Jefferson's Wisdom

"The democracy will cease to exist when you take away from those who are willing to work and give to those who would not"
--Thomas Jefferson

America's Lost Decade?

Great article on The Wall Street Journal today (http://online.wsj.com/article/SB123007755316531663.html). It touches on the theme of FDR's Folly (a great book): government action made the Great Depression worse, not better. We are setting up to make many of the same mistakes again. Public spending on a massive scale, nationalization of big parts of the economy, public funds spent in uncompetitive industries with "Czars" assigned with no record of industry related experience performance to make sure the money is spent wisely (i.e., to further the political agenda of the Government), wasted money on infrastructure.
The title of the article refers to the lost decade in Japan after the real estate and equity bubble burst in 1989. The Japanese governement wasn't willing to let the economy take its medicine and kept many big companies and banks alive that should have been allowed to fail. They pumped shocking amounts of money into "infrastructure" to build roads and bridges to nowhere. I wonder how many more light rail projects we will have in this country as a result of our new new deal democrats $2trillion pubic spending?

'Tis Done

'Tis done. After a failure of historic proportions in George W. Bush, the country has punished the Borrow and Spend party by putting the Tax and Spend party in charge government. The good news is there will be a shrinking tax base even if they don't increase taxes so the short-term damage is limited. Of bigger concern are all of the people that will die before their time when the benefits of Universal Health Care really become apparent. Simply put, scientists and entrepreneurs will find other places for their talents. R&D money will not be spent and drugs and treatments won't get better at the rate they would have. There is one reason the US has the best health care in the world: the profit motive. I've lived in Japan (the second biggest economy and by some measures the richest country) and their health care doesn't come close to the US. Why? They have socialized medicine.

Regarding Economic Forecasts

No one! No one but God Himself can see more than 6 months out on factory or business orders. Simply doesn't happen. As a sales guy with existing customers I can really only see about 30 days with certainty. Sometimes customers will give a quarterly outlook. Beyond that a sales guy has to give his best guess. Generally a pretty good one but a guess none the less for about two quarters out. Beyond, it is a complete crapshoot. So, the guys in the governement (hearts in the right place) say it will be better in 6-9 months. What else can they say? "It will be aweful for the forseeable future"?!? No. That would almost certainly be a self fulfilling prophecy. So, they talk about the next quarter where no one has any idea what will happen in the most positive terms!

alternative energy? do the math

Dear Mr. L (aka Chicken Little)
The oil economy has a long life left in it. It has always been characterized by too little production capacity or two little refining&distribution. As it happens we now have both (as a result of both GREENs causing a crisis by stopping refineries being built and local exloration and production capacity being hampered by the same GREENs and second, no doubt our boneheaded president has helped by pushing the dollar lower and engaging in an unwinnable war). so, we have a bubble. I have now moved my small bet ($40K that was $25k when I bet it on Cummings as a play on highrer oil prices to airline stocks as a play on lower prices).

I agree oil won't last forever. And, we should be bulding nuclear (corn won't do it because it takes a gallon of oil to make a gallon of ethanol; wind won't ever do it --do the math; solar is VERY energy intensive+there is no more toxic industry than semiconductors). Nuclear is our only answer. Asside from COAL which i think is great becaseu we have lot.

Hydrogen, battrery, or hybrid cars simply move the problem from one energy prodcution source to another.


On Mon, Jun 16, 2008 at 10:32 AM,
Mr. L wrote:

Drop back from 200? or drop back from 130? The Fareed Zacharia article in Newsweek would argue neither. Now before you tell me not to listen to left wing rag like Newsweek, my right leaning friend, I generally do not. Check out the issue if you can. It has gas pumps on the cover spelling out "Recession". The article is co-written with Dave Gross and a dozen or so other economists, none of whom hold much faith in Paulson's claim that the second half of of the year will make up for the first. Really, at this point, Paulson seems more and more like an administration hack. A buffoon selling bad data for political goodwill.

You are betting the price of oil will retreat in the fall? By $5? Can Tom make money on price aberations? All the pressure is in the other direction as demand has not budged and the majors are pumping at capacity. There are no elephants left as matt damon's character says in the brilliant but underappresiated "Syriana." This is the final push and there is nothing pushing back.
----- Original Message -----
Sent: Sunday, June 15, 2008 4:36 PM
Subject: Re: can't reach you from my work address
Indeed. $200 is not out of the question. But, I do think after the summer we see it drop back quite a bit--I'm betting that way in the market.
On Mon, Jun 16, 2008 at 1:07 AM, Mr L wrote:
Fuck OPEC indeed. Way beyond the powere base Kissinger imagined when he created the petrodollar.
No matter what we do to increase supply, whether asking SA to pump more or drilling at home, we burn 25 million barrels a day and now have some new world competition for what's left. You have to be prepared to ask yourself the tough question,...is $200 the new $60?
----- Original Message -----

Sent: Saturday, June 14, 2008 8:48 PM
Subject: Re: can't reach you from my work address
On Sun, Jun 15, 2008 at 10:39 AM, Mr. L. wrote:
Wow, great rant.

I totally agree, we brought this on ourselves. It is mindless that we haven't built a refinery in 30 years, but in balance it is at least a bit disinguous to deny some complicity by the bigs who, had they desired to build refineries here, were certainly among the most sophisticated and well funded lobbying industries to grace the houses of Congress during that same 30 years, could have made some progress towards that end. If that is what they had wanted, would simple regulations for polution and land use have stopped them? These are the days they hoped would come.

YOU GOT THIS RIGHT. OF COURSE, IF THEY HAD WANTED IT THEY WOULD HAVE GOTTEN IT. BUT, AS A COUNTER, DON'T YOU THINK TEXAS PACIFIC GROUP WOULD LIKE TO BUILD COAL PLANTS BUT WAS STOPPED?

Remember also that American refinery shortage doesn't affect the world price of petroleum. Our world competitors for this dwindling and finite resource are at least mostly responsible right? Either way, the cheap dollar is more responsible than the shortage of American refineries. The only mainstream refinery derivative we are "frac"-tionally short on as a result is diesel, which, do you imagine they really wish they could sell for less?

AGREE. BUT, DIESEL IS A CASE WHERE REGULATION (NEW CLEAN STANDARDS AND CALIFORNIA REGULATIONS DIFFERENT THAN OTHER STATES) HAS FRACTURED OR FRAGMENTED THE SUPPLY CHAIN RESULTING IN LESS SUPPLY OF A GIVEN STANDARD DIESEL.

But yes, old friend, we did this to ourselves. Arrogance really. Even as recently as 4 years ago, Ted Kennedy led the charge to defeat a proposed wind farm off the coast of his Connecticut beach home. We definitely are facing the California style brown outs and worse over the next two decades. Response after crisis is always more expensive, and less well planned. We will make a real mess of that as well. This is not a crisis we can pump our way out of. If we had started drilling ANWAR ten years ago when it was first put on hold, we'd be conserving it by now too.


THE TROUBLE WITH OUR NATURAL RESOURCES IS THAT UNLIKE THE OPEC STATES 20 YEARS AGO OUR GOVT DOESN'T CHARGE DRILLERS AND MINERS BY THE UNIT EXTRACTED. WE SHOULD START THIS FOR ANWAR AND USE THE MONEY TO BUILD NUCLEAR POWER PLANTS. FUCK OPEC.

It aint spam if it's good stuff. Good stuff.

Weather Channel Founder outting Al Gore.

A key disclaimer for me: I like clean air. I like clean oceans. Less shit from people in both is good. I simply don't buy the win at all costs, end justifies the means approach from the tree huggers.



Weather Channel Founder outting Al Gore. Worth the read.....

http://www.kusi.com/weather/colemanscorner/19842304.html

But why no new refineries? The Greens, of course

From my Labor friend (CAPS MY RESPONSE TO HIM)

I totally agree, we brought this on ourselves. It is mindless that we haven't built a refinery in 30 years, but in balance it is at least a bit disinguous to deny some complicity by the bigs who, had they desired to build refineries here, were certainly among the most sophisticated and well funded lobbying industries to grace the houses of Congress during that same 30 years, could have made some progress towards that end. If that is what they had wanted, would simple regulations for polution and land use have stopped them? These are the days they hoped would come. YOU GOT THIS RIGHT. OF COURSE, IF THEY HAD WANTED IT THEY WOULD HAVE GOTTEN IT. BUT, AS A COUNTER, DON'T YOU THINK TEXAS PACIFIC GROUP WOULD LIKE TO BUILD COAL PLANTS BUT WAS STOPPED? Remember also that American refinery shortage doesn't affect the world price of petroleum. Our world competitors for this dwindling and finite resource are at least mostly responsible right? Either way, the cheap dollar is more responsible than the shortage of American refineries. The only mainstream refinery derivative we are "frac"-tionally short on as a result is diesel, which, do you imagine they really wish they could sell for less? AGREE. BUT, DIESEL IS A CASE WHERE REGULATION (NEW CLEAN STANDARDS AND CALIFORNIA REGULATIONS DIFFERENT THAN OTHER STATES) HAS FRACTURED OR FRAGMENTED THE SUPPLY CHAIN RESULTING IN LESS SUPPLY OF A GIVEN STANDARD DIESEL. But yes, old friend, we did this to ourselves. Arrogance really. Even as recently as 4 years ago, Ted Kennedy led the charge to defeat a proposed wind farm off the coast of his Connecticut beach home. We definitely are facing the California style brown outs and worse over the next two decades. Response after crisis is always more expensive, and less well planned. We will make a real mess of that as well. This is not a crisis we can pump our way out of. If we had started drilling ANWAR ten years ago when it was first put on hold, we'd be conserving it by now too. THE TROUBLE WITH OUR NATURAL RESOURCES IS THAT UNLIKE THE OPEC STATES 20 YEARS AGO OUR GOVT DOESN'T CHARGE DRILLERS AND MINERS BY THE UNIT EXTRACTED. WE SHOULD START THIS FOR ANWAR AND USE THE MONEY TO BUILD NUCLEAR POWER PLANTS. FUCK OPEC.

I was reading today a poll in the McPaper (USA Today) that says that more people blame US oil producers than OPEC for high oil prices. Wonder why USA Today didn't ask people whether they blame the Greens? The Greens don't hurt anybody. They have worked for this for years, they're gleeful with high energy prices. Makes windmills (16th century technology) more competitive.