Published Monday - Friday about 8 AM Central Time Except Holidays....many major typos are fixed by 8:30 daily Monday July 6, 2009 07:30 AM CDT
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Inflation Whipsaw
First thing out of the box this morning is the problem of whether we're going into stagflation, deflation, or hyperinflation. My best guess remains that hyperinflation will come along, but before we get there, my friend Robin Landry has been expecting a drop in gold down to the u7nder $700 range - briefly - before things go bonkers to the upside. And, he might be right.
You noticed last week - or maybe you didn't - that while gold was showing a bit of strength, silver was lagging. This morning (chart above) it looks like silver might come down to the $12 range this week. We're only a few cents from it as I write this.
Not only that, but it looks like the oil futures are coming down, as well. Under $65, but the fall in oil futures can be interpreted any number of ways. One school of thought offers that oil was too high and was already threatening to choke off the little bit of recovery that might have been possible. The other school of thought is that oil wasn't driving, but was just reacting to future expectations and it's now doing little more than indicating that the decline in the global(ist) economy is about to resume.
This is one of those "Which came first, the chicken or the egg?" kinds of questions that given tenured professors in economics something to write papers about, since the real issues in economics (like nested cycles theories) are absolutely peer-review verboten.
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What keeps leading me back to the 'here comes inflation' conclusion are stories with headlines like "California's nightmare will kill Obamanomics" and the piece by the UK Telegraph's banking editor that figures "US lurching towards 'debt explosion' with long-term interest rates on course to double."
Don't miss the Ambrose Evans-Pritchard piece from Saturday about how "The unemployment timebomb is quietly ticking." Oh yeah, we noticed.
Here, Hold This Bag Department
I have good news and bad for you. The good news is that "China won't press for new global currency at G8" summit ahead this week. The bad news is that probably means they still have more dollar-denominated paper to offload.
Rest of the Weak
Is this terrible pun Monday? Well....The biggie for folks like me who are waiting for the inflation to show up will be the Fed's Consumer Debt Report mislabeled repeatedly as Consumer Credit. Like no one gets it. Then we get the balance of trade report which will no doubt show a lesser outflow. That's become not only can't we afford to buy much anymore, but the ROW (rest of world) is getting skeptical of dollars. (See Hold this bag story previous if you're not tracking yet.)
Bankruptcy Incentive Study
Hats off to Mike Baker of the Associated Press for his story headlined "Bankruptcies low in states that don't seize wages: States that prohibit debt collectors from seizing wages have lower bankruptcy rates than peers..."
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This is all part and parcel of what I wrote about this weekend in the report titled "Frustrated America - Monetizing Misery". This is your 'monetizing misery" part.
I said it before, but it's worth remembering: When misery is monetized, the whole country is on the brink. Or, is that just too damn obvious?
Funny Or Documentary?
This week's from Rebecca Price of www.toon-republic.com:
Vet Checks Coming
$250 payments to eligible military veterans are hitting the mail now. Don't spend it all in one place.
Summer of Hell Department
"China says 140 killed in riots in West" reports an AP story.
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"Honduras coup leaders block ousted president's return." It's pronounced "two-goosey gal-pah" by the way, if you haven't hung out in Central America much. And the airport there is almost as much fun as the one-way marvel up at Cusco in Peru.
War Promotion?
The headline in Rupert Murdoch's Times that the "Saudis give nod to Israeli raid on Iran" when taken with the AP story that veep Joe "Biden: Israel; free to set own course on Iran" has me wondering if this doesn't reinforce the possible attack in late October, which would make a dandy distraction of market closings and bank holidays in late September into mid October.
Yep, nothing like a good war/ terrorist attack to swing the public's attention from the cratering economy...just like the magic 'swing' and rally 'round the flag as the economy was on the brink in 2001 - but which was subsequently saved by the instantly spawned "security" and "anti-terrorism" industries. Just coincidence, of course, rest assured. Isn't it time for another pill?
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Even though it has been dismissed as a work of fiction, and a clever anti-war book during the Vietnam era, if you haven't read and considered some of the issues Leonard Lewin raised in his 1967 Report From Iron Mountain
Before you read it, you should be aware that...
"In 1972, Lewin claimed that the report has been a hoax. At that time, he wrote that the Pentagon Papers, were "as outrageous, morally and intellectually" as his own invention: "The charade is over. Some of the documents read like parodies of Iron Mountain, rather than the reverse." (Times obit) Eventually, he sued to establish his copyright over the work, since U.S. government documents are inherently in the public domain. (Carvajal, 1996) Others, such as John Kenneth Galbraith, have maintained the reports legitimacy."
My take? Real (Galbraith) or Hoax (the author), the discussion of why people put on the yoke of government is just dandy. And, (ready in the bad pun department?) the yoke's on us.
Moscow Dealings
President O is off to Moscow (and a Ritz Carlton on our bill no less, but there's no HoJo or Motel Six there, perhaps) to arm twist and arms deal a bit with the Russians. Maybe he'll get a government discount - don't know how the Ritz folks would handle a GTR (government transportation request), if you've never traveled on one).
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I've been watching a bunch of videos on the Obama trip today, trying to catch a glimpse of Vladimir Putin standing behind the curtain pulling (nominal) president Medvedev's strings in puppet-like fashion...
Palin Bailin, Redux
The video is up on YouTube of her resignation this weekend. It starts off reasonable enough, but after a few minutes, it begins to ramble...leaving me scratching my head.
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Don't know if this is the first of the PTB disappearances or if she'll be back with a presidential exploratory committee?
Thing is: If she were to run for president, could anyone vote for someone who quits at mid-term? Hmmm...some things to ponder.
One school of thought supposed that there might be federal indictments or some earth-shaking scandal about to pop, but "Palin isn't facing investigation says FBI".
If she were going to run for president, wouldn't she have dropped more hints? If there's no indictment, then what's the deal? We're left to wonder, at least for now. But if she goes ultra-low profile - to the point where no one can find her and the family by mid fall, we'll just have to underline this as another one of the 'odd disappearances' that's been floating around predictive linguistic modelspace.
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Speaking of the 'season of disappearances' it may be the other way around since here's a headline that "Millions face hunger as seasons disappear..." It's what a seasoned reader would expect.
Speaking of Spices...
The story that one time Spice Girl "Victoria and David Beckham in their underwear for Armani" makes a fine counterpoint to the Zazzle T-shirt emblazoned with "Make awkward sexual advances. Not war."
Hey! The NY Post has "Swimsuit Issues" in its biz section today...
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Coping: Signs of the Times
A reader offers:
"Not my idea George, I'm just passing it along. Quote I read today.
"Stimulus is another word for foreplay----and we all know what comes after foreplay".
(rim shot) OK, let me put on my 'insensitive male" hat. "No, what's foreplay?"
Around the Ranch: Drought? What Drought?
The local hay growers and rancherly types who have been going to church to pray for rain finally got some on Sunday afternoon. In fact, we've put about 2½-inches into the rain gauge here since about 4 PM Sunday. Looks like more on the radar at least for the first half of the day. I do have to wonder how 2+-inches is a '30 percent chance of rain' that is referred to in the forecast. But, I suppose we can't ask for better from a gazillion dollars of super-computing horsepower, not to mention that we've got thousands of monitor-sensors before this stuff shows up over East Texas.
May even see some drought relief down San Antonio way, but we'll just have to wait and see. Been drier than a dust bunny down in the Hill Country and along the southwest part of the Permian. Which makes me expect the conversation 'round Arkey Blue's will be weather related this week.
Mean-nasty thunderstorms coming in this morning, so posting early - see ya'll tomorrow morning.....
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Send comments to george@ure.net
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The UrbanSurvival Mall:
Toward a Personal Constitution
Two great warnings about 'rights' in America have stuck with me over the years. The first was that "Rights are usually taken away from those least able to defend them first..." Something I expect First People on this continent would have no reservations about endorsing. The second thing to strike me is the 'extensibility' of the phrase "When guns are outlawed, only outlaws will have guns." It extends to thoughts like "When only special interests have access, only special interests have laws." I'm worried that with the recent blatant ignoring of the Will of the People expressed on bailouts and such to congress, that our beloved Constitution is in great peril. I hear the social contract tearing. Is it time to flag Old Glory upside down - as we're certainly in 'distress'. Enough so that I've started working on my own "Personal Constitution" as a portable back-up should the one that keeps the States 'united" fail in the midst of economic turmoil in the next year or two. Should that arrive, whether by terrorism, economic collapse, or an electric grid-killing solar flare, the relevance of the Constitution may disappear as the central government can only exists so long as it can exact tribute from We the People. I love the Constitution, but since it's being hacked up by fits and starts, it may be time to think the once unthinkable....write our own.
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