Ok…. so not really, but what he stated isn’t too far off as ghosts are just as factual as the “imbalances” he claims are responsible the global recession.

Strauss-Kahn,_Dominique_(official_portrait_2008)

So what did he say?  Well, as usual, his improvable opinion, has to wrapped up in provable facts; the “global imbalance” (whole thing here via International Business Times):

…while the recovery is underway, it is not the recovery we wanted. It is a recovery beset by tensions and strains—which could even sow the seeds of the next crisis.

True.  Not only true, but also the reason why Egypt can’t be obviously predicted, as even the protesters are fighting amongst themselves.

Why?

Because the protests were born out of economic conditions and not a desire for freedom or Sharia Law.  This is why you can see the same unrest in Yemen, Jordan, the Sudan, and other countries.

This isn’t to say that a small faction, even a weak faction in Egypt like the Muslim Brotherhood, could never end up in charge.  They could.  They could use the fractured protesters against themselves towards their own aims and possibly turn Egypt into an Islamic state much like Iran.

This is a real fear.  & combine this possibility with two major changes coming to the Middle East:

1.  Iran getting *nuclear weapons with little more than talk from the international community; demonstrating they believe they are in a comfortable position of strength.

*(in 2015 or  2012, whether you believe public reports from Israel or the UK respectively)

2.  *Possible withdrawal of US forces from Iraq, leaving Iran very strong militarily.  They will immediately become the largest and most capable military force than all others in the region (great article via Stratfor).

*(Iraq doesn’t wish to be controlled by Iran anymore than the US wants this to happen.  So it’s possible the Iraqi parliament votes to keep US troops in country for insurance.)

People are naturally worried.  Either one of these alone is reason enough to fear instable states might flow towards Iran’s ideology, but when combined with everything else, concern is warranted.

The media of course has done what they do best.  Put up a false dichotomy by breaking this into only two sides; Egypt is becoming either an Islamist State or a Free Paradise.  The facts on the ground don’t support any particular conclusion at this time, but it’s tougher to write about that.

Just remember when reading the press reports that just a few short years ago most of these people were telling all of us how great Iran would become after the Green Revolution…. but I digress.

Our IMF Chief continues, using the factual and obvious instability in many countries, by warning of global imbalances, specifically (speech cont’d):

Growth in economies with large external deficits, like the U.S., is still being driven by domestic demand. And growth in economies with large external surpluses, like China and Germany, is still being powered by exports. As the IMF warned in the years leading up to the crisis—and as the G-20 has emphasized—these global imbalances….

Which is another fact.  There are trade imbalances between many countries with respects to China and Germany.  But then his facts stop, even though his words do not. (more…)

Infinite Monkey Theorems

Things worth reading…   

or at least pondering and forgetting quickly… 

So… how good is China’s new stealth fighter?  Not sure, but I’d start by asking this guy(here via MSNBC): 

HONOLULU — A former B-2 stealth bomber engineer was sentenced to 32 years in prison Monday for selling military secrets to China in the latest of several high-profile cases of Chinese espionage in the U.S.

US economics…

Businesses have not yet started hiring as UE claims are up.  Some of it is due to delays due to weather were people who would’ve claimed last week didn’t, but still not a good sign (here via BizTimes.com):

New applications for U.S. jobless benefits jumped by 51,000 to 454,000 last week, the U.S. Labor Department reported today, up from 403,000 during the previous week….

The four-week average of new claims, climbed 15,750 to 428,750, the highest level in two months, the Labor Department said. 

Additionally, the CBO reported this week, what all politicians have known for decades, but have consistently ignored…. social security is a looming and ever-growing problem (here via EpochTimes): 

In its Budget and Economic Outlook report for fiscal years 2011 to 2021, the CBO anticipates that the Social Security program will run a $45 billion deficit for 2011, and will be in the red for at least the next ten years. 

And…

According to the Associated Press, if present Social Security spending and funding levels are sustained and adjusted for the coming influx of Baby Boomers applying for and collecting Social Security checks, the program’s trust fund could be emptied by about 2037.

President Obama’s thoughts about this re: State of the union speech… no problems at all… full remarks here:

Starting in 2011, we are prepared to freeze government spending for three years.  (Applause.)  Spending related to our national security, Medicare, Medicaid, and Social Security will not be affected.

Not “affected’?  I guess that doesn’t discount it from affecting us…. but why worry about that when we can spend more money on things we don’t need (speech cont’d):

Next, we can put Americans to work today building the infrastructure of tomorrow.  From the first railroads to the Interstate Highway System, our nation has always been built to compete.  There’s no reason Europe or China should have the fastest trains, or the new factories that manufacture clean energy products.

Tomorrow, I’ll visit Tampa, Florida, where workers will soon break ground on a new high-speed railroad funded by the Recovery Act.

That’s some vision there; to ignore the looming crisis and instead deflect to a new boondoggle.  & not just a boondoggle, but it seems this is the answer to so many of life’s troubles… the environment, traffic congestion, sprawl…. yes, this magical elixir that is so incredibly great, that it can’t possibly survive without federal government to operate.

But wait… it will create jobs!  (speech cont’d):

There are projects like that all across this country that will create jobs and help move our nation’s goods, services, and information. 

Of course if it’s a “jobs’ program” and not a new transportation program (look over here – shiny stuff)… well, let’s let Milton Friedman discuss jobs’ programs (here):

Milton recalled traveling to an Asian country in the 1960s and visiting a worksite where a new canal was being built. He was shocked to see that, instead of modern tractors and earth movers, the workers had shovels. He asked why there were so few machines. The government bureaucrat explained: ‘You don’t understand. This is a jobs program.’ To which Milton replied: ‘Oh, I thought you were trying to build a canal. If it’s jobs you want, then you should give these workers spoons, not shovels.’

Either way, here is a good response to the State of the Union from Cato.

Lastly, more great stuff from the Economist.  This time an Ideas Arena

As business leaders, politicians and journalists meet at the World Economic Forum’s annual summit in Davos to discuss the year ahead, The Economist will be inviting readers and guests to participate in a series of online debates questioning the future of global leadership. From now until February 18th, we’ll be examining the rapid emergence of a single global elite whose decisions, and opinions, affect us all.

Not content with just blaming his political opponents for causing the Arizona terrorist attack, Paul Krugman also seeks to show us how his morals are better than his oponents as well.

In usual fashion of course, his framework is built on faulty assumptions, each which help his argument out a great deal, but all of which prove the fallacy of his thinking (full article here via NY Times):

One side of American politics considers the modern welfare state — a private-enterprise economy, but one in which society’s winners are taxed to pay for a social safety net — morally superior to the capitalism red in tooth and claw we had before the New Deal. It’s only right, this side believes, for the affluent to help the less fortunate.

Well, we can stop here, because the New Deal did not magically arrive at a philisohpical moral imperative which has been around for centuries.  Sorry Mr. Krugman, but morals are actually shared by most humans and this one is included regardless of your self-serving ability to not see it.

No, this novel concept didn’t begin in the 1930′s.  Most of us probably know or have heard the axiom, when much is given, much is expected.  Or this one, the idea that a rich person’s trip to Heaven is analogous to threading a camel through the eye of a needle (historically this meant using smaller entrances to walled cities, not actually a needle and thread).

But no matter, as for Mr. Krugman, the New Deal is the beginning of it all….. So where to go from here?  How about a false dichotomy (article cont’d):

The other side believes that people have a right to keep what they earn, and that taxing them to support others, no matter how needy, amounts to theft…

Notice the word play here in these back to back statements.  He sets up the framework as side A against side B, and while he doesn’t actually state that side B believes the less fortunate should fend for themselves, the implication in the setup is that this is the case.

Moving to his point however, (more…)

Well, we’re a week out from the terrorist attack launched by one lone individual on a small political gathering in Arizona and the trend is clear:  idiocy continues to press forward, non-exploitation of this tragedy seemingly illusory.

This time up, it’s Representative Peter King of NY.  Not to be outdone by Paul Krugman’s idiocy, Mr. King is trying to parlay one lone gunmen into a brand new set of gun control laws (here):

Rep. Peter King (R-NY) called for the gun-free zone in the immediate vicinity of federal officials…. he planned to introduce legislation next week incorporating his proposal….

It should seem obvious that this legislation has little chance of preventing or even acting as a deterrent to another such terrorist act, but not surprising the legislation is being pushed anyway.

As is usual with any legislation, it existed prior to the ‘crisis’ which was used as reasoning to pass it right now.  Truly the only way in which this is related to the Arizona shooting at all is in timing (article cont’d):

But many lawmakers have been concerned about the safety of themselves and their aides since Saturday’s shootings in Tucson and might be more open to King’s proposal than they would have been a week ago.

In a more perfect world, maybe we could point to this as the exception of a reasoned public debate, unfortunately this is just one of the idiotic ideas being pushed.

Their commonality?  Almost all arguments brought to the public so far ignore the very essence of a society: its culture.

Which is insulting to a degree; to think that given the wrong language or opportunity to carry a weapon near any sacred politicians, the average citizen might well use violence as a standard debate tactic.  However in America, and indeed most civilized societies, a basic thought is held by the vast majority of citizens is that the proper response to speech is speech.

For instance, we all know exactly what it means to say “sticks and stones” and as a society, we have a pretty firm belief that no matter what someone says to you, no matter how disgusting, no matter how insulting, violence is never an appropriate response to words.

To juxtapose, let’s look at the Islamists.

Their  religious and moral leaders constantly tell followers that violence is an appropriate solution to perceived or real slights.  They argue not just that violence is an answer, but specifically that it is a respectable solution even when it’s being used against those who are only using speech.

Remember the Mohammed cartoons?  That was 2005, but even in mid-2010 (more…)

Up until a couple days ago, I didn’t know who Freddie de Boer was/is. Apparently, he’s a semi-retired provocative and well known leftist blogger. What brought him to my attention is a puzzling headline from the Atlantic, Does The Blogosphere Permit Left Wing Ideas?

Puzzling in that I’m not sure what the argument would be, when the blogosphere is the definition of an open forum.  So I read further to find out that Freddie began the argument:

There are many myths within the political blogosphere, but none is so deeply troubling or so highly treasured by mainstream political bloggers than this: that the political blogosphere contains within it the whole range of respectable political opinion, and that once an issue has been thoroughly debated therein, it has had a full and fair hearing.

Um… okay.  I don’t know that I’ve ever heard anyone assert this “myth” before, don’t know anyone who believes it, and certainly don’t know anyone advocating it strongly.

I have heard several arguments along the lines of, the increase in the blogosphere has increased the number of views overall, but nothing like “media reports, blogosphere decide”.  In fact, many of those arguing that the blogosphere has increased the number of voices don’t agree that this has been a good thing, nor that it’s in any way equal in presentation of all ideas.   Just that it can help and has increased the total number of ideas available.

But I digress… the more puzzling part is this:

The truth is that almost anything resembling an actual left wing has been systematically written out of the conversation within the political blogosphere, both intentionally and not, while those writing within it congratulate themselves for having answered all left-wing criticism.

Puzzling because the one thing the blogosphere is above all else: a free market.  Yes, it’s not completely free as costs do exist, but costs for bloggers have been decreasing dramatically over time and are close to being zero from a casual level. (more…)

President Obama is planning to sign an executive order to review business regulations (via LA Times here):

WASHINGTON (AP) — Taking another step toward mending his relationship with the business community, President Barack Obama will order a review of federal regulations with an eye toward getting rid of those that stifle job creation and hurt economic growth.

Upon hearing this news, I was immediately reminded of the Simpsons’ episode.  The episode is about NASA, who having problems with funding, decides to put an average man in space for marketing purposes.  The press conference (here):

Scientist: Ladies and gentlemen and members of the press.  I’d like to
           present the new generation of NASA astronauts: the average
           American.
            [Curtain rises to show Homer wearing a "Hail to the Chef"
           apron and Barney dressed as a golfer]
Reporter: Jim Wallace, Associated Press.  [clears throat] Is this a
           joke?
Scientist: [cheery] Far from it, Jim.  One of these men will prove space
           travel is within the reach of the common man.
Reporter: Toby Hunter, Minneapolis Star.  No really, is this a joke?
Scientist: No, Toby, and no more questions about whether this is a joke.
            [Everyone lowers their hand, dejected]

Please don’t misunderstand – I’m hoping, like a lot of people, that the President is serious about this.  However, almost every single action taken by this administration shows an absolute love of controlling by regulations, even when no obvious reason for doing so exists.

This is after all the same President who gave us an executive order which prevented anyone from drilling for oil offshore due to one oil spill on a platform owned by BP (DA post here). 

This was all prior to the government report released late last year, which held BP accountable, but even after blaming BP for the entirety of the incident, they announced a month later continued blanket regulations against an all of the industry.

Even the President’s own fact finding commission is wondering what many others questioned before – what is this continued ban is supposed to fix?  They plan to press the administration on the issue soon.

And that’s just regulations for a small part of the energy industry.  This is also the same administration who pushed for financial reform.  Financial reform which as pushed before they had anyone had any idea what took place.  The reform which included controls on market segments which are known to have little to no impact on the financial crisis like hedge funds, derivatives, executive compensation and more (here & here).  (more…)

As an update to Wednesday’s post, the idiocy continues, in this case, with Paul Krugman (here via Daily Caller):

When you heard the terrible news from Arizona, were you completely surprised? Or were you, at some level, expecting something like this atrocity to happen?

Put me in the latter category. I’ve had a sick feeling in the pit of my stomach ever since the final stages of the 2008 campaign….

 Now it’s obviously impossible to know whether Mr. Krugman was honestly surprised about the horrendous events of this past weekend or not, but it seems hard to believe that anyone who heard about the incident thought, “yep – saw that coming.”

But in the grand scheme, it really doesn’t matter whether he was truly surprised as that’s not his main point.  Before he gets there though, he has to set up the framework (article cont’d):

…And you could see, just by watching the crowds at McCain-Palin rallies, that it was ready to happen again….

That’s some prescient vision he has there.  Without any proof, without any examples, without anything at all, he can “see” what was inevitable.  Not sure why he didn’t stop it or call for the possibility as loudly as possible.  It seems like the only moral actions when you “know” violent acts committed against innocent parties is inevitable. 

Additionally, this uncanny ability of his makes one wonder if the people from Miss Cleo’s office has contacted him yet to see if he’s looking for a career change?   Or maybe the CIA would like to test his capabilities?

But I digress, extra-sensory perceptions aside, Mr. Krugman continues framing the argument using a government report (article cont’d):

The Department of Homeland Security reached the same conclusion: In April 2009 an internal report warned that right-wing extremism was on the rise, with a growing potential for violence….

Which would be interesting to note, if only it were true.  There was and is a DHS report detailing the potential for increased radicalization and recruitment due to a very unique climate, but the report itself begins with this easily comprehendible statement:

The DHS/Office of Intelligence and Analysis (I&A) has no specific information that doemstic righwing terrorists are currently planning acts of violence, but rightwing extremists may be gaining new recruits by playing on their fears about several emergent issues.

The report continues as it details what it sees as specific climate variables for which rightwing extremist groups might exploit, but noted, in the 2nd paragraph the threats which concern Mr. Krugman so much, are “largely rhetorical and have not indicated plans to carry out violent acts“.

But Mr. Krugman sees, so a potential for increased recruitment and radicalization based upon societal factors and an increase in the potential for real harm are now the same.  I doubt that’s true for most objectively viewing the same data, but I don’t think most people think like Mr. Krugman.

Nonetheless, our vaunted author continues.  With an increase in threats (real) and vandalism (possibly real, no studies, no proof offered), Mr. Krugman’s vision sees the obvious results (article cont’d):

One of these days, someone was bound to take it to the next level. And now someone has….

Who was that guy again? 

It’s true that the shooter in Arizona appears to have been mentally troubled.  But that doesn’t mean that his act can or should be treated as an isolated event, having nothing to do with the national climate….

So even though Mr. Krugman believes the shooter is likely insane, the national climate is somehow involved.  Not only involved, but (article cont’d):

…something about the current state of America has been causing far more disturbed people than before to act out their illness by threatening, or actually engaging in, political violence.

His proof?  Increased levels of violence?  Increased crime rates?  Nope.  (more…)

The news about falling jobless claims has been continuing over the past couple months as new claims began to fall in late November, kicking off media reports in December about how great things were trending. In fact, not only were jobless claims receding, but even the 4 week moving average (here via ActionForex):

Initial unemployment insurance claims fell 34,000 to 388,000 for the week ending December 25th. The 4-week moving average of initial claims, a better indication of the underlying trend in labor markets, slipped to 414,000 from 426,500 the prior week….

Now for those of you unfamiliar with the end of the year in the United States, there’s this little holiday known as Christmas.  & with religious aspects aside, usually during Christmas in the US we see a great deal of increase employment due to need based solely upon Christmas cheer spending.  There are part time employees hired in all kinds of capacities such as catalog companies, larger retail stores, and even in restaurants as they see increased traffic as well.

Many actually interested in publishing accurate information, mentioned this repeatedly (article cont’d):

…This report needs to be viewed with a degree of caution given the significant volatility associated with the seasonal factors surrounding the Christmas holiday period and uncertainty as to whether these declines will be sustained….

Other accurate voices also noted another corollary; jobless claims drop for other reasons (here via ChicagoNow):

The national jobless rate for December dropped to 9.4% from 9.8% the previous month.  Unfortunately, the decline in jobless claims only dropped because 260,000 American job seekers stopped looking for employment last month,…

But you know - there’s reality & then there’s politics.  So many voices, quite pleased with a minor decrease of unemployment claims and quite willing to ignore the volatile season and other factors were ready to go to work.  After all, the numbers seem good for the President (here):

President Obama got some early New Year’s cheer Thursday — a positive report on jobless claims that increases the chances that next week will bring the first drop in the unemployment rate since June….

So why shouldn’t he market the glowing numbers on his website (here):

The number of Americans applying for unemployment benefits fell sharply last week, a positive sign that the U.S. job market is slowly improving….

With headlines everywhere reading this is the lowest rate in jobless claims since 2008 (here – they have pretty graphs too):

….The traditional interpretation suggests that the U.S. labor market, which has been a headwind for the economy, is improving as the economy slowly accelerates into the new year. New applications for unemployment assistance decreased by 34,000 to 388,000 (week ending December 25th). That is the lowest level since July 2008….

Prompting Mr. Obama himself to declare success (here via Bloomberg):

President Barack Obama said U.S. job growth is improving after a government report showed employers added 103,000 jobs last month and the unemployment rate fell to 9.4 percent in December from 9.8 percent in November.

In his weekly radio and Internet address, Obama today credited steps taken by his administration to reduce taxes and encourage business investment with helping to restore economic confidence and boost hiring….

The problem is that none of this matches reality. As was noted by many when the unemployment numbers were looking just great…. some employees stopped looking for jobs altogether and others were hired only for seasonal work. So the natural uptick is here via The Street:

The number of Americans filing unemployment claims unexpectedly rose last week, the Labor Department said early Thursday….

Don’t misunderstand, even with the uptick in jobless claims, there are still things that seem positive overall (article cont’d):

The four-week moving average in initial claims, which smoothes the volatility in week-to-week reports, was 416,500, an increase of 5,500 from the previous week’s revised average of 411,000….

Irregardless of what politicians and pundits say (even Nobel Prize winning ones), no matter how many people, no matter their collective resumes or IQs, no matter their fervor, and even for POTUS, or the Chair of the Fed Reserve, or their positions in life don’t matter to the two, very real things we actually know:

1) It’s too early to tell whether the volatility of the recent holiday season will or does have any impact on unemployment trends as a whole.

2) Even if the trend holds and the President claiming credit turns out to be prescient versus premature, let’s not forget.  We spent 1 trillion more dollars to keep the unemployment rate below 8% & by 2011, it should be around 7% (here via DA):

As all politicians told us not too long ago, without passing several “stimulus” bills quickly… way too quick to read (anyone remember the Patriot Act?), everyone would soon be looking for jobs as unemployment sky rockets.  Remember the 1.5 million jobs that would be saved?

So in the end, time will tell us what we know: increased regulations and taxes strangle business and decrease job growth and economic output.

For now, just remember the people telling you how great US economics are trending and how responsible their policies are for these successes are still a mile behind where they told us we’d be just a couple years ago.  As one other thing we do know, we’re still doing worse off than the government told us we would be doing had they one absolutely nothing (~10% higher UE than they predicted).

& when noting the fact that the stimulus they begged for and got; things make it look that much worse as we’re about ~50% higher than the government prediction:

Source: Michael’s Comments blog