Markets continue to stagger upwards on low volume. Political and economic news continues to be sparse. The things that I look at continue to tell me we're entering a recession - gas prices are high, UPS shipments are down, Walmart sales are down, all the businessmen I know are struggling. But Fortune 500 profits continue upwards as companies continue to get better at dealing with the New Economic Reality.
Two billion bullets isn't enough to make DHS feel safe, apparently. Now DHS is buying 2717 MRAP (Mine Resistant Armor Protected) armored vehicles for service on the streets of the US, with 5" thick windows bullet proof up to 50 caliper, gun ports, and run flat tires. This is getting seriously scary. You Tube video. What are they for? "[The vehicle] is used in the execution of high- risk warrants, including drug trafficking, smuggling, and contraband." said DHS spokesman Ross Feinstein. 2717 bullet proof unstoppable vehicles to serve warrants? They could drive one of these things through your living room, into your bedroom, drop a warrant onto your (previously) sleeping chest, then drive out through your kitchen while you were shooting pretty much anything you can imagine at it.
Unemployment numbers came out, the administration is making a big deal about how unemployment is down to 7.6%. The labor force participation rate ticked down slightly to 63.5 percent from 63.6 percent. People reported not in the labor force rose to 89.3 million in February from 89.0 million in January. I have a couple problems with this: first, the workforce as a percent of adults continues to decline, and second our favorite unemployment graph shows we're on the same perfectly predictable curve that we've been on for a couple years, so government actions are making absolutely no difference compared to the baseline rate of recovery. This is like Obama standing on the beach at high tide, waving his arms and chanting liberal slogans and claiming credit for the tide going out. "Double, double Food stamp trouble, Races burn and Classes bubble!"
The EU commissioned a large wealth survey a few years ago, and the results are coming out. They're very inconvenient. Italy has a huge debt which many think unmanageable while Germany has a much smaller debt; however Italians have twice the personal wealth of Germans, and Italian personal wealth has been growing faster than German personal wealth. Such a result, if widely published, would lead Germans to ask why their taxes must go up to bail out people wealthier than them. Well, I heard about it, it seems all too likely that Europeans will too soon enough.
China recently passed a new set of taxes designed to cool off their property market, which tax heavily on second homes - 20%. The result: a record number of divorces last month in China as this avoids the tax on a second home.
Monday will mark the start of S.Korea and the US holding war games, as they always do this time of year. It also marks N.Korea threatening all out war if the games go on. In recent years N.Korea has sunken a couple of S.Korean naval ships and shelled a S.Korean island killing several civilians. N.Korea says if the games go on this year the armistice is over the two countries will be at war. A North Korea unnamed foreign ministry spokesman said they would be entitled to take military action as of March 11 when U.S.-South Korea military drills move into a full-scale phase as it had declared the truce invalid. "Since the United States is about to ignite a nuclear war, we will be exercising our right to preemptive nuclear attack against the headquarters of the aggressor in order to protect our supreme interest." Some form of trouble seems inevitable.
Venezuela's president Chavez died after a two year battle with cancer. The new president immediately accused the US of a conspiracy and expelled one of our diplomats.
For years the US was the world's largest importer of oil. That's about to change - our oil imports have cut in half in the last six years; meanwhile China's oil imports are climbing. It's very difficult for me to see how China's 9% growth rate can be sustained in the face of $100 / barrel oil imports.
Argentina has announced price controls on basic foods. Historically this has always resulted in food imports drying up and store shelves emptying out. Argentina's currency is pegged to the dollar, but the unofficial currency market is now pricing dollars at a 54% premium. Argentina won't last much longer before they default, again.
Death Spiral: Maine, New York, Ohio, Kentucky, Illinois, South Carolina, Alabama, Mississippi, New Mexico, California and Hawaii now have more residents on some form of welfare than they have employed taxpayers. Or to put it another way, these states have more people voting for a living than working for a living.
Engineering news: British researchers have announced a portable concrete tent kit. You place it where you want a building, hook up a leaf blower to inflate it, spray water all over it, and the next day you have a 400 - 600 sq. ft. permanent concrete building. Have a look. Dig a 5' deep hole, build one of these in it, then cover it with dirt and grass and you have a great end-of-the-world shelter.
Culture: After a couple years reading non-fiction, I started reading some new science fiction to take a break. It's been interesting. It's curious how the literature follows the mood of our culture - in the 60's and '70's sci-fi was all about a future of limitless exploration of the galaxy, meeting and interacting with other intelligent life, a follow on to the excitement of the Apollo missions. Think Star Trek. In the 90's there was a sense of a developing internet and artificial intelligence that would change everything, with the line between human and machine intelligence blurring in the future. Think Blade Runner. Today there's an apocalyptic undercurrent - we all know deep in our bones that water, oil, arable land are running out and there will be big changes coming to the world, unwelcome changes that will cost us lives, freedom, prosperity. A lot of what I've been reading is a mix of 1984, updated to reflect an intrusive electronic world that Orwell could never have imagined, and the Matrix, where what you think you know and what's really going on perhaps have little to do with each other. People have a sense that change is incremental: tomorrow will be almost exactly like today, next year phones and computers will be a bit thinner and faster, but most everything else will be the same. But we all have a sense that perhaps one day we'll wake up to a new reality where freedom is limited and food and energy are rationed. A fall into some sort of high-tech dark ages. What does it mean? I think no one can successfully forecast such a fall in civilization, but the idea that world growth in population and wealth can continue unchecked is simply wrong. The world simply cannot support twelve billion people, nor three billion more people who have raised their standard of living to European / American levels of consumption. Books I've recently enjoyed: Lucifer's Pocket and The Phoenix Project. Movies I've recently enjoyed: Runaway Slave and Atlas Shrugged part II. Runaway Slave is a movie by and about blacks who wonder how it is that it's nearly impossible for a black to be a conservative or a republican, and who say that President Johnson's Great Society has broken up the black family seemingly irreparably, all but destroyed black culture, and made blacks slaves to a liberal government and its welfare largess. All are available at Amazon.