Who would have thought one random Thursday could generate so much news and information? I had a late start tonight (traffic was just dumb heavy) so I cannot spend the time really needed on all the latest developments. I will focus on some less reported areas and of course add a heavy dose of sarcasm. Get your Friday night requests in as well all!
While this is an economics blog primarily, it cannot exist in a vacuum. Today brought some sad news.
Sadly Farrah Fawcett died today after a long battle with cancer. I have seen such fights up close and I can only wish that she is in a better place now.
Late news that Michael Jackson died today at the age of 50. The cause of death is listed as cardiac arrest. Whatever you might think of Jackson, his work did touch so many.
Probably Not a Good Idea
Loyal reader Gawain's Ghost tipped me off to this article by Gary North which looks at the writing record of one of my all time favorites, Mike (Mish) Shedlock as it relates to the deflation/inflation debate.
At first I was confused as to why Mr. North decided that Mish's writings were a particular area of focus. I imagine it is because Mish has such a large and loyal following and Mr. North simply wanted to engage Mish in an open debate. After reading and re-reading the article unfortunately I think it may be more than that.
This is an example of what I am so glad does not happen here in the comments or with those that I exchange email correspondence with: confrontation with the aim to make the other's view either irrelevant or suspect.
Mr. North goes as far back as 2005 to target particular articles, or even just passages where Mish seems to have had a gap in logic or a conflicting idea. I can say with total confidence that in the two plus years of this blog I have been ALL OVER THE PLACE, so this is no surprise. I would also add that I have been reading Mish since his site started and his views certainly have evolved as the data has, but his core themes have not. I think Mr. North makes a huge jump in the wrong direction with what he surmises is Mish's end game ideas as well.
Look, Mish does not need little old me to defend him. His writings speak for themselves. I would even advise him not to answer this article because it is a game of "gotcha" we could all do without. To all the bloggers and any writers anywhere, lets keep it clean and impersonal unless Paul Krugman or Bill Gross are involved, then of course full steam ahead!
Winner of the "Most Terrifying" Headline of the Day Award
Today on June 25th 2009 the winner of the "Most Terrifying" headline award is clearly from Naked Capitalism:
Is Bernanke Toast? If He Is, Summers is a Shoo-In
This is like "The Exorcist" kind of scary. I may need a night cap just to sleep tonight. Maybe two.
Change I Could Believe In; No Seriously
Even though I am a inflation oriented future thinker, I actually hate inflation for all it's slow killer ills. Of course if you hate inflation, your superman is Paul Volcker. Not quite "the sausage king of Chicago" (movie very obscure reference, try to guess!) but more the ultimate champion of inflation destruction.
In these troubled times with so many moving parts, leave it to an over 80 year old former FED head to figure out how to fix everything is a few simple steps:
What is it that Volcker wants?
-Impose capital requirements on trading parties, people familiar with his thinking say.
-Make bigger banks smaller
-Reduce the role of an overstretched Fed
-Force Derivatives to be traded on exchanges
-Transparent investor prices of Derivatives;
-More-aggressive capital reserve requirement
-Bigger role for exchanges.
Yes folks, it really is that easy. So what's the problem?
Note to president Obama: Fire the dummies you have, put Volcker in charge, and I may even go door to door for you next election!
Every Little Thing is Gonna be Alright
Sometimes when I scan the headline page at Yahoo Finance I see things that just hit me as either funny or so sad I want to cry. Today was one of those days.
Here is a screen capture from the Yahoo Finance main page at 9:44 am on June 25th 2009:
The leading headline and summary show just how far we have come.
The headline reads:
Economy Dips at Slightly Lower 5.5 Percent Pace
Which is asinine in and of itself. The assumption here is that you have no idea the last reading of 5.7% is not really any different from the new 5.5% number.
Of course this is pretty standard now, and it was not the headline that hit me. It was the first sentence of the summary:
"The economy tumbled at a 5.5 percent pace in the first quarter, but appears to be doing better now."
And really there you have it. We have reached a point where baby talk is now standard fare in the financial media.
One of the millions with no job and benefits running out? No worries, everything is getting better now.
Credit card rate just got jacked up to pay banking employee bonuses after you got hit with paying for their losses? Forget about, its getting better now!
I could go on all night. This kind of wording from a media outlet is disgusting and it makes me sad for where we are right now.
Please note that the very last headline "FED 'Light years' from a rate hike" you would have already known by reading my blog!
Economic Disconnect Exclusive: Extended Bernanke Testimony Before Congress Today
FED head Ben Bernanke was in front of a congressional panel today to answer questions related to the Bank of America purchase of Merril Lynch. The point was to discern whether the FED and/or Treasury threatened Ken Lewis of BAC into staying the course on the deal no matter how bad Merril losses became.
Here is the unreleased final session from congress today, an exclusive satire from Economic Disconnect:
Dan Issa: Mr. Bernanke am I to believe that you basically "do not recall" any dialogue, written or spoken, related to the BAC/MRL merger?
Ben Bernanke: I'm sorry, I forgot the question already. What?
Dan Issa: You mean to tell me that one of the most earth moving episodes in the financial meltdown is lost from your memory?
Ben Bernanke: Sir, I think you are referring to that film "Total Recall" where the California governor lives two lives with different memories. Or something. I cannot remember.
Ron Paul: Mr. Bernanke, do you recall where your car is parked today?
Ben Bernanke: Why do you ask?
Ron Paul: I was just hoping that you would not get lost in this fine city of DC today after this meeting.
Ben Bernanke: Luckily I have a GPS so if I forget where the car is, it leads me right to it. Sometimes the car is in Argentina. Weird huh?
Ron Paul: Mr. Bernake, do you recall where your hairbrush is today?
Ben Bernanke: Trick question! You know I do not use a hair brush, I just pat what is left down in almost pure "Goldman Sachs" style, except I kept my sideburns. Hahaha, nice question, I'm out-of hair, bye bye!
END OF TRANSCRIPT
Have a good night.