Archive for the 'Government' Category
June 24, 2008 6:43AM
By Cody Willard
Being in charge of running security for much of lower New York state isn’t all glamour and rock n roll, not even for The City CattleDog himself, lemme tell ya’. I had to spend hours on Sunday, for example, patrolling the perimeter of the Hudson Hidden Valley site…I tracked, caught, took names, and released three squirrels, two birds, and chased one of the feline members of the Evil Order of the Sphinx a good 20 feet up a tree.
It’s hard work, lemme tell ya’, and in the midst of it all, Dogi Master Cody has me training with hovering droids called Frisbees that I snatch out of the air instead of batting down with a light saber. Not that I know how to use a light saber, but I did chew the cover right off of the remote control for the stereo in Cody’s padawan pad…
People don’t seem to take firehydrant security as serious as they should. I tried to tell Cody that I needed more time on the street in front of our house in Soho tonight, as I needed to secure the area by the fire hydrant for the sixth time today — hey, it’s a busy street and I am in charge of running security for much of lower New York state and how would it look if my own neighborhood was infiltrated not just by the 20 dump trucks that drive by every night in the name of protecting our environment but also by one of the doggy-body-snatching Storm Twoofers who can only be detected by lotium olfaction (that’s Dogi Latin…what you thought pigs were the only other species with Latin…come on, you didn’t really think that, did you? ) You really do need to think about those irehydrantsfay.
Ah the pressures of such being a cattledog with so much responsibility and “spot”light. A blog post about me, a stock picking dog on a blog about mutt news? “Internet Long Tail”, indeed, roorah!
Ooh, and here’s a breaking Lobo Business Alert, the Bureaucracy of the Convoluted Pyramid Worshipers passed a vote today through a bipartisan compromise by both the DemoCats and RePelicans and we are going to be passing legislation called the New Hope Alliance that won’t do anything for the millions of homeless dogs put to death each year, but will enable, according to their best estimates, a few rich dogs to stay in their padded doghouses for a few more months…
I heard Dogi Master Cody saying something like that on my new channel on YouTube — http://www.youtube.com/LoboDogTV.
PS. Did you see Joanna Krupa wish me a happy first birthday and blow me a kiss? Rokay, rokay, so being in charge of running security for much of lower New York state does have its glamor and rock n roll to it too.
June 12, 2008 7:04PM
By Cody Willard
Here is what I was sweating about when I wasn’t sweating about the heat or killer tomatoes today.
1. Anti Permabear, but pro Tempbear.
2. Illuminati unite to decieve you.
3. iPhone winners: (AAPL) and (GOOG)
1. I used to poke fun, all the time at the perma bears for not being able to recognize the boom times for what they were from 2003 to 2007. Oil, real estate, the dollar, unemployment, inflation, geo politics, were always their reasons for promising pending armageddon. I have to say, though, that in 2008 oil, real estate, the dollar, unemployment, inflation, geo politics, guys, look at charts on those things (although there is no chart for geo politics), but they are all going crazy. They do seem to be bad as those perma bears were wishing they used to be. Call me a Temp-Bear and stay cautious.
2. Bumbling bureaucrats Ben and Paul say that the worst of the credit crisis and economic bad times are behind us. These guys are the same guys who of course who have been colluding with the other Illuminati members, like Lehman, who last week told us the that credit crisis and economic hard times are behind us and that they don’t need anymore capital. Think about it, this week they raised more than six billion dollars in capital.
3. The biggest long term winners of the second generation iPhone: the same winners as the last generation of the iPhone, Apple, don’t overthink it guys, and Google, because they get all that extra traffic on Google and YouTube from all those iPhone users and that stuff is staight margin for Google.
Check it out on YouTube
June 12, 2008 1:55PM
By Cody Willard
Back in 2004 when the Fed finally decided to start fighting the the real estate bubble they’d inflated by cutting rates to artificially low levels far below the rate of inflation and the real cost of capital. That was after the tech bubble they’d created by cutting rates to bail out mindless speculators in the Long Term Capital Management crisis had popped, of course.
Well, here we are in 2008, and the Fed’s about to decide to start fighting the commodity / energy bubble they’ve inflated by taking rates to artificially low levels far below the rate of inflation and the real cost of capital.
Back in 2004, I’d argued and bet my firm’s capital that you did want to “fight the Fed” because for the last decade or so, there’s been a positive correlation between the direction of the stock market and the direction the Fed’s taking rates. That was in large part because the Fed was typically raising rates essentially to combat steady growth which they figured in turn would eventually lead to inflation.
But in 2008 when we’re talking about the Fed’s need to raise rates, it’s not because economic growth is getting too hot. It’s because inflation’s out of control, the dollar’s collapse won’t stop, the relative attractiveness of lower rates in a collapsing currency vs. the attractiveness of higher rates in a stable currency…and did I mention inflation?
The biggest problem with the latest bubble that the Fed’s reckless rate gyrations have caused is that commodity bubbles cause inflation for the silent masses, who were already caught on the wrong side of the past bubbles, but now are really feeling the pain that bubbles cause. I mean, dot com and real estate ownership bubbles didn’t exactly have the same impact on the tens of millions of Americans who make $30,000 or less a year that the $4 gasoline bubble is having on them.
And another worry, this one admittedly paranoid, that’s been on my mind of late as I see the EU bankers and the Saudis and the rest of the world…are they really on our side as much as those past coordinated rate cuts and taxpayer-liquidity infusions would have us think?
We are on the same side with those guys across the pond, right? Right, Google and Microsoft and Ben? Right? Anybody? Hello?
I’m staying cautious when it comes to risking capital on the broader market these days.
PS. Today we published the latest edition of my stock market newsletter, The Cody Report. Click here to subscribe and get exclusive access to this month’s four stock picks.
June 4, 2008 12:06PM
By Cody Willard
What exactly is the job of the hundreds of thousands of people employed at the investment banks here in the US? Their job is to help the rest of us manage the nuances and issues that are inherent in any economy. Their job is to help people make sure they never get brazenly levered up when times are great and that they never have to desperately scramble to sell off any assets of any value whatsoever when times are bad.
I wish it were only ironic that these investment banks were brazenly levered up when times were great and now are desperately scrambling to sell off any assets of any value whatsoever when times are bad. Instead, after pocketing hundreds of billions in profits for their shareholders and employees, they now use their Illuminati connections at the Fed and Capitol Hill to sneak your money into their pockets to assist their desperate scrambling to stay alive now that times are bad and they neglected to save for the rainy day.
Let the investment banks and anybody else who took bad risks at the top burn. Let ‘em lose their shirt like they certainly deserve too.
I mean, the very idea that saving these banks with tax dollars, thereby putting all their private losses during the bad times onto the taxpayer even though the taxpayer didn’t get to partake in the private gains during the good times is somehow good for the taxpayer IS INSULTING. Having your money stolen and given to irresponsible idiot bankers who were on the other side of your smart trades ain’t good for you or for the market place or for the economy.
It’s pretty simple, really. Everybody keeps trying to convince me that if Bear and Lehman and anyone else actually go bankrupt that the bad times will really get bad. What kind of sense does that make? Saving the idiots on the wrong side of the trade only serves to make the bad times last longer and get worse, no? Flip it!!!
Finally, anybody else notice the striking parallels of business idiocy at the investment banks and at the car companies? Ford (F) bought SUV companies for billions when gas was cheap and SUVs were hot. Now it sells Land Rover and Jaguar for 1/3 of what it paid for it. GM’s (GM) all “proud” to announce that they’re basically getting out of the SUV business and focusing on smaller cars…yup, right now AFTER oil’s up 1200% in the last few years while GM was focusing on SUVs.
Of course, we subsidize those idiot car sellers in this country with billions of your tax dollars and subsidies and breaks and other loop hole tricks.
Airline industry? Always consolidating in the bad times using billions of your tax dollars and then going nuts overexpanding in the good times.
I’d just note that companies like Intel and Apple have done a little bit better job handling their respective cycles…Intel jacked up investment on R&D in 2002 and 2003 when the tech-economy was in depression. Didn’t use billions of your tax dollars to do it, either. (And they’re not asking for billions in new subsidies or breaks right now either.)
The upshot? If you think any of these corporations are actually more deserving of your take home pay than you are…if you really think that it’s better for the economy and for you and your children in the long run that Bear’s shareholders and lenders get $30 billion of your money for no other reason than they had gambled too much and then got dealt a bad hand…if you really think Ford and GM are efficiently using your tax dollars to create better, more reliable, safer and cleaner cars than otherwise would hit the market place over the next couple decades…if you really think that Lehman and the other investment banks endless chicanery is better for the capital markets than to let the capital markets eat the losing gamblers and liars, thereby allowing new, smarter, more efficient and effective entrepreneurs create new investment banks…
Well, if you really believe all that, then I encourage you to fight to keep the status quo. Don’t just condone these actions. Vote Republican and/or Democrat so that you can actually participate in these scams. Start a fund of funds to lever up in SUVs and CDOs to get that extra 30 bps in return steady every month…oh wait, that scam’s over already. Write your representatives telling them to create more subsidies and tax credits and rate cuts and exchange windows for any investment bank that’s suffering in these hard times. Because, really, those Bear Stearns shareholders and lenders are so much more deserving of your money than you are.
May 13, 2008 12:29PM
By Cody Willard
I still remember the first time I got published. I wrote an article for TheStreet.com about how the sudden constriction of capital in the telecom industry was likely to spell doom for most of the industry. I was wrong about a lot in that article (I’m pretty sure I’ve been wrong about a lot in EVERY article I’ve ever written though — that’s because I make a lot of predictions and offer a lot of analysis and opinion…and you’re always wrong even when you’re right depending on who’s reading you…so anyway, yeah, I’m wrong about a lot of stuff I write, okay? Oh, my, quite a digression about wrongness here, huh…), but one thing that I was very right about was that the credit shortage in telecom that hit at the end of a period of a glut of capital in the industry during which as I used to write, “anybody with the word ‘communications’ in their business plan could raised billions” was indeed a doomsday scenario for most of the industry.
As I’ve noted forever, one of my Jedi Masters taught me the simple principle that “all gluts are followed by shortages are followed by gluts”…and you can invest on that principle over and over again.
At the top of the glut of capital in the industry, Level 3 Communications was worth more than McDonald’s and Disney combined. Haven’t heard of Level 3? Exactly. How about 360 Networks, once headed up by billionaire former Microsoft CFO, Greg Maffei? Winstar? Enron was even in the telecom fiber route, not to mention “telecom services trading”, which was actually just mostly an accounting scam between those scumbags and their scumbaggin’ counterparts at WorldCom.
Oh yeah, WorldCom was once worth hundreds of billions. More than Bear Stearns, that’s for sure. (As an aside on that note, what’s the difference between Jimmy Cayne’s trashing of Bear with questionable accounting and bookkeeping and disclosures and Bernie Ebbers’ own trashing of his billion-dollar enterprise? I guess if you get the Federal Reserve and Capitol Hill convinced that the economy “might” collapse if you don’t bail out Jimmy and his cronies then you get free money and no jail time. Make a note for next time, Bernie.)
But all these companies are gone now. Well, LVLT’s still around, even if it’s still down 99% plus from its highs in 2000. So too is its suppliers, like Nortel and Lucent — down 99% or so from their highs of yesteryears.
And speaking of Nortel and Lucent and their 99% declines from the highs…you wanna know when the highs were hit? When they tried to keep their bubbled balls up in the air by extending cheap and easy financing to all those telecom companies that had excess capital but little prospects for near-term growth and business. That was 2000 and 2001 when they could tell that demand had collapsed by Nortel, Lucent, Cisco, et al started offering “vendor financing”.
Remember when Ford and GM got wild with their “vendor financing” back in 2003, 2004? At the top, right before they ran out of access to capital themselves and collapsed?
Why do I bring all this up today? Two parallels to watch:
1. How many times in the last year have I said, “Wall Street’s gone from a glut of capital to a shortage”? That cycle’s just turned, and it’ll take a few years at least to play out, just as telecom, the dot com bubbles did and the car bubble from 2002-2004 is still. Stay away from the financials. (And pray that the government lets those reckless scumbag investment bankers who kept their billions of gains during the glut lose their shirts and eat their own losses now that the shortage is here…socializing losses after privatized gains is evil.)
2. See this article in the USA Today about tech companies offering “vendor financing” to their ever-more-capital-constricted customer base? Careful with the tech cycle too, guys.
May 1, 2008 11:40AM
By Cody Willard
As I asked repeatedly on Happy Hour last night — if the politicians really want to provide some relief for the little guy at the gas pump, then why not permanently eliminate the tax at the gas pump. See how that works? 2 + 2 = 4.
But nooo, the Republicans and Democrats in power have all these tricks they play to screw over you at home and make sure they line the pockets of the big guys. Yeah, both frat houses are guilty of it.
Even these politicians from the two main fraternity parties’ who want to limit how much money the oil companies, the so-called private sector, can make off of private property. They’re not actually trying to fight big oil. They’re in big oil’s pockets!
Hilary Clinton last night says that there’s no reason for the oil companies to make all this money because they haven’t invented anything new. I guess you have to create something if you want to generate capital that you can keep off your own assets. Where does this logic stop?
You buy an apartment building at the bottom of the real estate cycle…and once rents skyrocket, the government’s gonna come in and decide that you can’t make that much money on that investment since you didn’t “invent” anything.
Here’s the tax I’d promote were I running for president of this country already and not just setting myself up to do so in 2016 or 2020 as a true non-fraternity-party free-thinking candidate –
Let’s cap the earnings power of anybody who used to be in office at say, $1 million a year. Yeah, I mean, anybody who served his fellow man as a leader and lawmaker of the free world should feel like a “bandit” to use another of Hilary’s terms, if they’re making any more than $1 million a year.
Imagine all the problems this cap on earnings power would solve! We know off the bat that the government would raise more than $100 million off the capper herself, Hilary!
Wanna serve your fellow man by holding a public office? You cap your future earnings potential. Capping those guys’ future earnings would undermine the entire obviously corrupt lobby industry at its core.
Wanna be a private citizen who invests in corporations that own property that creates income — yes, even income off oil? You can earn as much as you want and we’ll flat tax ya’.
Think about that last point, btw — creating a simple flat tax. I mean, these same politicians who want to “cap” earnings for these oil companies then turn around and hand them tens of billions of your tax dollars every year in sneaky tax-incentives, subsidies, and what not for drilling here, not drilling there, growing this much corn, pretending to work on solar power solutions and so on.
It’s much the same scam that the banker syndicate has finally figured out — The Republicans and Democrats in power figure out all kinds convoluted ways to pretend their fighting for the little guy when the only thing they’re actually doing is helping out their lobbyists and cronies.
So in the end, they convolute the whole tax process up as much as they can. Somehow I don’t think the little guy benefits from any of it.
Just cut the damn tax as the gas pump for starters, guys.
April 28, 2008 11:55AM
By Cody Willard
With all the pessimism and fear in the midst of all this artificial stimulation, this market has been a pretty good set up for the long side and being bullish. After leaving the business entirely myself and having my Mom take 30% of her savings out of the stock market back on air late last year, I got bullish in March after the markets had dropped 20% and had my mom put 1/3 of that money back into the markets. But as I hinted on my Big 3 during Happy Hour Friday, we’re getting closer to needing to be sellers rather than buyers of stocks again.
It’s not exactly been straight up, but the markets have indeed put on some meaningful gains since the Bear Stearns Bailout Bottom created enough panic to get real capitulation in the markets. And that capitulation did indeed put in what we now know is a meaningful bottom, as I’d thought it might at the time.
Yeah, since the Republicans and Democrats in power teamed up with the Fed to print $30 billion of dollars and give them for free to the richest people on the planet, including $1 billion exclusively for Bear Stearns’ shareholders (what their equity has to do with making sure our financial markets are functioning, which is the reasoning the Repubs, Dems and bankers have used to rationalize the theft…which in my mind undermines any of their credibility in claiming all these hundreds of billions that the government’s giving to Wall Street has anything at all to do with maintaining functional financial markets — but I digress a bit), the markets are now up double digits. The Nasdaq’s up 12% since then!
I’d been saying and writing that we’d want to be long until about May 15 when those checks from our grandchildren’s savings start arriving from the Republicans and Democrats in power who want to buy your vote with your kids’ money.
Well, as President Bush and his cronies all sing in unison about how these checks start arriving today to help poor people deal with the very inflation that the checks themselves actually cause, we have to start to “taking the trade”. The playbook’s been fast-forwarded and we’ve got a 12% move to call victory on.
You can’t go broke taking profits. And I’m gonna have my mom take that 10% back out of the market until the next panic. She’s not in any rush and we’ll be leaving about 70% of her funds exposed to the world’s more volatile markets via a well-diversified approach in mutual funds, real estate and treasuries and more.
As usual, the money trade was simply a matter of “flipping it’. If you bought the panic, you’ll now want to sell the relief. Flip it, indeed.
April 24, 2008 12:17PM
By Cody Willard
Even though it’s not a game and the repercussions of it aren’t fun, let’s start a new game on Happy Hour and here on The Cody Word called “The Food Shortage Blame Game”. (Is Chuck Woolery avail?)
I’ve been doing a lot of thinking about all this “Going green” by buying “Green guitars”, or “Green luxury bags” and we’ve all been hearing/seeing all the hype and outsized consensus about how channeling all this time, energy and money into these types of things is supposed to do good for the world’s citizens and the planet at large.
What if conventional wisdom is just dead wrong about all of it?! Flip it, man. What if all these resources that we’re channeling into these concepts that we think make the planet and its people healthier and cleaner are doing exactly opposite of their intent? Come on, that wouldn’t really shock you would it? I mean, how often is conventional wisdom and the mainstream actually RIGHT? Not often, which is exactly why we should think about Flipping It.
It’s just been in the last handful of years that these concepts that people have determined are “green” have become mainstream. And what’s happened to prices of food and all other commodities during these last handful of years as we buy further and further into these “green” concepts. It certainly seems that the result of all these policies and social movements around the developed world’s consumption habits hasn’t been very helpful to the poor in Africa that we’re supposedly trying to help with much of this “green” movement.
Are bamboo guitars actually GOOD for the environment? No, we’re still depleting the world’s resources with our consumer culture, including consuming guitars. Further, while the bamboo might grow back more quickly than oak, it’s not as if bamboo doesn’t have some downside to it. It’s an aggressive plant, man, for one thing! And $800 designer “green” bags? Gimme a break - you’re not doing anything good for the planet buying something like that. Get a potato sack bag if you want a “green” purse.
You realize it’s sorta the same logic that these “green” marketing scammers use that the “carbon-trading” marketing scammers use. “Buy this and even though you’re destroying the world, you’re paying someone to do a little bit less world-destruction to get you this product.” That’s not exactly what I call “green”.
I’m already convinced that recycling — yes, all this paper, aluminum, glass RECYCLING — is more damaging to our environment than any other hairbrained mafia scam the government and its cronies have come up with the last couple decades. You can’t tell me all the manpower and logistics that go into “recycling” garbage wouldn’t be better served re-using and re-training us to consume less packaging and waste. And you can’t tell me that the 20-plus garbage/recycling trucks that rumble along my brick street in Soho EVERY NIGHT aren’t putting more bad gases into the atmosphere and wasting more resources than if we just conserved better and buried the junk we waste. Who directly benefits from all this “recycling”? They who run the garbage business in this country. Ever watched the Sopranos…Tony and his boys in the garbage business used to chuckle at the outsized margins in their recycling scams. Yes, recycling is totally a scam and its bad for the environment. And, no, I’m not just trying to be coy in Flipping It.
And then there’s the organic movement.
It’s widely cited that the market share of organic foods in this world is about 2 or 3%. I just Googled “organic food market share” without the quotes and randomly clicked on several of the links/research reports from the results. One report talked about 25% market share for organic fruits and vegetables, while another talked about organic food market share ranges from 0% (especially for pork,it says) in some places in Europe to about 15% in Austria (one of my favorite cities in Europe is Salzburg, btw).
Regardless of whether it’s 3% or 5% of the food that we eat on this planet is organic or not, we all know that organic is a secularly growing industry within the slightly-cyclical food industry. And the yields from organic crops vs. non-organic crops? They’re not as high, that’s why the stuff is more expensive. So we’re constricting the supply per square unit on this planet just as we’re running into a possible food shortage.
Okay, so here’s where this line of Flipping It logic leaves us then, if I’m not mistaken. To help the environment, the poor and even Africa, we all should cut consumption of expensive new goods, wear potato sack shirts, fight carbon-trading, NEVER EVER recycle, and eat foods full of chemicals and pesticides.
Makes about as much sense to me as most any social/governmental movements, doesn’t it? I mean, they’ve convinced us already of the idea that stealing from the working man to “save” the investment banker is somehow good for the working man.
Here’s hoping there are winners in this game, because feeding the world isn’t really a game at all.
More on this with Environmental Capital Partner (and former NHL star) Michael Richter tonight on Happy Hour, btw.
April 23, 2008 11:56AM
By Cody Willard
On Happy Hour for weeks, we’ve been all over the rice hoarding and food riots. News that Sam’s Wholesale is limiting sales of rice is either a perfect top indicator in a mis-perceived “shortage” of food that’s actually just a figment of all you momentum traders and commodity bulls (most of whom are just mindless speculators chasing the latest trend on Wall Street).
Or this really is the start of something that we all should be VERY worried about, as hoarding of grains is about to hit the developed world for the first time in decades.
All of this, as I wrote earlier is the fault of the government, including the Fed. I have a new theory about Ben Bernanke’s Fed being so willing to screw over the savers, renters and grandmothers of the world supposedly to try to “pre-empt” any possible downturn in the economy. All this printing of billions of dollars for the richest people on the planet down on Wall Street through rate cuts, socialization of capital risk by giving banks guaranteed Treasuries in return for who-knows-how-worthless mortgages, intraday liquidity injections, and so on, by the Fed is because Ben’s just a pawn.
For all his faults, Greenspan was at least a free-thinking guy who didn’t cowtow to Wall Street in the same way. Sure, Greenie fell for the Y2K scam and created all kinds of bubbles and transfered lots of wealth from savers and renters and grandmothers too…but at least it seems like he did it on his terms.
Ben seems to simply take whatever Wall Street’s consensus has convinced him MUST BE DONE TO SAVE THE ECONOMY and put the pedal to the metal in implementing it. Now think about the conflicts of interest here:
The investment banks and Wall Street investors (the richest people in the world, actually, if you think about it how 90% of stocks are owned by 10% of the world or whatever the latest stat like that is) go to the Central Bank and explain to him that if he doesn’t help them by printing all this free money and giving it directly to them that they’re gonna be in big trouble. Oh, and therefore the common man is gonna be in big trouble.
Well, as the government always does when it redistributes wealth and tinkers with natural market forces, it turns out the most obvious unintended consequence of giving free money to rich people is BIG TROUBLE FOR THE COMMON MAN. Flip It, of course. This chart of the skyrocketing price of rice ain’t good for grandma or the guy struggling with two jobs to keep his kids in a running car and a heated home with food on the table:
Blame Ben and the two fraternity parties that you guys keep voting into power for all this food trouble.
April 22, 2008 11:51AM
By Cody Willard
As rationing has become the best case scenario in the food markets (rioting being the worst case scenario), we have to wonder if there really is starting to be a shortage of food in the world. And if so, why?
I think we’re seeing food shortages for these reasons:
1. The food markets are totally manipulated and controlled by the developed world’s governments and their cronies. The UN and all these hurtful food-aid programs that have continually undermined any chance for a self-sustaining, virtuous farming and food industry in places like the entire continent of Africa and all of Lebanon, Palestine, etc. Meanwhile, farmers in developed worlds are paid billions to grow certain crops, billions to not grow anything at all sometimes, billions to subsidize their lifestyles…
But again, the farmers in Africa? Oh, my bad, I didn’t mean to float an oxymoron — there’s practically no such thing as an African farmer, as we don’t let farmers in Africa develop any markets because the governments in the developed world also use your money to buy up billions of the crops that do get grown in the developed world to send as “aid” to the developing world, and the vicious cycle continues. The only reason these hurtful, unproductive and outright evil policies exist is because technology and excess capital had enabled the developed world to overproduce for itself, making food costs in consequential to the “average” developed world citizen. That game has officially ended, in large part because of the next point below…
2. The Fed’s quickly accelerated the pace at which it’s destroyed the value of the dollar in the last year or so. I explained it this way to the students in the macro econ class I taught at UNM a couple weeks ago: Let’s say there’s one bottle of water and one dollar bill in the entire economy. I give you the dollar bill and you give me the water. Now I print another dollar bill (because, say, I’ve got a “credit crisis” or some BS like that). Can I give you the dollar bill for another bottle of water? No! Because you can create new dollars out of thin air but you can’t create new bottles of water without actual productivity. So how much is a dollar worth after I’ve printed two? A dollar’s suddenly worth half a bottle of water instead of a whole bottle of water.
Let’s put this into the real world now. Let’s say you’re a grandma at home and you’ve lived cautiously your whole life and you own your home outright and you’ve got a fixed income that you’re living on. Suddenly, your dollar’s worth half a bag of rice instead of being worth a whole bag of rice because the Fed’s printing money for everybody who’s speculated on a mortgage, levered up on their credit cards, or works for a bank, especially an investment bank.
It’s largely this line of thinking that has me constantly calling the Democrats, Republicans and Fedheads in charge a bunch of thieves for all the ways their printing new dollars out of thin air. And it’s very much their recent actions that are causing the skyrocketing prices, and therefore a perceived “shortage” of food out there. There’s more of a glut of dollars than a shortage of food in some ways, see?
3. There’s an ever-growing number of citizens on this planet gaining access to excess capital and the wonders that happen when private property laws are at least somewhat recognized. There were 1.5 billion people on the Internet a couple years ago. Now there’s 1.7 billion. That’s 200 million more people feeling safe enough and nourished enough to log onto MySpace, Bidu and Google. Thomas Malthus, the classic economist argued that there’s a natural limit to the number of people our Earth can support. Technology and constant improvements to productivity has made his theories laughable for centuries. I expect that to continue though certainly there will be counter cycles along the next few centuries just as their has been in the past. More to the point, let’s hope Malthus continues looking like the historical idiot he always has because that means we will, over time, actually start feeding and communicating with the 4.3 billion citizens of the world that still don’t feel safe enough and nourished enough to log onto the Net too.
4. Ethanol. Farmers get billions of your taxdollars to grow food for an energy program that actually requires much more energy to create the energy in the program than any scientist can seemingly explain that the energy program might someday produce. It’s called cronyism and it’s a SCAM! Ethanol is a scam.
5. You’re grandma again, and you’re seeing the value of what you can spend disappear before your eyes every week, every month, every gas tank fill, every utility bill, etc. Might you not start hoarding as much as you can, since, as noted in point #2 above, rice holds its value in an era of created money?
The good news, IMHO, is that it’s likely most of this stuff will simply play itself out over the next few months and quarters as the forces of Revolutionomics carry through here once again. Revolutionomics is my theory that all power dissipates from the center to the edge over time. All these central controls and scams by the Democrats, Republicans and their cronies in power will be undermined by the black markets for food until the very framework of any attempts to control our world’s food supply will fail.
Oil’s got the evil OPEC mafia. Food’s got the evil FooPec mafia of its own too, huh?
All mafia must die!
PS. We’re gonna go off on this the food shortage topic in tonight’s Happy Hour, btw, so stay tuned. Let’s get to the bottom of this.
