“Soft despotism is a term coined by Alexis de Tocqueville describing the state into which a country overrun by "a network of small complicated rules" might degrade. Soft despotism is different from despotism (also called 'hard despotism') in the sense that it is not obvious to the people."

Sunday, October 26, 2008

Now it is the Hedge Funds. "One of the greatest fiascos of banking in 100 years"

Some very bleak words from the Telegraph. It was a momentous calamity allowing the US home market to fall into bankruptcy and expecting a market solution of "letting them get their just desserts" as a policy. Some of us warned that the housing collapse should be contained but it wasn't and the consequences are becoming frightening. A policy of allowing bankruptcy courts to reset mortgages was sound then and probably the last line of defense now. This is a time for bold leadership without regard for public opinion, but we are reaching a point of no return.


GLG chief Emmanuel Roman warns thousands of hedge funds on brink of failure
Emmanuel Roman, the co-chief executive of Europe’s biggest hedge fund GLG, has warned that thousands of hedge funds are on the brink of failure as the global economy contracts with unexpected severity.

By Rowena Mason Telegraph

Last Updated: 5:50PM BST 24 Oct 2008

Emmanuel Roman, of GLG Partners, said 25pc-30pc of the world’s 8,000 hedge funds would disappear "in a Darwinian process", either going bust or deciding meagre profits are not worth their efforts.

"This will go down in the history books as one of the greatest fiascos of banking in 100 years," said Mr Roman, who with Noam Gottesman, co-runs GLG, a former division of Lehman Brothers Holdings with assets of $24bn (£14.8bn). "There need to be some scapegoats, and the regulators are going to go hunt people. That will be good in the long run."

His views were echoed by Professor Nouriel Roubini, a former US Treasury and presidential adviser known for his accurate prediction of financial crises, who estimated that up to 500 hedge funds would fail within months.

Both men were speaking at the same hedge fund conference in London yesterday, and Prof Roubini said he would not be surprised if the US and other countries soon had to close their stock markets for more than a week to halt descent into "sheer panic".

The economist warned that the world is heading for a protracted recession that will end the US’s financial dominance.

"It’s the beginning of the decline of the US financial empire. The Great Depression ended in a massive war. I hope that’s not going to happen but it’s pretty ugly now," Prof Roubini said.

He added that turmoil over world trade, currency markets and debt is likely to cause geopolitical tensions between the Western world and emerging superpowers such as Russia, China and "a bunch of unstable oil states".

The conference saw analysts, economists and hedge fund managers discussing the possibility that global recession could now last two years on fears that government bail-outs and nationalisations have failed to stop the markets slumping.

"We’re now paying the price for the biggest asset and credit bubble in history," Prof Roubini said, advising investors to stay clear of risky assets and keep money in cash. "The bail-outs have not worked because the markets are no longer rallying, and the policy-makers have run out of options.
The global financial meltdown accelerated this month, with the UK and US governments being forced to take stakes in some of the world’s biggest banks. Stock markets around the world have fallen sharply this month as investors’ concern switches to the impact on the wider economy.

"It’s like we’re walking blind in a minefield," said Prof Roubini. "Every situation has become risky and no one can trust each other. The banks are too big to be allowed to fail, but they’re also too big to save."

Research from Hedge Fund Intelligence (HFI) shows that despite one of the worst months on record for credit funds, US hedge funds alone still have $1.7trillion (£1trillion) in assets.


  1. Dick Morris thinks that if the Joe the Plumber ads are going to have any effect it will begin to show up Monday, Tuesday, Wednesday. If there is some validity to the idea that the stock market is tracking the possibility of an Obama win, watch those polls next week and the market.

    As for me, I got a Happy Birthday card from my bank Saturday, signed by all the first floor employees.

    Banking you can trust.

    The managers upstairs may have left for the Bahamas.

  2. It may be time to go shoot some deer for the freezer.

  3. Is that a picture of the Dorians Gray on Drudge, or what? Spooky.

  4. NEW YORK (AP) - The Star-Ledger of Newark, N.J., will reduce its newsroom staff by nearly half through voluntary buyouts as New Jersey's largest newspaper seeks to return to profitability.
    Jim Willse, the Star-Ledger's editor, said Friday that the newspaper accepted 151 buyout offers from its news staff, or about 45 percent of its 334 editorial employees. He said 17 buyout applications were rejected.

    Some staffers already have left, and others are leaving by year's end, many after the elections.

    "We've got from now to the end of the year to figure out what adjustments we have to make," Willse said. "We will be able to produce an abundance of good stories. We will still have a good paper but we have to figure out exactly how to accomplish that."

    The number of buyouts accepted outside the newsroom was not immediately known. The newspaper had sought at least 200 total, out of 750 full-time, nonunion workers, and received more than enough applications.

    Two unions agreed to another 120 buyouts combined.

    The Star-Ledger, with daily circulation of about 350,000, has posted losses for at least three straight years and was on pace to lose between $30 million and $40 million in 2008. The newspaper won union concessions and enough voluntary buyout applications from nonunion employees to lift a threatened sale or closure by January.

  5. The sheer mass of Obama's ad buys, bob, will overwhelm Joe the Plumber. Little doubt of that.

    He'll find no traction.

    They had Mrs Palin in Iowa, yesterday.

    From the tactical actions of Team Maverick, they are not trying to win.
    Sending Sarah to Iowa, of all places.

  6. Faith, hope, and charity" are Christ's things. They apply, properly, outside time -- to a "futurity" that is not of this world. They must not be applied to any earthly utopia. A Caesar who appropriates otherworldly virtues, is riding upon very dangerous illusions. Follow him into dreamland, and you'll be lucky to wake up.

    Messianic Pretensions

    Kind of article I like a lot.

  7. Doesn't make much sense, though the report from the McCain camp was things were closer than the polling. What about Missouri, Ohio, Florida?


    Rufus says he's McCrazy.

  8. In the secular society, bob,
    "Faith, Hope, and Charity"
    are the providence of Government.

    A thousand points of Federally funded charitable light.

    The label on the collar does not change the cut of the suit.

  9. The key State is Colorado, then Virgina, New Mexico.

    Assuming Maverick can hold Florida, Missouri and Indiana

    With ten days left, why waste Sarah's new wardrome in Iowa?
    Maybe she's helping a Congressman survive.

  10. That's an idea, helping a Congressman survive.

    Poor old Sarah. Biden funnels two million to his family, from campaign funds, and she gets criticized for wearing some new clothes owned by the Republican National Committee, and she shops at Wal-Mart, too.

  11. The lesson there, bob ...

    Stay true to yourself.

    Maybe it's the handlers or maybe she did show her true self.

    They should have gone to Walmart, with $5,000, or less.
    Made a big show of it, not to 5th Ave in NYCity and spend $150,000.

    With only duece and trish making note of it, even caring.

  12. dRat,

    Don't know if you've caught it, by I solved your A/C complaint.

    Google: Passivhaus

  13. Biden/Murtha opening skit on SNL last night was absolutely hilarious. If you didn't see it, can probably find it at or on youtube. Good stuff.

  14. Gird thy loin, and check the trigger string on thy shotgun.

  15. Here's a real screamer from SNL as Biden and Murtha compete to unelect obama

  16. Whit you beat me to it.

    Think this one is going to go viral?

  17. My understanding of Hedge funds is that they primarily goose their returns by operating heavily leveraged. I think that much of the turmoil we've seen in the equity markets has been because hedge funds have been forced to unwind many of their positions. The 1.7 trillion dollars of assets mentioned in that article, I don't believe, is very relevant. What is relevant is the amount of leverage still outstanding. As long as the hedge funds meet their margin calls then it's primarily the rich investors who tried to juice returns through the funds that will suffer. So, in short, I think most of the carnage due to hedge funds is done already and what remains will be born by the investors in those funds. Personall, I think there still remains a lot of risk due to the all the Leveraged Buyouts that occurred over the last decade plus. The purchasers of Intrawest being an example of the problems left over from that form of corporate pillage. Basically a firm is purchase throught the use of leverage and the LBO team runs with their bags of money while the LBO'd firm is saddled with massive debt. Intrawest was purchased by Fortress this way and struggled for about 8 months to come up with a refinancing deal (I'm working from memory here so the details could be wrong) and they only managed to come up with a refin deal 2 hours before the deadline. They refused to reveal the terms of the deal.

  18. p.s. Intrawest is a very well managed company with a lot of good revenue producing assets. Unfortunately the revenues may not be enough to support the debt they are now saddled with.

  19. Plasma TVs Draw More Juice from Grid than Plug-In Vehicles
    by Michael Graham Richard, Gatineau, Canada on 07.24.08

    Plasma TVs vs. Plug-In Cars

    We already wrote about a study by Oak Ridge National Laboratory that shows that plug-in cars might not need new power plants (or few of them), and now we learn that a big screen plasma TV actually drains more power from the grid than a plug-in.

    "Plasma TVs, industry officials say, consume about four times the electricity as recharging a plug-in hybrid. Yet utilities have managed to cope with the increased loads as thousands of new televisions came on line."

  20. Hedge funds are just rich folks, gamblin. No big deal.

    The problem, right now, is European Banks. They're in pretty deep doo-doo it looks like.

    Then come the "East" European Banks. Really, really deep shit. Which ones can we let fail? Big Question. Big Problem.

    Global trade can't be "unsnarled" until lines of credit from European banks are trusted. Dicey.

  21. Speaking of Change: All the lefties want change. If they get the presidency and congress, I have one change that I would like to give them. I will encourage every young person I know not to join the military.

    Frank wants to cut the military 25%. Obama wants to make community service equivalent to military service. The left hates the military in general, and they have no real respect for those that have served, so let's flip things around. Encourage young conservative people to become teachers and community organizers. Let the Democrats and the Left have to resort to the draft.

    For a change, give the Left and the liberals a real change and allow them to serve their country and causes.

  22. Yves at


    the analysis penned by Ambrose Evans-Pritchard is what really caught my eye. He makes the case for us to worry about a full-scale currency crisis worse than the 1931 currency crisis of the Great Depression. The link: Bank credit. You can think of Sweden in the Baltics, Austria in Central Europe, Spain in Latin America -- and you begin to picture the interconnectedness that will imperil Europe's banking system much more than either Japan's or America's:

    The financial crisis spreading like wildfire across the former Soviet bloc threatens to set off a second and more dangerous banking crisis in Western Europe, tipping the whole Continent into a fully-fledged economic slump...

    Experts fear the mayhem may soon trigger a chain reaction within the eurozone itself. The risk is a surge in capital flight from Austria – the country, as it happens, that set off the global banking collapse of May 1931 when Credit-Anstalt went down – and from a string of Club Med countries that rely on foreign funding to cover huge current account deficits.

    The latest data from the Bank for International Settlements shows that Western European banks hold almost all the exposure to the emerging market bubble, now busting with spectacular effect.

    They account for three-quarters of the total $4.7 trillion £2.96 trillion) in cross-border bank loans to Eastern Europe, Latin America and emerging Asia extended during the global credit boom – a sum that vastly exceeds the scale of both the US sub-prime and Alt-A debacles.

    Europe has already had its first foretaste of what this may mean. Iceland’s demise has left them nursing likely losses of $74bn (£47bn). The Germans have lost $22bn.

    Stephen Jen, currency chief at Morgan Stanley, says the emerging market crash is a vastly underestimated risk. It threatens to become “the second epicentre of the global financial crisis”, this time unfolding in Europe rather than America.

    Austria’s bank exposure to emerging markets is equal to 85pc of GDP – with a heavy concentration in Hungary, Ukraine, and Serbia – all now queuing up (with Belarus) for rescue packages from the International Monetary Fund.

    Exposure is 50pc of GDP for Switzerland, 25pc for Sweden, 24pc for the UK, and 23pc for Spain. The US figure is just 4pc. America is the staid old lady in this drama.

    Amazingly, Spanish banks alone have lent $316bn to Latin America, almost twice the lending by all US banks combined ($172bn) to what was once the US backyard. Hence the growing doubts about the health of Spain’s financial system – already under stress from its own property crash – as Argentina spirals towards another default, and Brazil’s currency, bonds and stocks all go into freefall.

    Broadly speaking, the US and Japan sat out the emerging market credit boom. The lending spree has been a European play – often using dollar balance sheets, adding another ugly twist as global “deleveraging” causes the dollar to rocket. Nowhere has this been more extreme than in the ex-Soviet bloc.

    The region has borrowed $1.6 trillion in dollars, euros, and Swiss francs. A few dare-devil homeowners in Hungary and Latvia took out mortgages in Japanese yen. They have just suffered a 40pc rise in their debt since July. Nobody warned them what happens when the Japanese carry trade goes into brutal reverse, as it does when the cycle turns.

    When the markets open on Monday, I expect the crisis in Emerging markets to take top priority. Iceland was the first victim of this crisis. The dreadful events there should be a warning to policy makers to address this now or else we could see some awful writedowns at European institutions in the very near future -- not to mention the potential economic destruction this turmoil could cause.

    Yves again. Now the meltdown may resume Monday, but another scenario may play out. Recall 40 nations (EU and Asian) met in Beijing over the weekend, endorsing Nicolas Sarkozy's call for a revamping of international banking regulations and more coordinated, tougher supervision. None of this directly addresses the looming currency crisis, but the markets sold off badly Friday, and if there is any stabilization or reversion on Monday, the backing away from the abyss plus the hope that the next phase of meetings, scheduled for November 15 in Washington DC, might ameliorate the situation, may put the currency crisis in abeyance for a couple of weeks.

    And Brad Setser suggests another possible way out of this mess:

    And while we are on the topic of “stabilizing speculation,” China could also shift some of its portfolios from dollars to euros and pounds and Brazilian real and Australian dollars and Russian rubles. This is the time to diversify – not when the dollar is under pressure! Dollar strength amid US weakness strikes me as a growing problem.

    *Rescue is the wrong word. Countries typically invests abroad to achieve their own policy goals — whether financial returns or strengthening their own ambitions to be a global financial center — not to “rescue” another country’s banks and help another country stabilize its markets. True rescues – investments with a high probability of a loss done to assure domestic financial stability – are generally done the government of the country that regulates the troubled financial institution. No country wants to “rescue” another countries’ banking system if that means losing money.

    **The argument that China needs liquidity and only Treasuries are liquid doesn’t really work – China’s Treasury holdings are already so large that they are effectively illiquid, especially in the current market environment.

    In this fraught environment, for China visibly (and the key is visibly) to start buying other currencies would have a disproportionate effect on psychology (and be rewarding to China, since it would profit from the rally it helped engineer). That might stem the panicked capital flight, and while it is probably insufficient to restore real stability, it could keep a necessary (and painful) revauluation/readjustment process from morphing into a rout.

  23. Most incompetent campaign of my lifetime. (are you "Sure" you want this guy to be President?)

    They've got ONE big gun, and they send her to a state that McStupid has been, busily, blowing off for innumerable years.

    Meanwhile, they're "in trouble" in next-door Missouri, a state they absolutely, positive HAVE to Win. Ditto Ohio, Colorado, Virginia, and N. Carolina, Nevada, and Indiana.


    Word is, Palin's about to tell the McCrazy Express to go f**k themselves.

  24. "I will encourage every young person I know not to join the military."

    Every young man of my acquaintance here, plans on serving in the military. Every one. You couldn't pay them NOT to do it.

  25. Trish, I will be amazed if the Chinese use their reserves in any significant manner to stabilize other currencies. First, why would they go from what is now the strongest currency to weaker currencies? Second, what makes us think that the Chinese may very well have used those foreign reserves to prop up their own banking system? Third, what will the Chinese use if they have a run on their own real estate. The last time that I was in China, it sure looked like an over built and over leveraged real estate market. there was an enormous amount of investment in a very short period of time.

  26. "Fear of Indian attacks dominated Edwards's childhood. In February 1704, shortly after Jonathan's birth, Indians killed two of his cousins and took the rest of the family captive; his uncle John Williams, his aunt, four of his cousins, and two Aficans. Daily prayers for their return marked Edwards's childhood. John Williams was redeemed after three years of captivity. In his best seller of the day, "The Redeemed Captive Returning to Zion" Williams noted that being with the Indians was difficult, but the worst of it--the trial to which Williams devotes the most pages--was that the Indians were allies of French Roman Catholics:"

    'My captor took hold of my hand to force me to cross myself, but I struggled with him and wonld not suffer him to guide my hand; upon which he pulled off a crucifix from his own neck and bade me kiss it, but I refused once again. He told me he would dash out my brains with his hatchet if I refused.'

    "The Indians offered to release William's children if he would embrace Catholicism. He refused. Upon his final release, Williams returned to Boston and regained all his children but one. William's daughter Eunice, seven years old when she was taken, remained with her captors, married a Mohawk, and converted to Catholicism. Thirty six years after her capture, she visited her brother Stephen and listened to Edwards preach, but it appears she was not moved by it."

    Jonathan Edwards, When Did You Quit Beating Your Wife?--

    (after having a spiritual experience brought on by her troubles)she:

    'thought of myself being cast off by my nearest and dearest friends and as I had thought before of Mr. Edwards kicking me out of the house and finally casting me off, now I put it to myself how I could bear from him the worst treatment of me at home and thought that if he should turn to be most cruel to me and should horsewhip me every day I would so rest in God that it would not touch my heart or diminish my happiness.'

    And yet Edwards was something of a mystic, he said:

    'Looking up on the sky and clouds, there came to my mind so sweet a sense of the glorious majesty and grace of God, that I know not how to express...The appearance of everything was altered; there seemed to be, as it were, a calm, sweet cast, or appearance of divine glory, in almost everything...I often used to sit and view the behold the sweet glory of the mean time singing forth, with a low voice my contemplations of the Creator and Redeemer.'

    This from the same man who preached in "Sinners in the Hands of an Angry God'

    'The God that holds you over the pit of hell, much as one holds a spider...he looks upon you as worthy on nothing else, but to be cast into the fire...And there is no other reason to be given why you have not dropped into hell since you arose in the morning, but that God's hand has held you up.'

    "After his congregation dismissed him in 1750, after twenty four years of service, he spent most of the rest of his life as a pastor and missionary to the Indians in Stockbridge, Massachusetts, and died in 1758 of a smallpox vacination just months after becoming President of Princeton."

    from Saving Paradise

    A man can be many things.

  27. You are probably right, youth is fairly immune from adult advice.

  28. China’s Treasury holdings are already so large that they are effectively illiquid, especially in the current market environment.


    Right now, the U.S. Treasury Market is the most "Liquid" market in the World. You can sell "all you want" in a heartbeat in a phone booth, at midnight, in the middle of the Sahara (even if you DON'T have a quarter for the phone.)

    The money's done "run home to Mama" (the U.S.)

    Now, "Mama's" gotta figure out who gets fed, and how much. I don't know if she can do it. There ain't enough to go around. She needs another couple a trillion. She needs to borry it from the manufacturing countries, and oil-producing countries, and loan it to the customer (laboring) countries.

    I don't know if anyone's brave enough to take this proposition to the "taxpayers." I doubt it. Maybe we can disguise it through some sort of "International" Agreement where, basically, we "underwrite" loans to Europe.

    It might be our Only chance.

  29. The last time that I was in China, it sure looked like an over built and over leveraged real estate market. there was an enormous amount of investment in a very short period of time.

    Sun Oct 26, 12:43:00 PM EDT

    Sounds like my little corner of South America, unfortunately.

    Why would China surprisingly move to weaker currencies? Beats me. I've gotten so used to discounting or outright dismissing prevailing wisdom, dear host, that I feel I could head the Contrarian Party, were there one.

  30. Here is the full bsetser (at cfr) post referenced by Yves:

    One easy thing China could do to help stabilize global markets: buy Agencies!

    Posted on Saturday, October 25th, 2008 by bsetser

    There is constant talk – too much, in my view – about whether sovereign funds will come to the rescue of western financial institutions.

    Qatar did put a large sum of money into Credit Suisse recently, but in general the Gulf funds are reeling from large losses on their existing portfolio even as they are facing increased domestic demands (see Mufson and Pan of the Washington Post and Steven Johnson of Reuters) . “Rescuing*” US banks but not your own countries’ markets – and our own countries financial institutions — is hard. And some Gulf countries’ ability to carry out their ambitious local development plans will hinge on the availability of financing from their sovereign funds is oil stays at its current levels.

    China is still cash rich. But the CIC has yet to prove that it can manage a $100 billion balance sheet (its “frozen” investment in the Reserve Primary Fund is the latest case in point) let alone manage a US or European financial institution with a far larger balance sheet. Moreover, it would seem a bit bizarre – at least to me – for the US taxpayer to guarantee the liabilities (and thus be on the hook for most future losses) of an institution that is effectively owned by China’s government. As Uwe Reinhardt notes, US taxpayers are already on the hook for most of the downside – and handing over both the upside and control to another country’s government (typically a non-democratic government) hardly achieves the goal of keeping major financial institutions in private hands.

    But there is something that China could do that would be both stabilizing and pose few difficult policy issues: it could resume its purchases of US agency bonds.

    The US hasn’t technically guaranteed the Agencies liabilities because it doesn’t want their (large) book to be consolidated on the US government’s balance sheet. But it has signaled that it stands behind the Agencies – and so long as the Agencies are the only source of mortgage credit for American households, that guarantee is quite credible. This guarantee led PIMCO to add to its already large bed on Agency bonds – but it hasn’t reassured the central banks that until recently were large purchases of Agency bonds.

    Agency spreads remain wide. Accrued Interest has reported that they will remain wide until “real” money — and apparently more real money than even PIMCO can mobilize — returns to the Agency market, given the difficulties leveraged investors now face.

    In the past, Asian central banks — and especially the PBoC — were a key source of demand for Agency paper. But the Fed’s custodial data – which seems to capture about 90% of all central bank holdings of Agency paper – leaves little doubt that the world’s central banks are now fleeing the Agency market. In the first three weeks of October, the latest New York Fed custodial data indicates central banks have added $53.9b to their Treasury holdings while reducing their Agency holdings by $51.4b. Since September 3 – roughly the time when the Treasury announced it would recapitalize the Agencies as needed – central banks have added $130.2b to their Treasury holdings while reducing their Agency holdings by $40.7 billion.

    China accounts – by my estimate – for about 50% of all central bank holdings of Agencies, so it likely has contributed to the broad reorientation of central bank portfolios toward Treasuries. And China – unlike most emerging economies – still has a growing stockpile of reserves. It consequently is in a strong position to add to its Agency portfolio rather than continuing to pile into Treasuries.**

    That would facilitate the flow of credit to American households willing to buy homes at current prices – and thus help to support home prices, and indirectly, the US financial system. It doesn’t offer the prospect for turbo-charged returns, but Agencies do offer higher yields than Treasuries. And the downside risk is very small – unlike the downside risk associated investing in a major Western bank.

    And while we are on the topic of “stabilizing speculation,” China could also shift some of its portfolios from dollars to euros and pounds and Brazilian real and Australian dollars and Russian rubles. This is the time to diversify – not when the dollar is under pressure! Dollar strength amid US weakness strikes me as a growing problem.

    *Rescue is the wrong word. Countries typically invests abroad to achieve their own policy goals — whether financial returns or strengthening their own ambitions to be a global financial center — not to “rescue” another country’s banks and help another country stabilize its markets. True rescues – investments with a high probability of a loss done to assure domestic financial stability – are generally done the government of the country that regulates the troubled financial institution. No country wants to “rescue” another countries’ banking system if that means losing money.
    **The argument that China needs liquidity and only Treasuries are liquid doesn’t really work – China’s Treasury holdings are already so large that they are effectively illiquid, especially in the current market environment.

    This entry was posted on Saturday, October 25th, 2008 at 2:13 pm and is filed under China, central bank reserves. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

  31. This is not a "Sovereigns" Crisis. This is a "Banking" Crisis. Chinese goods are sitting on docks waiting for an acceptable "letter of credit." Chinese factories are closing. People "could" get restless.

    I expect to see China "investing" in banks all around the world. At least, I "hope" to see it.

  32. I can hear the Chinese reacting to this financial crisis.

    "WTF you mean, I send my money to banklup contlies? All you clazy?

  33. You people are missing the point. And the point is very simple:

    Without cheap energy there is no industrial growth. Without industrial growth, things like capital investment and ponzi securities lose their legitimacy.

  34. Swan Dive

    by Jim Kunstler, October 9, 2006

    Where finance is concerned, the basic implication of peak oil is pretty stark: an end to industrial expansion (i.e. "growth"). All the alternatives to oil will not keep the industrial economies expanding -- they can only slow down a contraction, and only marginally so. The trouble with this picture is that finance is a system that uses paper markers to represent the hope and expectation for the expansion of wealth. These markers are currencies, stocks, bonds, option contracts, derivatives plays, and other certificates that are traded in open markets. If there is no longer any hope of increased wealth in the world, then all those tradable paper markers become losers. Their value unwinds and imagined piles of wealth evaporate into thin air.

    The unwinding process depends on the psychology of the people who own these certificates. If they do not understand the global oil situation and its implications, then they will continue to hope for and expect expanded wealth, and thus continue to regard their paper certificates as credible markers of value. And that is largely the case at the moment, since most of the playas in the financial markets are not paying attention to the peak oil story, or don't believe it is for real.

  35. Almost All Recessions are preceded by a "spike" in energy prices. This one was huge. The interesting thing is how rapidly, and extensively the oil prices fell. Another "singular" moment. Man, this deal's got a lot of'em.

    I wouldn't get too alarmed by anything someone named "Ambrose" says. He's probably just smarting from the 25% drubbing the Pound has taken in relation to the Dollar. They were all having a lot of fun over there writing about "London, the New Banking Center of the World."

    Now, they've gotta go back to writing about "how are we ever going to get the Dirty Yanks to loan us some more money."

    Not nearly as much fun.

  36. You are probably right, youth is fairly immune from adult advice.

    Sun Oct 26, 12:46:00 PM EDT

    For those young people hellbent on it, the advice we have is this: Make sure you get yourself a good contract with the help of an expert in your intended field. Unless you really want to be completely at the mercy of events and institutions for whom you are just another warm body. That can suck.

  37. I wouldn't get too alarmed by anything someone named "Ambrose" says.

    - rufus

    Man, and I thought I had some relatively whimsical analytical "feelers."

  38. since most of the playas in the financial markets are not paying attention to the peak oil story, or don't believe it is for real.

    They've known it was For Real since, at least, 2001 (when Bush started pushing Ethanol.) They just never bothered mentioning it to the hoi-polloi.

    I could, almost, do a "Book" on why the discovery of oil was the worst thing to ever happen to the human race. It would concentrate on "localization, and biofuels, Wars, etc."

    The good news is that, soon, we'll start weaning ourselves off of this cursed, evil liquid.

  39. We had a feller named, Ambrose, come thru Mississippi, once. Didn't stay long. Cudn't find no "tea, and krumpets," or somesuch.

    Din't actually talk to him; just heard about it.

  40. Rufus, did you see this:

    Poll: Iowans favor state backing of wind power
    Associated Press
    11:49 AM CDT, October 24, 2008

    DES MOINES, Iowa - A poll shows Iowans back state support of wind power, favoring that form of energy over solar and ethanol.

    According to a copyright story in Friday's Des Moines Register, 58 percent of Iowans favored wind power when asked what form of energy state government should encourage. The Iowa Poll found that solar came in a distant second with 19 percent and ethanol was third at 16 percent.

    Iowa has 34 ethanol plants, compared to five plants that make blades or turbines for wind generators. Iowa has one major solar manufacturer.

    The poll was conducted Sept. 8-10.

  41. Ambrose Bierce? He wuz some kinda "Yankee" feller wasn't he?

    Kind of a "smart-ass?" Got the President shot, or somethin?

    Yanks, and Brits. Kinda the same. Never had much time fer'em.

  42. To paraphrase an old joke: If someone, someday wants to bet you that his newest poll will jump up and "spit cider in yer ear," don't bet him. You'll end up broke, with a wet ear.

  43. Better Place Plans Electric Car Network in Australia

    By Angela Macdonald-Smith

    Oct. 23 (Bloomberg) -- Better Place LLC, a developer of electric car networks, said it plans to raise A$1 billion ($670 million) to develop a grid for powering vehicles in Australia, backed by AGL Energy Ltd. and Macquarie Capital Group.

    The first mass-market cars are expected to be available in Australia by the 2012 model year, a year after a similar start- up in Israel and Denmark, Palo Alto, California-based Better Place said today in an e-mailed statement. Macquarie will assist in business development and financing, while AGL will provide renewable energy to power the cars, it said.

    Australia has the world's seventh-highest per capita rate of car ownership, with almost 15 million on the road, after adding more than a million new vehicles in 2007, according to Better Place, founded last year by Shai Agassi, the former top software architect at SAP AG. Morgan Stanley, Israel Corp. and Wolfensohn & Co. are among investors in Better Place.

    ``We are investing in Australia's economy and adding jobs while helping the country take a generational leap forward toward oil independence,'' Agassi said in the statement. ``With our commitment to build infrastructure and the federal government's A$500 million Green Car Innovation Fund, there is a compelling case for automobile manufacturers to jump in and build clean, safe, affordable electric cars for Australasia and Southeast Asia.''

    Wind Farms

    Macquarie is acting as a financial adviser for the project and won't take any equity stake, Sydney-based spokeswoman Fiona Tyndall said by telephone.

    The initiative will accelerate a shift in Australia toward renewable energy, Jeff Dimery, AGL group general manager, said in the statement.

    ``We will be sourcing 100 percent renewable generation to supply to Better Place for fuelling of the vehicles,'' Dimery said in an interview. Power will be supplied from projects including the Bogong hydropower plant under construction in Victoria state and the Hallett wind farms in South Australia, he said.

    The amount of power required will depend on the volume of electric vehicle sales, Dimery said.

  44. I love all of the wind energy, solar type stuff going on. It's been little remarked upon that coal hasn't sold off like oil has. It's still "right up there."

  45. At least, I Think it is. I just realized I haven't looked, lately. Interesting times, indeed.

  46. TTC's hybrid buses running out of juice, considering buying diesel coaches instead
    Web Staff,

    The TTC is putting plans to buy $61 million worth of new buses on hold because its hybrid diesel-electric buses from the same manufacturer keep breaking down, reports say.

    Officials tell a Toronto newspaper that the batteries in the buses are lasting for only 18 months, contrary to the manufacturers' claim they would last for five years. As well, fuel economy savings have only been 10 per cent, compared to a 20 to 30 per cent cut promised by Daimler Buses North America.

  47. Here's an interesting (I think) tidbit. E85 is selling for $1.49 in Council Bluffs, Iowa. Add the $0.51 tax credit, and you're up to $2.00 gallon. Now, this is what I think is interesting. At these prices Everyone Makes Money.

    Corn is selling for $3.80/bu which means the farmer makes money. At about $1.55 "out the door" the refinery makes money. The state gets their $0.35 fuel tax, and the quick shop, which probably "breaks even" on the e85, sells more bread, milk, and cigs.

    And, unlike oil, I'd bet these numbers will all work three years from now.

  48. Paying $0.16/gallon for domestic "oil" is a good deal for the gov.

  49. Interesting about the buses. Diesel is a real problem. It's twice as expensive as gasoline in parts of the U.S., now.

    The problem is you get about 22 gallons of gasoline, 12 gallons of diesel, and other assorted stuff out of a barrel of oil. It used to be pretty much in balance; but, now, we're replacing about 700,000 barrels of gasoline with ethanol, daily, and the Euros thought it would be a good idea to switch their cars over to diesel.

    Now, in order to produce enough diesel you have to "overproduce" gasoline. Bad time to be a "diesel-user."

    Volvo, recently, announce that they sold a whopping 107 (I think it was) trucks in Europe in the last quarter. That's down from 44,000 the same quarter last year. Ouch.

    Here's the "crazy" part. You can get just as much "Efficiency" from ethanol as you can Diesel if you crank up the compression.

  50. It's twice as expensive as gasoline in parts of the U.S., now.

    Brain Fart Alert!!

    Should have read: Twice as expensive as E85.

  51. Diesel is a real problem.

    Israel converted their bus fleet to natural gas. Later electric BRT (Bus Rapid Trains) will be used. My home town of Haifa will have it's first BRT line within a year.

  52. Electrified mass transit is, absolutely, a great answer in places where people will ride it. IMO, it's about the Only thing Europe has going for it.

  53. I could, almost, do a "Book" on why the discovery of oil was the worst thing to ever happen to the human race.

    That book's already been written cause I read it, but can't recall the name or author. All about overpopulation, smog, war etc.

    But I didn't believe a word of it because I've seen the old pictures of horse farming around here. And read about Europe before the automobile. Read about the peasants, my people, and the king in his castle.

    Nah, give me a pickup truck and a tractor.

    We should convert our interstate trucks and buses to natural gas. That would help.

  54. Fancy pants suits mystery solved--

    October 26, 2008

    Sarah and Hillary: out of the closet

    Ethel C. Fenig

    Susanna Chung Forest, the designer of Hillary Clinton's pantsuits, has inadvertently solved the mystery of why Democrats are mocking Republicans for spending $150,000 on clothing and accessories for Governor Sarah Palin. In a revealing statement to CBS News, Forest,

    ...who designed Hillary Clinton's pantsuits says it would be unusual for a candidate as famous as Sarah Palin to need to buy clothes.

    "Why do you need to pay for it?" Forest told CBS News from her boutique Susanna Beverly Hills saying that most designers would offer to clothe a candidate for free. "It's an honor, you are going to design for someone who could be the president of the United States," noting that the exposure any designer would get from dressing someone as famous as Clinton or Palin would be worth much more.

    Pay to play, i.e. a contribution is expected to the Democrats for access and favors, is apparently so ingrained within the party regulars that they -- and their suppliers -- just can't understand the attitude of Republicans, and Governor Palin, who actually pay full value for goods and services. They know nothing in life is free and see no reason to exploit a designer, even one ensconced in non-working-class Beverly Hills.

    The Los Angeles Times reported earlier this year that Senator Clinton's custom made pantsuits from Forest were worth about $6,350 a piece retail. Clinton's spokespeople did not respond to requests for comment.

  55. The race for president: It's far from over

    Sunday, October 26, 2008

    Democrat presidential nominee Barack Obama has been measuring for his White House curtains for months. Now, big plans have been made public for his $2 million election night victory party in Chicago. Sen. Obama is even talking quite candidly about his transition plans.

    And why not? After all, the latest New York Times/CBS News poll has Obama leading Republican nominee John McCain by 13 percentage points among both registered and likely voters.

    Of course, Obama's largest cheering section -- Big Media -- long has been in the tank for the junior senator of Illinois. Even the liberal Pew Research Center finds that Obama's ratio of favorable stories to overall stories was more than 2 1/2 times as large as Sen. McCain's.

    But you might be surprised to learn that not every poll considers Obama's coronation a fait accompli. An Associated Press poll has the race in a statistical dead heat. And the IBD/TIPP poll, considered to have been the most accurate in the 2004 presidential race, has Obama with a mere 1.1 percentage point lead, 44.8 percent to 43.7 percent with 11.6 percent undecided.

    Thus, the race for president is far closer than the media masses have led you to believe. And how delicious it would be if the media's "election" of Barack Obama suppresses his numbers and leads to an Electoral College landslide for John McCain.

    Talk about being hoisted by your own petard.

    Philadelphia Pennsylvania Newspaper editorial

  56. The point is, Bob, we could have gone straight to ethanol. Hell, we been producing the stuff ever since people discovered trees had fruit.

    The first engines were built to run on biofuels. There would have been no need to continue plowin by horse.

    But, with every area producing their own energy there would have been no use in fighting wars over the stuff, either.

  57. The first engines were built to run on biofuels. There would have been no need to continue plowin by horse.

    Yeah I know you're right on that. This book I read was bascially talking about industrialization. The machine in the garden of paradise, that sort of stuff. A point of view I've entertained at times, in the nostalgia of my imagination. When it comes right down to it, I don't want to sit behind a horse, or dig camus roots.

  58. Washington Times

    Military voters, who favored President Bush in 2004, have overwhelmingly been making donations to the Obama campaign over Mr. McCain, a decorated Vietnam veteran. The Democratic ticket has made frequent visits to the pockets of Virginia and North Carolina that boast big populations of military families.

    Dozens of troops and their children waited to catch a glimpse of Mr. Obama at a recent rally in Fayetteville, home of Fort Bragg.

    Godfred Mensah, 31, is in the Army and has been to Iraq three times and Afghanistan twice. Hours before the nominee took the stage, he and his 8-year-old son waited in line and promised that if Mr. Obama is elected, the military community would "rally behind our president."

    "The past eight years have been very demanding," he said. "Obama is going to support the change we've all be praying for. Everyone has been struggling and we're looking for something better for our family."

    Jose Cordero, 28, is serving in the Army and stationed at Fort Bragg. He will be returning to Iraq for a second tour sometime next year.

    Holding their 1-year-old daughter, Genevieve, on his shoulders in the long line for the rally, Mr. Cordero shrugged.

    "Whatever president there is, I'm working for them. But I'd rather see something new," he said.

    Diane Cordero was more direct, saying she doesn't want her husband to go back.

    "If Obama is trying to take us out of Iraq, that's good. McCain is just trying to finish off what President Bush couldn't do," she said.

    Conne Pirner's 24-year-old son has fulfilled his commitment to the Army, but she fears he'll have to serve again.

    "I have a child with diabetes and I have a son who did two tours in Iraq. And I just feel like President Bush, with his policies, has tried to kill both of my kids," said Mrs. Pirner, a teacher in Barrackville, W.Va. "If we get a Democrat in the White House, he won't be called back."

  59. McCain, R-Ariz., handily defeated Sen. Barack Obama, D-Ill., 68 percent to 23 percent in a voluntary survey of 4,293 active-duty, National Guard and reserve subscribers and former subscribers to Army Times, Navy Times, Marine Corps Times and Air Force Times.

    The results of the Military Times 2008 Election Poll are not representative of the opinions of the military as a whole. The group surveyed is older, more senior in rank and less ethnically diverse than the overall armed services.

  60. With regards to Colorado:

    Below the level of presidential races, Democrats have made steady progress in recent elections. Ritter, a former Denver district attorney, captured the governorship from Republicans two years ago, and Democrats control both houses of the state legislature.

    Democrats already hold one Senate seat and are overwhelmingly favored to pick up the open seat being vacated by Republican Sen. Wayne Allard.
    In a sign of how the race between Democratic Rep. Mark Udall and former Republican congressman Bob Schaffer is trending, the National Republican Senatorial Committee decided late last week to pull out of the race.

  61. From westhawk

    More than seven years after the start of the Afghan campaign, it is disappointing to read that U.S. policymakers have still not answered fundamental questions about U.S. campaign objectives in the region. In November 2001, the U.S. government was so reluctant to follow the Soviet path that top policymakers refused a request to insert a single Ranger battalion into the mountain passes on the Pakistan border to prevent bin Laden’s escape. That decision bungled a counter-terror operation. But it also clearly indicated that the Administration at that time had no intention of building a modern Afghan nation-state.

    By contrast, up through last week, there seemed little hesitation about reaching the 100,000 foreign soldier level the Soviets achieved in the 1980s. Building a centralized Afghan nation-state was assumed to be the only sustainable outcome. Now, the ghost of General Abizaid seems to be calling out from the wings, “Antibody!”

    The next U.S. president will make the final decision on this question. It may be a fateful one. For the first time in memory, it may become U.S. policy to settle for something less than a nation-state as an accepted outcome to a civil conflict. If that means showing some appreciation for the constraints around a problem, that will be progress.

  62. The only cooling I saw in that program, mat, was the buried air intakes. 100+ ft of buried ducting to cool the air in the earth.

    I've read about that, but have never seen an installation, nor even read of one.

    Beyond that, those are just super insulated solar homes. Pretty conventional stuff. Cutting off the air seepage has caused problems for folk in high radon areas.

    But there was nothing new, technology wise, with regards cooling that I saw.

  63. David Frum writes

    Unchecked, this angry new wing of the Democratic Party will seek to stifle opposition by changing the rules of the political game. Some will want to silence conservative talk radio by tightening regulation of the airwaves via the misleadingly named "fairness doctrine"; others may seek to police the activities of right-leaning think tanks by a stricter interpretation of what is tax-deductible and what is not.

    The best bulwark for a nonpolitical finance system and a national culture of open debate will be the strongest possible Republican caucus in the Senate. And it is precisely that strength that is being cannibalized now by the flailing end of the McCain-Palin campaign.

    What should Republicans be doing differently? Two things:

    1. Every available dollar that can be shifted to a senatorial campaign must be shifted to a senatorial campaign. Right now, we are investing heavily in Pennsylvania in hopes of corralling those fabled "Hillary Democrats" for McCain. But McCain's hopes in Pennsylvania are delusive: The state went for Kerry in 2004, Gore in 2000 and Clinton in 1992 and 1996, and McCain lags Obama by a dozen points in recent polls. But even if we were somehow to take the state, that victory would not compensate for the likely loss of Colorado, New Mexico, Nevada and other states tipped to the Democrats by demographic changes and the mortgage crisis. The "win Pennsylvania and win the nation" strategy may have looked plausible in August and September, when McCain trailed Obama by just a few digits. Now it looks far-fetched.

    But it is not far-fetched to hope that we can hold 45 or 46 of our current 49 Senate seats. In 1993, then-Senate Minority Leader Robert J. Dole (R-Kan.) stopped Hillary-care with only 43 seats. But if we are reduced to just 40 or 41 senators, as could easily happen, Republicans and conservatives would find themselves powerless to stop anything -- and more conservative Democrats would lose bargaining power with the Obama White House.

    2. We need a message change that frankly acknowledges that the Democrats are probably going to win the White House -- and that warns of the dangers of one-party, left-wing government. There's a lot of poll evidence that voters prefer divided government. By some estimates, perhaps as many as 8 percent of voters consciously cast strategic votes in favor of division. These are the voters we need to be talking to now.

    I'm not suggesting that the RNC throw up its hands. But down-ballot Republicans need to give up on the happy talk about how McCain has Obama just where he wants him, take off their game faces and say something like this:

    "We're almost certainly looking at a Democratic White House. I can work with a Democratic president to help this state. But we need balance in Washington.

    "The government now owns a big stake in the nation's banking system. Trillions of dollars are now under direct government control. It's not wise to put that money under one-party control. It's just too tempting. You need a second set of eyes on that cash. You need oversight and accountability. Otherwise, you're going to wake up two years from now and find out that a Democratic president, a Democratic Senate and a Democratic House have been funneling a ton of that money to their friends and allies. It'll be a big scandal -- but it will be too late. The money will be gone. Divided government is the best precaution you can have."

    It's the only argument we have left. And, as the old Washington saying goes, it has the additional merit of being true.

  64. There's a company here that is building homes warmed and cooled by the earth, at least partially. Dig down a bunch, put in some piping, helps keep it warm in the winter, cool in the summer.

    One can also live in a cave, at the right level you'll find an ideal temperature year in year out. There are some good caves up around the Hell's Canyon area. But you need to check for previous ownership. Guy went in one, big cave, heading to the back a bit, COUGAR. No attack, just a big growl.

  65. Coleman posts first lead since September

    Whether he's ahead or behind, GOP Senator Norm Coleman has the support of a little over one-third of Minnesota voters, polls have consistently shown. A recent St. Cloud State University survey suggests that may be enough to win him a second term.

    The poll surveyed 509 adults 10/14-22 for a margin of error of +/- 4.6%. Coleman, Democrat Al Franken and Independence Party candidate Dean Barkley were tested.

    General Election Matchup

  66. Beyond that, those are just super insulated solar homes.

    Yes. Super insulated solar homes that don't need much energy to cool/heat. Which means that the solar panels provide enough juice for that.

  67. Bobal: There's a company here that is building homes warmed and cooled by the earth, at least partially. Dig down a bunch, put in some piping, helps keep it warm in the winter, cool in the summer.

    That's geothermal, they're going to install it all over my base next year. It's going to be big business.

  68. Whit: "WTF you mean, I send my money to banklup contlies? All you clazy?

    No, it's clitical that you keep doing so.

  69. When was your birthday, Bob?

  70. Ukraine may borrow between $10 billion and $15 billion from the International Monetary Fund to "strengthen its position," Ukraine's deputy central bank governor Oleksandr Savchenko said Thursday, according to a report by The Financial Times. "We may not need all of the sum.

    We're now meeting with IMF representatives, examining the situation, and are deciding how much money we need," Savchenko said in a phone press conference, according to the report.

    15 Bil

  71. Will be Wednesday, if I make it.

  72. Losertarian Candidate In Georgia May Have Just Enough Votes To Flip The US Senate Race To The Democrats

    The U.S. Senate race in Georgia has grown a whole lot closer over the past two weeks. The latest Rasmussen Reports telephone survey in the state finds GOP incumbent Saxby Chambliss leading Democratic challenger Jim Martin by just 47% to 45%.

    This is the closest the race has been all year and the highest level of support for Martin, whose campaign has spent roughly half-a-million dollars on attack ads against Chambliss over the past month. Just two weeks ago, Chambliss held a six-point lead.

    Libertarian Party candidate Allen Buckley earns one percent (1%) of the vote in the latest poll.


  73. Unlike Iraq, where large portions of the population are urbanized in the wide, flat plains of the Tigris and Euphrates river valleys, much of Afghanistan is mountainous and dotted with remote villages that are hard to reach with large bodies of conventional forces, several Pentagon officials involved in the Afghanistan strategy review said.

    - westhawk

    And herein lies the false choice of Special Operators v. nation-building. The former are necessary to counter-terror operations. OIF's surge, for instance, would not have succeeded without them. But there is no way - no way in hell - to "turn" those same remote villages without nation-building components - the old "what's in it for me?". Michael Yon pointed out that Afghanistan is "the big game preserve" for SOF. See how well that's turned out? What you require are elements of both counterterror and counterinsurgency. And you'll eventually be doing it without the Mayor of Kabul. He's not long for the job.

  74. Happy birthday. Mine was yesterday.

  75. If Obama wins we won't be arguing about it long, we'll be out of both places, I'd imagine.

    Hawaii Governor Seals Obama's Birth Certificate story says.

  76. Happy Birthday to you too. Mine comes on the day of the stock market crash in '29. Black Tuesday I think it was. (I wasn't alive then) May be a repeat this year, if it can get any worse.

  77. It Wasn't Just a Joe-the-Plumber-Inspired Whim
    [Kathryn Jean Lopez]
    In a radio interview in 2001, Barack Obama unequivocally embraced "redistribution" of wealth several times, and also laments that the Warren Court was not liberal enough.

    Tell me this isn't socialism. Obama is the most radical nominee for president in modern history.
    Enter at our own risk.

    Obama Media
    [Mark R. Levin]
    Everyone is noticing.. The media are out of the closet.

    In a Fox News Sunday panel segment on the media's pro-Obama and anti-McCain bias, Juan Williams revealed journalists were in such a swoon for Barack Obama that during the primaries “what you saw was that the executive editors and the top people at the networks were all rushing to Obama events, bringing their children, celebrating it, saying they were, there's this part of history.”

  78. Socialism does not encourage self reliance, responsibility or personal wealth. In fact, shirking responsibility is accepted.

    Socialism does not reward anyone for working hard because everyone receives the same reward. The best worker and the slacker are rewarded the same.

    Socialism equalizes misery and poverty while productivity and efficiency suffer.

    Capitalism is Superior

  79. Karel at KGO is on that same sex marriage gig tonight, Doug, asserting any two people can marry each other. So I write in asking, can I marry my sister, my daughter? No response yet.

    Showing his tolerance, he has threatened that the Mormons ought to be cleansed from the country.

  80. (And a bene for McCain.)

    Bene - Wookieepedia, the Star Wars WikiBene was a female Human Jedi Padawan and Commander during the Clone Wars.

    You trying to give John a heart attack? Finish him off so Sarah can be President?

  81. "Syria condemns this aggression and holds the American forces responsible for this aggression and all its repercussions. Syria also calls on the Iraqi government to shoulder its responsibilities and launch and immediate investigation into this serious violation and prevent the use of Iraqi territory for aggression against Syria," the government statement said.

    Whaddya gonna do? Hm? Close the border?

  82. This is too good not to take from the Belmont Club--

    Goosey goosey gander

    Harvard economics professor Greg Mankiw talks dollars and cents by comparing the McCain and Obama tax plans to the status quo. He presents a straightforward calculation anybody can follow. But through the magic of television and the news and despite the armies of pundits, most readers will be seeing the numbers for the first time. That’s sad.

    If there were no taxes, so t1=t2=t3=t4=0, then $1 earned today would yield my kids $28. That is simply the miracle of compounding.

    Under the McCain plan, t1=.35, t2=.25, t3=.15, and t4=.15. In this case, a dollar earned today yields my kids $4.81. That is, even under the low-tax McCain plan, my incentive to work is cut by 83 percent compared to the situation without taxes.

    Under the Obama plan, t1=.43, t2=.35, t3=.2, and t4=.45. In this case, a dollar earned today yields my kids $1.85. That is, Obama’s proposed tax hikes reduce my incentive to work by 62 percent compared to the McCain plan and by 93 percent compared to the no-tax scenario. In a sense, putting the various pieces of the tax system together, I would be facing a marginal tax rate of 93 percent.

    The bottom line: If you are one of those people out there trying to induce me to do some work for you, there is a good chance I will turn you down. And the likelihood will go up after President Obama puts his tax plan in place. I expect to spend more time playing with my kids. They will be poorer when they grow up, but perhaps they will have a few more happy memories.

    Now some wag will probably ask, ‘why not lower taxes even further’. The answer is that we need to collect some monies for the common good. So it all depends on what we value as a common good. If you did the calculation for someone who didn’t pay taxes but expected to receive money from the government, the higher the tax rate on those people who do earn, the better for you.


  83. When Joe the Plumber met Barrack Obama, America's Straightest Talker met America's Biggest Jive-Ass.

  84. "Drink is the curse of the working class."
    Karl Marx

    "Work is the curse of the drinking class."


  85. I swear to the Lord, when I was at the University of Washington back in the day, and that Tom Hayden came by to raise our consciousness, giving his speech, some of the students began shouting:

    "Get a job, get a job!"

    He says, "This is my job!"

  86. After that came the La Raza speakers vowing to take back the Southwest. They're succeeding, too. Amigos.

    (La Raza means we're racists, we stand for our own race)

  87. Happy Birthdays, Bob and Sam.

    Drinks are on me.

  88. Blackwater enters anti-piracy market.

    Blackbeard, meet Blackwater.

    ...For anti-piracy operations, the 14-sailor crew would be supplemented with Blackwater security guards, four rigid-hull inflatable boats and helicopters, Mathews said. Security teams could follow a merchant vessel by air and land.

  89. London-based Olive Group, which protects Shell operations in Iraq, began offering services in the Gulf of Aden earlier this year. Its security consultant, Crispian Cuss, says just the presence of armed guards may be a deterrent.

    Pirates get information on crews and cargos from contacts in ports or at shipping companies and avoid vessels with armed men on board, he said.

    "No client's ship has been approached by pirates while we've been on them," he said.

    Piracy Fight

  90. I suspect a lot of us have been waiting to hear of privateers being called in. Meanwhile, NATO dithers over rules of engagement.

    Associated Press - NATO flotilla to start anti-piracy operations...soon

    A NATO flotilla sailing toward the Somali coast will begin anti-piracy operations within the next few days, but officials said Wednesday the alliance was still working out the rules of engagement for the seven ships.

    A fucking SOP item if you ask me. Take a look at the NATO table of organization, and ask yourself if somewhere in that bureaucracy there aren't a couple of lieutenants capable of writing a joint forces anti-piracy annex.

  91. We're doomed.

    I could write the damned ROE over my first cup of coffee in the morning.

    And then go back to bed.

  92. Thanks too, Linear. It's amazing how much piracy goes on. Heck, they steal whole tankers sometimes. Where's the International Court on all this? Where's The Hague?

    If we could buy Saddam's secret mega-yacht, we might go in the piracy business ourselves. Sneak right up on 'em, who would ever suspect?

    Couple raids, we'd be way ahead, even at $32 million asking price.

    And, no taxes to pay.

  93. Presidents who used martial swagger to cloak personal insecurity took America disastrously to war in Asia three times. Psychological animus of the sort that defines McCain has been a feature of this country's most significant foreign policy failures.

    Obama represents another mode of leadership altogether.

    The financial crisis that continues to roll across the globe, like an endless earthquake, is irrefutable proof that old categories of regional and national dispute - including the East-West divide - no longer apply. What the world needs now is an unprecedented strategic partnership between Moscow and Washington, bridging Europe and Asia, north and south, as the ground of political and economic renewal.

    Future with Russia

  94. A hint, from Sam's link:

    But some maritime organizations told The Associated Press that armed guards may increase the danger to ships' crews or that overzealous contractors might accidentally fire on fishermen.

    The record in Iraq of security companies like Blackwater, which is being investigated for its role in the fatal shooting of 17 Iraqi civilians in 2007, raises concerns about unregulated activity and possible legal wrangles.

    "Security companies haven't always had the lightest of touches in Iraq, and I think Somalia is a pretty delicate situation," said Roger Middleton, who wrote a recent report on piracy in Somalia for Chatham House, a think tank in London.

    A politically correct ROE for engaging pirates is clearly called for. From AP, naturally.

    No reflection on you, Sam.

  95. Roger Middleton, who wrote a recent report on piracy in Somalia for Chatham House, a think tank in London, denied accusations that he wears women's underwear.

  96. Where's the International Court on all this? Where's The Hague?

    Threatening NATO with legal reprisals if they're not PC in drafting their ROE would be my guess.

    And, an Obama SCOTUS will bow to them.

  97. More importantly, political questions continue to hang over the legality of Erbil's decision to allocate oil blocks independently of Baghdad. Oil export licences can be granted only by the central Government, which is still horsetrading with the Kurds over a framework for distributing oil revenues.

    As no such licences have been granted, it would be illegal for any company to start exporting. It is the political risks that have put off bigger oil companies such as BP and Shell, which are chasing contracts with Baghdad for access to the vast fields of southern Iraq.

    The small fry believe this leaves them free to find and develop new fields on their own. “This is virgin land,” said Awat al-Barzenji, project director of Kar Group, an engineering company involved in several oil projects.

    Prospects Outweigh Risks

  98. But some maritime organizations told The Associated Press that armed guards may increase the danger to ships' crews or that overzealous contractors might accidentally fire on fishermen.

    So much to fisk, so little time for fisking.

    Where in the hell does AP dig up these maritime organizations? Somalia?

    ...armed guards may increase the danger to ships' crews Like, um, it's not dangerous to be captured by a band of drugged up brigands on the high seas?

    ...overzealous contractors might accidentally fire on fishermen.

    Fishermen in zodiacs and speedboats, brandishing AKs and RPGs, whooping and hollering, and circling a freighter or tanker.

    AP...says it all. It's getting to the point where I don't even trust the media anymore. :-)

  99. “Chances of an American invasion in Iran are certainly significant; sure there’ll be diplomatic initiatives beforehand. But there is a showdown scenario developing.

    Iran is a substantial nation and has a 12km straight through which 40percent of the world’s oil flows.

    “Serious military action could lead not only to the Middle East being in serious disarray, it would mean serious implications for oil supplies. The oil price could reach 500 per barrel and it would cost you R6000 to fill your 4x4.”

    Political Turmoil

  100. The problem is, our traditional energy suppliers (Arab countries, oil
    companies, etc.) are well aware that we have no real plan for "energy
    independence" (another buzzword), and they have nothing to worry about
    in terms of market forces.

    How To Bring Gas Prices Down Now--Dr. Bill

    Bill's on the air now!

  101. Threatening NATO with legal reprisals if they're not PC in drafting their ROE would be my guess.

    And, an Obama SCOTUS will bow to them.

    hehe, that's what I was getting at.

    Dr. Bill is telling us we better be prepared again, a topic he hasn't been on for awhile. Try living without the car for a week. Or in your back yard for a week, without supplies.

    He's worried about an Obama victory.

  102. I hadn't been off the ridge for a week until last night. Just had to go down to the Mexican cafe for supper, and get a bag of coffee beans. I meet all my friends at the grocery, it seems.

    We've got the best Mexican restaurant from the Gulf of Mexico to the Salinas Valley right here.

  103. Comrades, Rise To Praise Him!

    Do you have any big game around there, other than deer, like elk, an occasional moose, bear?

  104. The 190th Fighter Squadron, Idaho Air National Guard, won the top team honors at the four day competition.

    Hawgsmoke 2008, a biennial A-10 bombing and aerial gunnery competition.

  105. Do you have any big game around there, other than deer, like elk, an occasional moose, bear?

    Naw. The deer are little white tails. Nothing like your mule deer. My neighbors put out grain and salt, and they come in and graze in their yard.

    The next closest neighbor is a helluva cook, and never saves leftovers. She puts all that food out in the garbage can, and then is surprised she has a pet bear. Big one so I hear. Neighbor's wife says it stands as high as a car window, but you know how those stories go. Mountain lions are fairly common. One scared hell out my neighbor one night. He heard his pidgeons fluttering in distress and went out with a flashlight. Happened to flash it above his head, and there was the cougar perched on a low oak limb, just above him. My dog barks all night some times. Doesn't bother me, being near deaf, but I have concern for the neighbors (occasionally).

    Fish and game planted wild turkeys in the 90s. They're doing well, but have raised the ire of the forest service wildlife biologists who claim some ecosystem perturbation or other.

    No moose. I stalked a herd of moose once on Isle Royale. If you move slow and are real quiet you can get right up to them, coming in down wind. Very poor eyesight, but big ears and very good noses.

  106. Hope for the change of the hope of the change...

    One for Mat, but he would disagree. Say he told me so.

  107. Wish this lady had been Obama's Pastor instead of "Rev" Wright!

    Its always good to hear a person’s ideas within context of the times. How ironic that this radio interview took place in Sept. 2001. I am finding it difficult to forget that Obama called our Constitution an “imperfect document . . . ” and stated that it shows ” Blind spot of framers,” which, Obama also said, continues today.

    His continuing mindset leads me to question his potential role as U.S. President (if elected - Nov. 2008). And it lends credence to his campaign rhetoric and plans to “change” America — by starting with the U.S. Constitution, even as unthinkable as that might sound to right-thinking Americans. Beware and take care of what Obama has said throughout his state, national, and international presence. And believe him. All ongoing documentation and his actions show that he is not the man for the highest office in this nation. And that remark has nothing to do with the color of his skin, as he would have Americans and the world view depict as such.

    Get informed on this side of the ballot box, because the other side of it would be too late.

    Comment: Rev. L. Dowell – 21 August 2008

  108. Fish and game planted wild turkeys in the 90s. They're doing well

    Merriams? They did well here too. If fact, great. They seem to do well in all sorts of climes.

    Moose just stand around, far as I can see. We get one once in a while. Going for the apple trees. One was right by the road once, parked right by him and watched.

    Guy out here heard his dog bark, went out with a flashlight. Six or eight big yellow staring back at him. Wolves, which have taken off, predictably decimating the elk.

    Around here mule deer are down by the rivers, white tails in the farm land and mountains, for the most part.

  109. Joanne said...

    Raila Odinga Pledges to Distribute the Country's Wealth

    Several minutes into the video at this site, this is what is said of Raila Odinga of the Socialist Orange Democratic Movement - Obama's cousin:

    "The flamboyant politican became popular with Kenya's poor by pledging to distribute the country's wealth more evenly."

    If that doesn't sound like deja vu and the apple, Obama, doesn't fall too far from the tree of his relatives, I don't know what does.

  110. No elk, I'm sorry to say. Beavers, though. In the back country as well as down in Fresno.

    I've seen some flying squirrels up higher in the red fir country. And lots of those damned spotted owls. One shit on me once. I was standing in an old abandoned roadbed, scheming on how to drop down from the new road to access some isolated stands for some second round logging. Heard something above me, and splat! Endangered my ass. If I'd had my shotgun that one would have been.

  111. He was just saying
    I love you
    It's they way
    They do

    Never seen a flying squirrel. Here in Lewiston we have the regular kind all over, quail on the roof of the house sometimes, doves, geese everywhere, which prompted a 'special city shoot' in the parks, one time, herons along the rivers, eagles, chukars, and chinese pheasants.

    Years ago the Japanese pheasant was introduced, but didn't make it. Don't know why.

  112. Bighorns, which I took pictures of couple weeks ago.

    Years ago, I saw a Lynx Cat

  113. I had a cousin from Coeur d'Alene. A lot older than me. Always wanted dad to come out for hunting and fishing. Navy pilot, killed on Friday the 13th of July, 1955. Crashed during a training flight.

    Night, Bob.

  114. Alone at the bar...late on a Sunday night...

    "Can anyone even remember now what Nixon did that was so terrible? He ended the war in Vietnam, brought home the POW's, ended the war in the Mideast, opened relations with China, started the first nuclear weapons reduction treaty, saved Eretz Israel's life, started the Environmental Protection Administration. Does anyone remember what he did that was bad? Oh, now I remember. He lied. He was a politician who lied. How remarkable. He lied to protect his subordinates who were covering up a ridiculous burglary that no one to this date has any clue about its purpose. He lied so he could stay in office and keep his agenda of peace going. That was his crime. He was a peacemaker and he wanted to make a world where there was a generation of peace. And he succeeded. That is his legacy. He was a peacemaker. He was a lying, conniving, covering up peacemaker. He was not a lying, conniving drug addict like JFK, a lying, conniving war starter like LBJ, a lying, conniving seducer like Clinton—a lying, conniving peacemaker."

    Ben Stein

    I've said to my wife repeatedly, I just want on my gravestone, 'He loved dogs' and 'Bueller, Bueller.'

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