Interesting observation EHP, my WAG is we are looking at a Bill White/Kay Bailey-Hutchison bout...of course that is subject to change without notice but those seem to be the primary contendesr ATM...

Bill White is the current (D) mayor of Houston.

Nevada relies on the tax on casino gaming, which is down 19%.

That oil cushion is about $200bn per year savings, assuming the same amount of driving is done

We had more than $200bn of home equity extraction per quarter as part of a much larger growth in debt

The USD is 30% above where it was in summer 2008 just before financial crisis money flows overwhelmed real trade. It should be able to remain elevated through the summer and into Fall 09.

So soon there will be the worst of all worlds during the adjustment phase, with the exception being the high dollar is killing a lot of exports right now for which there is still demand

calmo, re: HEW / $200bn per quarter at peak
US Federal Reserve data, I was first enlightened by CR. So you can trust both of us on it
Calculated Risk: Q2 2008: Mortgage Equity Withdrawal Plunges to Near Zero

I could have brought up the more ethereal effect of declining house prices. John Hermann pegged that alone to counter the $200bn in oil savings.

As for USD, Setser... That is my view, have not seen it reproduced myself. I expect the former current account surplus giants to continue remitting a large part of their surplus back as credit or spending. However without credit growth this technically, or once they realize this is not a simple matter of drawing down inventories, cannot continue indefinitely. Meanwhile, other countries have their own difficulties and there is legitimate reasoning to move into USD in the near term. However Setser is grasping at straws, he does not know why the USD is elevated. He hopes that it remains the ultimate safe haven. The main reason is the dominant role in financial markets the US played prior to the crisis. If a foreign deal was being done, with multiple currencies involved, in one way or another the USD was used as an intermediary to be the glue holding the packaged product together.

The USD has little to do with Obama or any other American politician. The wheels in motion are larger than the US government. Rogoff's paper surveying previous financial crises has the increase in government debt averaged at 86% although for the current crisis this is optimistic for many countries hit. Look at it this way, $8 trillion of debt will be added in the next 5 to 10 years no matter who is in office, pursuing any policy other than defaulting.

Dollar is strong because every other major currency is more fucked up than ours. Europeans cant get their act together and have E Europe problem (just think how bad all those Euro based loans in poland would be if they were $ based rather than Euro based though). Yen also rel strong, but just how fast are they sinking into the Pacific. Yuan, has a rel good economy behind it but is not really an Int'l currency, and China is going out of its way to keep it weak. The pound, the U.K. is simply a bigger version of Iceland, with better old buildings and rock artists. Switzerland an Alpine version of Iceland What the heck is left? The Real? the Ruppee? The Ruble (rubble)? The peso?

Garph. I like it.

A new word, to accompany glod and silber.

It has this nice barphing connotation.

The World According to Garph

Kudlow/Newt - Can the GOP really be this close to the bottom of the barrel?

Yes... close to bottom. Bottom is Kudlow/Limbaugh.

But there's a significant change of an uproar because the oil price has fallen. At current oil prices Middle East states are on the financial precipice, and social unrest often follows.

"At current oil prices Middle East states are on the financial precipice, and social unrest often follows."

The Russians aren't happy, Chavez is cutting back on buying friends, and the Norwegians took a big hit to their sovereign wealth fund by buying funny bankster paper.
The whole world is full of irritated, unhappy folks.

Shouldn't the free market mean you pay for what you use?

If the commons are free to exploit, then rationally I should dump toxic waste into your nearest body of water.

However if they are not free to exploit, then attaching a price to their exploitation will rationally encourage the best use of the commons to be made. I presume Rob Dawg would prefer having the freedom to choose from a fleet of cars that manufacturers developed in response to natural incentives, rather than the existing loophole-based fleet-wide-average-efficiency.

By simplifying the matter, it becomes a more efficient and less distorted market than existed under anarchic conditions.

Every cost is punitive to someone in the strict sense. If we were to argue what constitutes punitive wrt to a tax you would pay, then it would be an argument of emotion so there's no point. I don't know where Obama's proposed prices will be set, but I doubt they will be high. The 2 groups that will feel a carbon tax the most will be large industrial companies that never planned for such an idea, and non-federal governments because they would not be benefiting from any offsetting tax cuts. Call me crazy, but as a simple consumer I find gas expenditures to be very small when you add it up over a month or a year. The only problem is people have a memory of paying even less, and they already had their budgets so tight that dropping a $20 bill would have forced them to cut spending to make it to the end of the month.

As for roads though, wish I still had a copy of whatever report it was, but US Federal gas tax revenues has not covered the cost of interstate upkeep since the 1960s. I brought it up another time, but going forward user fees will be a prime target to raise revenues for governments (as revenues from taxation and borrowing shrink)

I said gas tax, and federal interstates. I did not include fees from private toll roads that generate a profit.

furthermore, 92% coverage... who pays the other 8%?... ah yes, thanks for making my point

there's also that $2tn deficit in road infrastructure, mostly with bridges designed to last <50 yrs that need to be replaced all at once. When I count the cost of a road I amortize the capital investment over the lifetime without assuming a fairy built it before I came around

I'm taking off right now, but I'll try to pull up DOT FHA expenditures vs xx¢/gallon X gallons consumed (assuming those exempt from that tax are negligible to your contention's benefit)

It's a good thing we have progressives in control now.

That's true. The last 8 years were absolutely horrific.

Now would be a good time to raise gas taxes and cut payroll taxes. We were starting to get serious about energy conservation and efficency last summer, but now nobody cares anymore. Sales of feul efficent vehicles are down just about as much as of gas guzzlers. peak oil is being masked by peak (at least temp) demand.

Price of oil is higher than it should be right now under a market price... too many people using it to bet on immediate inflation as if they don't realize we are amidst a stream of deflation

That being said OPEC and non-OPEC cuts are following through. There's a big amount of days of inventory right now which will slowly wean off, but by the time demand increases for Spring next year the oil market is set up to be tight again (without being restrictive). However before the oil market can manage itself, expect to see the financial products side of the biz to take the pricing reins first... it's one of the more efficient ways after agriculture to milk China et al until they break their peg

Now would be a good time to raise gas taxes and cut payroll taxes.

I certainly agree, but will Congress actually make this happen?

Too late. That evil previous administration is way ahead of you.
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Now would be a good time to raise gas taxes and cut payroll taxes.

The gas tax needs to be raised. I've calculated that 12¢ is necessary to cover the four growing tentacles dipping in the pot. Repair money for deferred upkeep, mission creep to cover things like sound walls and wildlife corridors, unmet basal demand, and transit cost explosions. Unfortunately there is absolutely no hope whatsoever that the money will go where it is either needed or will do the most good.

In the meantime I continue to be entertained by the "Black Knights of Peak Oil" losing another limb to stand on and calling it "but a flesh wound."

Just because the peakenese think oil comes from magical fairies doesn't make it so.

"In the meantime I continue to be entertained by the "Black Knights of Peak Oil" losing another limb to stand on and calling it "but a flesh wound.""

It is my firm belief, that long before we get to a recovery, we will see 140$ oil.

"IMO there can be no recovery with $140 oil. We just saw that proven."

No, we saw that 140$ oil can collapse the double bubble of a pyrimid scheme in housing and the impending T-Bill pop.

In a real economy 140$ oil will be VERY real.

"The housing bubble was collapsing long before the oil price jump. Try again."

OK. How about Oil would still be at 140$ if not for the housing collapse?

The oil savings, such as it is at the moment, is not necessarily reflected in savings on utility costs. Rate setters for public utilities seem to convene about once a year. To the degree rates are based on the previous year's cost of fuel, they are probably still too high given the drop in oil.

People don't like to give up what they feel entitled too, mostly because they know of Mr & Mrs X who get Y benefits. Applies to pensions, applies to wages. It's why Thain's office redecoration was completely normal within his social sphere. It's why migrant workers will sleep 8 to a room in order to pick lettuce.

However, unlike most recessions we are seeing voluntary wage roll backs this time around. People aren't inclined towards it, but they will take a lower price than what they earned in previous years for the same work.

It will happen to pensions eventually. Pensioners might win a round or two of public debate of course, but it will become apparent that only a lower level is affordable while the alternative is no one gets anything.

I expect actuaries will make the debate harder by lagging in keeping their predictions for 8%+ returns annually. There is still the unjustified hope out of selfishness that things turn on a dime out there

I've been on "calf-watch" and "honey-do list" duty for the past couple days - and not able to lounge around the 'puter.

What's with our tax dollars (thru AIG) going to foreign banks??

AIG counterparties to credit default swaps revealed - Mar. 7, 2009

BSR,
if you see Werner, tell him the Germans, especially Deutsche bank, are scalping the American taxpayer...should make him happy.

What biases are you seeing in my mind?

If you can see into my mind as claimed you already know the answer to that question. Fact is you cannot see in my mind and pick out these biases. It was nothing but a cheap shot to suggest as much. Keep it to the facts and what people are saying not what you think they think or as we saw above what they was written.

Yeah, that's what I thought you'd say.

I like cheap gas, but I'm worried. Projects that were viable when gas was high (oil sands) have been mothballed. When demand goes back up again, production capacity in an industry that was already in decline will be in the pooper, meaning sky high prices.

PS I love The Oil Drum | Discussions about Energy and Our Future The articles are great (shout out to my homey Westexas!) but unfortunately their comment section has an even higher number of resident moonbats than CR, and that is saying something.

?Mineta said these large SUVs will be included in the CAFE program starting in 2011,. . .

More than one reason why Lincoln is only making 600 extended length Navigators this year. Probably won't be any by model year 2011.

another issue with the oil spike is that it flowed through to consumer goods e.g. food. The impact of higher prices for the consumer lags but more importantly once the increases go through manufacturers are slow to offer any reductions and it is almost a sure thing that prices will not return to pre spike levels. So while the consumer may be saving at the pump their trip to the grocery store has gotten much more expensive than before the spike.

Why am I not laughing.

I am all for jacking up the gas tax to reduce US dependence on foreign oil and reduce the trade deficit, but only when there is a line of sight to viable alternatives.

What biases are you seeing in my mind?

The ones that always assume tax increases will be punitive rather than justified.

It is in large part the lack of realistic taxation that has contributed to the current economic problems.

Gas taxes will never be punitive if they result in lower consumption of imported oil, which almost by definition they do.

Dash,
American political system is deeply corrupt. That's the short answer.

there continues to be optimism out here"

Where is here?

If Russia and Iran do come together so that Russia markets Iranian natural gas, what are the geopolitical consequences? Perhaps momentous?

Most pressing is the situation in Pakistan not the Mid East.

Why? They want to stop selling oil to the US as well?

Top U.S., European Banks Got $50 Billion in AIG Aid
Top U.S., European Banks Got $50 Billion in AIG Aid - WSJ.com 

Covered Counterparties

Some banks that were paid by AIG after it was bailed out by the government

* Goldman Sachs
* Deutsche Bank
* Merrill Lynch
* Société Générale
* Calyon
* Barclays
* Rabobank
* Danske
* HSBC
* Royal Bank of Scotland
* Banco Santander
* Morgan Stanley
* Wachovia
* Bank of America
* Lloyds Banking Group

Source: WSJ research

"It is in large part the lack of realistic taxation that has contributed to the current economic problems."

WHAT? Now I've heard it all. Even in the old days of hallucinogens could I not get to THAT point of view, Sportsfan!

Heh, so they're the peakenese now?

It's just one more term used by small minded people to dehumanize those who do not agree with them.

saw yesterday from Joanna's agweb link that the US cattle population is set for a major reduction in force unless more calves are carried ASAP

I guess consequences of high feed cost

Do the The Market Crash!

YouTube - Monster Crash

If you can see into my mind . . . .

Rob Dawg, I've been reading your doctrinaire Republican comments for a couple years now. You're biases are well documented. You, and people like you, were big supporters of everything that went wrong over the past 8 years and, worst of all, did it all out of personal greed.

You belittle and mock everyone who doesn't subscribe to your world view.

There are commenters on this board who agree with your positions, but rarely disply your level of arrogance in the Righteousness of what you believe. You are, in a phrase, a pompous ass.

No, I see into your mind . . . no do I have any desire to do so.

It's not global warming but a change in cycles! I think global warming has been disproved.

I stumbled onto this :
Financial Sense Newshour 
Check out Other Voices: Evelyn Browning

Home

Am not so inclined to believe in global warming and it's causes. Rather a change in the cycles but yes will wait for conclusive proof.

burnside,
Thanks for the information.

I just need another $100 million in research funding to prove, disprove or justify further funding before I can honestly answer that question.

Been there done that.

"tell him the Germans, especially Deutsche bank, are scalping the American taxpayer.."

I'm sure he's having a fine weekend realizing this, AND, I'm sure he'll be proud to point it out on Monday as well.

Take care and don't let the Dawg bother you too much.

"let's just cut taxes, start wars, and run up some deficits, why don't we"

Well, I'm an old guy - nothing much riles me up anymore.

What I DO KNOW though, is if you give the FedGov more money in taxes, they will spend north of 10% more than you give them - and STILL "NEED" MORE.

As far as wars go, I've been to one, and it seems that the people that have never been, are the ones who start them.

As far as deficits go, it seems both sides of the aisle are guilty of spending our money - THIS administration will have the record of all time, and seriously it doesn't matter anymore. Our house is burning and their's no one around that knows how to put out the fire. I'm just thankful the good Lord has blessed me and my family with our own paid for hut, garden & critters out here in the desert - away from the idiots and jackals.

The system is inherently broken. You can't fix an entity that has a built in positive feed back loop that is fed by the what makes it exist.

Good read on the global impact.

Common Sense Forecaster

Give it a read

"let's just cut taxes, start wars, and run up some deficits"

That seems to be the new plan, all right.
$5 trillion so far, as near as I can tell.
I wonder what Month Three looks like.

Reducing a expense is not stimulus, be it energy or taxes.

Stimulus is an increase in revenue, not a decrease in expense.

Pro-business anti-consumer folks like to call it that, but it doesn't make it reality.

This is what 25K getting a pink slip daily looks like.