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Financial Briefing: Slip Sliding Away

Wages are too high in the US, at least as a ratio of what we consume to what we produce. If we wish to regain our competitive edge, wages are going to have to drop. (I'd also abolish the minimum-wage if it were up to me. That's a guranteed way to stimulate hiring on the low-end, but of course Democrats will never allow it.) Pull quote:

I'm sure many of you are reading this and thinking that if anyone is forced to take a pay cut to rebalance the economy, surely it ought to be overpaid investment bankers, corporate executives and newspaper columnists. That's how things would work in a socialist paradise, but not in market economies, which are much better at producing efficiency than fairness.

And I think "fairness" is the wrong word to use anyway. Life is not (and never will be) "fair", at least in the sense that liberals understand it.

An "End the Fed" cabal beginning to form? If so, let me know: I'd love to join. I'm a fan of secret societies. Mysterious rituals, bloody oaths taken in the dead of night, arcane symbology, outlandish getups, code-words and secret handshakes.

Some inside baseball stuff on why the foreclosure mess happened and how it may play out (REMIC, REIT, and other scary acronyms abound, so move cautiously and wear your helmet at all times). Basically: federal regulation, as usual, had unanticipated and deleterious side-effects. Who knew? Some homeowners may find that no single entity actually owns their mortgage note because it has been transferred, sold, packaged and re-packaged and re-securitized so many times that the chain of ownership was broken. Someone may "own" the loan, but cannot actually produce full ownership-chain paperwork on it. This Washington/Wall Street fire-drill may be the next firecracker to blow up in Obama's face.

One of the founding members of the Legion of the Boned, New York, is on the hook for $200B in public-employee healthcare obligations. Pull quote:

“So far, the market doesn’t care,” said Edmund J. McMahon, the director of the Empire Center. “The market seems to assume, on the basis of nothing, that at some point all of these places are simply going to stop paying retiree health benefits.”

Many decisions are being made on the basis of nothing in this economy. It's what Hope and Change is all about! (As in, "I hope I can find some change in the couch cushions so I can afford to buy food.")

Krugman: "Government spending has not increased in the past two years! It's all lies!" Someone sane: "Au contraire, mon frère!"

Pure crazy-talk, that's all this is. Yet...it begins to sound so plausible.... Perhaps the alien messages coming in through the fillings in my teeth are interfering with my thoughts. It's happened before, you know, until the doctors gave me tiny little capsules with alien-radio suppression nanobots in them. I swallow one capsule every day and the nanobots suppress the alien messages until their tiny little batteries run down. Nights are the worst. The aliens are big fans of the old Baretta television series, and insist on having long discussions with me on whether Rooster was a figment of Baretta's imagination. I insist that Rooster was simply a figment of Baretta's warped cop brain. No one ever spoke to Rooster but Baretta! They also say that Rooster was a pale (well, not pale, but you know what I mean) imitation of Starsky and Hutch's Huggy Bear, but that's a damned lie.

Currency crisis? You're soaking in it!

I thought my wallet felt a bit lighter this morning....

Ben Bernanke has set the world on fire. Pull quote:

Today the yield on commodities far outstrips the yield on US Treasuries. Holding gold would have yielded 34% in less than a year, holding a Treasury note would have yielded a nominal 1%. Likewise, holding wheat futures contract or storing wheat would have yielded 84% in less than one year.

To hell with gold, man! Gimme some of that sweet, sweet wheat! (Levity aside, skyrocketing food prices is not good news for developing countries....)

Washington, Wall Street, and the Banks: incest leads to retarded children. It's science.

There is no plan B.

"And on today's tour of the Acropolis, an exciting new feature for our tourist friends! You get to see Greek cops put a beat-down on striking public workers! Photographs will be available at the end of the tour for five Euro."

Via Insty: Unexpectedly! The MSM always seems to be taken aback by the lousy employment numbers. Week after week, month after month, the news always catches them by surprise. Credulous chumps or willing dupes? You make the call!

I pity da fool who don't buy gold!

Via fellow China-skeptic Jonah Goldberg at NRO comes this piece on why China's "economic miracle" is a fragile facade over some pretty rotten underpinnings. Pull quote:

The harsh reality is this: Japan got rich before it grew old, and China will grow old before it gets rich.

Mark Steyn has been saying this for years.

Like most great tragedies, this one has a fairly simple underlying moral: don't loan money to people who can't pay it back.

If you are pro-business and pro-growth, says the Chamber of Commerce, vote for...the Democrat? Well, if you depend heavily on government subsidies, protectionist trade policies, go-along-to-get-along local politics, and a crony-friendly tax regime, I guess that makes sense. The spice must flow!

More scary chart-fu. The Dollar is taking a dive just like that boxer Fat Paulie paid to lay down in the third round against Killer Kadugan last Thursday.

Does anyone else hear that high-pitched whining noise, or is it just me?

Ten cities that have just leapt to the top of the contenders to host the Ace of Spades Annual Hobo Hunt and Bar-B-Q! With bonus "wing the drifter" games for the kiddies! Sponsored by Val-U-Rite Vodka and Olde Tyme Peppered Hobo Jerky.

This is why "follow your dreams" is often really shitty advice. Remember, kids: It's not, "What do you want to do?". It's, "What are you able to do?"

Former (and maybe future) California Governor Moonbeam:

The conventional viewpoint says we need a jobs program and we need to cut welfare. Just the opposite! We need more welfare and fewer jobs. Jobs for every American is doomed to failure because of modern automation and production. We ought to recognize it and create an income-maintenance system so every single American has the dignity and the wherewithal for shelter, basic food, and medical care. I’m talking about welfare for all. Without it, you’re going to have warfare for all. Without a universal health care like every other civilized country, without a minimum level of income, this country will explode. You can’t blame the guy at the bottom forever. At some point there’s a reaction and we’ll see that the real criminals are those calling the tune, making the rules, and walking to the bank.

Alas, California; poor boned, broke, doomed California. If you vote this dumbass into office, you deserve every ohm and erg of the screwing you're going to get. Roger L. Simon has some additional thoughts.

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Oh God only knows, God makes his plan
The information's unavailable to the mortal man
We're workin' our jobs, collect our pay
Believe we're gliding down the highway, when in fact we're slip sliding away