The Economy and Poker Comparisons

A rather long, boring write-up on market reaction to the EU's proposed trillion $ aid package is here. But the segment I'm interested in is this:

“There has been a poker game going on between the markets and the EU,” said Gary Jenkins, head of credit strategy at Evolution Securities Ltd. in London. “This is probably reaching a climax as the EU has just gone ‘all in.’”

This is hardly the most egregious misuse of the phrase "all in", but it's not precisely accurate. Going all-in suggests that you've put everything you have on the line. In a tournament, if you lose, you're out.

But the economy isn't a tournament. It's a cash game. You go all-in there, then you may very well have some more cash in your pocket, or be willing to make a trip to Ye Olde ATM. In fact, if you aren't, then maybe you shouldn't have sat down in the first place.

And the opponent they're going all-in against in this case is a broke-ass degenerate gambler who's chasing more losses than he could ever hope to repay. This is the guy who has markers at every casino, have hit up all their friends for cash to the point where they don't have any more friends, been disowned by their family, and have five gorillas standing at the rail waiting to break their knees or take their money for the mobs they work for.

In short, they're going to call no matter what. Then, regardless of the cards, they're going to take all the cash and run for it. By the time the EU catches them, they'll have lost all the money and be sitting at another table.

And the EU will pull out its ATM card and reload.

Economic Thought For The Day

The Great Depression was ended by WWII, not by any monetary policy considerations of the administration of the time. WWII ended it not by upping military production (which is just more government stimulus), but because the rest of the world's major manufacturing base was destroyed, leaving the US/Canada to pick up the slack for the world. Our still intact production lines had the rest of the developed world as consumers.

Now? Well, unless you see another global war where the "West" remains untouched coming, it'll take some old-fashioned time and common sense to restore financial stability.

A Thought

A while back, Canada had 3 major airlines. Air Canada, CP Air, and Wardair.

Air Canada was government owned, CP Air (formerly Canadian Pacific, later Canadian Airlines) was your everyday publicly owned company with stocks and such, as was Wardair.

Wardair had fantastic service, great meals, and was the smallest of the three. They were eventually bought by CP Air (leading to the change to Canadian Airlines). There were two big players in the market.

Canadian had struggled throughout their existence, like most airlines do. Air Canada, being owned by the government, was "debt-free", and the bigger dog.

Then the government decided to sell Air Canada off. It became a public corporation just like Canadian. Then the usual airline downswings happened, and competition between two large airlines in a country with fairly low population density was looking unfeasible. They merged, with Air Canada taking over Canadian by government decree. Why? Because Air Canada was the one in the better position. To speak to Air Canada employees, it was because they were the better company and that their competition was never good at running a business. Woe be they who reminded them that they were born, raised, and matured as a wholly-owned government agency. So when they finally became public, they were debt-free. It had nothing to do with running a business and everything to do with taxpayers footing the bill for decades.

Soon enough, they went bankrupt too, then again, then almost again a few weeks ago before refinancing like mad.

The point? That government corporations have built-in safety net with the taxpayers. The reason private companies can effectively compete with them is because they are so INefficient that if it wasn't for this net, they'd be dead.

I can't imagine a parallel that could be drawn in the US right now...

When You Don't Need It

Good ol' Helicopter Ben Bernanke is sitting in front of the Senate Banking Committee and spinning his usual bullshit.

But I want to focus on one thing that's been consistent throughout this whole debacle - the constant pressure for banks to lend to "creditworthy" customers.

What's the old saying? Banks only lend you money if you can prove you don't need them to.

The people who have good credit are those who have shown that they have the ability to spend within their means. Mortgages used to only go to people who could show that they'd EVENTUALLY have the money for the house anyway - after all, that's what you're doing with a mortgage, slowly buying your house - but only had a percentage of that money on hand. Same with business loans - you've proven that your business can pay off the loan, and if you'd just save the money now, you could eventually pay for it yourself.

But loans exist because of time. Sure, a business owner could put $1000 a month in the bank for 5 years and have $60,000 to renovate or expand the business. But in 5 years, that $60k won't buy as much, and it's 5 years of the business getting by without the changes. So the owner goes to the bank, shows that he has an extra $1000 a month, and the bank exchanges him $60k for that $1000 every month. This way, the owner can make the changes now, reap the rewards, and he eventually has paid off that $60k, plus some interest, which is for the convenience of having the money now.

That all changed during the credit bubble.

Rates got so low, that the interest became inconsequential. Banks weren't going to earn much on the loans, so they needed to make more of them. They loosened the standards because the collateral being used - largely real estate - was going up, up, up in value.

And then it collapsed, and everybody who should never have seen a loan in the first place defaulted on them.

The banks tightened the purse strings, and were responsible again for the first time in nearly a decade. They're getting berated for being financially sound in their decisions now, because the world has become so used to living on borrowed money that they can't remember fundamental economics - if you don't have the money, don't buy it.

And now the pressure is being reapplied - lend to the creditworthy! It used to just be "lend!" now they've added a qualifier so as to not piss people off. The problem is this: The creditworthy are too smart to borrow money.

They've saved. They've taken note of what they can and can't afford. They look at investments and determine what is actually a value play instead of just a dream and crying call of a purchase in hopes of positive return. And they're patient.

The business owners who have solid credit scores are biding their time. The addition on the building can wait. The expansion plans aren't necessary right now when business has dropped. The upgraded equipment will still be available in six months. The money can be saved with minimal concern at this point, because it's better to have a cushion of cash than a black hole of debt. Those that DO want loans will shop around for the best rate, and they'll minimize that loan by finding opportunities that offer the best value. If they need $20,000, they'll ask for $20,000. They won't take the $100,000 they'll be offered, because they don't need it.

The point being - you can't lend to customers that don't exist. The pool of borrowers has dried up to a puddle, and the fish aren't jumping. Turning up the heat on the banks to lend to the creditworthy at this point means redefining "creditworthy", and that's what go us into this mess in the first place.

Meet the New Boss, Same as the old Boss

GM's out of bankruptcy.

Yah, it was 16-year old boy fast.

Well, it's not REALLY out of bankruptcy. See, the "new" GM is out of bankruptcy. Because the "old" GM sold all it's "good" stuff to a company it created that's owned by the US gubmint, the Canadian and Ontarian (really? we're seperating? sweet!) gubmints, the "old" GM bondholders, and the unions. So the brands they're keeping (Chevy, Buick, Cadillac, GMC), and they stuff that still works is in the new company. All the crap? The shuttered factories? The debts? That's with Motors Liquidation Co., or the "old" GM, which will probably never be out of bankruptcy.

How awesome a shell game is that?

You go bankrupt, shove all the bad crap into a generic company and leave it in bankruptcy, and sell all the good stuff to the government and come out with the same name looking all sparkly.

Management will be cut by 20%, and executives tiers by 35%. Around 40% of the dealers are gone, and health care and pension obligations are down $48 billion too.

The promises of fuel-efficient and hybrid vehicles will come to fruition, honest! They'll make cars people want, fo reals! No more executive bloat! Labour costs down! Rainbows and puppies and lollipops for everyone!

Bull. Shit.

There's been a lot of shuffling at the top, there's a new boss, and a whole whack of debt to the American and Canadian taxpayers. The union will sell their share as quickly as possible because they just want the cash, not the responsibility. That way, they can also start holding GM over a barrel again if times get good. Their labour costs may be in line with Toyota and Nissan and the like now, but that will change over a couple decades. If they last that long.

It all smells like crap to me. There will be token gestures. Designs won't be innovative, because that would involve taking a risk, and risks are scary to suits. Expect more cars that look the same as every other car on the market. Expect minor improvement being sold as the second coming. Expect deals and cuts and a million other incentives to buy overpriced vehicles. Expect that eventually, it will be bloated again with focus not on car quality or consumer happiness, but the bottom line and exterior businesses that make more money for them. Why? Because building a fuel efficient car that is fully-loaded and will work for 10 years without needing major service means less sales, less secondary money from the GM service shops, less loans, and more need to keep improving enough that people WANT to upgrade.

GM is floundering. Every commercial, every press release, every piece of news stinks of bullshit and death to me.

The silence from Chrysler is deafening.

Ford, oddly enough, is actually sounding honest. As honest as an American car company can at least. They've had an extra year to get their shit together, having gone bankrupt before the credit crisis. They've jumped on the opening made by their competition's problems and the fact they didn't need taxpayer money to surivive (thanks to the loans they secured when they went under). I don't think they're being revolutionary, but they're playing to their strengths - trucks, the Mustang, and small fuel-efficient cars that have already worked in Europe. All they're doing now is talking about them, and juicing them up a bit. Are they the "new Ford"? I don't think so, but they're newer than the "new GM".

China's Laughing

I might as well link to Mish again, since he's got the important parts up.

Yu Yongding, is a former advisor to China's central bank. He publicly asked Tim Geithner if he could see his math on the idiotic lies that the Fed and Gubmint have been spouting about how they'll lower the deficit and keep the dollar strong.

He then called the US, "the world’s biggest junk investor" and then said the Fed has dropped “tons of money from the sky since the subprime crisis.”

When Geither spoke at Peking University (I'm surprised it would still be called Peking U), he assured the crowd of students that Chinese assets (those billions, if not trillions of dollars invested in US treasuries and such) were very safe, the auditorium of students broke out in laughter.

China isn't full of idiots. Sure, they may be sequestered, blocked from free information, and under government control, but they aren't all uneducated country bumpkins. And they've got the best bullshit training in the world dealing with their government... you think Geithner can convince them that a single turd coming from his hole is gold?

China also dumped some big money in stimulus packages. You know where it went? Manufacturing and industry. They showed growth last month. Sure, it's artificial, but it's more useful than bailing out banks.

They're starting to realize they have the power in this partnership now. Others will smell the sick economic carcass of Uncle Sam too. Then things will get... interesting. Or maybe your leaders can get their heads out of their asses and do something useful for a change.

Debt

I imagine this is largely being preached to the choir at this point, but there's a basic underlying truth that drives the US economy. On average, US citizens are in debt.

The current household leverage (debt:income) stands around 130%. There are lots of pretty graphs and figures and discussion here. It was around 133% in 2007. It reached those ridiculous heights in about 20 years, more than doubling where it was in the mid-80's. THIS was the driving factor behind the boom that went bust. Now, with people under water, trying to find the surface, the government is trying to stimulate spending and growth. The reality is that until people get their debt down to match their spending (ETA on that? Around 2018 if people try), the US economy will remain on a bubble.

In 20 years, the US went from a nation of savers to a nation of debtors. Until that foundation is built up again, the world's largest consumer market can't honestly recover, especially since your economy is based on consumption and spending now instead of production and exports.

Let's See What Happens

I wonder if I can pull a rant out of this. I'm feeling a bit tired today, so it may not be in me.

There's a couple decent reads here and here. Both criticize Franky Roosevelt's post-depression actions. The first claims his moves extended The Great Depression by 7 years, and the second points out the economic idiocy of the New Deal and why Democrats are fools for blindly accepting it as the thing that saved the economy.

They're both fairly common-sense and free-market oriented. It boils down to the same thing that is being said by the ignored - artificially inflating the economy achieves nothing but an air pocket. Bailing out banks in order to create unworthy credit flow means that we'll face another credit crunch in the future. Bailing out automakers to save jobs means there will continued to be overpaid, underworked employees making crap with nobody being held accountable. Circumventing established free market and corporate procedures to look like you're doing something results in an artificial economy that WILL collapse under its own bloat. And to do all this, the burden is ultimately placed on the shoulders of the taxpayers and those who did the RIGHT thing and have managed to stay solvent in these times.

As I said earlier, the reason the US thrived after The Great Depression is because they were one of the only fully-equipped countries in the world for manufacturing. They provided the cars, the construction equipment, the raw materials, and the transportation of these things to the war-battered nations of Europe and Asia. The US practically rebuilt Japan. They PRODUCED material objects that could be bought and sold for REAL money. On top of that, they built good will and made allies. The US nuked Japan... TWICE, and then became its biggest trading partner. How the fuck does that happen?

There is no such opportunity in the future. Manufacturing is outsourced and globalized, and in no danger of being physically destroyed. The US has spread only ill will to the world, be it Bush's hamfisted foreign policy or the continued economic crisis that's spanned two administrations. I'm still shocked Putin has declared the entire thing the US's fault and restarted the cold war.

And the unwillingness of the entire world (save New Zealand I think) to let the free market be a free market, and let the failures collapse, just leads to more artificial wealth and forced "green shoots" that are already dying from the lack of a root system.

In the end, the current times will be seen as a strange hump before a return to old lows that will drag on for years. Eventually, the government will give up, because someone will look at the books and realize they were insolvent a long time ago.

Obama's a nice guy... so far, he's a floundering president who increasingly disappoints with his scattershot approach to various issues in the hopes we miss the epic failures that his administration is continuing. Perhaps he needs to hire a few of those dissenting voices he claimed he wanted in his cabinet, instead of morons who spew the same bullshit reasoning and flaccid arguments for their unrealistic policies.

The Book Of Chrysler - Chapter 11, Verse 1

And thus it was spoken : No agreements shall be made outside of the protection of the bankrupt. Only shall concessions be found when protection is granted via bankruptcy. The number of thy counting shall be 3, and 3 shall be the number of thy counting.

Thanks go to whichever parties stopped Chrysler from staying out of bankruptcy. This is much better. With Chapter 11 being declared by the automaker, they can more easily shut down dealerships in their far-too-vast network of lots full of cars nobody wants. They can clear out lawsuits and claims that hang over them. Fiat will now partner with them (20% goes to Fiat). The government gets 8%. Canada gets 2%. Ontario gets 2%. GMAC is now their financial arm (why this wasn't done ages ago when Cerberus bought controlling interest in GMAC, I'll never know... oh right, they couldn't possibly share like that). The unions have made some decent concessions, but there are still some swords hanging over their heads. Chrysler may actually survive.

Which means that GM should be soon to follow. This will be a case of waiting for the first person to leave the party so everyone else can follow. The banks should be right behind, but I have a feeling they'll stick around long after the hosts are asleep on the couch... as long as there are still pretzels in the bowl an a beer or two to mooch.

That's One Solution For GM...

So, GM plans to cut 21,000 jobs, close 13 plants, cut it's 6500 dealerships to half that, and kill the Pontiac line.

And then give the UAW 39% of the company, 10% to it's bondholders, and 50% to the government.

The bondholders aren't pleased and will likely kill the deal. I don't blame them.

Me? I'll miss the Pontiac line. It's been pretty much my main car for the last 10 years, in various forms. A shame they made it so boring.

Here's the thing, I don't think dumping the company on the union is a terrible move. I mean, they have more sway over decisions than anyone else, why not make them major partners? The government being the majority shareholder is a joke though. Would YOU buy government-made cars?

And there's 10% 1% (edit: stupid brain) missing.

Basically, the whole deal looks like a disaster in the making, where I'm sure the major banks will end up making a killing with their CDS holdings. Funny, isn't it, that the government would sacrifice the auto industry to save the banks.

Personally, I still think they should just let 'em fail. If bankruptcy protection doesn't work, then I'd expect some of those thousands of workers would get it in their head that they could buy up a factory or two and make better cars. There has to be some enterprising entrepreneurs out there dying to take a stab at making fuel efficient cars with lots of modern features that people actually want. They'd jump at the opportunity to buy up some fully functional factories and hire former union workers in a profit-sharing venture. But that would be... what's the phrase? Free market capitalism? Can't have that, can we?

For the Curious

CNN has a chart up showing how the over $10 TRILLION currently allocated to financial bailouts is distributed. Yah, gotta get all over the $142 million in AIG bonuses and the billions spent on the auto industry so far.

$10,200,000,000,000 = Money allocated
$142,000,000 = What required a senate hearing and days of media "outrage".

Why The Hard Line on Cars?

If you can count your money, you don't have a billion dollars.
- J. Paul Getty

The question that's being asked, that I'm sure the administration wish wasn't is, "Why is Wagoner out but Pandit still in?" Or why is Washington taking a hard line with the auto companies but still letting the banks run free?

Easy - they understand the car companies. They don't have fucking clue about the financial ones.

The problems with GM, Chrysler and Ford (funny how nobody talks about them now) are easy to see for an outsider, and relatively simple in comparison to the clusterfuck that is the US banking industry.

Too many dealers, too many brands, too much union power, too many shitty cars, horrible business plans that involve leverage and lending more than quality products. Also, if GM or Chrysler files for bankruptcy protection, the fallout is much smaller than if the banks do.

What DC wants to see is a plan where dealership are cut SIGNIFICANTLY, entire brands are shut down, union issues are resolved, and quality is improved.

I mean, they called out Chrysler on how uninspired and crappy their products are. I'll be driving a Dodge Avenger this weekend, and I'm laughing at how terrible it reviews as a car.

Also, the money invested in the car companies is barely an interest payment on what they've invested in the financial sector. So they can tell them to fuck off now and eat the costs if it comes to that.

But, like most of the actions that get the press these days - it's a distraction. It's Bart jumping up and down yelling "look at me! look at me!" while Lisa hides the diorama in the floorboards. There's trillions being sunk into an industry nobody understands and which holds a much bigger risk than the auto companies ever could, but those details are complicated, muddied, and possibly not entirely legal or ethical. The government makes these other big moves and broad strokes to keep people from looking at the real issues and assigning any real blame.

Or maybe I'm wrong, and this is actually a tester. Obama gets tough with autos first, and if it works, he turns his heat vision to the banks and tells them to get their shit together and asks their corrupt and clueless CEOS to kindly fuck off.

Probably not though... at least not until he shitcans Geithner.

Go Read This

Of all places, Rolling Stone has one of the best articles on the causes of the current economic situation, right here.

It's AIG-heavy, but that's because AIG works as a microcosm of the bigger mess. It clearly explains how AIG got into this mess, gives a decent high-level view of CDOs and CDS's, and even delves into the government's role (from 1999-present) in this whole clusterfuck.

I find it a bit light in the government section (because there's plenty of blame to be laid at the feet of Dodd and Frank and others, and one could even go back decades to find the roots), but the article is largely about how Wall Street has managed to gain control of the government... but not quite as consipiracy-nuttish as that sounds.

I do think it comes within inches of making a claim that should be cried aloud - nobody knows what the fuck is going on. All these bailouts (and they're bigger than the press lets you know), all these distractions ($700 billion TARP and AIG bonuses are nothing more than window-dressing), they're all attempts to obfuscate the fact that the US is broke and crossing its fingers that this all works out somehow.

This is Responsible Government?

The House passed one of their most asinine bills to date yesterday.

90% tax on bonuses paid by companies who have received over $5 billion in bailout money to employees with a household income greater than $250,000.

Think about that for a second. The US government just used tax law to punish capitalists. And they did just about everything wrong in it.

This affects around 12 companies, not just AIG. These are companies that aren't owned by the government, and that in some cases were forced to take the bailout money by Paulson and Bernanke months ago, under some retarded line about the money being to make sure "strong banks stay strong."

Also bear in mind that the bonuses in question (AIG) make up less than 1% of the bailout money promised to the company. This is very much the case for all the other companies affected by this tax. Yah, $146 million is a lot of money, but it shouldn't be the focus of all this rage. But it's easy to get the people riled up about, since all they hear is "bonus" and "fat cats" and "$146 million." The politicians go along because it blinds the people to the real issue - that the AIG is essentially laundering government bailout money to bail out other firms under the table. Yes, most of AIG's bailout cash is in fact filtering to Goldman Sachs and other banks who hold positions with AIG.

Besides, the same people passing this bill now were the ones who ALLOWED the bonuses in the first place.

And they were right to allow them.

These aren't performance bonuses, they're retention bonuses. What's the difference? AIG is shutting down all the arms that they should never have had in the first place. Investment in highly leveraged instruments, shell games, and the like. The problem is, these are complex businesses that only a small fraction of people actually understand. This isn't just "sell one million shares of IBM" here. These groups have managers, directors, and employees that understand how their accounts are set up, who their counterparties are, and what the hell they've been buying and selling. Not to mention how the systems used to do these transactions are used. Not everyone has the same trading program on their desk.

So, if they just send them out the door, then nobody knows how to shut down the business properly. Things will be missed, and it could end up costing hundreds of millions MORE in the long run. Instead, these employees were told they're going to be liquidated once their division is shut down, but that until then, they're needed. If you just got told you're getting shown the door in 6 months, and you have hundreds of thousands, if not millions, of dollars in the bank, are you going to stick around one more day? No, you're not. So the company offers them some extra cash to stick around and wind down their own business.

Are some of these people the same fuckups that got them into this mess? Absolutely. That doesn't change the fact that they have practical knowledge that nobody else does. They may be greedy. They may be clueless traders. But in the end, they know which buttons need to be pressed on their keyboard and the names and phone numbers of the people who will trade with them.

The fact that the tax is using household income as a base is a major issue. Some of these retained employees are NOT the millionaires. No doubt hundreds of secretaries, earning $30-50k/year are part of the deal. Anybody who works in a large office knows the secretaries have the real power and knowledge. So they get offered $10k extra to stick around for 3 months, which they think is a pretty good deal. Except their husband makes $250k a year as a doctor, completely unconnected from this financial mess. They just lost 90% of their bonus because their husband is a decent cardiologist. Is that fair? It suddenly seems a bit harder to damn the rich when the numbers change, doesn't it?

It also only affects bonuses. So the CEO who drove his company to bankruptcy is fine to make $1 mil in salary, but $1 mil in bonuses is taxed? Guess how the contracts get renegotiated.

And what about the employees at other companies that deserve the money? What about the ones at JP Morgan, which has done relatively well in this crisis, but has over that magical $5 bil mark in government money? Don't their employees, who dodged this bullet and made the company stronger than ever (relatively speaking) deserve something? At the very least, why should they be lumped in the same group as the AIG clowns?

No wonder so many of the recipients want to give the money back now. Some never wanted it in the first place.

This is a retroactive tax too. Some of these people have already left, having shut down their groups. They've spent some of the money, and now may be told they have to pay 90% of it to the government. Way to stimulate the economy.

And over all of this is the cloud of bad, BAD government. Out of fear of being called hypocrites, out of fear of their role in this being harped on, out of fear of the angry mob being fed by haphazard media reporting, and out of a need to deflect attention and look like they're doing SOMETHING tangible, the government (democrats and half the republicans) has decided to tax the hell out of a very narrow portion of the citizenry. Does this sound like a capitalist, democratic government?

What if they don't like how your pay is structured? What if they decide that small business owners paying themselves dividends instead of salaries is wrong? Or they decide that professional poker players are tax dodgers? What's stopping them from creating another heavy tax to discourage this? Hello precedent.

This is, once again, knee-jerk reactionism at its worst. AIG should have been allowed to declare Chapter 11 months ago, instead of being bought by the government. Then this situation would never have arisen. Instead, the government meddled, and has created such a mess that they keep getting more stuck in the tar pit they stepped into.

But hey, those in the financial industry are easy targets, despite the fact it comes dangerously close to abuse of powers, has constitutional concerns (depending on interpretation), and could be a precedent for a whole bunch of ugly. Maybe the Senate will have enough sense to rejig the bill into something that makes sense... or kill it entirely. Of course, that's not politically wise, and everyone knows that getting elected next cycle is more important than actually being useful.

Two Things

First, there's a small community bank, East Bridgewater Savings, that has pretty much completely avoided this credit crisis. How? They didn't lend to people who would never realistically be able to pay them back. They did their due diligence, and have had no foreclosures or delinquencies. The even made a small profit. And the FDIC lowered their rating and warned them to lend more.

Once again showing how completely and totally fucked up the economic situation is. A responsible financial institution that did WHAT IT IS SUPPOSED TO DO, and avoided this mess, gets bitched at by the government organization who's job it is to make sure banks are solvent, because it's being TOO responsible.

ANYBODY who thinks the economy is going to right itself because of what with the clowns in charge making these decisions are doing is delusional.

Second - Credit card defaults are up again. No surprise there. What kills me though, is the small business owners who are shutting down because their card company is raising its rates.

Rule #1 for any responsible financial planning? DON'T FUND SHIT WITH YOUR CREDIT CARD! There are very few lines of credit that have worse rates than these pieces of plastic. In fact, I can only think of two - loan sharks, and payday loan shops... which are essentially the same thing. For fuck's sake people, if you're running a business (hell, if you're just buying things), GET A LOAN to cover expenses in lean times. Paying 19-29% interest on your card to buy stock for your store is about the dumbest expense I can imagine a business incurring. If you are actually running a profitable, well-managed, successful business, and have a solid plan in place, then banks WILL lend to you. They aren't lending to giant credit risks, but if your business is really a business and not a hobby you sink your life savings into, or some sort of credit scheme disguised as a viable enterprise, then you can borrow for far, FAR less than what MasterCard is charging you.

How am I supposed to feel sorry for the world when it keeps punching itself in the face?

Cynical Happiness

The NY Times has a piece up about the end of conspicuous consumption, or some crap like that.

I think the topic is fine, but the people in the article really grind my gears. I'll spare the quotes, but it's full of people who obviously think very highly of themselves because they asked their husbands not to buy the jewelery for Christmas last year, or are wearing the same dress twice, or don't rush out to every sale at Saks, or don't really want that new power tie. In other words, the people you want to punch in the face for how smug they're being about their new found "frugality".

Somewhere in there is the buried message that people are finding happiness in new things - like the love of their families, or relaxing, or just reading a good book on the patio. You know, shit that most people who can see past their nose and give two shits about anyone but themselves already enjoy.

So, being the cynic I am, I immediately thought - there's your next mini-boom. I expect once the economy has stabilized (it won't get back to its old heights), most of these douchebags will go back to their old lives. But in the meantime, they're going to need help finding true happiness. I expect a rise in spiritualism. Not necessarily religion (although there will be that), but meditation, incense, candles, and new-agey gurus preaching love of family and seeking the simple pleasures. There's nothing inherently wrong with this, except that I imagine the majority of those taking advantage of the situation will be carnival hucksters selling snake-oil as sandalwood. I also expect to see the big corporations discover this and push all kinds of feel-good products and ideas. Expect more commercials with soft voices and Yanniesque music in the background pushing an eco-friendly aromatherapy product that will stabilize your Qi and calm your chakras or something.

I also imagine "family coaches" will start appearing to help distant über-rich parents connect with their spoiled unruly children by suggesting things like family games night or going to the zoo, and of course, talking.

Where holes are seen, cons will fill them.

Fight Little Antibodies! Fight!

Gruaaaagh!

That kind sums up how I'm feeling today. Actually, since about midway through yesterday. Not sure what the hell is going on, but I'm fighting something.

Which sucks, because I've got plans tonight I am NOT going to miss. Right after that though, I may curl up into a ball and rock myself to sleep. I'm going to go with a high probability that I won't be in The Mookie tonight. Don't let that stop YOU from playing though. I know that a Mookie without me is like a Christmas without Santa, but you should still try and get out for it. In fact, if you do see me there, it's probably because I signed up early... so there might be free chips in there for some lucky kids who stay up late.

Oh, and for your daily bit of economic news - the economy is saved! Markets are up! Everything's super!

I must be sick.

Blockbuster Bankrupt?

Blockbuster video is looking into Bankruptcy protection.

The article cites NetFlix as the main reason, which makes me smile a bit. I don't actually like Blockbuster. Never really have. It's sanitary, overlarge, overadvertised, and just feels like the big company it is. Walk into an independent video store and you've probably got someone who has seen more movies you've never heard of than movies you've seen. They also tend to be a human "Amazon recommends" with just a couple questions about what you like. They have deals you won't find at BB - "rent any movie, get a documentary rental for free" just to push things THEY find interesting.

Sure, Blockbuster has decent sales on previewed movies, but even those have become paltry as they hold on to high prices for the "big" movies while dropping the dreck to the $6.99 shelf.

Plus, you have to get there. Walk, drive, whatever, it's still less convenient than movies showing up at your door.

Or better - right on your TV or computer or iPhone. Video on demand is probably a bigger killer of the brick and mortar rental business than NetFlix and its ilk. That's why they're pushing to have streaming media boxes and online viewing options. NetFlix might have a big warehouse or two, but they're still effectively a lean, fast-moving company that can change with their audience. Blockbuster is a slow-moving behemoth that has a bunch of people who don't "get it" at the top. Another dinosaur who will die because it didn't adapt fast enough or well enough.

Just look at their website, it's pathetic. There should be real-time tracking of availability at stores, online reservation capabilities, and other items that could draw people to their stores. Sure, they have a mail system, but the whole setup feels like a giant company just trying to catch up.

So, the big blue video store will likely restructure, come back swinging, and still get it wrong before succumbing and dying. To think, they almost bought Circuit City last May.

Could be interesting to see who goes first... Blockbuster, or Pier 1. Yah, they're in trouble too.

A Refreshing -11

I got in from my week in Key West last night right on time. By the time I got to the car, it was an hour after landing, and -11 degrees C. I laughed as I walked the lot, because I found the temperature refreshing and welcome. This after a week where if it was +16 and breezy on the patio, I stayed indoors to avoid the cold.

Anyway, back to the office today, watching the markets continue to tank. We aren't near the bottom yet. As little as a couple weeks ago, I saw a Dow of 7000 as reachable, but sitting around 6900 now, I realize I underestimated. The commercial real estate market hasn't had its major crisis yet, but I don't expect it will be long now.

Right, I had a vacation. My semi-sober ramblings are down there somewhere, and also on Twitter. It was a good trip. Generally delicious food, good drinks, fun people, great weather, good times. I'll get some pictures up once I sort through the 1400 or so I took.

Twitter - I like. The radio show I wake up to today called it the most useless creation of the Internet ever, but they just don't get it. It provides two things - instant availability via SMS, and a forum to put up that thought you just want to share with someone when you find yourself alone. It's not about me caring about what you have to say, it's about me needing to say something, regardless of who reads it.

Or maybe it's just to keep track of bowel movements... beats me.

Macbook - I was told I was addicted to it on the trip. I'd fire it up when I woke up, and again whenever we got back to the suite. I like to think I was just validating my purchase. Actually, I really do like the convenience of a light laptop that is still fully functional, and am glad I bought it.

Anyway, back and facing a full week. Watchmen opens, birthday party, ski outing (heading north of Barrie if any Tuckfards happen to see me on a hill...), and with any luck, I'll pick up some new art for my place while toasting a couple friends who get married on Friday before moving to Australia for a year. That reminds me (the art, not the marrying) that I still haven't picked my free print from Alan yet... I should get on that now that he's selling photos left right and centerfield.

Friday Flotsam

Nothing overly coherent to say today, so it's all in bits.

- First and foremost - BBT4 is coming! Brit game, new Monday Riverchasers $26 game, Skillz, Mookie, and maybe some Big Games? Kickoff is March 1st, when I'll be in the middle of heading back home from the Keys. It ends May 31st... so much for Spring.

- Second and foremore - Eh-Vegas is just THREE WEEKS AWAY. Get your asses up here! Not that Kat, me, VinNay, and some Tuckfards can't have fun in the city by ourselves, but you'll cry yourself to sleep at night over missing it.

- Like the new Mac. Now that I'm getting used to the trackpad gestures and just accepting that my Applications folder is going to be a mess, it's becoming quite easy on the brain. Hey, as long as Full Tilt and Stars have clients for it, I'm happy. No, I'm not a Mac preacher, nor will I be. But Delicious Library is awesome.

- The desktop issue is slowly being revealed. After upgrading the Intel Matrix Storage Manager, it was able to verify that one of the disks in my RAID 1 setup was fracked. Sadly, it wasn't specific to what the problem was, but suggested reconnecting the drive so it could be rebuilt. Last time I disconnected a RAID drive, I accidentally disconnected my RAID 0 array, which resulted in a complete computer overhaul. This time though, it's all backed up. Let's see what happens tonight when I start it up.

- I'm off to do some advance scouting on Al's new home in two days. Well, not his actual residence specifically, but the bars, boats, and restaurants around it. Also, I won't really be reporting to Al necessarily, unless drunken text-a-shots saying "How hot is this bartender??" count. The downside? Al won't be there. Stupid timing.

- Dow is under 7300, S%P 500 is under 760... good times. Still not near the bottom.

- Some black dude who claims he's the President of the United States was in my country yesterday. People were crying, hugging strangers, cheering, and generally being orgasmic over Obama's 7 hour visit. People are pathetic. Still, a warmer reception than Bushy got. But one of the best lines of W's career was uttered here - "I'd like to thank everyone who waved to me... with all five fingers." I wish we had a likeable leader. Or even one with a personality.

- So much stuff to do before leaving. Place needs to be cleaned, batteries charged, groceries bought. My brother (not the one in Whistler) is house/catsitting while I'm away, which means the place has to be liveable for company. Yes, my place will be in better shape for someone ELSE to live there. At least I got my laundry done yesterday.

- Dell is willing to arrange a pickup for the laptop sleeve they sent me. Dell also called me to talk about setting up a high speed Internet connection with Bell since I bought a new computer (I'm already WITH Bell and I cancelled the computer... bravo Dell, proving once again your integration of departments is top notch).

- Donkament tonight? Maybe. Lots of stuff to get done first though.

- Logitech VX Nano? Looks like the route I'll be going for a mouse. Stupid RF.