Chicago ... Olympics or Children

Chicago ... Olympics or Children

Chicago has had about 37 children killed this year by gang violence.  Black kids mostly, so who cares.  Apparently no one.

Chicago wants the Olympics to come to Chicago in 2016.  Who cares.  All the rich people and people in power that are going to make millions from the big deals that will come down when billions are spent to construct the venue required for the Olympics.  What good does this do the kids that are getting killed.  Nothing, absolutely nothing.

What is important.  The kids or the Olympics. 

Where is our country putting the effort.  Well, it is not the kids.  Where is this country willing to put billions of dollars into to make everything come out all right.  It is not the kids.

Where are our values in America. Where are America's priorities?

Where is our country putting the effort. Well, it is not the kids. Where is this country willing to put billions of dollars into to make everything come out all right. It is not the kids.

Where are our values in America. Where are America's priorities?

What do our actions say

Teaching By Example

I have some great neighbors, they still have a few hill billy genes, but still they are good people. They try to raise their kids the best they can with mixed success. They do a lot of talking to their kids and they have  rules and take interest in their children's lives. It is obvious they love their kids. As a parent with three grown kids I have one strong opinion about raising kids. It is more important the example you lead in living your life than all the rules than can fill a book. For example, my friends smoke. What are the odds of the children smoking?


As a country, the same thing applies. We can talk about democracy, the land of the free, the home of the brave, etc. But, when we forgo the rights of anyone our government accuses of being a terrorist with or without any evidence, then what we say doesn't mean much. When we torture prisoners, then our grand words mean nothing. When we lie about our reason to invade IRAQ then our grand words mean nothing. When we ignore the violence in our big cities like Chicago and then pretend everything is okay because we want to host the 2016 Olympics there, our words ring hollow.


When we say bring us your tired and down trodden and then let 15% of our population have very little health care and provide no childcare for single moms, our words ring hollow. When our religious south talk about being our brothers keepers in their churches and then curse the poor Mexican immigrants, their religion and our country looks pretty lame. When we claim to care about humanity and then pass drug laws that turn Mexico and many other Latin American countries into drug supply centers, one is forced to laugh at our hypocrisy.


How we care for our weakest and our most downtrodden is ultimately how the world will see us. Our battle with the terrorists of the world and the fundamentalist religions of the world is not going to be won with guns and at the moment it is not going to be won with our noble ways. We need to find our values and live them, treating everyone with fairness and with fundamental beliefs that founded this country. We have parted from our basic values before, McCarthism was not that long ago. The way we treated the Japanese living on the west coast during WWII was not that long ago. Sadly, most Americans won't even know what I am talking about since we no longer even known about our heritage.


Do a random act of kindness tomorrow, start turning around America one small step at a time.

What Makes Something Right or Wrong

For many religious people the answer to this question is simple, what does the Bible say, what does the Koran say, then add it to some interpretation and some updating for a centuries and vola, we have a judgment. For instance, the Bible is pretty down on homosexuals and the Koran is pretty down on women being equal. Okay, so maybe I picked some bad examples, but many religious groups have magic books that they look stuff up in to determine what is right and what is wrong.

But, what is the path for us that don't see the light, that are agnostics, or atheists, or even worse scientists or engineers. Where do we look to find out what is right and wrong. First, it is my opinion that we are born with an innate sense of right and wrong that is then reinforced or torn down by those around us, usually our parents.

I also think we can get there my a rational analysis that shows that peaceful coexistence and the traits of the human that makes that possible maximizes the possibility for survival of our species. And if that is not the ultimate goal, then the opposite path, and our destruction, seems in its own construction to be meaningless. What traits make peaceful coexistence possible: cooperation, respect, kindness, love, etc. would all seem to be right and the right thing to do.

There is yet another way. To look at mother nature, to immerse ones self in it and in its details, to find the reason for life and by example what is right and wrong. Look at any mother in nature and how they raise their children. Or wolves that mate for life and live in small communities to help each other survive. Our ants or bees and their complex societies. Or dolphins how they care for the well being of other species, even humans. All we need to know about what is right and wrong is acted out in front of us in the small amount of nature that survives our hard hand, the hard hand of its most powerful member of nature, humans.

A lot of our problems in our culture comes from our disconnection with our roots, nature. We travel on asphalt, live in buildings with artificial environments, spend little time and very little quality time with our mates and family. Vacations are spent in cars, man made amusement parks with their fake water rides, etc, eat in restaurants with their sugar heavy deserts, and never converse with another human about anything important. Our whole existence is about commercialism, the maximum extraction of commodities, fuels, etc. out of the ground for constructing our artificial worlds. We form communities like face-book and thoughts to fill in for the communities we have lost in our race for prosperity, the filling of our lives with imitations of life, which makes me think of the oxymoron of reality TV. Our aliments reflect our loss of our connection with nature, obesity and diabetes are two examples. Cancer one day will surely be linked to the vast use of chemicals that we use carelessly in our lives starting at our birth.

Right and wrong is right out your door in the spirit of the robin that comes in spring, the geese that come in the winter, or the spiders that hunt under your porch. It is with great care that we must use our intelligence in altering our world away from where nature would lead us.

Dire Times and the New Currency, Energy

We are not living in the best of times.  That may be a huge understatement.  Do I think as a country we are going to fall off the cliff.  I guess if I had to pick yes or no, it would be yes.  The yes comes from our inability to see that times have changed, our position in the world has changed. 

We are no longer the richest country in the world by almost any standard.  And our live style is declining by all standards.  Why? Is it us?  Is it our rotten politicans who clearly work no longer for us but to be re-elected?  Well, perhaps in part. Our addiction to consuming and our politicians self interest makes a hard problem almost impossible to solve. 

Energy, cheap energy to be more specific is a thing of the past.  It is no body's fault.  It was given as a gift to us by mother nature and we have squantered most of it ... well, the part that is possible to pump quickly to the surface anyway.  Saudi Arabia is sit sitting on a gold mine, but it is already shrinking so fast that their next generation of the royal family are not getting the stipens they have grown accustomed to.  Bribes to fix stuff in the U.S. political system are not coming as fast as before.  Economic bailouts to buy American military equipment are down.  And, they are having trouble paying off the terrorists to keep them from turning on the hand that feeds them.   But, that is just one small point on the planet.

Nuclear power seems to be the only short term solution and the democrat party will never admit this.  France now gets 72 % of their energy or similar from nuclear power plants.  They now sell power to Europe.  The risks associated with nuclear waste, which are very manageable from my engineering perspective, are small compared to what is going to happen to our society has energy becomes unaffordable.  With affordable energy, all other economic problems are fixable.  Without it, no other economic problem, including health care, is managable.  Our currency is going to go down the tube to prove this point, since it is based on nothing, it has no Energy, the new currency, behind it.

It gives me on satisfaction to say this problem has been coming for a long time and we have been sticking our heads in the soil.  But, that is the way it is.  Carter, Nixon, Clinton, Bush 1 and Bush 2 all gave great speechs about energy and then did very little.  Obama has spoke waxed eloquent on the subject, but it is not his highest priortiy.  If he has to pick medical or energy problems to address with his popularity, the correct long term answer is energy.  It is the foundation on which are society is based.  Energy will give us the "energy" to address the medical problems.  Until then, some rule changes in the medical field would carry us for a few more years and allow us to address the one problem that will not go away, how to power the world we have created on low cost energy.

Well more later.  When I will try to do better stating the obvious.  A world built on cheap energy quits working when cheap energy runs out. 

Nuclear Weapons

Russia and U.S. Presidents are going to get together this month and agree to reduce our deployed, not including stock piled, nuclear weapons to less than 1700 in the near future.

Back in the day when they used to worry about such things, it was estimated that it would take about 100 nuclear bombs to bring on a global winter which would wipe out mankind.  Given the inter-connectivity of life and the delicacy of life in general, this is probably a high side number.  Like it matters.  In any case we will agree to only keep enough nuclear weapons to wipe out the planet 17 times each.  How noble of us.  We (humans) are idiots.

The nuclear club is about seven or eight if you don't count our two newest members Iran and Korea.  The new members are not as revered as old members like Pakistan and China.  Or as righteous as Israel or as just as Great Britain or as proud as France or sacred as Indian, but they are our newest members and deserve all the respect that countries with nuclear weapons deserve.  God bless such self righteous idiots.

Nuclear weapons are like using hangernades to get rid of flies or ants in your house.  And those with those weapons don't want anyone else to have them.  Obviously, one of the most war-like countries in the history of the world (that would be us if you haven't noticed) is to be completely trusted with these toys, but no one else.  Daah.  No one should be trusted with the ability to destroy our planet.  Can you really imagine that we trusted Jehovah Bush with this power. We are idiots.

With kids, and I have learned it applies even to countries, it is not what you preach that matters to most people, it is what you do that matters.  The U.S. speaks great volumes when it agrees to cut the number of nuclear weapons to 1700, if and only if, Russia cuts the number of nuclear weapons to 1700.  Why not be daring, cut out nuclear weapons to 1699, set a real example for the rest of the world.  We are idiots.  Why not cut it to 100, or the correct number to just wipe out the planet once.  If we miss a few people, Russia can take up the slack.  If Martians some day look at our game plan on nuclear weapons there is only one conclusion they can reach. Humans were idiots.

Lost Paradise for Our Children

I am an old fart, in body if not in mind.  I don't much care what happens to me, I have had a great run in my life.  I have lived through the most amazing time in American / World history that will ever be, I think.

I was born right after America with a little (lots) of help from the Russian won the great war against Hitler.  I witnessed the greatest creation of wealth and prosperity the world has ever witnessed.  I witnessed an effort to eliminate prejudice against blacks, gays, women, fat people, etc. An absolutely amazing period in American, and World, History.  Perhaps not since Jesus have people had more hope than we had in the sixties.

In art, we had John Lennon who imagined a world without heaven or hell when it was not popular to do so.  Simple men like Mohammid Ali stood against the government and the killing of people our rulers had decided were evil.  Martin Luther King spoke of the promise land, but like Moses, never got to see it.  Kennedy asked the people to not ask what the country could do for them, but what they could do for their country.  I am afraid the last remarkable thing we will do is to elect Obama.  It is our last gasp, perhaps.

Where did we lose our way.  It is actually quite simple.  We gave up the religion of the Bible and put consumerism in its place.  I do not support either religion, but the masses do.  Perhaps another religion that competed with consumerism is a complete faith in science to solve all our problems.  But, problems of humanity are not external, they are internal, inside the soul, and I use that word with caution. The world as we see it is a reflection of what goes on inside our minds, our souls.  Our thoughts and attitudes ooze from our body and color the world as we see it.

Our economic and social well  being derives from who we are as a people, and that derives from who we are as individuals.  Loving your neighbor is important to insuring our survival as a people and as a way of life.  And, unfortunately, consumerism does not teach such basic truths. The old religion, that I desserted 32 years ago, at least gets this right.  However, the followers of this religon mostly do not apply this principle, so either way, society is doomed.

Now my kids, what kind of world do they inherit.  First, a world that believes in nothing.  Second, they live in a country that is a military superpower but a declining economic superpower.  The superpower part came from a people that dared to dream and believe in a just world.  My children do not give such things much thought and my children are much above the average.  They are great kids.  All of them smart, all of them trying to do what is best and right, which is more than you can say for most. But, they are lost in the quagmire of American life.  The strength of a people come from their beliefs, and sadly our beliefs center around out doing the Jone's.   There are many wonder exceptions around me, but exceptions must become the norm to change the tide.

Our future at the moment depends more on the Chinese than on us.  Its an economic reality.  If you don't know what I am talking about, start reading, figure it out.  The Chinese culture is very old with a lot of wisdom embedded in it.  The current leaders, communists, do not yet reflect the whole of China.  The people of China understand many things they understand about life that we do not understand.  So, them holding the future, or the next hundred years is not necessarily a bad thing for humanity.  It is hard on the white, Anglo-saxon, protestant mentality, but not necessarily bad for the human race. They have a lot to teach us about families, community live, devotion, cooperation, and the good of the whole.

In all, the transition will be tough on my kids.  But, hopefully, they will adapt, accept the new world order and not be stuck with the attitude that we are the greatest.  Not even Mohammid Ali believes in being the greatest in the broader scope of humanity; his humility in later years testifies to this.  In the end, it depends on values, on morals and the courage that comes with living one's life based on principles.  For my kids, I am optimistic that I have helped to give them a set of values that will lead them into this new world.  I am not as optimistic about most of America and their children.  Perhaps this is egotistical, and maybe it is, but I have been fortunate to have children that embody the person(s) I would like to be, perhaps better than I do myself.  Today, Michael Jackson and Fara Facet died.  Michael J didn't seem to me to have a very good life based on what I think I know about him, but who knows.  Fara seemed to be a pretty cool lady.

Socialism for America

There is a lot of fear these days that we are turning socialist, or even worse.  With the government taking over the banks, owning part of the auto makers, and now jumping into modifying medicine, people fear this is the first step in the government taking over the private sector, i.e., socialism.

Well, I would say to those people you have not been paying attention for the last twenty years.  There are three big sources of power in the U.S.,  the two political parties and big business.  The lobbyists are the go-betweens, the grease that makes the machine work.  This was called, the balance of power.  No, the people, the electorate didn't really matter, still don't.  Only 20% of the electorate vote any way, they don't care and they gave up power a long time ago. 

The balance of power has gone amuck since the republicans under their fearless leader shot their wad on Iraq (I almost slipped and said Vietnam, being from that era of time).  All their political capital was used up with the illusion that we, the U.S., still controls the world.  We don't and we control less with every day that passes.  The world is being remade as we speak, primarily by the Chinese, but many others like the Indians or the Middle East are not far behind.  They have the money, we have the debt.  While we worry about petty things like illegal immigrants, with a country we should be in bed with to improve our competitive position with China et al, we haggle over immigrants and continue to fight a war on drugs that has not worked for fifty years.

So now, we are left with just the democrats and big business.  We probably have sixteen years of democrats to look forward to, eight with Obama, eight with Hillary.  Sixteen years is probably enough time to recover from Iraq since eventually the electorate will forget how it all got started, and/or they will remember the democrats were more midgets and funded the effort.

But, what we all forget is that MONEY controls the world.  MONEY and power are very close cousins.  So, who controls the money, China.  China controls the money that the democrats need to continue their illusion of being in control of life in America.  If you are familiar with fishing, I would say that China is about ready to set the hook.  When a big mouth bass picks up your plastic worm on the bottom of the lake, he sucks it in and starts to swim away with it.  If you jerk too soon, you pull the end of the worm out of his mouth.  If you wait too long, he feels the hardness of the hook embedded in the worm and spits it out.  But, if jerk hard at just the right point in time, then the hook pulls through the plastic worm and embeds itself into the jaw of the big mouth bass.

When should the Chinese jerk the line and set the hook.  I would say right after we have sucked in the big juicy worm of health care.  Let us put one more bag goodies on our shoulders that we cannot afford, and then ask the Chinese to fund it by buying our bonds, bonds that we can not possibly repay already.   In this case, setting the hook just requires them to purchase the debt of Europe for a few months instead of U.S. debt and/or move more of their cash into their own domestic economy, which is harder than it sounds while trying to remain in control of all major decisions.  Market chaos could be China's friend, but they are not likely to embrace it too hard or too soon.  In short, we might get lucky and they may not set the hook.

Turning to socialism, nah.  We already have a system.  I struggle for words to describe it, but  lobby-ism, nepotism, oligopoly, etc. are all close cousins.  We don't even have any serious journalism challenging the system, and even if we did, the electorate doesn't read anymore, even the ones that vote.  We get our thirty minutes of news, superficial, negative and self-focused with the illusion that only what happens in the U.S. matters.  The news is only one step ahead of our obsession with reality, or more properly phrased, nonreality shows.  The public is there ready to reprogrammed as required by skills first learned and developed by the marketing people that sold us commercialism, but now used to sell us Presidents and weapons of mass destruction, whatever it is required for us to believe. 

So where does it all lead.  Its simple, are children are going to be indebt to the Chinese.  The Chinese communist party to be more exact.  We have been in the feed yards for twenty years.  We are now fat and ripe, our children have been delivered like veal to the fat business man, and there is really no way out.  I suppose we could all bolt and charge the fence, but I suspect that we could go more like lambs to the slaughter than our forefathers that dumped tea into the ocean.  Hopefully we are at the bottom of the cycle and it is not all doom and gloom like I painted here, but at the moment where we are headed looks like a continuation of where we have been going for twenty years.  And yes, all things are self correcting and eventually the pendulum will swing the other way.  After all, even the dark ages only lasted a few hundred years.

Escaping Capitalism

Capitalism is not a religion, or science, or even a set of rules. But, it is a reality. Capitalism governs the flow of money between makers, consumers, governments, countries, etc. as elequountly as the laws of nature control rain, and water moving between rivers, streams, oceans, the sky and even underground streams. If you disrupt the flow of a steam, say with a damn, the water builds up and for awhile you can deny water access to the river and even the ocean. But, it is all temporary.

By the first level of the laws of capitalism, a lot of banks should have failed. They performed poorly and under free market principles they should have been allowed to fail. But, we decided that we could throw a damn in the river and prevent the natural course of things. Yes, and we have prevented the banks from failing, even though they did a crumpy job at managing risk. In fact, we have reinforced bad behavior. Our children have spat on the floor and have been reward with money from the government. They can do nothing to deserve failure, we will prope them up and guarantee they can fail. The cost, trillions of dollars, for this "no lesson learned" lesson.

How exactly will this play out. I don't know. I know we were afraid to let it play out. We did not trust the basic principals behind capitalism. We decided we could stop the natural order of things, stop those that have been stupid from failing. But, all we have done is dealing with the problem. We think we can write new regulations to keep the same problems from happening again. But, these are secondary laws, much less than the primary laws that says when you take excessive risk and fail you die. Our new regulations will try to make taking excessive risk illegal, but our actions say if you do, we will take care of you, we will hock the American people to take care of you.

An alternative would have been to kick the owners of the bank out, sell their assets to other banks, and insure the accounts of those that used the bank. In other words, take care of those that were harmed and punish those that were stupid and took excessive risks. I suspect those at the top of the banks were really good buddies with a lot of the government officals, in short, they were all part of the good old boy's club.

How will it all come out. I don't know. What I think will happen is the value of our dollar will fall, we will suffer inflation similar to 1974, and we will repeat the same mistakes somewhere in the future, because we avoided the lessons that capitalism was trying to teach us.

Violence in Mexico

 I don't know how many of you have witenessed the violence happening in Mexico.  The police and the drug lords are in a full fleded war.  And guess what, the police are losing.

Of course, we, the Americans, are driving all this with our thirst for drugs: pot and coke being the two highest.  I don't use either now but I have tried both, especially pot.  Of course, I use alcohol, a drug that in my mind is worse than either pot or coke.  And if you throw tobacco into the mix, then pot and coke are health drugs.  And we subsidize tobacco production by giving them subsidies along with other rich farmers.

How hypocritical can we be?  Our hypocricies are costing hundreds of people their lives and is destabilizing an emerging country.

The answer is simple.  Legalize pot and then tax it.  See how that works out and then consider coke.  Make it legal and put the bad guys out of business.  The other option is the drug on wars and we all know how well that is working despite the billions we continue to spend on it each year.

Julie's Health not so Good ... Letter to my son

Mike,

I take Julie to the eye doctor tomorrow.  Julie tried to read her email last night and then came up and took some Alleve and went to bed.  She said her head was still hurting when I went to bed a few hours later.  Julie stayed in bed until 3 pm today, afraid if she tries to use her eyes the pain will return.  At first it was just small type, then newspapers, then emails.  Now, she says she sees a hole in the tv screen.  In retrospect, it has been going on for about a month, but at first the symptoms were similar to mine ... threading a needle with thread, etc.

Julie is also clearing her throat more than normal, her balance is not good, and I believe her cognitive abilities have declined some.  The throat clearing was the first symptom of her cancer last summer ... it was cancer in her lungs.

Your box is on the floor, it has been there for two weeks.  I will try to mail it tomorrow.  I have two addresses, update me on the best address ....

Dad

P.S.  I am going to put this note on the blog along with some pictures.  Ashton has taken it personal mission to watch out for Julie.  He spends most of his day at her side watching her every move.

 

Ashton feeling a little down, below ...

The American Consumer

The American consumer (AC) has kept the world economy going for decades.  However, starting about ten years ago, the consumer kept the world going by using credit. The credit has run out, the world economy has collasped.

We are still taking actions to try to revive the AC.  He is ill, perhaps terminal.  He will never pull the world economy by his coat-tails.  Unless.  Unless, we find away to pay the AC, who is also the AW (the american worker), more money or taxing him less.  This is complicated by the fact that 6 billion workers are all fighting for a job and an improved life.  Those on the bottom are naturally more motivated than us fat cats at the top.  The American Worker, the biggest of fat cats, is possibly going the way of the dinosaur.  Are the corporate VP's going to take less money to give the AW / AC more of the take?  Are all the governments going to tax less to allow the AW / AC to resume his piggish ways?  Are the rest of the WW (world workers) going to roll over and quit trying.  Are more dinosuars going to die to increase the amount of cheap energy (oil)?  Are we going to get smart enough in America to use nuclear energy and reduce the cost of our energy to make it easier on the AW.   I don't think so.  I think the AW, and hence, the AC is screwed.  And for awhile the world will be screwed until we get tv's in all the Chinese and Indian homes and create the new super consumer.

Note from and to My Son

hey dad -so i read the blogs.. actually before you sent your reply

you sound sad... which seems appropriate.  time are getting tough.  i was just talking to a girl that lost both roomates because they cant find work, and she doesnt make enough to pay the rent herself.. one of many stories i have been hearing lately.  everyone seems frazzled -including me -though i am more frazzled by everyone being frazzled than my own siutation.  i am not sure what i should be doing or thinking about at this point.  i stopped smoking pot about a month ago to help, but clarity isn't exactly what i am getting out of it.  i find myself wanting to drink more.  cookies are nice too. 

there are good things happening for me, but the shadows are all obscuring their brilliance.  i am getting closer to actually being able to screen print some stuff -which hopefully i can show you soon.  i am setting up a system to grow more worms and soldier fly larvae (big maggots) as an alternative to grain for chicken feed.  a few other things. 

keep me updated as much as you can- either by continuing on the blog or whatever..  thanks for the offer to come live up there with you -ill keep that in mind.  we are trying to be careful and not actually go broke.  being careful doesnt mean we dont fall though -especially if the ground is shaking.







Mike,

I will be okay.  Just bumped out at the moment.   Hard not to be.

There are market fundamentals behind all of this recession.  But, capitalism is also affected by emotion.  Unbridled  optimism and greed got us into this mess, and pessimism and fear will keep in the mess.  Our job as individuals is to keep the faith and spread a positive outlook.   This is a storm that we have to weather.  

There is a huge correction going on in the world.  The U.S. relative position is declining and resources are being redistributed.  But we still have a substantial advantage with our entrepreneurial culture.  What is very dangerous to our future well being is the attitude that government can solve our problems for us.  It can't.  Instead of doing stuff for us, it has to encourage and enable us move on our own.  Like a parent.  The current attitude that the government can bail us out is a very dangerous path.  The republicans had the torch and they let it go out.  The War undid them.  It became an obsession and they let the rest of the world and our country go down the tube.  The democrats are doing more of what got us in trouble in the first place, excess spending, cheap money, and a belief in itself instead of its people. 

A price will have to be paid for our debts.  I suspect it will come in the form of our dollar becoming de-valuated.  Hyper inflation.   Well this is not helping my state of mind.  

more later, 

dad

Spending our Way to Prosperity

Basics.  I learned long ago that I can do 95% of my job by just understanding the basics of science.  I am a high level knowledge worker, who is above average in capabilities.  Recent graduates often find that their new jobs do not challenge them.  However, this generality does not apply to politicians.  They have one overriding principal, get re-elected.  Promise great things, even things they can't deliver, and when they fail, make bigger promises.

What got the U.S. into the current fix.  Cheap money, the housing bubble, etc., we all know the standard lines.  Let me get down to the real basics: mis-allocation of  resources.  We borrowed and spent trillions of dollars to support an unsustainable life style.  And capitalism and market forces, like it or not, will punish those mis-allocate resources.  Loaning money to someone who can not pay it back is a mis-allocation, i.e., homes, cars, credit cards.  Starting a war we can't afford, and probably can't win by almost any standard, is a mis-allocation.  But there is something even more fundamental going on here.

Did you know last year that Chinese citizens bought more cars than United States citizens?  And, if the Chinese had of been challenging their resources more into their people, instead of supporting our government, the gap in cars, homes, etc. would have been even bigger.  China is the biggest producer of steel, concrete, and many other commodities used to furnish, house, and provide jobs for its people.  China starts up one new coal-fired power plant every week.

Now lets look to the Middle East.  Oil.  Oil equals wealth transfer.  Opulent structures such as ski slopes in a dessert that runs 120 to 140F in the summer.  New cities build by expanding the land into the ocean.  This by any sane measure is a mis-allocation for the human race. Where did this wealth come from?  Well, the number contributor on a per person basis is the United States.  This is where you dollars are being allocated, or should I say mis-allocated.  Will market forces punish this mis-allocation. Feel the pain the United States right now, that is the punishment.

Now our government has just come along a committed to spend a couple of trillion dollars in addition to two wars, an under funded social security system, and enormous interest payments on our debt.  The question is, how much of this money is a mis-allocation.

Do you know that in the past Argentina, Spain, France, England, China, Rome, etc., were all rich countries at one time.  But things changed, the world moved on and the United States got its turn at the top.  But, that is all it is.  It is not something destined to be by the gods for all time.  There is no such thing as a bank, or government that is too big to fail.  The big and the mighty, like the dinosaurs, stick around for awhile based on reputation, past successes, credit, etc.   Everything I see says to me that America is in economic decline.

There are a lot of drivers for our decline, but at a basic level is that we are not producing enough goods and services to pay for our life style.  And, what is the number one thing that we are buying on credit -- energy.  Energy is fundamental to our lifestyle.  Our lifestyle was built on cheap energy.  The day of cheap energy is over.  We are getting a brief reprieve since a person (country) laying on the ground (recession/depression) does not consume as much energy.

Why is energy fundamental.  Because with enough energy, we are now smart enough to make anything: crops, steel, copper, concrete, aluminum, cars, etc.  Sure as ore grades decline, it takes more energy to make copper, steel, etc., but given enough energy we are smart enough to make, to extract from our planet, a living.  This may not always be true, for instance, we may one day over-fish our oceans and destroy our ecology to the point that we can make all we need for seven billion people,  but my opinion is that we are not quite to the tipping point --- yet.  Today, energy is still king.

Whoever has affordable energy resources moving forward will prosper, those that don't will not.  The United States is already one of the most energy efficient countries if you measure it on a measure it against our GNP.  In short, we are efficient at converting raw materials into products.  And we will get better, its in our genes.  So what is the problem.  We consume too many products (translate too much energy) per person.  More than our share based on the energy resources that we have, that the world has.

So out of the $2 trillion we are spending on bailing out our economy and banks, how much is going to alternative energy.  $30 billion dollars.  You might as well go out into your front yard and piss on the ground, that will help us get more energy just as much as $30 billion dollars.  We spend $2 to $3 billion a week on Iraq, not to mention Afganastran  and our general military spending.

Do you realize that France, that we like to make fun of all the time, is much better positioned that the United States with regard to energy.  They make something like 70% of their electricity from nuclear power.  Their mass transit system makes Americans look like idiots.  Our fastest trains go about 100 mph.  World standard is 200 miles per hour.  Take a guess at how much more efficient a train is than a plane in moving people. My best guess is that a train is about 10 times as efficient as a plane in moving people.  I didn't see how much money we are planning on dealing with mass transit, but I suspect it less than the dollars we are spending, and will spend, on pumping up the big three (little three) auto companies.  Again, completely out of touch on what is going on at the global scale.

I have always aliened my opinions with mother nature, market forces, and other global forces (such as globalization) since in the end they always prevail against our feeble efforts as humans.  There are huge drivers, such as the end of cheap energy, that shape our lives.  We either recognize those changes and make adjustments or in the end we are ground up like rocks in front of a glacier.

Home Mortgage Crisis - Who is the Bad Guy

No relief has been offered to the millions of home owners facing eviction. 

There is a smug self-rightousness in America that says they should not have bought a house they couldn't affort. These homeowners that can't now pay their mortgages have become the bad guys to many.  Think again.

Imagine being offered the chance to own a home --- something you never thought possibe.   A place for you and your family.  Sign the dotted-line.  Can you pay this much a month.  Sure no problem.  Of course, this is the wrong question.  The real question is, can you afford this new payment in a year when your ARM mortgage goes from x % to 2X or 3C % rate.  Oh yea, please read the fine print.  Besides, in a few years when things change, life will be better, your job will be better, so don't worry about it.

Who was the bad guy.  The person wanting to buy a home for his family ... the guy trying to live the American dream, or the one that gave him the false hope.

One of the biggest challenges in helping those in trouble with their mortgage is the belief by many Americans that they do no deserve any help. Well guess what.  They should have been smarter, they should not have let their dreams cloud their vision.  But, now helping them helps save America, not helping them lets America keep sliding down the tube.  And, who would you rather help, the Executives at the bank that take the government handouts and then give themselves a bonus, or the common man trying to stay in house and keep his life together?

To me the only question remaining is this ... can Congress make a package to save these mortgage holders that is simple enough to work?  Keep it simple.  If you have a mortgage that is valued higher than the estimated value of your home, you qualify.  If you qualify, you get a 3% loan on the estimated value of your home (from 3 estimators).  That's all.  It has to be that simple to work.

Or we can keep watching the water spin out of the tub.

Israell: Responsibility of the Powerful

With power comes responsibility.   The power in this case is over life and death.  The ultimate power.  And Israel has it.   The people in Gaza are prisoners of Israel, and as such, Israel has a responsibility to care for their well being.

I watched on the news tonight young children holding on to their moms four days after their parents were killed by the Israel military.  And who does Israel think is responsible. Israel's official statement is that Hamas is hiding among the public.  So what.  Hamas is relatively powerless.  Their rockets don't work, they kill almost no one. They are, however, elected leaders of Gaza. 

700 people have been killed by the powerful.  UN relief efforts has been suspended after Israel killed a driver. The political pressure is growing on Israel to stop, although their military wants to destroy Hamas's ability to launch missles.  Of course, to guarantee this, Israel must continue to claim down on the blockade, keeping the Palestinians prisoners indefinitely.  So, what is the long term game plan of Israel.  It appears they do not have one.  They have created a nightmare with no end game.  It is illilogical and borders on being stupid.  No, it is stupid.  It is also inhumane for the powerful to be so calouse and stupid.

Now for the rest of the Muslims.  Saudi Arabia could end this rampage in one day.  Simple.  Shut off the pumps.  Pay the price, shut down the world, or at least, severely cripple it.  Of course, despite the fact that they hate the killing of Muslims, they don't hate it enough to act.  Yea, I understand all, or at least most, of the technical challenges.  Yes it is expensive and would require a huge sacrifice on many fronts.  And even worse, Saudi would release their real power over the world.  But, that kind of courage doesn't happen often, by anyone.

So, those with the power over Israel, the U.S. and Saudi won't act.  Israel will not accept its role as the powerful, the controller of life and death.  So, we all just sit and watch as humans kill humans and other humans provoke the powerful until they die.  It is good we are the most intelligent species on the planet.  Think how we would act if we were stupid.  My guess is not much different than we are all acting now.

Energy Scarcity the New Driver in the World Economies

The last couple of years have been colder than most global warming fans have liked.  My opinion is that the verdict is not in yet -- is the CO2 in the atmosphere rising because the temperature is rising as part of the normal cycle (ice age, thaw, etc.) or is the plant warming because of excess "CO2 gases" in the atmosphere.  But, the details of this discussion are not the point of this discussion.

While I agree that the science behind global warming may be suspect, I believe that our dependence on foreign oil needs to be reduced, nevertheless.   I am one of the those people that believe in the peak oil theory --- that we have reached the maximum oil production for both for technical and political reasons while the demand continues to grow.   China in five years or so will be sucking as much oil as we do.  Our economy falling on its face has just provided a brief reprieve from this "upper limit" on oil production.  (As a corrosion engineer for the oil industry, I see the oil composition on future deposits (five years out), and it is not pretty.  There is a biased look at the International Energy Agency (IEA) report below. The IEA report is more science fiction than the global warming theory by the way. )

I was in Oman this year and witnessed first hand some of the wealth transfer that is occurring from the entire world to the middle east.   Awesome and scary.  Nothing good I am afraid will come of this wealth transfer.

And it is not just oil.  There is a global shortage of energy.  In our technology dominated world, we can do almost anything, except peace, with enough energy.  Grow food, move mountains, build sky scrappers.  But, for the rest of human history, energy is going to be increasingly scarce and expensive.  It is going to limit development in the foreseeable future -- certainly for the rest of my life time.   Back to oil which is on stage now.

I firmly believe oil prices will go through the roof again ($200/barrel) toward the end of 2009.  By 2010 "peak oil" will bump into (1) the declining value of our dollar, (2) projects delayed by the current shortage of demand for oil, and (3) a rebounding U.S. economy to produce what will be called a world-wide shortage of oil and energy.  Short of a new war, ENERGY may finally get the attention it deserves.

If sanity prevailed we would see an increased use of electricity versus other forms of energy and increased production of electricity from coal, natural gas, nuclear, and wind energy.   However, sanity will not prevail in the short-run and instead we will see only significant investment in natural gas (supplemented by LNG) and wind power.  Solar will increase also, but we will struggle to supply 5% of  our needs in my lifetime. On the flip side, there is plenty of room for more energy efficient in air conditioning, building design and for more efficient autos.

 I look at all of this reaction to global warming as a move in generally the right direction for the wrong reasons.  There are some more fundamental problems in our world economy that we are not addressing.  The American Consumer has been the driving force in the world economy for the last forty years.  However, the American Consumer is also the American Worker.  His cut of the pie on both a national and international basis has been declining ... and in the last ten years it has been declining substantially.  Availability of excessive credit allowed the American Consumer to spend more than the American Worker made for over a decade, but that party is almost over.  Improved education of our people can possibly stabilize the decline in the fortunes of the American Worker on the long haul, but another driver for the world economy needs to emerge in the short and intermediate term (0 to 10 years).  Dealing with the upcoming energy shortage could be the driver for the world economy, perhaps, but that seems a little like trying to apply a force with a wet noodle.  Instead, they are parallel problems with solutions needed for both.

Some argue that the Chinese, or Indian, or South American consumer will become the drivers for the world economy.  The current public opinion is that the government is going to be the "driver" in the short term -- now that is a scary thought that I won't go into at the moment.  But, this way of thinking is based on an old model of how the world's economies work.  I am not sure how all of this going to unfold, but whichever countries most sucessfully deal with rising energy requirements as traditional supplies shrink will own this century.  Yes, it is that big.  The consumer dependent model where everyone tries to convince the consumer that he needs what they are selling is near the end.  The new model will address obtaining energy and using it efficiently.  The retail industry will be hit soon and hard by this new reality.  Engineering services, both on the industrial and even for homeowners, should flurish as this new reality emerges. 

This entry is more to introduce the concept than claiming I have it all figured out yet.  Writing is my way of sorting through this messy subject.  Any comments to add clarity to my mind would be appreciated.

Gaza and Hamas

Today Israel sent computer guided rockets into Gaza to destroy Hamas strong-holds.  The hospitals were filled with the wounded and dead.  Israel suffered one death yesterday from a Hamas rocket into their territory.

Israel reportedly expects this to stop the rockets from being launched into Israel.  Instead, Hamas is calling on its fighters to step up action against Israel anyway it can. Israel in turn will continue keeping Hamas and all the Palestinians as prisoners by restricting travel of goods and people to and from the Gaza strip. In short, the cycle will repeat itself over and over again.  Why, because both sides are interested in establishing blame -- identifying who is right and who is wrong.  It is about revenge, not finding solutions.

Sometimes you have to do what is right despite of the consequences, not because of the consequences.  For Hamas that would mean they have to stop sending rockets, which are largely ineffective, into Israel.  This is hard since the blockade that Israel has imposed is effective in keeping the entire population in poverty.  It restricts trading, access to jobs, and even access to food and fuel.  From Israel's viewpoint, it restricts access of suicide bombers, people who care enough to die (or are brainwashed enough to think they do), to their families.

The Hamas stay in power by feeding off the hatred that Israel's actions cause.  Israel politicians stay in power by feeding off the fear that Hamas's actions cause.  Fear and Hatred.  Hatred and Fear.  Hatred of those in power spurred by the abuse of power.  Fear of those who are oppressed biting the hand of the master.

How do the Palestinians see themselves.  Watch this video : Palestina Video .   I don't understand a word that is being sung, but I understand the video.  From their viewpoint, they are brave people fighting against an enemy that has overwhelming power, power to suppress and control their lives.  The children throwing rocks against the tanks, the children crying next to their slain parents -- these are the fighters of tomorrow.  One could not develop a program more effective in producing fighters against Israel if they tried.  Israel and the United States have devised the perfect system to promote hostility and hatred forever.

Ok, this Feud is not going to end of its own accord.  The powerful, Israel and the United States, have to lead this initiative and stick with it despite the increased deaths of Israels that will result initially.  I know, not likely.
Israel must do the right thing with the vast majority of Palestinians despite the opportunities that this will create for the minority of Palestinians that cannot see past their hatred.

Two initiatives are required by Israel.  The first a practical matter - restoring more mobility and economic trade with Palestinians.  A full belly does a lot toward promoting peace.  The Palestinans need more freedom and improvement in their economic condition.  Israel needs control.   Here is how it is done.  A national ID card for the Palestinians and the Israel's.  It can not be one sided or the cards will be used like they were against the blacks under aparthie in South Africa.  The blockades will be replaced by fences and gates.  The gates will be monitored not by soldiers with guns but by a plastic card, or even better, a plastic card and retina ID system.  People that want to travel across the border, Israels or Palestinians will have to sign up for cards and get their retina scanned -- including Israeli soldiers.

Of course, the cards give Israel the chance to gather information on the Palestinians.  And, I doubt that a Hamas activist is going to sign up for his card.  But, it gives the everyday Palestinians the opportunity to travel inside of Israel to make a living and bring goods and services back into Palestine.  Fully belly approach to peace.

Now imagine, half of the Palestinians have a card.  Now imagine a new peace initiative put forth by the Israels.  Imagine voting booths were the people holding cards can cast a non-binding opinion on the initiative.  Of course, I suspect that their first vote would be against any initiative.  Imagine they could say on the same machines what they really want.  Imagine the tenth initiative getting a positive vote from the Palestinian card holders.  Imagine the weight that would bring to the negotiations on both sides.

Yea, there are a lot of problems with making this work.  But, it is a new direction and active approach toward freedom.  Yea, it would cost millions.  Guess what, the cost of the present situation is incalculable.  This requires the Powerful to give us some control and overcome their fear.  This requires the weak and suppressed to hold back their hatred and to hope for something better.  Maybe this can't be done, but I am one for trying new approaches despite past failures.

Two Trillion in New Debt

About two trillion in new debt is expected before we are finished bailing out America.  Of course, by America, we mean big banks, big companies, etc.  Do we mean the little man on the assembly line.  No, we mean shareholders and executives.  Mostly executives, since most shareholders, i.e., Americans have already lost their shirts through their 401K's.  So, mostly the powerful are saving other powerful people for the good of America.

Another $200 billion was just announced to prope up the Fannie Mae, etc., the mortgage market.  Again, are we talking about the home owner.  Not yet, right now we are talking about the government banks.  They are also pumping more money into credit market.  Both are supposed to make it easier to borrow money, to extend credit to more Americans.  So they can spend more and prope up the economy.  Guess what, Americans are broke.  They have already spent more than they had.  Instead of this quick fix, we have to find a way to increase the earning of Americans, not just give them more rope to hang themselves with.

There is no easy way or quick way to do this.  Education, working smarter, and laws keeping the fat cats from paying themselves millions while the company they manage goes down the tube, eg., Lehman Brothers. Or the big auto companies in their corporate jets and fat wallets.  If the company you are leading is even thinking about bankruptcy and you have been their boss for the last few years you do not deserve a golden parachute, a bonus, or a fat salary.  They should suffer with the workers, if that is even conceivable in their world.

The net effect of all this spending of the money we don't have, even though it is the government.  You can't cheat mother nature, or economic law more appropriately.  The dollar at some point will start falling, rapidly.  It would be good at that time to own some gold bricks.  Oh yea, I forgot, owning gold bricks in America, land of the free, is illegal.  Wonder why?  I am not sure if owning stocks in gold companies, or black gold (oil) companies will be quite the same, but it will be better than cash at some point.  The money, the trillions, has not hit the streets yet, but it will and bread will hit the ceiling.  Wait and see, its called hyperinflation.  In my mind, I don't understand how we avoid it.

Capitalism Does Not Always Work, Witness Richard Fuld

Capitalism and free markets do not always work.  Witness the recent financial melt down.  Over stretched homeowners lose their shirts when energy prices became the proverbial straw on their back.  But, the hedge fund operators who made leveraged bets on the home owner walked away with gold parachutes.  Lehman Brothers CEO, Richard Fuld, made $480 million..  Now I thought capitalism was supposed to reward those that do a good job.  Obviously, since his company crashed and both shareholders and homeowners were damaged by his leadership, he did a sucky job.  Walking away with that much dough when his judgment cost others their homes and livelihood should make him feel bad.  It should have made him want to work with homeowners in trying to sort out which ones with a little help could have been saved.  But, guess what, I bet he didn't even try.

It is simple, being apart of the good old boy club that runs American companies has little to do with being good.  There are hundreds of smarter and more capable people in every single company than there are slots in good old boy club.  So, how do you get in.  It is more like getting into a fraternity than getting a job.  In short, others in the club have to let you in.  You are tested first.  You have to show that you can make money in your own right, take one for the team, and sometimes  do the dirty work -- like laying people off after the good old boy club screws up.

In capitalism, money flows in a circle.  Plants makes stuff, pay workers, workers buy stuff.  When those at the top, or anywhere else, suck too much money out of the system, by say diverting money to fat salaries that are not earned, see above, then workers don't have enough money to buy all the stuff from the factory and then the factory has to be slowed down and workers get laid off, etc.  Downward spiral.

Emotions have always be part of the market place.  But, markets have been always been protected by a lack of information and different information flowing to everyone.  But, now we have emotions on steroids, its called the internet.  Global panic in one day, in one hour is possible.  In process control, it is like a feedback loop with the gain turned up to high -- look it up.  It means panic feeds panic.  Like when you get feedback with you call into a radio station and then stand in front of the radio and talk.  Try it.  That is what is happening  now in the market place.

So now, our wise leaders, are going to get us out of all the problems by spending money.  Spending money we don't have, which is very similar to how we got into this problem, by spending money we, as a people and a country, did not have.  We borrowed it, either from a bank, or China, etc.  So now, our leaders tell us, we are going to get out of the problems by spending more money we don't have.  And where did they spend the first pile of money, to the broke homeowners.  Nope, to guys like Richard Fuld.  That makes me feel better, I am sure they care.

Anyway, perhaps you are starting to see that all is not okay at the big corral called capitalism, or free trade.  Well, really this is not free trade or capitalism.  What we are seeing here is another example of an age old principle, those with Power abuse their power and hold onto it.  The vehicle of that power is often money as it is now, but that will be another blog.

great for america

Black man makes good, which is good for all of us. It is one small
step toward seeing everyone for the strength of their character
instead of the color of their skin. Ok, that concept came from Dr.
King's I have a dream speech, but I agree.
I told people before the election that I was voting for him because he
was black. People not voting for him felt obliged to tell me that
they were not prejudice. I would say I am not voting for him despite
the fact that he is black, I am voting for him because he is black.
Of course, that was an over simplification of my views, but I was
trying to make a point.

Bankruptcy in Amercia

There is only one thing keeping the good ole US of has been's from being bankrupt:  The world's currency is the dollar.  We can't go down without pulling the world down.  10 trillion dollars.   10 trillion dollars.  What are we thinking. What happened to the Republicans who watch the budget.  Oh yea, Jevohah Bush and Holy Ghost Chaney.  What is American thinking.  We are fighting a war we can't afford.  We are buying energy on credit.

My daughter tried to apply for a loan to pay for college.  No loans for college.  What is America thinking to let college costs get away from us.  This is our children's future.  The democrats can't get off the hook either.  They are spending just as fast as the Republicans.  However, you just have to pick one to punish so they get the point.  I suggest the Jehovah Bush party.  Besides, I don't want Pallin learning on the job with the world going down the tube.

There is only one thing I don't understand, well, one thing that is obvious to me, that I don't understand is this: why is the world, especially China and the Middle East Countries (with the possible exception of Saudi Arabia) loaning us -- Amercia the broke -- more money?  And, who else has money to loan us money.  India, a few other Asian countries perhaps, but who has the kind of money that we need to borrow.  Who is buying up the U.S. Treasuries.   Who still thinks our money is as good as gold.  Is this global delusions?  I don't get it.  We are not good for it .... We are broke as credit card laden Americans and as a war broke country.

Let the Vengence Be Mine, saith the Market

Financial panic.  The only thing we have to fear is fear itself.   Despite what everone is saying, the only thing that can cause a financial collaspe is if the public, the American Public panics.  In past crisises, it is the American Investor that has remained calm and considered the panic of the few the time to buy stocks.  The key word is the panic of the few.  

Our President, Jevovaha Bush, has not done a good job presenting his recovery package.  Can someone please tell me exactly how it is going to work instead of "if we don't do this the sky will fall speach."  

My solution is simple.  Give anyone with an adjustable rate mortgage the option to buy a 3% fixed rate loan for five years from Uncle Sam.  At the end of that time, they have to arrange for a new loan, well after the panic, under whatever terms they can negotiate.   Fix the core problem, the banks will stop bleeding, and the strong will survive.  

Second, raise the amount of money insured in a bank from $100K to $250K.  

Aside from that, deal with each bank with the Fed on a case-by-case basis just as we have been doing.  Let the bigger and healthier swallow the weak.  

I need to understand why this simple approach will not work before I will personally support a bailout of banks and institutions that screwed up.  Let the vengence be mine saith the market.

Inexhaustable Wealth -- The Ultimate Delusion

On 9/27/08, michael odle wrote:hey dad haven't heard from you in a while.. i guess i have been using the old expression "no news is good news" , but i thought that i should check in and see. Specifically how you are, how julie is.. and a general curiosity about some reflections you probably have about the current financial market. Julie said she was going in for a biopsy? when i talked to her last. I thought perhaps the results might be in by now. our area has had some problems getting gas. they say that it is because of some supply issues that are directly linked to our area, but it isn't clear to anyone that i talked to what is really going on. none of us really think about it unless we can't get it all of a sudden. I saw lines fifty cars long waiting at a gas station, and people looking quite lost and confused trying to figure out what was up. we have been up on the mountain all week, and luckily there is plenty of food right now being grown around us that i just go shopping at my neighbors. i think it will be over soon. i just hope this isn't some test plot to see how people react to gas rations. seems like whether it is intentional or not it would be good to take a look at how people are doing around here with this type of constraint. i imagine you are busy like us. hope it is all manageable and that you are able to stay healthy. hope to hear from you soon


Mike, I think the gas shortages you describe are from the damage done to the refineries in the south (Houston area) from the hurricane. However, it under scores the fact that we are very tight on refinery capacity. And why don't the oil companies build more refineries, because the world is tight on oil capacity. And, we are short on energy in general.

The current financial problems have been a long time coming and they point to some severe problems in our economy. We are in debt both as individuals and as a country. We have a lot of money and move it around a lot in schemes to make more money. But, a lot of the apparent wealth was built on selling more to the American consumer than he could actually afford. Our government has built a military force on money borrowed from foreign governments (almost 10 trillion dollars); about one trillion from China. The whole economy the last ten years or so has been built on debt. The stress of the energy crisis is now washing that foundation out from under our feet.

The bailout being planned by Congress to save our financial system, or some of it, is a popular move but it actually adds a trillion dollars to the debt we already have and already can not afford. There is a group of conservative, old school, republicans who are for now trying to stop the insanity. For capitalism to work, it must be able to punish those that do stupid things. In this case, there are a lot of guilty parties to punish and a lot of innocent people in the path of the potential destruction. The bailout attempts to spread the pain to everyone instead of completely wiping out a few institutions and its employees and shareholders, etc. Julie's dad gave us a few thousand dollars about ten years ago in Washington Mutual, a firm near bankruptcy that the Feds allowed to be swallowed up by Bank of America without the usual review process. What happens to our money, I don't know. Multiply that by hundreds of thousands of people equals a lot of pain.

Constellation Energy, where my friend Al works, just got bought up by Warren Buffett for almost nothing. Why, they got caught in a credit crunch. They didn't have enough money to run their business on a day to day basis because they could not borrow cash from banks paralyzed with fear. Warren Buffett believes they are a fundamentally sound company who just did not manage their cash well, and/or depended on too much on one bank, who through no fault of Constellation, was in trouble.

Hey, the housing market is what made the mountain crumble, but it is just a part, a big part, of debt our country could not afford. We are under the illusion that we are a rich nation, richer than we actually are. Until that fundamental illusion is shattered the problem can not be fixed. We can not afford the path we are on. Another example, we can not afford our military and/or Iraq. We can afford SUV's, and driving all over the place at a whim. We can afford our big houses and big heating bills, etc. Our illusion of us having great wealth is shared, up to now, by the world. And, we still have a lot of wealth, just not as much as we think we have, hence debt.

How do I think it will come out. Well, I think it has to get worse before we wake up and get rid of the illusions. The private sector is already making adjustments as fast as it can with the resources it has. Hundreds of billions are being spent in Texas on wind farms. Investment in solar power companies is through the roof. Car companies are scrambling to apply and develop technology to improve gas mileage and convert to electric cars. Applications for nuclear power plants are off the chart, 15 applications are currently under review, ten times that many wait in the background. Research on making ethanol from grasses and other feedstock less valuable than corn are being developed. Private industry can not address other issues like mass transit on its own, that needs some government direction. It can not address our screwed up medical system on its own, that requires some government recognition of the the problem and some rule changes.

The only sector that is not on board to address energy and debt problems is the federal government and most state governments. Their general plan at the moment is to give more money back to the consumer / taxpayers, tax business more (the same ones we need to solve the energy and other problems), and spend money like there is no consequences of spending money they don't have. Both Republicans and Democrats are guilty and sadly, they may reflect the will of the people who share the mass delusion of great and inexhaustible wealth.

The delusion has to die before we can allocate our resources better to solve social, energy, and infrastructure challenges in our country. We are still rich enough and resourceful enough to pull ourselves out of the quagmire, as quantified by our debt, but we have to get rid of the delusion first. We need a Perot-like person on the scene. Ron Paul is the closest one I've found to the positions expressed above, and more that I hold, but he is not wise enough to keep his more radical views to himself and concentrate on what can be done, instead of what the ultimate solution would be in his mind. ( I think I am going to put this in my blog, with your questions as lead in. Too much good stuff to waste it.)

Thanks, I needed that .... I love to write my thoughts down ...


Dad

Debt and More Debt

I just pulled a beer out of the freezer and opened it and then immediately took a swallow.  It entered my mouth as a liquid and then turned to solid ice.  Now, that is a cold beer.  All beer lovers would be jealous.  I can explain this from nucleation theory, but who cares.  It was a cool, once in a life time experience, I suspect.

Well, what is happening in our financial markets is not so mysterious.  Why is "what's gone wrong with our economy" such a great mystery that needs a lot of explanation.  We are nearly 10 trillion dollars in debt in this country.  We are spending a half trillion dollars a year that we don't have in Iraq.  Our social security system is near bust.  GM owes more money to retirement funds than it has.  Our energy bill is going through the roof.   As a country, we are near bankruptcy, not financially yet, but bankruptcy of the spirit.  As a country and as individuals we are seriously in debt, but we are not at the end of our rope.  Our country owes about one year of its income (GNP) in debt.  High, but not undoable.  But, the problem comes in that we do not recognize the economic realities.

First, as individuals we bought more than we could afford.  The Fed passed out cheap money and we bought homes we could not afford.  Not very profound.  Ok, go punish the guilty, but that won't solve the problem.  We have to suffer through the pain, but we will get through it, lower house prices and all.  They will go back to the normal 10 to 12% a year increase.  Usual stuff, they will return to the least square line increase, etc.

We can not afford the war in Iraq.  Period.  Don't worry about what will happen to Iraq if we pull out too soon.  Worry about what will happen to us if we don't do it soon, very soon.

Energy.  Wake up, America.  Energy costs are pulling us down like a concrete weight around the leg of a man thrown overboard by the mob.  Conservation, nuclear, alternative, free market, etc. nothing profound required here, just let the American entreprenuer be free.  Get rid of tarriffs on ethanol, don't penalize oil companies for making a profit, expedite environmental permits for new plants, fund clean coal incentives, raise cafe (car mileage requirements) limits, improve the grid (for wind power), and reward efficiencies improvements.  More on these later, tonight is a very simple run down of the basics.  Too much debt is bad.

Isolated in our Wealth

This week we found out my wife had an aggressive form of breast cancer. I told one neighbor who told two more. We live in a neighborhood with about 30 houses. Guess what, the circle stopped there. A neighbor only 50 yards behind my house didn't find out. Growing up, the circle of knowledge would have spread quickly through our neighborhood. Of course, in the modern world, such news is spread by FB or email.

And of course, their sadness was conveyed to us by email. Some very kind words for sure. My wife has a lot of friends. Some of them called.  Some of them send emails. But, not a single one just dropped in. Some of it is because we moved all over the country chasing money and ended up alone in the middle of nowhere. Some of it is because we no longer know our neighbor because we just moved into the neighborhood and so did they. Some of it is because we work so much to buy so much stuff that we don't have time to enjoy our stuff, much less to get to know our neighborhood. We have been dubbed.

Americans are isolated in their wealth. People in the middle of Africa have more interaction with their neighbors than we do in this country. And we do interact, it is superficial and proper. Very seldom are any serious subjects discussed. It has not always been this way. When I was young, we cared about right and wrong, and politics, and religion and we were not afraid to debate it. And guess what, we didn't offend each other all that much. We wanted to know what was right. Now, we have more wealth, but since the pursuit of truth is not profitable its not on the agenda.

America's Berlin Wall

Guess what. We are in a small group of countries that include North Korea. We are one of the few countries in the world that tax our citizens when they are abroad. We tax them, the country they live in tax them. The only way around it, give up your U.S. Citizenship. Of course, a new law just passed by Congress and approved by the President, says that you have to assume all your worldly goods were sold and then you have to pay capital gains tax on it, before you give up your citizenship.

So, if we have a young person that wants to go abroad and learn. First choice, he can pay double taxes or he can give up his citizenship. That is freedom. Land of free, home of the brave. That is complete crap. It puts our country at our a disadvantage, and it puts our youth that want to learn at a severe disadvantage. It says, go learn, but give up your citizenship and don't come back.

Where the hell do we come up with such ideas. It is because 99% of Americans do not even know about these laws. And for the few that would agree with such laws, they live in a dream world where everything good comes from America. Wake up, those days are over. We are in a serious economic battle for survival and we act macho and stupid as a country. Wake up. We need to go abroad and learn.

In the old days, when I was young, 99% of technology came from America. Then we sent manufacturing plants overseas. Guess what? For one generation we lose jobs when we sent manufacturing overseas. The next generation, we lose expertise.

Extractive Metallurgy, when I was young, U.S. was tops. We had the expertise and the smelters and refining plants. In the 70's, we quit building plants here. Ore grade too low, labor too expense, and the greenies decided it was too dirty. Well, the planet was not served well. Dirtier plants were opened up all over the world. The jobs left and then the expertise. I am the last of the kind, the end of a long line of metallurgist in the U.S. Where there are no jobs, there is no expertise and there are no future jobs. It is an industry we chose to abandon. We have done the same thing with oil. Only drive on foreign soils, only off the coast on foreign soils. For now, it is still our companies doing the exploration, the drilling. Exxon is at the lead. Next generation, starting in about ten years, guess what the expertise will be overseas and they will be sending their engineers, their experts, to drill in a third world country call the United States. We live in a dream world, a world that existed a long time ago when America was great and free.

Freedom - Land of the Free, Home of the Brave

What Does Freedom Mean

It means the right of the individual to chose his own course in life as long as it does not harm his neighbor (significantly). I add "significantly" since every human in some way or another competes for resources in a resource limited world, so some harm might be done even by being a life -- although not necessarily if one believes it is the sum total of what you do that counts. Anyway, we all get the definition.

What Does Freedom Mean in America

Well, it doesn't mean you can buy a Miller on Sunday in South Carolina. It doesn't mean that we tolerate third parties or make it easy for them to register, much less exist, in America. It doesn't mean you can smoke pot, even for medical reasons. It doesn't mean you can pull your kid out of school and expect to get your tax money back that you paid for the education, even if you put your child in a private school. Sweden, a socialist country, by the way lets you do this -- so, by this standard they would be more free. Freedom in this country does not mean that you can choose to redirect your tax money that is being spent for the war in Iraq. Until recently, it didn't mean that you could get a trial if you were declared an enemy combatant, or even a terrorist. Freedom doesn't mean a sixteen year old girl has the freedom to make love with her 19 year old boyfriend, although sometimes its okay.

Speaking of sex, freedom does not mean that you can buy a woman to have sex with you. Its okay if you spend enough money on her and she feels obligated -- no, not really -- but there are no laws against the latter. Freedom does not mean that you can have two wives or two husbands. Freedom does not mean in most states that you can marry someone of the same sex.

Freedom does not mean you can gamble in most states or send off fireworks on the 4th of July (your safety is at risk, man). Freedom does not mean that you can opt out of social security and take care of your own retirement.

Freedom does not mean that you can chose to end your life, even if you are suffering and death by natural means is certain. Freedom does not mean you can help a loved one who is suffering to end his life.

Why am I not free to buy a Miller before noon on Sunday in Az

Why not. Because, some Southern Baptist decided it was wrong, or at least in my best interest not to buy alcohol before noon on the Sabbath (actually the Sabbath is Sunday, but you get the idea). Buy the way, it is okay with me that the Southern Baptist is in church on Sunday and not buying up all my Millers. Why am I not allowed to do all the things on my list above ... why don't I have the freedom to smoke pot or end my life if I chose to? Religion. More specifically, self righteous religion. Religion that says I know what is right and wrong for myself and you.

Democracy or Religion

I would guess that the majority of Americans would say that it is OKAY to buy beer on Sundays (SC) or at least Sunday mornings (AZ). But the majority does not count. Yes, in this modern age, we could take a vote on almost everything and let the majority decide. I suspect that it would be a great world. But, we do not really believe in Democracy any more than we believe in freedom. You see the definition of freedom is not really what I defined above. There are at least two other definitions.

Freedom by the "Religous"

Freedom by the religious goes something like this ... Freedom is the right for an individual to chose his course in life as long as it does not violate any of my moral principals.

Freedom by the Military Industrial Complex(MIC)

Freedom by the MIC... Freedom is the right for an individual to chose his course in life as long as it does not detract from our right to profit from waging war.

I Believe in Freedom

I am one of those rare birds that actually believes in Freedom. See the list above, I am okay with all but one of the items on the list above. And, if the majority in our country thought that something was okay, I would 99% of the time go along, because I also believe in democracy. I believe in the majority, I believe in people, I believe in individuals. I try my best not to judge what someone else does, especially when it has no direct impact on me or on others .... which is almost all of the time. America, and most of the world, fears freedom. Yes, we fear freedom. We imagine a world gone mad if we give it too much freedom. Its like the fear of capitalism that China used to have.... they imagined chaos if everything was not controlled.

For example, we are afraid that if we let everyone that wanted to smoke pot, actually smoked pot, that the world would disintegrate into a drug orgy. We don't trust our fellow travelers through life. We are okay, but those around us are not to be trusted. It is religion, on a one to one basis. Religion assumes that a specific group has a monopoly on truth, that the group knows what is best, best for itself, best for you. On a one to one basis, we believe that we could handle something, but the average mere mortal could no handle it. And if we fear that we could not handle it, then for sure mere mortals could not handle it.

We want an ordered, protected environment, free of freedom. We fear freedom, not only for others, but for ourselves. We are not ready for freedom.

Energy Reality

America, wake up. This is not the seventies. You are not going to wake up tomorrow with a full gas tank.

Peak oil. We have talked about that before, because of the political and technical problems facing the oil industry, many believe the world is near it's peak of oil production. I am a big believer in this concept, but I just learned a new concept that I believe in even more.

Even if the production of oil continues to increase (a very big if), the increase in the oil exported will probably decline. Why, because the countries that are exporting are using their riches to build up infrastructure, subsidize gasoline and energy prices in their own country, and build a middle classes. Guess what, these new middle classes are buying cars and homes and consuming energy, which leaves less oil to export, which drives up the price of oil, which brings them more wealth, which increases the middle class, etc. You get the pattern. Well, the amount of oil being exported is in serious decline. So if you don't believe in the peak oil theory, perhaps you should believe in the decline of exported oil theory. The facts on this are pretty clear.

When you accept the day of the oil gorilla is over, we will start talking about life after the big oil gorilla.

Next time. Thorium. It has the potential to be the next energy gorilla.

America - A Stupid Period

A friend of mine from China asked me if America's strategy was to save their off-shore oil while they consumed the oil from the rest world -- presumably until oil got really expensive, like $1000 a barrel. Well, if we are that smart, it is a well kept secret. On the outside, we are going through a stupid spell in America.

We want to blame everyone for high oil prices. Blame is something that people do when they don't want to deal with reality. Guess what percentage of the oil in the world is controlled by private oil companies like Exxon. Hint, 10%. Of course, our friends in the Middle East, Russia, Kazakastan, Venezula, Mexico, Norway, and Canada, etc. control the rest. Guess what, we are short on friends on this list, especially the ones that really have any real oil reserves left.

Does that mean Exxon et al are dealing with reality better than America in general. Yea, they are trying to make a buck, two ways: one by being the most efficient oil company on the planet, and two by cannibalizing themselves (stock repurchases). Of course, somehow this comes out as greed when their profits for this success is viewed by Americans, especially politicians like Old man McCain, promise everything-Obama, and witch Hillary.

But, Exxon has a blind spot, too. They have been the best at "oil technology." But, the "oil age" is ending. Exxon dreams of the U.S. opening off-shore and national park drilling and her glory days returning. Ain't going to happen soon enough or fast enough for the glory days to return. Meanwhile, Exxon waits eating itself more of itself every year. There is an alternative -- one that Exxon and America have not chosen.

If Exxon could figure out where the future Energy was coming from instead of moaning about the good old days, they could start spending their money to go there now. Is that the best use of their money from an MBA, maximize the dollars viewpoint. Nope. What they are doing, is the best route for now. But if Exxon, and to a lesser extent, America is to have a tomorrow, we must answer where our next breakfast of Energy is going to come from ...

Earth Quake in China and Protests

Today the police took away about 100 parents of children lost in schools that collapsed from the earth quakes. It is reported, they wanted the search to continue until all the bodies were found and that they were unhappy with the sub-standard materials of construction used in the schools. The Chinese government has been more transparent and open than normal during this crisis and they have made a big effort to deal with a difficult situation.

It turns out that they are still uncomfortable with protests. Also, since the Chinese government assumes the role of trying to take care of their people, and even tell them what that means, having them complain -- to have them have a mind of their own what is right and wrong -- pretty much flies in the face of the concept that the government knows best.

In the U.S., a private company would have built the schools. Hopefully to a better standard, but if they didn't (or even if they did) they could be sued. But in other ways, it is not that much different than in the U.S. Guess what, when our government screws up, they can not be sued. Not much different than the position the parents of the dead children in China find themselves. And, of course, the grief is the same.