposit of 10% and was able to borrow the 90% at 6% interest on a 10 year mortgage.

Louie’s Little Lake belonged to Fat Louie. He quickly settled in, building a soft moss nest on the far end, near the wild grass which Fat Louie loved  so much.

Fat Louie had been on human, public dole so long that he forgot how to feed himself.So, every morning he would hobble over to the  apartment complex, hopeing to catch the big humans before work, and the smaller humans before school.

He would eat until he was ready to burst, then when all the humans were gone, he would return to his new home in the suburbs.

The following Spring into Summer, the rains stopped, and a drought soon developed. The heat of the summer sun caused many of the lakes and streams in the greater Atlanta area to dry up. Water levels fell , and Fat Louie’s new home gradually returned to its previous rocky  dry gully.

Fat Louie went to GAFRA, asking for help. ” My home  has dried up. I can’t live there any more. What should I do?”

Earl Grey, the loan officer in charge of GAFRA looked down his beak at Fat Louie.” What do you want me to do? Pay your mortgage .”

Earl Grey was a very large grey goose. He had stopped off in Atanta during a migration several years ago, and had found it much easier to stay and feed off the locals that it would be to continue the endless flying. Back and forth, north then south then north again.

” Haven’t you heard about our new leader?”Asked Earl Grey.” The ADDOP elected a grey goose as flock leader for the first time in history. The word is share the wealth. We are all brothers under the feathers.

“But my home is worth less than the money I owe. “Complaine Louie.”Why should I have to pay ?”

“Did we force you to purchase this property?Asked Earl Grey.

“Listen,” said Fat Louie. It is my right as a citizen of the common flock to get assistance from the American Democratic Duck  Open Party  .(ADDOP)

“Sorry, ” Replied Earl Grey, ” Due to the prolonged drought, we have allowed our brother birds, including Geese, Swans, and migratory flocks from across the border, to share our lakes and ponds. If you need assistance, get in line with the Illegal arrivals.”

” Quack, quack, o.k.”said Fat Louie.” In order to help my fellow ducks, I will also help the other birds, even though they don’t help us, or work for the common good.”

” That’s the spirit,” encouraged Earl Grey

As a good citizen of Duck, Fat Louie continued to pay his mortgage. The drought and the recession among humans caused many of the humans to move away. The Complex and Snapfinger Woods Lake became somewhat rundown, and more humans moved away.

With the humans leaving the easy food became more scarce, and Fat Louie was now sharing his wealth with  thousands of illegan birds from Mexico.

The good news is that Fat Louie lost weight due to scarcity.

His gout went away.

He met a pretty Daisy Duck, and  what happened next  is a story for another day.

Fat Louie, a Duck With Gout, a Parable about Fowl Health Care

Monday, February 16th, 2009

Louie was an old fat fluffy white duck.

He lived in a small private lake east of Atlanta. The lake was man made as an amenity for a small  condominium community of two story rustic wooden apartments, known as Snapfinger Woods Estates.

The Lake was appropriately named Snapfinger Woods Lake.

At one time, when Louie was younger, he was the head duck of the small flock which claimed Snapfinger Lake as their year round private residence.

During the Spring, the flock consisted of  12 - 14 adults, and would expand to 18 - 20 by the end of  Summer.As the young left during the Fall and Winter, the flock would settle back to the core members, looking to Louie for leadership and content with the easy life of  a controlled environment.

The human residents of Snapfinger Woods Apartments would regularly feed Louie and his flock. Children loved to throw bread and cake crumbs into the lake, laughing with glee as Louie and his companions raced to be the first to reach and consume the morsels.

Louie being the lead duck, was the strongest and fastest swimmer of the flock.

When the humans threw food into the lake, Louie was always the first to get there, and invariably, he would eat and eat and eat. Only when he was stuffed would the rest of the flock get a chance at the bread , cake, and other delicacies offered.

Louie loved to show off how fast he could swim.

As the seasons passed, Louie found himself growing older and fatter. He was consuming increasingly large quantities of human food, and his once sleek muscular body began to expand, turning to duck flab.

One morning Louie woke from a deep sleep, his right foot pulsing with a dull throb. He tried to ignore the pain, quacking loudly to let his human providers know  that he was awake and hungry.

He moved his webbed feet, as ducks do, to begin swimming, while flapping his wings for speed and stability.

The pain in his foot intensified to a steady throb, and Louie was forced to stop trying to swim.

The other drakes, noticing Louie’s plight, began quacking and swimming  in circles. When the humans threw food, they quickly chased after the breakfast, leaving Louie sitting dead in the water.

One human began throwing bread towards Louie  , attempting to help him get a chance at some food.

He slowly and painfully paddled towards the bread, but the other ducks seeing his movement, turned and headed towards the floating food.

First one  and then another of the young males bumped into Louie, roughly shoving him out of the way.

“Quack, Quack, you’re damaged. ” They shouted,” You get no food. Only healthy ducks get to stay with the flock.”

” Why?” croaked Louie, feeling hungry and somewhat frightened. ” I’m lead duck.”

” Not anymore,” They quacked in unison,” Damaged ducks can not be part of the flock, Haven’t you ever heard of Charles Darwin, or Survival of the fittest?  ”

Sadly, for the first time in his life, Louie felt alienated and alone.He had become a victim of his position of lead duck, He had been too good and too competitive. He had always  been first to get fed, earning human applause and rewards for being the best and the fastest.

Sadly, now, his reward for being  more successful and competitive  was a very painful case of the gout.

The other ducks had always resented his success.

Louie was forced to leave the pond which he had ruled for most of his life.

Louie was faced with the most humiliating punishment possible  for being a successful duck. He was banished from the flock and forced to live on land, painfully waddling along the edge of the lake, his gout swollen right foot, a symbol of his fall from mediocrity.

He went to the next flock meeting of the Greater Atlanta Duck Association(GADA) to ask for help.

A large Gander, with a very long neck and narrow  limpid brown eyes looked  down his beak at the obviosly uncomfortable Louie, balancing unsteadily on his good leg.

“Stand still and lower your eyes when addressing  GADA. ” He huffed with disdain. ” We have very limited resources to cure injured ducks, especially older fat ducks such as yourself.”

He paused, looking very annoyed that Louie had had the nerve to ask the council for a cure, “We find you too old. The cure will be too expensive and must be saved  for more worthy younger members of the flock. Henceforth you will be known as Fat Louie, and will be forced to live out the rest of your days on land, so as not to contaminate or hinder the rest of the masses.”

Fat Louie lived for several more seasons, largely at the largess of the human residents of Snapfinger Woods Apartments. His wealth and position was spread among the others in his pond.

Once again the system had worked. The good of the many superceded the good of the individual. 

When the humans took pity on Fat Louie and continued to feed him on land, many of them lost interest in the ducks still in the pond and ceased feeding them.

A human recession helped to bankrupt Snapfinger Estates, and  the complex was sold to a developer who drained the pond and built a small office building and parking lot where the pond had been.

Fat Louie continued to live on dry land and the secretaries took pity on the fat duck with the bad right foot, and continued to feed him cakes and cookies, until his death from escalated cholesterol several summers later.

Moral of the Story: Sometimes being the best and the fastest gets you promoted to your own exclusive club.

                                           And sometimes it’s a pain in the  . a..  foot.

O K We Have our first Black President, Now What

Wednesday, January 21st, 2009

Well O K , the excitement and novelty is over.

We now have our first Black President. Now what happens?

Will he walk on water?

Will he outhustle Magic Johnson on the B Ball court?

Will he restore World peace?

  Is the Recession over?

Is the U S Banking system stabilized yet?

How about our two wars. Are the troops home from Iraq yet? Have we killed or captured Binladen?

Whats takeing so long?

Where is the complaint department? Do I take a number or is this being run digitally?

The World has been led to believe that our new President is magic, oops, that can’t be, Magic’s last name is Johnson

Good luck Mr President, you’ll need it. You have the world convinced that you are the Messiah, what are you going to do for an encore.

What Can You Buy With $50000000000.00?

Tuesday, January 13th, 2009

With $50 billion what could you buy?

A beautiful pony

A Castle in the sky.

You would have power over people

Your influence would be second to only a mosque,church or steeple.

Who needs so much money?

The question is why.

How much is enough?

How much can you spend?

How much can you buy?

So get a ship not a boat

not a swimming pool but a moat.

You can afford to buy anything, and anything more

How about a Judge,

Your own country

Your own army

Your own general store.

The money that was stolen is so difficult to comprehend,

Who can count a number who’se zero’s never end.

Try to spend $14.4 trillion

All those zero’s makes my brain bend

144000000000.00

To All My Loyal Readers Thank You

Monday, January 5th, 2009

My Dear Friends,

I have been writing this blog for a little over a year.

I am not very Internet savy, so what ever promotional things people normally do to get attention on the Internet…I did none of them, at least not intentionally.

Ipso Facto(I hope I spelled it correctly)  You must find me entertaining , informative, and I’m helping in some way.

At the beginning of what is sure to be a difficult year, I just wanted to say thank you.

Thank you for being loyal.

Thank you for getting it.

If any of you have any comments or questions.. Please ask.

You are family, or at least friends.

Happy Healthy New Year.

I’ll do my best to help.

Love You All

The Relationship of Economics to History

Sunday, January 4th, 2009

Economics is a way of keeping score.

Economics is the way we are able to feed ourselves.

Economics is the engine that drives history.

The quest for quantitative gain, either in wealth or sustenance has been the propellant for most wars,  the march of  invading armies, and the annexation of  neighbors lands.

Economics is the fuel which drives society.

From the beginning of human history, people banded together first in clans, and ultimately in tribes and later nations, all with the original need to feed and protect.

To control the source of food and to allocate its distribution was an economic power that could decided life and death.

As society evolved, the symbiotic relationship  economics and history strengthened.

Today, the state of our economy has once again devolved to a more basic level. The days of indiscriminate spending on increasingly absurd possessions are fast disappearing.

Now we have turned into a dependent society.

We expect to be taken care of,,

Thank god for Obama and his Progressive minions.

Our needs are no longer our responsibility.

Pay my heating bills.

Buy my food.

Provide my health care.

Subsidize my rent.

Pay me not to work.

etal……

Deflationary Spiral, Are the Bailouts Working?Obama and F D R

Sunday, December 28th, 2008

We have been told many times in the past 6 months, that this is the worst financial crisis since the Great Depression.

As the popular story goes,  the market crash of 1929 , was the result of a failure in our free market system. We were saved from total devistation and massive unemployment, by the gallant dramatic intervention of President Franklin D, Roosevelt , and the creative innovations of his New Deal policies,.

This fairy tale has been repeated for decades, lauding Roosevelts bold moves, and the rescue provided by his Democratic Party.

In the light of the current economic crisis,this is an Urban Legend which must be examined.

After the market crashed in October 1929, economic activity slowed down as would be expected . A crashing Dow Jones is an obvious ,in your face ,sign of economic distress.

A speculative bubble had burst, and a recession was being announced. 

In a recent article by Thomas  Sowell  he quotes unemployment statistics from a Vedder and Gallaway book, “Out of Work”. This enables us to follow unemployment statistics for the early years of the Great Depression.

The numbers are very telling. In November 1929 the unemployment rate was 5 percent. By December of that year unemployment had spiked to 9 percent.

Between December 1929 and June 1930, unemployment had dipped to 6.3 percent . A good healthy recession was  developing, but not the Depression which was to come.

What turned the Recession into a Depression?

In June 1930, Congress passed the Smoot- Hawley tariff act, in an attempt to protect American jobs, by restricting imports.

Within 5 months,the unemployment rate  had jumped to over 10 percent.

This initial tampering with the economy was followed by a series of  escalating, increasingly desperate

 stimulus packages, eventually turning into FDR’s New Deal.

Public Works projects, the TVA, and a torrent of additional spending stimuli, transferred wealth from the private sector to the public sector, with the Government becoming our largest employer.

All of this redistribution and publick works stimuli resulted in an unemployment rate above 20 percent for for more than 3 years beginning in February 1932.

Throwing money at a recession by providing publick works jobs does not work.

Classic Big Government spending, even in massive record amounts did not work in the 1930’s.

A similar attempt to control recession by stimulating  inflation during the 1970’s engendered a decade long Stagflation.

President Elect Obama’s stated intention of providing a MASSIVE stimulus package to save the economy, sounds uncomfortably similar to FDR when he came into power.

Blaming all of this new spending upon his predecesors failings, parallels previous political expediency.

Overlooking the real cause of the problem, and  choosing to ignore the lessons of history are short sighted and dangerous .

The Stock Market Crash of 1929 did not cause the suffering and unemployment of the next 7 or 8 years. Roosevelts tinkering with the economy and the massive Government intervention  was what depressed the economy.

Take money out of the private sector and redistribute it to the population through stimulus employment, takes a pie that is already shrinking and gives it out to hungry people, but now there is no more pie, and the company that baked the pie has been  taxed out of business.

Let Them Eat Cake!!!

Next: Recession, Stagflation, Depression, what great choices.

Holiday Season 2008, the end of an Era?

Thursday, December 25th, 2008

The new world is dawning.

Not a pretty sight,but a realistic look at our future.

We are just beginning to see the wheels come off our bus

.The undercurrent of sentiment is becoming a  torrent of resignation.

” Things are bad, and they are going to get much worse. “I hear these phrases uttered several  times a day.

” They aren’t going to get better any time soon.”

” Get used to difficult times. ”

“The good old days are gone.”

The Bernard Madoff rip off and scandal was the final nail in the coffin of public sentiment.

The American people are  overdosed on traumatic events and failing institutions.

Our leaders lie to us.

Out banks have failed.

We find that our respected friends are nothing more than master con men.

We are Americans!

Citizens of the greatest country on Earth!

This is not supposed to happen to us.

We have been sold out by our leaders for 30 pieces of  silver.

We are too shell shocked to get angry.

…….so far…….

A Hippie on Wall Street an Excerpt from Charlie Champion the Story

Monday, December 15th, 2008

                              This is an excerpt  from a fromnovel                                                                 The Life and Times of the Fabulous   Charlie Champion                                                         A Hippie on Wall Street        I have released only a very few excerpts from  this novel..                 It is a work in progress,However, current events regarding Bernard L Madoff(O T C ) trader. . In the days before computers, that was a very different profession.In 1966 there was no NASDAQ , no  modern computerized instant  access internet No knowledge and information technology that exists today.                In the Spring of 1966, I was a 20 year old Junior at Hobart College, and had recently reconnected with  my highschool sweetheart, Janet.                 I had met Janet’s Uncle,” Marty”, the previous Christmas, at his New Years Day house party.                 Marty was in his late thirties,  short, maybe 5 ‘ 9″, wirey and very active physically, with a highly intelligent mind ,quick wit, and an intense sharp  tongue. He had thinning black hair and wore thick glasses. He had always distantly reminded me of Woody Allen , both in stature and persona.                 He was a truly strange  man,  difficult to get close to, but very likeable  . His intensity was tempered by his wry sense of humor , and enabled him to define his personal space.                 Several years earlier, Marty had  decided to go into business ,opening  his own OTC tradeing house..Joel J Martin & Co.They were professional market makers and traders, utilizing the pink sheets, and a World Wide network of friends and competitors, via telephone, telex, and wires.                 Marty,  In order to reduce expenses while his new company was getting established, shared office space and the company back office, with a friend and fellow trading professional .Bernard Madoff.                   Bernard L Madoff  and Co had been a successful 1 man trading company since the early 60’s, and Bernie and Marty had become friends and  fellow market makers while Marty was training and working at Jersey City trading house,  M S Wein & Co.                 Since they were both one man trading firms, it was a natural fit for them to share an office, telephone systems  and back office personnel. Having another professional trader made work easier for both men.                  Through Janet, Marty asked if I would be interested in a Summer job after the end of Spring semester..                The opportunity to learn about Wall Street was exciting, and I gladly accepted.                                                                            *                           *                     *                The offices were located at 39 Broadway, on the 12th floor.                 Like a tourist I stopped in front of the building and looked up .              “ Well here goes, “ I thought with a touch of excitement.                   As  I walked down the hallway ,the echo of my shoes on the polished terrazzo floor sounded loud in my ears. This was the financial capital of the World.                  I was being introduced to ” The Street” .The energy of the place vibrated in the air.I was very excited, but had the self confidence that came with my youth and inexperience.                  As I approached the frosted glass doors, I stopped and tugged nervously at my tie.  Bernard L Madoff & Associates was printed on top, Joel J Martin & Co. was below. Underneath there was a large gold leaf arrow pointing down the hall. Cashier was in black block letters at the bottom.                  I ran my fingers through my long brown hair, patting it into place. I brushed at my slightly rumpled sport coat, then pushed at the door.                 The reception room was modest in size and content. A small glass top table served as a desk. There was a plush brown leather couch, and a matching easy chair with a low coffee table in front. On the edge were copies  of the New York Times, the Wall Street Journal, and  Barrons.                  The room was empty,. I could hear a mans voice say something muffled, and the sound of laughter echoed from an open door to my left. “ Hey Joey, how about putting on some coffee. My coffee tastes like mud.”                 I glanced at my watch. 8:45. I’m on time. “ Hello “ I called out. “I’m looking for Joel Martin”                 The voices went silent. “ Hi can I help you? “ The man walking through the door was slight in stature . He had an olive complexion  and his  black hair was combed neatly to one side. He was clean shaved, and his dark eyes seemed to sparkle as he crossed to room.                 “ You must be Charlie Champion.” He smiled and the room seemi