My daughter is in summer school. Like her father, she is "math challenged." The school provides lunch for a fee. The problem is they are bringing it in from fast food places and charging for it. So lunch is going to cost her about $5.
Fine, she can bring one. What makes it interesting is that a lot of the kids in summer school were also the ones getting almost free lunches. They can't afford it and I guess there is nothing at home. So they don't eat.
My cooworker was telling me this morning about how theu converted the garage into a room for her Mom. Why? Because her sister and kids were homeless and Mom had a paid for house. Sis gets the house and Mom moves in with them.
The security guards as I came in were talking about how "its all about money" and how there is none out there.
I have been thinking. There is and was a lot of financial fat on the bones of America. Pretty soon we should be getting close to the bone for the first wave or two. Nothing left to sell. House gone. Cards gone. Job gone. Unemployment still coming in but the end is in sight.
nova -----Hope they include psychiatric benefits in the health care reform--many in your family will feel the need. --Or they could legalize pot--a cheaper option.
Didn't realize I had been pigged. Thought everyone was gone in the other tread for a minute, scrolled up and there was piggy. Anyway, repost
nova,
I think that financial edge of the cliff is getting closer for a lot of people. Wife and I were talking about all the heated domestic disputes we are seeing in public over 'money' issues. More correctly, spending money issues. Nerves are frayed, and tempers are short. Best ones are dads explaining to teenage daughters that cellphones aren't a necessity. Lots of families moving to pre-paid cells. Lots of teens unhappy.
July 7 (Bloomberg) -- A record 33.8 million people received food stamps in April, up 20 percent from a year earlier, as unemployment surged toward a 26-year high, government figures show. Spending also jumped, as the average benefit rose.
It was the fifth straight month of record participation in the Supplemental Nutrition Assistance Program, according to the U.S. Department of Agriculture, and up 1.8 percent from the prior month. Total spending was $4.5 billion, up 19 percent from the previous all-time high reached in March, the USDA said.
Jim asked on the prior thread "Is it selling to loan at no interest with cash back? When does a sale become a subsidized gift?"
This can actually be really profitable. A good example is a jewler near where I used to work. Like most jewelers, he had a high markup. He sold at just below retail with 50% down, and payments with credit-card type interest rates (15-25%). Sometimes, he would have a no interest for 12 months sale, and throw in some "free" stuff at the sale.
How could he do this? His cost was less than 50% of the sale price. He recovered his cost, but not his usual profit, as soon as a credit customer purchased. All of the subsequent payments on the loan were profit. The "free" stuff he tossed in didn't cost him much, and he still made a small profit even if they didn't make a single subsequent payment.
Oddly, he helped a lot of his customers establish credit, when no one else would give it to them (early 1990s, before breathing was the sole qualification for credits, RIP Fog A Mirror, Get a Loan, 2002-2007)
The Mrs two youngest would LITERALLY be devastated without a mobile phone. It would be like them dropping off the face of the world.
Nova....the school food program is a crime. Used to be the schools PREPARED lunches - not ordered in from junk food establishments. Not to mention, coke machines in school? You gotta be kidding. How about white milk and REAL juice - not the kind "made from real fruit flavors"!
Many more are feeling it - and worried. When our local Fox News channel (night before last) spent more time on the bad economy than Hollywood, I even was shocked.
With food stamps at record levels, longterm unemployment at record levels, underwater mortgages at record levels, I'm amazed that there is not much noise about the new bonus round for AIG employees.
The citizenry, or excuse me, the consumers, are surprisingly quiet.
I believe the period we are entering is in many ways be analogous to the Middle Ages in Europe. What happens when the King, because of bad policy decisions, becomes too weak to project his power throughout the kingdom? The other nobles become restive and begin to gather power onto themselves. What happens when these regional nobles (States) because of their own failures can no longer maintain the Kings peace for him?
This was inspired, partially by this post here.
Resistance is Feudal (Poster, Calculated Risk) wrote…
Once the integrity of the monetary system is breached in the general public mind, it gradually ceases to have significance or ability to regulate behavior in any way among even the “suckers” whose value systems made a middle-class possible. That, not the loss of economic status, but the progressive disintegration (through growing irrelevance and lack of political potency) of the middle-class value structure and beliefs, routs the socioeconomic distribution into rich and poor since there are no other choices left.
most of us here look for cause and effect and try to put our finger on the reasons-why for the financial crisis
MBS, CDS, ratings agencies bought by financiers, the poor buying mcmansions, low interest rates at the fed, a breakdown in regulation, no doc loans etc etc
but is there not a root cause the hides underneath?
the usa has been gutted by year after year of trade imballances that rivaled and sometimes almost equaling the federal deficit
we outsourced jobs, eliminated tariffs, asked american workers to compete with countries that subsidize their industries and facilitate export goals (forex manipulation) and in some cases use child and nearly slave wage labor w/o any human rights or environmental controls
we refused 21 century energy technology in favor of buying foreign oil
and all these dollars flowing abroad had to be "recycled"...what to do with the worlds supply of excess dollars//
we, the usa became the world leader in selling paper
we securitized and repackaged debt and re-allocated and mis-allocated our capital into financial services and corporate take-overs while our current account balance ("trade debt") pulled us underwater like an anchor
consider this ,30 years ago we owed the federal debt to ourselves...
us corps, institutions pension funds and individuals owned the vast majority of bonds and t bills and notes
today...we are owned by others and the root cause imho is imbalance of trade and the associated debt involved
I think consumers are too busy trying to figure out how to consume less and live. When people become depresssed, they get quiet. Most people don't know who to be angry at, it is a system failure. No direct target to aim at, it is all falling down.
I believe the period we are entering is in many ways be analogous to the Middle Ages in Europe
The Middle Ages will be a cake walk compared to where we are heading. They had a intact ecosystem, unexplored and virgin continents, oceans full of fish.
We live on a warming planet, raped and scraped with 6.7 billion people living off ancient sunlight.
In my small world I don't see anger. I see fear. I see people worrying about immediate needs, not far away people who screwed them but exist in another universe. It is when you realize, and accept that this is it - possibly forever, that I think you will see anger.
Them belly full but we hungry
A hungry mob is an angry mob
A rain a fall but the dirt it tough
A pot a cook but the food no 'nough
Cost of livin' gets so high
Rich and poor they start to cry
Now the weak must get strong
They say oh, what a tribulation
Them belly full but we hungry
A hungry mob is an angry mob
A rain a fall but the dirt it tough
A pot a cook but the food no 'nough
(as long as the corporate government keeps people fed, and entertained, mob action is unlikely...a roof over the head is also desirable...im not a fan of mob action, very scary and unpredictable stuff)
Wiki on Tainter:
"We often assume that the collapse of the Roman Empire was a catastrophe for everyone involved. Tainter points out that it can be seen as a very rational preference of individuals at the time, many of whom were actually better off (all but the elite, presumably). Archeological evidence from human bones indicates that average nutrition actually improved after the collapse in many parts of the former Roman Empire. Average individuals may have benefited because they no longer had to invest in the burdensome complexity of empire."
I see fear at the local level... but on the small private business owner level...there is growing anger. And these people are talking at the golf course and the country clubs and the business associations. I am not talking about Republican born again tea parties here, I am talking about real business owners who are seeing their way of life destroyed by a corporate gang rape facilitated by the banking industry. These people won't go down without some kind of fight. Shooting the captain of a sinking ship is a little bit counter-productive though.
China’s exports dropped 21.4 percent in June year-on-year, but did rise 7.5 percent month-on-month, Xinhua reported July 10, citing customs data. Imports in June dropped 13.2 percent year-on-year, after a 25.2 percent fall in May."
Lobbyist Ben Dover (profile) wrote on Fri, 7/10/2009 - 10:38 am
Free School lunch programs are another way to free up money for abusive parents to buy crap. This is not help but enabling."
Do you honestly think those type of parents don't buy crap instead of buying food for their kids? For many kids, school lunch programs are the only sure meals of the day.
Most people are pretty brainwashed: a good part of the "middle-class values" include trusting the system and the banks.
That's hard to shake even when "homeownership" was proven NOT to be "your family's largest / best investment" and the banks have captured the government.
You can't really say these in public:
* America produces about 3x the number of "home grown" engineers that we need: the only reason for the vast majority of H1-B visas is to lower the wages of the middle-class
Tolerance of mass illegal immigration is war on the working class (Mexico's unemployment rate is about half the US rate / illegal immigrants consume more public services than their low wages contribute)
Your congressperson is owned by banks, especially Goldman Sachs: contacting him/her is a waste of time
Since college tuition has risen so much faster than inflation, borrowing to finance a degree at a non-elite college will result in a lifetime of debt sevice; however, it is very difficult to finance a middle-class lifestyle without a masters' degree.
"mock turtle (profile) wrote on Fri, 7/10/2009 - 10:28 am
...but is there not a root cause the hides underneath?
the usa has been gutted ...
today...we are owned by others"
Combine this with the postings by otishertz several threads ago about corporate colonialism, of which my summary is that the internationalists have defeated the nationalists, and it adds up to a mental model that works for me: it is as though we've been conquered.
The ONLY way I can see out of this is to redirect our efforts to within. Forget global notions for now. Start with remanufacturing the basics again. Start making high-quality basic products again within the US. They will cost a bit more, but by the fact you're not replacing them every year with another "throw-away" from China, is proven to be cost effective. Throw tariffs on everything imported for a period of time - screw non-US made products for now. We have 200-million of the best damned customers and workers in the world. Put them back to work, putting out the best products ever made (like it used to be until very recently). Other countries will buy American again - If not, it doesn't matter - we'll provide for ourselves - nobody else is going to!
My wife survived childhood because of the school lunch program. A child of wonderful California parents (mom married six times plus many boyfriends, doesn't know who her dad is to this day) The assorted birds, snakes, and other exotic pets ate better than she did at home. Without the school lunch (by the way she worked in the school cafeteria during lunch hours because she felt guilty for the free food) she would have starved. As it was, the cafeteria staff took care of her, and fed her from the staff food, which was better than the normal stuff they gave the kids. I agree it is more enabling....but what do you do when a whole system breaks down. The judge knew her family was being abused. She testified to the fact, and the system never did anything.
Playing devils advocate, while I feel fairly negative over the next few years, I am wondering if we won't see a mini-rally over the next 30 days in the tech based stock market. The reason being, all the tech companies gave very conservative guidance for their June quarter and it looks like most of them will meet or beat their guidance. (Notice how few negative pre-announcements we have had since the beginning of July.) Any thoughts?
Suggest you read David Rosenberg daily and incorporate some of his wisdom into your thinking. This is not a typical post-War recession. Many Indices can no longer be read the same way. Unemployment is not a lagging indicator. Consumer demand is absolutely key which suggests that consumer sentiment is much more important than it used to be.
As an aside, one can look at Rasmussen's consumer index to get a indication of which way the Mich. and CB numbers will go. Also the ABC Consumer Comfort Index has been much less volatile that Mich or CB and, IMHO, is a better index at this point in time despite it's somewhat shorter history.
The sentiment I'm seeing is "here we go again." The people have been poor for so long, they have developed all kinds of coping skills-- not all of them healthy. There is more resignation and fatalism than anger--a certain detached depression. OTOH that's Oregon at the best of times.
Well, to a point more stuff DOES mean a better life. I hate McMansions and my car is about a dozen years old now, and I do value libraries, parks, and nature, but it was nice to finally get my own apartment after being in the workforce for so long.
One of the big lies is that all Americans are SO SPOILED. Sorry, but the Bushes aren't typical. A lot of us (I am on the Gen X/ Gen Y border: in college during the .com boom, started working right around 9/11, and now this) are really just looking for moderate middle-class lifestyle.
Keep in mind that the median HOUSEHOLD income is about $50k. With the cost of education and healthcare and (until recently) real estate, that doesn't go all that far.
Lobbyist Ben Dover wrote on Fri, 7/10/2009 - 7:38 a
Free School lunch programs are another way to free up money for abusive parents to buy crap. This is not help but enabling.
do you speak from a personal knowledge about poor kids who get subsidized meals or free meals at school
i worked as a volunteer in our local school for 11 years (while i worked a full time job not related to public education
i saw first hand kids from families where the parents each worked near minimum wage jobs and many of their kids needed the good meal that the taxpayers graciously provided . btw we passed our local levy with a vote by the people (by a supermajority of 60%) every two years
you should not be so hard on kids...they didnt do this
One of the stranger ones is that people seem to think that more stuff means a better life.
I believe Bob the-angry flower summed up that mindset -> http://angryflower.com/inflat.gif
More things does not mean a better life... NICER things mean a better life
"scone (profile) wrote on Fri, 7/10/2009 - 10:53 am
There is more resignation and fatalism than anger--a certain detached depression. "
"Resignation and fatalism"- that doesn't sound stereotypically "American", does it? But it fits the speculation that the reaction will be passive-aggressive. That doesn't sound "American" either.
Our spirit has been crushed.
NateTG (profile) wrote (in reply to...) on Fri, 7/10/2009 - 9:45 am
"Most people are pretty brainwashed..."
One of the stranger ones is that people seem to think that more stuff means a better life.
Maximal consumption = maximal happiness. Millions of morbidly obese Americans with severe health problems before they even reach middle age can't be wrong. The happiness practically bubbles out of them!
The evidence of the 'wisdom' of our economic mainstream is staring us right in the face.
On a positive note, look at that trade deficit...we're within shouting distance of zero. If crude drops another $10 a barrel and we increase our savings rate a bit more, perhaps we could hit zero fairly soon.
My employer uses electric forklifts instead of propane ones. We just plug them into a charger at night. Good stuff.
Newbie 101 (profile) wrote on Fri, 7/10/2009 - 7:59 am
"scone (profile) wrote on Fri, 7/10/2009 - 10:53 am
There is more resignation and fatalism than anger--a certain detached depression. "
"Resignation and fatalism"- that doesn't sound stereotypically "American", does it? But it fits the speculation that the reaction will be passive-aggressive. That doesn't sound "American" either.
Our spirit has been crushed.
There's alternative explanations.
• Keeping one's powder dry.
• Staying off the radar.
• Declining consent of the governed.
• Front running with necessary discretion.
Don't mistake the shift away from complaining as being due to resignation.
The security guards as I came in were talking about how "its all about money" and how there is none out there
That is the point I was making to mp a few months ago when he was talking about stabilization. People/small businesses were hanging on by their fingernails and unless we had demonstrable improvement in a few months then we were going to see a downleg. No longterm flatline until recovery. Either moonshot recovery or another step down towards the bottom.
I was pessimistic then. Now I'm certain of a downleg.
I know everyone wants to focus on how fat we are (and I am one of them, gluttony is a sin I know well) but I still hold the best thing for America would be a mandatory time out for everyone over 12. We all need to be put in solitary for a day. No outside stimulation, no communication, so we can hear that small voice inside of us again. Too many people are going through life without taking the time to know themselves, nevermind even listen to themselves. That is why we are so empty. When you can't fill your own glass, you need constant external stimulation to make you think your glass if full.
LBD--The abusers kids are innocents who unfortunately will mimic their abusers unless the cycle is broken. Keeping them hungry to punish, or coerce, their parents to do the right thing won't work--Charity should begin with the young.
I have threatened to reuse the granite countertops for my wife's grave. She frequently says that they will be the death of her- tripped by her dogs to get the food, she will crack her head on the countertops, and I reply I will reuse them for her marker so she can take them with her.
Don't mistake the shift away from complaining as being due to resignation.- RD
I don't think I expressed myself very well. The people here have always been depressed. It's a cliche, but the weather makes people very down, all the time. It gets worse as you go north, until you hit Seattle which has, IIRC, about 57 sunny days per year, and the highest suicide rate in the country. I've lived all over the country, and in some pretty poor areas, including Appalachia and the deep South, but I have never seen a more depressed group of human beings anywhere. You'd have to live here to really understand.
Interesting Times (profile) wrote on Fri, 7/10/2009 - 8:06 am
Anyone discussed the California IOU's being "securities" yet?
Denninger has something on it right now, but I was hoping to get some opinions from the CR folks.
Can't be less than 200 comments on the subject this week. It's gotten so popular I've started a daily post of collected links. Exurban Nation: Daily California Watch
Oh, good the pig. Now I can put this up without disrupting the conversation here.
Lobbyist Ben Dover (profile) wrote on Fri, 7/10/2009 - 8:05 am
Mel,
Yes I do ever clean out a section eight house? Most are abusers not people in need of help.
So the parents are abusers means we don't give the children (who's only mistake was being born into this family) a helping hand?
Hubbert (profile) wrote on Fri, 7/10/2009 - 9:43 am
Most people are pretty brainwashed: a good part of the "middle-class values" include trusting the system and the banks.
No, it just includes the concept of trust as an intrinsic part of human behavior. The assumption of the educated middle-class adult is not that everyone is an angel of virtue, but that there is a high degree of probability that another person, business, etc, is trustworthy, and that those who are not are the exception far more than they are the rule. Once you break that assumption the entirety of the social contract and the rule of law start to fall apart, and with it so does your society.
Unemployment has been a slightly leading indicator if you were to look at the establishment survey sans B/D. Still not out of the woods, but things are getting less bad. The problem is with JIT & automation, businesses now know just how lean they can really be.
Hate to go all Kudlow, but if we really want to see if America still has an entrepenurial spirit we should make health care reform as much of a priority as the bailouts, if not moreso.
Agreed: what's even scarier is that the only positives in this economy in the last 10 years were the credit and asset bubbles: with the so-called "jobless recovery," the number of jobs is about where it was in 1999. And Krugman wrote as far back as 2006 about the 80/20 myth: that only Neanderthals were struggling, but college graduates were doing OK, when in reality, income was flat for the top 20% and even the top 10% of earners: you had to look at the top 1% or top 0.1% to see wage growth.
So for people who were too young / too poor to participate in the bubbles, and actually were working for a living, times have been very tough for a long time.
Some papered over with credit, but that's gone too.
So you are saying what I am saying, The system is broken and is to much of an enabling program that really continues the abuse from generation to generation. You should really look at Fly over small town America They milk it badly. The real abuse is leaving the kid in this environment. No kid, The parent doesn't get a free ride. That simple.
Vonbek777 (profile) wrote on Fri, 7/10/2009 - 10:09 am
I know everyone wants to focus on how fat we are (and I am one of them, gluttony is a sin I know well) but I still hold the best thing for America would be a mandatory time out for everyone over 12.
Vonbek, I'm six two and skinny as a rail and have been a meditator for years. I mention the obesity issue because it provides a tangible example of the real world effect of unbalanced consumption, while simultaneously establishment economic propaganda tells us that consumption is the highest good and a valid end-in-itself.
LBD-- There is no better place for these kids--by the time the system is aware of the neglect and abuse, the kid is already "difficult." We don't need to relive Dickens--we need to break the cycle by integrating the population. If Johnny's mother is ridiculed for her poor treatment of her family, she might change. 100s of years of treating people like shit leaves a stain that can't be easily washed away.
At the beginning of GD1, there was a widespread view that all the blame was justly heaped on the individual failures of the "bums" who couldn't make it in this the best of all possible worlds - as the economic blight spread and encompassed more and more of these "virtuous" souls, there was a sea change in how their plight was viewed.
If Johnny's mother is ridiculed for her poor treatment of her family, she might change. 100s of years of treating people like shit leaves a stain that can't be easily washed away.
That sound quite contradictory.
You can't mistreat the child but it's OK to ridicule the mother???
Sorry but I have not witnessed many cases, if any, where the ridiculed became better people.
Sounds like someone hasn't been giving away enough free ponies.
My daughter is in summer school. Like her father, she is "math challenged." The school provides lunch for a fee. The problem is they are bringing it in from fast food places and charging for it. So lunch is going to cost her about $5.
Fine, she can bring one. What makes it interesting is that a lot of the kids in summer school were also the ones getting almost free lunches. They can't afford it and I guess there is nothing at home. So they don't eat.
My cooworker was telling me this morning about how theu converted the garage into a room for her Mom. Why? Because her sister and kids were homeless and Mom had a paid for house. Sis gets the house and Mom moves in with them.
The security guards as I came in were talking about how "its all about money" and how there is none out there.
I have been thinking. There is and was a lot of financial fat on the bones of America. Pretty soon we should be getting close to the bone for the first wave or two. Nothing left to sell. House gone. Cards gone. Job gone. Unemployment still coming in but the end is in sight.
The clock is running here....
nova -----Hope they include psychiatric benefits in the health care reform--many in your family will feel the need. --Or they could legalize pot--a cheaper option.
I wasn't questioned, but was permanently laid off in April, and my sentiment is extremely low.
Didn't realize I had been pigged. Thought everyone was gone in the other tread for a minute, scrolled up and there was piggy. Anyway, repost
nova,
I think that financial edge of the cliff is getting closer for a lot of people. Wife and I were talking about all the heated domestic disputes we are seeing in public over 'money' issues. More correctly, spending money issues. Nerves are frayed, and tempers are short. Best ones are dads explaining to teenage daughters that cellphones aren't a necessity. Lots of families moving to pre-paid cells. Lots of teens unhappy.
July 7 (Bloomberg) -- A record 33.8 million people received food stamps in April, up 20 percent from a year earlier, as unemployment surged toward a 26-year high, government figures show. Spending also jumped, as the average benefit rose.
It was the fifth straight month of record participation in the Supplemental Nutrition Assistance Program, according to the U.S. Department of Agriculture, and up 1.8 percent from the prior month. Total spending was $4.5 billion, up 19 percent from the previous all-time high reached in March, the USDA said.
Jim asked on the prior thread "Is it selling to loan at no interest with cash back? When does a sale become a subsidized gift?"
This can actually be really profitable. A good example is a jewler near where I used to work. Like most jewelers, he had a high markup. He sold at just below retail with 50% down, and payments with credit-card type interest rates (15-25%). Sometimes, he would have a no interest for 12 months sale, and throw in some "free" stuff at the sale.
How could he do this? His cost was less than 50% of the sale price. He recovered his cost, but not his usual profit, as soon as a credit customer purchased. All of the subsequent payments on the loan were profit. The "free" stuff he tossed in didn't cost him much, and he still made a small profit even if they didn't make a single subsequent payment.
Oddly, he helped a lot of his customers establish credit, when no one else would give it to them (early 1990s, before breathing was the sole qualification for credits, RIP Fog A Mirror, Get a Loan, 2002-2007)
Mel, In the best of times a lot of my family needs help.
von Bek,
Yes. I am having a "holy sh^t moment."
The Mrs two youngest would LITERALLY be devastated without a mobile phone. It would be like them dropping off the face of the world.
Nova....the school food program is a crime. Used to be the schools PREPARED lunches - not ordered in from junk food establishments. Not to mention, coke machines in school? You gotta be kidding. How about white milk and REAL juice - not the kind "made from real fruit flavors"!
Many more are feeling it - and worried. When our local Fox News channel (night before last) spent more time on the bad economy than Hollywood, I even was shocked.
I wonder how long we can keep up this complexity in society? Tainter is becoming more relevant by the minute.
With food stamps at record levels, longterm unemployment at record levels, underwater mortgages at record levels, I'm amazed that there is not much noise about the new bonus round for AIG employees.
The citizenry, or excuse me, the consumers, are surprisingly quiet.
I believe the period we are entering is in many ways be analogous to the Middle Ages in Europe. What happens when the King, because of bad policy decisions, becomes too weak to project his power throughout the kingdom? The other nobles become restive and begin to gather power onto themselves. What happens when these regional nobles (States) because of their own failures can no longer maintain the Kings peace for him?
This was inspired, partially by this post here.
Resistance is Feudal (Poster, Calculated Risk) wrote…
Once the integrity of the monetary system is breached in the general public mind, it gradually ceases to have significance or ability to regulate behavior in any way among even the “suckers” whose value systems made a middle-class possible. That, not the loss of economic status, but the progressive disintegration (through growing irrelevance and lack of political potency) of the middle-class value structure and beliefs, routs the socioeconomic distribution into rich and poor since there are no other choices left.
It is the calm before the storm. I don't believe it will be Mad Max but it's going to be a rough late summer and fall.
most of us here look for cause and effect and try to put our finger on the reasons-why for the financial crisis
MBS, CDS, ratings agencies bought by financiers, the poor buying mcmansions, low interest rates at the fed, a breakdown in regulation, no doc loans etc etc
but is there not a root cause the hides underneath?
the usa has been gutted by year after year of trade imballances that rivaled and sometimes almost equaling the federal deficit
we outsourced jobs, eliminated tariffs, asked american workers to compete with countries that subsidize their industries and facilitate export goals (forex manipulation) and in some cases use child and nearly slave wage labor w/o any human rights or environmental controls
we refused 21 century energy technology in favor of buying foreign oil
and all these dollars flowing abroad had to be "recycled"...what to do with the worlds supply of excess dollars//
we, the usa became the world leader in selling paper
we securitized and repackaged debt and re-allocated and mis-allocated our capital into financial services and corporate take-overs while our current account balance ("trade debt") pulled us underwater like an anchor
consider this ,30 years ago we owed the federal debt to ourselves...
us corps, institutions pension funds and individuals owned the vast majority of bonds and t bills and notes
today...we are owned by others and the root cause imho is imbalance of trade and the associated debt involved
Fried
I think consumers are too busy trying to figure out how to consume less and live. When people become depresssed, they get quiet. Most people don't know who to be angry at, it is a system failure. No direct target to aim at, it is all falling down.
fried,
be, very, very, quiet....we're hunting AIG
Don't take the silence as complacency, the knives are being sharpened.
I believe the period we are entering is in many ways be analogous to the Middle Ages in Europe
The Middle Ages will be a cake walk compared to where we are heading. They had a intact ecosystem, unexplored and virgin continents, oceans full of fish.
We live on a warming planet, raped and scraped with 6.7 billion people living off ancient sunlight.
In my small world I don't see anger. I see fear. I see people worrying about immediate needs, not far away people who screwed them but exist in another universe. It is when you realize, and accept that this is it - possibly forever, that I think you will see anger.
josap
that may change...witness bob marley
Them belly full but we hungry
A hungry mob is an angry mob
A rain a fall but the dirt it tough
A pot a cook but the food no 'nough
Cost of livin' gets so high
Rich and poor they start to cry
Now the weak must get strong
They say oh, what a tribulation
Them belly full but we hungry
A hungry mob is an angry mob
A rain a fall but the dirt it tough
A pot a cook but the food no 'nough
(as long as the corporate government keeps people fed, and entertained, mob action is unlikely...a roof over the head is also desirable...im not a fan of mob action, very scary and unpredictable stuff)
A.I.G. Seeks U.S. Support for more Bonuses to dozens of its senior executives.
....should drive Consumer sentiment lower and anger higher !
Geither, the head of the GS-USTreasury Conglomerate, is seeking authority to make GS the supreme ruler of the derivatives market.
Wiki on Tainter:
"We often assume that the collapse of the Roman Empire was a catastrophe for everyone involved. Tainter points out that it can be seen as a very rational preference of individuals at the time, many of whom were actually better off (all but the elite, presumably). Archeological evidence from human bones indicates that average nutrition actually improved after the collapse in many parts of the former Roman Empire. Average individuals may have benefited because they no longer had to invest in the burdensome complexity of empire."
I see fear at the local level... but on the small private business owner level...there is growing anger. And these people are talking at the golf course and the country clubs and the business associations. I am not talking about Republican born again tea parties here, I am talking about real business owners who are seeing their way of life destroyed by a corporate gang rape facilitated by the banking industry. These people won't go down without some kind of fight. Shooting the captain of a sinking ship is a little bit counter-productive though.
Free School lunch programs are another way to free up money for abusive parents to buy crap. This is not help but enabling.
That CONsumer CONfidence survey would have been lower if I had been polled.
" July 10, 2009
China’s exports dropped 21.4 percent in June year-on-year, but did rise 7.5 percent month-on-month, Xinhua reported July 10, citing customs data. Imports in June dropped 13.2 percent year-on-year, after a 25.2 percent fall in May."
Lobbyist Ben Dover (profile) wrote on Fri, 7/10/2009 - 10:38 am
Free School lunch programs are another way to free up money for abusive parents to buy crap. This is not help but enabling."
Do you honestly think those type of parents don't buy crap instead of buying food for their kids? For many kids, school lunch programs are the only sure meals of the day.
Most people are pretty brainwashed: a good part of the "middle-class values" include trusting the system and the banks.
That's hard to shake even when "homeownership" was proven NOT to be "your family's largest / best investment" and the banks have captured the government.
You can't really say these in public:
* America produces about 3x the number of "home grown" engineers that we need: the only reason for the vast majority of H1-B visas is to lower the wages of the middle-class
"mock turtle (profile) wrote on Fri, 7/10/2009 - 10:28 am
...but is there not a root cause the hides underneath?
the usa has been gutted ...
today...we are owned by others"
Combine this with the postings by otishertz several threads ago about corporate colonialism, of which my summary is that the internationalists have defeated the nationalists, and it adds up to a mental model that works for me: it is as though we've been conquered.
"Most people are pretty brainwashed..."
One of the stranger ones is that people seem to think that more stuff means a better life.
The ONLY way I can see out of this is to redirect our efforts to within. Forget global notions for now. Start with remanufacturing the basics again. Start making high-quality basic products again within the US. They will cost a bit more, but by the fact you're not replacing them every year with another "throw-away" from China, is proven to be cost effective. Throw tariffs on everything imported for a period of time - screw non-US made products for now. We have 200-million of the best damned customers and workers in the world. Put them back to work, putting out the best products ever made (like it used to be until very recently). Other countries will buy American again - If not, it doesn't matter - we'll provide for ourselves - nobody else is going to!
That CONsumer CONfidence survey would have been lower if I had been polled.
Me too.
today...we are owned by others
Mock,
By some accounts, foreigners own 24% ($14 trillion) of our total outstanding credit ($58 trillion).
The percentage of foreign ownership is increasing too as shown by our current account deficit.
Behold the new world order. One currency shall enslave them all.
My wife survived childhood because of the school lunch program. A child of wonderful California parents (mom married six times plus many boyfriends, doesn't know who her dad is to this day) The assorted birds, snakes, and other exotic pets ate better than she did at home. Without the school lunch (by the way she worked in the school cafeteria during lunch hours because she felt guilty for the free food) she would have starved. As it was, the cafeteria staff took care of her, and fed her from the staff food, which was better than the normal stuff they gave the kids. I agree it is more enabling....but what do you do when a whole system breaks down. The judge knew her family was being abused. She testified to the fact, and the system never did anything.
One of the stranger ones is that people seem to think that more stuff means a better life.
Next you'll be trying to convince us that granite counter tops don't make people happy either.
Playing devils advocate, while I feel fairly negative over the next few years, I am wondering if we won't see a mini-rally over the next 30 days in the tech based stock market. The reason being, all the tech companies gave very conservative guidance for their June quarter and it looks like most of them will meet or beat their guidance. (Notice how few negative pre-announcements we have had since the beginning of July.) Any thoughts?
Suggest you read David Rosenberg daily and incorporate some of his wisdom into your thinking. This is not a typical post-War recession. Many Indices can no longer be read the same way. Unemployment is not a lagging indicator. Consumer demand is absolutely key which suggests that consumer sentiment is much more important than it used to be.
As an aside, one can look at Rasmussen's consumer index to get a indication of which way the Mich. and CB numbers will go. Also the ABC Consumer Comfort Index has been much less volatile that Mich or CB and, IMHO, is a better index at this point in time despite it's somewhat shorter history.
I can't believe the consumer isn't being fooled by the all-is-good propaganda from Washington.
One of the stranger ones is that people seem to think that more stuff means a better life.
Next you'll be trying to convince us that granite counter tops don't make people happy either.
You people are subversives. I can no longer associate with any of you.
The sentiment I'm seeing is "here we go again." The people have been poor for so long, they have developed all kinds of coping skills-- not all of them healthy. There is more resignation and fatalism than anger--a certain detached depression. OTOH that's Oregon at the best of times.
Any thoughts?
I agree, but I think it will be more than tech. I suspect that at least banks will have (surprise!) banner earnings.
“My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel.”
—Saudi saying
Well, to a point more stuff DOES mean a better life. I hate McMansions and my car is about a dozen years old now, and I do value libraries, parks, and nature, but it was nice to finally get my own apartment after being in the workforce for so long.
One of the big lies is that all Americans are SO SPOILED. Sorry, but the Bushes aren't typical. A lot of us (I am on the Gen X/ Gen Y border: in college during the .com boom, started working right around 9/11, and now this) are really just looking for moderate middle-class lifestyle.
Keep in mind that the median HOUSEHOLD income is about $50k. With the cost of education and healthcare and (until recently) real estate, that doesn't go all that far.
Lobbyist Ben Dover wrote on Fri, 7/10/2009 - 7:38 a
Free School lunch programs are another way to free up money for abusive parents to buy crap. This is not help but enabling.
do you speak from a personal knowledge about poor kids who get subsidized meals or free meals at school
i worked as a volunteer in our local school for 11 years (while i worked a full time job not related to public education
i saw first hand kids from families where the parents each worked near minimum wage jobs and many of their kids needed the good meal that the taxpayers graciously provided . btw we passed our local levy with a vote by the people (by a supermajority of 60%) every two years
you should not be so hard on kids...they didnt do this
One of the stranger ones is that people seem to think that more stuff means a better life.
I believe Bob the-angry flower summed up that mindset -> http://angryflower.com/inflat.gif
More things does not mean a better life... NICER things mean a better life
Recent income gains were reported by the fewest consumers in the more than fifty-year history of the survey, the statement said.
"Next you'll be trying to convince us that granite counter tops don't make people happy either."
What? You mean I don't have to feel deprived?
You people are subversives. I can no longer associate with any of you.
I would not subvert any association that would have me as a member.
"scone (profile) wrote on Fri, 7/10/2009 - 10:53 am
There is more resignation and fatalism than anger--a certain detached depression. "
"Resignation and fatalism"- that doesn't sound stereotypically "American", does it? But it fits the speculation that the reaction will be passive-aggressive. That doesn't sound "American" either.
Our spirit has been crushed.
OT-
Ouch:
Mish's Global Economic Trend Analysis: Unemployment Claims: How Bad are the "Real" Numbers?
Newbie wrote "its as though weve been conquered"
to which i say...exactly right
Angry Saver...thanks for the numbers regarding who owns us debt
I also welcome the demise of granite countertops.
My point is that this is cutting way beyond the granite countertop fat and to the bone for so many people.
I said it earlier, but Christmas this year will be telling. I predict many family purchases and less individual presents. Homemade gifts will be up.
NateTG (profile) wrote (in reply to...) on Fri, 7/10/2009 - 9:45 am
"Most people are pretty brainwashed..."
One of the stranger ones is that people seem to think that more stuff means a better life.
Maximal consumption = maximal happiness. Millions of morbidly obese Americans with severe health problems before they even reach middle age can't be wrong. The happiness practically bubbles out of them!
The evidence of the 'wisdom' of our economic mainstream is staring us right in the face.
On a positive note, look at that trade deficit...we're within shouting distance of zero. If crude drops another $10 a barrel and we increase our savings rate a bit more, perhaps we could hit zero fairly soon.
My employer uses electric forklifts instead of propane ones. We just plug them into a charger at night. Good stuff.
Newbie 101 (profile) wrote on Fri, 7/10/2009 - 7:59 am
"scone (profile) wrote on Fri, 7/10/2009 - 10:53 am
There is more resignation and fatalism than anger--a certain detached depression. "
"Resignation and fatalism"- that doesn't sound stereotypically "American", does it? But it fits the speculation that the reaction will be passive-aggressive. That doesn't sound "American" either.
Our spirit has been crushed.
There's alternative explanations.
• Keeping one's powder dry.
• Staying off the radar.
• Declining consent of the governed.
• Front running with necessary discretion.
Don't mistake the shift away from complaining as being due to resignation.
Anyone discussed the California IOU's being "securities" yet?
Denninger has something on it right now, but I was hoping to get some opinions from the CR folks.
Mel,
Yes I do ever clean out a section eight house? Most are abusers not people in need of help.
The security guards as I came in were talking about how "its all about money" and how there is none out there
That is the point I was making to mp a few months ago when he was talking about stabilization. People/small businesses were hanging on by their fingernails and unless we had demonstrable improvement in a few months then we were going to see a downleg. No longterm flatline until recovery. Either moonshot recovery or another step down towards the bottom.
I was pessimistic then. Now I'm certain of a downleg.
I know everyone wants to focus on how fat we are (and I am one of them, gluttony is a sin I know well) but I still hold the best thing for America would be a mandatory time out for everyone over 12. We all need to be put in solitary for a day. No outside stimulation, no communication, so we can hear that small voice inside of us again. Too many people are going through life without taking the time to know themselves, nevermind even listen to themselves. That is why we are so empty. When you can't fill your own glass, you need constant external stimulation to make you think your glass if full.
LBD--The abusers kids are innocents who unfortunately will mimic their abusers unless the cycle is broken. Keeping them hungry to punish, or coerce, their parents to do the right thing won't work--Charity should begin with the young.
I have threatened to reuse the granite countertops for my wife's grave. She frequently says that they will be the death of her- tripped by her dogs to get the food, she will crack her head on the countertops, and I reply I will reuse them for her marker so she can take them with her.
An appropriately green thought;-}
Someday this war's gonna end...
Don't mistake the shift away from complaining as being due to resignation.- RD
I don't think I expressed myself very well. The people here have always been depressed. It's a cliche, but the weather makes people very down, all the time. It gets worse as you go north, until you hit Seattle which has, IIRC, about 57 sunny days per year, and the highest suicide rate in the country. I've lived all over the country, and in some pretty poor areas, including Appalachia and the deep South, but I have never seen a more depressed group of human beings anywhere. You'd have to live here to really understand.
Interesting Times (profile) wrote on Fri, 7/10/2009 - 8:06 am
Anyone discussed the California IOU's being "securities" yet?
Denninger has something on it right now, but I was hoping to get some opinions from the CR folks.
Can't be less than 200 comments on the subject this week. It's gotten so popular I've started a daily post of collected links.
Exurban Nation: Daily California Watch
Oh, good the pig. Now I can put this up without disrupting the conversation here.
Lobbyist Ben Dover (profile) wrote on Fri, 7/10/2009 - 8:05 am
Mel,
Yes I do ever clean out a section eight house? Most are abusers not people in need of help.
So the parents are abusers means we don't give the children (who's only mistake was being born into this family) a helping hand?
Nice!!
Hubbert (profile) wrote on Fri, 7/10/2009 - 9:43 am
Most people are pretty brainwashed: a good part of the "middle-class values" include trusting the system and the banks.
No, it just includes the concept of trust as an intrinsic part of human behavior. The assumption of the educated middle-class adult is not that everyone is an angel of virtue, but that there is a high degree of probability that another person, business, etc, is trustworthy, and that those who are not are the exception far more than they are the rule. Once you break that assumption the entirety of the social contract and the rule of law start to fall apart, and with it so does your society.
Unemployment has been a slightly leading indicator if you were to look at the establishment survey sans B/D. Still not out of the woods, but things are getting less bad. The problem is with JIT & automation, businesses now know just how lean they can really be.
Hate to go all Kudlow, but if we really want to see if America still has an entrepenurial spirit we should make health care reform as much of a priority as the bailouts, if not moreso.
Agreed: what's even scarier is that the only positives in this economy in the last 10 years were the credit and asset bubbles: with the so-called "jobless recovery," the number of jobs is about where it was in 1999. And Krugman wrote as far back as 2006 about the 80/20 myth: that only Neanderthals were struggling, but college graduates were doing OK, when in reality, income was flat for the top 20% and even the top 10% of earners: you had to look at the top 1% or top 0.1% to see wage growth.
So for people who were too young / too poor to participate in the bubbles, and actually were working for a living, times have been very tough for a long time.
Some papered over with credit, but that's gone too.
Mel,
So you are saying what I am saying, The system is broken and is to much of an enabling program that really continues the abuse from generation to generation. You should really look at Fly over small town America They milk it badly. The real abuse is leaving the kid in this environment. No kid, The parent doesn't get a free ride. That simple.
Vonbek777 (profile) wrote on Fri, 7/10/2009 - 10:09 am
I know everyone wants to focus on how fat we are (and I am one of them, gluttony is a sin I know well) but I still hold the best thing for America would be a mandatory time out for everyone over 12.
Vonbek, I'm six two and skinny as a rail and have been a meditator for years. I mention the obesity issue because it provides a tangible example of the real world effect of unbalanced consumption, while simultaneously establishment economic propaganda tells us that consumption is the highest good and a valid end-in-itself.
LBD-- There is no better place for these kids--by the time the system is aware of the neglect and abuse, the kid is already "difficult." We don't need to relive Dickens--we need to break the cycle by integrating the population. If Johnny's mother is ridiculed for her poor treatment of her family, she might change. 100s of years of treating people like shit leaves a stain that can't be easily washed away.
At the beginning of GD1, there was a widespread view that all the blame was justly heaped on the individual failures of the "bums" who couldn't make it in this the best of all possible worlds - as the economic blight spread and encompassed more and more of these "virtuous" souls, there was a sea change in how their plight was viewed.
Don't take the silence as complacency, the knives are being sharpened.
They'll find a scapegoat. Will it be GS? Looks like the movement is growing..
If Johnny's mother is ridiculed for her poor treatment of her family, she might change. 100s of years of treating people like shit leaves a stain that can't be easily washed away.
That sound quite contradictory.
You can't mistreat the child but it's OK to ridicule the mother???
Sorry but I have not witnessed many cases, if any, where the ridiculed became better people.
Head and sholders will probably fail. too many underwater short sellers are anticipating it
. if it does materialize it will stick a fork in the efficient market hypothesis. Target
8400 next week. And then 9000. Interesting Finance & Economic articles