naked capitalism

Anonymous says:

“In my view, policymakers tend to see the current account deficit as almost an unimportant residual, something that just falls out of the global economy, but tells you little about the economy itself. I tend to view it as representing a fundamental imbalance. I believed that as part of the adjustment of the past year, a combination of import compression and export expansion would eliminate the imbalance, and that the appropriate role of policy was to facilitate and cushion that imbalance.”

Sensible trade management should have begun ten years ago. Now it will be so much more painful. The US has no other choice, really, but to impose import quotas. Along with the return to sensible tax policy, increasing treasury rates to encourage domestic savings, stripping agricultural subsidies, and repudiation of CDS. All the rest has been a miserable failure and will continue that way.

Actions by the mercantilist nations of Germany, China, and Japan are making it clear that the situation has become every man for himself.

Anonymous says:

“The ascendant environmentalists disdain (to say the least) the internal combustion engine and everyone associated with it. Most of today’s limousine liberals are embarrassed by their political alliance with the workers who built those limousines.”
William Kristol in “Left and Right, United in Disdain for Detroit and Its Workers” It should be emphasized that the vanguard of the progressive movement is not only anti-capitalist it is anti-developement period. The goal is substantial reductions in population and GDP. This is one reason not to expect much out of the new administration.

Peripheral Visionary says:

The real root of the problem with the auto bailout is that it is the cost of retiree benefits, not the current cost of labor, that is crushing the Big Three. But retiree benefits are a third rail of politics, and so Republicans and Democrats have made the extremely unfortunate decision to go after the current management and the UAW, both of whom are only marginally culpable for the current mess.

Given that the stone around the auto industry’s neck is the burden of retirement benefits (and massive crushing debt), I really don’t see any way out other than bankruptcy filing. Government assumption of retirement benefits is tempting, but it would set a terrible precedent, as every industry in America would be lining up asking for Federal takeover of their too-generous pension systems.

Anonymous says:

Michael Gogulski announced today that he has renounced his United States citizenship and become a stateless person as a means of “political divorce”.
http://www.nostate.com/1227/press-release/

doc holiday says:

Although cats are not usually considered a delicacy by humans, studies have linked the consumption of cats by cows as being a primary nutritional source for multi-vitamins. Cat sausage has become a highly sought after item at many New York Delicatessens who have struggled to keep up with demand…

I know, boring…

Richard Smith says:

Doc, glad you are back.

Looks a bit preoccupied, that cat.

Merry-will-go-round says:

More magnificent business punditry cited in cnn.money.com today:

‘”…said Bernard Baumohl, chief economist for the Economic Outlook Group. “Ultimately, housing is the epicenter that’s holding back the banks and the economy from growing.”‘

When your economy is signficantly dependent upon increasing housing debt to produce GDP “growth,” you should realize there are much deeper problems in your economy than housing market fluctuations.

Anonymous says:

Federal Reserve sets stage for Weimar-style Hyperinflation

by F. William Engdahl

Global Research, December 15, 2008

http://www.globalresearch.ca/index.php?context=va&aid=11401

The Federal Reserve has bluntly refused a request by a major US financial news service to disclose the recipients of more than $2 trillion of emergency loans from US taxpayers and to reveal the assets the central bank is accepting as collateral. Their lawyers resorted to the bizarre argument that they did so to protect 'trade secrets.' Is the secret that the US financial system is de facto bankrupt? The latest Fed move is further indication of the degree of panic and lack of clear strategy within the highest ranks of the US financial institutions. Unprecedented Federal Reserve expansion of the Monetary Base in recent weeks sets the stage for a future Weimar-style hyperinflation perhaps before 2010.

doc holiday says:

Richard Smith,

I have much to catch up, and thanks for the reply!

Anonymous says:

Your photo reminded me of a photo I took of a cat that had been socialized with a flock of chickens.
Point Reys Peninsula around 1994.

macndub says:

Another boring topic: apparently, the Canadian nuclear reactor that produces radioactive isotopes for medical use is on the fritz, again. This has led to cabinet-level resignations over the past year, I believe. There’s an analogy here with the constant drive toward supply chain efficiency at the expense of flexibility.

Globe and Mail

GloomBoom.com says:

Cerberus should never get a penny of that money. What a joke. It’s actually just a bandaid until Obama gets in.

Glen says:

Just when you thought it couldn’t get any worse – it just did. From Jesse’s Cafe: “Here comes a second wave of defaults and losses” http://jessescrossroadscafe.blogspot.com/2008/12/here-comes-second-wave-of-defaults-and.html