I'm Back

Hey folks,

Sorry for the long delay and dearth in posting.

As some of you may know, I initiated my own consulting company, Successant, in January. As one would expect, beginning an entrepreneurial endeavor such as this is time consuming in the extreme.

To make blog maintenance matters worse, however, I came down with a fever in late February which lasted, in some manner, for 6 weeks. Finally frustrated, I belatedly visited the Doctor to find a simply diagnosis of Tonsillitis. (No surgery, just 5 days of simple antibiotics).

So, in summary, I haven't stopped following the news or formulating my many opinionated thoughts. But getting these drafted out and posted just fell down the list of priorities while struggling to establish my company between fever flash-points. It does feel good to be back, however.

On Principle,
CBass

Econ Contrarian

Personal Incomes, What? Rise? But We're In A Recession!

Personal income up more than expected

March 28, 2008 08:34 AM ET

WASHINGTON (Reuters) - U.S. personal income rose more than expected in February as the economy teetered on the brink of a possible recession, while both personal spending and a key price measure increased only slightly, a government report showed on Friday

Personal income rises, inflation moderates

The Commerce Department reported that February personal income rose 0.5 percent, exceeding a forecast of a 0.3 percent gain made by analysts polled before the report.

"The decline in the year-over-year core PCE is important in that it supports the notion the Fed is making the right decision in cutting rates aggressively and not threaten long-term price stability. It argues that the Fed can lower rates in the months ahead," said Zach Pandl, an economist with Lehman Brothers in New York.

Even Fewer People Are Looking For Jobs?

Jobless claims fell 9,000 last week

March 27, 2008 08:38 AM ET

WASHINGTON (Reuters) - The number of U.S. workers filing new claims for jobless benefits fell by 9,000 last week, the government said on Thursday, though a more reliable gauge of layoff trends rose to its highest in more than two years. Full Article

Requisite footnote on the "Econ Contrarian" series:

As with so many other complex issues in this modern world, I don't claim to know what tomorrow holds for the economy. There are just too many competing systems interacting in labyrinthine layers. But, since no one else seems to want to focus upon any of the positive indicators in this complex mix, I think I'll stand in the gap and shine a small, small light to illuminate a few contradictory indicators – indicators which make the more balanced point that while certain segments of the economy will certainly retract a bit after years of unprecedented growth, this doesn't exactly mean the expansion of the new era of Mordor.

On Principle,

CBass

Bush Derangement Wearing Off

There are signs that the pandemic which is the "Bush Derangement Syndrome" (BDS) is starting to subside.

What is BDS?

BDS is that pervasive contagion which subversively and subtly causes one's perception of all events in life to be negatively interpreted and then be linked back to President Bush. BDS is the reason why Bush can both be a stumbling dunce AND the current evil mastermind behind the Vast Right Wing Conspiracy. BDS is how Bush can simultaneously be an inhumane, war mongering drunkard and a radical born again Christian who insanely feels personally called by God to the Office of the Presidency. BDS is why Bush is obviously the original, prime and personal point of causation for Global Warming, Hurricane Katrina and bridge collapses.

Is BDS Subsiding?

A recent poll reports some perspective may be returning to the populace:

• About 64 percent of likely voters approve of Bush's economic stimulus package passed earlier this year;
  
• 67 percent back his initiatives to help struggling home owners survive the current mortgage crisis
  
• 70 percent endorse his plan to allow monitoring of foreign communications of suspected terrorists
  
• 72 percent back his visit to the Mideast to promote peace. In addition, 52 percent approve of his surge of U.S. troops into Iraq.
  

If you are like me, you may not wholeheartedly support these specific initiatives, but it is encouraging to see folks finally being willing to attribute something positive to the President. If BDS antibodies continue to fight back this infection, perhaps the body politic will finally take a second looks at:

• An economic record which, despite the current unpleasantness, featured record growth in jobs, home ownership, minority income advancement, stock market levels, involvement in the stock market and GDP growth.
  

  
  

• A foreign policy record which features huge increases in international aid, the dismantling of an international nuclear weapons black market, the clearing of chemical weapons from Libya, alignment with Eastern Europe, the birth of Democracy in numerous nations and the building of alliances in the emerging Pacific super-market.
  

  
  

• A return of decorum and respect to the White House.
  

  
  

On Principle,

CBass

North Korea

One of the perpetual frustrations in US foreign policy for 2 decades has been our absolute stumbling response to North Korea's nuclear intentions. Any rational observer must surely admit the Clinton administration's back-slapping self-congratulations were a bit premature. But that same observer must scratch the head in wide-eyed wonder and the aimless dance of the Bush Administration's 6 party talks.

An analysis of the history of this problem and a dissection of the last 7 years of our policies toward North Korean would surely take a cumbersome tome to detail. In short, I think it all boils down to 3 key points:

1. It's not North Korea: A petty dictatorship which can't feed its own populace and which engages in blatant global narco-trafficking and counterfeiting of US currency is not our stumbling block. When interpreting the daily news out of this region, please don't fall into the trap of wondering "How does Kim Jong-il do it?" He doesn't. Any sort of naval blockade and economic sanctions supported by the US and China would quickly cripple this potbellied despite.
   

   
   

2. South Korea: The sad reality is that the US has not had a strong partner in South Korea at the negotiating table. South Korea is separated from its deranged sister by an imaginary line drawn to win a quick peace. While the world could crush North Korea with economic sanctions, South Korea would be left of mop up the mess of fleeing refugees and familial ties which have bridged the Demilitarized Zone for half a century. These concerns have tied the hands of the US in pushing for negotiations which are stronger than South Korea is willing to pursue.
   

   
   

3. China! China!: Many folks don't understand why China would ever support US policy toward North Korea. Won't China do anything possible to thwart our interests? Perhaps. But reality on the ground is far more basic than that. North Korea also poses a HUGE destabilizing, boiling pot of potential refugees. While China's economy is booming, it is extremely unstable and the addition of hundreds of thousands or millions of poverty stricken refugees won't help its stability. Well, isn't China concerned about a nuclear armed North Korea? Probably only marginally. North Korea exists largely because of the economic, agricultural and pharmaceutical aid of China. China's military might outstrips that of North Korea beyond any analogy of David and Goliath. So, in short, no – China is not that concerned about North Korea's nukes, but it is very concerned about onerous economic sanctions.
   

Based on the above, how can the US hope for any progress in this year? The answer lies in changing the dynamics of one of these points. In this case, South Korean's democratic electorate has decided for a change. The new South Korean government, headed by President Lee Myung-bak has strongly stated its intention to align with the US and its willingness to place pressure on North Korea again – changing years of South Korea's policy of friendship toward North Korea. So, perhaps, this impediment to progress may be adjusting into an additional push for progress.

With this change, the US now has some key momentum to move China. China, in addition to fearing economic instability from a refugee crisis also eagerly desires economic leadership in the Pacific realm. South Korea, not a small player in the new economy, may not be willing to work in unison with the US and Japan to build a network of supports for China and sanctions for North Korea which will move China into a more proactive role of ending North Korea's ambitions.

Kim Jong-il is China's lap dog. Present China with a much enlarged dog dish and I think they may be willing to neuter this tramp.

On Principle,

CBass

Econ Contrarian – Trade Deficit

Another installment of posts which stand against the obvious torrent of negative news about the economy.

It seems the US Trade Deficit dropped by 9% in 2007. In my world of consulting, companies pay HUGE bucks to improve their efficiency by 10%. (Note: if you work for one of these large companies and write those large checks, please see my business at www.successant.com).

http://www.forbes.com/feeds/ap/2008/03/17/ap4780608.html

On Principle,

CBass

Travelocity Tort

Now see, if this happened in America, someone would be taking the Roaming Gnome of Travelocity to court for pain and suffering. . .

'Creepy gnome' terrorizes town

""One of my friends was so scared after seeing that thing that we had to take him to the hospital."

Economic Contrarian

There is much economic doom and gloom being broadcast and re-broadcast and re-broadcast and re-broadcast and. . . (you get the point).

It seems that every day brings new "wisdom" about how the US Economy is on the crux of a major collapse, how prices are rising faster than 80's-90's Argentina, how consumers must stop buying anything but absolute necessities – like milk and bread (oh, sorry, milk is too expensive now – so just buy bread) and how we are all going to lose any and all value from our homes – the quintessential cornerstone of the quixotic American dream.

Run for the hills, chicken little, the global financial sky is about to crumble upon our miserable, poor, recession sickened heads.

Look, as with so many other complex issues in this modern world, I don't claim to know what tomorrow holds for the economy. There are just too many competing systems interacting in labyrinthine layers. But, since no one else seems to want to focus upon any of the positive indicators in this complex mix, I think I'll stand in the gap and shine a small, small light upon the few contradictory indicators that while certain segments of the economy will certainly retract a bit after unprecedented growth, but this doesn't exactly spell the new era of Mordor.

Looks like not ALL jobs are evaporating. . .

U.S. jobless claims tumble 24,000 last week

Does this sound like Stagflation?

Wal-Mart February same-store sales up 2.6 pct

On Principle,

CBass