Wednesday, September 24, 2008

AT THE POKER TABLE

from Murph


Ok, I’ve just got to talk about what I am reading concerning the economy. My disclaimer is that I am not an expert in economics, and have only been indulging in it for the last 8 years or so, with the emphasis in the last 4 years.

About 8 years ago, I bought a course in investing in the stock market that depended on what is called technical trading. It was a reasonably expensive course at the time. I carefully went through the course, put up a $1000 dollars which was all I was willing to try with unless I made money from it, figuring I could recoup at least 50% of it if it didn’t work. I opened an online brokerage account and went about the rather lengthy and time consuming analysis of what to buy according to the stock charts. I bought a small amount of shares in 5 different companies, including one penny stock. Within 30 days, two of them had dropped below the purchase price, way below. I had literally lost $400 of the original $1000. I held onto those 5 stocks for 3 years, watching them steadily erode to the $500 level I had set for myself. In the third year, two of the stocks had come back up somewhat, interestingly; one of them was gold mining operation. I quickly dumped them all for a return of $600 or so minus the brokerage fees. So I ended up over three years losing $400+ of the original $1000. At the same time I gambled the $1000, I was employed with a company that had a 401K plan. I dutifully got into that game and started to track the choices I had with the funds for where to put my meager amount of money. There were about a dozen different funds to choose from. I studied the charts, and tracked the changes, read analyses of the funds and moved money around accordingly, sometimes once a week. We had some guy come to the company and talk about how to invest in the mutual funds offered by the 401K. As usual, he maintained that you must be in for the long haul and not switch funds around, that you would lose money that way. Well, at the end of 4 years of that, I was the only one in the shop that had a modest increase in my 401K funds, the rest of the shop was losing money hand over fist. They all asked me how I did it and I told them that I was constantly moving funds around into different areas according to the returns data I was getting. They asked for examples and I told them exactly what I was doing. Only one guy tried my ideas on it and he saved himself over $3000 loss in one weekend. But, I had such a small amount of money in the fund my returns were also small, but they were positive.

I started, at that time, reading more about how the markets worked and very quickly figured out that the markets are heavily manipulated and the small investor is very lucky to make anything from an independent investment. So, in 2002 I liquidated every one of my paper investments. Made some on the 401K, lost some on stock market. Plus, it took me a year to recover the money taken out by the 401K that was put into federal taxes that I had fully refunded minus the bookkeepers filing fee. I figure I broke even, not counting inflation.

Which brings us to the last couple of years, and particularly the present. I can’t describe the disappointment I hear from people in our area that I have talked to that had depended on 401K’s and IRA’s and stock investments for their retirement. Some of them are looking for work now, any work, to save their house that they bought on mortgage to retire in. They are truly expressing to me the desperation they are feeling since all their income sources are just flat out drying up. For multiple reasons, their really beautiful $300,000 or more place can’t be sold at all, and its evaluation keeps eroding. To top it off, they live way outside the area where they can buy food and supplies and most of them have these gas hog big pickups and SUV’s. The poker table they sat at has not treated them well in the long run. For a number of years, they felt they were winning at the table and felt wealthy. Oh, and by the way, most of them are/were Republican supporters.

Got to say that I am very thankful for the decisions Freeacre and I have made around this issue. We are driving old vehicles, our property is owned free and clear except for taxes and the only debt we have between us is my school loans and there is no way I can make payments on that. We think we have put ourselves in the best position we could with the meager resources we had available for when the shit storm hits.

The point of all this digression is that for years now, trying to get money with paper assets has made a few people actually quite wealthy and a whole bunch that felt wealthy. It appears to me that it was a crap shoot from the very beginning and the players have now been thinned considerably. It was a national casino with the odds stacked against you from the beginning. It has been the largest transfer of wealth to the upper 10% of the population in the recorded history of mankind.

And now, with all that wealth disappearing except for about 5% of the population, the citizens are being asked to pay for the loses for the bad decisions of those that wanted money for doing nothing productive, that is, investing in paper. Unless of course, you want to place paper shuffling in the category of productive output. The really sick part is they are getting it, every damned bit of what they want and the rest of us are stuck with the bill, about 40 trillion dollars worth from the latest estimates I have read on the top end. The lowest estimate I have seen is a total of 5 trillion dollars. A very few of the congress critters we can support. Watch these two videos, excellent.


http://www.youtube.com/watch?v=S27yitK32ds
http://www.youtube.com/watch?v=mbD62gNi9WE&feature=related

I am sure that the readers of this blog are reading about the deal with Paulson becoming financial dictator of the U.S. and all it implies. This all by itself is a reinforcement of a doom and gloom attitude. Notice the tactics he used, scaring the hell out of congress critters that haven’t the sense to quite dumping money down a rat hole. The whole lot of them need to leave the poker table and let some competent gamblers in. The very people that have created this financial Armageddon, now want to control the whole shebang. I do wonder if this will bring on the revolt and a revolution. Of course that would also bring on martial law.

Now the discussion revolves around where this money is going to come from. The government is broke, deep in debt and the tax base is eroding because people aren’t working, and if they are, at lower levels of pay. Bush has largely excluded the taxes from the top income people with the expectation that the worn out trickle down economy actually works. The interest on the national debt is greater than the amount of tax dollars coming in. So, to keep things rolling, the government is borrowing from foreign investors at the rate of 2 billion dollars PER DAY.

Currently, the stock market is going down, precious metals are going up, the dollar is sinking and oil is increasing in price. I expect to see fluctuations in this, but maybe not. And, all of this is going on with the infusion of money to prop everything up by rolling out the printing presses, which will ultimately devalue the dollar even further. Our owners are bending us over while they present royal flushes. .

So where is the money going to come from? It’s called a printing press. So, to pay for all these bailouts, they print money and sell government securities to the overseas investors. Have you heard that they also want to bail out foreign banks that have interests in this country? Talk is circulating about what to do about this situation. More

government oversight and regulation is being bandied about. Cripes, it was the government and the Federal Reserve that caused this mess, can they really cure it without a complete restructuring of the complete financial system? Oh hell yes, let’s just socialize everyone and everything that is in trouble. The big boys just love it when they get the profits when times are good and socialize the losses when times are not so good. Notice how far (to what is called the left) the republicans have moved? We have become an actual economically socialized state, which we have been supposedly fighting against for the last 100 years. Why should we become socialistic? Looks to me that the lack of cheap energy has spurred it on, plus the absolute corruption and greed that permeates our whole society and government. And how did these suckers get into power? We gave it to them every election cycle since before the civil war. We encouraged the great poker game in the economic realm of society. Now the losses are piling up and the game is going to have to fold and the winners get to walk away scott free. Talk about social Darwinism! And by the way, take a look at this information:

http://www.oftwominds.com/blog.html concerning this deal with Paulson.

Am I angry about all of this? Hell yes! Problem is, that means I have to carry around anger about myself too since I participated and voted, and I would also have to be angry at another 300 million or so other people also for doing the same. Appears to me that is not a very productive position to maintain. So what I have left is to admit my stupidity and lack of information and get ready for the consequences of this shit storm. Sure hope you all are doing the same. Aho.

53 comments:

Jacques de Beaufort said...

privatized gains
socialized losses

Your comment about Martial Law seems particularly prescient. I watched "The Grapes of Wrath" last night to get into the psychology of a depression and was struck by the brutality and corruption of the "police" during the Dust Bowl exodus. I expect that as the US dollar becomes worthless and as people find commodities to be beyond their means and their entire way of life wiped away, there will be anger the likes of which we have NEVER SEEN.

The haves still have plenty, and they will become increasingly cloistered behind a wall of private security thugs and Blackwater style private militias. This will arise as pressure grows on government to follow through with it's socialist bailout of the Big Boyz with similar relief for the now enormous lower tiers.

The net effect will be a nation that turns inward, becomes protectionist and disengages from most international client arrangements due to financial stress. The world is now entering a period of extreme instability. Anything can happen.

During the next 4 years, whoever becomes the Prez, there will be new voices emerging. The fascist right sponsored by the remaining elites will be pitted in a fierce contest against the fascist left, who will cry for the heads of these corporate swindlers. Most people will be caught in the crossfire.

There is no hope to maintain our current "way of life". We as a community are way ahead of the curve on this, having absorbed all of these realities long ago. What we will now witness in America is the "Anger" stage of catastrophe. Prepare yourself for violence in rhetoric and reality. Keep a clear ahead and see above the anger. It will only produce more anger. Nothing could've prevented this. No one is to blame. Everyone is to blame.

Stay safe.

murph said...

Jacques,

For sure our way of life is becoming very negotiable. Yes, it will change, in what way exactly is open for debate. I do think martial law is coming. If the public becomes aware enough and pissed enough, there will be rebellion and then for sure some form of national martial law.

I notice you didn't include the fascist left in with the elites. Was that on purpose?

You stay safe to buddy. I do think we will see rough times.

Jacques de Beaufort said...

The fascist left has the worst elites of all...self-righteous elites.

Anonymous said...

Murph

Well...the proverbial spit is hitting the fan. Still this is not yet the worst of what is yet to happen. I read estimates of the derivatives market of which a lot of CEO's of the big Finance companies on Wall Street participated and took away huge bonuses for doing so,could reach near the 600 trillion mark if all accounting was accurate.

This 700 billion is not anywhere near enough to fix what is breaking and what is about to break.

What it will do is allow those that are the primary creators of this mess to evacuate the scene with golden parachutes and money sacks exit stage left, and the bill will be on the taxpayer, the taxpayers children and the taxpayers grand children. The whole proposal is scary as hell and the scariest part for me is that congress has NO friggin' idea what is being requested by Hank Paulson and should they go along with him and his slick tricks, welcome in the New World of Economic slavery. No they may not come with shackles or chains, may not have whips and dogs to cajole you into line but they will forever hold that debt you owe over you, with those that have orchestrated this situation making the rules up as they need to to keep you as a slave.

OK I think that is enough for now, I do not have faith that Americans will wake up to what is happening. I have told and talked and supported my statements of what is to happen for well over a year now, possibly closer to 2 years to anyone who would listen, family, friends, and even strangers in short conversation, almost all have as much as told me I was cracked.

Right now the best thing to be happening is that Survivor is starting up again and soon will be the Next season of Idol and that will be the circuses for the masses.... oh well I think I hear a violin, and hey could that be a whiff of smoke I smell???..lol

I will leave you with this...
http://www.wsws.org/articles/2008/sep2008/forb-s24.shtml

Ely

Palooka's Revenge said...

murph... i encourage you to send this post to every op editor in the land, both internet and newsprint.

i too played the game. i'll spare the details but suffice to say it all came to a point where certain factors became clear to me:

1 - the deck was stacked

2 - if i or any player made/won a dollar, somewhere someone lost that same dollar.

3 - the same players were winning most of the time

4 - a few elite players had the power to, as they say in texas hold-em when a player looses his stake, re-load. from some mysterious source.

5 - a few elite players had the power to call a card wild AFTER the cards were delt, after all were looking at their hands, and bets were on the table.

6 - the game was a monster that had grown to the point of beginning to eat itself alive.

7 - it was beginning to eat more and more of the players alive as it built, one small bite at a time.

8 - while the game on the table was on-going, certain players were using the table money to stake side games... weird kinds of games nobody had ever heard of. and they were loosing.

9 - certain players had the ability to change the rules wnerever they wanted.

10 - the lives of the audience of many people who had no ability to get in the game, who could only sit on the sidelines and watch, were being negatively affected. somehow their money was being filtered from them onto the table a little at at time. and it was disappearing.

11 - the money in the pot wasn't real. you couldn't eat it, you couldn't drink it, it didn't shelter you, and it couldn't keep you warm and your food cool.

12 - it just simply didn't feel good anymore.

13 - the game was not conducive to life, love, liberty, freedom.

there's more but those are the highlights... especially #12.

not to pick on george ure, a man who's website many of us read everyday, cuz i admire the guy and his message and his efforts to educate his readers. but, in my view, there is one card in the deck he continues to overlook. thats the one that sez... the only way to win is to not play the game.

and oh yeah... you/me/we are left with one more thing to do. the most important of all... forgive ourselves for feeding the monster... p

RAS said...

Sometimes being right just isn't any fun, is it?

The one job I ever worked were I actually had a 401k was several years ago. It was considered a 'good' job: high salary, lots of benefits, bright future. That was when I bought the house I'm currently trying to sell (and while I was smart about it in that I got a good loan, looking back anyone who'd give a kid my age a mortgage was crazy, but that was the housing boom.)
Anyway, though I was barely old enough to set foot in a casino I could tell by looking at the 401k materials that it was more like a casino that I was comfortable with. I never put any money into the thing. (And at that age I had better uses for the money. Still do, lol.) But years later, that company still maintains a 401k account in my name that they use as a tax shelter and the management company says that it is perfectly legal and I can do nothing about it -and the money in that account is not mine. Wtf?

Jacques, I recommend you go out and pick up a copy of the book version of The Grapes of Wrath. The movie is great but the book is much better.

'Stay safe' may become the parting watchwords to people you know in the coming years.

Bill Heard, the largest chain of dealerships around here and a big employer, shut down yesterday without warning. All those people out of a job, just like that. And I was about to apply for a job with them, lol. Ok, that's gallows humor but still.

Fall really is here now. You can feel it all day, not just in the mornings. The trees are starting to turn. There's nothing quite like this time of the year when there's a bite in the air and the trees are turning.

Anonymous said...

Yeah Ely, I also don't have one ounce of faith in my fellow Murikans waking up from their Suvivor/Idol/Lost/Heros/Brittany/Paris/Loland/ stupor. Here in Mormon HQ, it's like deer in the headlights. They watch Faux News like it's coming from JHC (Jesus H. Christ) and question NOTHING. It's just totally narly.

On top of that, my wife pretty much thinks I'm a conspiracy nutjob and ignores my rants. Now I'm wondering what the cat thinks of me.

But most people are just way too busy worrying about the meaningless paperwork they fill out all day long at their meaningless jobs. What a waste of human endeavor. I wonder what the world would be like if we could tap into the 75% of our brains we're not using. Shit, we'd probably figure out more ways to fuck each other over -for more money.

Money, money, money. Gimme, gimme, gimme. Shit. This crap has got to stop and the sooner the better. Wish I had the means and the guts to just chuck it all and get outta Dodge. I guess I'll just continue stocking up on beer supplies. Later-

Dude

freeacre said...

Can you believe the pathetic posturing that McNumbnuts is doing with his phony "suspension" of his campaign so that he can "deal with the economic crisis"? What a load of bullshit. He has not even been in touch with any of the participants, and for the first three days at least, didn't even read the proposal, according to Huffington Post! Meanwhile, Obama has talked with Paulson 3 times a day and been on top of it with Sen. Dodd, et all, the whole time. And yet, McSame is going to try to fly in and take credit for saving the nation. Unbelievable. He's just dodging the debate because he knows he'll come off looking like a moron next to Barak. You'd think he'd get used to it by now. After all, a lot of rich people can afford to be morons because they don't have to be smart, just rich.
I participated in a 401K plan for 2 of the 9 years I worked for the Tahoe Tribune. I resisted it for the first seven years, explaining that I "wasn't a capitalist." Did it anyway the last two because I compromised my value system, I am ashamed to say. I think I walked away with a couple of thousand dollars when I quit. I felt like a sleezebag when I was contributing to it. Let's face it, I was a sleezebag. It feels, good, Palooka, to think of forgiving myself. I had not thought of that. Don't know if I deserve it, though. Coming from a Hindu tradition, there is not a lot of forgiveness when it comes to karma. Judeo-Christian guilt is nothing compared to Hindu guilt. Karma follows you for lifetimes. (Which is why I am not a Hindu anymore..)
Anyway, where was I?
Just when it's getting so dramatic, and I want to make a bowl of popcorn and just be entertained, I gave up eating carbohydrates. Christ, it's not fair! Now I'm into the whine cycle. Damn.
I am looking toward the sky for a cure for this insanity. Not for the Second Coming, but for the asteroid or the mothership or some damn thing to end this never-ending stream of atrocities. I have to admit to being grumpy. A woman with no carbohydrates is a frightening thing...gaaah!

RAS said...

I love your rants, FA.

The bailout is a done deal, according to NPR and CNN's website.

I'm grumpy too, but that's partly because I'm sick. I have the stomach bug from hell. Everyone else seems to have it too. The rest is just that I'm pissed off over this whole bailout business. Where's my bailout? Where's my check? Hell, they don't even have to give me money. Just give me title to a bit of land so I can at least feed myself while the world goes to sh**. Hmm, I predict the war after next is going to be fought over access to farmland. Ha.

Dave said...

A while ago I concluded that the stock market was a zero-sum game, and that the big fish profited primarily at the expense of the little fish. Think of the big players as the “house” which owns the casino we call the stock market. The little players are like the gamblers who play against the house. The main reason the big fish manage to eek out a profit is because they are privy to inside information or are principally involved in manipulating the prices. Even Jim Cramer recently admitted in a video clip that the markets are rigged and that the little guys should get out.

Years ago I liquidated all my stocks and mutual funds that had constituted my retirement funds and used the money to buy a house which I own free and clear. I only wish I had done it before they lost 60% of their value following the dot-com bubble! Oh well, live and learn, especially the latter. Like you guys, at least I am debt-free and have a little money on which to live.

One way to get even with the powers-that-be who seek to extract a pound of flesh from each of us to pay for their mistakes is to be too poor to pay! I know that sounds draconian and unpleasant, but it really doesn’t have to be. If you can be somewhat self-sufficient and survive on a trickle of income, you won’t have to pay any income taxes in support of this madness. And by being self-sufficient as much as possible you can reduce your sales taxes. And by owning a cheap property, which is complementary with having no income, you can minimize your property taxes. And by withdrawing your support from corporations as much as possible you can starve that beast as well. Speaking for myself, as long as I can pay my modest bills, which I’m always working to reduce, I love being poor!

Dave

stoney13 said...

At this time in Henderson County, Buncome County, Polk County, and Rutherford County, North Carolina there is no motor fuel of any sort! No gasoline! NONE All gas pumps are off, and no diesel fuel has been delivered since September 11!

It's here, it's happened! Kick up your heels, and dance in the shit! All it took was the housing bubble to burst, and a couple of hurricanes! That's ALL it took to bring down the entire financial infrastructure of The United States!

*sigh* I wonder how long it will take the ammo I ordered to get here!

murph said...

Dave,
Your said "Speaking for myself, as long as I can pay my modest bills, which I’m always working to reduce, I love being poor!"

I'm sure you realize there is different levels of poor, just like different levels of rich. There is poor like being homeless and living in a cardboard box under a viaduct. Then there is poor like a whole bunch of Americans where you owe more money than their total assets. Then there is the few like you and us that have our house, and just barely stay even with bills and staying well fed and warm in the winter. The viaduct and cardboard box is unacceptable to me. Won't do it. Then there is poor like in some of the African countries, or North Vietnam. In our country, there is poor like the farmers during the dust bowl days. Grapes Of Wrath is a dramatization of it.

Guess a person has to establish just how far down they are willing to go to stay alive.

murph said...

Stoney,

I had heard that gas was getting short around your neck of the woods. Interesting, no word I have heard on Lamestream media about it.

I wonder how far that will spread. Is it temporary or not? Figure it will last long enough to start rioting in your area? Maybe a bit of a taste of martial law? Bet you stay at home more now. :).

LOL I told you not to hold off on the ammo order.

Dave said...

Of course, I used the word "poor" somewhat euphemistically. I didn't mean abject poverty; I meant poor, as in relative to all the people I know, some of whom are extremely rich. I certainly didn't intend to make light of the plight of those less fortunate than me. I hope nobody got that impression.

Dave

Anonymous said...

Dude

I have often wondered who or what type of people watch Fux News,... so now I know. As it is really the only US Network down here in Colombia that brings in US news in english, I once in a while stumble on to the channel but a few minutes later I am told to turn it away as I am often speaking often shouting profanity at people I see on the screen and their sheer stupidity. FFS that network has collected some of the dumbest people alive...

Far better choice is watching the BBC World news and even CNN international. At least they are palatable...

Freeacre... I think I understand you and your thoughts as there are days I am almost praying that we are touched by a large meteor, asteroid, or the world does a pole shift....then maybe if there is any of this dumb ass species we call humans left we can start over and maybe do a better job next time around.

Ely

freeacre said...

I hear you, Eli. And, in regards to the site that you suggested to go to about the 400 richest people, I sent a rant off to my congressmen about that too! Then when I tried to go back to it, it was not available. Humm...

stoney13 said...

Marcy Kaptur ROCKS!!!!!!

stoney13 said...

Murph,

Ammo gets delivered tomorrow. ^_^ Neighbors will HATE it!

From what all the suits on TV are saying, the gas will start flowing next week. Of course since when did I put any faith in anything the suits on TV say?

Martial Law? Nope! Not in this neck of the woods! People around here have been fighting against the ATF, "Revenuers", DEA, and all sorts of three letter government entities for years. It wasn't long ago in a lot of folk's mind when the "Carpetbaggers" invaded!

Riots? Nope again! Folks around here wait for trouble to come to them, they don't go out looking for it!

There's an old story about a place not far from Saluda called "Dark Corners" where all the moonshiners used to ply their trade.

One day a wagon load of "Revenuers" went in to the place to bust all the moonshiners. They were never hear from again!

Some of these people aren't the easiest on the eyes, and some of them have the IQ of a stump, but when the shit comes down, they're some damn good people to have as neighbors!

freeacre said...

I hope the American people remember that these mutherfuckers that they want us to bail out are the same ones who made money on their stocks whenever a bunch of us were thrown out of work.

If the democrats and republicans wanted to show their solidarity with the working class, like they said in the conventions, they'd tell the people being evicted to stay in their homes and screw the banks.

What comes around, goes around....

freeacre said...

Damn, I'm pissed off at this shit! I just wrote this letter to the National Democratic Party:

"If the Democrats and the Republicans agree on a bailout of the Wall Street gangsters that have robbed and cheated their way to the top of the heap, I swear that I will NEVER VOTE FOR EITHER A REPUBLICAN OR DEMOCRAT AS LONG AS I LIVE!!

These are the same miscreants that have made money on the stock market every time that massive lay-offs have hit the working class. What comes around, goes around.... offer them the sidewalk. That's what they have given us.

If you were to be serious about your working class loyalties (as you portrayed yourselves non-stop during the convention) you would tell people to stay in their homes and let the banks take it in the shorts because they deserve it, not us.

We are going to lose our jobs and our pensions and our health care and everything else anyway. We, as usual, are on our own. But, I'll be damned if I will let you bastards take away my children's future as well.

And, don't say you never saw this coming. Even I saw it coming years ago and got ready and prepared. I am raising my own vegetables and have chickens and rabbits. We will survive. But the people that were dumb enough to trust you are really going to suffer. It is your fault and you should admit it and don't give us any more of your shit.

RAS said...

Ok, I'm pissed. I got up this morning, feeling better but still slightly nasueous, and discover that WaMu failed last night. Not only did it fail, but it was immediately bought out by JP Morgan, who evidently had been planning this for some time. Then I turn on NPR and hear the congressional democrats bleating about how we 'need' this bailout.

F**k that, and f**k them. F**k the whole damn system. Let it come down, let it burn. I'm sick of this whole damn thing. We might have to run like hell to escape the flames but when the embers burn out, the ground will be fertile for something new. Grrr.

Aho.

Anonymous said...

That was smokin' Freeacre...loved that address to the politicos. You got it right BUT Will they listen..not bloody likely but it all has to be said...

Stoney...that neck of the woods sounds about fine to me...sounds like a collective that pretty much minds their own business until you get up in their face and then they do what it takes to make it right with the world again...

Ras.... WaMu is just another in a very and I mean very long list, some are saying there are at least a 1000 in trouble, of banks that will go under and if anyone here thinks that the FDIC has enough money to cover all those about to go broke y'all are just foolin' ya selves....heheheheheh

Get your money out while you can, spend it while it still has a value on things that will have value when the time comes.

Later eh

Ely

murph said...

Hey Dude,

Just reread your comment and something caught my eye. If only I could live up to the expectations and idolatry that is in my dogs eyes. Been true of every dog that chose to coexist with me. sigh. Now the cats and chickens are another story. Ever get the feeling that your being accused of something but you don't know what and so can't fix it? One thing I've found with the chickens is that when it is time for the scratch corn being thrown out, I better not be late or else..... Geez, thats what we get for raising a bunch of feathery anarchists.

RAS said...

Ely, I know all that but what makes me angry is that they deliberately seized it now as a way to help ramrod this damn bailout plan through. Aargghhh.
I don't have much money in the bank to pull out. Or anywhere else for that matter, lol.

There's still a massive gas crunch down this way. Locally there is some gas but not much. It would be hard to go on a trip right now because you probably couldn't get enough gas to make it from one city with gas to another. That's how bad it is. The PTB are saying that it's due to panic buying but that's a lot of BS. Diesel is doing okay, and that's the only reason the stores aren't running really short.

They are running short, though, I noticed. Not massive shortages but some. Most of the heavy-duty commuters are having trouble getting enough gas to get back forth all over the south. People in Atlanta are actually CAMPING outside some gas stations. Welcome to Peak Oil the preview.

freeacre said...

I hope you are feeling better, ras. And your comment, "Welcome to Peak Oil, the preview" is right on. I worry that you and Stoney and Palooka , all being in the SE, are going to be okay. It's really duck and cover time. How are people getting to work? How about school buses? People needing to go to the hospital? Good grief.
I finally heard a politician use the word "pension" ( as in "we are trying to save your pensions...") regarding the bail-out. The next several weeks will probably be increasingly anxious. So, let's remember to enjoy as much as we can while we prepare...to appreciate each other and be kind and generous. These may be the "good old days" that we look back on. So, let's remember to savor the good things and take a deep breath and take some time for those little things that make us and those we love happy.
aho

RAS said...

Freeacre, thanks. I am feeling better. Good enough to come to work yesterday and today, though these 12-hour shifts are wearing. What do they think I am, a robot? Don't answer that; I all ready know. At least I'll have a good paycheck, for once.

Diesel supplies are doing okay (for now) so school buses and such are running. Emergency vehicles have priority fill-up rights at the municipal gas stations here. At other places the cities are out so they have to wait in line like everyone else. I've heard but can't confirm that some cities have seized gasoline shipments for their use, which is easily doable since most cities down here keep their own stations for their fleets.

A lot of people just aren't getting to work, especially in places like Atlanta. I've got some gas but not much and the cheapest I've seen it at the stations that have it is $4 a gallon. One station over in Georgia has been accused of price gouging; they were apparently charging over $8!

These most definitely will be seen as the Good Old Days before too much longer.

Anonymous said...

Ras...

Reading your input concerning the gas shortages in your neck of the globe I have to say thanks for the update but I am also thinking...WTF, why is this situation not making much in the way of headline news.... this IS a breeze of significant things to come and the news about this, is what??? All but non existent. pathetic MSM, but really what do I really expect, they are told what they can say and show nothing more.

Even down here I am starting to see a bit of economic slowing, friends that rely on trade to the USA have been told that should the dollar exchange at 1500 pesos the operation will cease, at the moment the govt here is artificially holding it at around the 1800 peso mark. The govt is also not being too terribly subtle in letting investors here know that any investment in the US Dollar and in certain sectors in the US is extremely high risk and they are advising against, so another small nail in the economic/financial coffin there.

Still I see things are slowing a bit here, but we at least have a supply of fuel... I am guessing it is because of trade alliances with Venezuela.

Later eh

Ely

Palooka's Revenge said...

(i wrote the following yesterday but didn't post it. posting it now as part 1 of a 2 part comment. part 2 coming)

WA-MOO goes POO POO!!

i was listening to a segment on cnbc. you know, those segments they run where an anchor has point, counter point guests on they refer to as "experts". this one had 4, one of which proclaimed herself to be a tax attny. the discussion was in context of who was the most brilliant of the 2 candidates for pres present at the big pow wow at the white house over the bail out. which, from a political view, is of course one of the pissing contests between the 2 parties... too much gov or not enough gov??

it was immediatly apparent who's side said tax attny was on. in the course of the discourse (which was more argument than anything), she made a stmt to which i had an immediate reaction of disgust. she'd prefaced this stmt by saying other things besides a massive bail out could be done to calm the storm in the finance sector besides a massive govt intervention. "let the principles of free marketry decide", she said.

i, and as is the case of most of main street who are up to their limit of tolerence for greed, happen to agree with the general stmt. but then she gave an example of what could be done to help good ole "free marketry" along. in this case eliminate the mark to market requirement. one of those vile, nasty regulations.

my reaction was disgust! eliminate mark to market? wasn't/isn't totally unrealistic value of real goods at the core of the crisis? and she wants to eliminate the requirement to mark value of underlying asset to market? just dream up something to make the numbers work? isn't real value the very thing upon which the economy is viable. real value? value determined by supply and demand? the very foundation upon which the concept of capitalism is built?

a repug tax attny presenting as an economist and "vopice of reason" for mccain and fellow repugs. typical. she's a nut, i thought. just more repug bullshit about the evils of regulation (not that there aren't evils in too much reg). then i read this this morn.... http://www.truthout.org/092608R

the headline, "IS THE BAILOUT NEEDED? MANY ECONOMISTS SAY NO" caught my attention and i thought, great, economists speaking out to this insane idea of a 700B tax payer funded intervention. finally! voices of reason! voices of wisdom!! voices for main street!!! voices from corners within the system that see this for what it is... a transfer of junk to the people.

so, excitedly, i began to read the article. and there it was....

..... Some analysts think the most important steps to avoid another depression may have already occurred without the $700 billion bailout.

"Last week we came real close to a financial economic meltdown because of the run on money market funds, resulting from the bankruptcy of (investment bank) Lehman Brothers, and I think insuring the money-market funds was enough," said Ed Yardeni, a veteran Wall Street analyst. Last week the Treasury announced a $50 billion insurance plan for money market funds, which restored confidence in them. "It wasn't necessary to move to Plan B."

Doubting the financial Armageddon scenario, Yardeni said another measure that could have the same effect as the $700 billion rescue plan is simply to change accounting rules for bad assets - mostly bonds with mortgages as their collateral.

Right now, banks and others with this toxic debt by law must write down losses every quarter. They are forced to put a present-day value on these assets. Yardeni thinks suspending this rule could do the job without taxpayer money.

"There are quite a few of us who think that could have stabilized the situation quite effectively," he said, adding, "I think it (the bailout) was rushed, and certainly we didn't give other reasonable, cheaper alternatives a chance. But at this point it is what it is, and we all have to pray that it works." (end excerpt)

this is a solution? the marks weren't real in the first damn place! the argument is that "innocent bystanders", good, secure, low risk inverstment vehicles are victum and the investors of these are being victumized. i have but one reaction to this.... you plays the game, you takes yer chances!!

and debt write down is not the only thing they have to do. they have to answer to their margin calls. margin. borrowed money used to play for more money. now, thats a real sound bid'ness practice eh? what would the bank down on the corner say if you or i walked in there and tell them we want to borrow money? they're gonna ask what for? is the underlying asset we want to borrow money for collateralized? is it worth more in the street tha the loan in case i default? and we're gonna tell them there is no real goods involved? we're going to invest the borrowed money? they'd laugh us right out of the bank!! they'll do it themselves (with our money) but they won't do it for their depositors. unless we're doing bidness with an investment bank. they loan paper to invest in more paper. or they did!

let it burn and let entrepreneurship rise from the ashes?

personally, i agree. thats the thing to do. let it burn. but i don't think it is or will bring a "solution" either. this situation is systemic, it is people related, and it is global in scope. aside from the very fundamental fact that there is really no such thing as free marketry except in theory, as long as people are involved there is no such thing as free marketry. entreprenuership comes from people. and the ones with enough clout, with enough cash and position or control to actually move toward take over positions are ate up with the same damn thing as the ones who put us in this position AND including the us who co-opted it by entering their schemes... ahhh, i mean markets.

in a word?

greed!

pretty catchy stuff, greed.... catch it on your fingertips and it just crrraaawwwwllls right up your sleeves.

personally, there is no solution except to deal with the human condition. which is exactly what universe is up to. it will be as ugly as we've made it.

Palooka's Revenge said...

part 2.... The End of the World As We Know It.

i subscribe to john mauldin's free weekly newsletter. mauldin is an analyst who runs the "thoughts from the frontline" website. his current letter which goes to 1.5M subscribers is in the form of an open letter to his congressman in which he argues for the bailout and gives his reasons why. though there are terms, concepts, and charts most of us street people won't understand (the TED spread, the LIBOR, tier 1 commercial paper, etc), and though it is lengthy, i am suggesting everybody read the letter as it explains why, as mauldin puts it, "It's the End of the World As We Know It".

those words coming from a highly respected, mainstream analysist! thus he argues for the bailout which he sez should be more correctly referred to as "an economic stabilization plan".

imo, there are some key paras in the piece....

......."We all know about the subprime crisis. That's part of the problem, as banks and institutions are now having to write off a lot of bad loans. The second part of the problem is a little more complex. Because we were running a huge trade deficit, countries all over the world were selling us goods and taking our dollars. They in turn invested those excess dollars in US bonds, helping to drive down interest rates. It became easy to borrow money at low rates. Banks, and what Paul McCulley properly called the Shadow Banking System, used that ability to borrow and dramatically leverage up those bad loans (when everyone thought they were good), as it seemed like easy money. They created off-balance-sheet vehicles called Structured Investment Vehicles (SIVs) and put loans and other debt into them. They then borrowed money on the short-term commercial paper market to fund the SIVs and made as profit the difference between the low short-term rates of commercial paper and the higher long-term rates on the loans in the SIV. And if a little leverage was good, why not use a lot of leverage and make even more money? Everyone knew these were AAA-rated securities."

there it is in one para.... the SHADOW BANKING SYSTEM, EASY MONEY, LEVERAGE, and OFF-BALANCE-SHEET VEHICLES. in this case SIV's. and damn near everybody who has a pension plan, an ira, 401K, etc, etc, etc, is IN. most out of ignorance. ignorance may be bliss but it is no excuse. i know it spells big trouble for everybody but as long as this kinda shit is going on, as long as there are major players involved that created the monster in the first place and street people who don't give a shit as long as they make money, any "plan" to stabalize is merely a bandaid!!!!!!



.........."Because banks and investors and institutions are having to deleverage, that means they need to sell assets at whatever prices they can get in order to create capital to keep their loan-to-capital ratios within the regulatory limits.

Remember, part of this started when banks and investors and funds used leverage (borrowed money) to buy more assets. Now, the opposite is happening. They are having to sell assets into a market that does not have the ability to borrow money to buy them. And because the regulators require them to sell whatever they can, the prices for some of these assets are ridiculously low."

he goes on to give some examples of innocent victums. well the poor babies! they preach free marketry but when they get a dose of it they can't stand it. that, btw, is the basis of the argument for nixing the mark to market rule.



.......Now let's look at the next chart. This is the amount of Tier 1 commercial paper issued. This is the life blood of the business world. This is how many large and medium-sized businesses finance their day-to-day operations. The total amount of commercial paper issued is down about 15% from a year ago, with half of that drop coming in the last few weeks. Quite literally, the economic body is hemorrhaging. Unless something is done, businesses all over the US are going to wake up in a few weeks and find they simply cannot transact business as usual. This is going to put a real crimp in all sorts of business we think of as being very far from Wall Street.

what the hell is tier 1 commercial paper? this is how large and medium bid'nesses finance their daily ops? by borrowing money? mine is small. very small. but it is a business. i finance it with cash reserve. why can't they? if i want to expand and need to borrow to do whatever? well, thats one thing. but having to borrow money to finance daily ops as a matter of SOP is quite another. no wonder this thing's coming apart!!

is it the end of the world if they don't cut a deal? probably.

how 'bout if they do? probably. in my view at least.

read for what its really saying. or should be. it underscores that, not only are there rotten apples in the barrel, the whole barrel is rotten. a rotten barrel's attempt to fix itself. but then, many of us know this. we just don't know why except that, at the core of things is the structure of the finance system fueled by greed and hell bent on "easy money". co-opted by the human condition. and right now, the human condition is facing the reflection of its denials. denials that include subtle and not so subtle alignments on energetic levels on the part of we, the street. denials on the part of those who run our finance system. tune in to any finance teevee station that have cameras on the pits. watch the sharks at the feed. acting on their clients behalf and ours. its a system that would not operate if we, the street, did not co-opt it.

do we have a choice? damn right we do! or did. but its a little late for most.

link.... http://www.frontlinethoughts.
com/index.asp

freeacre said...

Thank you, Palooka, for that reasoned explanation of what is going on.

We just watched the 60 Minutes interview with Henry Paulson, the Secretary of the Treasury Who Would be Emperor. Funny, isn't it, how they just happened to be "following him around" the week that the collapse came to the fore. What a COINCIDENCE, eh? Happily, they were there to show us how he's been losing sleep worrying about how to save us taxpayers. What a guy. What a load of bullshit.

I am so fed up with this propaganda empire they call the news. Everything changed when the news anchors began to be paid millions of dollars to broadcast this swill they call news. Now, the television elites are members of the Council of Foreign Relations, they attend the Bilderberger meetings. The same pundits who have been wrong and complicit in every sick policy that they government and fat cats have done continue to sit there with no consequences for the lies that they spin year after year. All the independent thinkers and writers on the internet are never given a voice.

Well, fuck that. It's time to shun them like the moral lepers that they are. Let them rot in their own filth. They are unworthy of our time, our attention, our respect, or our money.

If we shun their programing, their schemes, their useless gadgets and products, we'll be exercising our power, for once, and begin to take our country back. We vote with every dollar that we spend. If we withdraw our dollars from them, the matrix will begin to crack.

What is the antidote to greed? Generosity. What is the opposite of fear? Love. What is the alternative to exploitation? Sharing. What can we do to shed our collective sense of powerlessness? Be free. Be courageous. Be productive.

Palooka is right. There is more to this than money.

It's going to take the rest of our lives to begin to put together a new paradigm.

We are going to have to reach out and help each other, because it is going to be tough. We will need to be strong and productive and imaginative, and compassionate and smart.

But, that's not a bad way to spend the rest our our lives, I reckon.

Anonymous said...

Freeacre;

It is a sad commentary on the times, to see selflessness as a subversive act, but in this instance, your suggestion is both timely and dead-on.

They need us to be afraid, so we must be brave.

They need us to devolve into hatred, so we must love one another.

They need us to cling to the material world, so we must embrace the light.

They are losing their grip because we are awakening to their lies.


"...Though lovers be lost love shall not;
And death shall have no dominion."

- Dylan Thomas

-rockpicker

Anonymous said...

Whoa! The DOW down 777 points! I'm thinking on making a few little voodoo dolls of my state representatives (traitors/crooks) and do some pincushion action on their asses. If it doesn't do any good, well, maybe I'll call Palin's Witchdoc to help me out if it lacks the voltage I need to send a message to my state reps/criminals.

From what I've clicked-on this afternoon, there are hundreds protesting outside Wall Street. One sign said, "JUMP! You fuckers!" I love it!

Anyone want to guess as to what will happen tomorrow? I think we're toast, but that's just me.

Dude

Anonymous said...

Are there words to "Wipeout?"

-rp

freeacre said...

Take a look at the U Tube videos of the protests on Wall Street. I especially like the sign that reads, "Jump, You Fuckers!"


http://hubpages.com/hub/Protests-on-Wall
-Street---what-the-news-media-isnt-
showing-you

Palooka's Revenge said...

Anyone want to guess as to what will happen tomorrow?

congress is deserted. jewish holiday tomorrow. next potential vote? thursday. so what are they doing wednesday?

i had heard asian and aussie mkts were down over 10% in pre-market. dow futures also down. not the case at the moment.

volatility is the operative word. there and here. i caught the last 20 minutes before the close and saw wild fluctuations in very short periods of time. when i turned it on it was down 640. lowest i saw was around 540. a minute later it would be 620. etc. and a solid 150 point slame down at the close. over 1T in market cap lost.

lotta dick and jane's crying tonite! probably can't even bring themselves to look at their portfolios. and undoubtedly some at least struggling with a dicotomy of feelings. panic over their losses midst their disgust and rage at the sharks and politicians.

me? somewhere something is smiling. jumping for glee even. for someone who views the markets as against his "religion", why should i care? why watch? well, it satisfies some warped sense of justice somewhere i guess. perhaps sinister even. hidden in the shadows. crooks eating crow. and the lemmings a long and well deserved reality check. but the reality is their so-called american dream has been hijacked. and i have no sympathy for anyone who bought into the fantasy in the first place. fantasy? you betcha. imagine 6.5 billion people all at the top of their own mountain. and there wouldn't be anybody to look down on. thats at least half the fun for the mountain toppers. i'm gettin otta hand here so i better stop.

but not before this...

The Federal Reserve will pump an additional $630 billion into the global financial system, flooding banks with cash to alleviate the worst banking crisis since the Great Depression.

thats from bloomberg. guess what the dateline is? today! yeah, the 700B deal got defeated today. but it'll pass in some form before its over. probably this week. so add those together. thats 1.3 TRILLION in a week! thats 10% of the GDP!!

http://www.bloomberg.com/apps/
news?pid=20601087&sid=ahwz_
k5JvuB8&refer=home

and does anybody see anything rotten in denmark here? its argued bid'nesses, companies, employers, etc can't get money for inventory and overhead capital and make payrolls etc cuz the banks aren't lending. thus 700B is needed to open up the credit market and get the wheels turning again. credit means a source for cash. operating capital. and the fed just pumped 630B into the system? today?? hummm.... and not a damn peep about this move otta MSM.

and the glee smiles again...

Palooka's Revenge said...

540 lowest? uhhh... correction, how bout highest.

gas in atl? got a job going. 75 miles round trip. needed a reload this morn. pulled into the line with about 15 in front. and this one with only 3 twin pump stations. line moving fast though. so i'm thinking, hell, everybody's just topping off. not! $17 limit!! that was about a spoonfull over 4 gal. won't even get me round the horn. 3 clerks outside directing traffic. AND, making sure nobody went out and came back in for another 4g!

i counted stations on the way over... 26 no gas, 7 gas. long lines at most of those. one well over 50. all the megas like quik trip with a gazillion pumps were out.

turns out there's an E85 station on the other end down the street from the job and they had both reg and E85 with no limit. i pumped some reg and toped off with E85. no, i'm not driving a flex fuel. research telling me vast majority, if not all, vehicles newer than '83 can run 50/50 with no probs. apparently the computers can handle the mix and necessary adjustments are within their limits. i.e., higher octane. (not advice... DYODD).

all of my guys been testing it by running about 30% for over a week now. my mix turned out to be 25%. this is my first go at it (no supply near where i live and only 13 stations in entire metro area). no noticable probs on way home.

price? payed 4.30/reg. 3.40/E85.

why no line at this one? beats me. people fighting over it at some stations. only thing i can think of is it was a citgo station. i know for a fact some people see CITGO and read CHAVEZ. no way. say they'd starve to death first. maybe its true! thing about it is, i thought chavez dumped the u.s. retails about 2 years ago (can anyone confirm that?). told that to one of my builders and he said, i don't care, it still sez citgo and i ain't givin 'em a dime.

murph said...

Palooka,

I gather E85 is 85% ethanol? We got only 10% in Oregon. Did notice a drop in mpg though when I couldn't get non blended anymore. Geez, $4.30 for reg? incredible. We're still at the $3.80's here.

Got to admit I don't understand the complete antagonism to Chavez. Somewhat similar to American fries instead of French fries? Just what is it they are so mad at him for? Because the government says we should be? At least he had the gumption to tell uncle Sam to shove off. I haven't looked it up but I think it is true he dumped all the retail outlets in the U.S.

I also figure that while a bunch of congress critters are taking time off the PTB will figure out how to snooker some form of the bail out (not rescue plan, not economic stimulus plan, not save the economy plan) through. Near as I can see, won't help in the end anyway, just put more money into the big boyz pockets. And when it all comes tumbling down anyway, guess who will get blamed. sigh.

Palooka's Revenge said...

murph... yup. 85%. chavez? probably the link to the S word. like democracy and free marketry even, socialism's not a bad idea in theory. throw people in and you got a prob in application. add guilt ridden people and you got a BIG prob. add frozen, polarized POV's, pre-conceived notions, misinterpretations, and twisted ideaologies and you've got a cluster fuck.

we have several forms of socialism here. and not uncommon for the haters of the S word to go absolutly nutzoid when somebody threatens their entitlements. its a real comedy of errors to watch.

ya, he told the u.s. to fuck off. with good reason too. if we study our track record for hijacking 3rd world resources in exchange for massive debt. and assination for any would-be players that refuse to play. a pdg chronicle are the books of john perkins, former economic hit man. in most cases, its been successful. from the u.s. view of course. chavez is the most notable exception. and castro of course.

word is chavez sits in front of the teevee camera for hours reading greg palast's "armed madhouse" to the masses. and he's bailed out alot of his neighbors up against the pay or play pressures of the u.s., imf and wb.

ya gotta wonder about the underlying energies in play here and the various denials, etc of the main players. a lot smarter guys than chavez and castro got on airplanes and never came back. i think we call it spreading democracy.

RAS said...

I love that sign. I just wish they would jump. ;-)

MSM is covering the gas shortages down here a bit. I saw this article on the Washington Post: http://www.washingtonpost.com/wp-dyn/content/article/2008/09/25/AR2008092504159_pf.html
It seems to confirm that Atlanta, at least, is sezing gas for municipal use. Surprise surprise. The cops had better have locking gas caps or guard their cars when they park, or they'll come back to find an empty tank.
I have to go get gas today. Wish me luck.

I felt almost gleeful yesterday after the dow melted down. It's about damn time.
aho

Anonymous said...

Here's something to take your mind of the waiting game.

More black hole talk from Stephen Crothers over at Thunderblog.

http://www.thunderbolts.info/thunderblogs/guest.htm

Also, checkout Ben Fulford's piece on jeff rense.

-rp

murph said...

rp,
Which Fulford piece on rense? post link?

RAS said...

I didn't have much of a problem getting gas after all. The stations around my house are all open, though most only have regular and there were lines. Not bad, just about 15 minutes. I paid $3.55 (I got it from a certain big box retailer that sells it discounted), but most of the stations are charging $3.99. It's come down a bit but not much.

I went into the store to see what was going on. There were some very large gaps on a lot of the shelves. Milk and bread are there but a lot of things are not -there was a lot of empty freezer space, a lot in the meat bins, some of the vegetables, etc. It makes me wonder if maybe they're having
trouble getting diesel and are prioritizing delivery of the items with the fastest turnover rates.

P, I bet if Citgo were the only stations open, those people would all change their minds real fast.

Anonymous said...

Murph;
The piece is titled "The American People Must Grab Their Freedom Now."

http://www.rense.com/general83/grab.htm

Sorry.

-rp

murph said...

rp,

Finally got to the article. Thanks. You believe all he has to say?

I don't know about this unprecedented prosperity thing. One other item, I know of no government that doesn't use the most advanced technology they have. All that he names sure has been kept secrete and isn't in evident use. Lots of hearsay, no real data on that. He sure seems far out to me.

Anonymous said...

The Huffington Post is reporting that McInsane won't get the electoral votes to become Warlord.

Which means.......Darth Cheney will probably set off another false flag attack so our Brain-Donor-N-Cheif can declare marshall law and cancel the elections. Whoo hooo! Can't wait!

Dude

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