The Wall Street Journal Imitates Me

Igor Panarin, the Russian academic who predicted the collapse of the United States, is back. This time on the front page of the Wall Street Journal. They left out much of the nutty stuff:

He based the forecast on classified data supplied to him by FAPSI analysts, he says. He predicts that economic, financial and demographic trends will provoke a political and social crisis in the U.S. When the going gets tough, he says, wealthier states will withhold funds from the federal government and effectively secede from the union. Social unrest up to and including a civil war will follow. The U.S. will then split along ethnic lines, and foreign powers will move in.

California will form the nucleus of what he calls "The Californian Republic," and will be part of China or under Chinese influence. Texas will be the heart of "The Texas Republic," a cluster of states that will go to Mexico or fall under Mexican influence. Washington, D.C., and New York will be part of an "Atlantic America" that may join the European Union. Canada will grab a group of Northern states Prof. Panarin calls "The Central North American Republic." Hawaii, he suggests, will be a protectorate of Japan or China, and Alaska will be subsumed into Russia.

"It would be reasonable for Russia to lay claim to Alaska; it was part of the Russian Empire for a long time." A framed satellite image of the Bering Strait that separates Alaska from Russia like a thread hangs from his office wall. "It's not there for no reason," he says with a sly grin.

Only In Seattle

Now correct me if I am wrong, but isn't the Puget Sound pretty salty already?

The icy streets are the result of Seattle's refusal to use salt, an effective ice-buster used by the state Department of Transportation and cities accustomed to dealing with heavy winter snows.

"If we were using salt, you'd see patches of bare road because salt is very effective," Wiggins said. "We decided not to utilize salt because it's not a healthy addition to Puget Sound."

Russia Gets Scarier

As I have mentioned before, as a long time student of Russia, the Putin regime scares me. Things are getting worse as the prepare to essentially ban dissent:

Putin did not specify who might pose a threat to Russia's stability. But in the past, he has often blamed Western security services of trying to destabilize the country using opposition groups and non-governmental organizations as their instruments.

"Any attempts to weaken or destabilize Russia, harm the interests of the country will be toughly suppressed," they quoted ex-KGB spy Putin as telling an annual meeting of top spies and security officers ahead of their professional holiday.

But what do you expect from a country which has a national holiday for the secret police?

The Day of Security Officers is marked annually on December 20, a day when in 1917 Bolshevik rulers created the CheKa secret police to suppress their foes. After a string of transformations, the Cheka became the KGB.

As president, Putin always personally attended the holiday meetings of security officials. Medvedev, a former corporate lawyer with no security background, stayed away and sent his chief of staff Sergei Naryshkin to deliver his greetings.

Al Gore and the Broken Window Fallacy

One of the things that drives me nuts (admittedly, there are a lot right now) is the constant insistance among environmentalists and politicians that "alternative energy" will "create jobs", somehow justifying large government expenditures to pay companies to do things which they would not normally waste money on. As Obama said when he met Al Gore today:

"We all believe what the scientists have been telling us for years now, that this is a matter of urgency and national security, and it has to be dealt with in a serious way," Obama said. "We have the opportunity now to make jobs all across this country, in all 50 states, to repower America. ... We are not going to miss this opportunity," he said.

OK, now if you want to argue that "green energy" has some sort of positive externalities in regards to the environment or national defense, you might have an argument, I am not saying it would be a good one, but you could at least make it, but to argue that it is an economic benefit in that it provides jobs, is a fallacy. Under no circumstances is it an economic benefit to subsidize people to do things in a manner which are a less efficient application of resources than they would otherwise. If solar power costs $20 per megawatt, and coal costs $10 a megawatt, it is never an economic benefit to pay someone $20 extra per megawatt in order to get them to put up solar cells. You might as well just use coal and pay them $10 to surf the Internet for Carrie Underwood videos.

This tactic, commonly used by politicians is a variation of the Broken Window Fallacy, by which you argue an economic benefit to smashing windows in order to employ window repairman, but at a loss to society as a whole.

The AP On Military Education

The AP, which has pretty much given up reporting the news and become an editorial service, has written an article on why soldiers are reenlisting in the military because... well apparently they can't get a job anywhere else. While obviously a bad economy probably has an effect, they take the John Kerry education approach.

Roughly 208,000 men and women left the military in 2007. Some were rank-and-file warriors, while others worked in specialized fields such as satellite communications or computer networking. Only about 30 percent of enlisted soldiers hold a bachelor's degree.

Only about 30 percent of enlisted soldiers hold a bachelor's degree? Well, how does that compare to the population at large? Well, according to the US Census, 27.1%, or less than the military, and this is not even counting officers, who almost all have degrees. So why exactly did they add the "only"?

Krugman and the Depression

When Paul Krugman recently won the Nobel Prize, I was worried, not so much that he didn't deserve it for his earlier work, but that he would use the fame to legitimize his much less rigorous later work. My fears were proven correct when I saw his new book The Return of Depression Economics, or rather a rehash of his old book of the same name, staring at me from the shelves of the local Barnes & Noble, complete with a "Nobel Prize Winner" emblazoned on the front cover.

The Wall Street Journal, however, once again in defense of reality economics, has an interesting editorial on a topic in his book today:

This reality shows most clearly in the data -- everyone's data. During the Depression the federal government did not survey unemployment routinely as it does today. But a young economist named Stanley Lebergott helped the Bureau of Labor Statistics in Washington compile systematic unemployment data for that key period. He counted up what he called "regular work" such as a job as a school teacher or a job in the private sector. He intentionally did not include temporary jobs in emergency programs -- because to count a short-term, make-work project as a real job was to mask the anxiety of one who really didn't have regular work with long-term prospects.

The result is what we today call the Lebergott/Bureau of Labor Statistics series. They show one man in four was unemployed when Roosevelt took office. They show joblessness overall always above the 14% line from 1931 to 1940. Six years into the New Deal and its programs to create jobs or help organized labor, two in 10 men were unemployed. Mr. Lebergott went on to become one of America's premier economic historians at Wesleyan University. His data are what I cite. So do others, including our president-elect in the "60 Minutes" interview.

One of the Best Arguments Against Something...

Is the fact that Pat Buchanan is for it...

I am a bit behind commenting on this subject, but this bailout of the Big Three is just idiotic. Personally I am rather upset at much of the bailout in general, but this is not a systemic problem, it is unique to the incompetence of the industry. Here is Herr Pat's spin:

In a good year, like 2005, Americans buy more than 17 million new cars, and West Europeans as many. Tens of millions in Eastern Europe, Russia, China, India and Southeast Asia are now moving into the middle class each year. These folks will all need or want one or two family cars. If we let the U.S. auto industry die, that immense and burgeoning market will be lost forever to America, and ceded to Asia.

"Who cares?" comes the free-traders' reply. Japanese and Koreans are setting up factories here. They can pick up the slack.

But that means Americans will work for and depend on foreign companies for a necessity of our national life as vital as the imported oil and gas on which our cars and trucks operate. All the profits of the mighty automobile industry in America will be sent abroad.

Hey genius, the profits go to the shareholders. Based on their profitability, I am sure more profit has gone to Americans who hold Honda stock than GM lately. In fact the Big 3 have been one of the biggest destroyers of wealth in the history of the world.

The Stupidest Housing Crash Idea

The most distressing part of the housing crash is how everyone is willing to throw away capitalism, over a crisis which hasn't even caused a recession yet. Having caused this crisis largely through idiotic government policy encouraging lenient lending standards, politicians now claim to be our saviors. Even they have not approached the idiocy of this idea though.

Napoleoni said that in Islamist finance, banks do not charge interest for loans and that this encourages entrepreneurs."

Money has to be invested," she said. "It has to be invested in the real economy, and through real growth, they can produce more money. This system could help us to get out of the current crisis."

Charles Kalm, a graduate assistant from the International Studies Institute, said Americans need to heed the advice of economists like Napoleoni."I think that we can all agree that our economic system is malfunctioning," he said.

"There are a number of things that are going to have to happen to help the average guy, all of the working people, the banks and to help with the main problem, which is faith in the economy."

Yeah, and exactly how well has this financial vehicle worked out for the Islamic world? Even with all of their oil resources, the UN has to do special reports on the economic disaster that is the Arab world. Despite all this wealth, their financial insitutions are a joke. For example:

With few exceptions, the region is plagued by corrupt, state-dominated economies, excessive regulation and bureaucracy, and poorly constructed legal and regulatory frameworks that hinder private sector development, foreign direct investment, and job creation. The 280 million people of the 22 Arab countries combined have a gross domestic product less than that of Spain; 25 percent of Arabs live below the poverty line; foreign direct investment rose everywhere last year, except the Middle East; total nonfossil fuel exports from the entire region amount to less than the total exports of Finland; the Arab world has witnessed a near zero percent growth rate over the past 30 years, while all other developing countries grew at 2.5 percent per annum.

Racist!

It is no surprise that the New York Times should endorse Obama, this is the newspaper that sponsors Paul Krugman, Maureen Dowd and Bob Herbert after all. But could they at least have the class not to make up fake claims of racism while doing it?

In the same time, Senator John McCain of Arizona has retreated farther and farther to the fringe of American politics, running a campaign on partisan division, class warfare and even hints of racism. His policies and worldview are mired in the past. His choice of a running mate so evidently unfit for the office was a final act of opportunism and bad judgment that eclipsed the accomplishments of 26 years in Congress.

Of course, while calling Governor Palin as unfit for office, they claim that Obama is, endorsing Obama's own circular logic that running for office itself is the primary qualification.

As tough as the times are, the selection of a new president is easy. After nearly two years of a grueling and ugly campaign, Senator Barack Obama of Illinois has proved that he is the right choice to be the 44th president of the United States.

In other news, the New York Times has been downgraded to junk status this week...

Unbelievable.

More On The Moron

The idiotic thing, his warning of a Obama presidency wasn't even the stupidest thing he said in that speech.

"I've forgotten more about foreign policy than most of my colleagues know, so I'm not being falsely humble with you. I think I can be value added, but this guy has it," the Senate Foreign Relations chairman said of Obama. "This guy has it. But he's gonna need your help. Because I promise you, you all are gonna be sitting here a year from now going, 'Oh my God, why are they there in the polls? Why is the polling so down? Why is this thing so tough?' We're gonna have to make some incredibly tough decisions in the first two years. So I'm asking you now, I'm asking you now, be prepared to stick with us. Remember the faith you had at this point because you're going to have to reinforce us."

I would agree that he has forgotten a lot, this is the guy after all, who thinks that we kicked Hezbollah out of Lebanon.

"Joe the Dumber" Speaks

Earlier I asked just how dumb Joe Biden is, Joe apparently didn't realize that was a rhetorical question.

"Mark my words," the Democratic vice presidential nominee warned at the second of his two Seattle fundraisers Sunday. "It will not be six months before the world tests Barack Obama like they did John Kennedy. The world is looking. We're about to elect a brilliant 47-year-old senator president of the United States of America. Remember I said it standing here if you don't remember anything else I said. Watch, we're gonna have an international crisis, a generated crisis, to test the mettle of this guy."

OK, so if we elect this young an inexperienced guy, that will guarantee an international incident on the scale of the Cuban Missile Crisis? And this is supposed to a reason to vote for him?

More on Krugman

The Wall Street Journal has an excellent article on what praises Herr Kruggy deserves, and doesn't deserve:

In his popular writing, Paul Krugman is at his best when defending free trade. My favorite is example is his "Ricardo's Difficult Idea," published in the mid-1990s, in which he shares a frustration many of us economists have felt -- that the vast majority of noneconomist intellectuals don't understand David Ricardo's famous insight about free trade almost 200 years ago.

Ricardo grasped that people will specialize in producing the goods and services in which they have a comparative advantage. The result is that we never need to worry about low-wage countries competing us out of jobs; the most they can do is change those goods and services in which we have a comparative advantage. For example, though you can rake leaves faster than the teenager next door, it still makes sense to hire him because you have a comparative advantage in writing software programs. Mr. Krugman points out that most noneconomist intellectuals are unwilling to take even 10 minutes to understand this. But that doesn't stop them from writing about trade as if they're informed.

Don Luskin, however, resurrects the Krugman Truth Squad, with the cleverest line:

More likely, the Nobel committee decided deliberately to overlook Krugman’s political extremism, just as it chose to overlook John Nash’s schizophrenia in 1994. That’s not to say Krugman is crazy, though he has stated: “my economic theories have no doubt been influenced by my relationship with my cats.”

Whatever the committee was thinking, the only remaining question is what the living Paul Krugman will do with his $1.4 million prize. Will he pay taxes on it at the low rates established in 2003 by George W. Bush, a president and a policy that Krugman has worked so assiduously to discredit? Or will he voluntarily pay at the higher rates he advocates?

It's the End of the World as We Know it...

Well Paul Krugman, yes that Paul Krugman has won a Nobel Prize. As I have mentioned before he is a bit of a tragic character right out of Shakespeare, the young ambitious bright economist turned idiot by a former oilman from Texas. His early work was good, and he probably deserves the award for that, it is just a tragedy for all this money ($1.4 million) to go to someone who has become such a no-talent hack. A Michael Moore with an MIT degree. Have any Nobel Prize winners been so thoroughly debunked by a bunch of nobodies on the Internet, including me? Well, there is Jimmy Carter of course...

The Debate

I am just amazed at how bad of a speaker Barack Obama can be. Maybe he is the one going senile?

BROKAW: We've run out of time. We have this one-minute discussion period going on here. There are new economic realities out there that everyone in this hall and across this country understands that there are going to have to be some choices made. Health policies, energy policies, and entitlement reform, what are going to be your priorities in what order? Which of those will be your highest priority your first year in office and which will follow in sequence?

------------------------------------------

Obama: Health care is priority number two, because that broken health care system is bad not only for families, but it's making our businesses less competitive.

And, number three, we've got to deal with education so that our young people are competitive in a global economy.

Education?

And we can do it, but we're going to have to make an investment. The same way the computer was originally invented by a bunch of government scientists who were trying to figure out, for defense purposes, how to communicate, we've got to understand that this is a national security issue, as well.

The military created the computer in order to communicate?

Despite all that, I was able to go to the best schools on earth and I was able to succeed in a way that I could not have succeeded anywhere else in this country.

What is wrong with the rest of the country?

We haven't been doing enough of that. We tend to be reactive. That's what we've been doing over the last eight years and that has actually made us more safe.

An interesting endorsement of the Bush administration.

Now, Senator McCain suggests that somehow, you know, I'm green behind the ears and, you know, I'm just spouting off, and he's somber and responsible.

Green behind the ears?

Economists on the Bailout

As I mentioned yesterday regarding congressman Brian Baird, I am right and he is wrong. Now what is this guy doing in congress?

All the economists criticized the government-mandated accounting rules, so-called “mark to market.” While these rules were reasonable in principle, they were applied to situations that they weren’t meant to apply to. Paul Evans, an economics professor at Ohio State University, explained that you run into real problems when “someone trades a tiny fraction of a particular type of asset at a very low price to clear it off the books. It is then used to estimate the price of all these other assets.”

The Root of the Problem

I agree that this financial crisis is a problem, but don't have much faith in the wisdom of our leaders to handle it correctly. One example is Congressman Brian Baird from Washington State:

“You’ll be screwed,” Baird said, drawing a nervous laugh from his audience.

Business loans, home loans, car loans — and, of course, college student loans — would dry up immediately, the Vancouver Democrat told students.

“The whole (lending) chain is frozen up” because lax regulation has allowed shady accounting practices that have massively overstated the value of assets now gone bad, Baird said.

Except he has this completely backwards. From a rather good editorial in this morning's Wall Street Journal:

OK, get out your NoDoz and let's wade in. Under current interpretation of accounting rules, banks can be obliged to value loan holdings based on their liquidation or fire-sale value, even if (as now) the fire-sale values are lower than might be suggested by the cash flow and payoff prospects of the underlying assets.

Now recall that accounting is a language of abstraction. In the normal case of a public company, whatever method it uses to value its assets, it merely provides a benchmark for investors to make their own judgments. Nobody takes accounting values as the final word.

Banks, though, are subject to regulatory capital standards and therefore can be rendered insolvent overnight based on an accounting writedown. At the moment, many banks are clinging to "market" values for loans that are higher than probable fire-sale values, and doing so on tenuous grounds. In kibitzing over the Paulson plan, indeed, one knotty question was how Treasury could buy such loans at a price "fair to taxpayers" without propelling the sellers into federal receivership.

Because of all this, the regulatory state finds itself in a somewhat absurd position --
its own rules could render many financial institutions insolvent in a manner inconvenient to the state.

The Spin of Michael Moore

Now I am not usually impressed with the intellectual arguments of Michael Moore, but even by his standard this spin is pretty lame:

A lot of people are wondering why the right wing of the Republican Party joined with the left wing of the Democratic Party in voting down the thievery. Forty percent of Democrats and two-thirds of Republicans voted against the bill.

Here's what happened:

The presidential race may still be close in the polls, but the Congressional races are pointing toward a landslide for the Democrats. Few dispute the prediction that the Republicans are in for a whoopin' on November 4th. Up to 30 Republican House seats could be lost in what would be a stunning repudiation of their agenda.

The Republican reps are so scared of losing their seats, when this "financial crisis" reared its head two weeks ago, they realized they had just been handed their one and only chance to separate themselves from Bush before the election, while doing something that would make them look like they were on the side of "the people".

So apparently the Democrats aren't even concerned about looking like they are on the side of the people...

In better news, an American Carol, which is a virtual parody of Moore, comes out this weekend, I look forward to seeing it.

He Wasn't Looking at His Watch

Overall the debate wasn't that exciting. I thought McCain did well, but probably not enough to make a significant change. The point where Obama had to look to see whose bracelet he was wearing was pretty cringe inducing though.

Would the Bailout Turn a Profit?

I am rather suspicious of this deal, but it is an interesting argument. From the WSJ:

You can slice the numbers a lot of different ways. My calculations, which assume 50% impairment on subprime loans, suggest it is possible, all in, for this portfolio to generate between $1 trillion and $2.2 trillion -- the greatest trade ever. Every hedge-fund manager will be jealous. Mr. Buffett is buying a small piece of the trade via his Goldman Sachs investment.

Over 10 years this could change the budget scenario in D.C., which can also strengthen the dollar. The next president gets a heck of a windfall. In the spirit of Secretary of State William Seward's purchase of Alaska for $7 million in 1867, this week may be remembered as Paulson's Folly.

Practicing Economics Without a License

I should be worried that the AP will charge me several thousand dollars for posting this bit, but here goes anyway:

"The financial markets are in quite fragile condition, and I think absent a plan they will get worse," Mr. Bernanke said.

Ominously, he added, "I believe if the credit markets are not functioning, that jobs will be lost, that our credit rate will rise, more houses will be foreclosed upon, GDP will contract, that the economy will just not be able to recover in a normal, healthy
way."

GDP is a measure of growth, and a decline correlates with a recession.

No, actually GDP is a measure of, well, Gross Domestic Product. GDP growth would be a measure of growth. A decline in GDP doesn't just correlate with a recession, it is the definition of a recession.

Just How Dumb is Joe Biden?

Sarah Palin may not have a graduate degree, but there is no way she could be as dumb as this moron. You would expect better from someone who (didn't) graduate from the top half of his law school.

Joe Biden’s denunciation of his own campaign’s ad to Katie Couric got so much attention last night that another odd note in the interview slipped by.

He was speaking about the role of the White House in a financial crisis.

“When the stock market crashed, Franklin Roosevelt got on the television and didn’t just talk about the princes of greed,” Biden told Couric.

“He said, ‘Look, here’s what happened.’”

The Speech

I am hardly the target audience, but can anyone explain this bit to me?

John McCain likes to say that he’ll follow bin Laden to the Gates of Hell – but he won’t even go to the cave where he lives.

What, is Barry taunting him for not going there personally? This is a bit of a weird charge, is this idiot seriously accusing McCain of not being militant enough?

And this bit, emphasis added:

Passions fly on immigration, but I don’t know anyone who benefits when a mother is separated from her infant child or an employer undercuts American wages by hiring illegal workers.

That is just bad economics, I know 3 people who benefit, the illegal workers who get jobs better than their other options, the employers who get to pay lower wages, and the consumer who pays less for his product. This does not make it right, but claiming that nobody benefits is just ignoring basic economics.

Calling Central Casting

Barack Obama today, with his bizarre spin in response to charges of race baiting:

"I was in union, Missouri which is 98 percent white - a rural, conservative. and what I said was what I think everybody knows, which is that I don't look like I came out of central casting when it comes to presidential candidates. "

Well, evidently Barack hasn't been paying much attention to the television or movies since the late 70s.

Dennis Haysbert as President David Palmer in TV's '24'

D.B. Woodside as President Wayne Palmer in TV's '24'

Morgan Freeman as President Tom Beck in Deep Impact

Is Obama Anti-Science?

The Bush administration has been criticized, and often quite legitimately, for being anti-intellectual, not listening to experts or scientists on an issue.  But in fact is Barack Obama, the Chosen One, the same way, especially in regards to economists.

The most famous example was from the debates, where he answered that he would raise the capital gains tax, regardless of whether experts said it would lower tax revenue, that fairness was the important factor.

Well now in an interview with NPR, he repeats the same argument, in regards to a "windfall profit tax" on oil revenues:

You know because of the timing of our program that many of our listeners are in their cars. And so I want to ask you about your proposal to force big oil companies to share their record-breaking windfall profits. It's hard to find an economist who supports the idea of a windfall profits tax. Most argue that this would stifle investment in oil discovery and oil production precisely at the moment when the U.S. should be encouraging more.

Classic economic theory says you don't meddle in the markets. Look, I mean, most economists buy into that approach. Exxon Mobil made $12 billion last quarter. They made $11 billion before that, and $11 billion before that, and not all of this is going into research and development — and families need some relief.

Now, I am the first to admit that what we need is a comprehensive plan, and that's what I've been putting forward for the last 18 months — making sure that we're increasing fuel-efficiency standards on cars drastically, investing in the retooling so that we can have plug-in hybrids. I have set a goal that we reduce our oil consumption by 30 percent over the next 20 years. So that's the long-term answer to rising gas prices.

But in the short term, the notion that oil companies that have been making record profits, hand over fist, can't give a little bit of that back to make sure that not just drivers but senior citizens on fixed income are going to have the ability to pay for heating this winter, which is going to be a huge potential problem — I don't think that's too much to ask.

Got the Bastard

As someone who has spent a fair amount of time in Srebrenica, I was happy to see this story.

The lawyer for former Bosnian Serb leader Radovan Karadzic say he will conduct his own defense before the International Criminal Tribunal for the Former Yugoslavia in The Hague, where he faces charges of genocide and war crimes committed in Bosnia in the 1990s. Karadzic was arrested near Belgrade on Monday and could be extradited to The Hague within days, but the fact that he's been on the run for nearly 13 years and working and living in Belgrade in disguise raises questions over who knew, why he was arrested now and whether his one time military commander, Ratko Mladic, might soon face the same fate. Sonja Pace has this report from London.

Of course the way the Hague works, it will be another decade before he is convicted, but at least he is not free.

Bizarre Moral Superiority

Wesley Clark, I can't bear to call this idiot general, digs a deeper hole:

"John McCain basically served honorably while in uniform, he did everything the country could have asked," Clark told CNN. "What John Kerry did is John Kerry got out of the uniform and took a judgment, a judgment I didn't agree with at the time, but he had the moral courage to stand up for himself and oppose the conflict in Vietnam.”

On what kind of bizarre planet does a former military officer claim that it is more courageous to get out of the military early and come home and slander the troops, than it is to survive 5 1/2 years in a POW camp, turning down early release several times, and then come home to serve further, retiring as a captain?

This guy is pathetic.

Wesley Clark: Then and Now

Now I have characterized the Democrat's previous attacks on John McCain's military service as poorly thought out, but this one is downright idiotic, not to mention offensive:

Because in the matters of national security policy making, it’s a matter of understanding risk, it’s a matter of gauging your opponents and it’s a matter of being held accountable. John McCain’s never done any of that in his official positions. I certainly honor his service as a prisoner of war. He was a hero to me and to hundreds of thousands of millions of others in the armed forces as a prisoner of war. He has been a voice on the Senate Armed Services Committee and he has traveled all over the world. But he hasn’t held executive responsibility. That large squadron in the Navy that he commanded wasn’t a wartime squadron. He hasn’t been there and ordered the bombs to fall. He hasn’t seen what it’s like when diplomats come in and say, `I don’t know whether we’re going to be able to get this point through or not. Do you want to take the risk? What about your reputation? How do we handle it publicly?

Now as Bob Shieffer points out, Barack Obama doesn't have this experience either. But what has Wesley Clark said on the importance of military experience before in those running for president? Well, we know, because he gave a speech at the Democratic National Convention in 2004, the entire theme of which was how John Kerry's relatively limited military experience made him qualified for president:

John Kerry has heard the thump of enemy mortars.

CLARK: He's seen the flash of the tracers. He's lived the values of service and sacrifice. In the Navy, as a prosecutor, as a senator, he proved his physical courage under fire. And he's proved his moral courage too. John Kerry fought a war, and I respect him for that. And he came home to fight a peace. And I respect him for that, too.

(APPLAUSE)

John Kerry's combination of physical courage and moral values is my definition of what we need as Americans in our commander in chief. And John Edwards with his leadership and extraordinary intelligence, he's going to be a great member of that command team.

Now of course, none of this counts.

Bizarrely Obama himself gives a weak response, trying to draw some absurd non-existent parallels:

For those who have fought under the flag of this nation – for the young veterans I meet when I visit Walter Reed; for those like John McCain who have endured physical torment in service to our country – no further proof of such sacrifice is necessary. And let me also add that no one should ever devalue that service, especially for the sake of a political campaign, and that goes for supporters on both sides.

Excuse me? Has criticizing Obama's extensive military experience been a major campaign issue, and I just haven't realized it?

Supreme Court Idiocy

Reading the decisions of Justice Scalia is like reading poetry, with clear, concise, lucid logic. Reading the decisions of Stevens, reminds one more of a parody like Hitchhikers Guide to the Galaxy. From the recent decision on the 2nd amendment:

The Court would have us believe that over 200 years ago, the Framers made a choice to limit the tools available to elected officials wishing to regulate civilian uses of weapons, and to authorize this Court to use the common-law process of case-by-case judicial lawmaking to define the contours of acceptable gun control policy.

Uhh, I am no lawyer, hell I am not even a Supreme Court justice, but wasn't the whole point of the Bill of Rights to limit the power of the government? I seem to remember that from my 7th grade history class. Guess I went to a different school. Oddly enough, Stevens used the exact opposite logic to rule that the Supreme Court's interpretation of the constitution, not the commander in chief, was the ultimate power in deciding how military detainees should be handled. I don't recall him complaining about the constitution tying anyone's hands then.

Sell Short!

I guess some Wall Street investors have been reading my blog.

Investors are getting worried that the commodities party may be drawing to a close, and Wall Street is introducing funds designed to capitalize on the choppy market.

Over the past seven years, commodity prices have soared with the S&P GSCI Total Return Index rising nearly 300%. But starting this spring, with the huge exception of oil, many key prices have eased.

Several new funds and securities take short positions on commodities, allowing investors to benefit from any drop in prices. But investors should exercise caution. These funds often pursue complicated strategies, some going long on certain commodities and short on others. And, if their particular bets go sour, they could pile up big losses. Many funds are leveraged, which will magnify gains or losses on the investments.

Is This a Good Strategy?

Let's see, McCain grandfather was a 4 star admiral, his dad was a 4 star admiral, he was a captain who spent 5 1/2 years as a POW, one of his sons was a naval aviator, one of his sons is at the Naval Academy, and another son is a Marine Lance Corporal who just got back from Iraq. So let's attack him for being out of touch with military families, yeah, that's the ticket. As my cousin Bill Bennett says:

Second, do the Democrats really want to try to lecture family McCain on how they should feel about returning home and being in the battlefield? The entire McCain bloodline, up and down the generations, is defined by being in the battlefield and away from home. Do they really want to tell a man who turned down early release and spent five and a half years in a POW camp that he is insensitive to the desires of returning home? Do they really want to tell a man whose father and grandfather are military heroes that the most important thing is returning home? Do they really want to tell a man whose own son has signed up and fought in Iraq about the importance of coming back home?

Whine, Whine, Whine

It is amazing how much this guy whines. Grow up for God's sake. A must read editorial from the National Review.

We now are down to two presidential candidates. One went to the Ivy League and Harvard Law School as a young man. The other spent years of his youth in a Vietnam Prisoner of War camp and suffered lifelong injuries. Guess which one whines more about his hardships?

Barack Obama is many things — a senator, a gifted orator, and a charismatic figure. But he’s also a whiner.

More On the Commodity Bubble

I am dubious as to his solutions, but another writer backs up my thesis that we are in the middle of another asset bubble.

Nothing makes conservatives queasier than regulation, especially of financial markets. But oil’s meteoric rise from $50 in January 2007 to almost $139 on Friday calls for drastic measures that might solve this crisis without a measure as drastic as the gas tax Charles Krauthammer proposed on Friday.

In the past, energy price appreciations of last week’s magnitude have typically been caused by supply disruptions — like the 1973 OPEC embargo, or the 4 million barrels per day in lost production that followed the Islamic Revolution in Iran in 1979, which restricted international oil supplies for several years and caused a spike in prices.

Brownshirt Pat

I have never been much of a Pat Buchanan fan, in fact I despise the guy, but even his recent book is below his normal standards. Eminent military historian Victor Davis Hanson has a good takedown of it:

Take the new book by conservative pundit Patrick Buchanan, Churchill, Hitler and “The Unnecessary War”: How Britain Lost Its Empire and the West Lost the World. Buchanan argues that, had the imperialist Winston Churchill not pushed poor Hitler into a corner, he would have never invaded Poland in 1939, which triggered an unnecessary Allied response.

Maybe then the subsequent world war, and its 50 million dead, could have been avoided. Taking that faulty argument to its logical end, I suppose today a united West might live in peace with a reformed (and victorious) Nazi Third Reich.

And I Thought the Guys Who Work at the DMV were Inefficient

I read Bernard Lewis' what went wrong, which covers some of this. This factoid certainly stood out:

A prayer generally takes an average of 10 minutes, but it can be extended if a worshipper chooses to recite one of the longer verses of the Koran.

And before the prayers themselves, there is also a mandatory ablution during which worshippers must wash their faces, hands and arms, feet and heads. In large office buildings, the trips to the bathroom can also eat away at valuable work time.

Qaradawi's plea to reconcile faith and productivity may hit some hurdles as it risks upsetting the deeply entrenched custom of "prayer breaks" at work.

Society's increased Islamisation over the past 30 years has already silenced some critics of long prayer sessions.

According to an official study, Egypt's six million government employees are estimated to spend an average of only 27 minutes per day actually working, reflecting a real problem with productivity.

No News is Good News

Maybe Obama get the guts to visit now.

BAGHDAD, June 1 (Reuters) - Nineteen U.S. soldiers were killed in Iraq in May, the U.S. military said on Sunday, the lowest monthly death toll since U.S. forces invaded to topple Saddam Hussein in 2003.

The number of Iraqi civilians killed in the same month plunged to 505 after reaching a seven-month high of 968 in April, figures obtained by Reuters from Iraq's interior, defence and health ministries showed.

The U.S. military says violence in Iraq is at a four-year low following crackdowns by U.S. and Iraqi forces on Shi'ite militias in southern Basra and Baghdad and on al Qaeda in the northern city of Mosul, its last major urban stronghold.

Told Ya

From the Telegraph:

Lehman's latest report - Is it a Bubble? - says commodity index funds have exploded from $70bn (£36bn) to $235bn since early 2006. This includes $90bn of fresh money. Energy takes the lion's share. Every $100m flow of investment money into oil lifts crude prices by 1.6pc, it said.

"We see many of the ingredients for a classic asset bubble," said Edward Morse, Lehman's oil expert.

Does Anyone Really Think This is a Winning Strategy?

Set aside the fact that this is insulting, it is just plain stupid.

A prominent local Barack Obama backer bashed John McCain's military record Monday, calling the Republican presidential candidate a "self-promoter."

In a nearly-half hour speech, Democratic congressional candidate Bill Gillespie praised Obama, his party's leading White House hopeful..."

Admirals' sons," Gillespie said, unopposed for the Democratic nomination in the 1st Congressional District held by Republican Rep. Jack Kingston, "were treated like royalty. They were privileged people. They were given a silver spoon. Their careers were prepared for them."

Don't Know Much About History...

Via Hot Air, Obama shows that he was not a history major in college. Maybe he should look up FDR and Truman, and a little concept called unconditional surrender.

The other side can label and name-call all they want, but I trust the American people to recognize that it is not surrender to end the war in Iraq so that we can rebuild our military and go after Al Qaida’s leaders.

I trust the American people to understand that it is not weakness, but wisdom to talk not just to our friends, but to our enemies, like Roosevelt did, and Kennedy did, and Truman did.

Obama Quote of the Day

From columnist Charles Krauthammer:

Obama's Philadelphia oration was an exercise in contextualization. In one particularly egregious play on white guilt, Obama had the audacity to suggest that whites should be ashamed that they were ever surprised by Wright's remarks: "The fact that so many people are surprised to hear that anger in some of Reverend Wright's sermons simply reminds us of the old truism that the most segregated hour of American life occurs on Sunday morning."

That was then. On Tuesday, Obama declared that he himself was surprised at Wright's outrages. But hadn't Obama told us that surprise about Wright is a result of white ignorance of black churches brought on by America's history of segregated services? How then to explain Obama's own presumed ignorance? Surely he too was not sitting in those segregated white churches on those fateful Sundays when he conveniently missed all of Wright's racist rants.

Michelle Obama "Barack Walks on Water"

This interview with Michelle and Barack Obama I picked up at Hot Air is just bizarre.

Michelle: The fundamental changes that he has made in just 15 months, in the way people see themselves, in the way people see their futures, the way young people are looking at their possiblilities, they way people are talking about politics, even though we slip sometimes. We don't get pulled down into the hold ways of playing the political game. Changes have happened and it makes every challenge, every frustration worth it.

What the hell is she talking about? Barack hasn't changed a thing, much less these earthshattering events that she is claiming.

The Wall Street Journal Imitates Me

Your humble blogger, in a post titled Another Asset Bubble?, a little over a month ago:

It is simple supply and demand. In the 90s people poured money wildly into the stock market, and it bubbled and crashed. Earlier this decade the same thing happened to the housing market, and we are now feeling the results. Now the money is being poured into the commodities market, especially oil and gold, and pushing the prices to unsustainable levels. How long before those "re-adjust" too?

From the Wall Street Journal this Monday:

No doubt commodity traders are having a field day, but what they are speculating on is the Fed's refusal to stop the free-fall of the dollar. The weak dollar has created another speculative bubble, this time in commodities. Oil prices have been surging despite only the usual geopolitical risks to global supplies and despite a recent International Energy Agency estimate that global oil demand will fall as growth slows.

I guess it is about time they put me on the editorial board...

Gas Tax Politics

I am a McCain supporter, although not as enthusiastically as I was in 2000, but he is by no means immune from criticism. Senator McCain, although known for his independence, and rightfully for the most part, is still susceptible to populist silliness. In this case, both he and Hillary Clinton are proposing a gas tax holiday too offset the high price of gas, with Barack Obama opposed.

While the popular appeal of this is, of course, strong. Heck, I don't like having to pay $3.50 a gallon any more than anyone else. The economics though, doesn't make any sense. What does a tax do to the demand for a good? It is a first quarter micro question. The answer is that it raises, the total sale price of a good, decreasing the quanitity demanded, while decreasing the amount received by the producer. So if the goal is to lower the price of gas, you should actually raise the tax. Eliminating the tax will just increase demand, and thus the real price.

Of course Obama, also showing a complete lack of understanding of economics proposes a "windfall profits" tax on oil companies, which will do nothing more than discourage future production, and bizarrely target domestic producers, while benefiting foreign companies, in comparison to a tax paid at the pump.

I Didn't Know Obama had a College Named After Him

From a recent article on his "bitter" comments:

The Illinois senator defended himself at the CNN forum, emphasizing that he was a devout Christian" and saying that while his wording may have been "clumsy," he did not mean to offend religious voters. "What I was referring to is in no way demeaning to a faith that I myself embrace," Mr. Obama said at the forum, held at Messiah College in Grantham, Pa.

Liberal Fascism

I am an avid reader, and digest several books a month, but never get a chance to talk about them. This book was interesting enough to warrant a post.

As an undergrad I majored in Russian and East European Studies, specializing in 20th century Soviet history, and was always befuddled why people considered Stalinist Russia to be left-wing, while Hilter's Germany was right wing. To me they both seemed the same to represent the same political philosophy, the power of the state over the individual, as the key driver of history.

Goldberg expounds on this observation and writes a comprehensive history of why fascism is in fact a left-wing, modern day liberal philosophy, and not right-wing or conversative. While he repeatively makes clear that he is not saying that modern day liberals are not fascist, almost to the point of annoyance, he does say that they have inherited a philosophical basis. While much of this well argued, some of his arguments, such as those attacking the film Dead Poets Society, are a bit stretched. The book definitely serves its purpose in starting a conversation on the meaning of fascism, and the modern American left though, and deserves reading.

What More Can Barack Do to Sabotage His Campaign?

Obama shows why he is not ready for primetime:

“You go into these small towns in Pennsylvania and, like a lot of small towns in the Midwest, the jobs have been gone now for 25 years and nothing’s replaced them. And they fell through the Clinton administration, and the Bush administration, and each successive administration has said that somehow these communities are gonna regenerate and they have not. And it’s not surprising then they get bitter, they cling to guns or religion or antipathy to people who aren’t like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustrations.”

Uhh, excuse me. Anti-trade sentiments because their jobs have disappeared? Who exactly was running around Ohio blaming NAFTA for all the job losses?

Why Does Barack Obama Lie So Much?

Does he think he can get away with it, because the press is on his side. This strategy didn't work for Hillary....

Hillary At Eagle Base

Having spent more time at Eagle Base than just about anyone, I was rather amused to hear, and then see, Hillary Clinton's dramatic tale of arriving there. It is also amusing to see Democrats finally catch up to what the rest of us have known for years, the Clintons lie.

Not Divisive, Wrong

Earlier in the week Slate's Mickey Kaus had this wise observation on Barack Obama's speech on race:

As such, Reverend Wright's comments were not only wrong but divisive, divisive at a time when we need unity;

Doesn't Obama mean Rev. Wright's comments were 'not only divisive but wrong,' rather than the other way around? Isn't it worse to be wrong than "divisive"? Is unity the overriding virtue for Obama?

Welcome to the world of left-wing identity politics, where unity and loyalty to the collective are praised above truthfulness. In this spirit I noticed part of Jeremiah Wright's infamous 9/11 speech, reprinted on CNN's website.

We bombed a plant in Sudan to pay back for the attack on our embassy, killed hundreds of hard working people, mothers and fathers who left home to go that day not knowing that they’d never get back home.

In fact, we didn't killed hundreds of people in the Sudan, the attacks were timed in the middle of the night, to avoid casualties, only a handful of people were wounded.

Sudanese newspapers reported Saturday that the strike had caused $100 million worth of damage at the factory. Five Sudanese were reported seriously wounded.

See Barack, it is not a matter of being divisive, it is a matter of being wrong, and a matter of your lack of judgment.

Barack Obama Is Just a Typical Black Man

Me thinks he just needs to shut up:

The point I was making was not that my grandmother harbors any racial animosity, but that she is a typical white person. If she sees somebody on the street that she doesn't know (pause) there's a reaction in her that doesn't go away and it comes out in the wrong way.

Come on guy, I know you mean well, but lay off granny already. Are you really that self-unaware?

Another Asset Bubble?

It is simple supply and demand. In the 90s people poured money wildly into the stock market, and it bubbled and crashed. Earlier this decade the same thing happened to the housing market, and we are now feeling the results. Now the money is being poured into the commodities market, especially oil and gold, and pushing the prices to unsustainable levels. How long before those "re-adjust" too? Perhaps it has already begun?

March 19 (Bloomberg) -- Gold plunged the most since June 2006, leading a decline in commodity prices, on speculation the slump in the dollar will end as the Federal Reserve eases the pace of interest-rate reductions.

The UBS Bloomberg Constant Maturity Commodity Index fell 61.3866, or 4.1 percent, to 1,428.009 at 5 p.m. in New York, led by declines in soybeans, wheat, cocoa and crude oil. The index of 26 commodities has dropped in three of the past four sessions and is down 9.3 percent from a record on Feb. 29.

New Obama Election Strategy: Diss Granny

Before I get onto Barack Obama's speech, I have to point out the quote of the day, from the Weekly Standard:

All of this suggests a weakness in Obama's character, a shrinking back from principled decisions if they seem too costly. When John McCain challenged his own party on causes that could sink his political career, Obama voted "present" to avoid taking a position on controversial bills in the Illinois senate. During his captivity in Vietnam, McCain refused to denounce the United States or to be released from prison until his fellow soldiers could join him. Obama couldn't find the moxy to stop attending the church of a minister who makes anti-Americanism an indispensable doctrine of his faith.

As far as the speech itself, this part stood out:

I can no more disown him than I can disown the black community. I can no more disown him than I can my white grandmother – a woman who helped raise me, a woman who sacrificed again and again for me, a woman who loves me as much as she loves anything in this world, but a woman who once confessed her fear of black men who passed by her on the street, and who on more than one occasion has uttered racial or ethnic stereotypes that made me cringe.

I am sorry, call me old fashion, but anyone who publicly criticizes their grandmother to score political points, is not going to get my election for dogcatcher, much less president.

Barack Obama: But I Wasn't at "That" Racist Organization

I have been following the controversy on Barack Obama and his pastor and spiritual advisor of 20 years, Jeremiah Wright, who Obama now apparently claims complete ignorance of. The website Newsmax reported that Obama was actually at a sermon that he previously claimed he was unaware of. The Obama campaign struck back, with convincing evidence that he was elsewhere, he was speaking at a convention of "La Raza" The Race, the controversial (to say the least) Hispanic identity group.

Well, OK, the guy running as the person to bring all the races together wasn't at a speech preaching black power, he was at a group that promotes Hispanic power. Why does that not make me feel any better?

Pat Buchanan Goes Nuts on McCain and Free Trade

I was never much of a Pat Buchanan fan, even before he became a crypto-fascist. But this rant on McCain, the Boeing tanker deal (or lack of) and free trade, is idiotic even by his standards.

The contract could run to $100 billion and is a body blow to Boeing in its duel to the death with Airbus. Two-thirds of all air-to-air refueling tankers are used by the United States. The contract gives a 30-year lease on life to the expiring Airbus A330 and means early death for Boeing's 767, the U.S. model for the tanker.

Oh yeah, because monopolies protected from foreign competition ripping off the government by bribing their employees makes for much better economics and government.

For a good article on why Boeing really lost the deal see the National Review.

The sordid story of the Boeing lease deal took what may be its final turn on February 29, when the Air Force announced that it will buy 179 tankers — nearly twice as many — from Boeing’s rival, Airbus. The deal is valued at $35 billion (for perspective, $26 billion in 2001 was worth $31 billion in today’s dollars). McCain is proudly touting a government estimate of $6.2 billion in savings for the taxpayers that ultimately resulted from his aggressive investigation. Democrats are attacking him for blocking Boeing, one of the nation’s top corporations in both congressional lobbying and campaign contributions.

Bizarre Political Quote O' the Day

It is apparent the Clinton camp is getting desperate, Bill must be offended by the low quality of the spin recently, regarding their assertion that Obama does not pass the national security test:

Senior advisers to Sen. Hillary Rodham Clinton (D-N.Y.) on Monday sought to reconcile the campaigns assertion that rival Sen. Barack Obama (D-Ill.) has not passed the commander-in-chief test with the Clintons hints in recent days that the New York senator would tap Obama as a running mate.

Howard Wolfson, Clinton's chief spokesman, said during a conference call with reporters that Clinton would not pick a running mate who has not met the national security threshold as Clintons military advisers and Wolfson put it on the call but that it is possible Obama could meet that threshold by this summer's Democratic convention.

Now I would have to agree that he doesn't meet the standard, although Hillary is only a marginal improvement in this respect, but how exactly is he supposed to them meet this standard by July? What has he not learned in the past 5 decades that he can make up in the next 4 months? Is there some type of correspondence course he needs to take?

Obama's Weakness

The fallout over his NAFTA comments actually presents a threat to Barack Obama. The fact is, matters of policy do not really affect his support, it is doubtful that most of his supporters could even identify any specifics of his policy stands beyond such vague platitudes such as "End the war in Iraq!" His attraction though is based entirely on the charismatic "Messiah" appeal, that he is someone different who will transcend the standard political process. If it comes out that he is nothing more than the average cynical politician who will say anything to get elected, than that is gone entirely.

On that note, the Wall Street Journal today probably had the best line on this controversy:

Mr. Goolsbee maintains that he did say that Mr. Obama recognizes the benefits of free trade. But, Mr. Goolsbee adds, he also emphasized that Mr. Obama's objective is to strengthen Nafta's labor and environmental provisions. The accommodating Canadian Embassy nonetheless tried to smooth things over yesterday with a statement saying that "there was no intention to convey, in any way, that Senator Obama and his campaign team were taking a different position in public from views expressed in private, including about NAFTA." Which is too bad, because the apparent revelation that Mr. Obama doesn't believe his own trade rhetoric is the best news we've heard about the Illinois Senator's economic policy.

She Must Not Have Picked Up Much at the White House

Hillary is claiming that she is one of the foreign policy elite, you would think she would be able to pronounce, Medvedev.

Wesley Clark: Then and Now

I have never liked Wesley Clark, now I like him even less. This is the guy who ran for president, entirely on his military record, and now he is saying that McCain, who in addition to being a genuine war hero has a distinguished 20 year record in the Senate, is not as qualified as a housewife to be president:

In the national security business, the question is, do you have — when you have served in uniform, do you really have the relevant experience for making the decisions at the top that have to be made? Everybody admires John McCain's service as a fighter pilot, his courage as a prisoner of war. There's no issue there. He's a great man and an honorable man. But having served as a fighter pilot — and I know my experience as a company commander in Vietnam — that doesn’t prepare you to be commander-in-chief in terms of dealing with the national strategic issues that are involved. It may give you a feeling for what the troops are going through in the process, but it doesn't give you the experience first hand of the national strategic issues.

If you look at what Hillary Clinton has done during her time as the First Lady of the United States, her travel to 80 countries, her representing the U.S. abroad, plus her years in the Senate, I think she's the most experienced and capable person in the race, not only for representing am abroad, but for dealing with the tough issues of
national security.

What did Clark have to say about the importance of military experience in 2004 though?

Clark, a retired Army general, paid tribute to Kerry's military service in the Vietnam War and said he would do everything he could to help the senator from Massachusetts win the Democratic presidential nomination and then the White House.

"Sir, request permission to come aboard; the Army's here," a smiling Clark told Kerry, a decorated former Navy officer.

Keep in mind that Kerry spent less than 4 months in Vietnam, and weaseled his way out at the earliest opportunity, McCain spent nearly 6 years, and turned down an offer for early release out of principle. Hat tip to Hot Air.

My New Toy

OK, I don't normally blog about my personal life, I consider people who post about every stupid little thing they do hopelessly self absorbed. But she is so pretty...

Now if I could only learn to play halfway decent.

What is With Huck?

This is pretty funny, but he is becoming a parody of himself.

Hillary Will Smear Anyone to Get Elected

Even her own daughter.

ABC News' Jennifer Parker and Eloise Harper Report: Sen. Hillary Clinton took a swipe at her daughter's profession today at an economic roundtable discussion at a restaurant in Parma, Ohio, suggesting wealthy investment bankers and hedge fund managers on Wall Street aren't doing real 'work.'

The former first lady's daughter, Chelsea Clinton, works for New York-based hedge fund Avenue Capital Group. She previously worked in New York for McKinsey & Company, her first job after graduating with her master's degree from Oxford University.

"We also have to reward work more," Clinton told a small group of Ohio residents today. "and by that, I mean, I have people in New York working on Wall Street as investment managers, as hedge fund executives. Under the tax code, they can pay a lower percentage of their income in taxes on $50 million dollars, than a teacher, or a nurse, or a truck driver in Parma pays on $50,000. That's very discouraging to people."

UW Professor on Land Use and Costs

Unfortunately I never had him for economics my my days at the U, but this is an interesting study.

Backed by studies showing that middle-class Seattle residents can no longer afford the city's middle-class homes, consensus is growing that prices are too darned high. But why are they so high?

An intriguing new analysis by a University of Washington economics professor argues that home prices have, perhaps inadvertently, been driven up $200,000 by good intentions.

Between 1989 and 2006, the median inflation-adjusted price of a Seattle house rose from $221,000 to $447,800. Fully $200,000 of that increase was the result of land-use regulations, says Theo Eicher — twice the financial impact that regulation has had on other major U.S. cities.

"In a nationwide study, it can be shown that Seattle is one of the most regulated cities and a city whose housing prices are profoundly

What Science Does Huck Believe In?

Mike Huckabee, the part-time Baptist preacher, and now permanent presidential candidate once famously stated that he didn't believe in evolution. Well, with John McCain out to an insurmountable lead, and Huck still refusing to give in, apparently he doesn't believe in math either.

The sad thing is he appears to be proud of his ignorance, as he said a couple of weeks ago, even before things got worse:

"I didn't major in math," the former Arkansas governor told a cheering crowd at the Conservative Political Action Conference. "I majored in miracles, and I still believe in them."

Is this the guy we want looking out over a $3 trillion budget? Well, that is a rhetorical question, since he has no chance in hell (having majored in miracles, he should know what that is) of winning.

Hillary Moves to Lake Wobegone

Where all the children are above average... or in this case, nobody is in the lower economic bracket.

My measure of economic success will never be a single, dry statistic. Rather, success means an economy that allows those at the bottom to work their way into the middle class, without pushing anyone out.

Hello Democratic Party, Welcome to 1991

It is rather amusing to see the Democrats realize what everyone else knew nearly two decades ago. From the WSJ:

It's going to be fascinating to see if Democrats and the press let the Clintons get away with this. Imagine if Mitt Romney had made the Jesse Jackson comparison. Democrats would have immediately denounced the remarks as "racist," or as a part of some Republican "Southern strategy."

This primary contest has been a rolling revelation for many Democrats and the media, as they've been shocked to see the Clinton brand of divisive politics played against one of their own. Liberal columnists who long idolized the Clintons are even writing more-in-sorrow-than-anger pieces asking how Bill and Hillary could descend to such deceptive tactics. Allow us to answer that lament this way: Our readers aren't surprised.

More Mortgage Crisis Fallout?

The issue of economics in on-line games is a rather interesting one. One economist even produced a paper on the economy of Everquest. I don't have the time to play anymore, but I have dabbled in some on-line role playing games, but I can't see how anyone would invest real money in virtual banks. A rather interesting article on this was in the Wall Street Journal this week.

In the real world, banks are reeling from the subprime-mortgage mess. In the online game Second Life, a shutdown of the make-believe banking system is causing real-life havoc for thousands of people.

At BCX Bank, a sign said it was "not currently accepting deposits or paying interest."Yesterday, the San Francisco company that runs the popular fantasy game pulled the plug on about a dozen pretend financial institutions that were funded with actual money from some of the 12 million registered users of Second Life. Linden Lab said the move was triggered by complaints that some of the virtual banks had reneged on promises to pay high returns on customer deposits.

Second Life is an elaborate online world where players create new identities for themselves -- images called avatars. These avatars can own land, run businesses and build homes. And there's a link to the real economy: To buy things, players use credit cards or eBay Inc.'s alternative payment service PayPal to convert actual U.S. currency into "Linden dollars," which can be deposited using pretend ATMs into Second Life's virtual banks.

The banks of Second Life were operated by other players, who enticed deposits by offering interest rates. While some banks paid interest as promised, others used depositors' money for unsuccessful Second Life land and gambling deals. Under its new banking rules, Second Life says only chartered banks will be allowed -- though it isn't clear any real chartered banks will operate in the virtual play world.

One Confused Congresswoman

A bit of humor for finance geeks, a rather confused congresswoman, Marcy Kaptur (D-OH) confuses Ben Barnanke with Hank Paulson. Well, they both are bald...

Stolen Valor

The NY Times tries to smear US soldiers by implying that they are murdering in large numbers, Ralph Peters rightfully rips them a new one.

THE New York Times is trashing our troops again. With no new "atrocities" to report from Iraq for many a month, the limping Gray Lady turned to the home front. Front and center, above the fold, on the front page of Sunday's Times, the week's feature story sought to convince Americans that combat experiences in Iraq and Afghanistan are turning troops into murderers when they come home.

Heart-wringing tales of madness and murder not only made the front page, but filled two entire centerfold pages and spilled onto a fourth. The Times did
get one basic fact right: Returning vets committed or are charged with 121 murders in the United States since our current wars began.

Had the Times' "journalists" and editors bothered to put those figures in context - which they carefully avoided doing - they would've found that the murder rate that leaves them so aghast means that our vets are five times less likely to commit a murder than their demographic peers.

McCain in Michigan

I have not been following the presidential campaing too closely, but especially on the Republican side it is getting interesting. I am rather amused how the media jumps from candidate to candidate declaring them the new frontrunner. Many have accused McCain of being some sort of media darling, with some legitimacy admittedly, but now Romney is in the limelight with much being made of him victory in Michigan. Hell, it is his homestate. The polls even show how much of a factor this was:

Forty-one percent of people who voted in the GOP primary said Romney's Michigan ties were important to them, according to exit polls.

Only 39% actually voted for Romney, so apparently even some of those who thought it was important still did not vote for him.

In the bad news column, Thompson and Giuliani came in at a scant 4 and % respectively, below even fringe candidate Ron Paul. Stick a fork in them.

Looking Quite Spry for a Dead Guy

Despite Christopher Story's insane rants that he had been assassinated, Hank Paulson still managed to give a rather pessimistic speech on the economy today.

Treasury Secretary Hank Paulson also predicted slower growth in a speech on Monday and said that there was no simple solution to the US housing market crisis.

The Bush administration is considering an economic stimulus package that could include tax cuts to prevent the economy from falling into a recession.

Mr Paulson said no decision had been made.

"The administration is focused on what steps might be taken to further strengthen the economy," Mr Paulson said.

Odds that the Leo Wanta nuts will realize how stupid they have been for the last couple of years, zero.

Mr. Krugman Meet Mr. Ricardo

I have mentioned before how Princeton economist Paul Krugman did some respectable work in international trade before he gave up economics entirely and became a pundit for the New York Times. His latest rants pretty much sum this up. I recently purchased the volumnious collection The Real Price of Everything: Rediscovering the Six Classics of Economics edited by Moneyball and Liar's Poker author (and London School of Economics graduate) Michael Lewis. Weighing in at nearly 1500 pages, I have not read it yet, in fact upon seeing it my wife looked at me and asked, "You don't seriously intend to read that, do you?"

In any case the collection of economic classics includes Principles of Political Economy and Taxation by David Ricardo, in which the concept of comparative advantage was first introduced. Apparently Mr. Krugman has forgotten this concept and thrown 200 years of economic thought out the window, because it makes it easier to bash Republicans.

But for American workers the story is much less positive. In fact, it’s hard to avoid the conclusion that growing U.S. trade with third world countries reduces the real wages of many and perhaps most workers in this country. And that reality makes the politics of trade very difficult.

What basic economic concepts will he throw out next? Supply and demand? GDP = C + I + G + (X-M) ?

Why I Hate John Edwards

Although I lean toward McCain, I haven't decided who to support in the presidential race. One thing is clear though, I can't stand John Edwards. His editorial in this morning's Wall Street Journal on "reining in corporations" only reinforces this. He starts on CEO salaries:

In 1960, the average CEO made 41 times what the average worker made. But in 2005, the average CEO made over 400 times the average worker's salary. The share of corporate profits going to CEO pay has doubled since the 1990s. Meanwhile, the value of the minimum wage has plummeted 30% since 1979.

Oh, this is really rich coming from a trial lawyer who is worth more than $50 million from suing doctors for bogus reasons. This is even more hypocritical when you consider that Edwards recently made a base salary of $480,000 in one year for a part-time gig as a consultant for a hedge fund based in the Cayman Islands, more than many CEOs make for a full-time job. Do as I say, not as I do.

Edwards continues later:

As president, I will create a new universal retirement account requiring every business to automatically enroll its workers in at least one plan: a traditional pension, a 401(k) or an IRA. Workers will be able to choose to have their contributions deducted automatically from their paychecks, and they will be able to carry these accounts with them from job to job.

Hello, there already is a universal retirement account that workers can take from job to job, you even mention in this paragraph, it is called a 401(k). The only thing you have changed is making it mandatory for workers to enroll, something many companies do anyway. Leave it up to someone like Edwards to think that it is governments role to micromanage how companies compensate their employees, while he is resting in luxury in his 30,000 square foot mansion in North Carolina

Christopher Story's Violent Fantasies

OK, making up myths about missing trillions is one thing, but fantasizing that they have been shot is just creepy. How long before this idiot goes John Hinckley on us?

U.S. TREASURY SECRETARY PAULSON SHOT IN THE CHEST AT CLOSE RANGE

On or around Friday 28th December 2007, Henry M. Paulson Jr., Secretary of the US Treasury, was shot at close range in the chest. He was reported to be in a critical condition on New Year’s Eve, and was thought unlikely to make it overnight. At about 7.00pm UK time on 1st January 2008, Henry Paulson was still alive, with the bullet lodged in his chest. Sources stated that he was too weak to be operated upon, which implied that he was thought unlikely to survive.

The US Treasury Department’s Public Engagements Schedule, published on the official Treasury website by the Press Department, stated: ‘No events Currently Scheduled from December 22 – January 4’.

CLOSE AIDE OF VICE PRESIDENT CHENEY SHOT DEAD POINT BLANK

On Saturday 29th December 2007, a close aide of Vice President Richard Cheney, in his mid-40s, was shot at close range in the chest, and died.

ACTUAL NUMBER OF U.S. HIT LIST TARGETS IS KNOWN

A list of 127 senior people in the United States alone who have been targeted for assassination, is reported by reliable sources to exist.

Update: Paulson must be made of sturdy stuff indeed, because he is already scheduled to be back on the lecture circuit:

Treasury Secretary Paulson to Deliver Speech on Capital Markets and Economy
Washington, DC -- Treasury Secretary Henry M. Paulson, Jr. will deliver a speech on Monday in New York City at an event hosted by the New York Society of Security Analysts. He will discuss the recent developments in the capital markets and their impact on the economy.
What: Speech on Capital Markets and the Economy
When: 2:00 p.m. (EST) Monday, January 7
Where: New York City - Location TBA
Note: Media interested in attending should RSVP to press@nyssa.org.