Nom de plume: Rivrdog

Sic Semper Ignorati

Will someone check my Latin? Ignorati may not be a real Latin word, but since you know what it means, I'll use it anyway. You ignorati who think that because some fool stops playing beer pong long enough to slam some code ought to be supported in his bid to take over the world's information system just got your comeuppance. The stock lost 11% today and would have lost more had it not been propped up, for the second trading day, by Morgan Stanley, which seems to have a penchant for throwing their client's money away (and you KNOW what that means if they trade for you). Were it not for the support of Morgan Stanley, Facebook would likely have been down at least to $30 and maybe it would have collapsed by now.

At this point, the big investment funds that went out on a limb with FB are looking to cut their losses. It will be a bad week. Normally, when the stock of a IPO hits it's floor, it has nowhere to go but up, but this observer says FB will not go up, because they have nothing to offer for the future. No business model, no long-term loyalty base, no nothing but controversy now. Both Zuckerberg and his minority partner are playing tax-avoidance games which are also responsibility-avoidance moves. The fall of Facebook stock might be slowed by day-traders playing it's options, but those options can't give the stock value, they can only delay the inevitable. Investors bypassed the faults of the company and bought the shares because they believed that they were on an up-elevator. Now that they know that their ride has small ups and big downs, they will get off that ride quickly.

NASDAQ will shelter the stock by the end of the week. Facebook users will use the product, from which Zuckerberg recovers about 20 cents on the recoverable dollar, just until something glitzier comes along, or until some sort of major privacy breach occurs, and I rate that as a strong possibility; given the slapdash way the company is managed for finance, it's probably managed for security the same way.

I don't have a Facebook account, simply because I can get what I want more securely elsewhere. When the current crop of Facebook users come to share my attitude, and they will, Facebook's market penetration will begin a slide from which they will not recover.

Remember MySpace? I didn't jump on that bandwagon, either. I have Twitter accounts, but don't use them personally in my circle, which pretty much relies on email, telephone or personal contact. I occasionally send text messages. I'm connected well enough, and share what I want via my blogs.

As the kids grow up, they will shed Facebook, too.

Now, given those conditions, who the HELL wants to invest in such an enterprise? 

Put on those green eyeshades...

Yep, it's time to visualize the US economy, if you can. Yes, it's a hard job, what with both the Government and the Banks try to out-do each other in generating smoke to puff up our hoo-hoos and to hide the facts indicating that we are in big trouble.

This article explains the dire state of the economy as well as any I've read lately, though, so go there, then come back here for the discussion.

Fresh coffee (might better have some "fortifier" in it though) is now in order, and keep the Tums handy.

Note in the article, that withdrawals of money from circulation (re-financing to lower interest rates) have certain effects, one of them being that there is a multiplier involved. This article puts that multiplier at 10, but doesn't give support for that figure, so it might be less. I remember from ECON 203 (Money and Banking Theory) way back in the early 1960s when this level of deficit spending horrified everyone with a finance education, that such multiples existed because of the interdependence of all the houses of finance. It works like this:

Financial House A makes a loan to a consumer, and then sells that paper to Financial House B. The Government backs, or guarantees the performance of the loan (didn't back when I learned this stuff, but does now). So, B owns the paper, but for various reasons which are over my head, A is allowed to show that loan on their books for a while past the point that it sold (possibly because of the legal liability involved with originating the loan). That's a multiplier. Any money on the books for either A or B is creditworthy for those financial houses to borrow against, so that's also a multiplier. The money the houses borrow then has multipliers, etc, etc. House of cards, but hey, I didn't invent this system, so don't shoot me. Suffice it to say that the entire financial world operates on the basis of this shadow money as if every penny of it existed and could be produced on demand.

The article talks about "reserves". Substitute the words "Actual Cash" for reserves. In Europe recently, reserves had been allowed to fall to below 2 percent of available credit. That's right, the banks were able to play their games on TWO PERCENT MARGIN. Bear some history in mind. The Crash of 1929 was caused, in large part, by people playing the US equities market on TEN PERCENT margin. Well, Europe is considering raising the margin requirement a percent or two, but that raise is getting bad reviews from Socialist France, which wants to print it's way out of it's current financial malaise. In the mose austere of circumstances, it is unlikely that Europe will agree to reserves of over 5%.

Then, there is the well-known factor of panic. In fact, stock market crashes used to be called "panics" in the history books. We saw a modest panic in 2008, but despite that the equity losses barely got down to 50%, it took 4 years for the market to regain those losses (the Real Estate market has yet to regain ANY losses of equity).

So, what does this mean for us, Campers?

What it means is that the entire civilized world has no financial confidence left, no confidence that the system will heal itself as it has done before. That sets the stage for another panic, and since the actual money level behind Government and Bank debt has gotten smaller, the next crash WILL be much more severe. It is likely that entire governments, and most, if not all Banks will be bankrupted in the next crash (actually, most current Governments meet the fiduciary definition of bankrupt NOW). Every government bankruptcy creates a multiplied panic, and if enough of them occur together, the world's economy goes over a cliff.

Yee-haw, free falling economies! Can it happen here? It did before, most notably in 1929, and as previously stated, the reserves were much bigger then.

The real question for YOU, Campers, is, Can you farm? Can you be responsible for your own food, shelter, health and safety?

If any part of that answer is NO, your future is as bleak as your Government's.

You know what you need to do. Get busy.

Mucked-Up Monday

I arise today at a reasonable hour, and decide to reconcile my checking account, which I haven't done in 12 days. At the 'puter, I click open the Credit Union web page, and note that it has been completely re-designed. Hmmmm...the hairs on the back of my neck start to tingle (I am the RivrDOG, after all!).

I find the log-in tab, and click it. It opens very slowly, and so I insert my account number and click on "Password", which fails to take the password I type. Hmmmm. I change from Chrome to Internet Exploder and try again. No joy.

I go back to Chrome and re-enter everything, but now use the "tab" key to get to the password box, and now it takes my password, but when I click "go", it doesn't go, and I get a FUBAR box from Chrome. Back to Exploder, do the same, get the same result. Go back, do it all over again, this time using the keyboard Enter key to enter instead of mouse-clicking on "go". Still FUBAR.

I started to try to access this account (into which ALL my pension deposits are electronically made, and out of which I pay all bills) @ 0745 local, and it is now 0905, and the CU is actually open, but still no fix. I have been on "hold" on the phone for over and hour, and have no answer, just hold ads. I read blogs for an hour to pass the time while on hold.

It's payday, too, and if this keeps up, I will have been denied almost $7K in incoming funds.

This about rips it with me for this CU. I have done business with them for almost 40 years, but they cheap out on everything. In this case, their mistake is obvious: they changed everything to have the newest and latest web-page, but failed to post their IT guy to 24-hour monitoring of it to make sure all the new server links stayed up and working.

This is also the age of robo-calling, and the farging CU COULD have had a robo-call sent out to all the members to advise them of the outage, but they didn't do THAT, either.

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The issue got resolved about 0915, 1.5 hours after I discovered it. I had to redial the CU, the hold music went nowhere, and after the staff took their desks for the business day, no one picked up that line. GRRRRRR! After redialing, I get a staff member, and she discovers that in the last five minutes, the system had just come back up.

Tomorrow is the Annual Meeting, so I might just have to drop by the CU and pose a question from the floor to the CEO of why the CU either does not have a 24-7 IT guy, or subscribe to a monitoring service, or have ANY way to report an online banking outage when the office is closed. Saving the members' money is one thing, but when they are so cheap as to make online banking useless with their inattention because they won't pay for some system to monitor and report to the IT manager, then they're saving TOO many shekels.

 

Jobs, the REAL question

In honor of Joe Huffman, who taught me to ask the One Big Question...Joe's a bit busy this weekend, so I'll iterate what he would say if someone asked him the One Big Question which has formed in my mind.

Simple question, that.

It seems that we are about to decide the policy direction of our Nation based on one little word, "Jobs", but has ANYONE stopped to ask what a "Job" actually is, how it is properly defined, how the statistics about "Jobs" are actually derived, and whether ANYONE ever checks those statistics for accuracy?

I might not be an economist, but I have dealt, to some degree, with the idea of budgeting. In budgeting, we have a concept called "Full Time Equivalent". At any sizable organization, public or private, that employs people, there is a standard definition of what it costs to have one person perform work, and that is the FTE.

Basically, the FTE is what one "standard" person draws as a wage, together with the value of that person's economic benefits (vacation days, health insurance, etc), over a period of 2,080 hours (one standard working year of 52 forty-hour weeks). My FTE, just before I retired from copping, was just over $90,0000. That was a wage of $28.56/hr, plus annual benefits running to just over $30K.

So, for full-time employees, the costs are fairly easy to break down. The tricky part is how to measure less-than-full-time work.

That's NOT tricky if fractions or decimals of an FTE are used. The average US wage (Median wage, to be accurate) last year was $26,364. Just search on "average US wage", and you will get all sorts of sites which display the statistic, and tell you how it was derived.

Why then, does the Government "play" with the figure so loosely? Here's an example of "playing". With "Job Creation" now the measure of whether a candidate "has it in him" to be President, why haven't we demanded, and gotten, a precise definition of what One Created Job actually is?

Here's what "One Created Job" ought to be: One FTE, measured against the last, accurate US Median Wage, projected as if that job lasted one year. A couple of years ago, when the "stimulus" was the big topic of discussion inside the Beltway, and "shovel-ready jobs" were being "created", I remember reading that the Obama Administration was claiming One Created Job for every job opening that lasted 15 days or more. Of course, that's crap. No two-week job ought to ever be compared to a full-time position.

Since we all have calculators, let's do the math. Taking $26,000 as the annual wage in question, and adding in, say, $10K in benefits, we have an FTE for those "shovel-ready" jobs of $36,000, or $3K/month. If those jobs only last, say, 3 months each, then each one is 0.25 FTE, and the base earning is only $9K for each job. Did YOU ever see those jobs listed that way? I didn't. That same Obama Administration (and, likely the Bush II Administration before it) claimed Christmas Seasonal workers as "created jobs" every Fall, despite the fact that those jobs never last past the middle of January, and are less than .25 FTE each. Same thing with Summer Seasonals, etc

The Government (and candidates to run it) lies, and our entire National future is being decided by this particular brand of lie.

Let's ALL go activist on the political process here, and demand that ANYONE who uses Job Creation in any sort of political statement be REQUIRED to prove out how many actual FTEs he/she is referring to, and what the actual dollar figure of that FTE actually is.

Can we do that, people? I think we can, and I expect THAT sharp saber, if universally used, would deflate a LOT of political hot-air balloons, if not ALL of them.

You have your assignments. Attend political rallies, and at the right moment, shout the One Big Question at the candidate(s): "Sir, what is YOUR definition of a Job"? I guarantee that the pretenders will NOT be ready to answer you, so YOU be ready to repeat your question.

Why we fail

Ever since the "Great Recession" started, my State of Oregon has been two full percentage points behind the national unemployment statistics, which are probably pencil-whipped, add at least 5 percentage points to all such stats you see. Oregonians are in that hole for a variety of reasons, high taxes are probably the one thing keeping most business depressed, but excessive State regulation stacked onto excessive National regulation probably has something to do with it also.

Oregon sucks for business, unless, of course, you are a Hollywood liberal who wants to make a film here, and then the State bends over backward, putting State employees to work in your producer's office to "smooth the way" (BTW, those folks all work for the Governor directly). "Green" also gets huge tax breaks, but if you just want to set up a stamping mill to stamp out a particular piece for say, the auto industry, fuggeddabboudditt.

All of this gives bad impressions to all those Daddy Warbucks types out there, and, like it or not, they have the moolah to actually put business in this state.

What to do.

Well, if you are a liberal like the Governor, you sign up for a class to help you understand the poor business climate.

You go to Portland State U, my alma mater, and there you will find the "Institute for Sustainable Solutions". No, I'm not kidding, they actually TEACH that crap. When I matriculated in 1966, PSU gave a good basic education, more night than day classes to students, many of them Veterans, who wanted to get ahead in life. There were few of these "puff" classes, and certainly no entire Institutes devoted to teaching this sort of puffery. But I digress....

At that prestigious (in Portland, anyway) Institute, they are wondering if those somber measurements of GDP (Gross Domestic Product, the total worth of all good and services sold/consumed in the US) is actually the best way to measure the value of an economy.

Dollars are SOOOOOOO old-fashioned as a measurement, so Twentieth Century, says the Institute.

Let's measure FEEEEEELINGS instead, says the Institute. So, the Institute proposes measuring the GPI ("Genuine Progress Indicator") instead. What is a GPI composed of? 26 things, according to the fishwrap's article on same, but let's examine the name for now.

"Genuine". The word is supposed to mean truthful, real, authentic. What about this measurement gives itself the right to be "genuine"? The article doesn't say. One surmises that they just needed a "G" word to put in front of "Progress" to hide it's association with all things lefty.

"Progress" This one's easy-peasy. PROGRESSive. Get it?

So we have the "Real because we say so, list of progressive things we think indicates satisfaction with life". Yeah, that's a mouthful, but that's what the Institute is trying to cram down our throats as being just as important a measurement as the basic, definable, dollars and cents of the GDP. This GPI is your basic moving target, people. Since there are REAL bean-counters out there who CAN and DO point out when the Feddle Gummint messes with the GDP stats, there is a source of counter-point if those stats get pencil-whipped. This new Indicator has twenty-six indices of what? It comes up with what? The "World Happiness Report" (issued by the Earth Institute, no less). Who gives a flying fark? The followers of Mother Gaia and the cult of Holy Sustainability are those who give a fark. Not we filk who work for a living, or are living off the fruits of working for a living for 46 years like your blogger.

Scary, isn't it?

This is why we fail. This is a "Genuine" guarantee of failure. This is nothing but a way for the Left to claim we all smell like roses when we just stepped into a bucket of crap.

There is truly no hope. There is especially no hope when the Guv'ner sits in this class, lapping up this poison like a kitten lapping up warm milk.

You have the Guidon, Mr. Romney

...and, in case you don't know it, the Guidon Bearer is supposed to stay out in front of the formation. You are now leading the Republican Party race for President, so let's look at the battle streamers on that Guidon, and how they may differ from your past performance.

Second Amendment: You were a big gun controller in your stint as Governor in MA. There is a battle streamer on your Guidon that says the Second Amendment MEANS WHAT IT SAYS, so you NEED to tell us that you will NEVER sign any kind of gun control legislation restricting the right of US citizens to keep AND bear arms. You did that in Taxachusetts. Your apologists say you yielded to avoid even more drastic gun control, but a Guidon Bearer never yields, never falls back, always stays in front. Tell us you WILL be a Second Amendment absolutist. Tell us you will have your DOJ go after all the Gunwalker people (if Obama doesn't pardon them all on his last day in office). Tell us that you will have your people bear down on the DeeCee Administration to move them off their position of resistance to Heller implementation. Tell us that you will put the DOJ into an aggressive posture to hammer places like NYC, Chicago, etc to get them to recognize that they can't disarm their citizens. You could start by cutting off Law Enforcement funding to any jurisdiction which does not meet a basic test of complying with the Second Amendment. Your predecessors did that for civil rights violations in the past, so just look at 2A compliance as a Civil Rights process.

ObamaCare: You started this ball rolling with your "RomneyCare" in MA. It will be your job, if elected, to erase ObamaCare, and that will take some work, because like an invasive weed, it has spread it's roots everywhere: into the tax system, into continuing funding laws, into the Pharma industry, into the very Emergency Rooms at all local hospitals. It's complete re-write of the way medicine is provided has and will screw up delivery of medical services for decades, even if you rip it all out, and do it quickly. Don't even think about leaving it partially in place, rip it ALL out and THEN make any necessary reforms, starting with draconian tort reform for malpractice, and a total cut-off of free ER care for illegals. You DO realize, don't you Mr. Romney, that the reason most states can't balance their budgets is that the cost of providing medical care to illegals has overwhelmed state budgets? In my State of Oregon, it is estimated that almost a third of education funding goes to illegals and over a third of Medicaid.

Immigration: See above paragraph, AND, Close the farging borders! Keep out all further illegals, use the military for that, THEN get to work on deporting the ones who are here. If you want to accelerate the right of naturalization for some, do that, but make sure that those individuals who are illegal now start their naturalization process by returning to their native country, waiting a determined period, then applying for a visa to return, and then they return via normal entry, just like I do whenever I leave the country and come back. Make sure all naturalization candidates declare their previous illegal stay in this country, and pay up all their back taxes they avoided by working under the table. They need to pay for any medical care they walked out of paying, too. This stuff CAN be tracked, so track it and start collecting those back taxes. If every illegal owes just $5K in back taxes, and there are 20 million of them here, that's 100 billion dollars, not exactly chump change and definitely NOT forgivable. Maybe some of them can work it off, but COLLECT what they owe, dammit!

Control the Economy: This may not sit well with most of my conservative buds, but there has to be some central control over the economy. This isn't "morning in America" like it was for Ronnie Reagan. The Global Economy had barely gotten started then, but now, we have robber barons controlling vital companies all over the globe. You can't just give them their head and let them run with our economy. They will continue to rob us blind and it will get even worse under your Administration. How about a basic principle of Everybody Pays Some Tax for starters? No business baron should be able to have his company pay no taxes. A small minimum tax will not cripple any business, and with all the regulatory burdens you are going to lift off these global businesses, they can afford to pay some taxes. Likewise, no individual gets off without taxes, either. Establish a minimum income tax of at least 5%. That will mean that the welfare-dependent might have to forgo a few cans of malt liquor per month, or keep that 42" flat-screen instead of upping their lifestyle to a 60", but DO IT.

Carry that Guidon, sir, and carry it proudly. If you do, the troops will follow you, and that's all you need to begin to turn this Nation around.

Do you pay quarterly taxes?

We do, here at Schloss Rivrdog. Last year, my quarterlies jumped from just over $1,000 per quarter to well over $1,400. That wasn't something I selected, when my CPA ran the worksheet, that's what came out for me to pay. I had no forecast increase in income, either. We live on a fixed income here.

I paid those increased taxes, and this year, I overpaid my Federal tax by over $1,100. Strange. Never did that before, I have always had to pay a small amount on Tax Day.

So, is anyone going to look into this and see if it was universal? If so, it amounts to a fraud scheme by the IRS, and one which pumped up the expected revenue, so more could be spent on vote-buying. Now that I have a significant refund coming, if most other quarterly payers are in the same boat, then the Federal government will run a large shortfall in revenue this year. There might also be issues of deficit reduction not meeting guidelines, or issues of having to print more money than expected.

Dono, but if  I'm not the only one who got rooked like this (to the tune of about 15% of my tax load), then there WILL be some revenue issues that will be hard to hide.

I might not be a power grid engineer...

...but I know a SERIOUS lack of engineering when I see it.

For once, the daily fishwrapper did itself proud, and provided a concise, useful look at the alternative-power mess in Oregon, my Oregon. RTWT, then come back, I'll be waiting.

Buh-bye, Chevy Volt- Updated

Bring this sucker back at HALF it's $46,500 MSRP, and include a kit to power your house with it in case of power outages, and I'll buy one. Meanwhile, GM halted production and laid off the plant.

Not gonna happen, though, so your Rivrdog gives the Volt, it's parent, Government Motors, and it's chief braggart, President Obama, a hearty, "Sic Semper, Mo-Fo".

That is all...

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Update: 030612 0832 PST: Sent by the Coyote Kid: Bill Balsamico, owner of the famouse Casa D'Ice restaurant, noted for it's tell-it-like -it-is signs, blogged (can't find his blog, though), so have to paste it up...

Balsamico notes that in recent history, there have been two notable car model failures, one from GM and one from Ford. At least though, Ford blew his own money on the Edsel, whereas GM has wasted OUR money on the Volt.

Good point, Bill!

$5/gallon gas by this summer, eh?

Another Thursday Thud!

The pundits and energy insiders are saying that we'll have $5/gallon gasoline by this summer. Of course, that's an enviro-whacko wet dream, they all think that it will get people out of their cars and onto crime-ridden busses and trains, or onto Holy Bicycles. It won't of course, any more than $5/pack cigarettes caused many smokers to quit.

$5/gallon gas WOULD cost Obama the election, that's a lock. When that price for fuel arrives, just watch how fast he drains the Strategic Petroleum reserve and jawbones the speculators (or has Gauleiter Holder toss them in the clink). Of course, he hasn't touched the SPR for any of the other price rises yet, but you can bet he will when his election's on the line...

And no, it won't drive any peeps into Government Motors showrooms to buy the now-$46,500 Chevy Volt, even though the Gummint just upped the ante on the tax rebate for it $2,500 to $10K. Chevy then raised the price $5,000, to show how much of a Team Player THEY aren't.

The Volt sucks, will barely get you to the grocery store and back on it's battery before it becomes just another under-powered gas-electric hybrid. Don't believe me, check the Internet for the data. Sold as a 40-mile battery-electric, the car, with careful driving, will get 25 miles before the engine has to run the generator to recharge the battery and power the car.

If any other car manufacturer lied about the car's mileage to the tune of 40%, you bet Holder's gestapo would put the boots to their front door and march off with their records, and frog-march an executive to the pokey. Not Gummint Motors though, the fix is in.

I considered buying a Volt once, when it was still in prototype testing, and there was a rumor going around that there would be an option available to power your house with the car in emergencies. If GM had had any smarts, they would have sold that option, and in selling the preppers the car, it would have smoothed over it's idiotic price point AND it's under-performance.