This sounds more like a German perspective than a "European" perspective.

agree fudge_head,

We are in the second lost decade. Or as I like to imagine it: the phantom limb phase.

Well then, thread music:

YouTube - The Shins - Phantom Limb

The only thing predictable about 2020 will be the hindsight.

? We already lost a decade, we are doubling down at this point.

No one will be able to predict the course of events of the next decade.

The rich will get richer; the poor will get poorer.

Let's meet back here in 2020 to see how I did.

pavel.chichikov wrote:

No one will be able to predict the course of events of the next decade.

I'll make a prediction and say that none of the structural reforms that are reccommended in the linked article are followed through on. Especially this one from the article:

For the developing world, export-led growth policies should give way to a more balanced approach, which means domestic demand must rise to replace the retrenchment playing out in the United States. Currency exchange rates must become more flexible.

your tax dollars at work.

Census counting on Biffle, NASCAR to 'get the word out' - USATODAY.com

"Brian Sack"

The guy's last name is Sack?.....

Cue multiple bad puns here.

Ciao
MS

Lost Decade - the folks in the eastern half of the EU [those that were behind the curtain for a couple decades] will know what to do... those in the south will know what to do too - they've had 'lost centuries' before. Northern & western Europeans - not so much.

Given environmental stability and no war, regions in which strong families and community survive will do best.

Nemo wrote:

This sounds more like a German perspective than a "European" perspective.

Ya anyone with dots over their u's ought to be suspect from the get go. Düh!

If you move consumption and production forward a decade, does it take two decades to come back to even?

Nemo wrote:

This sounds more like a German perspective than a "European" perspective.

I think it includes the French.. a little.

I'd be satisfied with a decade so uneventful that it didn't need a name.

I still don't see any way to avoid another leg down unless someone can tell me where the jobs will come from.

pavel.chichikov wrote:

there will be no commercially significant breakthrough in fusion for the foreseeable future

It's only ten years away, just like it has been for the last fifty.

pavel.chichikov wrote:

If the most recent article on fusion power in Scientific American is correct, there will be no commercially significant breakthrough in fusion for the foreseeable future.

Yes, the researchers are still in the research stage. I guess it depends on how you define foreseeable, though.
Meanwhile, we'll need to implement fission systems.

pavel.chichikov wrote:

If the most recent article on fusion power in Scientific American is correct, there will be no commercially significant breakthrough in fusion for the foreseeable future.

You didn't have to read SA to know that - it was a given. Want fusion - work on advanced materials [temps & pressures]. Until those get worked out the rest is only possible inside the sun or ground zero of a thermonuclear blast.

If the most recent article on fusion power in Scientific American is correct, there will be no commercially significant breakthrough in fusion for the foreseeable future.

I believe it. Where is the money going to come from for the massive R/D and capital investment necessary to make such a technological leap? There's a reason why technology has advanced at such a breakneck pace in the past fifty years or so - because we've used so much future money to do so. Well, you can forget about that for the next few decades.

mock turtle wrote:

usa, usa, usa, usa, usa

get with the theme...

üsa, üsa, üsa, üsa...

*You didn't have to read SA to know that - it was a given. *

There are other, technical difficulties it says. But I suppose those are of interest only to engineers and physicists. The conclusion is there, and it means that we will not solve other problems outstanding, by that means at any rate.

Stagflation is the process of stealing money through inflation from loans with static interest rates
it only works for a short while, and then everyone expects/plans/hedges against inflation such that there are no more exposed debts for the government to skim (I say government in a general sense, all debtors profit, and even if the government doesn't collect directly you can consider it a stimulus measure that doesn't impinge government's finances)

Even if this hypothetical stagflation were socially bearable, I wonder for how long do the benefits continue before the financial system adjusts and then what happens when that net boost to the economy disappears

The stagflation of 1970s USA -- which ended up with just a pure inflationary cycle providing no more benefits to debtors -- was ended by massive credit growth, spurned on from the federal level by deregulation and deficit spending. It would appear that this hypothetical period of stagflation could not end in the same way. If that is the case, then this hypothetical stagflation period just ends in a round trip back to square one.

I think that any path forward must ultimately deal with the big piles of debt, those who have to be rescued if they experience an unplanned loss of capital, and international relations in political, commercial, and cultural dimensions.

thoughts?

MLM wrote:

Tim Duy digging a little deeper into something CR brought up a few days ago:
Tim Duy's Fed Watch: Real Personal Income Less Transfer Payments

Love this chestnut from Tim:

Remember how we used to think the next financial crisis would be too little Treasury debt? Good times.

I believe it. Where is the money going to come from for the massive R/D and capital investment necessary to make such a technological leap?

It would have to come from the government, as it nearly always has. But that, as we know, is an evil source.

I can speak to the fact that it has been a lost weekend, and time sure does fly

In a decade, none of this will be memorable

WTF is the topic anyway?

sm_landlord wrote:

We need better force fields.

Now you're talking!

Rob Dawg wrote:

Batteries, PVs, fuel cells or even just falling prices for current art in those fields and we find ourselves in an energy surplus.

Fantasy.

EvilHenryPaulson wrote:

thoughts?

I'm not well versed in the Latin America debt crisis of the 70's, but can't "credit growth" also be a euphemism for what happens when the Fed stops stuffing money into large banks to keep them afloat?

SciAm jumped the ecodoomer Club of Rome AGW shark years ago.

I refuse to get into that again, Rob.

I have my own problems with SciAm.

toyota ghost in the shell denials on tv now

greenchutes wrote:

Did the stagnant growth ever really end for the bottom half? For the rust belt and farm belt? Or did inflationary pressures just migrate from commodities into assets and equities?

No, hell no and in fact it's been straight-up deflation, and yes.

We need cloaking devices -- which are better than force fields.

Apparently, it would be necessary to manufacture many geometrically perfect fusion pellets, introduce them for very short periods of time and then move them on to be replaced by succeeding pellets, for just about 24/7, while maintaining continuous output.

It seems nobody knows how to do that.

REBear wrote:

Were there any sectors (excluding commodities) that did well during the 70s?

The music business did pretty darn well, right up until the end of the decade.

EvilHenryPaulson wrote:

I think that any path forward must ultimately deal with the big piles of debt, those who have to be rescued if they experience an unplanned loss of capital, and international relations in political, commercial, and cultural dimensions.

I'm with you. IMO in the present global economic climate, real wage increases are highly unlikely and therefore private debt repayment is basically impossible. As a result private debt cannot be relieved unless it is first passed to the public and then defaulted on either under a globally agreed upon mechanism or otherwise in less pleasant fashion, in slow motion, country by country.

dryfly wrote:

The US south and west is now just a hot rust belt.

But generally better for tourists and retirees....

energyecon
I agree about batteries and photovoltaics, they are limited by many physical constraints. Fuel cells at least show promise of cost:benefit through improved geometry with new developments/testing in nano manufacturing; but current fuel cells of 50% efficiency might be good enough.
The development to watch for will be solar powered water splitting into hydrogen and oxygen. If that happens then you solve so many problems. Keep in mind a big part of inefficiency comes from transporting electricity over vast distances, and super cooled super conductors are a niche that's too expensive to roll out.
If plants and organisms covering the majority of the earth's surface can do it economically, it's only a matter of time before we mimic it economically.

fried wrote:

China's college educated not finding jobs

"They're just lazy".

Rob Dawg wrote:

Silly me for thinking the decades long progression in battery storage density, PV efficiency and declining cost per watt was something that might continue.

Is there a version of Moore's Law that applies here? It seems that once manufacturing on a nano-scale becomes cost-effective and practical, all of these will improve dramatically.

mock turtle wrote:

weve raped the constitution and destroyed any notion of privacy
weve raped our economic system and sold it as a sex slave to the puppet masters
and weve raped the ocean with garbage islands the size of small states floating in the atlantic and pacific
weve raped the environment with cancerous chemicals and a huge species mass extinction

Not to mention we're in the process of stripping away property rights, and thus denying the public a vestment in the system's future.

On energy sources, no one ever seems to mention geothermal. That industry has materials problems as well, and the solution should come sooner than a solution to the fusion problems. ISTR this planet has a very hot core, and the core is heated by a number of things including energy from the planet's rotation.

Of course, tapping that heat is not easy, and could eventually cause other problems.

I expect that someone will complain about the risk of longer days or global de-orbiting.

sm_landlord wrote:

The music business did pretty darn well, right up until the end of the decade.

Financially or artistically? The disco era was rather dismal....

Cinco-X (profile) wrote on Mon, 3/8/2010 - 11:49 am

TCA (profile) wrote (in reply to...) on Mon, 3/8/2010 - 1:54 pm

I think of Obama more and more like Gorbachev, a passer of the torch to the next best thing.

I've always thought of Obama as the next Hoover - a president powerless to stop events from unfolding that he had little to do with initiating. Now, who will be the next FDR?

cinco-x asked, Why would we want another FDR? "

mt replies

because our other choices would be stalin and hitler

ps...TCA i agree obama looks like hoover

broward wrote:

Structurally imbalanced work and income distribution created the debt.

Buying things we can't afford created the debt-

mock turtle wrote:

mt replies
because our other choices would be stalin and hitler

U.S. energy production has seen little increase in 30 years domestically with the increase in use being enabled by importing fossil fuels.
http://www.eia.doe.gov/emeu/aer/pdf/pages/sec1_4.pdf

Unfortunately, we really haven't increased our renewable production or nuclear energy production much despite the hype (see the doe tables). We are competing for imported energy now so we have to produce our own domestic energy whether that be fossil or renewable or nuclear. I vote for all three.
Table 1.1 Primary Energy Overview, 1949-2008 (Quadrillion Btu) 

Scale, the scale is ignored in airy assertions and arm waves - and does a disservice to the urgency with which the undertaking should proceed - starting with the Dawg's "a panel on every rooftop."

edit: Comment by fudge_hend from thread 'ECB's Jürgen Stark: Lost Decade Possible'

energyecon wrote:

Silly you for asserting that alone will result in an energy surplus.

While I agree that we might not have an energy surplus doing the things Rob described, the effect at the margins would be to drastically reduce energy costs and the power of OPEC, and that would be almost as good as a surplus.

The O&M cost is estimated to be around 2c/kWh.

energy pron

The Oil Drum | Offshore wind farm construction - more pictures

If Obama is Hoover who the is Bush2?

broward wrote:

Things were unaffordable because wages were too low.
The stuff was built, which means it was possible to build it.

If easy credit were not available, it either wouldn't have been built or it would have been affordable.

I'm getting a kick ouf of Mish lately, too.

Public workers make more now because capitalists plundered their private industry workers into sub-par wages.

How hard is that to figure out when nobody can even afford what they had in 1970?

CK

bush is warren harding

broward wrote:

Things were unaffordable because wages were too low.

Citation needed.

Rob Dawg wrote:

That was the kind of surplus I was talking about.

More than a decade to get there - longer given current resource allocations - particulary since we are talking about massive physical capital replacement to move private vehicles from liquid transportation fuels to electric. The impact of renewable electricity production on OPEC is zero without turning over the vehicle fleet to EV's (basically no oil is used for electricity generation).

In addition, the grid is going to need to be rebuilt...

Charles Kiting wrote:

Citation needed.

The increasing levels of personal debt that started in the 1980's can be interpreted as average Americans using debt to preserve purchasing power.

Did anyone check the market's pulse today?

I think it's dead.

need :fire hydrant: icon for the Dawg

Outsider wrote:

Did anyone check the market's pulse today?
I think it's dead.

It's the entire global economy at this point...they keep shocking the frog's legs and telling us it is Riverdance...

greenchutes

Did the stagnant growth ever really end for the bottom half? For the rust belt and farm belt? Or did inflationary pressures just migrate from commodities into assets and equities?

tough question, a big part of post-1970s has been that income growth has gone all towards health expenses ... so they grew, but they didn't get to keep it. Then standards of living grew, but that's because of declining savings / increased borrowing. Manufacturing has dealt with a double-whammy of offshoring AND roboticization.

Whiskey

I'm not well versed in the Latin America debt crisis of the 70's, but can't "credit growth" also be a euphemism for what happens when the Fed stops stuffing money into large banks to keep them afloat?

I don't understand your question. I'll see if I can answer indirectly. There was a debt bubble in 1970s Latin America because the US provided little real returns (due to overcapacity from 1960s growth, and foreign competition), they were doing well (along with Africa) because commodity prices increased since they were used as a store of value (conversely the relative price of manufactured goods fell), they had USD pegs, the whole banking relationship was very friendly, and it was an easy investment story to sell. Soon investments were paying off because of the credit/investment bubble itself and not from any fundamental economic source. The bubble popped, CIA was all over the place, private debts were nationalized, Fed Chair replaced, Volcker brought in with a mandate of regulatory forbearance and fat spreads to save the US banking system. Credit growth is a function of the crowd doing what they know to pay off in their experience, successful parts of the crowd transmit the knowledge to others, like how a bacteria or ant finds food. However you do need balance sheets with capacity to be levered up, so that's why Japan or Germany didn't have credit bubbles and their economies lagged the rest of the world for the last decade.

REBear,

Were there any sectors (excluding commodities) that did well during the 70s?

Good question, I can't answer it off the top of my head. I assume you mean in terms of investment returns, or share of GDP. I guess German and Japanese manufacturing, they had finished rebuilding, had special friendly patent licensing, and were growing market share. What about aerospace manufacturing? Textile sector in South Carolina (as it moved out of NYC)? If you only consider investments within the 1970s, it's probably a fair bet that commodity performance overshadowed everything else. However, there was a lot of churn between different regions within one industry.

I'm with you. IMO in the present global economic climate, real wage increases are highly unlikely and therefore private debt repayment is basically impossible. As a result private debt cannot be relieved unless it is first passed to the public and then defaulted on either under a globally agreed upon mechanism or otherwise in less pleasant fashion, in slow motion, country by country.

I also view it as a problem on a current basis. It's not that American wages are too high, it's that American costs of living are too high. This is part exchange rate distortions affecting PPP, but a large part is the excessive pricing of goods and services which go towards shareholders/debt servicing instead of materials/wages (and divergences in the amount of tax dodging is just one more way to accomplish that).

sm_landlord wrote:

For the last hour or so, it looks like just the HFT computers diddling each other.

When I checked this morning the volume was reasonable, but now I think the VIX must be close to 0. It looks like everyone took the day off early and went home to snuggle with their wives and play with their kids.

EDIT: changed to reflect the potential humanity residing with the

Cinco-X wrote:

If easy credit were not available,

Easy credit was available because capitalists didn't pay it out in wages.

Really, it's not that hard to figure out if you drop your brainwashing.

energyecon wrote:

Rob Dawg wrote:
That was the kind of surplus I was talking about.
More than a decade to get there - longer given current resource allocations - particulary since we are talking about massive physical capital replacement to move private vehicles from liquid transportation fuels to electric. The impact of renewable electricity production on OPEC is zero without turning over the vehicle fleet to EV's (basically no oil is used for electricity generation).
In addition, the grid is going to need to be rebuilt...

CNG?

energyecon wrote:

More than a decade to get there - longer given current resource allocations - particulary since we are talking about massive physical capital replacement to move private vehicles from liquid transportation fuels to electric. The impact of renewable electricity production on OPEC is zero without turning over the vehicle fleet to EV's is zero (basically no oil is used for electricity generation).
In addition, the grid is going to need to be rebuilt...

What's your view on the Picken's Plan? I thought it had merit, and wouldn't be all that difficult to implement, though it too would take probably a decade. We have such a large infrastructure of gasoline stations that it's difficult to transition to an alternative fuel, though as was shown with the transition to unleaded fuel, it can be done.
Rebuilding a "smart grid" would be a good thing, but of course we'd need to start now, but approach it in a way that allows the definition to evolve without wasting a lot of effort due to spec changes. If we start now on the development of a specification for this smart grid, it would take a decade to reach a consensus on the definition, another 3-5 years of design work (pulling #s out of my @$$, but I don't think they're that far off), and then it would need to be built. A design that could begin now that has "the hooks" to integrate into a smart grid once it's better defined could speed things up.

Charles Kiting wrote:

Citation needed.

If you can't figure it out, son, I'm not doing the simple 1 + 1 = 2 math for you.

Capitalists are the problem and more you guys do your "free market stuff", the faster you're going to get failure.

That' exactly what we've seen over the past thirty years, an ever-increasing burden of debt because wages are too low to ever pay it off, and a saturated economy where the majority of people can't break out.

Cinco-X wrote:

No one you've mentioned is even an American citizen; isn't Bob Dole still available? George McGovern (both old)? Walter Mondale? John Kerry? Al Gore? C'mon.

they are all doofuses

in times of gripping fear and even raw terror the sheeple must have a commanding father like fearless leader

cult of personality

i was wrong again with franco and jintao...let me try

anita parone and benito mussolini

as for the citizenship thing...ha

the right wing nuts say obama was born in indonesia

and the left wing nuts say mccain was born in panama

since when is citizenship a barrier

schwarzenegger for president

I have to say the one-sided capitalist brainwashing here is truly amazing sometimes.

broward - I don't think it was capitalism per se. I think it was fraud which infiltrated capitalism.

The reason why there was such easy credit was because the hand that was lending the money was not the hand responsible for the payback.

No?

broward wrote:

not that hard to figure out if you drop your brainwashing.

I think you need to clean the cobwebs out of your . I simply cannot buy your arguments about everyone working less and being better off. Work hard- be rewarded. Loaf- not so much.....

Rob Dawg wrote:

CNG?

Me gusta! Still some infrastructure build out needed, but much less - and existing ICE can be converted if need be in addition to leveraging existing pipeline infrastructure, even to the house potentially - still haven't talked my wife into the natural gas vehicle, but a sufficient tribute to the gods of interior upgrades may close the deal... [hope springs eternal]

pavel.chichikov wrote:

No one will be able to predict the course of events of the next decade.

just like every other decade that preceded it.

energyecon
a panel on every rooftop is much too expensive / ineffective at this time, especially if the plan is for them to earn their keep by powering the grid which would require a massive investment in the grid

however, I've been following off and on some projects in Japan and the USA about splitting water with sunlight
it's appealing because the overall solution is very elegant
but more importantly their efficiencies are improving exponentially, and their costs are low because they aren't dealing with fundamental limitations like temperature for batteries, or degradation/maintenance for photo-voltaics
The Japanese one is in association with their space agency, and the USA one is Nocera from MIT
if they fail, there are always the biological solar powered 'machines' to produce biodiesel, or hydrogen

broward wrote:

I have to say the one-sided capitalist brainwashing here is truly amazing sometimes.

Not that many of us here; it's usually the left wind socialist pap that baffles me.

We will be lost until we relearn what productive capital really is.

broward wrote:

Capitalists are the problem and more you guys do your "free market stuff", the faster you're going to get failure.

Again, citation needed.

No one is arguing that capitalists are benevolent, but you seem to be begging for wage controls. Son, I remember Nixon trying that in the 70's.

The problem with renewable energy is that it is too expensive, but they are much cleaner
The problem with fossil fuels is that it pollutes too much, but it is cheap so thats what we've used

Now how wold you apply a market solution to that? Renewables will become more dominant simply because fossil fuels will become too expensive with increased demand worldwide. We can come up with all the great ideas we want, but ulitimately the market will drive it as it has down slowly over time and will increasingly do so. IMO.

noob goldberg wrote:
Originally I had written 'and beat their dogs' but I immediately felt bad and changed it. Some of those traders might not have dogs.
Once upon a time the had bad days... Now, with the able and willing backing of the US taxpayer to its critical infrastructure and activities, every day is bright and sunny, fawns gambol on eminently-well-manicured lawns in front of Tudor mansions and private security guards with automatic weapons pick off any intrusion upon their -reality within the castle walls.

EvilHenryPaulson wrote:

I don't understand your question. I'll see if I can answer indirectly.

Let me see if I can flesh this out a bit better.

Currently, US banks are taking in as much cash as they can to offset their huge losses. Every time someone has to pay 30% interest on their credit card debt or a $35 overdraft fee on a $2 check, that's money they can't spend on anything else. This is a natural anti-stimulus, and it makes viable investments in the economy less likely. After the Latin American crisis, weren't the banks in the same bad shape (possibly insolvent), and didn't solvency and stability become a necessary condition for the extension of credit?

"If Obama is Hoover who the **** is Bush2?"

........who cares?........after many years of NOT watching the Academy Awards, last night I did, and couldn't tell you who 95% of the people were.....

Oil 81.79 +0.29 +0.36%

Just what this thriving economy needs....$82 oil..

Oh and is it a Holiday today the market is a ghost town.

broward wrote:

I have to say the one-sided capitalist brainwashing here is truly amazing sometimes.

Go long socialism - it will make one helluva come back as the failure deepens.

WHEREAS the cost of energy is extremely important to any society, economy, or any individual's standard of living
AND WHEREAS it is difficult -- too difficult -- to distinguish today's successes from tomorrow's failures
BE IT RESOLVED that everyone should take this seriously
FURTHER BE IT RESOLVED that we need a robust energy matrix that allows the best solutions to advance without impediment

dryfly wrote:

Go long socialism - it will make one helluva come back as the failure deepens.

National Socialism ?

dryfly wrote:

Go long socialism - it will make one helluva come back as the failure deepens.

You're confusing cause and effect; increased socialism will be the reason the failure deepens.

Technology Review: Ultra-Efficient Gas Engine Passes Test

splat wrote:

National Socialism ?

Who knows - history doesn't repeat - it rhymes.

Charles Kiting wrote:

Or it could be interpreted as average Americans purchasing much more than necessary.

It depends on how you define "necessary." Lower standards of living would have been unthinkable 20 years ago. If your wages fail to keep up with inflation, but debt is cheaper, you're more likely to shift to debt to preserve the purchasing power you have. I do believe inflation is a factor (understated CPI, health care, asset inflation, etc.), but so is deflation (job loss, forced wage cuts, loss of benefits). A large reason taxation is less helpful now is that a larger portion goes toward debt service, which to me is the main driving force behind the perception that the government is useless.

Charles Kiting wrote:

Yes, but they inherited it from capitalists.

The ones prior to FDR, or the ones prior to Wilson? It's the creeping socialism that's helped bring us to where we are today.

If Obama is Hoover who the No one 17 and under admitted is Bush2?

Coolidge, of course. De-regulator extraordinaire and Reagan's person idol.

Jesse's Café Américain: Are Traders Demanding US Credit Default Swaps Payable in Gold?

I'll be your savior, steadfast and true
I'll come to your notional rescue
-- Rolling Stones

noob goldberg wrote:

Not addressing the original causes will be the reason the failure deepens. Populist governments and socialism will be the convenient scapegoats for future historians.

Once again I must refer you to the "Depression of 1921", where no meddling resulted in a good outcome and to the Great Depression where lots of meddling prolonged the crisis till another World War brought us out of it. Let's not rhyme with that one.....

Not that many of us here; it's usually the left wind socialist pap that baffles me.

Some of us don't fit on your right-left two-dimensional axis at all.

TCA wrote:

Some of us don't fit on your right-left two-dimensional axis at all.

But you all fit on my Cartesian plot.....

left wind socialist pap
was it noob who imagined 2 sphincters?

Whiskey
The banks (at least Citigroup and Bank of America) were insolvent back then, and they were allowed keep making loans. It was just that the bad loans on their books were taking up a lot of capital, and not providing returns. The insolvency didn't prevent them from generating a credit bubble. In fact the secularly declining rates contributed to a credit bubble -- first of all the high rates meant private balance sheets had little debt, second of all anything barely profitable with borrowed money in the present became more profitable in the future as you could refinance at lower rates. I see the problem today being much much larger than just the banks. There is a low demand for borrowing, Senior Loan Officer Survey 
That holds true for more countries than just the USA.
When debt in aggregate is being repaid, markets by identity aren't growing, and so the only positive returns come from stealing market share and not increasing the size of markets.

Whiskey wrote:

Moreover, the U.S. has had other depressions besides 1921 where doing nothing didn't help, either, such as in the 1870's.

So if doing nothing doesn't work, and doing something doesn't work; I'll opt for the cheaper approach of the two.

somebody is unloading all their tungsten

Cinco-X wrote:

Once again I must refer you to the "Depression of 1921", where no meddling resulted in a good outcome and to the Great Depression where lots of meddling prolonged the crisis till another World War brought us out of it.

I'm not talking about stimulus or other government expenditures, Cinco. I'm talking about ensuring that market rules are applied, enforced, and that markets can operate transparently and effectively. We can argue until the cows come home about whether or not government intervention makes a lick of positive difference in dealing with a recession, but I don't think we'd argue much about making sure that the market regulatory failures that led to this state of affairs should be addressed before any sustainable recovery can be contemplated.

Cinco-X wrote:

Once again I must refer you to the "Depression of 1921", where no meddling resulted in a good outcome and to the Great Depression where lots of meddling prolonged the crisis till another World War brought us out of it. Let's not rhyme with that one.....

While there were many developments in the 1920s, like refrigeration, ultimately the decade as we know it was attributable to a credit bubble that made use of the clean balance sheets. The 1930s USA depression didn't have clean balance sheets.
I don't know what posts preceded this argument, but I don't find it that relevant unless you propose to take a page out of 1930s Germany and begin by repudiating debt on a mass scale -- which despite the negative connotations I just gave it, I do support in principle but how it would be done is a very sticky subject

EvilHenryPaulson wrote:

The insolvency didn't prevent them from generating a credit bubble.

In fact it probably encouraged them. Citi jumped into structured finance because it needed the higher returns (I remember a cover of Bloomberg magazine several years back featuring Tommy Maheras about how he would "supercharge" Citi profits).

Is the most salient common link, then, the dearth of viable investments?

From the $100 bill link:

This 100$ note is most widely used in United States, hence it was very necessary to take some action on growing anti-social activities involved in these.

Can someone please tell me what this means? RFID chip?

My view is another lost decade in the U.S. is unlikely, and I'm more concerned with deflationary pressures in the short term.

Lots of events have been unlikely, yet, here they are.

dryfly wrote:

Cinco-X wrote:
You're confusing cause and effect; increased socialism will be the reason the failure deepens.
You remind me of the libertarians I knew in college... if something was a gov't failure it was socialism... if it was a market failure that too was socialism [not free market enough]... I kept telling them people aren't that purest - don't care just make it f'ing work so they aren't hungry - if they are hungry they eat the fattest piece of meat near them - that being 'the rich'. Until they too are all consumed.
You want to save 'capitalism'? Hope you get that dreaded FDR in time. I don't think we will - I'm betting a lot closer to the real deal - from a socialist perspective that is. After the teabaggers get a shot at screwing it up royally [after 2012]. Then we get socialism screw ups for a while.
BTW of all the libertarians I knew in college - not one of them EVER started a business or worked for themselves. They all either ended up working for big corporations, big gov't or academia... or had prosperous spouses. Never once went without a meal ticket. Nice work if you can get it. I'm sure there really are John Galts out there somewhere - that aren't one dimensional pieces of fiction. Never met one though. Still waiting. Someday.

YES

The libertarian fringe has lost touch with reality and is being led down the path to slaughter- Palin totally invaded their Galt laden brains.

The truth is government is run by folks just like us, and stumbles a lot, falls down some, and collapses too.

Now, a libertarian working for government is just a Grover Norquist away from a conspirator.

Libertarianism appeals to engineers who think people are rational and mechanistic, instead of crazy and random.
Economists just make that assumption for convenience, unless they are being paid to be obtuse, or are closet engineers.

I almost think the true libertarian party is semi autistic in their lack of community.

Someday this war's gonna end...

ink sack embedded in bill explodes on your face if you use said bill to hoover blow
the new bills will be known as 's

Yalt wrote:

I think you underestimate the changes that are to come. But then I think everyone underestimates the changes to come, including me.

I have a rational brain and a realist brain. I'm rationalizing my way through this because if I defer to my realist brain I drink too much.

I've had numeorus conversations on this topic with a wide spectrum of Europeans and Brits I've met on my travels. When you talk to the Brits to a man or woman they sau they manufacture nothing anymore... unless we pull a rabbit out of the hat like say the invention of the micro-processor or real cold fusion or a space elevator (I like the idea)...

Citizen AllenM wrote:

Libertarianism appeals to engineers who think people are rational and mechanistic, instead of crazy and random.

Hey man, I'm an engineer, and I think people are crazy and random. Stop the senseless stereotyping!

EvilHenryPaulson wrote:

WHEREAS the cost of energy is extremely important to any society, economy, or any individual's standard of living
AND WHEREAS it is difficult -- too difficult -- to distinguish today's successes from tomorrow's failures
BE IT RESOLVED that everyone should take this seriously
FURTHER BE IT RESOLVED that we need a robust energy matrix that allows the best solutions to advance without impediment

Here, here!

Duke of Con Dao wrote:

or a space elevator (I like the idea)...

ALL HAIL DUKE, BRINGER OF THE SPACE ELEVATOR.

(I, too, have dabbled once or twice in the space elevator fantasy).

MLM wrote:

.
Hey man, I'm an engineer, and I think people are crazy and random. Stop the senseless stereotyping!

Are you a libertarian engineer?
Then I was not stereotyping

Someday this war's gonna end...

Citizen AllenM wrote:

Are you a libertarian engineer?

This is all just code for Asperger's Syndrome, right?

*Past-due commercial real estate mortgages and construction loans rose in the Chicago area during the fourth quarter and are expected to climb even higher before the woe begins to ease.

Local delinquent commercial mortgages — those with payments 30 days or more past-due — rose to 6.2% of all mortgages during the fourth quarter, compared to 5.9% during the third quarter and 4.0% during the fourth quarter, 2008, according to Foresight Analytics LLC, an Oakland, Calif.-based research and consulting firm.

Meanwhile, the local delinquency rate for construction and land loans — which include the troubled housing sector — shot up to 25.7% during the fourth quarter, compared to 24.0% during the third quarter and 14.8% during the fourth quarter of 2008, according to Foresight, which collects data on bank loans from regulatory filings.*

Link includes hockey stick charts...

Delinquent mortgages, construction loans rise in Chicago - Chicago Real Estate Daily

This explains the new FDIC setup in Chicagoland

tg wrote:

Technology Review: Ultra-Efficient Gas Engine Passes Test

That is a sh!t kicking improvement in efficiency - but scale up presents a challenge:

The company, which is supported by venture-capital investments from Venrock and Khosla Ventures, plans to manufacture its system itself, rather than licensing the technology. It plans to build its first factory in 2013, and to introduce the technology into production cars by 2014.

Citizen AllenM wrote:

Are you a libertarian engineer?

Actually, you have to be a religious zealot to be a libertarian or a socialist. I'm a proud member of the "church of what works."

Citizen AllenM wrote:

they were called supernerds.

They still are, I suppose. I've actually seen people who've used it as a political asset at work, and I think that's a more common phenomenon than people realize. When you turn up the Rain Man, people don't think they're smart enough to audit your awful spaghetti code.

Whiskey:
what's weird is that I worked with Tom Maheras when he came to Solly, he joined their hi-yield group. nice ND grad, a bit of an a** kisser and a good order taker - I was bit higher up on the food chain and I showed him the ropes and then promptly faded into obscurity as he rose due to his rabbi MD Paul Ross....
as I said before I can see Rubin easily pressuring Tom to take on more risks...
<just wish I had part of his bundle!

Actually, you have to be a religious zealot to be a libertarian or a socialist. I'm a proud member of the "church of what works."

Philosophically, I'm an anarchist although I'm under no illusions that it would make for a workable society.

MLM wrote:

Actually, you have to be a religious zealot to be a libertarian or a socialist. I'm a proud member of the "church of what works."

Then I guess you should skip free marketer too- unless moving to Mogadishu is in your future.

Free markets are useful, as long as the thumb is kept off the scale.
The only thing that keeps the thumb off the scale is decent government.

Someday this war's gonna end...

LAM wrote:

This explains the new FDIC setup in Chicagoland

Those deliquencies rates are reflective of the entire nation. For CRE, mix increased cap rates from bubble lows and falling occupancy and you've got yourself a bloodbath. The full force of the CRE debacle will be among the factors (or maybe the straw) forcing another leg down. Fundamentals are a bitch.

yuan wrote:

I think your are "misunderestimating" the power of Ben's magic pixie QE dust.

No, just looking through the cloud of dust.

Thanks. Just wanted to make sure it wasn't massive government spending / government employment.

My understanding is the drilling gulf natural gas wells is uneconomical by about 1 to 4 (or 5). Losing about $.80 per dollar with current natural gas prices.

Don't know if anyone has seen this yet, but make your own graphs online:
Google - public data

Today is the first day it is up, more data sets will make it more interesting but it is already pretty cool.

Citizen AllenM wrote:

Free markets are useful, as long as the thumb is kept off the scale.

No argument here. If my choice is Mogadishu or Pyongyang, I'll take door number three please.

Interesting Times wrote:

This one might sting a little.

The question is how much of that trash was passed at the Fed Window? If the banks are forced to do this (and haven't offloaded it to the taxpayers already) banks like home equity loan king in CA, WFC, are toast. However, I think we, the taxpayers, through the Fed Window, already own most of that crap.

EvilHenryPaulson wrote:

to a market where the one who can avoid competing wins

Barriers to entry and limited competition are two of the most important factors in success already. That is why derivatives are so lucrative.

All Money In The United States Comes Into Existence As Debt – So What Will Happen Now That Bank Lending In The U.S. Is Contracting At The Fastest Rate In History?

Video from the "Make Markets Be Markets" show, brought to you by the {cough} Roosevelt Institute. Now with audible audio. These folks consider themselves the committee to save the world, and they couldn't even broadcast this thing properly to begin with.

Make Markets Be Markets | Roosevelt Institute

What are the chances that anything Soros is involved with is going to lead to a better system?

Citizen AllenM wrote:

Your understanding is flawed, I just went through the conference call and the balance sheet of a small E&P producer- they are profitable, just slightly.

Either my source is flawed or your source is flawed. I've listened to many conference calls in my time, and most of them have been flawed. However, my source could be wrong. Where is this company drilling?

Elvis wrote:

However, I think we, the taxpayers, through the Fed Window, already own most of that crap.

Not too concerned. In a participatory democracy we can rewrite the rules. Property and assets are reversible societal covenants.

Duke of Con Dao wrote:

what's weird is that I worked with Tom Maheras when he came to Solly, he joined their hi-yield group. nice ND grad, a bit of an a** kisser and a good order taker

Between this and the good looks, I can see how he was able to rise as far as he did. I only heard about him second hand, and apparently he was a popular guy with the troops.

Elvis wrote:

BTW, conference calls are usually only as good as the quality of questioned asked by the listeners.

Conference calls are never good.

Duke of Con Dao wrote:

what's weird is that I worked with Tom Maheras when he came to Solly, he joined their hi-yield group. nice ND grad, a bit of an a** kisser and a good order taker

Link please

Utah, the company is Gasco (GSX) and most of their production is in Utah. They had a further issue in too much gas available in the Rockies, but with the new pipeline to the midwest completing, that pricing issue is now mostly moot. They have successfully recovered (hopefully) from their debt driven near death experience. The reason why I use them is because they are fairly small, and do a good job identifying all of the costs for increasing producition.

They are going to do a ton of reworks to keep up their flow, and the costs of reworking a well has fallen in half to $350k- they also have a bunch of spec plays that could come in, including California acreage that is being drilled by a partner in the area Oxy just hit. That is my current oil/gas exposure- a D rated play- but you have to speculate on geology to pick up 20x winners in oil and gas. For that you buy some dusters.

Their debt has been their millstone, they just sold a ton of midstream assets they built up to pay down JPM credit line and that will be an immediate improvement in cash flow and ability to deliver. IMHO.

Someday this war's gonna end...

It is Monday, so why is the Dow ?
or does just S&P count?

Elvis wrote:

Right. Because there are not good enough questions.

Good questions just mean the call takes even longer.

noob goldberg wrote:

Good questions just mean the call takes even longer.

Yes. But, at least, they make people squirm. The resultant answers are often so stuttered it is funny.

noob goldberg wrote:

Conference calls are never good.

I beg to differ. I was on this call and I almost burst a blood vessel I was laughing so hard:

Open-mike Earnings Call Blooper

The old Overstock CCs with the sith lord rants and Bob O'Brien phone calls ("I don't know you, right?") were pretty good stand-up routines too.

Yalt wrote:

I beg to differ. I was on this call and I almost burst a blood vessel I was laughing so hard:

Heh, sometimes that 'mute' button sticks.

As an aside, volume today is incredibly low. 140 million on the dow with five minutes left.

As an aside, volume today is incredibly low. 140 million on the dow with five minutes left.

Fascinating. What's this market waiting for ?

Interesting Times wrote:

Fascinating. What's this market waiting for ?

I wish I knew.

Interesting Times wrote:

Fascinating. What's this market waiting for ?

Like every other shopper: 50% off or more sale.

ResistanceIsFeudal wrote:

Capture of social surplus into private or semi-private hands has been the name of the game for a long time. 'Capitalism' in the raggedy Randian-randy sense of the word died out when manufacturing died and the perpetual-war defense-industrial economy was born.

I wonder what kind of world exists when there is no "social surplus". North Korea or Mogadishu?

sm_landlord wrote:

Oh, oh into the close.

Ended at 171 million shares on the Dow, down 13.6 points. What a boring day. Again.

Citizen AllenM wrote:

They (and partners) are going to drill a well that will go down 14k feet and then turn horizontal for a mile and do a frac every 250 feet- that is some technology- I am awaiting the outcome of that $7 million experiment.

All Bakken wells cost around $5 to $7 million to drill. If they are drywells or marginally producing and/or oil prices fall below somewhere around $60, it is a burden for small companies. My guess is bigger companies are taking over the Bakken especially with tight credit..

Ended at 170 million shares on the Dow, down 13 points. What a boring day. Again.

This is what, 10% of regular volume? That's pretty dead to me.

People are functioning at more than 10% biologically when they are in a coma.

‘Housewife’ gets loan modification for Coto home - Lansner on Real Estate : The Orange County Register

Another successful loan mod!

Who's up next, Canseco?

nova: link please?
to what... I worked in corporate bonds at Salomon when Maheras came aboard. spent a good deal of time with him in the early months. very nice guy but on reflection to eager to please esp. our MD Ross who played his rabbi in his push upward and then they were bought by Citi and that group were well positioned.
...

March 8, 2010

"Greek Prime Minister George Papandreou on March 8 said Greece will have difficulty implementing its reform program if the gains from its austerity measures “are swallowed up by prohibitive interest rates,” and he said, “Europe and America must say ‘enough is enough’ to those speculators who only place value on immediate returns, with utter disregard for the consequences on the larger economic system,” Bloomberg reported. Papandreou added, “An ongoing euro crisis could cause a domino effect, driving up borrowing costs for other countries with large deficits and causing volatility in bond and currency rates across the world.”"

Exactly what is happening with this well, GSX has the dirt, and is providing some of the money, but the money is coming from deeper pockets. The well would prove up the area as more productive than Bakken, and with the Rockies gas pricing issue solved, I would guess it will revalue all of the acreage and prove up a buyout. Partner is supposedly XTO- so you can guess the fate of this should it be productive.

I suspect it will, and have placed my chips accordingly, and the drillbit shall possibly spin me a winner.

Or not.

Someday this war's gonna end...