The ramblings of an Eternal Student of Life     
. . . still studying and learning how to live
Monday, April 28, 2008
Politics ...

Me and some of the other political junkies at work have plotted out a strategy for Barack Obama’s fall campaign against John McCain. Using the on-line Electoral College calculator, we figured out that Obama has to hold all of the states that John Kerry won in 2004, and regain Iowa (which Gore won in 2000), and then pick up either New Mexico (which Gore won) or Nevada, plus Colorado. We’re pretty sure that McCain is going to take Ohio and Florida, so we’d give up on those states. But Iowa seemed impressed with Barack (they got him going with his caucus victory back in January), and New Mexico, Nevada and Colorado have had significant growth in their Hispanic populations, which might swing Democratic. So, it looks to us like Hispanics in the central West are going to be the pivotal voting group this November. Which means that Obama needs Bill Richardson as his running mate. Richardson, Governor of New Mexico and a Latino himself despite the Anglo last name, probably guessed as much when he betrayed the Clintons last month by endorsing Obama. Bill can obviously do the math himself.

So the critical state to watch on Election Night will be Colorado, assuming that Iowa falls in line for Barack and that McCain doesn’t pull an upset in Pennsylvania, Michigan or Minnesota (which is not impossible). If Colorado goes for Obama, then Richardson’s New Mexico could seal the deal (with Nevada as backup if McCain’s popularity in Arizona somehow seeped eastward). Interestingly, there are at least two “not entirely unlikely” scenarios under with Obama and McCain would gain a tie in Electoral College votes; first, if New Hampshire go for McCain (recall that Gore lost NH in 2000, and McCain seems popular there) but Colorado and New Mexico or Nevada go for Obama; and second, if New Hampshire, New Mexico and Nevada go with Obama but Colorado stays Republican.

What happens then? Well, the Twelfth Amendment would suddenly become a very popular topic. Basically, the US House of Representatives would select the winner, based upon one vote for each state delegation. I’m not entirely sure, but I believe that 26 states currently have a Democratic majority in the House. If this holds, Obama would win. But this is still a bit shaky, as the vote would be taked by the new Congress elected in November, not by the current one (as the Electoral College needs to go thru the motions in December and early January). Two of the states that are currently Democratic have 1-person delegations; ironically, those are North and South Dakota, which both tend to vote Republican in Presidential elections. Both Reps are up for re-election this November; if one state swings GOP (South Dakota’s Rep. Stephanie Herseth Sandlin is said to be vulnerable), or if another state’s delegation shifts into a tie, then the state-by-state vote in the House could also end up tied.

At that point, things get pretty weird. Even weirder, the Senate would choose the new Vice President, based on a majority of Senators. If the Democratic majority in the Senate holds, then we could have a Democratic VP before we know who the President might be. But as to who would be in charge, well – the confusion following the 2000 election (and the current confusion in the primary battles between Hilary and Barack) would seem like just a warm-up act. This could get interesting!

SIDE BAR: It’s also interesting that two of the four states that begin with “New” will play significant roles in the November election. That made me think about the tradition of naming a state or a city after another place while using “New” as a prefix. I wonder if this is mainly an American thing, given our historical identity with being a “new start” relative to the stodgy traditions of Europe. From what little I could tell after consulting a world map, there don’t appear to be too many “new” cities or regions in other nations. There are some, e.g. Novo Sarajevo and Nowa Huta and Nueva Ecija, and New Zealand of course, but not that many. The idea of newness just doesn’t go over everywhere. Wonder if there’s a “New Persia” somewhere in eastern Iraq?

◊   posted by Jim G @ 7:27 pm       Read Comments (2) / Leave a Comment
Sunday, April 27, 2008
Religion ... Web Site/Blog ...

One way to break the world of blogs down is to separate it into spectators versus players. In other words, some blogs talk mostly about the writer’s actual experiences in life, be they in business, family life, school, hobbies, religion, science, sports, whatever. Other blogs are based on observation, like a sports writer talking about football or baseball. Sports writers talk about sports, but they don’t actually play them. And many blog writers – myself included – talk mostly about stuff that we’re interested in but don’t really do. There probably isn’t a clear distinction; the direct participants make general observations, and the observers (including myself) sometimes talk about our own experiences. But in general, I think that you could classify blogs as mostly observing versus actually doing.

And as to which is more interesting to read, well – that depends on your own tastes. Direct experiences may be really interesting if you are involved in the area; a blog written by biochemists discussing their research would certainly be of great interest to other biochemists. Likewise, people raising kids probably enjoy reading about the experiences of other people raising kids (and may benefit from it, may get a good idea here and there). Same for playing softball, homebrewing beer, tending a backyard garden, maintaining a home computer, etc.

As to observations, that’s a tougher sell. Punditry can be a tough field. Not everyone can come up with sharp insights and present them in a timely and interesting fashion. Being a bit of a current affairs analyst and a political observer myself (and not a participant; I have no interest in going door-to-door or handing out literature at a bus-stop for Hilary or Barack or some cheesy local candidate), I can’t help but envy the immensely popular and often insightful Tom Friedman. But not so much Ariana Huffington; no real envy there on my part.

For better or for worse I’m going to keep on writing as I’m able about politics, religion, science, current trends, economics, and whatever else I have thoughts on. This is even though I have very little actual experience in these fields. I’d talk more about my actual life and job, but it’s all pretty boring. So I’ll continue throwing out random thoughts from my perch as an interested observer.

I have an observation or two today about religion. (I used to be involved in religion, but now I’m not.) The first observation is about the general role of writings and scripture in religion. I wanted to take note of what an under-appreciated subject that is! I came across a quick discussion about it recently, and it turned a lightbulb or two on inside my mind. It’s the kind of thing that a handful of religious studies professors and sociologists discuss now and then, but it doesn’t make its way out into the realm of popular thought. And that’s a shame. Religious people would benefit from some “meta-think” about their religion. (Especially since this is often discouraged by their religious establishment – i.e., don’t question us, or you’ll go to hell).

I’m not ready to say very much about books, writings and religion, but I do want to make the point that they do not necessarily go together. Having grown up in the Catholic faith, that notion comes as a bit of a surprise to me. But if you look at history, there were religions that didn’t depend on things being written down. Also there still are religions that don’t depend on “sacred scripture” to the degree that Christianity, Judaism and Islam do. For instance, Buddhism and Hinduism don’t really have “core canons”, although there are plenty of ancient writings that you can consult about them (e.g., the Upanishads or the teachings of the Buddha). And even the “people of the book” (Christians, Jews and Moslems) make somewhat different uses of their sacred books.

In general, the idea of writing down religious stories and laws helps to standardize things and to promote common understandings behind the religion. As such, this makes it possible for power structures to form. These powers-that-be control the sacred writings and spell out how they are to be interpreted. There are pros and cons to that, depending on what you think about heresy. Another dimension to the question of scripture is the historical one, regarding the availability of paper, the development of the printing press, and the number of people able to read. Given the rise of literacy, writings became somewhat of an evangelistic tool (although relatively few people join or convert to a religion solely because of what they’ve read about it; despite C.S. Lewis, it’s usually direct experience that clinches it). Writings also allow high levels of abstract thinking about religion, which was necessary in response to the rise of intellectualism after the Middle Ages.

But on the other side of the coin, too much dependence upon writings can choke off the experiential side of religion, which was prominent way back in the days when religion was mostly an oral tradition. In Latin America, Catholic Christianity is today being challenged by Pentecostalists who pledge fealty to the Bible but who otherwise throw out the writings and provide their followers with a lot of emotional experience. The bishops can condemn this as a dangerous heresy, but it seems to meet the needs of a growing number of people.

That leads me to another big thought about religion, another idea that should be more popular than it is. That thought is called the “rational choice theory”, which has been promoted by an academic writer named Rodney Stark. According to this theory, most people don’t choose to become or remain involved with a particular religion because of doctrine (although the more educated crowd, e.g. the Episcopalian – Quaker – Unitiarian Obama supporters, sometimes do). They get involved because it’s a good economic decision.

I like this theory because it gets down to money. The reality is that money is never beside the point when it comes to religion. If you just want to just go to church on Sunday, maybe you could get away with that on the cheap. But most people get involved with religion for more than a weekly ceremony. They want a bundle of services including help educating and socializing their children, and otherwise tending to their needs be it sickness, old age, unemployment, psychological problems, etc. They also want community, a feeling of belonging. They also want to “give back”, to volunteer their energies in a meaningful way (i.e., this is another service that has economic value).

And after that, they want some transcendence, the affirmation of a “philosophic ontology” whereby the Universe was created by an all-powerful God who cares about us, with some catches (and that’s where the scripture and writings come in). Transcendence comes easy when you are in the middle of a large assembly of people all chanting together the sacred ontology. The fears of doubt are easy to ignore when hundreds or thousands of others are within a stone’s throw of you affirming that it must all be true. That also has economic value – it’s something that people are willing to pay for, through “time, talent and treasure” (as the church fundraisers say).

That’s what you get for your money. Actually, the “rational choice” equation does not just cover collection plate money, although some “suggested love offerings” are pretty steep these days, like $50 a week. Under the rational choice theory, it’s a combination of your voluntary time helping the church and the congregation together with your financial support. E.g., you serve on the picnic committee or teach Sunday school or drive the elderly to and from services or help a young couple find a good pre-school for their first child. Under the rational choice theory, the local churches that demand the most commitment often do much better than those that don’t demand much from their members. That’s because the most demanding churches also offer the most in terms of practical benefits. Perhaps that’s why the more fundamentalist churches are now beating out the mainline Protestant churches.

The rational choice theory is very interesting, especially since it’s not about something far, far away. It’s about something that happens in most every town and city. So I’m disappointed that we don’t see more popular magazine articles and TV shows and best-seller books about this. I’m sure that a lot of ministers and church-goers wouldn’t be too thrilled about it, but controversy can be a good thing. It would certainly be an interesting way to think about Barack Obama’s affiliation with Trinity United Church of Christ in Chicago.

And finally – even though I’m just an observer with regard to religion, I would take the plunge and get involved again if I could just find the right community. But thus far, I just haven’t found a place that is worth the price to me. I hope that I eventually do, however. Maybe one day I will be a “player” once again.

◊   posted by Jim G @ 12:33 pm       Read Comments (2) / Leave a Comment
Monday, April 21, 2008
Web Site/Blog ...

I’ve changed the title of my blog just a little bit. Instead of “The Ramblings of An Eternal Student”, it is now “The Ramblings of An Eternal Student of/for Life”. What’s the difference? Well, there shouldn’t really be any. However, over the past few years there has been a proliferation of blogs by young folk (of course) who have been in school for a while and think they’ve earned the title “eternal student”. Just do a Google on ‘eternal student’ and you’ll see what I mean . . .

What a load of balderdash! You young folk have little idea what the word “eternal” implies. Neither do we old folk, but we’ve spent a lot more time pondering it. And if you’ve really got the stuff to be a true “eternal student”, then you will too. If you hit the age of 35, 45, 55, etc. and you’re out there struggling in the real world, but you still have something inside that draws you to books and articles so as to learn new things; and if you’re watching PBS shows and listening to Teaching Company lectures or taking on-line courses so as to better understand what you’ve seen and felt over the years – well, maybe then you’re a real E.S. But as to you people in your early 20’s just trying to stay out of the working world for a few more years, well . . . then fine, call yourself an “eternal student”. But you’re not an eternal student of and for life, as in “real life”. Not yet, anyway.

◊   posted by Jim G @ 6:10 pm       Read Comments (2) / Leave a Comment
Friday, April 18, 2008
Politics ... Public Policy ... Technology ...

I don’t mean to be depressing, but so far 2008 hasn’t been a good year. The economy is tanking because of a perfect-storm of soaring oil prices, spiking food costs, and a financial crisis set off by years of incautious lending and borrowing. Unfortunately, our nation didn’t have the foresight to heed the warnings that cheap oil, cheap food and cheap credit wouldn’t go on forever. So now we’re in a business recession, and we’re praying that’s all it will be. As to working on long-term fixes, such as energy conservation research, renewed alternative energy development, rationalizing our agricultural regulation and subsidy policies, throttling back the one alternative energy program that did catch fire but is terribly inefficient (i.e., corn ethanol), regulating the crazy world of investment banking and increasing consumer protection in the mortgage markets – well, don’t hold your breath.

You would think that as our nation prepares to select a new president, such issues would be at the forefront of discussion. But the nation has had bad luck on the political front (as though the economic and financial problems weren’t bad enough). The Democratic Party got caught between Scylla and Charybdis, and its boat is sinking. The onslaught by Barack Obama caught everyone by surprise, but the “yes we can” movement disregarded Machiavelli’s advice: it went after its enemy (Hilary Clinton) without having the power to kill. Just as Machiavelli said, if you can’t take out your enemy clean, then you’re going to be severely weakened by his or her revenge. Obama and Clinton seem to be playing out a Greek tragedy, unknowingly advancing their own mutual doom; here’s an article about this by classicist historian Victor Davis. The GOP will most likely pick up the pieces in November, which basically means a continuation of national inaction and misdirection from the previous Bush administration.

I’m very disappointed about this because I think it’s time for big changes, on the level of FDR’s New Deal and the Kennedy/Johnson Great Society (notice that it’s Democrats who carry out big national changes, and Republicans like Reagan who take them apart). America has to do something big about health care, about global warming, about financial market stability, about the Mexican border (albeit, McCain may well be the best person for that), about energy independence, about education, about scientific research, about the growing divisions between rich and poor, about Social Security, about the Middle East (a problem that would be a lot more tractable if we didn’t need so much oil), etc. Yes, all this will mean somewhat higher taxes and more government involvement in the economy. But without it, things are going to get crazy, not to mention unfair. Every so many decades, America has to come together and give its system an overhaul. A McCain victory will put that off for another four years (I’m being optimistic about 2012). I’m sure that Mr. McCain will do a better job of maintaining the status quo than Mr. Bush did, but he will not start the big changes needed.

Given the terrible spectacle that has emerged from the Obama-Clinton struggle, it seems clear to me that American common-sense will decide that the Democrats aren’t up to overhauling the system, so let’s maintain the status quo for now. Maybe the heartland will be more open to considering a risky commitment to change in 2012 if by then the Democrats can develop a series of potential candidates who will inspire the nation’s confidence in terms of their experience, their character, their intelligence and their common sense.

Perhaps Barack Obama did us a favor by showing that Hilary Clinton wasn’t really ready to successfully guide the nation through a course of major change. Her husband was a popular President because times were good; he talked a good line, but he didn’t even try to accomplish anything substantial (especially after Hilary dropped the ball with health care in 1994). In fact he often did the bidding of the conservatives, e.g. by taking apart the family welfare system instead of truly reforming it.

If I was Howard Dean and the other Democratic bigwigs, I would assume that 2008 is a lost cause and start work on grooming the best and brightest possibilities for 2012. The name that I have in mind is Sen. Evans Bayh from Indiana, but there are others, including Sen. Claire McCaskill, Gov. Janet Napolitano, Gov. Tim Kaine and Sen. Mary Landrieu. (This list would also include Barack Obama, if he had the good sense to abort his present campaign and let Hilary take the bullet in November.)

One more thing – there was an interesting article in the NY Times about how the Titanic might not have sank so fast had the shipyard not cut corners by using cheap steel bolts. Had the better bolts been used, as with other ships, the Titanic might have held up long enough for other ships to reach it, saving a lot of lives. This couldn’t help but make me think about the problem that American Airlines had recently about finally getting around to inspecting its old MD80’s for wiring defects, after the FAA finally pressed them (and after Congress and some whistleblowers pressed the FAA into doing its job). This will hopefully avert a modern airborne Titanic incident (admittedly, the domestic airlines have had a pretty good safety record for the past few years). But it does show that business without effective government oversight is a dicey proposition. The need for government involvement has not gone away, despite what Ronald Reagan and his Bush acolytes (and probably soon-to-be McCain acolyte) told us.

◊   posted by Jim G @ 10:08 pm       Read Comments (3) / Leave a Comment
Sunday, April 13, 2008
Photo ...

My landlord had a bug exterminator come over yesterday morning, and he told us to clear out for a couple of hours (they were using Phantom, which is a heavy-duty pesticide). I was rather upset by this, but actually it didn’t turn out so badly. The landlord agreed not to spray in my apartment, since I haven’t seen any bugs for quite a while now (knock on wood). And it got me out of the house on a half-way decent Saturday morning in April. I went over to the local nature preserve and took a mini-hike with my camera. And here below are some of my shots.

After the hike, incidentally, I was reading a book in the parking lot while awaiting the 2 PM return time. I noticed some guy in a car who kept on circling around the complex, stopping and parking near my car, then after 5 or 10 minutes leaving. He did this about six or seven times before he finally disappeared. Actually, he parked closer to my car on the last two or three passes. Very strange. Or do some gay guys still cruise obscure parking lots (and bathroom stalls – remember Senator Larry Craig)? I know that parking lots were once a big gay scene here in NJ, but I thought that with the Internet, such indiscretions became obsolete. It all seemed kind-of pathetic to me, not to mention a waste of energy and clean air; but then again, we hetero’s have our stupidities too. Especially when spring is in the air and the skunk cabbage is blooming. As evident in the pics below.




◊   posted by Jim G @ 9:30 am       Read Comments (2) / Leave a Comment
Friday, April 11, 2008
Science ...

One of my occasional topics here is science, since I’ve got a lot of geek blood in me. Lately I’ve given politics and the economy a lot of attention, given the mortgage crisis, oil and food prices skyrocketing, businesses in recession, and the upcoming presidential election. But there’s still a lot of interesting stuff going on in the scientific field; more and more every day, really. So let’s take a look at an interesting little problem that physicists are thinking about right now that could possibly “rock the foundation” of Einstein’s General and Special Relativity. (Caveat: it could also turn out to be nothing, or nothing much; in fact, that’s what most of the experts think.)

Over the past 20 years or so, the USA has launched a handful of inter-planetary space probes meant to explore Saturn or some comet or asteroid way out there. Problem is, our rockets are limited in their size and power, so you can only make these space probes so big. There’s a whole lot of different cameras and sensors and radar and computers and other stuff that the scientists would like to put on these spacecraft, but at some point it gets too heavy. But there’s a little trick that helps to fling these things out towards the edge of the solar system, thus allowing them a few more pounds. That trick is the “planetary fly-by”; the space probe is set on just the right course so as to fly close to another planet for a little while, say Venus or even the Earth itself, and thus get accelerated by the planet’s gravity and orbital motion. It’s kind of like the old trick about tying a string around a rock and twirrling it around a few times before releasing it. This all takes many months longer versus a more direct path to the destination. But it also allows our scientists to put more experimental stuff and better communications gear into the space probe. Some space missions that have done this include the Cassini to Saturn, the Galileo to Jupiter, the MESSENGER to Mercury, the NEAR to an asteroid, and the Rosetta to Comet 67P.

Well, as you might guess, our space agency continuously tracks the progress of these space ships by various means, including the use of radar. (Yes, they can use radar to track stuff  »  continue reading …

◊   posted by Jim G @ 10:32 pm       Read Comments (2) / Leave a Comment
Saturday, April 5, 2008
Politics ... Religion ... Society ...

Here are three items that came across my desk (or computer screen) over the past few days. They all seem to make a lot of sense, so I thought that I would share them with the small (very small!) handful of people who pay attention to this page.

Number One: Hilary Clinton will quit because she’s running out of money. The Democrats fell in love with Obama, and thus most of the money is going his way. And money talks. Hilary will thus fold soon, perhaps right after the North Carolina primary in early May. She is being outspent by Obama by 3 to 1 in Pennsylvania, and will thus be robbed of the big 10 point plus win that she needs there to stay viable. (Not entirely certain that she will win at all now, given the current trends in the pre-primary polls!) All that will be needed after that will be Clinton’s poor showing in NC; she may not even break 40%, if the current polls are accurate. The cash spigot totally goes dry for her at that point, and she finally reads the handwriting. Obama thus becomes the political “Black Swan” of the 2008 primary season (those of you familiar with Nassim Nicholas Taleb’s book know that this is NOT a racial reference; but the irony can’t help but be noted). We shall see if he can take his swan feathers all the way to the White House; I myself think it’s going to be another 2000 election, a real squeeker.

Number Two: Contrary to what most Christians think (and perhaps Muslims too), Jesus of Nazareth did NOT preach that we have immortal souls. That was mainly a Greek notion that was folded into Christian doctrine at a later time. Jesus, like many Jews at the time, believed in the possible resurrection of the body here on earth (but not all Jews, recall the Sauducees). But this was the physical body, not the ethereal soul. Jewish doctrine was rather quiet as to what happens to that body after that resurrection; could you die again? They really didn’t say. In the decades following Jesus’ death, the notion of resurrection was eventually tweaked into “eternal / everlasting life”, as evidenced in the Gospel of John.

But again, the Johnine notion did not necessarily envision eternal life as “spirits in heaven”; it was probably eternal life in the “new kingdom” here on earth, which would be brought forth at the Second Coming. Only a century or so later, when it was pretty clear that Christ wasn’t coming back any time soon, did the Greek notions of spirits in heaven start becoming official doctrine in the Christian Churches. Most Christians don’t appreciate just how Greek their beliefs are, and how much Jesus himself would disagree with them if he could be brought back somehow by science.

Number Three: Here’s a quote from letter to the editor found in the recent Atlantic Monthly, from a woman responding to an article about making compromises in finding a husband:

We women like to imagine ourselves as goddesses who are worthy of a man’s total worship and devotion, and we are incensed when he fails to give us that. Unfortunately, we get bed hair, body odor, wrinkles, thickness in the middle, and bad attitudes. We would not easily excuse such things in men, yet we expect men to overlook them in us.

My goodness, the voice of reason calling out in the desert! To be fair, I have to admit that men have such traits, in droves. But that’s all been said a million times about them (us, given that I’m a guy). Finally, some balance! Too bad that the writer, a Mrs. Parkhurst from Franklin, Indiana, is a MRS. She sounds like my kind of gal! I.e., very lucid, very insightful, very honest, very fair. A common-sense kind of woman. No surprise that she’s married!

◊   posted by Jim G @ 9:43 pm       Read Comments (3) / Leave a Comment
Thursday, April 3, 2008
Politics ... Society ...

Back when I was taking classes for my masters degree in economics, one of the recurring themes in my studies was that investment capital was a good thing, a really good thing. Savings and capital allowed the economy to make itself better, to make itself grow. Free-market interest rate mechanisms would make sure that this capital was fully allocated and was concentrated in the places where the most good would be done. Sure, there might still be a minor role for the government, in making sure that enough information was available to help the markets run smoothly. And every now and then it could assist by keeping a “disequilibrium” from getting out of hand, e.g. stock crashes, runs on banks, and panicky halts in lending. But that was the exception, not the rule; the rule was that capital and the free market were the king and queen of the economy.

That’s what I was taught. So I can’t help but scratch my head at what’s going on today. There’s plenty of capital out there; interest rates are very low. Perhaps there’s more than enough capital than can be usefully used. But more significantly, capital these days is VERY restless. Investors seem to desire extremely short time horizons; not many have the faith to park their funds with a corporation or lend to a government or real estate developer for a long period. I see this as crisis of faith in the future; when general trust in the world starts receding, the mantra becomes ‘be ready to get out quick’!

But, you might ask, if that is true, then why aren’t long term rates much higher than short-term rates right now? On first blush, the fact that 20 year rates aren’t all that much higher than 10 year rates, and that the same holds on down through 5 and 2 and 1 year rates, all seems to disconfirm my hypothesis here. But actually, the capital economy today is largely controlled by big corporations and financial institutions with “interlocked leadership”; this common leadership seems to know not to even ask for 20 or 30 year investment terms anymore. The demand and supply for loans and investments are mostly concentrated on the short-term side.

What about the mortgage market? Isn’t that a long-term affair (typically 30 years)? The only thing that allows (or shall I say “allowed”) the mortgage markets to continue are all of those crazy bundling devices that allow such loans to be tossed back and forth between investors and financial firms like a hot potato. Long gone are the days of the town bank having enough faith in its community and its customers to hold a home loan for two-thirds of an average Joe’s working life.

So, just what is all of this short-term thinking getting us, i.e. the millions and millions of small people who were promised “the magic of the market” back in the 1980s in return for allowing government regulation in the financial, transportation, energy and communication fields to be decimated? (As opposed to modernized, which clearly was needed.) Well, we had the dot-com stock boom and bust of the late 1990s; but that really didn’t do much damage. But then the waves of restless capital that once chased internet fortunes turned to real estate. So then housing prices boomed, which made a lot of people feel good and fueled consumer spending; but it also had the effect of putting home ownership out of reach for much of the working class.

Oh, but never fear! The newly-deregulated financial market rode to the rescue with all sorts of crazy new mortgage products that would allow people who weren’t so wealthy to become property owners. It’s just too bad that those people couldn’t afford high-priced lawyers and financial advisers, and thus couldn’t have understood all of the fine print on the papers they signed. Now they are finding out that their deals weren’t so good after all, and a lot of them aren’t going to be able to keep their homes. And even those who CAN keep them will have to cut back on spending, which finally puts the brakes on the retail sector. And thus more and more people will be out of work over the next year. Let’s just hope this will be another self-correcting recession.

So, the restless capital demon has finally been driven from the real estate market by Bernacke and our other financial exorcists. But it is not dead; it has now invaded the commodities markets! Instead re-gaining faith and settling for long-term investments into American industry and government (and perhaps also responsible home-owners and real-estate developers), the capitalists continue their short-term craze, with “plays” in futures contracts for crude oil, copper, lead, wheat, soybeans, rice, corn, etc. And thus, oil prices have soared along with food prices. It’s bad enough to be paying $3 plus for gasoline, but this capital demon is now messing with our stomachs!

Well, given the obesity rates here in the USA, a lot of people could reasonably make up for increased food prices by reducing their consumption. But the food market is world-wide, and commodity speculation in the Chicago Mercantile Exchange may well mean that a family in west Africa or Bangladesh or Haiti isn’t going to get enough calories to stay healthy and productive. So, the short-term “liquidity” craze is really taking a nasty turn here. Try telling a starving family about “the magic of the market”, how everyone “on average” is better off for it.

The overall trend behind all of this is a real problem. Consider one more point if you would. Global warming is going to require a lot of big, long-term investments to be made if our current standards of living are to be maintained. E.g., power plant operators will have to build expensive gas capture systems as to keep carbon dioxide from reaching the air; they will have to pump it underground or some such place. These expensive investments are going to require a lot of capital. Is that capital going to be adequately provided at reasonable prices (i.e., interest rate levels) by today’s “hot-potato” / super-liquidity financing systems?

I wish that I had a solution. But it’s not really something that the government can fix through a new law or regulation or agency. The real solution is a change in attitude, especially amidst the rich, i.e. the people who hold own and manage most of the capital. (Although increasing taxes on the rich and using that money for infrastructure investments, e.g. better roads, transit systems, schools, scientific research, etc. might help a bit.) Only if they calm down and start putting their faith in the long-term prospects for our economy and our nation — and back up that faith with their bucks — will this evil spell be broken. If not, then we ain’t seen nothing yet; the horsemen of economic apocalypse will ride on into the night!

◊   posted by Jim G @ 9:21 pm       Read Comments (2) / Leave a Comment
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