Happy New Year 2012

Happy New Year to all my readers, friends, and colleagues from around the world -- best wishes for 2012!

US Economic Prospects for 2012...

Europe will blowup once everyone realizes that the degree of "restructuring" required in Portugal, Italy, Ireland, Greece, and Spain (PIIGS) is politically infeasible. Consequentially, public spending cuts and tax increases are imminent across the PIIGS, be they instituted by public policy or national defaults. Either way, economic depression is descending upon Southern Europe.

Protestors wearing "Guy Fawkes" masks in London

The US is also facing a blowup given that banks made a "seasonal" decision to hold off on new foreclosures until after the New Year. In 2012, the US will be confronted with the largest increase in new foreclosures since 2008.

Likewise, a budget blowup in California has been on tacit hold until after the holidays. Nevertheless, California revenues are trailing budget requirments by a significant margin. Moreover, Gov Jerry Brown appears determined to conduct "business as usual" in order to amplify the California budget crisis into a voter mandate for tax increases. Whatever happens, it's bad news for California where major cuts in government employment and/or tax increases will eventually force California into economic depression on a scale not seen on the West Coast since the Great Depression.

The combination of sharp increases in mortgage foreclosures and budget remedies in California means catastrophe along the US West Coast on a scale similar to what is about to unfold along the southern flank of Europe. Deflation and depression are already evident across America in home values, real wages, and the employment to population ratio.

The economic prospects for 2012 in the US and much of Europe are grim at best. Accredited investors are certainly in a "buy" window of opportunity at this point. However, much of America is in for hard times this coming year...

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Merry Christmas 2011

Merry Christmas to all my readers, colleagues, and friends around the world -- may peace and happiness find their way into each of your lives and our world -- always.

The Bugler of the Guard standing attentively outside my front door for the holidays...

Well Said...

"Every man's work, whether it be literature or music or picture or architecture or anything else, is always a portrait of himself."

~ Samuel Butler

Samuel Butler (1835-1902)

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Americans Cannot Imagine...

The New Lords of America

The still expanding Main Street depression is creating buy opportunities all across America. My guess is that high quality rent-earning real estate and dividend-paying stocks will be snapped up quickly by those with cash, including investors from overseas. America is "on sale" and cash buyers are now eagerly sought by sellers (i.e., too many goods chasing too little cash, which is the macroeconomic formula for deflation and depression).

Those with world-class skills to sell (e.g., physicians, engineers, and entertainers) or significant rent and dividend income are the new lords of America. Everyone else (e.g., those who live on fixed incomes, government salaries and entitlements, or earn wages for other than world-class skills) are in for hard times...

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Well Said...

"Truth is a pathless land."

~ Jiddu Krishnamurti

Jiddu Krishnamurti (1895-1986)

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The Shape of My Heart

He deals the cards as a meditation

And those he plays never suspect

He doesn't play for the money he wins

He don't play for respect

He deals the cards to find the answer

The sacred geometry of chance

The hidden law of probable outcome

The numbers lead a dance

I know that the spades are the swords of a soldier

I know that the clubs are weapons of war

I know that diamonds mean money for this art

But that's not the shape of my heart

He may play the jack of diamonds

He may lay the queen of spades

He may conceal a king in his hand

While the memory of it fades

I know that the spades are the swords of a soldier

I know that the clubs are weapons of war

I know that diamonds mean money for this art

But that's not the shape of my heart

That's not the shape, the shape of my heart

And if I told you that I loved you

You'd maybe think there's something wrong

I'm not a man of too many faces

The mask I wear is one

Those who speak know nothing

And find out to their cost

Like those who curse their luck in too many places

And those who fear are lost

I know that the spades are the swords of a soldier

I know that the clubs are weapons of war

I know that diamonds mean money for this art

But that's not the shape of my heart

That's not the shape of my heart

~ Sting (born Gordon Matthew Thomas Sumner) and Dominic Miller

US Enduring Economic Depression

According to Nobel Laureate Prof Paul Krugman (2011, December 11), "it’s time to start calling the current situation what it is: a depression." In July 2010, I reported that a Main Street depression was imploding America. Since then, the depression along Main Street has continued to expand and envelop the US national economy through today, when many in America are increasingly anxious or even afraid for the future. Evidence of economic depression in America includes the persistently low employment-to-population ratio, the devastating declines in home values, and the extended decline in real working class wages over the past decade -- this evidence is indisputable.

"Time Saving Truth from Falsehood and Envy" by François Le Moine (1688-1737)

I agree with Prof Krugman -- it's time for Americans to accept that our nation is mired in an economic depression that is deeply scarring our national political fabric -- it's the truth.

Source: Krugman, P (2011, December 11), Democracy and Depression, NY Times Online.

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Main Street Depression Imploding America

US Employment to Population Ratio for November 2011

US Home Values Caught in Rut

Prospects for Europe (and the US)

I just finished listening to today's press conference by European Central Bank (ECB) Pres Dr Mario Draghi. According to Pres Draghi, the ECB will not be monetizing sovereign debt in the Eurozone regardless of the consequences. Moreover, Pres Draghi made clear that channeling external funds (e.g., US Federal funds) through the International Monetary Fund (IMF) would violate the "spirit" of the EU treaty, and so the ECB would block any such efforts. Pres Draghi stated that the ECB would not stand in the way of the European Financial Stability Facility (EFSF) dispersing emergency funding, though the current capacity of the EFSF is known to be limited. Also, Pres Draghi predicted that the ECB's current contractory monetary policies will result in economic contraction in the Eurozone as a consequence.

Dr Mario Draghi (1947- )

In summary, a) the ECB will not be monetizing sovereign debt in Europe; b) the ECB will block efforts to monetize the debt by the IMF; c) the ECB will use the EFSF as its sole emergency funding facility; and d) the ECB is prepared to accept economic contraction across the Eurozone as a consequence of its efforts toward monetary contraction in the Eurozone.

My tentative conclusion is that severe austerities are coming to Europe, and especially southern Europe, regardless of whether challenged countries such as Greece, Italy, Ireland, Spain, and Portugal agree to sovereign concessions under an amended EU treaty.

My best advice for the US -- take cover...

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What is a Prodigy?

prodigy
n pl -gies
1. a person, esp a child, of unusual or marvellous talents
2. anything that is a cause of wonder and amazement
3. something monstrous or abnormal
4. an archaic word for omen
[from Latin prōdigium an unnatural happening, from pro- + -igium, probably from āio I say]



Source: The Free Dictionary

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Ron Paul and Political Honesty

What is Apostasy?

apostasy
n pl a·pos·ta·sies
Abandonment of one's religious faith, a political party, one's principles, or a cause.

Source: The Free Dictionary

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Well Said...

"It isn't that they can't see the solution. It's that they can't see the problem."

~ C K Chesterton

Gilbert Keith Chesterton (1874-1936)

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Еду в Магадан!

Еду в Магадан!

Well Said...

"You won't find a solution by saying there is no problem."

~ Bill Rotsler

William "Bill" Rotsler (1926-1997)

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Hoarding Pennies

Well Said...

"First, do no harm."

~ Hippocrates

Hippocrates of Kos (ca 460 BC – ca 370 BC)

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US Employment to Population Ratio for November 2011

According to the Bureau of Labor Statistics (BLS), the US employment to population ratio* for November 2011 stood at 58.7%, unchanged from the previous month, but up from 58.4% a year ago. The US employment to population ratio has been trending downwards since 2000.

[click to enlarge]

Many economists believe that reporting the number employed as a percentage of the civilian population provides a more accurate description of the current state of employment than conjecturing the number of "unemployed" in a population. The US employment to population ratio reached an historical peak of 64.4% on an annual basis in 2000.

*The BLS defines employment and population (civilian noninstitutional) as follows:

Employment consists of all persons who, during the reference week (the calendar week including the twelfth day of the month), (a) did any work at all (at least 1 hour) as paid employees, worked in their own business or profession or on their own farm, or worked 15 hours or more as unpaid workers in an enterprise operated by a member of the family, or (b) were not working but had jobs or businesses from which they were temporarily absent because of vacation, illness, bad weather, childcare problems, maternity or paternity leave, labor-management dispute, job training, or other family or personal reasons, whether or not they were paid for the time off or were seeking other jobs.... The civilian noninstitutional population consists of persons 16 years of age and older residing in the 50 States and the District of Columbia who are not inmates of institutions (for example, penal and mental facilities and homes for the aged) and who are not on active duty in the Armed Forces.

Source: Bureau of Labor Statistics

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What are Polemics?

polemics
n (used with a sing or pl verb)
1. The art or practice of argumentation or controversy.
2. The practice of theological controversy to refute errors of doctrine.

"Polemics" by C J Hauser (2009)

Sources:

Exactly Halfway Down

The Free Dictionary

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World's Greatest Airport

I am not surprised to learn that Changi Airport in Singapore is considered by many to be the world's best airport. Watch the video below to see why.



I have always enjoyed my "naps" in Changi Airport during my Asian travels (Singapore is a blast by the way). Follow the link below to visit Changi Airport's website.

Changi Airport

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