The Gulch Gallery Blog

2012-02-13T10:16:00.000-08:00

The John Brown Moment

By James Howard Kunstler
on February 13, 2012 9:30 AM

When Gaia gets pissed off enough at the antics of humanity, shesends in her hit-man, Reality, to settle accounts. Reality is blessedwith a cloak of invisibility. The human race is so busy concoctingstories about what it is doing, that Reality steals onto the sceneunnoticed - until bodies start to fall over, and the sort of badpolitical weather known as a shit-storm fills the skies, the streets,and the assembly halls.

One of the cockamamie storiescirculating this week is that the Euro bailout of broke member nationsis fait accompli, baked in the cake, a done deal, no problemo, becausethe December 2011 Long Term Refinancing Operation makes it so. TheEuropean Central Bank can supposedly eat bad bond paper until the cowscome home without choking to death at the same time that it can run aback-door money-printing racket without the results showing up incurrency degradation. And the Greeks will bend over and receive whatthey've got coming good and hard because, well, they are Greeks, and itis their way!

Excuse me, but something's got to give.History is a lot of things, but it is not silly putty. Its cousin,Reality, slips through it performing its deeds one way or another. TheGreeks have lately remembered some of their own history. The Germanshave beset them before, they now recall, and some of the moneycurrently labeled "debt" may have been filed incorrectly, the Greekssay. It actually belongs in the folder labeled "war reparations."(Granted, it is hard to read folders when you are bending over so farthat things look upside-down.) Germany, it happens, remembers too thelast time that this folder was flopped out on the table. Things didn'twork out so well for the Weimar finance ministry in those dark daysninety years ago.

Meanwhile, Athens and several other Greek cities ignite in an overture to what might come to be called the European Spring.

Reality steals onto the scene bearing a message from Mother Gaia:"None of your shenanigans make the numbers add up. The Europeanfinancial arrangement will blow up because it must." Therefore, expectit to blow up. Germany will not keep pounding sand down the rat-hole ofPIIGS insolvency for another year. Anyway, the proverbial can thateveryone was kicking down the road - it fell down the rat-hole, too, sothere is nothing left to kick except Greek civil servants, both currentand retired and, alas, they represent that part of the Greek economynot occupied by olive cultivation, which is to say most of it. It turnsout, when you kick Greeks down the road (probably Spaniards, Italians,Portuguese, and Irish, too) sparks fly off them and things catch fire.

The bottom line seems to be that Europe can either go broke or burndown, or do both. But it can't go back to what it was doing before:pretending to be rich and care-free.

Over on this sideof the Atlantic, America's experiment in pervasive control fraud took anew turn with the pretended "settlement" of massive, widespread,robo-signing allegations that will allow a bunch of "the usual suspect"TBTF banks off the hook from future liability and criminal prosecutionresulting from hundreds of billions of dollars worth of swindles. TheTBTF banks will have to pay, when all the "principal reduction credits"and other dodgy subtractions are made, a couple of billion altogether,which is obviously little more than a cost of doing business for suchsupernaturally fabulous returns. And then that is supposed to be theend of the whole disgusting episode.

Last to cave in onthis legally squooshy agreement between fifty states was New York's ownAttorney General Eric Schneiderman, newly enlisted in the elitenational corps of cads, bounders, and sell-outs. This was the week thatthe same Schneiderman agreed to lead President Obama's so calledMortgage Fraud Task Force, which, any child of eight can see, is asmokescreen to conceal the fact that the US Department of Justice hasfailed to initiate any action whatsoever in the vast and gruesomepageant of fraud that has transformed the rule of law into a rule oflarceny.

Do you think the late Whitney Houston was alost soul? Then look for the soul of your country - if you can find itin the wilderness of self-denial, self-double-dealing, and suicidalself-perfidy that it has blundered into with eyes wide shut. No lie isnow too big for the United States to swallow. If Europeans ignite andblow up when kicked down the road, here is what will happen to America:it will blunder down its own road until it reaches the next John Brownmoment. John Brown put his proverbially famous body in the middle ofthat road some ways back. He mounted an insurrection at Harper's Ferry,Virginia, in an attempt to fast-track the abolition of slavery. Brownwas hanged in 1859, but less than two years later the Civil Warcommenced, the greatest convulsion in our history. So far.

Slavery was yesteryear's abomination in America as pervasive controlfraud is today's. Somewhere out in America right now is the newAmerican John Brown, a righteous fanatic whose act is waiting to alterthe course of history. The next John Brown will also precipitate whatwas a long time coming. Reality is busy in the background, even whilewe blog and dither, setting things up.

http://kunstler.com/blog/2012/02/the-john-brown-moment.html

2012-02-03T10:30:00.000-08:00

...On the square during Dickens 2010...

2012-01-30T09:31:00.000-08:00

Jive Talkin

By James Howard Kunstler
on January 30, 2012 8:52 AM

Well, he had to get up there and say something. In this particularwinter of our discontent, the wispiest nostrums and baldest lies willdo. America is not interested in reality. America is a nine-hundredpound man imprisoned in a fetid trailer bedroom begging for one morecase of Little Debbie Cocoa Cremes before the front-end-loader bashesthrough the wall to haul him to intensive care. America just wants tohear another story about its own wonderfulness before that happens.America's soul is so lost that it has disappeared into the same cosmicwilderness that MF Global's client accounts were last seen entering.

Mr. Obama keeps telling nationwide audiences that "we have a supplyof natural gas that can last America nearly 100 years." That is justnot true. If he believes it then he is either 1) getting treasonouslybad advice from dishonest advisors or 2) not reading reports issued byhis own agencies or 3) just making shit up. This was the same week, bythe way, when the US Department of Energy dropped its estimate for theMarcellus shale gas play by 66 percent, while the estimate for all USshale basins went down 42 percent. The shale gas industry is anotherPonzi bubble that is about to founder on a scarcity of investmentcapital. Just watch.

The "energy independence" trope isa lie, too. At least in the sense that Mr. Obama means - that we canrun the suburban clusterfuck and all its accessories by other meansthan fossil fuels. He just says it because it makes voters feel better.By the time they find out it was just a story, he won't need theirvotes anymore. Meanwhile, we'll do nothing to prepare for a differentway of life, and so, necessarily, the result will be an obscenescramble for power and resources that will leave a lot of people dead.

The topper for me, though, was the President's cheeky announcementthat he'd ordered the Department of Justice to form a "special unit" toinvestigate mortgage fraud and other lethal irregularities in thebanking sector. The fact that his congressional audience did not bustout laughing shows what a convocation of craven and perfidious cat'spaws they are. Note to readers: the DOJ has a long-established criminaldivision fully empowered to prosecute all the familiar scams of ourtime from NINJA lending to the robo-signing of titles to MERS mortgagemischief, to the bundling and sales of booby-trapped CDOs - up to andincluding whatever Jon Corzine thought he was doing at MF Global.

Notice how lame the major newspapers and cable news networks were inresponding to Mr. Obama's impudent japery. None of them, including The New York Times,bothered to ask Attorney General Eric Holder what he's been up to alongthese lines for the past three years. It is really hard to account forthe stupendous incompetence of the news media in recent years. Ofcourse, I'm allergic to conspiracy theories and the only explanationthat adds up for me is the diminishing returns of technology. Amongother untruths we've embraced collectively is the idea thatcomputer-distributed information amounts to knowledge andunderstanding, tending toward judgment. Apparently, it's only made oursociety much dumber and more irresponsible. After all, none of thesupposed media watchdogs even asked The New York Times or The Wall Street Journal,or CNN and a hundred other outlets why they didn't interview theAttorney General of the United States and ask him why he has not beentaking care of the business now assigned to this special unit.

Not included in the State of the Union message was any reference tothe provision in the recently signed National Defense Authorization Actthat allows the US government to suspend due process of law and use themilitary to arrest and indefinitely detain US citizens on vague andopportunistic charges of "suspicion" You will remember a month ago whenMr. Obama signed the law and issued a "signing statement" that said hisadministration would not carry out these specific provisions. Didanyone notice that it is an impeachable offense for the president tostate his opposition to enforcing the law? In which case, why isn'tthere a bill of impeachment making its way through Congress right now?

I've had enough of Obama, though I voted for him in 2008. I won'tvote for him again. But I'm not altogether confident that any of uswill be voting for anyone in the fall of 2012. Too many systems wedepend on are spinning out of control. I suppose we will continuefeeding ourselves a diet of lies and evasions until circumstancesbecome so extreme that language itself loses all relevance and onlyreal action will answer. I believe that moment is approaching in theyet-to-be-acted-out political uproars of the spring and summer. In themeantime, American leadership is bankrupt. Just accept the fact thatAmerica has no legitimate leadership. The vacuum is total and we knowhow nature feels about a vacuum.

http://kunstler.com/blog/2012/01/jive-talkin.html

2012-01-28T21:44:00.000-08:00

Elizabeth McDonald chatting with folks at the opening of her show at Laura Moore Fine Art..the show, "Fresh Nostalgia", runs thru February8th...

2012-01-28T10:08:00.000-08:00

...Fun at Lee Harvey's...

2012-01-24T11:55:00.000-08:00

Pam and I in Bishop Arts District last year...

This was Charlie Mitcherson's old gallery I think...

2012-01-24T09:42:00.000-08:00

Murmuration

By James Howard Kunstler
on January 23, 2012 9:53 AM

On last week's podcast, Duncan and I yakked about an important concept introduced by Nicole Foss at The Automatic Earthblog site. This concept was "the trust horizon," which outlines howlegitimacy is lost in the political hierarchy. That is, people stoptrusting larger institutions like the federal or state government andend up vesting their interests much closer to home. Thus, lifede-centralizes and becomes more local by necessity. Your own trusthorizon extends only as far as other persons, businesses, institutions,and authorities immediately around you - the banker who will meet withyou face-to-face, the mayor of your small town, the local food-growers.At the same time, distant ones become impotent and ludicrous - orpossibly dangerous as they flounder to re-assert their vanishinginfluence.

It is obvious that we are in the early stagesof this process in the USA (and Europe), as giant institutions such asthe Federal Reserve, the Executive branch under Mr. Obama, the USCongress (the ECB), the SEC, the Department of Justice, the TreasuryDepartment, and other engines of management all fail in one way oranother to discharge their obligations.

The people ofthe USA, having been let down and swindled in so many ways by thepeople they placed their trust in, and even freely elected, appear tobe in a daze of injury. Maybe this accounts for the obsession withzombies and persons drained of blood - who yet seem to carry on normallives (at least in TV shows). This odd condition is best defined by thefamiliar cry from non-zombies: "where's the outrage?" Which brings meto today's point.

Investment guru James Dines introduced another seminal idea on Eric King's podcastlast week. Dines's work over the years has focused much more on humanmob psychology than technical market analysis - which he seems toregard as akin to augury with chicken entrails. Dines now introducesthe term "murmuration" to describe the way that rapid changes occur inthe realm of human activities. The word refers to behaviors also seenin other living species, such as the way a large flock of starlingswill all turn in the sky at the same instant without any apparentcommunication. We don't know how they do that. It seems to be some kindof collective cognitive processing beyond our understanding.

Dines goes on to suggest that the political stirrings and upheavalsof the past year represent an instance of human "murmuration" that willlead to even greater epochal changes in geopolitical and economic life.Now, I've often said 1) history doesn't repeat, but it rhymes [thankyou, Mark Twain], and 2) that these times are like the 1850s. To bemore precise today, these two concepts of "the trust horizon" and"murmuration" point to a moment in time that I believe we are nowrhyming with: the revolutions of 1848 and the events that grew out ofit.

The spring of that year was an inflection point whendiscontent over the changes sweeping through European society brokeinto open insurrection in France, Prussia, Austria, Italy, Poland,South America, and other places all seemingly at once - despite theabsence of television and the internet. However, the upheavals of 1848occurred not long after the first practical installation of a telegraphline from Annapolis, Maryland, to Washington, DC (and then in Europe).It was also a time when the first railroad networks were linking up.

In February that crucial year, the liberal "Citizen King"Louis-Philippe of France was driven off the throne after an18-year-reign characterized by tranquility and prosperity compared tothe decades that preceded it. In March, street protests and violencespread through the grab-bag of kingdoms, dukedoms, and obscureprincipalities (Prussia... Saxony... Hesse... Fulda...) that wouldeventually make up the super-state of greater Germany. The Austrianempire began its slide into senility as its constituent states rioted.Even the people in Switzerland went batshit. And so on. Enter, stageleft, Marx and Engels with a new political theory, for the excellentreason that the industrial revolution was reaching its stride and theconditions of daily life were changing very rapidly. Country peopleleft farms for factory jobs all over the continent, and the ill-effectsof the new wage-slavery drove them into solidarity. The uproar of 1848was widespread and left many changes in its wake. But it was short andit produced odd instances of right-wing reaction.

InFrance, for instance, Louis-Philippe was sent packing (to England), anda new republic was established - but the president it elected wasNapoleon Bonaparte's nephew, Louis Napoleon who, in a matter of monthsdeclared himself president-for-life, and then Emperor. He was not atall a bad ruler, as things turned out. Among other achievements, hepresided over the massive physical renovation of Paris that producedthe "city of light" beloved today. But he was driven off his thronetwenty-odd years later from the ill effects of the opera bouffe knownas the Franco-Prussian War.

In any case, the main pointis that so many people across a continent got the same idea in thefirst weeks of a particular year, and then set about expressingthemselves violently. More to my point is how things worked out inAmerica. You have no doubt realized by now that there was no uprisingin the USA in 1848 (though we did prosecute a war with Mexico). Yet, inthe best Fourth Turning sense of history, a new generation hadcome of age and was producing the revolution in ideas that includedEmerson and Thoreau's Transcendentalism, and the abolition movement,dedicated to ending slavery. This combination of broadly-heldidealistic notions boiled away for another decade and led to the"mumuration" that precipitated the biggest bloodbath of the civilizedworld in the 19th century: the American Civil War. The Revolution of1848 expressed itself most horrifically in the place that thoughtitself most specially insulated from its effects.

Hence, when you read an idiot such as Paul Krugman in Monday's New York TimesOp-Ed kindergarten, prating on the end of hard times in the USA,swallow a good half-pound of kosher salt. James Dines is right, a greathuman "murmuration" is underway, vibrating like a bass chord throughbodies politic all over the world. Wait until you see what breaks looseat the Democratic and Republican conventions later this year.

http://kunstler.com/blog/2012/01/murmuration.html

2012-01-21T13:39:00.000-08:00

Young people in the reflecting pool outside the Opera House in Downtown Dallas...

2012-01-18T08:30:00.000-08:00

Why SOPA is Dangerous...

’m sure you’ve heard by now that SOPAis bad and would ruin the Internet, but have you actually read thebill? If not, it’s worth reading, for two reasons. First, if you aregoing to oppose a bill, you should know exactly what you’re opposing,not just the vague principle behind it. Second, it’ll provide you witha valuable insight: that these bills are written in an attempt toobscure the truth.

First off, I’m going to qualify that I’m not a lawyer. However, I ama programmer, and that’s made me pretty good at unraveling spaghetticode. If ever a bill was spaghetti, this is it. If a programmer on myteam wrote code as convoluted as this bill, I would fire him on thespot. That being said, there may be provisions I’m wrong about; ifthere are, please do correct me. My intent is to communicate the truthof this bill as cleanly as possible.

Here is the full text of the bill,as of Jan. 15, 2012. Open a copy, because I’ll be referring to it. Ithelps to click the “Printer Friendly” link to access a single-page viewof the bill.

The Scalpel

Section 102(a)(2) permits the attorney general to take actionagainst foreign sites (i.e., sites that do not fall under U.S.jurisdiction) if “the owner or operator of such Internet site isfacilitating the commission of [copyright infringement].”

We’ll expand on this further down, but the really scary thing hereis that there isn’t any qualification that the site be solely for thepurpose of theft, only that it facilitate it. Since copyright violationis ridiculously easy, any site with a comment box or pictureupload form is potentially infringing. Furthermore, DMCA Safe Harborprovisions are no defense. You, as a site operator, become liable forcopyright infringement committed by your users, even if you comply withDMCA takedown requests.

This isn’t quite as bad as the rest of the bill because the powerlies with the attorney general, rather than the copyright holder. Butit’s not good, either. The language is so broad that it could bewielded against most any foreign site the AG chooses to target.

If the AG chooses to take action against a site (either against theoperator, if they are subject to U.S. jurisdiction, or against the siteitself if no one under U.S. jurisdiction can be found), then asubsequent court order would require the following:

Internet service providers will be required to block your access to the site (section 102(c)(2)(A)(i)) within five days.
Search engines (Google, Yahoo, Bing, etc.) will be forced to remove all references to the offending sites from their indexes (section 102(c)(2)(B)).
Ad providers (Google AdSense, Federated Media, etc.) will be required to stop providing ad service to the site.
Payment providers (PayPal, Visa, etc.) will be required to terminate service to the site.

Effectively, this bill gives the attorney general the power to fullycensor foreign sites that the government does not have jurisdiction totake down directly. The most immediate example is WikiLeaks— under such an order, your ISP would be forced to block your access toWikileaks. Once the technical means to do this are in place, then itbecomes very easy for this power to be extended.

Implementing censorship protocols and giving the keys to the government is a scary, scary thing, and SOPA should be opposed simply based on this provision alone. But that’s not all.

The Sledgehammer

The really unsettling part of the bill is section 103. It is titled“MARKET-BASED SYSTEM TO PROTECT U.S. CUSTOMERS AND PREVENT U.S. FUNDINGOF SITES DEDICATED TO THEFT OF U.S. PROPERTY.” On a first reading, itdoesn’t sound that frightening. Read through section A1.

DEDICATED TO THEFT OF U.S. PROPERTY- An ‘Internet site is dedicated to theft of U.S. property’ if–
it is an Internet site, or a portion thereof, that is a U.S.-directed site and is used by users within the United States; and
either
the U.S.-directed site is primarily designed or operated for thepurpose of, has only limited purpose or use other than, or is marketedby its operator or another acting in concert with that operator for usein, offering goods or services in a manner that engages in, enables, orfacilitates–
a violation of section 501 of title 17, United States Code;
a violation of section 1201 of title 17, United States Code; or
the sale, distribution, or promotion of goods, services, or materials bearing a counterfeit mark, as that term is defined in section 34(d) of the Lanham Act or section 2320 of title 18, United States Code; or
the operator of the U.S.-directed site–
is taking, or has taken, deliberate actions to avoid confirming ahigh probability of the use of the U.S.-directed site to carry out actsthat constitute a violation of section 501 or 1201 of title 17, United States Code; or
operates the U.S.-directed site with the object of promoting, orhas promoted, its use to carry out acts that constitute a violation of section 501 or 1201 of title 17, United States Code, as shown by clear expression or other affirmative steps taken to foster infringement.
QUALIFYING PLAINTIFF- The term `qualifying plaintiff’ means, withrespect to a particular Internet site or portion thereof, a holder ofan intellectual property right harmed by the activities described inparagraph (1) occurring on that Internet site or portion thereof.

Wow, now there’s a chunk of legalese that’ll make your eyes gloss over. Let’s cut straight to the nasty bits.

An `Internet site is dedicated to theft of U.S.property’ if [a portion of the site is US-directed] and is used byusers within the United States and is primarily designed or operatedfor the purpose of offering services in a manner that enables orfacilitates [copyright violation or circumvention of copyrightprotection measures].

Still doesn’t sound that bad, but consider this: Any site thatallows users to post content is “primarily designed for the purpose ofoffering services in a manner that enables copyright violation.” Thesite doesn’t have to be clearly designed for the purpose of copyrightviolation; it only has to provide functionality that can be used toenable copyright violation.

This means that YouTube, Facebook, Wikipedia, Gmail, Dropboxand millions of other sites would be “Internet sites…dedicated to theftof U.S. property,” under SOPA’s definition. Simply providing a featurethat would make it possible for someone to commit copyrightinfringement or circumvention (see: 09 F9 11 02 9D 74 E3 5B D8 41 56 C5 63 56 88 C0) is enough to get your entire site branded as an infringing site.

Furthermore, you may be painted as infringing if you, the siteowner, “take deliberate actions to avoid confirming a high probabilityof the use of…the site to carry out acts [of copyright infringement orcircumvention].” This means if you deliberately decide that it’s notcost-effective to screen every piece of content and determine whetheror not it is copyright-free before it is posted to your site (whetherthere is infringing content on your site or not), then you are labeledas an “Internet site…dedicated to theft of U.S. property.” Simply theact of not actively screening every piece of content makes you acriminal under SOPA.

So, We’re All Infringing, Now What?

Section 103(b) is really hairy, but we’ll attempt to parse throughit. I’m not going to copy the whole text here, for the sake of brevity,though I do encourage you to read and understand it. Instead, we’lldiscuss the most salient parts.

Payment providers (section (b)(1)) and ad networks ((b)(2)) arerequired, upon receiving a claim against a site by a copyright holder(section (4)(A)(i)), to cut off all services to the accused site withinfive days, unless they receive a counter-notification fromthe operator of the accused site. Note that there is no requirementthat the accused be notified of said accusation, and thus, they wouldhave no opportunity to provide a counter-notice. In practice, you’dprobably find out about it when you notice that the money stops comingin, maybe a week or two later.

The only way to provide a counter-notice is to agree to submit toU.S. jurisdiction (section (5)(A)(ii)) if you are a foreigner (yikes),and to state under penalty of perjury that your product does not fitthe definition of an “Internet site…dedicated to theft of U.S.property.” As we discussed above, it’s nearly impossible to notfit that definition. If you have a comment box, and you state that youaren’t guilty under that definition, you just committed perjury. Enjoyprison. Furthermore:

Any provider of a notification or counternotification who knowingly materially misrepresents under thissection…that such site does not meet the criteria of an Internet sitededicated to the theft of U.S. property shall be liable for damages,including costs and attorneys’ fees, incurred by the person injured bysuch misrepresentation as a result of the misrepresentation.

So, if you provide that counter-notification that you aren’t aninfringing site, but if you can possibly be painted to fit thedefinition of an infringing site (and again, you will be), you are nowliable for all of the attacking party’s attorney fees. By replying, yougive them carte blanche to sue you with no cost to themselves.

Now, if you provide a counter-notice, or an ad network or paymentprovider fails to cut off service within five days, then the accusingparty may then serve you (the site owner) with a lawsuit. If they can’tget a hold of you, they may serve an in remlawsuit against your site. If they win the lawsuit (and they will, ifnobody is there to challenge them), then the court will award themownership of your site (likely, the domain). This is the point whereyour accuser is required to notify you that they are taking actionagainst you. This is how the situation could play out.

Plantiff accuses your site of infringement and serves notice to PayPal and Google, et al. PayPal and Google must shut off your payment services and ad services in 5 days. You are never notified.
If a service provider fails to shut off service, then the plantiff may may now take you to court for infringement.
Once you become aware that you’ve been accused of infringement, youeither a) let your services get cut off by taking no action, or b)serve a counter-notice, which places you under US jurisdiction (ifyou’re not in the US) and sets you up for a perjury charge.
If you respond with a counter-notice, then Plantiff may now take you to court for infringement.
Plantiff accuses your site of infringement, and you don’t respond. Plantiff files an in rem lawsuit, and seizes control of your domain.

The Bulldozer

Section 201(b)(1) expands criminal copyright infringement to include:

…At least 10 copies or phonorecords, or of at least10 public performances by means of digital transmission, of 1 or morecopyrighted works, during any 180-day period, which have a total retailvalue of more than $2,500.

Now, the way that the value of a work can be computed in court is the very crude (value of the work times number of views).

…Total retail value may be shown by evidence of thetotal retail price that persons receiving the reproductions,distributions, or public performances constituting the offense wouldhave paid to receive such reproductions, distributions, or publicperformances lawfully.

This means, for example, if you upload a video to YouTube of yousinging a popular song, and that song might sell for $1, and your videogets 2,500 views, you are guilty of felony copyright infringement.Furthermore, you can tack on “willful infringement for commercial gain or valued at more than $1,000.”

This would make you a felon, and if a copyright holder were to bringa suit against you, would give you a criminal record that would make itvirtually impossible to gain future employment, and may subject you toup to three years in prison for singing a song. You don’thave to receive any money. You don’t have to gain anything from yourvideo. Simply receiving 2,500 views on a song you sung, which happensto have copyright held by someone else, makes you a felon.

Section 201(c) of SOPA includes a new rule of construction: a personwith “a good faith reasonable basis in law to believe that the person’sconduct is lawful shall not be considered to have acted willfully forpurposes of the amendments made by this section.” By implication, aperson who believed her conduct was protected (e.g., fair use) might befound to have acted “willfully,” if her belief about the law is held tobe unreasonable.

SOPA expands “willful infringement” to include those who don’tunderstand the law, not just those who understand it and choose toignore it.

To Sum Up

SOPA:

Gives the government the right to unilaterally censor foreign websites.
Gives copyright holders the right to issue economic takedowns andbring lawsuits against website owners and operators, if those websiteshave features that make it possible to post infringing content.
Makes it a felony offense to post a copyrighted song or video.

This bill turns us all into criminals. If it passes, then you eitherstop using the Internet, or you simply hope that you never end up inthe crosshairs, because if you’re targeted, you will be destroyed bythis bill. You don’t have to be a big, mean, nasty criminal — commonInternet usage is effectively criminalized under this law. This billwill kill American innovation and development of the Internet, as itwill become too risky to do anything of value. It is toxic anddangerous, and should not, under any circumstances, be supported.

I hope that this helps you to more clearly understand why SOPA isbad. Rhetoric is efficient, but you should know what you’re opposingand why you’re opposing it. It’s difficult to read and understand, butif you care about the Internet, free speech and personal freedom atall, you owe it to yourself to understand and oppose SOPA.

http://mashable.com/2012/01/17/sopa-dangerous-opinion/

2012-01-16T19:51:00.000-08:00

...out back...iPhone 4 and snapseed...

2012-01-16T19:40:00.001-08:00

What Gives

By James Howard Kunstler
on January 16, 2012 9:55 AM

The awesome exertions of the global banking system to evade themandates of reality finally yield in a sickening slippage to epochalunwind. What a bad idea: to try to juke nature itself. In case youweren't paying attention over the weekend - and who really wants to? -the cosmic Brinks truck of free money went over a cliff, and the darnthing will keep free-falling until (at least) the American markets openagain on Tuesday.

So, everybody and his uncle over inEurope got a sovereign debt downgrade and now the math changes for allthe pretend bail-outs and back-stops that had been so exquisitelyrigged through the long, nauseating autumn. Math is an annoyingrepresentation of reality, but hard to argue with. Bail-outs andback-stops finally became unaffordable even as poetic constructs.

Thus, we also approach the dreaded inflection point for the creditdefault swaps. Nobody believes that this Mount Everest of jive bond"insurance" can actually pay out, since the first instance of anyattempt will bankrupt everybody. And yet there are the holders of allthat paper who will object to, say, an 80 percent haircut on theirGreek (and other) bonds. Surely some of them will try to invoke theirCDS contracts. What then? Three possibilities that I see: 1) allparties and counter-parties go down the drain faster than you can sayBenedict Cumberbatch; 2) all parties declare in unison that CDS were aprank that should now just be ignored, as if the cast of Downton Abbeyshowed up naked at the dinner table; and 3) every sort of loan on God'sGreen Earth is instantly re-priced and the entire world turns into aflea market. How will America do with its stock of slightly pre-ownedDunkin' Donuts stores, a million-odd Elvis lunch-boxes, and all thoseold videos of Friends? Don't you wish you'd invested in some hand tools?

In the background of these grave machinations lurks the tragedy ofIran. Subtract the Islamic maniacs who seized the levers of governmentthere thirty-three years ago, and you'd actually find a perfectlymodern society, complete with industries, skyscrapers, highways, TV shows, and people eating nice food in restaurants. One can understandwhy the last Shah was hated and resented. But here you now have a wholeclass of despotic maniacs much worse than the Shah ever was and theycannot be gotten rid of. Worse, they are devoted to exacting vengeanceon the USA and its kindred western nations.

This may bejust a tragic case of collective psychological scripting, but it istending in the direction of a full-dress play-out. Our governmentbelieves that their government is determined to build an atomic bomb.Iran's government says, over and over, "...what an idea...!" Thetrouble is, our guys don't buy their vaudeville act. They will not beallowed to have a bomb, and that's all there is to it. We are doingeverything short of all-out war to prevent it, but let's face it, a lotof these things could be construed as acts of war: Stuxnet attacks...blowing up nuclear scientists in their cars. These things are makingalready-crazy people even crazier, and more reckless.

Ifevents continue down this path then there will be some action in thePersian Gulf. The oil markets will be thrown into disarray. Iran maysink a US naval vessel or two, but we know about their sunburn missilesand we won't put the whole fleet in harm's way, and before too long wewill fuck them up very badly. The Iranians are capable of busting up alot stuff in their neighborhood even as their air force is vaporizedand their electric grid goes down. They could launch missiles into theSaudi Arabian oil terminals, for instance. Surely they will try to rainhell down on Israel. That would be a recipe for turning Teheran into anashtray and a terrible tragedy for those otherwise normal Iranians whoare not religious maniacs who wanted nothing more than to raise theirchildren and once in a while go out for a nice lamb dinner.

I don't see any percentage in China and Russia coming into thisrumble, though more than a couple of European nations may want toforget their troubles for a moment and, at least, cheerlead from thesidelines.

The result of all this - if the actiondoesn't get totally out-of-hand - is sure to be a gigantic step down inworldwide energy consumption, trade, and advanced economic activity. Itwould make the Great Depression look like a sit-com. The Americansuburban nexus would fail in a matter of weeks. The USA would have tocommence the greatest work-around the world has ever seen. In theevent, governments everywhere are liable to fall, even here, withelections postponed. There will be little in the way of real money torepair all the things that are falling apart.

Mostamazing of all is how quiet the world scene has been, really, since2001. The buildup of tensions must be out-of-this world. Something hadto give.

http://kunstler.com/blog/2012/01/what-gives.html

2012-01-12T09:37:00.000-08:00

Photographer Ralph Gibson at Richland College back in March, 2011...

An interesting lecture to say the least!

2012-01-11T21:31:00.000-08:00

A few years ago, when they were widening the sidewalks downtown...

2012-01-10T10:01:00.000-08:00

...Checking lights in the Gulch...

Photo by Kiran I think...long time ago...

2012-01-10T08:37:00.000-08:00

This Ripe Moment

By James Howard Kunstler
on January 9, 2012 9:21 AM

The narcolepsy of the long Yuletide draws to a close and the worldreawakens to its self-spun web of mutually reinforcing fiascos. Justbefore the holiday, a sense of futility darkened the European bankinglandscape as cascading sovereign default looked more and moreinevitable. It was halted by a bazooka-caliber currency swap Ponzi thatallowed the European Central Bank to pretend it had a $700-billion bagof sugar-plums to hand out to more than 200 banks there. That gambitwill only keep up the appearance of normality for a couple of months,until the late winter bond rollover provokes a new crisis stage.

Likewise, in the USA, some pressure-cooked December employmentstatistics gave the false impression of a brightening jobs picture, butno major news network dared to glance behind the curtain at theshort-term holiday hires, the uncounted long-term jobless, the ones whodon't show up at the government offices anymore, the ones who stoppedgetting checks, the legions of the hopeless. A nation that can't call'bullshit' on its own lies deserves all the suffering that might raindown upon it, and that's exactly where we are heading as thingseconomic morph into things political.

How quaint thecurrent Republican jousting tournament will seem in a few months whenreal violence rides in on the zephyrs of springtime. Each new primaryis like the unloading of a Ringling Brothers clown car. There is aninverse relationship between the seriousness of these times and thelaughable personalities vying for a place in history. Are they runningfor high office or auditioning for the role of Parson Weems in a newLifetime Network TV mini-series? Are you charmed by their absurd casualclothing? Comforted by their know-nothing jabber about the"game-changer" of shale oil and their sincere doubts about the climatechange "story?" Is it morally satisfying to know that one or another ofthese candidates won't drink a beer? (They'd make good Ayatollahs.) Inwhat sort of Creationist parthenogenetic incubator are such pietisticidiots hatched? What these sanctimonious pricks don't realize they aredoing is destroying the very legitimacy of the idea that we're capableof governing ourselves per se.

This is the long-termdirection of life in North America, by the way - a breakup into smallautonomous governing units. It's just that the current cast ofcharacters brings an aura of low comedy to the process. By the timethey're through with Washington, the credibility of Federalism willsound like a knock-knock joke.

As for the other side,the "folks" now occupying the White House and its folkster-in-chief,Mr. Obama - the time has come to abandon them. Their failure iscomplete with the new national security act that allows for suspensionof due process of law. The cheek of Mr. Obama in offering a "signingstatement" to the effect that his administration would not enforce thelaw! - as he signed it! For one thing, Obama tacitly invited his ownimpeachment by declaring he had no intention of enforcing federal law,since enforcement is the chief duty of his office. If John Boehner werenot himself such a fraud, he would have started a motion forimpeachment before sundown that day.

Occupy Wall Streetwill seem like a mere harvest dance when we look back from the uproarslater in 2012. Both organized parties have managed to banish the ruleof law in America. Both parties need to be driven into the wildernessof history and the rule of law has to be rescued from the oblivion theysent it to. What group of clear-thinking adults can get behind thatsimple project? What voices will resolve out of the phenomenal noise ofgadget America, with its deafening tweets, incessant advertising,instant messaging, idiotic robo-calling, and ever-present flat-screenassault on the senses?

I discern the distant sound ofrebellion, a spirit that won't be appeased by bytes of Disney-babblefrom the pandering snouts of Romney, Santorum, Gingrich, Paul or Obama.They are interested only in keeping a set of suicidal rackets going.All the yammer about "freedom" and "liberty" is hollow when the rule oflaw is AWOL. This ripe time is the natural moment for a true oppositionto rise. A few months from now neither major party will have a crediblecandidate or a plausible platform of ideas. This will be painfullyobvious. What angels and demons will rush into that awful vacuum?

http://kunstler.com/blog/2012/01/this-ripe-moment.html

2012-01-07T12:24:00.001-08:00

Turner Falls State Park...

2012-01-03T13:09:00.000-08:00

2012 Forecast: Bang and Whimper

By James Howard Kunstler
on January 2, 2012 7:28 AM

There's a lot to be nervous about, even if you don't subscribe to the undercooked Mayan apocalypse lore moving through the gut of the Internet like a Staphylococcus-infected tamale. The casual observer might say that nothing seemed to give on the world scene in 2011 despite the Fukushima meltdown, the Arab Spring uproars, the train wreck of European finance, the disappearing act at MF Global, and the assorted injuries done to the Kardashian brand by the giant walking dildo Kris Humphries.

I demur. On close examination, the industrial world underwent complete zombification in 2011. Its member states and their institutions are now lurching across the stage of history like so many walking dead. Whole European nations are dead, their citizens squirming around the ruined bones of failed speculative condo projects, housing estates, and luxury hotels like botfly larvae. The USA lies in complete moral ruin despite the exertions of ten thousand evangelical preachers in dusty back-road tilt-up chapels from Texas to Carolina, several new museums of Creation Science, and the shining example of former Senator Rick Santorum. Just look at how we behave, from the cloakrooms of Congress to the piercing parlors of West Hollywood to the 7-Elevens of suburban Maryland: a nation of thieves, racketeers, reality TV sluts, wannabe road warriors, light-fingered gangsta-boyz, and crybabies living in an anomie-drenched decrepitating demolition derby landscape of failure. When everybody is a zombie, whose brains are left to eat? Echo answers.... On to the predictions for 2012 then.

The biggest political shock awaiting us is the massive disruption of the major party nominating conventions next summer, when thousands of angry citizens descend on Tampa and Charlotte demanding a reality test. The parties will attempt to go about their ritual business, ignoring the mischief outside the convention centers, and both parties will make the mistake of siccing the cops on the protestors. The result will be a much bigger mess than the one I personally witnessed on the streets of Chicago, 1968, when the party hacks anointed the grinning sell-out Hubert Humphrey to run against Ole Debbil Nixie. Just before getting tear-gassed on Michigan Avenue that night, I saw some kid hoisting a sign that depicted the nominee with a Hitler mustache over the epithet: Mein Humph! It made my night, despite the subsequent retching in the gutter.

The two major parties are completely bankrupt zombie organizations and this election may be their last stand - if they even survive the conventions. Neither of them can come to grips with the reality-based issues of the day: epochal financial and economic contraction, peak energy (and many other resources), climate change, the absence of the rule of law in banking, and generational grievance - or, perhaps more to the point, the manifestations of these giant trends as presented in unemployment, debt slavery, foreclosure, bankruptcy, homelessness, hunger, and X-million family tragedies. Both parties can only promise the return to a bygone status quo that is largely mythical.

President Obama, the putative "progressive" - spokesman of the Ivy League, Silicon Valley, Lower Manhattan, and all the other precincts where "folks" imagine themselves to be advanced thinkers - can't even wrap his mind around the simple fact that we will never be "energy independent" if we think that means running 260 million cars and trucks, no matter how many algae farms we pretend to invest in. Here is man who ought to know better and either doesn't, or is lying about it. He has other failures to answer for, too. Why, following the Citizens United decision in the Supreme Court, did Mr. Obama not prompt his party to sponsor federal legislation (or a constitutional amendment) that would redefine a corporation as not identical in "personhood" to a human being? Why does he still employ an Attorney General who has not started one prosecution for financial misconduct amid a panorama of arrant swindling and fraud? (Ditto: heads of the SEC, CFTC, etc.) And why did he not object loudly to the provision in the latest defense appropriations bill that allows for the capricious arrests and indefinite detention of anyone in the USA on suspicion of "terrorism?" Does this graduate of Harvard Law remember what habeas corpus means?

A lot of voters projected on Mr. Obama some notion of supernatural brilliance - our Hollywood fantasies are rife with wishes to be saved, and therefore redeemed, by our former victims - but he turned out to have a pedestrian mind. Could he possibly believe we have "a hundred years of natural gas" in the ground? Or that we're in a position to ramp up another cycle of industrial economic "growth?" Or that we can continue the web of cruel rackets that passes for medical care in this country? When the Democratic Party re-nominates Obama, it will be sealing its death warrant, and it will be on its way to the same cosmic vacuum where the memory of the Whigs lingers on.

Meanwhile, the Republicans labor to convert themselves into the party of corn-pone Nazism with all their unconcealed lust to push everybody around under the plastic eagle rubrics of "Freedom" and "Liberty." Look at the dismal lineup of morons, hypocrites, and religious fanatics arrayed for the Iowa caucus: a doctor who is also a creationist!? A leveraged buyout artist! A grifter fresh from K Street! A lady Christian theocrat wholly owned by the "dominionist" New Apostolic Reformation cult! A George W. Bush imitator showing symptoms of early onset senility! The whole posse is preoccupied with things supernatural. And being so dedicated to things unreal, they're the prime representatives of the suburban clusterfuck, who will do anything to keep that obsolete machine running, even if it means national suicide, because they lack the brains to understand where history is taking us and what the mandates of reality are shouting at us about the urgent need to reorganize American life. They are also the vassals of corporate despotism - where the Democrats are mere footservants. They masquerade as "job creators," but they promote the off-shoring of every activity that corporate America can shed in its quest for ever-greater executive compensation. The lip-service they pay to "freedom" is belied by their intent to control everybody's personal life, commoditize the public interest, and sell out their grandchildren's future for a few extra rounds of golf.

I think this gang, too, will be sent packing by the mobs of 2012. I have a nagging intimation that some third party candidate will emerge. The two personalities I keep seeing in that role are Howard Dean and Michael Bloomberg. Both of them are imperfect, but both of them are clear-headed and action-oriented, and I have a feeling that both of them are stewing in the background over the spectacle of idiocy, inertia, and dithering they see at every political compass point. Maybe somebody else will crawl out of the woodwork. I've said before in the weekly blog that conditions could deteriorate so badly that a Pentagon general might have to step into national leadership just to keep the grocery stores supplied with basic rations - but that is an outcome in my personal asteroid belt of probabilities.

Whatever party ends up running things, and whomever fronts it, is going to be in for a helluva wild ride. The USA is diving into an economic depression that will make the 1930s look like a Busby Berkeley production number. Compressive contraction will have its way with us, whatever Ben Bernanke thinks. There will simply be less activity of the kinds we're used to - Big Box shopping sprees, hamburger sales, theme park visits, house closings, you name it - than our hypertrophic system requires to keep its own destructive momentum going. Instead, the whole thing will just topple over, inert, like a 99-cent gyroscope giving into the forces of entropy. There will be a lot of bewildered, angry, dispossessed people from sea to shining sea. Not a few of them will "act out," that is, start breaking things, stealing things, targeting easy prey, hurting bystanders, and even tangling with police. Personally, I don't believe in the internment camp meme so popular among the doomer paranoiacs, but surely a lot of people will be cooling their heels in some slammer - while many other miscreants will just get away with crimes against persons and property.

The global banking system was on death-watch all through 2011. Somehow the various doctors in the central banks and finance ministries were able to muster enough accounting legerdemain to give the appearance of a system still showing a pulse. But in a compressive debt deflation, there are only so many accounting tricks you can pull off as money (and wealth) literally disappears down a cosmic worm-hole. In Europe, the process has moved from the margins toward the center. The people of Greece, Portugal, Ireland, Spain, Italy, Belgium will have less income, fewer government services, lost wages and pensions, less comfort than they have had for a couple of generations. Meanwhile, France is drowning in bad paper and the German banks are choking on it. There is really only one plausible outcome and that is default. The reckoning of the bondholders is at hand. Everybody will get poorer simultaneously - and if not, there will be not just regime change but civil war and revolution. The fantasy of a fiscal union in Europe is impossible because it means two things: that Germany will have to issue orders to everybody else; and that Germany would have to pick up the tab for everybody else while telling them what to do. Both are intolerable and implausible. Let's just think of the Euro experiment as an interesting side effect of the peak energy era... now drawing to a close.

These professional economists with their jabber about QEs and "financial repression" and bond-term "twists" and debt-to-GDP ratios are missing the point. The advanced industrial nations will not be re-jiggered onto any "growth" runway. Rather, we're entering the rutted wagon-road of de-industrializing and un-advancing. What awaits us in a "time-out" from hyperbolic technological progress. Forget about Ray Kurzweil's nanobot nirvana. That is not in the cards. Instead, wrap your mind around life in an economy organized around farming, with a much sparser distribution of big urban centers, and far fewer people overall. Don't imagine for a moment that your grandchildren will be zinging across the landscape in electric cars sampling one theme park after another while "networking" with "friends" on cyborg social networks implanted in their brain jellies. Think of them grooming their mules in the summer twilight. Anyway, you get the picture: everything that the finance ministries and treasuries and central banks are affecting to do is mere shadow theater performed in support of wishful thinking.

The question, then, is what kind of hardship and disorder will attend our journey out of the industrial era into post-technological age we are entering. Will we just turn the world into a Michael Bay movie and blow everything up? Or will we make some graceful descent and retain what is really best about the human spirit?

2012 will be the year of internal strife in these "advanced" nations, of people fighting over the table scraps of modernity among their own, in their own backyards, a desperate sorting out of the remnants. I don't think we'll see fighting between the European nations until the internal conflicts are resolved and that will take a few years.

The hot-spots for 2012 are very likely to be in the Middle East. You already know that. What could be more obvious than the tinderbox character of that region? Islamic extremism is poised to take over governments (and armies) in Egypt, Syria, Libya, possibly Algeria, and probably Pakistan. Iran lost its mind decades ago and seems determined to dominate the region by means of a strategy that can only get it into trouble (and perhaps the whole world if it goes really badly). Saber-rattling is one thing; making an actual move something else. Block the Straits of Hormuz? Not if you don't want Teheran to turn into an ashtray. That may happen anyway if Iran rattles a nuclear saber. Germany, France, Britain, and Italy, all struggling with terrible problems at home, would breathe a sigh of relief if the mullahs were chastened. The chatter around the Web about an Israeli preemptive attack never ceases. But it is a possibility.

Oh, and don't forget Turkey. Formerly the "sick man" of Europe, Turkey has become strangely resurgent, prompting some recollections that the Ottoman Empire actually administered over much of the Middle East until 1914, and not with complete incompetence, either. They just sort of imploded from empire fatigue, which is not the worst way to go down, if history is taking you there anyway. But empires come back, too, and what passes for Turkey today is a polity that in one incarnation or another has been around since the ancient Greek days, and was, for quite a long while, Rome Release 2.0.

Don't be surprised if some hostilities break out between Turkey and Iran, since a battleground named Iraq lies between them. Iraq is a basket-case despite an immense reserve of oil under its sands, and having had the US military babysit it for eight years. The last American combat units left Iraq this fall, but there are still plenty of US soldiers there, maintaining our garrisons and keeping an eye on things. The question is: can they control what the Kurds do in the north, and whatever meddling Iran engages in around the Basra oil region in the South? These American support troops remaining in Iraq could find themselves looking like a ham-and-cheese sandwich between a lot of crusty mischief north-and-south. The Turks have already had a dustup or two with Syria lately - Syria occupies a big wedge between Turkey, Iraq and the Mediterranean Sea - and Turkey will take a dim view of that nation falling into the hands of Islamic extremists if Assad gets booted.

All bets are off in Egypt. Anything can happen there.

The dangerous position of Israel vis-à-vis all these quarreling players is probably as bad as it has been in two generations. An attack by a neighbor or getting caught in a crossfire between neighbors would stimulate a lusty response, and perhaps World War Three. As if the world needed this added aggravation. It makes my kishkas ache just to think about it. Sometimes I wonder why the whole Israeli nation doesn't just pack up and move to Nebraska.

2012 is the year that China proves to be a mortal nation and rolls over with a very bad case of the vapors. Their banking system is a sham. Their property bubble is a fiasco. Their government has no formal legitimacy and will install a new leadership group this year, while exports crash and mass factory layoffs happen. There will be a lot of pissed off people in China, and they may express themselves politically in ways that have seemed unthinkable for decades. The aura of social control looms large in China, but an aura is a light garment not recommended for stormy political weather. 2012 could be the year that China begins its journey into a "Balkanized" collection of smaller autonomous parts, which is the big fat trendline for all the nations of the world, including the USA.

It is hard to think about the bizarre case of India, a nation with one foot in the modern age and the other in a colorful hallucinatory dreamtime. Their climate-change related problems are doing heavy damage to the food supply. Their groundwater is almost gone. The troubles of the wobbling global economy will take a lot pep out of their burgeoning tech and manufacturing sectors. It wouldn't be surprising if these travails prompted distracting hostilities with its failed-state neighbor, Pakistan. Pakistan, with its inexhaustible supply of Islamic maniacs could easily start a rumble with some crazy caper like the Mumbai hotel assault of two years ago, but this time India would answer with a heavy cudgel, perhaps even a nuclear sortie designed to neutralize Pakistan's dangerous toys at a stroke. And that would be that. Like cleaning out an annoying neighborhood crack house. It's not a very appetizing scenario, but what else can you do about failed states with nuclear bombs?

Turning to Japan....That sore beset kingdom is suffering all the blowback of modern times at once: the Godzilla syndrome up in Fukushima; a demographic collapse; an imminent bond crisis; the collapse of export market partners; and a long, agonizing death spiral of its banks. I stick by a prediction I tendered back in March, after the deadly tsunami: Japan will decisively opt for a return to pre-industrial civilization. Why not? The rest of the world will be dragged kicking and screaming to the same place. Let Japan get there first and enjoy the advantage of the early adapter - back to an economy of local, hand-made stuff, rigid social hierarchy, folkloric hijinks in whispering bamboo groves, silk robes, and frequent time outs for the tea ceremony.

Russia? The big bear might have just sat out another decade and enjoyed its remaining fossil fuel supply, but the temptation to project power is a demanding habit, so they make all sorts of noises about watching Iran's back - though mutual hatred abounds - and generally rushing into the power vacuum occupied by a US with dwindling mojo. There were stirrings of political discontent just few weeks ago, after the rigged early rounds of national elections, and who knows where that will lead. Vlad Putin has held things together there impressively after the meltdown of the 1990s, but apparently the tranquil veneer is thin. Except for two big cities, the sprawling nation is broke and decrepitating, with little to offer the world but oil and gas - not an inconsiderable offering, but one with certain limits especially as they drain their oil fields for export cash. The rule of law is also pretty sketchy there. The government, as ever, is a kind of gangster affair, only this time one that allows some people to get really rich, not just connected. Their 70-year experiment with Marxian dogma has probably put them off ideology for a few centuries to come, which means less money spent on prisons for people with independent thoughts and more for call girls and home furnishings. I imagine that Putin will maintain his grip through the year. The Russians will appreciate relative order more when they see a few other countries devolve into internal conflict.

I don't see much action around South America this year. Some Americans are already fleeing to Argentina. Perhaps they'll enjoy it, but there is always the menace of property confiscation, and worse. Brazil will continue to appear vibrant while it grows more population, shoving it toward eventual ruin. They will see setbacks in the development of their deep-sea oil due to an international shortage of investment capital.

Mexico's fortunes depend on its oil industry, Pemex, which faces remorseless depletion. Revenue from oil production and (dwindling) exports can't hope to keep up with continuing population growth (and ever more poverty). These trends suggest a continued loss of control for the central government and more territorial fighting among the drug gangs and other criminal mafias. As long as all those loose heads roll on the south side of the Rio Grande the US will just tut-tut off to the side. But if the gangs get bold and start venturing cross border to make mischief we will make like Woodrow Wilson did and send the regular army down to spank them. It would be a satisfying diversion for that portion of the US demographic that enjoys Ultimate Fighting on TV, though it won't get them their job back at the Pontiac plant.

The global oil picture is not so reassuring. The fragility of our supply is simply unnoticed by commuters enjoying Lady Gaga on their iPods. Meanwhile, our politicians retail fantasies of endless domestic reserves, which is total horse shit. Global exports are in remorseless decline, apart from geopolitical fissures and strains that could just paralyze allocation cold. If a hot war breaks out in the Middle East, you'll see the American supermarket shelves empty in three days. Won't that be fun. Note, too: the manias over shale oil and shale gas will reveal themselves as just more bubbles in a long cavalcade of bubbles, and both will begin to founder on a shortage of investment capital. The shale plays will prove to have been a national self-esteem-building program, not any part of an energy policy.

The abiding question as we turn the corner into the New Year is: how come Jon Corzine is still at large? (Not to mention Angelo Mozilo, plus the entire executive floor of Goldman Sachs, and about 5000 other assorted Wall Street grifters still on the loose.) There is plenty of dire talk that the collapse of MF Global, and the shenanigans around its demise involving the evaporation of segregated accounts, has gravely and permanently damaged the entire investment industry, but especially the commodities funds, who can no longer depend on the Chicago Mercantile Exchange to honestly clear trades and regulate behavior. The whole affair, and the thundering silence from the oval office, makes Barack Obama seem not just inept but somehow complicit in the looting of America. As if he needs another mark of discredit in his record of consistent fumbling. There are signs that a lot of people who still have something resembling money invested in various funds will go to cash in the weeks ahead, including under-the-mattress style. The distrust and paranoia is palpable now, with the frenzies of Yuletide bygone for another year. After all, why trust banks, especially the TBTF monsters. Such a mass move could take the starch even out of highly manipulated equity markets.

Nemesis may have her day, though. Jamie Dimon might have just gone a swindle too far for the fates to ignore him another year. JP Morgan looks to be in a peck of trouble for its role in the confiscation of MF Global accounts, not to mention its hijinks in the precious metals markets. The impudence of these rascals! In a nation when all sorts of people are murdered every day for little more reason than being in the wrong place at the wrong time, is it not a wonder that some poor swindled Grampa with nothing left to live for has not tossed a Molotov cocktail through the window of a Wall Street watering hole known to be frequented by banking poobahs? Perhaps this sort of action awaits us in 2012.

Longtime readers of this blog know how much I love predicting the Dow Jones Industrial Average to crash down to 4000 every year. I never disappoint - though I am often disappointed. In 2011, the SP index managed the delightful trick of finishing a fraction below its previous January kickoff. The stock markets have churned in range-bound purgatory for a decade while the price of a jar of pickles has multiplied four-fold. Applying the calculus, and given the pickle-DOW differential, I'd say my call was actually pretty good. In any case, this year I change the tune slightly: I predict the DJIA will go to 4000, with the catch that the number is only a way-station to 1000, which it will hit in 2014. We may be short of snow here in the Northeastern US - thanks to La Nina - yet not short of confidence that the mills of the Gods grind slowly, but grind exceedingly fine.

Finally, look for the publication of my next book round July 2012, a non-fiction work titled Too Much Magic: Wishful Thinking, Technology and the Fate of the Nation... from The Atlantic Monthly Press. In a week, I begin work on World Made By Hand 3.

Good luck to you in 2012, and report any suspicious characters adorned with ear-plugs, quetzel feathers, and carrying obsidian knives to your nearest office of Homeland Security.

http://kunstler.com/blog/2012/01/2012-forecast-bang-and-whimper.html

2012-01-01T10:39:00.000-08:00

Happy New Year friends!

2011-12-26T09:53:00.000-08:00

A Christmas Carol 2011
By James Howard Kunstler
on December 26, 2011 7:52 AM

Slouched in woe beside the Christmas tree, a lot of Americans missed the point of 2011: Santa Claus had already emptied his goodie sack before the night of wonders and miracles arrived and was back at the North Pole checking the balance sheet to see if he could raise a little cash selling some remaining assets off to the Blackstone Group or maybe work a leveraged buyout deal with Kohlberg Kravis Roberts. A few elves would have to join the unemployment line, but they could probably get by on half-rations of food stamps. Or maybe Henry Kravis could feed them reindeer steaks... at a discount, as long as they last.

It's remarkable how the year's great mega-holiday blowout suspends time and circumstance. I didn't see how the European banks were going to make it to December 25, but then, heading into the shopping frenzy home-stretch, swap lines opened up between the US Federal Reserve and the European Central Bank and around $600-odd billion in ZIRP loans flowed to over 200 Euro banks. Maybe that will cover the next two weeks of aggregate debt rollovers, and then what? They can't even look forward to President's Day over there - unless we rented out the George Washington and Abe Lincoln brands to them.

Who is still not impressed with the ability of these central banks, and their owner-operators, to keep re-circulating immense loads of notional money? Alas, every wash-rinse repeat cycle leaves the certificates a little paler and thinner, and it won't be long before they just appear to be blank paper. But rackets as grand and insolent as these would not be possible, except in a culture so estranged from truth that anything goes over without notice. I wonder about that scene around the American Christmas tree, though - the empty space between the floor and the lowest boughs where the gaily-wrapped presents used to appear.

I reckon it will take a few weeks, perhaps through the whole winter, for a sense of swindle to set in among the rooked. You may notice a pervasive undertone of grumbling in the background - and winter is the right time for that - like the eerie, ominous chords of ice groaning in the darkness on a still night around the frozen lake. But eventually come the tumults and torrents of spring. I suppose what baffles many of us in the ethers of bloggery is the apparent failure of that demographic slice acquainted with thinking to register any objection to the travesties and organized brigandage's of these times. At any other time in the life of this republic, such folk with active frontal lobes would have identified arrant criminal activity for what it is. Apparently, the nostrums of Paul Krugman are as powerfully narcotic as the raptures of Nascar.

I'm afraid events are a little too far gone now. There was some hope that Mr. Obama would restore the rule of law, but he has gone even farther in the opposite direction by disabling even the levers of truth - and in so genial a style that nobody noticed that, either. That thinking demographic slice of the public I averred to must have mortgaged their souls the past three years just to keep on keeping on. Hence, when the truly rooked wake from their zombie sleepwalk, there will be hell to pay for sure. Sometimes an intellectual governor on events no longer even avails, as was the case in the French Revolution. When the lawyers, political theorists, and philosophers got into the act, the blood really flowed.

Will that happen here, in the months and years ahead? I do think so. We've grown ourselves a toxic aristocracy of privilege and mega-wealth as cheeky (or worse) than the fops and strumpets of Versailles. I confess, I feel a bit lusty for some Grand Guignol action myself. There are stock figures in The New York Observer's weekly "Shindigger" column who I would enjoy seeing treated after the manner of Vlad III, Prince of Wallachia, the celebrated "impaler." And what better place for it than Zuccotti Park, a much more intimate venue than the agoraphobia-inducing Place de la Concord. You see what happens: in the absence of the rule of law even prudent men turn to the reptile agencies of mind.

The truly interesting thing about America's romance with our Wild West was that there was always an Unwild East to return to - if you survived adventuring in one piece. Well, first the frontier closed about 100 years ago, and now we wake on Christmas morning to discover that the whole land, from sea to shining sea, has gone feral with rot. Enjoy this nebulous week of suspended animation while it lasts. I'll be back next Monday with the 2012 forecast.

http://kunstler.com/blog/2011/12/a-christmas-carol-2011.html#more

2011-12-12T15:18:00.000-08:00

At CTC Junkyard with Mr Giersch...

2011-12-12T10:09:00.000-08:00

Carpenter's Bluff Bridge...from OK side...

2011-12-12T09:56:00.000-08:00

The Cookie Crumbles

By James Howard Kunstler
on December 12, 2011 9:28 AM

A lot can happen in two weeks, which is what remains before the glorious orgy of gifts, sugar plums, and roast goose. Imagine what a global bank run would do for that ole holiday spirit - not to mention the GDPs of the world. Oh, weeping celestial choirs! I suppose we generally assume that God Almighty himself would move heaven and Earth to prevent such a dire convergence of Christmas and a banking collapse, but perhaps the Old Diety is asleep at the switch like the US Department of Justice, the SEC, and a whole alphabet load of other watchful regulators in this, our only known universe.

Reality is a harsh mistress. She insists that you pay attention and then, having done so, take care of business. Politics, on the other hand, is more like stage magic. The man in the tuxedo is always trying to divert your attention. The world has run out of money, that is credible money of the type that represents real wealth, and yet is up to its ears in paper representations of putative wealth-like stuff: mortgages, credit default swaps, Gold ETFs, synthetic CDOs, naked shorts, bonds of all sorts. And now, alas, at Christmas time, the world has gotten a margin call and needs to fork over a whole lot of collateral in order to demonstrate that the global system of financial obligations is legit. Only the collateral turns out to be all this dubious paper, really just a bouquet of promises to pay in distant future Tuesdays for trillions of hamburgers today.

Nobody who observed the proceedings in last week's European Union talks came away from that spectacle feeling reassured. Brussels is like a ventriloquist's dummy sitting on Germany's knee. Germany cannot just step up and act like the Boss of Europe. Too many bad memories of an earlier instance, when a gang of maniacs wearing uniforms studded with grinning totenkopf insignia turned the whole region into a charnel house. So, Germany has to pretend to speak through Brussels. The message was: listen up all y'all nations of the Eurozone! Prepare to live on a whole lot less than you're used to! Do not exceed your borrowing and spending! Or else!

Yes, the lingering question: or else...what?

It is safe to say that nobody believed this mummery. Anyway, Great Britain (a.k.a. Old Blighty) simply checked out. The sceptered isle is now Europe's dog-house. They stayed out of the Euro currency for a reason: so that their equivalent of Wall Street, the City of London, could short the shit out of it when the time came, a strategy that begins to look absolutely brilliant - except considering what Old Blighty is otherwise left with as an economy: Scotch whiskey, mints, and a whole lot of Hallel grocery shops, with the Royals as window dressing. (I'd sooner invest in Argentina, with its amber waves of grain.)

The old animosities are leaking out of Pandora's History Box. Stolid Angela Merkel is stepping on Nikolas Sarkozy's size 14 ½ neck - how long before he starts to buck and holler? The astrologasters cannot come up with any math that shows Italy can meet its forthcoming debt payments. But they are only the leaders of a deadbeat posse that includes virtually everybody else in EuroClub, except perhaps Holland, Germany, and Finland. Could they really start beating up on each other with armies again? It would appear unthinkable. But that is exactly why the First World War destroyed the morale of Western Civ in 1914, too, after the Long Peace that followed the Napoleonic Wars. You're standing there on a lovely street corner in Verdun and the unthinkable whaps you upside the head. So much for the quality of advanced thinking in the Modern Age. Maybe its Poland's turns to rule the world?

In any case, the storyline is as much about the banks as the nations they are in. The banks are at the point where they can conduct business with each other only by pretending that exchanges of value are taking place. Nobody sees any lines of depositors forming on the sidewalks outside their branch offices, but then again nobody can see the digital zeros and ones streaming through the fiber-optic cable, either, and that's certainly where the action is. For the moment that action has a direct line into the perceived greater safety of Wall Street. Oh, yeah, follow Jim Cramer's advice and buy buy buy. Invest in a nation of lawless slobs with a two-second attention span oscillating between Nascar and the Real Housewives of Beverly Hills.

Did you catch President Obama on 60 Minutes last night. Charming fellow. Sincere and even purposeful, too. But displaying a big patch of cluelessness, like virtually everybody else in a position of authority in this benighted land. The President intimates that we will surely return to the turbo economy of a fast-receding yore. He is missing something big there. We are not going back to that. The fiesta is over. And his job is not to try to go back there, because it is impossible. His job was to lead an epochal re-set of the economy to a very different disposition of things, smaller, finer, more local. It is so far outside the box he's in that light-years cannot even begin to describe the distances involved. And I completely dismiss his claim that the reason no prosecution of Wall Street misconduct happened was because, however odious their schemes and scams were, they were technically legal.

Anyway, I'm already looking forward to the nominating conventions of next summer, when angry mobs of the swindled and desperate descend on Charlotte and Tampa like ravaging locusts. Won't that be a wake up call!

And now to bake all my Christmas Cookies.

http://kunstler.com/blog/2011/12/the-cookie-crumbles.html

2011-12-12T09:22:00.000-08:00

Kossa, Koshare, & Kwahadi Native Dance Groups from back in October...

2011-12-05T10:34:00.000-08:00

Driftwood down in the ravine...

2011-12-05T10:28:00.001-08:00

Suspended Civilization

By James Howard Kunstler
on December 4, 2011 6:23 PM

Question du jour: why is Jon Corzine still at large? In what fabulous Manhattan restaurants has he been enjoying plates of cockscombs and lobster with sauce hydromel and cinghiale ai frutti di bosco, while less well-connected citizens of this degenerate republic have to order their suppers from the dumpster in the WalMart parking lot where they have been living lately.

Is there still an Attorney General in this country? Will somebody please follow Eric Holder down a hallway and see if he leaves a trail of sawdust on the floor. Or did congress just retract all the fraud statutes by stealth in the same way that the Federal Reserve handed out $7.7 trillion in bailouts back in 2008 (much more than the generally accepted figure of the $800 billion TARP) without anyone finding out until three years later when some Bloomberg reporters rooted the numbers out of a Freedom of Information Act (FOIA) filing. And by the way, what is the US Federal Reserve doing handing out billions of dollars to the Royal Bank of Scotland? Was Scotland admitted to the Union by stealth, too? Or did Jamie Dimon just buy it as a birthday present for Barack Obama, who likes golf.

This is what life in the USA is like nowadays: shit happens and shit un-happens, and you find out about it years later. Only a desperate and hopelessly degenerate nation would choose to live this way, in a law-optional society, in which money means everything, and yet nobody even knows what money is (or where it goes, and what it does when it goes there.)

Jon Corzine has not revealed the destination of the loot (somewhere between $600 million and $2.5 billion, estimated) that vanished from the "segregated" accounts of his many clients at MF Global. The rumor is that it went to cover a rude margin call from Jamie Dimon's bank, JP Morgan, after JC took some unfortunate positions in European sovereign bonds in a bad month. Beyond the question of why Mr. Corzine is not in jail (as a flight risk, just like DSK) is how come the Department of Justice has not so much as issued a statement saying that they were looking into the matter, so as to reassure both the victims and the financial markets that this is not a culture that just makes shit up as it goes along - i.e. that we have predictable rules and formal procedures for doing stuff.

The clowns and villains who run America have accomplished something really epic: they have vanquished meaning. Nobody knows what anything means anymore. Anything goes now. All bets are off. It's not reassuring. It leads to bad things happening like blood in the streets. When nothing means anything anymore, some people will actually strive, make an effort, to reestablish meaning in practical economic and political life, because civilized life is impossible without it. So, in those historic moments when civilization is suspended, people will work like hell to restore meaning. Sometimes though, like Germany in the 1930s, you discover that the suspension of civilization is itself intoxicating, and you ride with that for a while.

Things are really flying apart now, and just in time for Santa Claus. The European bond rollovers are about to come in fast and furious during the season of Advent and nobody can make their interest payments. They will be skipped or postponed and promised for "next Tuesday," and yet the bizarro universe of credit default swaps will not be triggered - is there a counter-party on God's green earth who could afford a pay-out? Of course not. It was all a charade. So we'll just learn that there actually is no "insurance" on all this paper. Yesterday's "hair-cut" will be tomorrow's "throat cut" as the middle innings of suspended civilization play out.

There are heroes as-yet-sung-and-unsung in America, people who prefer reality over reality-TV, people with a taste for meaning in life, which often requires the recognition that some things are true and some not so true, and you're better off with what's true. What appears to be true is that the old order is finished and a new disposition of things is coming along. The Long Emergency will beat a path straight to the Great Re-set. Sign up for it. Roll up your sleeves. There is so much to do in this country. If you are young, especially, it's all waiting for you.

http://kunstler.com/blog/2011/12/suspended-civlization.html

2011-12-05T10:27:00.000-08:00

...in the ravine behind the lakehouse...'

between Matador and Quitaque...

2011-11-26T19:56:00.000-08:00

The Blue Bus Is Calling Us

By James Howard Kunstler
on November 20, 2011 7:40 PM

Zeez European politicians unt economists all zound like rocket scientists wiss all zeir charming euro-chatter. But zey must be quite dumb to machen zuch an unglaublich scheiße sturm of zee système financier. Che cazzo è?

Surely all the pretending nears its dire conclusion. Everybody is broke and everybody is in hock up to his prefrontal lobes and everybody is whirling around the drain over in the grand continental theme park of lovely cities and great eats. I'm sorry, but I don't see how they can stop the hemorrhaging as we slide into the season of holiday enchantment.

Every bank (and its uncle) is dumping everybody's sovereign bonds as though they were discovered to be croissants imported from a leper colony. Feh...! Folks of all stripes and accents desperately seek to move their money to some safe harbor - but where is this cozy mooring? To the US for the moment perhaps; but what happens Monday morning when the markets react to the weekend news that the US Senate super-committee has been utterly unable to agree on decisive action that would forestall the scheduled massive automatic budget cuts built into this red-white-and-blue doomsday machine - not to mention the ratings agencies threats to knock UST-paper down another notch upon such failure. Oy yoy yoy!

Just to be plain here: nothing is working. The global system of accounting control fraud has completely unraveled. Nobody will lend money to anybody anymore because everybody suspects everybody else is lying about their ability to meet any obligation. The whole world has become a daisy chain of schnorrers and schmiklers. All those hundreds of trillions of dollars in credit default swap insurance (ha!). Worthless and pointless, because now that a Greek default of at least 50 percent, officially, has failed to ignite a payout, then no default will. Instead, you'll just get cascades of un-hedged defaults. All the lawyers who ever lived could litigate until the sun turns into a red dwarf and they will never resolve these swindles, and the money represented in them will be so far gone that not even Ray Kurzweil in full Singularity mode will encounter a trace of it in his eternal travels through a zillion parallel universes.

So much for the hedge fund industry. I hope the folks who ran those cute operations enjoyed their years in Fairfield County, Connecticut, and Saddle River, New Jersey, because in a few weeks they'll be disguising themselves as OWSers in some makeshift urban encampment in order to line up for three-day-old bagels. Personally, I look forward to test-driving a few $5000 "must-sell" pre-owned Lamborghini Sesto Elementos, not that I'd actually buy one. The nimble might even score some bargain beachfront property in the Hamptons.

It's been about a fortnight now since John Corzine's MF Global fund went up in a vapor, including a reported $800 million or so (rumored to be actually more like $2+ billion) filched out of clients portfolios that cannot be accounted for - though there are additional rumors that it constituted a batch of collateral that was liquidated a micro-second after its arrival at JP Morgan, which had lent Corzine's firm enough money to buy the rope that it hung itself with. Notice, the story has completely disappeared from the mainstream news media (while the Kardashians soldier on).

Even poor Gerald Celente, chief of the Trends Journal forecasting group, arch-nemesis of "the white-shoe boys" got snookered in the action when MF Global somehow ended up with custodial care of the Gold ETFs Gerald was collecting and his shit just vanished! I heard him fulminating over it on a podcast and he is not somebody I'd want to be on the bad side of. Up until now, Celente was only commenting on the prospects for revolution in the streets. Now, I daresay, he'll be out in front leading it (or perhaps rappelling down Jamie Dimon's security wall with a straight razor clenched in his teeth).

The MF Global case has fast-tracked the evaporation of trust in all the places, large and small, where American One-percenters stash their cash. The redemption orders must be flying through their transoms like radioactive black swans. By lunchtime tomorrow this could include all the TBTF banks. That's what the pundits mean by "contagion." Where will that money go now (if they can get it out)?

I don't see where else it can go now except to shiny yellow and white metal, and maybe some oil positions. But the mechanisms of the precious metals trade have also been monkeyed with, and you'd best be careful where you place your order. As for oil, if lending really does seize-up, then letters-of-credit will not be issued and tankers will not be moving any product. More to the point, the global revolving debt system has depended on colossal transfers of ultra-short-term borrowed money. If short-term borrowing is simply unavailable, things could go south very quickly - and by that I mean food stops arriving at the supermarkets, which hold just a three-day supply. Wouldn't that make for an interesting Thanksgiving?

I have admittedly painted an extreme picture this week. But this week presents the most extreme convergence of events the world has seen since September of 2008, and perhaps a good bit worse.

http://kunstler.com/blog/2011/11/the-blue-bus-is-calling-us.html

2011-11-25T18:09:00.000-08:00

Dickens of a Christmas ongoing in downtown McKinney...

complete with fake snow!...LOL...

thru Sunday 10-6...

2011-11-23T08:18:00.000-08:00

McKinney's Equine unit a few years back...

2011-11-19T09:22:00.000-08:00

Rudderless

By James Howard Kunstler
on November 14, 2011 7:42 AM

The Penn State football sex scandal, and the depraved response of the university community at all levels, tells whatever you need to know about the spiritual condition of this floundering, rudderless, republic and its ignoble culture.

For nine years, head coach Joe Paterno covered up a grad student's report of having witnessed former assistant coach Jerry Sandusky anally raping a ten-year-old boy in the athletic department's shower room. The grad student, Mike McQueary, didn't bother to call the police. He was later hired as Paterno's defensive coordinator. Two other Penn State administrators were informed about the rape and let the incident slide, after which Sandusky went on to a lively career in serial child homosexual rape. For many years after the witnessed incident, he was permitted regular access to Penn State's gyms, fields, and locker rooms, while cherry-picking victims from his own foundation, Second Mile, for needy children.

The intersection of America's fake warrior culture of football with the nation's fake moral and ethical culture is instructive. It has many levels, like a convoluted freeway intersection of on-ramps, off-ramps, and merge-ramps.

First is the pretense that college football is a character-building endeavor. Rather it's an odious money-grubbing racket that chews up and spits out quasi-professional players who, with rare exceptions, only pretend to be students. It corrupts everyone connected with it. College football is little more than a giant conduit for vacuuming money out of alumni, hawking brand merchandise, and generating TV revenues. At Penn State, the racket sucked in about $70 million a year net profit. All over America, the old land-grant diploma mills pay their coaches million-dollar salaries, while academic adjunct professors can't even get health insurance. At SUNY-Albany, the flagship campus of New York's system, they got rid of the department of foreign languages, but the football team plays on. Meanwhile ordinary students rack up tens of thousands of dollars in unpayable college debt via a related racket in which free-flowing government-backed Sallie Mae loan money prompts colleges to boost tuition rates way beyond inflation rates.

Then there is the merge-ramp between religion and football. Was I the only person revolted by video of the phony "prayer" session held in the Penn State stadium just before Saturday's "big game" with the University of Nebraska? Players from both teams led by Jesus-shouting cheerleaders affected to "pray" for Jerry Sandusky's rape victims, an exercise that was joined and legitimized by the crowd with all the passion of a Nuremberg rally. When that easy little ritual was out of the way they could settle back and enjoy the game's ersatz heroics with a clear conscience, and the tailgate barbeques that followed. A genuine sense of collective shame would have produced a different course of events - for instance cancelling the game, maybe the rest of the season, or perhaps even the entire football program in plain recognition of how foul and corrupt it is. That decision would have been up to the university's board of trustees and tells you all you need to know about corporate leadership in America today.

Perhaps even more disgusting than the pre-game prayer show was the rash of demonstrations the night the story broke. These weren't about shame and repentance, just violent displays of sanctimonious "moral" support for an entire system in disgrace. Do you suppose these people could not have endured a night or two of uncomfortable silent reflection. And why didn't the new president, or any other campus executive, make a pubic statement that all the prideful carrying-on was indecent? I wonder how many of the same students will be ground down to dust by the weight of their unpayable college loans.

Equally disgusting was the cable news media's wall-to-wall coverage of the Penn State story, as if there weren't other important events going on in the world - for instance the resignation of two European prime ministers due to a political crisis that could sink the global economic system. CNN turned the Penn State story into an instant reality-TV show, with play-by-play action and spin-o-rama scenario-flogging aimed mainly, it seemed, at how Coach Joe Paterno might manage to wiggle out of culpability in the civil lawsuits that are sure to dog him now until the end of his days.

What the public doesn't know is how soon the sun will be setting on these giant universities in their entirety - football, classrooms, alumni golden circles, and all - as we enter the age of intense energy and capital scarcities. Remember: institutions, just like living organisms, often reach their greatest scale just before they go extinct. Resource constraints would be enough to get the job done, but it's interesting to see how our programming failures and internal moral contradictions have reached the last limits of flamboyant grotesquerie in the same exact moment.

This is a nation with psychological boundary problems in every realm - the family, the school, the government, the corporation, the diocese, the police station, you name it. Meanwhile the so-called fine arts branch of our culture valorizes "transgressive" behavior - as if there were any behavioral boundaries left to cross. Maybe Jerry Sandusky should be sentenced to a one-man show at the Whitney Museum. Then just wait a week or so: we'll get Jeffrey Dahmer, the Musical on Broadway.

Every new day that dawns lately gives further proof that we are a wicked people who deserve to be punished.

http://kunstler.com/blog/2011/11/-the-penn-state.html

2011-11-14T18:49:00.000-08:00

Last weekend was 2nd Saturday with a lot going on in the Square...a goodly number of people came in to see Brian Magnuson's "Cowboys of the Grand Canyon-the Winter Series" show at Laura Moore Fine Art Studio...if you missed it make time to go see it before it comes down in December...

This past weekend was also MAST weekend, and here a couple of students paint in Anne Royer's studio, below some folks checking out the sights and enjoying conversation at Guy Giersch and Pernie Fallon's place...

Another one of the highlights of the weekend was going to see Brian's "Camera Obscura" presentation at Laura Moore's...all in all a petty good time...

2011-11-11T11:48:00.000-08:00

Turkey, TX-the bus over on the right is Bob Wills old touring bus…

2011-11-10T16:05:00.000-08:00

Water is a finite resource...conserve when possible!

This image is of Lake Lavon back in 2006...thinking we don't want to go there again!

2011-10-29T11:20:00.000-07:00

Occupy Wall Street And The Demand For Economic Justice
Jeffrey Sachs | Oct 13, 2011 10:15 AM EDT

Around the world, young people -- students, workers, and the unemployed -- are bringing their grievances to the public square. The specific grievances differ across the countries, yet the animating demands are the same: democracy and economic justice. These demands will bring millions around the world together in protest and public education on October 15.

The young people occupying Wall Street and now protesting in several dozen American cities are not a "mob," the ugly deprecation thrown at them by Congressman Eric Cantor. They are channeling sentiments felt very widely throughout the country, indeed the world. Their defining message, "We are the 99 percent," draws attention to the way that the rich at the very top have run away with the prize in recent years, leaving the rest of society to wallow in wage cuts, unemployment, foreclosures, unaffordable tuition and health bills, and for the unluckiest, outright poverty.

It's not just the vast wealth at the top that they are questioning, but how that wealth was earned and how it's being used. Around 1980, the forces of globalization began to create a worldwide marketplace connected by finance, production, and technology. With globalization came new opportunities for vast wealth accumulation. Those with higher education and financial capital have generally prospered; those without higher education and financial capital have found themselves facing much tougher job competition with lower-paid workers half way around the world.

Yet these market forces, powerful as they are, have been only a part of the story. Politics has played a powerful role. In some countries, like the social democracies of Northern Europe (notably Germany, the Netherlands, Denmark, Norway, Sweden, and Finland), government policies have ensured that all parts of society can benefit from the new globalization. In others, notably including the United States, politics have amplified the surge in power and wealth of the new financial elite.

In the early 1980s, President Ronald Reagan greatly amplified the pressures of inequality by attacking unions, slashing top tax rates, and deregulating financial markets, just as globalization was beginning to pressure the poor and middle class. Backed by Washington, CEOs began to help themselves to stock options and compensation packages unimaginable in the past, equal to hundreds of times the pay of their employees. U.S. companies increasingly parked their international earnings in the Cayman Islands and other tax havens, with the knowledge and even connivance of the IRS. With politicians dependent on the corporations and CEOs to fund their campaigns, the forces of inequality unleashed by globalization and amplified by Reagan, have been left almost wholly unattended by the nation's politicians ever since.

We know what happens when greed feeds greed. Wall Street lost its scruples, if not its basic commonsense. Our marquee firms -- Goldman Sachs, Merrill Lynch, Citigroup, JP Morgan, AIG, Countrywide Financial, and others -- not only acted rapaciously but fraudulently, in an epidemic of corporate corruption. Yet many of the CEOs until today have not accepted responsibility or paid a price. Still they are guests at the White House state dinners, and their senior colleagues are the "bundlers" of mega-campaign contributions for 2012.
The sense of injustice, in short, is not just about the unfairness of a small part of society living in unimaginable wealth while so much of the rest of society lives in economic desperation. It's not just about the top 12,000 American households with more income than the poorest 24 million households. It's about the degradation of politics that turns wealth into power through campaign financing, lobbying, and the revolving door of business and government.
Vast inequality and the accompanying sense of injustice explain why the protests have also exploded in Chile and Israel, two countries doing rather well in economic growth and employment. Chile, Israel, and the United States are three of the five most unequal economies of the high-income world, together with Mexico and Turkey. As in the U.S., a small proportion of households in both Chile and Israel control an enormous proportion of the economy.
Protests come to the streets when the normal political channels are blocked. In Tunisia and Egypt, the blockage was the most severe: long-standing authoritarian rulers and their families keeping a tight grip on power (with the foreign policy support of the U.S. it should be mentioned). In the U.S. the blockage is vastly more remediable but insidious nonetheless. Americans elected a President promising change, but since the President and Congress fund their campaigns from Wall Street, Big Oil, and the health insurance industry, the change is unimpressive.

The survey evidence is overwhelming that Washington responds to rich constituencies rather than to the median voter, much less to the poor. And Congress itself is disproportionately wealthy -- almost half of members are millionaires. According to the opinion surveys, Americans by a strong majority want to raise taxes on the rich, end the wars, and protect the social outlays. Yet corporate lobbying mangles this clear call from the public. We end up with extended tax cuts for the rich, open-ended war, and agreements between the White House and Congress to gut civilian budget outlays in the coming decade.

No, Mr. Cantor, this is not a mob. These are America's young people, soon to be the nation's leaders, and they are telling us something about Washington's corruption, cronyism, and chronic mismanagement of the economy. With the exception of a few voices along with Warren Buffett, many of America's rich on Wall Street and beyond remain smug, self-satisfied, and intent on holding on to every last dollar of their vast fortunes.

America has rescued itself from undemocratic wealth twice before -- when the Gilded Age of the late 19th century was overtaken by the Progressive Era of the early 20th century, and when Hoover's economics and the Great Depression gave way to the New Deal in the 1930s, and then decades of economic prosperity that built a large middle class. The process of American renewal has begun anew.

Jeffrey Sachs is author of The Price of Civilization

2011-10-20T15:51:00.001-07:00

Going Apeshit

By James Howard Kunstler
on October 17, 2011 8:40 AM

It was amusing to see President Obama try to align himself with the OWS movement. The genial Millard Fillmore update asked them not to "demonize those who work on Wall Street." Of course, demonization proceeds from the failure of this president and his appointed agents in authority to subject those who work on Wall Street to the laws that mere mortals are supposed to follow in money matters. Hence, those who work on Wall Street appear to be something other than mortals. And since their work (on Wall Street) has had a malign influence on the common weal, some might leap to the conclusion that they are malevolent non-mortals, i.e. demons.

In this early stage of the convulsion rocking the western world, especially here in the USA, a peaceful ambience rules. That is because a game is being played. We played the game in 1968. It goes like this. You get people to turn out in the streets. The idea is to promote the right of public assembly as much as to make any particular point. (In fact, banners advocating all sorts of gripes appear.) Eventually, you get a lot of people in the streets. Feelings of happy anarchy sweep the crowd, a feeling that something special is underway, that the usual rules of everyday conduct have been suspended, in a good way. The crowd basks in the sunny glow of its own mass, happy solidarity. Everybody is behaving splendidly - more to feel good about.

After a while that gets boring, especially for young males with a lot of testosterone surging from loin to brain. They want to do more than bask in the radiance of their own righteous wonderfulness. They want to engage their large muscles, even if in the service of an idea, for instance the idea that they have been swindled. It is at first a vague idea, but large. But pretty soon it coheres emergently: swindled out of our future! Yes, it is so. Thousands of demon-like beings upstairs in the curtain-wall towers around Zuccotti Park, people wearing neckties and cultured pearls in warm offices with cappuccino machines down the hall, are at this very moment setting loose trading algorithms that will swindle us out of our future! You can see them up there at their evil, glowing screens!

That's when the yoga acrobatics and the hat crocheting are put aside and the street people - their ranks swollen into a horde-like meta-organism - start to express things beyond the right of public assembly. Something unseen goes through them, perhaps like the pheromone that transforms a field full of grasshoppers into a ravening swarm of locusts. Being people, they cannot take wing. But they can press forward and up against things, and they can surely break the glass in those sleek curtain-wall buildings (so much for "transparency") beyond which the bankers sit cringing in their expensive clothing.

Surely we are heading toward a moment like that. The bank employees upstairs must be getting a little nervous, anyway, just glancing out the windows at the moiling mob below. This is apart from the tensions internally roiling the banks themselves, not to mention the entire networked system of global banking, with all its fissures and cracks, as the merry-go-round of debt flies apart under the centrifugal force of insolvency. Come to think of it, these events could not have correlated more perfectly. Just as a horrific accident in finance is about to happen, a ready-made revolutionary mob is conveniently parked outside the pilot-houses of the world's great money vessels, so as to receive the crews directly into their open arms after the smash up.

President Obama could have changed the outcome if he had actually believed in change. He could have told his attorney general to enforce the securities law. He could have replaced the zombies at the SEC and told the new ones to apply all existing regulations. Before last year's election, he could have used his legislative majorities to repeal the Gramm-Leach-Bliley Act and reinstate the Glass-Steagall act. He could have initiated the process of deconstructing the giant banks back into their separate functions - so that banking once again worked as a utility rather than a launching pad for colossal frauds and swindles. Not only did he fail to do any of these things, he didn't even talk about it, or try.

Obama has a lot of nerve claiming to support the Occupy Wall Street movement. He should be one of the objects of its ire. I'm not even sure Obama will get to finish out his term of office. 2012 looks like a complete horror show in the making. The way world money matters are lining up this fall, some kind of debacle seems unavoidable, much worse than the 2008 fiasco. The normal political channels are clogged and sclerotic. Our institutions are failing us. The cast of "candidate" characters across the political spectrum convinces nobody that they can manage this republic.

The weather may determine the mood of the OWS crowd. If they don't go apeshit in the next two weeks, my guess is that the nation will hunker down into a dire, melancholy holiday season followed by a desperate winter leading to a raucous spring of political transformation - not necessarily of the best kind.

For the moment, we seem to be waiting for the proverbial first broken window.

http://kunstler.com/blog/2011/10/going-apeshit.html

2011-10-14T20:59:00.000-07:00

Between Silverton and CLaude...Palo Duro Canyon, south end...

2nd edit...

2011-10-11T09:55:00.001-07:00

Occupy Everything

By James Howard Kunstler
on October 10, 2011 9:17 AM

"Recession Officially Over," The New York Times' lead headline declared around 7 o'clock this morning. (Watch: they'll change it.) That was Part A. Part B said, "US Incomes Kept Falling." Welcome to What-The-Fuck Nation. I suppose if you include the cost of things like the number of auto accident victims transported by EMT squads as part of your Gross Domestic Product such contradictions to reality are possible. Elizabeth Kübler-Ross, where are you when we really need you?

I dropped in on the Occupy Wall Street crowd down in Zuccotti Park last Thursday. It was like 1968 all over again, except there was no weed wafting on the breeze (another WTF?). The Boomer-owned-and-operated media was complaining about them all week. They were "coddled trust-funders" (an odd accusation made by people whose college enrollment status got them a draft deferment, back when college cost $500 a year). Then there was the persistent nagging over the "lack of an agenda," as if the US Department of Energy, or the Senate Committee on Banking, Housing, and Urban Affairs was doing a whole lot better.

This is the funniest part to me: that leaders of a nation incapable of constructing a coherent consensus about reality can accuse its youth of not having a clear program. If the OWS movement stands for anything, it's a dire protest against the country's leaders' lack of a clear program.

For instance, what is Attorney General Eric Holder's program for prosecuting CDO swindles, the MERS racket, the bonus creamings of TBTF bank executives, the siphoning of money from the Federal Reserve to foreign banks, the misconduct at Fannie Mae and Freddie Mac, the willful negligence of the SEC, and countless other villainies? What is Barack Obama's program for restoring the rule of law in American financial affairs? (Generally, the rule of law requires the enforcement of laws, no?)

Language is failing us, of course. When speaking of "recession," one is forced into using the twisted, tweaked, gamed categories of economists whose mission is to make their elected bosses look good in spite of anything reality says. I prefer the term contraction, because a.) that is what is really going on, and b.) the economists haven't got their mendacious mitts around it yet. Contraction means there is not going to be more, only less, and it implies that a reality-based society would make some attempt to acknowledge and manage having less - possibly by doing more.

Instead, our leaders only propose accounting tricks to pretend there is more when really there is less. The banking frauds of the past twenty years were a conspiracy between government and banks to provide the illusion that an economy based on happy motoring, suburban land development, continual war, and entertainment-on-demand could go on indefinitely. The public went along with it following the path of least resistance, allowing themselves to be called "consumers." They also went along with the nonsense out of the Supreme Court that declared corporations to be "persons" with "a right to free speech" where political campaign contributions were concerned - thereby assuring the wholesale purchase of the US government by Wall Street banks.

Praise has been coming in from all quarters for the peacefulness of the OWSers. Don't expect that to last. In the natural course of things, revolutionary actions meet resistance, generate friction, and then heat. Anyway, history is playing one of its little tricks by simultaneously ramping up the OWS movement in the same moment that the banking system is actually imploding, with the fabric showing the most stress right now in Europe. I shudder to imagine what happens when OWS moves into the streets of France, Germany, Holland, Italy, and Spain.

All of the action right now has the weird aura of being an overture to the year 2012, fast approaching as we slouch into the potentially demoralizing holidays of the current year. I don't subscribe to Mayan apocalypse notions, but there's something creepy about the wendings and tendings of our affairs these days. OWS is nature's way of telling us to get our shit together, or else. This means a whole lot more than bogus "jobs" bills and Federal Reserve interest rate legerdemain. It means coming to grips with the limits of complexity and purging the system of the idea that anything is too big to fail. What happens when Occupy Wall Street becomes Occupy Everything, Everywhere?

http://kunstler.com/blog/2011/10/occupy-everything.html

2011-10-08T22:25:00.000-07:00

It was a pretty fun night at Laura Moore Fine Art Studio tonight as Pernie Fallon and her mentor Steve Napper enjoyed the opening of their show "Journey Into Color" with some friends and students...if you didn't make down for 2nd Saturday by all means try and see the show before the end of the month...

More to come!

2011-10-06T10:36:00.000-07:00

The former Alaska Governor and VP candidate sent the following letter to her supporters on Wednesday:

October 5, 2011
Wasilla, Alaska

After much prayer and serious consideration, I have decided that I will not be seeking the 2012 GOP nomination for President of the United States. As always, my family comes first and obviously Todd and I put great consideration into family life before making this decision. When we serve, we devote ourselves to God, family and country. My decision maintains this order.

My decision is based upon a review of what common sense Conservatives and Independents have accomplished, especially over the last year. I believe that at this time I can be more effective in a decisive role to help elect other true public servants to office – from the nation’s governors to Congressional seats and the Presidency. We need to continue to actively and aggressively help those who will stop the “fundamental transformation” of our nation and instead seek the restoration of our greatness, our goodness and our constitutional republic based on the rule of law.

From the bottom of my heart I thank those who have supported me and defended my record throughout the years, and encouraged me to run for President. Know that by working together we can bring this country back – and as I’ve always said, one doesn’t need a title to help do it.

I will continue driving the discussion for freedom and free markets, including in the race for President where our candidates must embrace immediate action toward energy independence through domestic resource developments of conventional energy sources, along with renewables. We must reduce tax burdens and onerous regulations that kill American industry, and our candidates must always push to minimize government to strengthen the economy and allow the private sector to create jobs.

Those will be our priorities so Americans can be confident that a smaller, smarter government that is truly of the people, by the people, and for the people can better serve this most exceptional nation.

In the coming weeks I will help coordinate strategies to assist in replacing the President, re-taking the Senate, and maintaining the House.

Thank you again for all your support. Let’s unite to restore this country!

God bless America.

– Sarah Palin

http://marklevinshow.com/Article.asp?id=2303165&spid=32364

2011-10-03T20:28:00.001-07:00

2011-10-03T15:57:00.000-07:00

Between Silverton and Claude...

Entering Palo Duro canyon from the south end...

2011-10-03T15:44:00.000-07:00

Here Come the OWSers!

By James Howard Kunstler
on October 3, 2011 8:24 AM

All last week across the media landscape, in pod, blog, flat-screen, and crunkly old newsprint columns, fatuous professional observers complained that the Occupy Wall Street marchers "have no clear agenda" or "can't articulate their positions." What impertinent horseshit. I saw a statement on one OWSer's sign that said it all:

$70,000 College Debt

$12,000 Medical Bills

I'm 22

Where's My Bailout?

What part of that is unclear to interlocutors of what we called "the establishment" back in the day? That would be the day of the Vietnam War and the Aquarian Upsurge. One difference being that in 1968 we at least had some solidarity in the older generation coming from figures of gravity like Senators Robert Kennedy (bumped off), Eugene McCarthy, J. William Fullbright, George McGovern, Rev Martin Luther King (bumped off), and even one US Attorney General, Ramsey Clark. Today, the entire "establishment" is a clueless, hopeless blob of self-interested, craven opportunism. Even the arty fringe - the people who pretend to be an avant-garde- are nothing but narcissistic self-branding operations masquerading as culture leaders.

The worst offender this past week was the prating empty vessel Nicholas Kristoff at The New York Times who affected to offer the OWSers his own tidy agenda of nit-picky, arcane tax reforms (e.g "Close the 'carried interest' and 'founders' stock' loopholes") and limp-dick banking regulations (e.g. "[move] ahead with Basel III capital requirements"). David Plotz and his Gen X sidekicks at the Slate Political Podcast were equally mystified. I have some heartier suggestions: bring the full weight of the RICO act and the federal anti-fraud statutes down on Lloyd Blankfein, Jamie Dimon, Brian Moynihan, Angelo Mozilo, and a host of other impudent schmekels still at large in their world of Escalade limos and Gulfstream vistas. Or, if that's just too difficult, how about a handy lamppost and about 40 feet of stout nylon cord?

It is cosmically ironic, of course, that the same generation of Boomer-hippies that ran in the streets and marched through the maze of service roads around the Pentagon has become a new "establishment" more obtuse, feckless, greedy and mendacious than the one they battled with over 40 years ago. I guess they just don't see that their time has come to get right with reality - or get shoved aside and trampled. The essence of the OWSer's argument is pretty simple: they've got a raw deal; somebody dealt them a bad hand; someone ran their society into a ditch and not a goddammed one of the older generation will set in motion the machinery to correct the situation, or even acknowledge it.

At the apex of this new establishment is the Baby Boomer's moral trophy president: Barack Obama, whose election made the Boomers feel good about themselves - while they preceded to loot the national treasury's accumulated capital, and then reach forward a few generations to rob their legacy, too. I haven't heard Nicholas Kristoff (or any of his colleagues at The New York Times) complain about Mr. Obama's stupendous inattention to the crimes of Wall Street, or to the dereliction of his proconsuls in the SEC and the Department of Justice. I'd at least send somebody to hold a mirror under Eric Holder's nostrils to see if he is actually alive.

For my money, the OWSers have plenty to yell about. Apart from the crimes and turpitudes of their elders, the younger generation hasn't even been prepared for the massive change in reality that these times are heaving them into. If it was me out there, I'd conclude that I'd better make up the future on my own, with no help from my parent's generation. In fact, that future is rushing toward all of us so cold, hard, and fresh even in this autumn season that it might splatter the banking establishment - and the global economy - like a bug on a windshield. The OWSers have a front row seat down there in lower Manhattan. The financial gangrene (thank you Zero Hedge) is not just seeping anymore, it's blowing through the arteries of the money underworld like fracking fluid. The damage can't be contained. Let the Arabs have spring. The OWSers of America own the fall. Rock on OWSers and don't let the "pigs" (as we used to call them) get you down.

http://kunstler.com/blog/2011/10/here-come-the-owsers.html

2011-09-29T19:49:00.000-07:00

Nice storm this evening...knew my arthritis was acting up for a good reason...had some serious fun capturing lightning...

2011-09-26T14:36:00.000-07:00

Now here's somethin you don't such much of anymore...

Brings back a lot of memories for me as my first job was at a drive-in theater...this one is just outside of Turkey, TX...

2011-09-26T14:18:00.001-07:00

Punked World

By James Howard Kunstler
on September 26, 2011 9:18 AM

Europe is a three-card monte game and Greece is the pea and for the moment I'd guess that the pea is under a walnut shell called France. Or the French banks, to be specific. Their vaults are stuffed with Greek bond paper that is giving the whole neighborhood a headache from a stench like unto rotting carp. Everybody else in the neighborhood has their own cache of deliquescing fish-heads, but they pretend the air is fresh and bracing. In fact, so exhilarating that they are avid to dump $3 trillion into a Euro bailout fund that will solve the problem of that fugitive aroma wafting down the boulevards.

Europe can really only put out stories at this point, and the $3 Tril bailout fund is just another story in a tedious string of them. Where are they going to get the money? From the machinists' union in Dusseldorf? The waiters and chambermaids in Munich? There's that rumored swap line opening from the Federal Reserve to the European Central Bank, but that's nothing more than a cheap loan window, and for a measly half a trillion ($500 billion - the late Senator Ev Dirkson is cackling in his grave). And where do those dollars come from anyway? Who is supposed to pay it back, and how? What kind of collateral is Ben Bernanke going to hold - the contents of the south wing of the Louvre? One hundred million free dinners (wine and tip included) at Taillevent? This game of musical chairs with a hot potato is not fooling anyone, really.

All it's doing is dragging out the process of the civilized world getting right with reality. Reality has a ledger and is calling in its notes. The civilized world can't believe this is happening, so they pretend it isn't, with pompous ceremonials among the highest level banking officials, and hollow declarations of heroic actions that are not the least heroic because all they are designed to do is protect their fellow bankers. It's certainly not for the sake of the nations involved, because the standard of living in all these countries will take a painful hit any way you cut it.

This mummery could dissolve in tears any moment, or it might stretch out one more month, but by going this route the leaders of Europe risk all kinds of pressures in the other seams of the system, namely markets. They are testing a 60-odd years long supply of the one indispensible resource: confidence. They've already probably squandered the little that's left. All signs point to a mega-Lehman moment when trust has fled and nobody will lend to anybody and business cannot continue. That'll be a freaky-deaky moment and it will be way worse than Lehman was. When it happens, what seemed financial will instantly go political. The rage of millions will shred the trappings of fakery, and for a while things will seem too real. The world has no idea how all this might resolve. What a show.

I can't imagine that the explosion in Europe will not affect the American banks - we've already shoveled hundreds of billions into the Euro bank vaults the past several years, apart from that new swap line. Anyway, Washington has ramped up a new game of charades to divert everyone at this end - another threatened government shut-down. If we don't cut this shit out, some Pentagon general is going to have to ride across the Potomac and call a time-out on the constitution. Financial chaos is not cool. Just so you know the sort of fate we are tempting with our shenanigans.

Speaking of the constitution, I'm getting a little sick of these corporate CEO knuckleheads who come on CNBC and complain that the US Postal Service is running at a loss, and therefore we should abolish it. There is actually little beyond all those post offices that holds the fabric of small town America together anymore. And anyway, delivering the mail is one of the few actual government services that is spelled out in the US constitution in no uncertain terms in Article One, Section 8. It doesn't say the postal service must run at a profit, by the way. The food stamp program is not spelled out in the constitution and it doesn't run at a profit. Neither does the war in Afghanistan (if you don't count the drug money). Congress runs at a profit, but not in any way that the constitution provides for. Before long, a lot of people are going to want to abolish it.

In the meantime, can anybody answer this question: where is the Tea Party of Progressives? Why are the Nascar morons and Jesus jokers the only people in this country who can mount an aggressive political movement? Will somebody please step up and take the baton?

http://kunstler.com/blog/2011/09/punked-world.html

2011-09-25T20:05:00.000-07:00

Scenes from Oktoberfest...

2011-09-21T12:38:00.000-07:00

Surveying her domain...

2011-09-20T20:49:00.000-07:00

A few more from the trip...

2011-09-16T15:35:00.000-07:00

Some scenes I photographed in the Caprock Canyon area recently...

2011-09-15T14:35:00.001-07:00

Between Matador and Quitaque...
This area of the country is drought stricken really badly!!...

2011-09-15T14:34:00.000-07:00

Seeing Stars

By James Howard Kunstler
on September 12, 2011 8:34 AM

I don't want to be party pooper, but is it possible that all the 9/11 remembrance hoopla was a kind of weekend refuge from reality for this psychologically spavined nation? Memorializing is easy; acting resolutely in the here-and-now is another matter. To me, the various 9/11 doings that radiated out over the media gave off an indecent odor of triumphalism - a correspondent of mine referred to it as "self-important histrionics." We seem to put on these shows because we don't know what else to do, and because the only truly effective homegrown industry left in the USA is public relations, the business of making your own reality.

The trouble is that reality accepts no substitutes (as the old ad jingle goes). It does its thing regardless of whether you acknowledge it or not. I was in Mexico City mid-week and sojourned behind the Zocolo at the ruins of the Templo Mayor, headquarters of the New World's champion people-eater, Huitzilopochtli, a bad-ass muthafucka of a god if ever there was one. The Aztecs had everything going for them except their reality, at the center of which was this bloodthirsty hallucinated monster demanding fresh beating hearts by the hundred-weight. And so, consumed by this insane myth, a half a million of them allowed themselves to be destroyed by three hundred adventurers from Spain.

Strange to relate, the environs of the ruined pyramid was the most tranquil spot in the entire super-gigantic permanent catastrophe of Mexico City. Old Huitzee would like these times, I thought: a bad moon rising and plenty of fresh meat everywhere. The way the stars were lining up, a pitiless deity could really get his mojo on. It made my skin crawl, I hardly know where to start this week.

I'll yield to the obvious, then, and turn to President Obama's jobs speech. I don't believe for a minute that it added up to much beyond more political game-playing - although there is more than one game being played judging by the knuckleballs and downfield juke-moves displayed by Mr. O. You can throw in some rope-a-dope, too, since the main objective was to make a virtue out of weakness. So, the Republican-dominated congress will pass a few fragments of the proposals (probably some tax cuts and maybe even unemployment extensions) but they'll wrinkle their noses at everything else and the result will barely make a difference - given the nature of this economy, which is having its Thelma and Louise moment. Obama will claim that the nation was gyped, and the Republicans will claim that they were just following the orders of party chairman the Hon. Jesus H. Christ.

None of them has a clue that reality has other plans for the US economy, which is to contract, de-globalize, downscale, and go local. That so-called economy they're trying to bring back? It's gone, baby, gone. I saw the remnants of it in the supermarket yesterday afternoon, endless freezer displays of unbelievable food-like shit such as Fridays © frozen fried cheddar-stuffed jalepeno poppers and something called "Rattlesnake Pasta." What kind of people are we? Is Huitzilopochtli behind all this, fattening us up for the altar? The fact that chili peppers are involved makes me suspicious. Anyway, this trip to the supermarket was like a visit to some unholy museum. A lot of the stuff behind those glass freezer doors I'd never actually noticed before, and surely never imagined in my wildest Iron Cheffantasies. In a few years, when the US public has become accustomed to a diet of cabbage soup and corn-pone, the memory of all that will astonish us.

As to Mr. Obama's delivery, I wish he would give up that little vocal trick he employs of constricting his windpipe so as to sound extra-special sincere. In fact, every time he puts that phony voice on, I discount what he is saying, such as you would if listening to a speech by Pinocchio and seeing his nose grow at every utterance. The non-entity former governor of New York, George Pataki, who mounted a seventeen-minute campaign for president a month or so ago, also favored that speech-delivery trick. All it accomplished was to make him look like he was straining himself to appear authentic. Note that the most self-consciously clueless political podcasters in the whole pod-world, the jokers at The New Yorker Magazine's podcast, gave Obama super props on delivery. For them, it was all about public relations, of course. They have no idea what kind of economy is greeting us in reality. Not your grandpa's Wheel of Fortune Rotary Club extravaganza, I assure you, Rick Hertzberg and Ryan Lizza. They're thrilled that Mr. Obama may finally be getting John Maynard Keynes right. OMG....

The stars are lined up now pointing straight at the tragic heart of Europe. I really don't quite see how the Euro currency gets through to the end of this week. German government officials are making noises about an orderly bankruptcy in Greece. What do they mean by that? Does Greece walk into its lawyer's office with a tidy list of assets for sale? Say, the Parthenon, assorted caryatids, the contents of the Thessalonica Country Club's trophy cabinet, and Uncle Nikos's fabulous stamp collection? I don't think so. More likely, you can expect an unholy shit-storm of credit default swaps setting every bank in the OCED (and few outside it) on fire, and by extension every executive mansion, until you turn around on Saturday morning and the world's currency system looks like an incinerated slice of smoldering wonder bread. It was a wonder that the Euro nations could keep their end of this unholy racket going as long as they did, since their constitution doesn't even allow bail-outs, period. Anyway, it is nowhere recorded in the annals of Bernal Diaz or the Aztec codexes that Huitzilopochtli liked sandwiches. He was a straight-up barbeque deity, though a little molé on the side goes nicely with a plate of human thigh.

http://kunstler.com/blog/2011/09/seeing-stars.html

2011-09-13T21:18:00.000-07:00

Just returning from a trip up near Caprock Canyon...north Texas is parched and drought stricken...had a great trip, but hate to see what is happening to that area of the state

2011-09-02T21:54:00.000-07:00

Tropical Storm Lee

http://www.wunderground.com/tropical/tracking/at201113.html

2011-09-02T21:51:00.000-07:00

Hurricane Katia...

http://www.wunderground.com/tropical/tracking/at201112.html

2011-09-01T16:27:00.001-07:00

Tropical Storm Katia...

2011-09-01T13:26:00.000-07:00

The Invest now has an 80% chance of development, per NHC.
http://www.nhc.noaa.gov/

2011-08-30T12:13:00.000-07:00

Tropical Storm Katia

Tropical Depression #12 has been upgraded to Tropical Storm Katia early this morning as the entire system is better organized. Currently there is 15 to 20 knots of shear affecting Katia and this shear is forecast to decrease by later today and tonight with intensification likely from this afternoon into this weekend. It is anticipated that Katia will reach hurricane strength during the day Wednesday and major hurricane strength by late this weekend.

Katia is tracking west-northwest at a forward speed of 16 to 17 mph and the storm is being steered by a ridge of high pressure located to the north. Yesterday, all of the global model guidance pointed to a likely scenario of Katia being steered out to sea due to a upper level low pressure system located over the central Atlantic. Since then the global models are trending towards a weaker and less amplified upper level low pressure system that lifts out with a ridge of high pressure rebuilding to the north of the storm. The latest GFS model forecasts a track that takes Katia to the north of the Leeward Islands and severely impacts Bermuda next Thursday. The European operational model forecasts a track that takes Katia to the north of the Lesser Antilles and then on a track northward halfway between the US East Coast and Bermuda. The ensemble members of the European model are further west than the operational model and imply a very close brush with the US East Coast with a 10 day forecast position of 28 North Latitude, 73.5 West Longitude. Two things to point out are that any further shifts to the south in the forecast track will put the northern Leeward Islands, the Virgin Islands and Puerto Rico at a significant threat from Katia. All of our friends in the northeastern Caribbean should closely monitor Katia. The second is that given the trends in the upper air pattern forecast, I suspect we may see further shifts to the west in the forecast track of Katia by the model guidance. It is way, way too early to be confident or certain on any one forecast track for Katia.

As of this morning, I am still leaning towards a track that takes Katia very close to, if not right over the northeastern Caribbean on Sunday and Monday followed by a track that takes Katia just east of the Bahamas next Wednesday and then northward near the US East Coast late next week and next weekend. The highest threat areas after moving away from the northeastern Caribbean for Katia are Bermuda, the Canadian Maritimes and possibly eastern New England.

Potential Development In The Gulf Of Mexico Late This Week Into This Weekend:

I am closely monitoring an area of disturbed weather in the northwestern Caribbean that is forecast to track into the Gulf of Mexico within the next 48 hours and potentially develop into a tropical storm this weekend in the western Gulf of Mexico. All of the global model guidance are now on board with this type of scenario with the GFS model forecasting a track that slowly moves along the central and western coast of Louisiana late this weekend and then along the Texas coast as we get into Monday and Tuesday. The European model, on the other hand, forecasts that this system will track onshore into south Texas next Tuesday as a upper end tropical storm or a hurricane. The NAM model, for what its worth, forecasts that this disturbance will track into the Gulf of Mexico during the day Wednesday and develop into a tropical depression or a tropical storm by Thursday. The NAM model also forecasts that this system may develop quickly as it nears the Texas coast by this weekend.

Given the fact that we have a tropical disturbance in the northwestern Caribbean that will track into the Gulf of Mexico by Wednesday and also that environmental conditions are expected to be quite favorable in the Gulf of Mexico this weekend; I think the chances of tropical development is fairly high. The NAM model may be a little fast with the development and I foresee a scenario that this develops into a tropical storm as it nears the Texas coast on Sunday and Monday and takes advantage of the geography of the coast to create an increase in spin. Where on the Texas coast could this potential tropical storm make landfall? I am leaning towards the central and lower Texas coast given the overall synoptic setup of high pressure to the north.

What is potentially awesome news is that the Louisiana and Texas coasts may receive some much needed rainfall this coming weekend into next week. I will be monitoring this tropical disturbance over the coming days and will keep you all updated.

http://www.crownweather.com/?page_id=4557

2011-08-30T12:03:00.000-07:00

Katrina in Vermont

By James Howard Kunstler
on August 29, 2011 8:34 AM

Note to readers: I'll run an update at the bottom of this blog over the next few days.

* * *

The same creeping nausea that followed the CNN 'all clear' sign in New Orleans six years ago happened again yesterday. Anderson Cooper seemed a little peeved that the lights didn't go out in Manhattan, but then the remnants of Hurricane Irene stomped up the Hudson Valley and stalled a while and commenced to rip apart the Catskills, the eastern Adirondacks, the Mohawk and upper Hudson valleys, and then almost all of Vermont, not to mention New Hampshire and western Massachusetts, and I can't even tell you much about whatever's going on in Pennsylvania, Virginia, Delaware, and Maryland this morning. Connecticut, Long Island, and Rhode Island are in there somewhere, and surely there's more than a few things out of place in North Carolina.

This is nowhere near Katrina's death toll of over 1800 souls, but the damage to scores of towns, businesses, houses, and basic civic armature is going to be very impressive as the news filters in later this week and the disaster is still very much ongoing Monday, even with the sun shining bright. Towns all over Vermont and New Hampshire are still drowning. The Hudson River is still on the rise. The Mohawk River is at a 500-year flood stage and is about to wipe the old city center of Schenectady, New York, off the map. Bridges, dams, and roads are gone over a region at least as big as the Gulf Coast splatter-trail of Katrina.

That story is still developing. A lot of people will not be able to get around for a long, long time, especially in Vermont and New Hampshire, where the rugged terrain only allows for a few major roads that go anywhere. Even the bridges that were not entirely washed away may have to be inspected before people are allowed to drive over them, and some of these bridges may be structurally shot even if they look superficially okay. There are a lot of them. If you live in a flat state, you may have no idea.

The next story is going to be the realization that there's no money to put it all back together the way it was. The states don't have the money. The federal government is obviously broke, and an awful lot of the individual households and businesses will turn out to not have any insurance coverage for this kind of disaster where it was water, not wind, that destroyed the property. I don't know what the score is insurance-wise along the mid-Atlantic beachfront towns - but remember, insurance companies were among the biggest dupes of the Big Bank mortgage-backed securities racket, and when the new claims are toted up they may find themselves in a bail-out line.

This is a warning to America that the converging catastrophes of climate change, energy scarcities, and failures of capital formation add up to more than the sum of their parts in their power to drive a complex society into a ditch - no matter what a moron like Rick Perry might say. But, of course, political ramifications will follow. There will be a lot of pissed-off people in the Northeast USA. Maybe they'll even start giving the grievance-bloated folk of Dixieland some competition in the politics of the bitter harvest. Oddly, the Siamese twin states of Vermont and New Hampshire are political polar opposites. Vermont, the land of Ben and Jerry's ice cream, and other squooshy culture tropes from the attic of Hippiedom, is about as Left-progressive as it gets. New Hampshire's license plate says, "Live Free or Die," and that same draconian mood defines the state's politics: hard Right. It's like a few counties of Georgia shook loose and drifted north somehow. My guess is that the political rage will be about equal on both fronts, as folks are left stranded, or homeless, or without a going business they thought they had only a day or so ago. And my further guess is that their mood will afford some insight into the extreme impotence, incompetence, and mendacity of both major political parties. As I've said before in this space, think of these times as not unlike the convulsive 1850s, preceding the worst crisis of our history.

Apart from the fact that the hurricane season is just gearing up, and that a procession of tropical storm blobs has commenced to pour out of West Africa, there is that other alternate universe of storms, brushfires, and fiascos called the fnancial system, which everybody sort of forgot about over the weekend. Well, it's ba-a-a-ck this morning, too, and the financial weather was deteriorating sharply last time I looked. You can stick a fork in the Euro Zone. Bank of America is panhandling for spare change like a dying wino as it whirls around the drain. Nobody knows what the shadow bets on all this action is, but you can bet on one thing for sure: the counterparties can't pay.

Oh, by the way, anybody remember that we had an earthquake here in the Northeast a few days before Irene rumbled in? Probably not, unless part of your building fell off. God's wrath, some might say, as we beat our path to a world made by hand.

Tuesday August 30

God's wrath, all right. Michelle Bachmann said it, wouldn't you know.

Vermont got whacked badly, as did the northern Catskills. Whole towns drowned, localities cut off from the rest of the world by road and bridge washouts. Lots of buildings of all kinds lost. As is the case with these disasters, many people out there now who have lost everything, are poorly insured, and have no idea how they are going to carry on. It will be several more days before the scope or this thing is really comprehended. It lacked a single dramatic focus, the way that the Superdome galvanized the nation's attention after Katrina struck, but I suspect the damage to the region is just as bad.

For excellent photos of flooding in upstate New York, go to the Albany Times Union's coverage here. For coverage of Vermont, go to the Burlington Free Press.

More tomorrow....

http://kunstler.com/blog/2011/08/katrina-in-vermont.html

2011-08-30T11:33:00.000-07:00

Wunderdog is not sure what to think about all this! :)

2011-08-26T09:45:00.000-07:00

A look at Hurricane Irene this AM...

The Cone

Computer models with prospective path...

2011-08-25T09:22:00.000-07:00

History is Not Your Therapist

By James Howard Kunstler
on August 22, 2011 8:36 AM

I suppose we'll know in a few hours whether Colonel Muammar Gaddafi gets hung out to dry, Mussolini-style, from a lamp-post, or is mercifully handed a one way ticket to Palookaville, a.k.a. The Hague, where old despots go to eat French fries with mayonnaise and be judged. The rebels celebrating in Tripoli's main square looked a tad ticked off about all the trouble it took to pry the old rascal off his throne. Over in Syria, Bashar al-Assad, the ophthalmologist who rules the place, must be following developments with a keen interest. (Perhaps he will hastily decide to re-open his medical practice in, say, Iraq.) Despite the bubbling of CNN news-readers, I suggest that we Westerners hold our applause until the world gets a clue as to who or what will govern Libya (or Syria, in the event).

Besides, we have a sort of Man-Who-Would-Be-Gaddafi fresh out of the woodwork right here in the USA. I speak of Texas Governor Rick Perry, the Bush-Without-a-Brain clone who pulled off a kind of "hat-trick" of cretinism last week by 1.) announcing his disbelief in climate change science; 2.) announcing his disbelief in evolution science; and 3.) more or less threatening to lynch Federal Reserve chairman Ben Bernanke. The nation has not seen such a puffed up rogue take the stage since the days of Huey Long, but the rural idiocy that saturated Louisiana in the 1930s has finally seeped all over the country so that even people in once-literate Minnesota are represented by reality-averse evangelical maniacs. Candidates like Perry and Bachmann make a plain vanilla narcissist like Sarah Palin look at least capable of running a student council. What a low moment in America's history. Don't lose sight of the fact that there's room for the bar to go further down.

Otherwise, the weekend was notable for the complete and utter retreat from public view of European leaders charged with figuring out some way around the EU's banking woes. The dirty secret is that there isn't any way around these Alp-size heaps of broken promises, worthless certificates, overdrawn accounts, shiftless governments, and booby-trapped counter-party contracts. The people in charge are trying like hell to make it through the vacation season before the entire continent tips over, but then what? I'll tell you: the chain-lightning of ruin will crackle across the Sargasso Sea and strike deep in the heart of JP Morgan, Bank of America, Goldman Sachs, Citi, and all the other citadels of grift until blood runs out the bronze nostrils of George Washington's statue on the portico of Federal Hall. I don't begrudge poor Barack Obama's attempt to eat a few ice cream cones at the seashore with his wife and two girls. Some presidents are just one-termers. History is cruel that way. But it also rhymes. Rick Perry may be as dumb as Ronald Reagan.

Nobody can believe what's happening. Nobody knows what to do. Well, here's some straight dope: do you want to have an economy? Then prepare to cut your losses and move on. There's so much to do "out there" in America, but the catch is it's not the same as what we've been doing. Do you want to eat a few years from now? Get serious about reorganizing agriculture on a smaller, finer, more local scale. Believe me, there will be plenty of jobs. Only they won't be like sitting in a cubicle writing a marketing plan for a video-game about the slaughter of gym rats from another planet. Do you want to be able to travel around this big country in a few years? Start working on the nearest reconstructable railroad line - and get over your techno-grandiose fantasies about running all the cars on algae, corn, or the plug in the wall. Do you want have some household goods in the future without sending an order halfway around the world? Figure out a way to make stuff in some North American place where there is running water for electric power.

There isn't a politician out there, including the Paul duo, who can really articulate the direction in which history is propelling us. This "recession-depression" narrative doesn't even adequately capture it. This is the end of a certain way of doing things - the industrial growth-spurt fiesta. We're in permanent contraction now. There are no technological rescue remedies that will restore the old economic regime. The banks are not working anymore because we can't create more real wealth, and the wealth we pretended to create for thirty-odd years in the form of IOUs can't be paid back into existence. We can't fund any more senior golfing careers and a lot of people will have to just stop eating fried pork rinds, guzzling Pepsi Cola, and then waddling into the emergency room for consolation.

Does this sound a little harsh? Surprise: history is not your therapist. This is the New Age you never expected. Crybabies need not apply.

http://kunstler.com/blog/2011/08/history-is-not-your-therapist.html

2011-08-18T15:34:00.000-07:00

Ms Ragusa was over for a short shoot last night and brought her awesome MUA friend Ms McLellan with her...more beauty dish work...

Thanx for the time and the help ladies! :)

2011-08-15T15:57:00.000-07:00

I'm thinking its time for another road trip...

2011-08-15T15:42:00.001-07:00

High Corn

By James Howard Kunstler
on August 15, 2011 9:47 AM

Looking every inch the Assistant Manager of a J.C. Penny, Rick Perry of Texas stepped on-board the touring evangelical freak show that the Republican pre-primary parade has turned into. I like to think of him as George W. Bush without all the encumbering intellect. I give it three months before media snoops catch him in bed with Michele Bachmann. The two of them will claim it was all right because Jesus was there as chaperone and anyway, "...alls we did was watch the Vikings-Cowboy game...."

Oh these sons and daughters of the high corn! Make no mistake (to borrow a favorite war cry from the presidential cheat sheet), both of these heartland bozos are dumb enough to lead America straight into the graveyard of failed states. Imagine a summit between Rick Perry and whoever succeeds Hu Jintao - the incredulous side-glances of the Chinese leader and his interpreter when Mr. Perry presents the official gift from our nation: a miniature Bible made by the inmates at Stringfellow State Prison and "prayed over by qualified preachers twenty-four hours a day!" Or how about Michele Bachmann and Vlad Putin. I'd sooner watch a gerbil in a terrarium with a King Cobra.

Meanwhile, the other day poor Mitt Romney tried to explain to a crowd of Iowa hot-heads that "corporations are people!" Wasn't that just the right thing to say to folks whose employment opportunities have dwindled down to eviscerating chickens on an assembly line or humping boxes on the WalMart loading dock for $8 an hour. He was heckled mercilessly. I don't see how a candidate recovers from that kind of caught-on-camera mockery - but then again, in a culture that has no shame, just about anything goes.

One thing I'd really like to know about the Republican party, though: if they're so all-fired up about fiscal rectitude and the honest disposition of money, and stuff like that, then how come not a single one of these dissembling ninnies has suggested the investigation and prosecution of the entire Wall Street matrix of swindling grifters - including the officials who rotate between the too-big-to-fail banks and the regulatory agencies like the SEC and the CFTC and all the other utterly failed official watchdogs who stood by whistling Dixie while the future of this country was blatantly sold down the river?

Of course, nobody on the Democratic side asks anything similar of President Obama as he hops from fundraiser to fundraiser. I'd like to know why the fuck the president is even out campaigning more than a year before the election. And hasn't the mainstream news media noticed that there's something a little peculiar about a cycle of perpetual election with no governing in between? I suppose everything is show business now, though I don't expect this aberrant and very dangerous behavior to persist, because virtually all the major operations of the supposedly civilized, "developed" world are veering into a state of obvious failure.

The global financial system is wobbling on its pyramid-tip of debt. Europe is trapped. The members of the currency union can't make good on what they owe and neither can they surrender their independence to some jerry-rigged extra-national authority. At stake is the European banking system and the post-World War Two amity that allowed the region to become the lovely tourist theme park we lately know it as. They are running out of tricks for pretending that debts can revolve forever, and as this occurs the fear rises that the whole lovely thing will bust apart in mob violence, revolution, and maybe even armed conflict between people who don't hold their forks the same way. England is not even in the Euro currency club but five decades of rather feckless immigration policy have resolved into something that looks an awful lot like race war. God knows what the French are thinking, with their own massive immigrant slum population ringing Paris.

Anyway, whatever happens around Europe in the months to come, trouble with its banks is sure to blow back into the American ones, which are hopelessly entangled in Europe's obligations, not to mention skeins of supposed "insurance" swaps contracts primed for ignition at the slightest flap of a black swan's wing that could propel the likes of Lloyd Blankfein's cappuccino machine from an upper floor at 200 West Street, NYC, through the roof, clear to planet Uranus. At least we'd have a space program again.

Surely a lot of European and American officials just want to escape to the seashore for the last two weeks of this punishing month and soak their heads in the surf - perhaps a few will decide to not come back up for air. President Obama will enjoy the briny vapors out on Martha's Vineyard, and maybe even splash around in the wimpy waves there. I'll enjoy the thought of him tying into a clam roll. And now to check how the markets are doing this opening day of the week...

http://kunstler.com/blog/2011/08/high-corn.html

2011-08-14T20:57:00.000-07:00

Brian Magnuson discussing his art with folks at the opening of The Edge...see more of Brian's work at http://bmagphoto.com/

The opening of The Edge was an event, both venues had heavy traffic with people standing outside on the street waiting to get in...a big thanx to all who came out to enjoy the opening!

Ellie Ivanova with her work at The Edge opening...See more of her work at http://parasolphotography.wordpress.com/

The Edge is on display August 13 - September 7, 2011...at Laura Moore Fine Art Studios at 107 S Tennessee and next door at 105 S Tennessee Suite #101.

Gallery Hours:

Mon-Sat 1-5pm

2nd Saturday 1-10pm

or by appointment.

2011-08-12T17:47:00.000-07:00

The Edge

Opening Night

Saturday, August 13th 7-10pm

Over 60 local and national artists responded to our open call. Come see each artist's unique interpretation of "The Edge".

"The Edge" is on display through September 7th in 2 locations: Laura Moore Fine Art Studios at 107 S Tennessee and next door at 105 S Tennessee. Same gallery hours both locations.

Laura Moore Fine Art Studios

107 S Tennessee

McKinney, Texas 75069

laura@lauramooreart.com

lauramooreart.com

214.914.3630

Gallery Hours:

Mon-Sat 1-5pm

2nd Saturday 1-10pm

or by appointment.

2011-08-11T10:39:00.000-07:00

Quinten and Will Lee at the Granada Theater, 2008...good times!!!

2011-08-10T14:22:00.000-07:00

Watching the Kossa, Koshare, and Kwahadi dance group's in Paris TX last night...was a great show!!

2011-08-09T10:12:00.001-07:00

Change You Don't Have to Believe In

By James Howard Kunstler
on August 8, 2011 8:00 AM

A waterfall of woe broke over all the realms of money last week - including especially the realm where we determine just what money is supposed to mean - and a lot of folks barely made it to a rooftop, or a floating log, or some scrap of high ground, where they sit wet and shivering, expecting to get slammed again. The torrent of events is still flowing and there are countless dangerous objects bobbing in it. Remember what that in-rushing ocean was like in the Fukushima tsunami? A wall of miso soup strewn with Toyotas and houses instead of squid rings and fish balls. Try swimming in that. (Try swimming in your Cuisinart on the guacamole setting.)

Europe is telling itself one cockamamie story after another. We've got a rescue fund! Only it has no money! But we will bail out Italy nonetheless! But Italy is too big to bail out - and we tried stuffing it under the carpet, but there's no more room with Greece, Ireland, and Portugal already suffocating in there. The whole G-20 is yakking on the phone as I write, hatching fresh cockamamie stories. Oh, now it looks like the European Central Bank will ride to the rescue with a dispatch satchel full of good intentions. They said the same thing last time, a month or so ago, when a caryatid fell on Greece's head. They are not so sure what money is either. Is a bond like money? Maybe not so much anymore. A stock portfolio? Feh! A Euro? The damned thing is starting to look like a ball-and-chain custom-crafted to weigh down Germans. (And, let's face it: they never did pay any of us for World War Two, really, except what they had to fork over to get the communist side of their own country out of hock. Their guilt-o-meter is still buzzing, I'm sure.) All I know is I hope the whole gang printed up some fresh lira, francs, marks, drachma, pesetas, punts, and whatnot. It would be nice to go back to one of these cute places some day at a discount.

Did you admire Standard and Poor's sly, Friday night downgrade of the United States Treasury bond rating? I was probably the only one in the whole country besides Anderson Cooper not out eating something bigger than my own head at Applebees, or watching the "Footwear Clearance" show over on the Shopping Network. However, I'm not the only one in America asking where do these S and P punks get off downgrading US bonds when three years ago they wore out their Triple-A rubber stamps on the cartloads of stinking offal that Angelo Mozillo and other mortgage rustlers were pawning off as bond-fodder on every Frankenstein "investment opportunity" pumped out of the Wall Street CDO mills. Government officials were righteously seething over S and P's chutzpah, but I suppose when they tried to ring-up Eric Holder over at the DOJ they got connected to some call center in Uttar Pradesh where a friendly fellow named "Dale" picked up. China's government-run newspaper virtually spanked the US: "Learn (thwack) to live (thwack) within (thwack) your (thwack) means!"

I'm not convinced that the US bond rating will even matter that much because nobody knows what anything is worth anymore - especially when governments teeter and the folks in the public square (or the parking lot in America's case), start yelling for blood. Merkel, Sarkozy, Berlusconi, Zapatero, will soon be swept away by that selfsame rolling torrent of dreck-strewn woe - in their case a bouillabaisse - while poor Obama looks like one of those hapless, floating creatures in the second-to-last scene of O Brother, Where Art Thou. Even the gold bugs are scared the price will collapse in a debt deflation, or that the federal government will slap a giant extra-special punitive capital gains tax on precious metal sales, or will try to confiscate it from the public altogether like Franklin Roosevelt did - though, given the vast arsenals of private firearms across this land, and the martial spirit lingering in many pissed-off factions of the Tea Party ilk, nothing would invite a revolution, or civil war, or civic upheaval as surely as trying to snatch folks' gold. As a capital preservation refuge, I'm sympathetic to gold, of course, though not so much to buggery.

Everybody is broke now: national treasuries, giant banks, pension funds, insurance companies. The wonder so far is that credit default swaps have not yet been triggered by interest rate changes or some other silly shit, but when that comes to pass there is no way the counterparties can settle their contracts. Ruin will thunder through the financial system like winged death. Everybody is broke and there's a lot less real "money" (whatever it is) out there. Everybody's quailing at the prospect of QE 3, in all its cosmic futility. The United States has already half killed itself at the Golden Corral steam-table of deep-fried debt. I guess we could go all the way and shoot what remains of the dollar in its pitiful, lolling head.

There is a welling recognition that the dice have been cast and the world has rolled snake eyes. The casino is on fire and a flash flood is boiling down the strip. It's no fun running to the exits only to find the revolving doors already eyeball deep in dirty water. America gibbers to itself but nobody has a clue. I'll try to help: this is a compressive financial and economic contraction (one is money, the other is activity). Late-summer storm that it is, it looks to be intensifying. Everything that's super-big is going down sooner or later. The exact sequence of failures is unpredictable. But you can be sure Nature is telling you to get local, get smaller, get finer, downscale, solidify your friendships, and drop your stupid grandiose fantasies about running WalMart on algae. This is change you don't have to believe in, because it is about to jump up and bite you on the lips.

http://kunstler.com/blog/2011/08/change-you-dont-have-to-believe-in.html

2011-08-06T15:14:00.000-07:00

S&P Downgrades US To AA+, Outlook Negative - Full Text

United States of America Long-Term Rating Lowered To 'AA+' On Political Risks And Rising Debt Burden; Outlook Negative

We have lowered our long-term sovereign credit rating on the United States of America to 'AA+' from 'AAA' and affirmed the 'A-1+' short-term rating.

We have also removed both the short- and long-term ratings from CreditWatch negative.

The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the Administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics.

More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges to a degree more than we envisioned when we assigned a negative outlook to the rating on April 18, 2011.

Since then, we have changed our view of the difficulties in bridging the gulf between the political parties over fiscal policy, which makes us pessimistic about the capacity of Congress and the Administration to be able to leverage their agreement this week into a broader fiscal consolidation plan that stabilizes the government's debt dynamics any time soon.

The outlook on the long-term rating is negative. We could lower the long-term rating to 'AA' within the next two years if we see that less reduction in spending than agreed to, higher interest rates, or new fiscal pressures during the period result in a higher general government debt trajectory than we currently assume in our base case.

Rating Action

On Aug. 5, 2011, Standard & Poor's Ratings Services lowered its long-term sovereign credit rating on the United States of America to 'AA+' from 'AAA'. The outlook on the long-term rating is negative. At the same time, Standard & Poor's affirmed its 'A-1+' short-term rating on the U.S. In addition, Standard & Poor's removed both ratings from CreditWatch, where they were placed on July 14, 2011, with negative implications.

The transfer and convertibility (T&C) assessment of the U.S.--our assessment of the likelihood of official interference in the ability of U.S.-based public- and private-sector issuers to secure foreign exchange for debt service--remains 'AAA'.

Rationale

We lowered our long-term rating on the U.S. because we believe that the prolonged controversy over raising the statutory debt ceiling and the related fiscal policy debate indicate that further near-term progress containing the growth in public spending, especially on entitlements, or on reaching an agreement on raising revenues is less likely than we previously assumed and will remain a contentious and fitful process. We also believe that the fiscal consolidation plan that Congress and the Administration agreed to this week falls short of the amount that we believe is necessary to stabilize the general government debt burden by the middle of the decade.

Our lowering of the rating was prompted by our view on the rising public debt burden and our perception of greater policymaking uncertainty, consistent with our criteria (see "Sovereign Government Rating Methodology and Assumptions," June 30, 2011, especially Paragraphs 36-41). Nevertheless, we view the U.S. federal government's other economic, external, and monetary credit attributes, which form the basis for the sovereign rating, as broadly unchanged.

We have taken the ratings off CreditWatch because the Aug. 2 passage of the Budget Control Act Amendment of 2011 has removed any perceived immediate threat of payment default posed by delays to raising the government's debt ceiling. In addition, we believe that the act provides sufficient clarity to allow us to evaluate the likely course of U.S. fiscal policy for the next few years.

The political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed. The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy. Despite this year's wide-ranging debate, in our view, the differences between political parties have proven to be extraordinarily difficult to bridge, and, as we see it, the resulting agreement fell well short of the comprehensive fiscal consolidation program that some proponents had envisaged until quite recently. Republicans and Democrats have only been able to agree to relatively modest savings on discretionary spending while delegating to the Select Committee decisions on more comprehensive measures. It appears that for now, new revenues have dropped down on the menu of policy options. In addition, the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability.

Our opinion is that elected officials remain wary of tackling the structural issues required to effectively address the rising U.S. public debt burden in a manner consistent with a 'AAA' rating and with 'AAA' rated sovereign peers (see Sovereign Government Rating Methodology and Assumptions," June 30, 2011, especially Paragraphs 36-41). In our view, the difficulty in framing a consensus on fiscal policy weakens the government's ability to manage public finances and diverts attention from the debate over how to achieve more balanced and dynamic economic growth in an era of fiscal stringency and private-sector deleveraging (ibid). A new political consensus might (or might not) emerge after the 2012 elections, but we believe that by then, the government debt burden will likely be higher, the needed medium-term fiscal adjustment potentially greater, and the inflection point on the U.S. population's demographics and other age-related spending drivers closer at hand (see "Global Aging 2011: In The U.S., Going Gray Will Likely Cost Even More Green, Now," June 21, 2011).

Standard & Poor's takes no position on the mix of spending and revenue measures that Congress and the Administration might conclude is appropriate for putting the U.S.'s finances on a sustainable footing.

The act calls for as much as $2.4 trillion of reductions in expenditure growth over the 10 years through 2021. These cuts will be implemented in two steps: the $917 billion agreed to initially, followed by an additional $1.5 trillion that the newly formed Congressional Joint Select Committee on Deficit Reduction is supposed to recommend by November 2011. The act contains no measures to raise taxes or otherwise enhance revenues, though the committee could recommend them.

The act further provides that if Congress does not enact the committee's recommendations, cuts of $1.2 trillion will be implemented over the same time period. The reductions would mainly affect outlays for civilian discretionary spending, defense, and Medicare. We understand that this fall-back mechanism is designed to encourage Congress to embrace a more balanced mix of expenditure savings, as the committee might recommend.

We note that in a letter to Congress on Aug. 1, 2011, the Congressional Budget Office (CBO) estimated total budgetary savings under the act to be at least $2.1 trillion over the next 10 years relative to its baseline assumptions. In updating our own fiscal projections, with certain modifications outlined below, we have relied on the CBO's latest "Alternate Fiscal Scenario" of June 2011, updated to include the CBO assumptions contained in its Aug. 1 letter to Congress. In general, the CBO's "Alternate Fiscal Scenario" assumes a continuation of recent Congressional action overriding existing law.

We view the act's measures as a step toward fiscal consolidation. However, this is within the framework of a legislative mechanism that leaves open the details of what is finally agreed to until the end of 2011, and Congress and the Administration could modify any agreement in the future. Even assuming that at least $2.1 trillion of the spending reductions the act envisages are implemented, we maintain our view that the U.S. net general government debt burden (all levels of government combined, excluding liquid financial assets) will likely continue to grow. Under our revised base case fiscal scenario--which we consider to be consistent with a 'AA+' long-term rating and a negative outlook--we now project that net general government debt would rise from an estimated 74% of GDP by the end of 2011 to 79% in 2015 and 85% by 2021. Even the projected 2015 ratio of sovereign indebtedness is high in relation to those of peer credits and, as noted, would continue to rise under the act's revised policy settings.

Compared with previous projections, our revised base case scenario now assumes that the 2001 and 2003 tax cuts, due to expire by the end of 2012, remain in place. We have changed our assumption on this because the majority of Republicans in Congress continue to resist any measure that would raise revenues, a position we believe Congress reinforced by passing the act. Key macroeconomic assumptions in the base case scenario include trend real GDP growth of 3% and consumer price inflation near 2% annually over the decade.

Our revised upside scenario--which, other things being equal, we view as consistent with the outlook on the 'AA+' long-term rating being revised to stable--retains these same macroeconomic assumptions. In addition, it incorporates $950 billion of new revenues on the assumption that the 2001 and 2003 tax cuts for high earners lapse from 2013 onwards, as the Administration is advocating. In this scenario, we project that the net general government debt would rise from an estimated 74% of GDP by the end of 2011 to 77% in 2015 and to 78% by 2021.

Our revised downside scenario--which, other things being equal, we view as being consistent with a possible further downgrade to a 'AA' long-term rating--features less-favorable macroeconomic assumptions, as outlined below and also assumes that the second round of spending cuts (at least $1.2 trillion) that the act calls for does not occur. This scenario also assumes somewhat higher nominal interest rates for U.S. Treasuries. We still believe that the role of the U.S. dollar as the key reserve currency confers a government funding advantage, one that could change only slowly over time, and that Fed policy might lean toward continued loose monetary policy at a time of fiscal tightening. Nonetheless, it is possible that interest rates could rise if investors re-price relative risks. As a result, our alternate scenario factors in a 50 basis point (bp)-75 bp rise in 10-year bond yields relative to the base and upside cases from 2013 onwards. In this scenario, we project the net public debt burden would rise from 74% of GDP in 2011 to 90% in 2015 and to 101% by 2021.

Our revised scenarios also take into account the significant negative revisions to historical GDP data that the Bureau of Economic Analysis announced on July 29. From our perspective, the effect of these revisions underscores two related points when evaluating the likely debt trajectory of the U.S. government. First, the revisions show that the recent recession was deeper than previously assumed, so the GDP this year is lower than previously thought in both nominal and real terms. Consequently, the debt burden is slightly higher. Second, the revised data highlight the sub-par path of the current economic recovery when compared with rebounds following previous post-war recessions. We believe the sluggish pace of the current economic recovery could be consistent with the experiences of countries that have had financial crises in which the slow process of debt deleveraging in the private sector leads to a persistent drag on demand. As a result, our downside case scenario assumes relatively modest real trend GDP growth of 2.5% and inflation of near 1.5% annually going forward.

When comparing the U.S. to sovereigns with 'AAA' long-term ratings that we view as relevant peers--Canada, France, Germany, and the U.K.--we also observe, based on our base case scenarios for each, that the trajectory of the U.S.'s net public debt is diverging from the others. Including the U.S., we estimate that these five sovereigns will have net general government debt to GDP ratios this year ranging from 34% (Canada) to 80% (the U.K.), with the U.S. debt burden at 74%. By 2015, we project that their net public debt to GDP ratios will range between 30% (lowest, Canada) and 83% (highest, France), with the U.S. debt burden at 79%. However, in contrast with the U.S., we project that the net public debt burdens of these other sovereigns will begin to decline, either before or by 2015.

Standard & Poor's transfer T&C assessment of the U.S. remains 'AAA'. Our T&C assessment reflects our view of the likelihood of the sovereign restricting other public and private issuers' access to foreign exchange needed to meet debt service. Although in our view the credit standing of the U.S. government has deteriorated modestly, we see little indication that official interference of this kind is entering onto the policy agenda of either Congress or the Administration. Consequently, we continue to view this risk as being highly remote.

Outlook

The outlook on the long-term rating is negative. As our downside alternate fiscal scenario illustrates, a higher public debt trajectory than we currently
assume could lead us to lower the long-term rating again. On the other hand, as our upside scenario highlights, if the recommendations of the Congressional Joint Select Committee on Deficit Reduction--independently or coupled with other initiatives, such as the lapsing of the 2001 and 2003 tax cuts for high earners--lead to fiscal consolidation measures beyond the minimum mandated, and we believe they are likely to slow the deterioration of the government's debt dynamics, the long-term rating could stabilize at 'AA+'.

On Monday, we will issue separate releases concerning affected ratings in the funds, government-related entities, financial institutions, insurance, public finance, and structured finance sectors.
http://www.zerohedge.com/news/sp-dow...tive-full-text

2011-08-02T18:26:00.001-07:00

WASHINGTON (AP) -- Moody's Investors Service said Tuesday that the United States will retain its triple-A bond rating following passage of legislation to boost the debt ceiling. But the agency put a "negative" outlook on the rating, raising the specter of a future downgrade.

Moody's said in a statement that the bill signed into law by President Barack Obama dealt with the immediate threat of a default that would have resulted from a failure to raise the country's borrowing limit.

But the agency assigned a negative outlook to the triple-A rating to indicate that there is still a risk of a downgrade if the government's fiscal discipline weakens or the economy deteriorates significantly.

http://finance.yahoo.com/news/Moodys-backs-US-tripleA-apf-2668047537.html?x=0&sec=topStories&pos=main&asset=&ccode=

2011-07-28T09:49:00.001-07:00

Nobody Knows Anything

By James Howard Kunstler
on July 25, 2011 9:17 AM

That sound you hear out there is spaghetti hitting the wall. Everybody wonders: will it stick? The European Union lobbed a wad of kartoffelkloesse at a Greek wall last week. The thud was impressive, but then the darn thing started sliding down the greasy wall to where a gang of CDS counterparty wolves waited, snapping and slavering for it. And then there was a crowd of curious Germans in the alley, wondering who stole their precious kartoffelkloesse and lobbed it at the Greek wall, anyway. Grumbles were heard but, as yet, no mob action against the flingers of the purloined kartoffelkloesse.

Here in the pitiful tweet-sphere that contains the atomized remnants of USA governance, there is no such clarity. We don't know if that's spaghetti hitting a wall or the shit hitting the fan. But due to the amazing obduracy of the parties involved, the next sound you hear may just be the wall itself tumbling down, perhaps even the famous wall with the famous street attached.

All I know is that I dumped a largish bundle of 13-week US treasuries on Friday, a tad shy of the August 4 rollover and moved the hypothetical cash into less freaky hypothetical foreign sovereign instruments. I found a great bid for the T-bills, too. The whole transaction cost me a buck. I wondered: what were these people thinking who bought this crap at just the moment in history when everything is flying into walls and fans?

Whatever other conclusions can be drawn from the great debt ceiling debate of 2011, the main one seems to be that this country can no longer govern itself. Our reverence for the constitution appears to be inflated along with everything else in the USA these days: gas prices, waistlines, cable TV bills. Even congresspersons themselves seem to hold it in low regard, since proposals for a "super-congress" were floated last week. A lot of sentient folk who follow national affairs actually wondered out loud, "what the fuck is that supposed to mean?"

I took it to mean that our faith in the apparatus of governing has evaporated at the same rate as faith in our promises to pay back stuff-of-value denominated in certificates called dollars, our faith in which also melts into air. One thing for sure everybody knows: this is not a good time of year for financial shenanigans and chicanery. The rough beast called Reality comes back from its vacation in foul and turbulent spirits. Things shake loose when it roars.

There is widespread and growing agreement that the two major political parties have reached the end of their useful lives. No other serious faction is waiting in the wings to replace them, except the one led by a claque of overfed radio clowns and know-nothing Jesus Jokers with an axe to grind against the wicked hosts of birth control. Seek no further for the answer as to why our political leaders are not serious: there is nothing they can do at this point. In order to conceal the reality of epochal economic contraction, they have run our money affairs off a cliff - and so the next sound you will hear may not be of things hitting walls and fans, but of a sickening crash, as the overloaded carriage of government (drawn by a scrawny coyote) spirals down into the Canyon of Lost Causes.

We need a financial convulsion to sweep away the accumulated debris of poor choices, false hopes, squandered resources, frauds, swindles, and lies. Such an event can't help but set off a true political convulsion. Let the banks eat their own tails and strangle to death. I hope somebody catches a photo of Lloyd Blankfein paddling a surfboard due south off Georgica Beach, destination: Fortaleza. I hope he brings a few Red Bulls with him for the trip, and perhaps a whiffle bat to hold off the sharks - if there are any left in overfished deep blue sea.

I post a few seconds before the markets' openings this ominous Monday. Gold is already riding high. The rest is largely up to the robots in Lower Manhattan and the zombies in Washington.

http://kunstler.com/blog/2011/07/nobody-knows-anything.html

2011-07-24T06:02:00.000-07:00

The Duchess...
Bob's Silverton 422...a beautiful boat...

2011-07-22T19:22:00.000-07:00

If you haven't done so yet its worth your time to go see Virgil Lampton's show at Laura Moore Fine Art on S Tennessee just off the square in downtown...

2011-07-21T16:11:00.000-07:00

"Photographers deal in things which are continually vanishing and when they have vanished there is no contrivance on earth which can make them come back again."
- Henri Cartier-Bresson

2011-07-20T21:45:00.000-07:00

Solar car races thru Thursday...

2011-07-19T07:31:00.000-07:00

The Amazing Dissolving Nation

By James Howard Kunstler
on July 18, 2011 10:07 AM

Going broke fast is a very compelling problem. For ordinary people it tends to induce chicken-with-no-head syndrome - a mad burst of pointless locomotion ending in sudden collapse. If the US debt ceiling is raised - which I think is a 90 percent bet - there will be a sigh of relief that resounds from the lobster pounds of Penobscot Bay to the parking lots of Silicon Valley... and poor dissolving America will still be stuck in its essential predicament of being broke. So a lot of pointless locomotion will continue in the form of positioning among a troop of clown candidates for the dumbshow of the 2012 election. I wonder lately whether that election will actually happen.

Europe is arguably worse off money-wise, more broke, flimsier, crapped out, crippled, and paralyzed. Sad, because in outward appearance Europe is - how shall I put this? - better turned out than America. Europe is a fit, silver-haired gentleman in a sleek Italian suit and a pair of Michael Toschi swing lace wingtips, holding a serious-looking Chiarugi leather briefcase. America is pear-shaped blob of semi-formed male flesh, in ankle-length cargo shorts, a black T-shirt featuring skull motifs, tattoos randomly assigned (as if by lottery) to visible flesh, a Sluggo buzz-cut, and a low-rider sports cap designed to make your head look flat. In other words, he lacks a certain savoir-faire compared to his European cousin. But both are broke. Neither has any idea what he will do next - though, for the American, it will probably involve the ingestion of melted cheese or drugs (or both). When the European collapses, a certain air of delicacy will attend his demise; the expired American will go up in flames in a trailer and they'll have to sort out his remains from the melted goop of his dwelling-place with a front-end loader.

This is the way the world ends for the OECD, the nations that affected to be developed and civilized. This phase of globalism is certainly not the end of history, but it is looking like the end of accounting tricks, and possibly democracy, which has discredited itself with accounting tricks. At a certain point in time, the sickening recognition sets in that appearances are not the same as reality - and then, all of a sudden, you're in a political maelstrom. Citizens of the various lands will discover that the money being argued over, shifted around from column A to column B, assigned to this or that actuarial table or budget line or account or obligation or vault or "structured vehicle"- that money is just... not... there. There's no money. It was pretend money. From now on, none of you will get paid. Imagine a world where nobody gets paid.

Europe has run the money string to its bitter end and now it just remains to be seen how each country blows up and where the dust settles. Greece and Portugal may just shrug and retire on an economy based on goat-cheese and olives. Ireland will get drunk and pass out for at least a century. Spain sinks back into an age-old catatonic daze, having gone broke spectacularly once before. Italy strings up Mr. Berlusconi on a lamp-post and breaks up into 112 warring city-states. France elects DSK, whose first act is to declare war on the City of New York. Religious wars leave England in embers. And Germany becomes the world's first "green" police state.

It's conceivable to me that Barack Obama may be the last president - for a while. He was a decent fellow but, in the end, ineffectual, and of course he got no help from the legislative branch, including especially colleagues in his own party, a most remarkable class of maundering chickenshits and grifters. Our money problems will not go away and after a while this land will not be governable by familiar means. In case you haven't noticed, the rule of law is already AWOL in many sectors of our national life, most particularly money matters, but before long on every street-corner, every highway strip, plus every GMO cornfield, and brownfield. The two parties are unreformable and the Tea Party is the stooge of one of the two parties, and there is no other party of earnest, decisive, and sane individuals anywhere near the horizon. So some kind of convulsion is in the cards and it will be the unfortunate duty of some dutiful officer to step in and set an agenda based on something other than bluster, fakery, and pocket pool.

While there's a good chance the US debt ceiling will be extended, it seems to me that meanwhile we have crossed an invisible line into a place where untoward things happen.

http://kunstler.com/blog/2011/07/the-amazing-dissolving-nation.html

2011-07-19T07:27:00.000-07:00

From the ongoing solar car race out at Texas Motor Speedway...

2011-07-14T19:12:00.000-07:00

Standard & Poor's has placed its 'AAA' long-term and 'A-1+' short-term sovereign credit ratings on the United States of America on CreditWatch with negative implications.

-- Standard & Poor's uses CreditWatch to indicate a substantial likelihood of it taking a rating action within the next 90 days, or in response to events presenting significant uncertainty to the creditworthiness of an issuer. Today's CreditWatch placement signals our view that, owing to the dynamics of the political debate on the debt ceiling, there is at least a one-in-two likelihood that we could lower the long-term rating on the U.S. within the next 90 days. We have also placed our short-term rating on the U.S. on CreditWatch negative, reflecting our view that the current situation presents such significant uncertainty to the U.S.' creditworthiness.

-- Since we revised the outlook on our 'AAA' long-term rating to negative from stable on April 18, 2011, the political debate about the U.S.' fiscal stance and the related issue of the U.S. government debt ceiling has, in our view, only become more entangled. Despite months of negotiations, the two sides remain at odds on fundamental fiscal policy issues. Consequently, we believe there is an increasing risk of a substantial policy stalemate enduring beyond any near-term agreement to raise the debt ceiling.

-- As a consequence, we now believe that we could lower our ratings on the U.S. within three months.

-- We may lower the long-term rating on the U.S. by one or more notches into the 'AA' category in the next three months, if we conclude that Congress and the Administration have not achieved a credible solution to the rising U.S. government debt burden and are not likely to achieve one in the foreseeable future.

-- We still believe that the risk of a payment default on U.S. government debt obligations as a result of not raising the debt ceiling is small, though increasing. However, any default on scheduled debt service payments on the U.S.' market debt, however brief, could lead us to revise the long-term and short-term ratings on the U.S. to 'SD.' Under our rating definitions, 'SD,' or selective default, refers to a situation where an issuer, the federal government in this case, has defaulted on some of its debt obligations, while remaining current on its other debt obligations.

-- We may also lower the long-term rating and affirm the short-term rating if we conclude that future adjustments to the debt ceiling are likely to be the subject of political maneuvering to the extent that questions persist about Congress' and the Administration's willingness and ability to timely honor the U.S.' scheduled debt obligations.

http://www.reuters.com/article/2011/07/14/market-ratings-creditwatch-us-idUSWNA372820110714

2011-07-10T15:36:00.000-07:00

Went to see the CLICKS “Urban Landscape” photo exhibit at the Cotton Mill late this afternoon…some of the work showing was pretty impressive…but I was real impressed with how they hung it…

Iphone 4

2011-07-08T16:17:00.000-07:00

McKinney Fire and EMS...

2011-07-07T15:16:00.000-07:00

Tax increases or massive defense cuts?
Rick Moran

That appears to be the choice the Democrats are giving the Republicans in the debt talks.

The Hill:

National security spending could be cut by as much as $700 billion in a deal to raise the debt limit, defense sources said.

That's almost twice the amount President Obama originally proposed.

Obama directed the Defense Department and other national-security agencies to slash $400 billion by 2023. But in the closed-door talks to raise the debt ceiling, larger Pentagon funding cuts have been seriously discussed, several sources said, putting the number between $600 billion and $700 billion over a decade.

A final decision has yet to be made, but the sources said negotiators have not ruled out making deeper cuts than Obama planned.

As the Aug. 2 deadline for defaulting on the debt approaches, GOP members have dug in and said any accord cannot include tax hikes.

Sources told The Hill recently that GOP negotiators are ready to break with recent Republican ideology by trading large defense cuts for not raising taxes as part of a debt-ceiling deal.

What is extremely disturbing about this is that both parties are approaching cuts in defense the same way they might cut funding to national parks, or transportation. You don't pick a number out of the blue and say we're going to cut $700 billion from defense. The first thing you do is determine what our defense needs are and then find savings that can be made without affecting our ability to defend ourselves or our interests.

New defense secretary Leon Panetta is a good Obama soldier (that's why he's there) and probably won't protest too much. And the military will grumble, but tradition and honor preclude them from openly criticizing the politicians.

The fall off in our effectiveness to battle terrorists and confront the thugs of the world will be a choice, not an inevitable decline.

http://www.americanthinker.com/print...ense_cuts.html

2011-07-04T19:43:00.000-07:00

As the flag passed people stood up and clapped!...

2011-07-04T11:06:00.000-07:00

"That to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed. That whenever any form of government becomes destructive to these ends, it is the right of the people to alter or to abolish it, and to institute new government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their safety and happiness."

Happy 4th of July everyone!

2011-07-01T12:50:00.000-07:00

Somebody got some rain last night, but wasn't here!

2011-07-01T12:43:00.001-07:00

Minnesota Government Shuts Down as Budget Talks Fail

Minnesota Government Shuts Down as Budget Talks Fail

Published July 01, 2011 | Associated Press

Minnesota stumbled into its second government shutdown in six years on Thursday, with a partisan divide over taxes and spending to close a $5 billion deficit becoming only more bitter as a midnight deadline came and went without agreement.

Any hope of a last-minute budget deal between Democratic Gov. Mark Dayton and Republican legislative leaders evaporated around 10 p.m., when Dayton appeared to say he and Republicans were still fundamentally divided over how much the state should spend the next two years and that he saw no chance of avoiding a shutdown.

"It's significant that this shutdown will begin on the Fourth of July weekend," Dayton said. "On that date we celebrate our independence. It also reminds us there are causes and struggles worth fighting for."

Republicans appeared again minutes later, and tried to hang blame for the shutdown around the governor's neck. They said the two sides were closer than he admitted, and they criticized his refusal to call a special session so lawmakers could pass a "lights on" budget bill to keep government running. Dayton refused, saying he's been clear for months that he would only agree to a total budget approach.

"I think the governor's insistence that we pass a full budget is not going to be of much comfort to Minnesotans who are going to see delays on the highways because construction projects stop," said Senate Majority Leader Amy Koch, R-Buffalo. "It's not going to comfort people who can't use our state parks, or who can't get a driver's license."

The two sides didn't meet again ahead of the deadline.

The shutdown means thousands of layoffs, a standstill for road projects and padlocked state parks just ahead of the Fourth of July weekend. The effects were already being felt hours ahead of the deadline, as people rushed Thursday to get driver's and fishing licenses, and park officials began warning campers to pack their gear and leave.

Though nearly all states are having severe budget problems this year, Minnesota was alone in its futility, thanks to Dayton's determination to raise taxes on high-earners to close a $5 billion deficit and the Republican Legislature's insistance that the gap should be closed by cutting spending.

Negotiations between Dayton and legislative leaders were fitful Thursday, starting and stopping with no outward signs of progress. After talks broke down for the last time, Dayton and GOP leaders gave conflicting accounts of the last few rounds of offers.

Republican Sen. Michelle Benson said earlier in the day she wasn't budging, a position that Republican leaders held to even after it became clear the shutdown was coming.

"If we don't start taking a different approach to how we manage our government, we're going to swing from one bad economic circumstance to another," Benson said. "We can't just keep throwing more money at government and hoping that makes things better."

The showdown was something of a small-stage version of the drama taking shape in Washington between President Barack Obama and the Republicans over taxes and the nation's debt ceiling.

Though many states are having budget difficulties this year, those where political power is concentrated in a single party easily passed budgets.

Some of those with divided government had healthy reserves, including Alaska, Iowa and Montana; Minnesota's rainy-day accounts are drained.

Others such as Louisiana and Nevada used one-time money or federal dollars to patch things together. Nevada and Missouri renewed taxes.

In New Jersey, Republican Gov. Chris Christie used the line-item veto Thursday to pare a budget from the Democratic-controlled Legislature before signing it into law, preventing a shutdown.

Only four other states -- Michigan, New Jersey, Pennsylvania and Tennessee -- have had shutdowns in the past decade, some lasting mere hours.

Minnesota's last shutdown, in 2005, lasted just eight days and was far smaller than this stoppage because lawmakers had agreed on several pieces of the budget.

Minnesota's stoppage halted non-emergency road construction, shut the state zoo and Capitol, and stopped child-care assistance for the poor.

More than 40 state boards and agencies would go dark. Critical services, including the State Patrol, prisons, disaster response and federally funded health, welfare and food stamp programs, will continue.

State park officials told campers to strike their tents well before the deadline. They said it would be too difficult to herd campers out in the middle of the night if talks failed.

In Afton State Park, near St. Paul, Rick Miller of Elko-New Market pushed up a camping trip with his 7-year-old son, Jack, to beat the shutdown. Miller originally hoped they could spend Thursday and Friday nights in the park on the picturesque St. Croix River, but he booked a campsite for Wednesday night.

"With the shutdown we decided we better come and get it in," he said. "We don't know how long it will be before we can get back into a state park." He added: "It's too bad they can't just get the job done."

A small group of protesters paraded before reporters clustered outside Dayton's office on Thursday afternoon, chanting and waving signs to support the governor's position. "You say cut back, we say fight back!" they yelled. One woman carried a handmade sign that read: "GOV DAYTON DON'T BACK DOWN!"

Dayton is Minnesota's first Democratic governor in 20 years, and Republicans are running the entire Legislature for the first time in 38 years.

Dayton has proposed raising taxes on couples earning more than $300,000 and individuals making more than $180,000. Republicans have opposed any new taxes or new revenue sources, arguing instead that the state should rely on spending cuts, including deeper reductions in health and welfare spending than Dayton is willing to accept.

Some GOP moderates have talked of breaking the impasse with other means of raising revenue, such as eliminating tax breaks or authorizing a casino. Dayton has said he is open to such ideas.

Rank-and-file Republicans gathered at the Capitol on Thursday, more than a month after their regular session ended. Members of the large Republican freshman class, whose election victories in November helped the party take control of the Legislature for the first time in decades, held tight to their message that a total two-year state budget of $34 billion is big enough.

"I personally think the Republicans will probably be more damaged than the governor" by a shutdown, said freshman Rep. Mike LeMieur, R-Little Falls, who toppled an incumbent Democrat in November. "The fact is that we're all up for re-election again next year, and he's not up for three years."
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http://www.foxnews.com/politics/2011...into-shutdown/

2011-06-30T08:35:00.000-07:00

In Cowtown for the day...

Iphone 4...

2011-06-27T08:39:00.001-07:00

Suspended Agitation

By James Howard Kunstler
on June 27, 2011 9:35 AM

Woe is unto the world. It doesn't know whether to shit or go blind. The rule of law has been replaced by Murphy's Law. The story in Greece gets more and more curious. One of the latest proposals is to ask holders of Greek bonds to go along with a voluntary rollover, meaning we will pay you on Tuesday for a hamburger today, even though we already owe you for ten years of weekly hamburgers.

Odd how the financial innovation never ceases. This last great new idea: that bonds never really have to pay off, will do wonders for the bond market everywhere. People will clamor for bonds that come with no clear terms and probably no redemptions. Now, the buzz around the cosmic meme-sphere is saying fuggedabowt Greece, we're gonna do the same thing with Portugal and its sillyass bonds. Enter China.

Europe is about to enjoy the greatest monetary Chinese fire drill ever staged. Wen Jiabao will wave a magic wand and the Euro will fly above mundane reality on dragon wings allowing everybody in Greece, Portugal, Spain, Ireland, and Italy to hold a senior management job at the motor vehicle bureau with retirement at 53. Then, with 80 percent of their former pay, they can open cafes where people still working at the motor vehicle bureau can spend the better part of each afternoon sipping Ouzo and arguing politics, finance, sports... or just enjoying the antics of the boorish German tourists.

Meanwhile, Goldman Sachs's man in Europe, Mario Draghi, will take a seat in Jean Trichet's big chair at the European Central Bank around November of this year. It was Goldman Sachs, apparently, that erected a giant credit default swap house of cards for Europe to live in happily-ever-after - except in the event of a default accident, in which case Goldman Sachs would receive all the money ever printed on God's green Earth, plus commissions, premiums, penalty payouts, interest, and bonuses... and homeless Europe would then be welcome to take a flying fuck at a rolling donut - or make that a strawberry Bismarck! Personally, I don't see how the various players can delay some sort of crisis until November. The European currency experiment is a bust and too many big banks are just plain insolvent. Can Wen Jiabao launch another flying dragon that seeds the European skies with counterparty payoffs that will rain down from Dublin to Athens and keep everybody happy?

Don't get the idea that the USA can just occupy a grandstand seat and stuff its fat face with Cheez Doodles while the current act plays out in the center ring of the world financial circus. Plenty of intermingled American interests depend on how things work out over there, not the least of which is the fact that the International Monetary Fund is actually a proxy American bail-out operation. It worked just fine in the old days when its exertions focused on little urchin nations like Swaziland, but wait until the Tea Party hears that America runs twelve thousand cafes for European motor vehicle bureaucrats to while away the afternoons drinking Ouzo in. (At least maybe we can get them to drink Old Mr. Boston anisette liqueur instead.)

It does prompt one to think we might try something like that here. Would it not improve the national character generally if our citizens spent more time arguing politics in cafes than lying on the couch watching a TV figment named "Snooki" throw standing crotch-locks on every unemployed forklift driver in the mythical kingdom of New Jersey?

If I were Barack Obama, I'd think twice about presiding over this irresolvable muddle of engineered swindles, sinking prospects, booby-trapped budgets, and played-out lies for another term. Let Hillary step in and try to keep this leaky Flying Dutchman out of the drink. She's looking more and more like Winston Churchill physically every day now, anyway. Maybe she is acquiring something like his stolid habits of mind, too. If I were President Obama, I'd just call it quits and sign on with the home team: Goldman Sachs. He can have Mario Draghi's old job - chief of the international division. They'll love him in all those peculiar little countries where people wear hats that look like rat-traps and flavor their beer with the cocoons of nectar-sipping moths. They'll enjoy it when he forecloses on them, and maybe even ask for more. "Here, take our grandchildren's baby teeth, too!" I wish him and his beautiful family well in their new life as distinguished private citizens-of-the-world. I just hope Michele Bachmann and her probable running mate, Jesus, don't steal the next election. They'll rip out the Obamas' vegetable garden and put a Nascar track there so that all of Ms. Bachmann's 27 children can have jobs selling miniature bibles in the parking lot. ("Prayed over by qualified preachers twenty-four hours a day!")

By the by, many observers were amused by last week's cute trick of releasing sixty million barrels of oil from the world's strategic reserves at the rate of two million-a-day in an effort to pretend that the world doesn't have a basic oil production problem. It is, of course, at the bottom of the world's financial disarray, because if you can't increase energy inputs that feed an industrial economy you don't get growth and then the whole idea of compound interest falls apart because it is predicated on a perpetual increase in wealth. Hence, debt collapses in on itself. The world is caught up in an epochal contraction now, and it manifests in situations like the Greek emergency. But soon it will be a universal emergency.

The lesson, if I may be tendentious for moment, is that the human race is welcome at any time to begin living differently, at a smaller scale, much more locally, with fewer automatic machines doing all the work for us, and more time spent on useful and necessary activities than on television fantasies. Got a problem with oil? Don't imagine that you're going to run WalMart - or, for that matter, Goldman Sachs - on wheat-straw distillates. Something is in the air this week and it is making a lot of people very nervous. If you loaded up the old investment portfolio with shale gas stocks, I feel especially sorry for you.

http://kunstler.com/blog/2011/06/suspended-agitation.html

2011-06-20T16:59:00.000-07:00

Storms this late in June are pretty rare but maybe we'll get lucky for a couple of days...would be even better if it cooled things down for a couple of days...

Iphone 4

2011-06-20T09:03:00.000-07:00

Up in Whitewright...

2011-06-20T08:45:00.000-07:00

Man Down

By James Howard Kunstler
on June 20, 2011 9:30 AM

Last week, in an incident that didn't get much attention in the national news, a man named Tom Ball set himself on fire in front of the county courthouse in Keene, NH. He left a fifteen-page suicide note explaining his actions. He was angry at the state child protection bureaucracy and the courts after a ten-year battle over a child abuse charge that became, for him, a Kafkaesque struggle with cruel authority. The long suicide note he left was a thoughtful and disturbing indictment of the legal procedures now common across America that have had many unanticipated consequences - from breaking up families to homelessness - but it was also a grim comment on the condition of American manhood.

A casual Martian observer hanging around any convenience store in the "fly-over" zones of this nation must be impressed with the striking way that American men present themselves to the world. Forgive me for revisiting an oft-dredged-up theme - male costuming and adornment in our time - but I wouldn't keep bringing it up if I didn't think it was significant. On the whole, American men present themselves as savages. I think they do it because they feel very insecure about themselves - similar to the insecurity that prompts a politician to wear a flag lapel pin. Should there be any doubt that an elected official cares about his country? Or maybe we should ask: what kind of country produces such craven, weak, pandering elected officials? What kind of culture produces men who get themselves up like chain-saw murderers?

The same country that furnishes an endless diet of super-hero movies to pubescent males who are not expected to develop normal adult coping powers. The same country that supplies gruesome, sado-masochistic video games to occupy the idle hours of young men - and then lets them take those "skills" to some tilt-up bunker in Nevada where they sit in air-conditioned comfort and direct drone aircraft ten thousand miles away to incinerate suspected "enemies" in mud villages. (Sometimes "mistakes are made" and they blow up a wedding party or something - but the drone controllers still get to leave the bunker at the end of their shift and roll down the strip for a plastic tray full of burritos.)

This month's WeinerGate was another instructive incident. Up-and-coming wonderboy politician revealed to be secret sex schlemiel, undone by "social media" - which turns out to have the unanticipated consequence of undermining the impulse control of supposedly grown men. Who knew? But what interested me more than Weiner's pitiful dishonesty was the parade of women journalists on cable TV news who all agreed that poor Weiner's downfall was yet another conclusive demonstration of how hopeless men are - not to mention that their male colleagues on-screen, Blitzer, King, O'Donnell, sheepishly agreed with them. This ceremonial posturing for moral brownie points in an extremely moralistic and puritanical culture does tend to obscure the reality that adult male humans are sexually alert in an inconvenient way that is not identical to the experience of females. Notwithstanding the evident insanity of Dominque Strauss-Kahn jumping the hotel maid, men sometimes make passes. American women cannot forgive them for this. Lesson: perhaps American men should not make such an effort to seek forgiveness. I am waiting, personally, for some Mark Sanford type (former South Carolina governor caught in "affair" with Argentine firecracker) to go before the microphones and say to media (and the voters), "this is none of your goddam business."

Which brings me to the troublesome subject of gay marriage, which is lately up for debate in the legislature of New York State where I live, making it the public's business. I have an unpopular view of it for men of my demographic (Democrat, Boomer). I'm not in favor of it. I don't think it is a good idea. I don't have empirical proof, but I suspect that unsettling such an age-old and fundamental social arrangement will produce strange unanticipated consequences that we are not prepared for. I don't believe gay marriage is a genuine social justice issue. I think it is a bid for a kind of broad social approbation which does not require ritual enactment in law, and would be socially mischievous to pursue. Civil unions would cover the necessary legal issues. Otherwise, it is a case of unwarranted relativism, a Boomer weakness. Not all conditions or states of being in this world are the same. Some things are on the margins because they are marginal.

What fascinates me in the debate is the narcissism of Boomers, males especially, who advocate so earnestly in favor of gay marriage. Is it really about the law and social relations, or is it about making yourself feel good? Is it just more posturing for moral brownie points, for approval? Is your job and social position or maybe even sense of yourself at stake if you have a differing view?

I had an interesting experience with my last two books (World Made By Hand and The Witch of Hebron), which were set in a post-oil, post economic collapse American future and depicted daily life in a way that was quite unlike the way we live right now. I received a heap of criticism from female readers - including peak oil activists - full of consternation that I did not present female characters in the kinds of dominant valorized roles that are favored today: the post-oil equivalent of CEO, news anchor, CIA-Ninja warrior, Presidential candidate. What struck me was their complete failure of imagination. They could not conceive of male / female relations that were different than today's, even in a world that had been turned economically upside down.

However, this was not inconsistent with the failure of American men to know how to act like men in this anxious moment of history. The choices are pretty unappetizing: be a jobless loser in a "Pray for Death" T-shirt with neck and knuckle tattoos, or a loser in a corporate cubicle, or a loser in that Nevada drone-control bunker, or a loser in the eyes of the family court, or a loser on cable TV. Tom Ball, the man who set himself on fire in Keene, New Hampshire recommended something that sounded a lot like violent revolution, though his tone was eerily measured for someone about to commit the most desperate personally public act. I hope we don't have to go through a convulsion in this land to find out how what it means to be a man.

http://kunstler.com/blog/2011/06/man-down.html

2011-06-19T10:42:00.000-07:00

I'm sure by now that everyone has heard about the "Kissing Couple" during the riots in Canada last week...if not here is the info..

http://www.cbc.ca/news/canada/british-columbia/story/2011/06/17/vancouver-kissing-couple.html

2011-06-16T11:29:00.000-07:00

FRANKFURT, Germany (AP) -- Greece's economy is small but the shock waves from a default on its debt could be amplified by links in the global financial system to hurt stocks, banks and entire economies far from the epicenter in Athens.

In Greece, banks could go bust, overwhelming the government's ability to bail them out, and lenders in France, Germany and elsewhere in Europe could suffer serious losses.

And the resulting market turmoil could strain the European' Union's backstop fund, pushing European leaders to drum up yet more taxpayer financing, with voters already annoyed at funding other people's failed governments.

The exact effects of a Greek debt implosion are hard to anticipate, in part because no one knows how big the losses would be for bond holders, who stand first in the chain of dominoes. Forced losses of 50 percent would be one thing, a voluntary stretchout of repayment another.

Beyond the immediate hit to banks, the biggest fear is that of contagion -- a difficult-to-predict chain reaction that could roil markets and make it harder for other indebted countries to cope with their debts, with the result being higher borrowing costs for eurozone countries.

Some even say the end of that road could be one or more of the weakest euro members -- such as Greece -- leaving the shared currency, though the political will to prevent that remains strong.

Some are comparing a Greek default to the collapse of U.S. investment bank Lehman Brothers in September, 2008, which triggered the most severe phase of the world financial crisis, freezing credit markets and leading to a slump in global trade.

It's not clear a Greek default would be that sweeping, but economists say that like Lehman's collapse, its damage could be greater than expected.

"The risk of a 'Lehman moment' for the eurozone is increasing," says Neil MacKinnon, analyst at VTB Capital. "The nature of the eurozone debt and banking crisis is similar to previous financial crises in modern times because of the inter-connectedness between the banking sectors and government debt."

Financial trouble can hit the wider economy if banks suffer losses that make them afraid or unable to lend to businesses. The IMF has identified bank trouble as the biggest risk to Europe's recovery.

"It's difficult to separate out the financial risks from the macroeconomic risks," said Jonathan Loynes, chief European economist at Capital Economics. "The two are clearly very closely related."

"If there are major systemic financial repercussions, from some sort of Greek default then I think it would pretty clear that they would have major macroeconomic effect. We saw that after the Lehman episode... Disruption in financial markets is very readily translated to macroeconomic weakness through a number of channels."

Markets would then wonder whether bailed-out Ireland and Portugal would also default, making it harder for them to return to borrowing markets.

For now, most observers and market participants expect some kind of new aid deal to tide Greece over short-term -- but fears that the EU might fail at that task is sending stock markets and the euro lower, after Greece's government called a confidence vote over its struggle to impose more spending cuts on its unhappy constituents. That follows eurozone finance officials' inability to agree on conditions for a new aid package.

French and German banks hold 55 percent of Europe's total exposure to Greece, with $56.7 billion and $33.9 billion. That includes money owed by government and banks, plus exposure to credit guarantees.

Ratings agencies have indicated that banks could probably get through losses of 50 percent or more on their holdings, based on their profitability, though shareholders would see their earnings dinged.

Greek banks, which hold roughly a third of the country's debt, could see their capital wiped out and need bailouts.

For just this reason, the European Central Bank has warned against letting Greece force bondholders to take less than full payment: any money the Athens government saved would just have to be used to recapitalize the Greek banks.

With the government already bankrupt, the money would likely have to come from somewhere else -- such as fellow eurozone governments who have already kicked in for bailouts and are now facing a sour mood among their voters for having done so. Mario Draghi, head of Italy's central bank and the likely next head of the European Central Bank, warned the European parliament Tuesday that anyone advocating a restructuring needed to be ready with new money.

"The cost of a real default will exceed the benefits and will not address the root causes. Moreover we do not know what contagion effects it will have", said Mr Draghi.

Nout Wellink, another member of the ECB's rate-setting council, said European governments need to be ready to double the size of their bailout fund to euro1.5 billion -- a prospect that cannot please German Chancellor Angela Merkel, who faces unrest in her government's ranks over Germany's role as the leading funder of bailouts.

Economist Loynes said even a relatively orderly default would not end the crisis. That's because Greece's economy still has business costs that make it uncompetitive in international trade.

"I don't think it stops with a default, either. I think this is all leading down a road which ends with Greece and perhaps some of the other countries deciding to leave the single currency."

http://finance.yahoo.com/news/Greek-default-could-trigger-apf-169793849.html?x=0&sec=topStories&pos=main&asset=&ccode=

2011-06-14T08:36:00.000-07:00

from a walk thru town...alleyway...

2011-06-13T10:35:00.000-07:00

A Distant Sound of Churning

By James Howard Kunstler
on June 13, 2011 9:03 AM

In my last dream of a febrile night, I put my flat-screen TV on top of an old house in town and watched it crash onto the street. There was nothing inside it. The darn thing was empty. The ghost of Little Caylee wasn't even in there.

From the news this weekend, you'd think the world was in a coma, but I swear I heard ominous bassoon phrases through the night rain... something large groaning out there in the dark. A great churn, coming closer. The world is in a box, tortured with its obsolete ideas about how economies are supposed to run, especially the money part, and the economists are clueless.

A case in point: the eminent Vincent Reinhart at the Council of Foreign Relations last week. (Conspiracy theorists just shut your pie-holes):

"There are very few debt defaults... there are a whole lot of restructurings. For most of history, default is something the strong declare on the weak when they lose their patience. And if you're members of the same club, you're less likely to lose your patience. Hence you're less likely to default. Greece is in the club."

The club he refers to - the Euro money club - is less a jolly fraternal lodge than a funeral insurance association. The latest restructuring for Greece he referred to is a cockamamie perpetual rollover with no redemptions allowed, while Greece has to agree to become more like its neighbor, Albania, in lifestyle - that is, like Borat, minus the joie de vivre.

There's a third option that Reinhart ignores: the Greek populace can riot in the streets, toss out their government, install some kind of rump leadership and hoist its middle fingers at the Euro management team, opting out of the club. Why this does not occur to Reinhart (and many other vested poobahs) I can't say, despite the fact that there are many places around the world (especially Europe these days) where the natives are obviously getting restless. Besides, it's not lost on the Greek people that they're being asked to go Albanian for the sake of a dozen banks up in Germany, France, and Holland, not their own country's sacred honor.

The proposed restructuring is all about the Great Fear that haunts the inner sanctums of finance (like the ghost of Caylee haunts America): counter-party obligations on a Burj Dubai of side bets over things such as the soundness of bonds and the movement of interest rates. The world of money imagines a thundering crash of cascading defaults as the various counter-parties are revealed to be broke, naked, and ashamed. And rightly so, because the creakings and groanings of this tower of paper will not only crash, but burn, too. The bankers can already smell it.

Anyway, let's be clear that money has become a world unto itself now, a self-referential hall-of-mirrors that only sees itself and is increasingly confused by what it sees in that self. Outside that blinding little box there are real economies of people trying like hell to go about their daily life, and there is much to be fretful about. Economies are caught in the permanent compressive contraction of fossil fuel based activities. When you hear a politician utter the word "growth" note that he/she is speaking out of his/her ass. Contraction is contraction, not growth. We're done with growth of that kind because our fuel supplies are shrinking, not growing. The vaunted "recovery" is a political three-card-monte trick.

The sad fact is we don't want to go where history wants to take us: to a smaller human imprint on the planet, with all that implies. This is true especially of the intellectual avant-garde, who can't imagine a world without the joys of perpetual techno-narcissistic novelty, of levitating skyscraper cities with hanging gardens and flying cars, full of girls with green nail-polish in get-ups so fantastic mere mortals could never have dreamed them up, flaunting hand-held gadgets so miraculous that life itself seems besides the point. Oh, shimmering future! Oh Ray Kurzweil and your nano-ladder to the worm-holes of forever!

This Ancien Régime is about to be swept away on the tsunami of its own futility.

The failure of leadership around the world is now complete. Nobody who needs to get it gets it. Our own money management team here in the USA is in a box even worse than Europe's. It's not even a hall of mirrors. It's a broke-down Winnebago with moldy upholstery and the propane line is leaking inside. Everybody's wondering if Ben Bernanke is going to light a cigarette. What else can he do? If he doesn't keep the QE-ZIRP racket going, the wheels will come off the Winnebago. If he lights that American Spirit, she'll blow.

The US banking system can easily implode, anyway, if a European nation or two opts out of ECB-peristroika. God knows who is a counter-party to whom in the mammoth international clusterfuck of accounting fraud that passes for a commerce in capital. Hence, everybody is nervous - except the fools at the Nascar oval with Big Gulps in their fists. When the Greeks and Spain's youth corps, and even the bleery folk of Dublin take to the central square to express their rage, and hoist middle fingers to those who would chisel them into debt serfdom, Americans will have no central squares to go to. Will we take to the highway strips and burn down a Taco Bell or two? Maybe President Obama will ask congress for a home mortgage TARP, guaranteeing that nobody will ever buy a house again, at least not on an installment loan. Maybe in tonight's New Hampshire "debate," Michele Bachman will appeal to Jesus for the release of Little Caylee from eternity's impoundment lot, and the stunt will carry her overwhelmingly to the oval office.

By then, America, too, will be more like Albania. You can take that to the bank, if there's one left standing. Yesterday a little US flag appeared on every mailbox in the neighborhood. Someone is trying to help remind us what country this is. Most years, this is just ceremonial routine, but now I suspect a lot of people get up and scratch their heads over it. And, believe me, just waving that old flag is not going to furnish any kind of idea you can really hang onto.

Out of the current stillness in world events, a horrible churning waits. Men in impeccable suits on Swiss terraces cannot hide their anxiety. One might even lose it and jump a hotel maid - you never know. Bernanke, Obama, Geithner are powerless against the dark lurking churn, though they can easily make it worse. What a summer we're in for. Get out of the stock market.

http://kunstler.com/blog/2011/06/a-distant-sound-of-churning-1.html

2011-06-11T22:13:00.000-07:00

Ice Cream Crank-off at Chestnut Square...

lots of folks turned out for a break in the heat and to eat some good homemade ice cream!

2011-06-11T22:09:00.000-07:00

This morning I discovered the joys of Iphone photography, proving once again

that the best camera is the one you have with you...

Farmers Market @ Chestnut Square

2011-06-10T10:46:00.000-07:00

More on Fukushima...truth or fiction???

Fukushima meltdown – Caldicott says Japan may become uninhabitable – media silent

http://www.independentaustralia.net/...-media-silent/

Posted On Tuesday, 31 May 2011

Dr Helen Caldicott says that the Fukushima nuclear disaster has the potential to make Japan “uninhabitable”, yet the mainstream media in Australia continue to ignore the crisis. Managing editor David Donovan reports.

Yesterday – the same day Germany announced it would close all its nuclear plants because of Fukushima, and dangerous levels of radiation were reported in Japanese clean-up workers – Independent Australia did a straw poll of 50 random people at a metropolitan shopping centre in Queensland. Each of them was asked: “were you aware that there had been a nuclear meltdown at Fukushima in Japan”. Almost all of these respondents recognised the name Fukushima but only 4 of the 50 – a mere 8 per cent – said they had heard of any meltdown.

This rough poll points to deficiencies in popular media reporting in Australia of what some say has the potential to become the most devastating man-made disaster the world has ever known.

That may sound like an alarming claim, so let’s look at the facts.

THE CATACLYSM
In the wake of the March earthquake and tsunami, on March 15, Independent Australia reported:
“Yesterday, Japan’s nuclear agency attempted to calm fears by ranking the incident as a Category 4 nuclear accident, below the 1979 Three Mile Island partial meltdown in the US and well below the Chernobyl meltdown and explosion 25 years ago which rated top of the scale at seven.”

As also reported then, experts in Australia, including Dr Ziggy Switkowski, along with the Japanese nuclear power plant operator Tepco, tried hard then to dispel public fears about the severity of the disaster. By March 25, however, the category had been upgraded above Three Mile Island to a level 6. Then on April 13, as Tepco struggled to contain the fires burning at the reactor, it was reluctantly given the top rating of 7 by the Japanese authorities, which classed it as a “major accident”, equal to Chernobyl though officials still maintained the disaster was not as severe since there had not, apparently, been a melt-down.

Fast forward a month to May 13, and people’s suspicions and fears were realised when Tepco admitted there had, in fact, been a meltdown in Reactor One. Not only that, but reports began circulating that Tepco had been aware of the meltdown since the very earliest days of the accident.

On May 18, the Financial Times reported the following about the escalating situation:
“In the first days after the Fukushima Daiichi nuclear power station began spewing radiation in mid-March, the plant’s operator and Japanese safety regulators studiously avoided the word “meltdown”.

Yes, they said, uranium fuel rods in the tsunami-hit facility’s reactors might have been damaged after cooling systems failed. But the official view was that the rods were still mostly intact – and radioactive material was safely contained inside their zirconium sheaths.

Now, a little over two months later, new information on the state of Fukushima Daiichi’s three overheated reactors is making the m-word impossible to avoid. Fuel inside the cores, it is now understood, melted far more quickly and extensively than was initially believed – disintegrating just a few hours after the tsunami knocked out the plants electricity and cooling systems.”

And, not only had there been a meltdown in reactor 1 but, in fact, there had been meltdowns in two other reactors as well:
Tokyo Electric Power, Fukushima’s operator, says there may be little left of the rods at all – just clumps of uranium at the bottom of the reactors’ innermost steel containers. Some of the melted fuel may have leaked into the concrete vessels that form the next layer of protective containment, making for a meltdown by even the narrowest industry standards.

On Wednesday Naoto Kan, prime minister, said Tepco was working on the assumption that some fuel from Fukushima Daiichi’s No 1 reactor core had leaked out. On Monday Haruki Madarame, chairman of the Nuclear Safety Commission, said: “Our understanding is that the No 2 reactor melted down. We surmise that the No 3 reactor is in the same situation.” The darkening picture of conditions inside the cores – which has emerged since Tepco began sending workers into the reactor buildings for the first time last week – has added to doubts about whether Tepco and the government disclosed all they knew in the early days of the crisis.

The Financial Times went on to say that the Japanese Government was maintaining its line that Fukushima had only leaked 10 per cent of the radiation of Chernobyl.

This claim must now be held in grave doubt. Former nuclear industry engineer and executive Arnie Gunderson described the ground water contamination at Fukushima as “the worst in human history”. Dr Vivian Norris, writing in the Huffington Post, described his findings:
Gundersen is in touch with senior members of the Japanese nuclear establishment.…I will summarize some of Gunderson’s very disturbing and important information here:

1. There was a hydrogen explosion and it was a detonation not a deflagration, in other words the fire burned up not burned down.
2. A frame by frame analysis shows a flame which confirms that the fuel pool is burning as a result of an explosion which started as a hydrogen explosion but that could not have lifted the fuel into the air so there must have been a violent explosion at the bottom of the fuel pool. But more data is needed.
3. Gunderson speaks about past criticalities in other nuclear reactors around the world, and I fin d it odd we are not hearing about these and how they can teach us about what is going on now at Fukushima.
4. Radioactive water is being pumped out and ground water is contaminated so there must be a leak or leaks and this disaster is in no way contained. There will be contamination for a long time to come and this ground water contamination is moving inland. One town is reporting radioactive sewage sludge from ground water or rainwater.
5. The Greenpeace ship Rainbow water has requested the Japanese government to test the waters near Japan and Japan has refused this independent data request. The EPA has also shut down all inspection centers and is NOT inspecting fish. (Why the silence?)

Professor Christopher Busby from the European Committee on Radiation Risks says Fukushima’s highly radioactive gases and liquids continue to be released into the environment unabated. Prof. Busby noted that higher than normal levels of radioactivity had, along with Tokyo, been reported in the US as well in Europe and the UK. He suggested that we are likely to see at least 400,000 cases of cancer as a result of Fukushima.

“It is a global situation now,” said Prof. Busby, “and the situation continues to worsen.”

“Of course it’s time for the Japanese government to take control. But having said that, it’s very hard to know how you could take control of the situation. The situation is essentially out of control.”

CALDICOTT: JAPAN MAY BECOME UNINHABITABLE FOREVER

So far the plume of radioactivity from Fukushima has mainly been blowing out to sea. The concern expressed by many is about what happens if the prevailing winds turn around, as they are expected to do, and begin to blow southwards towards Tokyo.

Dr Vivian Norris, quoting Arnie Gunderson again:
What is highly disturbing is that the main reason Japan does not appear to be as bad a Chernobyl is that the wind was blowing out to sea and not for the most part towards land. But all this has done is spread the cancers out into the worldwide population as opposed to concentrating it all in Japan. It will be very difficult to tell, as it was in France, Scandinavia and other places where the Chernobyl cloud travelled in the days following the disaster.

Speaking exclusively to Independent Australia, prominent anti-nuclear campaigner Dr Helen Caldicott raised two grim and shocking scenarios about what foreseeably could happen next in this developing emergency.

“If there is a very big aftershock, as there very well could be, Reactor 4 will probably collapse along with other buildings. This would create a Chernobyl type catastrophe which, combined with a change in the wind – so its blowing the radiation to the South instead of out to sea as it is at the moment – could make almost all of Japan – including Tokyo –uninhabitable forever.”

“The second possible scenario is that there could be hydrogen explosion blowing one of the reactors apart also creating a Chernobyl type event. This, combined with the wind change mentioned would create the same result—an uninhabitable Japan.”

MEDIA SILENCE
Fukushima may end up being one of the worst disaster the world has seen, we are yet to know its full impact as Japanese authorities struggle to contain the fallout. Yet, if you weren’t reading Independent Australia, listening closely to a small handful of other Australian media sources, such as Crikey, or Mark Willacy on ABC radio, or reading the international press, it is likely that you would have missed the meltdown and would have no comprehension about the full scale of the disaster. In other words, the vast majority of Australians who get their news from newspapers or commercial television or radio have no idea about the severity of the Fukushima nuclear disaster, or the danger to human health posed by this ongoing crisis.

Something similar is going on in Japan and the US. In Japan, the nuclear industry has been actively promoted by the Government since inception in the interests of Japanese nuclear security. The nuclear regulator is almost entirely made up for former Tepco employees and is described as being almost an arm of the power company. Criticism of nuclear power has long been strongly suppressed in Japan.

[Japanese journalist] Uesugi also notes that at TEPCO press conferences, which are now being held at company headquarters, foreign correspondents and Japanese freelancers regularly ask probing questions while mainstream journalists simply record and report company statements reiterating that the situation is basically under control and there is nothing to worry about. One reason for this, Uesugi suggests, is that TEPCO, a giant media sponsor, has an annual 20 billion yen advertising budget. “The media keeps defending the information from TEPCO!” “The Japanese media today is no different from the wartime propaganda media that kept repeating to the very end that ‘Japan is winning the war against America,’” Uesugi exclaimed.

Clearly, there is a concerted effort by Japanese authorities to downplay the significance of the disaster to ensure the future sustainability of the nuclear power industry. But what about the similar silence in the US?

Dr Norris says the issue should be front page news everywhere:
“Why is this not on the front page of every single newspaper in the world? Why are official agencies not measuring from many places around the world and reporting on what is going on in terms of contamination every single day since this disaster happened? Radioactivity has been being released now for almost two full months! Even small amounts when released continuously, and in fact especially continuous exposure to small amounts of radioactivity, can cause all kinds of increases in cancers.”

In the US and Japan, where the nuclear industry is a powerful lobby group, perhaps it is understandable that the nuclear industry have managed to suppress information about this devastating crisis. But here in Australia, where we have no nuclear power industry? The reality is that Australia, with its huge natural reserves of uranium and strong mining industry, is deeply entrenched in the nuclear cabal. Independent Australia has reported before about plans for the world’s nuclear waste to be shipped to Australia and the fact this agreement with the US was actively suppressed by the Australian media, perhaps because some media proprietors have strong vested interests in the nuclear industry. It seems that Australia’s overly concentrated media industry is not only a crisis for our democracy, but can potentially even threaten our children’s health.

Dr Caldicott said that the media here are failing in their duty to the people of Australia.

“The media need to be brought down to Earth,” said Dr Caldicott.

“President Jefferson said an informed democracy will make reasonable decisions.”

“The media are failing to inform, so the people can’t make reasonable decisions.”

2011-06-06T09:35:00.000-07:00

Fitch Blows At Greek Bailout House Of Cards, Says On Closing Of Distressed Debt Exchange Will Place Sovereign Rating Into Default

Submitted by Tyler Durden on 06/06/2011 10:32 -0400

As we speculated yesterday...

If in Fitch's opinion, an announced exchange offer constitutes a DDE, the sovereign issuer rating will be lowered to 'C', indicating that default is highly likely in the near term

Fitch will place the issuer rating of the sovereign into default, specifically 'Restricted Default' (RD) upon closing of a distrssed debt exchange.

Fitch says a potential Greek debt exchange if voluntary, could still be considered a default event

Fitch says Greek debt exchange would be a default if bondholders terms were worse than original terms

Fitch says stressed sovereign debt exchange with worse terms is a technical default even if deemed voluntary

The gist is clear: the great unknown of how the rating agencies will treat even a "voluntary" restructuring is still in the closet.
FITCH OUTLINES RATING APPROACH TO A SOVEREIGN DEBT EXCHANGE

Fitch Ratings-London-06 June 2011: Given considerable market speculation regarding a possible debt exchange involving Greek ('B+' / Rating Watch Negative) sovereign debt, and subsequent interest in the rating approach adopted by Fitch Ratings in determining whether a debt exchange is an event of default and the rating implications before and after an exchange, the agency has outlined below its approach to sovereign debt exchanges based on its general 'Coercive Debt Exchange Criteria.'

There are two guiding principles in determining whether a debt exchange constitutes a default event or is an opportunistic 'liability management' exercise that has no rating implications. The first is an assessment of the terms on the new securities offered in the exchange and whether they are materially less advantageous to bondholders than the existing securities. The second guiding principle is whether the exchange is, or appears to be, necessary to avoid insolvency and/or illiquidity. Thus a debt exchange that offers new securities with terms that are worse than the original contractual terms of the existing debt and where the sovereign is subject to financial distress (which can be reflected in low issuer ratings, or ratings which have seen a sharp downward migration, or both) would be judged by Fitch to constitute a 'coercive' or more commonly known as a 'distressed debt exchange' (DDE) and hence a default event, even if bondholders' participation was deemed to be 'voluntary.'

A more complex situation would arise if the terms on the new securities, taken in the whole, were considered to be broadly neutral or better than the terms on the existing securities. For example, the offered securities may incorporate significant credit enhancements in the form of collateral and other features such as higher and/or step-up coupon profile. Determining whether the terms on the new securities imply an economic loss or gain relative to the terms of the existing securities can be complex and subjective, with a net present value analysis providing only a guide. Participation in the exchange would also have to be 'voluntary' in the sense that bondholders are not subject to 'sanction' if they choose not to participate. An important guide in this respect is that securities not tendered are not at greater risk of non-payment nor are they implicitly or explicitly subordinated to the securities created by the exchange.

If in Fitch's opinion, an announced exchange offer constitutes a DDE, the sovereign issuer rating will be lowered to 'C', indicating that default is highly likely in the near term. The ratings of the securities subject to the exchange will also be lowered to 'C'. On closing of the exchange offer and following confirmation that the exchange will be completed (for example because the minimum threshold for participation has been met), Fitch will place the issuer rating of the sovereign into default, specifically 'Restricted Default' (RD). The ratings of the tendered securities will be lowered to 'D' and will remain at that level for as long as the sovereign is rated 'RD'. The ratings of eligible securities that are not tendered and continue to be serviced will remain at 'C' until the exchange is completed with the issue of new securities.

Fitch will conduct a review of the credit profile of the sovereign in light of its anticipated post-exchange capital structure along with other relevant information after the offer date has closed and prior to completion marked by the issue of new securities. Based on such a review, Fitch may issue expected ratings on the new securities that would be confirmed on completion of the exchange (or very shortly thereafter) and receipt and review of the relevant documentation. On completion of the exchange, Fitch will also assign new issuer ratings to the sovereign and simultaneously withdraw the ratings of the securities extinguished by the exchange. The ratings of the securities not tendered in the exchange could be raised from 'C' to the level of the rating of the new securities if those ratings are higher and they are not in any way subordinated to the new securities. However, if securities not tendered into the exchange subsequently become non-performing, the sovereign (issuer) ratings will remain in default.

http://www.zerohedge.com/article/fitch-blows-greek-bailout-house-cards