Tuesday, September 29, 2009
Wednesday, September 23, 2009
On another note, we have been offered a wonderful opportunity to use some curb space to sell our work over the Octoberfest celebrations here in McKinney, so come by and see us in front of Laura Moore's Fine Art Gallery on Saturday...and bring your pocketbooks too! Prints will be priced to move!
Monday, September 21, 2009
on September 21, 2009 6:34 AM
In our history, the American nation committed obvious sins against select groups of people, and we've paid bitterly for some of that. But now it's our sins against the land itself that threaten to sink the USA as a viable enterprise.
It's odd, that in his otherwise excellent blow-by-blow account ("Eight Days," in the Sept 21 New Yorker Magazine) of the September 2008 Wall Street meltdown that left Lehman dead, and AIG croaking in a ditch, and the banking system in general functionally crippled, reporter James B. Stewart never got around to really describing the cause of it all -- namely, the on-the-ground material catastrophe of American suburbia.
It was the worthlessness of the tradable securitized debt associated with all those overpriced (and overvalued) chipboard and vinyl houses, smeared recklessly over the American landscape, that started all the trouble in the first place. And it is our inability to come to grips with that underlying catastrophe that prolongs the resolution of the still-florid banking crisis -- since the federal government is doing everything possible to prop up the failed capital equation of terminal suburbia, and to deny the obsolescence of that version of the American Dream and all the mechanisms for delivering it.
The suburban project was not a conspiracy by the likes of Robert Moses, Walt Disney, Frank Lloyd Wright, and President Eisenhower to produce a living arrangement with no future. It was the emergent, self-organizing result of special circumstances in a particular time and place: post World War Two America, with an immense supply of cheap oil, cheap land, and the industrial capacity to churn out all the necessary components for a car-dependent development pattern. Suburbia was spawned out of a couple of persistent themes in American cultural history: 1.) that cities and city life were no good; 2.) and that the romance of settling the wilderness could be reenacted, at great profit, in all that space beyond the towns and cities. It would be silly to deny the appeal of this arrangement at its inception. By the end of WW II, city life in the popular imagination was reduced to one potently awful image: Ralph Kramden's apartment in "The Honeymooners" TV show.
This mode of behavior persisted through the first, short-lived oil scarcity tremors of the 1970s. It was so completely embedded in the popular imagination that it had become the baseline American identity. The suburban project caught a second wind in the 1990s, when the last great non-OPEC oil fields of the North Sea, Alaska, and Siberia nullified the grip of the Islamic cartel for while, and sent the price of oil down to $11-a-barrel. Ironically, it was during those years that the warnings of "peak oil" first circulated beyond the geology offices, and it was clear to anyone who reflected on the connections that the project of suburbia was doomed.
It was also ironic, tragically so, that during this same period Wall Street began to seek some new way to make real money beyond stock and bond markets, which didn't seem to produce wealth at all for more than a decade when inflation was factored in. By a fortuitous coincidence, the revolution in computers enabled Wall Street bankers to concoct abstruse new species of tradable paper securities based on bundles of debt that seemed to produce miraculous earnings. It had the added advantage of being inscrutable to both investors and financial regulators. Due diligence became impossible and moral hazard spread like ringworm in a dormitory. The bulk of the securitized debt originated in home mortgages and the larger result was a gigantic racket ramped up between Wall Street and the US government to conceal all the structural weaknesses of a de-industrialized US economy behind a hyperbolic commerce in the very thing that the American public cherished most: their houses, which, understandably, everybody had come to call "homes." Wall Street might as easily have commoditized mother and apple pie - if you could sell each one for half a million dollars.
The banking fiasco still underway is at once a proxy for the larger failure of the American economy and the greatest fissure in it. Put as simply possible: we can't service our debt, we can't generate more debt, and the notional "capital" we thought we possessed is dissolving into nothingness. The federal government and Wall Street remain committed to supporting all the rackets associated with a suburban sprawl economy that has entered its own zone of remorseless failure. It is failing as a capital investment first, and is secondarily failing as a practical living arrangement. The two failures will continue in a close race toward terminal entropy.
The dirty secret all along was that by 2005 there was no economy left in the USA beyond the suburban sprawl economy with its so-called "consumer" nexus -- largely devoted to the outfitting of suburbia. More mortgage debt (and credit card and car loan debt) will go bad and the investment paper that represents it will go bad and it will eventually destroy our current system for accumulating, valuing, and deploying wealth. It will not destroy the function of capital -- no matter how many angry intellectuals inveigh against the straw man of capital-ism, as if it were merely a belief system - but it will be a long long time before anything sturdy or credible in the way of banking will be reconstructed out of the wreckage.
Sunday, September 20, 2009
Monday, September 14, 2009
By James Howard Kunstler
September 14, 2009 6:33 AM
Now that everybody in the USA, from the janitors in their man-caves to the president addressing congress, has declared the "recession" over, is exactly the moment when what's left of the so-called economy is most likely to implode. If there were still shoeshine boys on Wall Street, they'd be starting their own hedge funds now, and CNBC's Larry Kudlow would be toasting them in the Grill Room of The Four Seasons. What we've seen in the vaunted rally for the last six months is the triumph of wishing over facts, combined with the most arrant market manipulation by floundering banks backstopped by a panicked government -- all pounding sand down a rat-hole of hopeless non-performing debt, while pretending that the machinery of capital finance still grinds on.
Despite what a few elderly Mr. Naturals may say about abolishing "capitalism," we're not going to have an advanced economy without a coherent banking system, and by advanced economy I mean one in which the lights stay on. By coherent I mean a system that is able to deploy accumulated wealth for productive purposes, in the service of continuing civilization. (And, yes, I know that the followers of Daniel Quinn are not so sure that civilization is worth the trouble, but unless you support the killing-off of about six billion humans right away, things on Earth are not favorably disposed just now for a return to hunting-and-gathering.)
I would hasten to cut through the fog of despair to reassert -- for the thousandth time -- that a true American perestroika is possible, if the public could overcome the plague of cognitive dissonance sweeping the land and form a consensus for action that comports with reality's agenda. But that is looking less and less likely. Instead, what we see is a rush into delusion, seasoned with grievance and gall. Spectacles like last weekend's march on Washington don't happen for no reason, of course. From where I sit, the uproar can be attributed to comprehensively bad American leadership, a crisis in authority and legitimacy that has left a functional vacuum in every executive office throughout the land -- from the White House to the state houses, to the lairs of the CEOs, to the towers of the deans and department chairs, to the glitzy sets of the nightly news deliverers, to the makeshift quarters of the NGO chiefs. In former times, clueless and impotent leaders stuck their heads in the sand. Nowadays, with pandemic narcissism abroad in the land, the heads are more usually inserted into the aperture that leads into the large bowel....
But I indulge in diverting objurgation when I should perhaps explain this American perestroika more clearly. The Russian word roughly translates to "restructuring." They flubbed it in 1989 because their system was too ossified and too far gone -- though history and circumstance eventually did it for them. A similar outcome is possible here, too, in which things just have to completely fall apart before emergent reorganization occurs. But you can be sure that if we allow this to happen, an awful lot of things will get smashed along the way, including lives, careers, families, property, and cherished institutions.
This monster we call the economy is not just an endless series of charts and graphs -- it's how we live, and that has to change, whether we like it or not. Now, it is obviously a huge problem that a majority of Americans don't like the idea. If they were true patriots, instead of overfed cowards and sado-masochists, they'd be inspired by the prospect. But something terrible has happened to our national character since the triumphal glow of World War Two wore off. I just hope that the Palinites and the myrmidons of Glen Beck don't destroy what's left of this country in a WWF-style "revolution." In the best societies, such idiots are marginalized by a kinder and sturdier consensus about justice. In America today, the center is not holding because there is no center.
American perestroika really boils down to this: we have to rescale the activities of daily life to a level consistent with the mandates of the future, especially the ones having to do with available energy and capital. We have to dismantle things that have no future and rebuild things that will allow daily life to function. We have to say goodbye to big box shopping and rebuild Main Street. More people will be needed to work in farming and fewer in tourism, public relations, gambling, and party planning. We have to make some basic useful products in this country again. We have to systematically decommission suburbia and reactivate our small towns and small cities. We have to prepare for the contraction of our large cities. We have to let the sun set on Happy Motoring and rebuild our trains, transit systems, harbors, and inland waterways. We have to reorganize schooling at a much more modest level. We have to close down most of the overseas military bases we're operating and conclude our wars in Asia. Mostly, we have to recover a national sense of common purpose and common decency. There is obviously a lot of work to do in the list above, which could translate into paychecks and careers -- but not if we direct all our resources into propping up the failing structures of yesterday.
The most dangerous illusion, of course, is a belief that we can return to a hyped up turbo debt "consumer" economy -- and perhaps the most disappointing thing about Barack Obama, is his incessant cheerleading for a "recovery" to what is already lost and unrecoverable. The man who ran for office on "change" doesn't really have the stomach for it. But, of course, events are in the driver's seat now, not personalities, even charming ones. I'd venture to say that if Mr. Obama thinks he's seen a crisis, and gotten through it, then he ain't seen nothin' yet. We are for sure not returning to the kind of credit orgy that made the last twenty years such a nauseating spectacle -- of which, by the way, the misfeasances and wretched excesses of Wall Street were just one manifestation.
Some theorists out there say that economy follows mood, not vice-versa, and that the anger and sourness on display around the USA, in events like the weekend Washington march, is a clear sign that tectonic shifts in the structures of everyday life are sure to follow. There are too many truly good and intelligent people in this country, to leave our fate to the Palins and the Glen Becks. But the good people had better man up and start telling the truth with some conviction that the truth matters.
Saturday, September 12, 2009
YOU + I = ONE
Bringing the World Together
One Person At a Time
September 12 - October 7, 2009
Saturday, September 12th 7-10pm
Meet Joon and be a part of this project!
Local artist SungJoon Koo approaches people from all walks of life and asks them "What is your dream?" He then records their response digitally in their own handwriting accompanied with their portrait. Koo hopes to "bring the world together, one person at a time" by photographing portraits of people and sharing their hopes and dreams with everyone.
Come see the answers or at least the responses to the question in a public outdoor art exhibition presented by Laura Moore Fine Art Studios on South Tennessee Street in historic downtown McKinney. The outdoor public art and gallery exhibition will be on display from September 12 - October 7, 2009.
Laura Moore Fine Art Studios
107 S Tennessee
McKinney, Texas 75069
Friday, September 11, 2009
Wednesday, September 09, 2009
The Social Security Trust Fund reported an August net deficit of $5.865 Billion. This is the largest monthly deficit in nineteen years. Base on recent years data it was not surprising the Fund ran a deficit in August. But the magnitude of the shortfall was a surprise to me. This deficit is now the seventh in the past twelve months. That pace has never been seen before.
We deal with very big numbers these days. 100rds of billions and trillions are how we measure things. So a $6b monthly deficit for the Fund would appear to be a ho-hum. That is not correct. This is an important number.
The Actuarial analysis of the Fund is misdirected. Their focus is based on the future value. It should be focused on the here and now. In the June annual report the Trustees concluded that the Fund would be broke in 2037. This conclusion is so far into the future that it is easy for everyone involved to say, “this is a next year problem, health care comes first”. Stephen Goss the Fund’s head honcho said as much in a recent interview.
While there is a political case that we have to prioritize health care as an issue, it is wrong on a purely economic basis to ignore the exploding problems at the Fund. Every month that the status quo is allowed to continue makes the cost of the ‘fix’ that much larger. Based on the past twelve months performance I now estimate that the Net Present Value of future committed liabilities is in deficit by $7 trillion. To plug this sized hole would require a significant increase in payroll taxes. That isn’t going to happen. Raising payroll taxes by 4% would kill the economy. No White House economist would advocate that. The alternative of cutting benefits would be very unpopular. There are currently 52 million beneficiaries of the system. A lot of them vote. To shore up the fund would require across the board cuts greater than 20%. While that may not be a hardship for some it most certainly will be for others. The only way to address this inequity will be a means test.
The August deficit reconfirms that the Funds foundations are wobbly. Some observations:
-In August the US Treasury had to borrow an additional $6 billion in the public market to finance the cash shortfall of Social Security. We already have too much paper for sale to fund the budget deficit. SS added to the supply problem last month.
-The 2037 Future Value of the August deficit is -$17b based on a 4% return. What this means is that there will be a very significant revision in the 2037 drop-dead date. Based on current trends the go broke date is closer to 2025.
-This is not just a bad month. The net decline in the Funds assets for June/July/August comes to $7 billion. In 08 that period was in surplus by $5 billion, In 07 it was +$7b and in 06 it was +$13b.
-The decline in payrolls is hurting the Funds’ top line. January-July 2009 payroll tax receipts were down from 2008 by $5 billion or 1%. While the monthly declines in payrolls will fall over the next six months it is unlikely that there will be much net increase either. It will be a very long time before we see monthly gains of 250k. Without that kind of growth the Fund will quickly fall into annual deficits.
-The expense side is exploding. The September monthly benefits cost will be $56.6b up from $51.5 in 2008, a 10% increase.
-In 2007 the SSTF produced a surplus of $191b that it invested in the US economy. This year it will be closer to $100b. Based on the current trends that surplus will be gone by 2012. Six years earlier than the Trustees forecast in June of this year.
SS is the mother of all systemic risks. Even the debate on this topic brings risk. It will expose an additional $7trillion unfunded liability. Another reason for holders of dollars to worry.
There is no fix to this. Raising taxes is a dead end. Age warfare is a possible social consequence. The really bad news is that no one will touch this for another year. By then it might be too late.
Friday, September 04, 2009
Mostly we shot in and around the Bonham area, ate some Bar-B-Que, and found some new haunts to do further exploration in...we found some great locations to shoot bridals in, as well as other unique portraits, and met some new friends...
We're pretty pleased because we now have some new avenues to pursue...out and about...in East Central Texas...more to come...
Thursday, September 03, 2009
End of Summer Blues
on August 31, 2009 8:30 AM
In my larval, pre-blogging days, I always faced the back-to-school moment with abject dread. It meant returning to a program of the most severe, mind-numbing regimentation in the ghastly New York City public schools after a summer of idyllic unreality in the New Hampshire woods, where I went to a Lord of the Flies type of summer camp. And so here I am, many decades later, still uneasy as the final page of the August calendar flies away in a hot Santa Ana wind, and a great hellfire closes in on the far eastern reaches of Los Angeles, and the American money system falls into a peculiar limbo, and every fifth person is out of work, or going bankrupt, or glugging down the seawater of default, or being denied coverage by health insurance that he-or-she has already shelled out ten grand for this year, or getting shot in a trailer park.
I was in Los Angeles for a few days last week, as chance had it, marveling at the odd disposition of things there. I've been there many times over the years, but you forget how overwhelmingly weird it is. Altogether the LA metro area has the ambience of a garage the size of Rhode Island where someone happened to leave the engine running. To say that LA is all about cars is kind of like saying the Pacific Ocean is all about water. But one forgets the supernatural scale of the freeways, the tsunamis of vehicles, the cosmic despair of the traffic jams. The vistas of present-day LA make the Blade Runner vision of things look quaint in comparison.
You motor out of the LAX airport - personally, I love the name "LAX" because it so beautifully describes the collective ethos of the place - and you discover quickly that the taxi cab's windows are not that dirty, it's the air itself colored brown like miso soup. Going north on the 405 freeway, you see the looming Moloch of the downtown skyline through the brown miso soup. And you begin to understand why the products of the film industry are so fixated on the theme of machine apocalypse. Downtown LA looks like just such a gigantic machine as the FX crews would dream up, as if a day will come when those gleaming mirrored office towers will pull themselves out of the ground from their roots and begin lumbering, crunch crunch crunch, north toward the Hollywood Hills seeking to exterminate the vile humanity responsible for making the place what it is.
I happened to be camping out briefly in West Hollywood, in a scene-ster hotel where tiny bubbles of show biz mega-success wafted around amidst a background odor of failure, and an impossibly thin line was drawn between being pampered and being asked to go die in the gutter, please. The place is not without a certain decorum. I couldn't help but imagine how lovely Hollywood must have been in, say, 1923, when 92 percent of all the hopeless crapola now on the ground there had not yet been built, when there were no freeways, and fewer cars than currently found in Lincoln, Nebraska, you could go out to the Pacific Ocean on a "Big Red" streetcar, and on a clear day you could see from La Cienga out to Mount Wilson, and the movie "industry" was like a college theater department. What a fabulous giggle it must have all been - apart from poor Fatty Arbuckle - in that romantic desert at the edge of the world.
The whole "Dream Factory" myth has become such an awful cliché, but what remains interesting now is how it utterly infected every other organ, byway, and lost corner of American life, to the degree that the life of this nation became little more than a "narrative," a story-board, a montage of wishes superimposed over the harsher mandates of reality. Hollywood now is a mere cartoon of what Wall Street and Washington have turned into. We're a civilization of fluff now, riding on a river of toxic sludge.
I found Hollywood utterly exhausting. On morning walks down in the buzzard flats below Sunset Boulevard you almost never saw a human being outside the protective carapace of a car. I think I was the only person who ever walked down Melrose Avenue this calendar year. There were a lot of fresh store vacancies in the endless one-story strips, as if the retailers had just packed up and left Dodge under the cover of night. There were obvious, if lame, attempts to pedestrianize the major surface boulevards with fancy crossing pavements, but traffic flowed on them at sixty off the rush hours, and you felt like a marmot in a buffalo stampede out there. For solace, I listened to Bruce Molsky sing "I Ride an Old Paint" on the iPod. The fiddle part is lovely.
The city of Los Angeles, indeed the whole state of California, seems exhausted too. Apocalypse is probably such a rich theme out there precisely because everything about that particular way of life seems to be nearing its end - whether it's the fiscal fiasco or the water supply, or the aerospace economy, or the music industry, or the once-great university system, or the Happy Motoring fantasy of cruising for burgers in what Tom Waits called the dark, warm narcotic American night. I went to the movies there one hot afternoon - Tarantino's latest, Inglourius Basterds, a completely crazy but enjoyable revenge romp against Hitler & Co. - and before the feature, they showed a "trailer" for Roland Emmerich's forthcoming apocalyptathon. 2012, in which virtually every global landmark from the Vatican to the White House is destroyed, and mankind's last hope is John Cusack riding a spaceship to worlds unknown.... If that isn't shooting your wad as a movie-maker, I'm not sure what is. Maybe next time out, Roland will step back and make a movie about a puppy.
I had my fill of apocalypse by the time I left the place, only to find myself back in a real nation really dissolving into a puddle of goo. In the strange new ether of the Web, a consensus grows that we're in for a rocky autumn, as if the signal event will be something like a hurricane of shoes dropping - bank failures galore, repudiation of US debt instruments by America's former patrons, foreclosures to the farthest horizon, jobs and incomes terminated, and all the good intentions of the folks in charge coming to naught in the face of historic forces. We're off to that kind of a start this morning, with the Dow dropping eighty points and the news that Disney Inc has just paid four billion for the rights to the Marvel Comics posse - Spiderman and his homeys. As if America needs more childish fantasy.
Wednesday, September 02, 2009
Boston.com does it again...