Markets traded sideways for the week as they gathered themselves up for the next move. Which direction? Bernanke is flooding the markets with money, Japan and China are doing their share of throwing money around too; it would seem up is the way to bet. Me, I'm not so sure, I think I'll sit on the sidelines and see how it plays out.
Reuters reports that the Greece report is being delayed until after the election, as Obama doesn't want "any surprises." I'm not happy about Europe sucking up to Obama, and I think we all have to wonder what "surprises" are in the Greek report. Sooner or later Europe is going to think that they have enough systems in place to save their own banks and they're sick of throwing money at Greek government workers and retirees. The more the EU denies that Greece will ever leave the Euro, the more I think it's inevitable.
Not to be outdone by the money printers in the US and China, Japan's central bank has announced that they will be printing up $100 billion too. Of course they talk in yen; a yen is roughly a penny. The Japanese national debt just hit a quadrillion yen. If you don't know what a quadrillion is, that's ok: soon enough when inflation really hits the US you might learn. It's a math term that previous to this decade never came up in polite conversation.
Another reason to buy gold: gold and platinum nano particles inhibit cell division and are therefore used as treatments for some cancers, especially aggressive prostate cancer.
In a new poll published by Die Welt, 65% of all Germans said they would be better off without the Euro. In a similar poll 36% of French agreed. 49% of Germans said they thought Germany would be better off if they left the EU. The ECB has set up conditions with their interest rate cap program where Spain and Italy must ask for a bailout, then agree to heavy handed austerity terms set by the European Financial Stability Fund and the IMF - completely undemocratic organizations imposing wildly unpopular budget constraints on a populace completely fed up with austerity. We have entered a curious new stage in the Euro crisis where it's economics v. democracy.
Tension over water is increasing on the Pakistan / India border, as both countries are desperate for more water for their growing populations, neither has enough water for the populations they have now, and a substantial fraction of their water is shared between the two adversaries. There are five rivers flowing through the Sikh-dominated Punjab region that covers most of the India - Pakistan border; in fact the word Punjab means Five Rivers. The five rivers start in India, but eventually flow into Pakistan's polluted Indus river - which also gets its start in Indian glaciers. The word Indus and the word Hindu are basically the same word; history runs very deep in this region. India and China are set up for a similar dispute over the Brahmaputra river. To various extents, India, Pakistan and China are all substantially desert countries with severe ongoing and increasing water shortages. Remember, in an industrial economy as much as half of your water goes to power generation, so water has a stranglehold on agriculture, energy, and population. It will be surprising if we don't see wars over water in the next ten years.
Conflict is heating up in the ocean waters surrounding China. Asia is desperate for oil, and it's thought that these coastal waters might contain a lot of oil. Uninhabitable islands are suddenly looking very important as they change a nations boundaries. Japan and China are making noise like they're near war over the Spratly islands; China is also arguing with Taiwan, Vietnam, the Philippines, Malaysia, Indonesia and Korea over similar issues. Remember, the US emergence as a world economic power happened during a time of abundant water and cheap oil: for China the environment is very different.
As the US, Britain, France, Germany and several other countries send naval assets to the Persian Gulf, we're nearing a point where you can walk ship to ship from Saudi Arabia to Iran. The US has three aircraft carriers in the little puddle right now with a fourth steaming to get there. Each carrier holds aircraft with more air power than Iran's air force. Everyone is preparing for an Israeli "sneak attack" on Iran, and an Iranian reaction which includes trying to close up the Straights of Hormuz and bombing various US and Arabian military targets in the region. The commander of Iran's revolutionary guard, Jafari, said Friday "A war will occur, but it's not clear where or when it will be. Israel seeks war with us, but it's not clear when the war will occur." Jafari also indicated Iran was ready to help in the defense of other countries, a thinly veiled reference to their 18,000 troops in Iraq, more in Syria and possibly in Lebanon. If attacked, Iran means to put the entire region at war. Another Revolutionary Guard commander indicated that Iran is considering a pre-emptive strike against Israel. Will Israel attack before or after the election? Obama has refused to meet with Israeli prime minister Netanyahu, but has met with pretty much all the Arabs. Israel has been given no public indications of US support or guarantees. If I were Netanyahu part of my calculus would be if I could use the attack to help get Obama out of office, as he has proven no friend of Israel.
I've noted in this blog that the election hinges on a few swing states: Ohio, Florida, Virginia, Colorado, Iowa, Nevada, Wisconsin, and New Hampshire, which collectively account for 95 electoral college votes of the 270 required to win. It turns out each of these states has a key country that went to Bush in 2004 then Obama in 2008. Want your vote to count? Move to one of these counties where you have an opportunity to swing a key state:
The Congressional Budget Office just released their predictions for Obamacare. By their estimates, in 2016 there will still be 30m uninsured:
I recently bought a Google Nexus 7 tablet, $200-$250 depending on configuration. It's an interesting toy. It's got a very beautiful color touch screen that's nice for watching little movies. If you're writing something small, like a post on Facebook or a forum, instead of typing you touch a little microphone and it does speech recognition, which is pretty decent. You have to be a little technically astute if you want to load your own books and movies onto it, it doesn't exactly have a file system that Windows recognizes, and you have to find appropriate apps to read books. Google for some mind-bogglingly mysterious reason has disabled Google Voice on the Nexus which means you can't make a phone call, but you can load a 3rd party app, Talkatone (I haven't done this yet) then you can make and receive phone calls for free. You can send and receive emails and texts with the tablet as standard. It's pretty kewl, you say out loud "Where are you? Get your butt home!" and the Nexus types the text for you, then you text it to your kid's phone. It's ok for watching movies in bed, but you have to hold still or the touch screen screws you up. It's not a very good choice for reading in bed - it's almost twice the weight of my Kindle, and there's no easy way to hold it without touching the screen, which makes something happen. The Kindle is far superior for reading simple fiction, but the Kindle really falls down if you're reading something with pictures, like a text book, or if you're trying to read a PDF. The Nexus 7 is simply superior for those types of books. It's a nice device to have near your TV - you can watch NFL.com and chat on your favorite forum while watching the game on the big screen.