"There's a rumor going around that states cannot go bankrupt. This rumor is not true."
- Angela Merkel speaking at a private bank event last month in Frankfurt
We've got a strong field, one where I feel anybody could - but nobody wants to - win it. Iceland almost showed everybody how it's done a few month back, now the other competitors seem to be jockeying for position to see which country will be next to go. While many fingers are being pointed at the US for causing much of the current financial pain, one need only look at the strength of the dollar to see that most investors at least are betting it won't be the US winning the race to national bankruptcy. Based on currency values, again the Euro nations must be in a good position, right? Not so fast, Italy and Ireland are both looking like prime candidates to cause the collapse of the grand experiment. Looking further east however, at those EU members who aren't yet part of the monetary union, we see a few more likely victims. The falling value of the zloty, forint, leu and koruna seem to be trumpeting the possibility that it will be Poland, Hungary, Romania or the Czech Republic to be first to the finishing line in a race nobody wants to win. The Baltic states are making a stronger case that it may be one of them. Even wackier, how's this for a dark horse - Austria.
While the US continues to look for new ways to throw money into a dark pit by giving away money to banks and car companies, the value of their dollar seems to be living in an alternate universe as it climbs against most of the world. Arguments for this occurring centre around the fact that in times of crisis investors move their capital to traditional 'safe' bets; here the dollar reigns supreme. But what about that ballooning debt? Well, not to worry, the government is sinking trillions of dollars into the banking industries et al to ensure a growing economy, so the numbers will come down eventually, right? Wrong. Without discussing the complete waste of money that are the bailout and stimulus packages, (ie. throwing good money after bad, not investing in the future - school and green technology anyone?) even if there hadn't been an economic meltdown, the US economy was already well on the road to disaster. Simple math, income statement stuff - aging population with the baby-boomers on the verge of retirement (that's right 2009 means those born in 1946 turn 63!) equals lowered income from taxes plus higher medical and social security expenses spelling disaster. Even the days of dollar hegemony in world trade (read: oil), bond auctions and other nations foreign reserves seem numbered. From Kish in Iran to Beijing's planned experiment to make the yuan the new dollar in the east, their are ominous signs that the world has finally tired of financing the US debt. I've argued on more than one occasion that the dollar's days are numbered and there are others who do it better than I.
But I digress, if the US dollar is going up, there must be a lot worse currencies to be holding onto. Unfortunately, I find myself holding onto a lot of Polish zloty as I'm living here in Poland and I can attest to the fact that I'm a lot poorer today vis-a-vis the US and Western Europe than 6 months ago. The situation is similar in the other newer EU states. Faced with the double whammy of falling economic activity and even faster falling currencies, many of these nations are facing bankruptcy. Not only are the prices of imports going up, financing prices are skyrocketing for both individuals and governments. Consumers who were suckered by banks into taking low interest Swiss franc loans are now paying much higher payments and governments are being forced to pay higher rates to issue sovereign debt. Standard and Poor's seems to be dividing the Eastern European countries into 2 groups: the first includes The Czech Republic, Poland, and Slovakia who are likely to fare better in the current crisis because of their more resilient private demand and greater fiscal flexibility, while in the second group are the three Baltic countries, Bulgaria, Hungary and Romania, all of which are highly vulnerable. In fact, S&P downgraded Latvia's debt to junk status last week and threatened the same action for the other Baltic states following the fall of the the Latvian government.
While these countries don't have a printing press as powerful as the US Federal Reserve, they do have the EU to play white knight. However, even here there are big cracks appearing in the foundations. When word leaked that Germany was mulling some bailout options for their eastern neighbours this drew a sharp warning from the ECB as such a move would be against the EU treaty's “no bail-out” clause which prevents members of the eurozone from supporting other members that are facing rising public debt. Members of the euro currency club are feeling the pinch as well. Thanks to monetary union, you can no longer bet on individual nation's exchange rates. But thanks to credit default swaps, you can place convenient bets on the break-up of the eurozone. Last week, speculators bet on an Irish default, these bets make it more expensive for Ireland to refinance its debt, thus threatening to turn into a self-fulfilling prophecy. The cost of insuring Irish debt hit 350 basis points 2 weeks ago, meaning that for every £100 of debt it would cost £3.50 to insure against default; a year ago it would have cost 10p. Ireland isn't alone in the Union with messy finances, Italy, Greece, Spain and Portugal don't look much better as spreads on government bond issues are soaring as credit ratings are lowered. Italy's public debt is the third largest in the world, 104% of GDP, what the Economist calls the 'ogre in the attic'. Welfare minister Maurizio Sacconi said back in December, "There is something worse than recession, and that’s state bankruptcy: an improbable, but nevertheless possible, hypothesis." Meanwhile, the crisis in the east could reinforce the problems in the west as their banks hold $1.74 trillion in former Soviet-bloc nations' debt. Austrian banks are the most exposed, with eastern European loans totalling 75 per cent of gross domestic product. Over half of Austrian bank Raffeisen's debt portfolio is based in the east.
The world is facing an economic crisis of unknown proportions and thus far the financial gurus have been trying to put a band-aid on the flow of red ink by administering the same cure that got us into this problem, issuing more debt. I haven't even considered the problems facing nations outside the US and EU; the Ukraine looks even worse, Ecuador and the Seychelles have already defaulted. The question is who's going to suck up all the new debt? With the US looking to secure $2 trillion and other developed nations about a $1 trillion in new debt, the problem becomes who is there left to finance it? Hillary Clinton went to China to beg them to keep buying treasuries while others are looking to the IMF and World Bank. Eurozone countries are getting into a bad habit of failing to meet bond auction targets. The IMF has already extended over $50 billion in emergency credit to Hungary, Ukraine, Iceland, Pakistan and Hungary. With other nations lining up they are desperately trying to raise more funds, world leaders are calling for a doubling in IMF resources to $500 billion. According to ING Wholesale Banking, emerging-market governments and corporations need to repay some $6.8 trillion of debt this year. In an effort to stop the free fall of Eastern European currencies the central banks issued joint statements to the effect of 'hey, the market doesn't reflect economic fundamentals, besides, we'll join the Eurozone soon'! Sometimes you have to know when you can't help everyone, a tipping point can be reached where the attempt to save one more costs the lives of everyone. That's why lifeboats have a maximum capacity posted - though I'd imagine it would have to be one helluva tough bastard who'd be able to watch someone drown while the rest watched in silence. There can no longer be any doubt that the world is faced with the prospect of financial Armageddon and it's time to decide who to let on to the escape pods. I know, I know, it's human nature to save a drowning person, but trying to save everyone is financial suicide.
Thursday, February 26, 2009
"There's a rumor going around that states cannot go bankrupt. This rumor is not true."
Tuesday, February 17, 2009
In case you missed it, tomorrow marks one week since Morgan Tsvangirai was sworn in as Prime Minister of Zimbabwe. Also, in keeping with my recent theme of birthdays and evil, February 21st will be President Robert Mugabe's birthday. Causes for celebration, no? Maybe, but once again the news out of Zimbabwe seems to be going from bad to worse. Mugabe has perfected his imitation of Muhammed Ali's rope-a-dope fighting technique, always seeming to come off the ropes at a difficult angle, his opponents never able to get a clean shot. Sadly, the constant stream of bad news has not only created apathy outside of Zimbabwe, where most have grown immune to the absurdity of the situation, it has also lead to the only opposition voice accepting a deal that seems doomed to failure.
The illusion of compromise is what Mugabe and his South African collaborators have crafted over the past few months. After what seemed like endless wrangling, a power sharing deal was finally worked out where Tsvangirai would become PM and his MDC party along with the Arthur Mutambara's breakaway faction would be granted 16 ministerial posts (13 & 3) while Mugabe would remain President and his Zanu-PF party would get 15 ministries. All good in theory, all bad in practice. The issue of who would get which ministry took ages to sort out; first Mugabe grabbed the three most critical posts, defence, home affairs - which is in charge of the police - and finance, but in the end conceded the finance ministry to the MDC and a sharing arrangement for home affairs. Here's where the real comedy starts. The swearing in ceremony for the ministers took place last Friday, coincidentally the same day Tsvangirai's pick for deputy minister of agriculture was arrested, charged with conspiracy to commit banditry, sabotage and terrorism. Roy Bennett, a former white farmer (well, he's still white, but his land was stolen by Mugabe) and current MDC treasurer has been jailed indefinitely. Next, Mugabe brings a list of 22 names to be sworn in as ministers at the ceremony (remember, only 15 Robert), causing delay and confusion which eventually resulted in around 35 ministers being sworn in when the original number was to be 31 (best list I can find is here). I'm afraid the battle that took place over the scraps of power, fist fights were reported, will be indicative of what's to come as the survival instinct kicks in for Mugabe's cronies.
If not for the Bennett arrest, the biggest ministerial story would be the finance portfolio. In a country where inflation is off the charts (does 6.5 quindecillion novemdecillion percent - 65 followed by 107 zeros make any sense to you?), they've recently minted a 100 trillion dollar note, gold is exchanged for necessities and a move to the South African Rand and dollarization is occurring, the most important post allocated to the opposition MDC should be that of finance minister. Tsvangirai chose long time supporter Tendai Biti, a man who until just a few weeks ago was languishing in a Harare prison on treason charges. In what are said to be his first comments on receiving word of his posting, Biti was quoted as saying, "The job is the worst in the world but I will have to look the job in the eye and I have no doubt that I will be equal to the task and will prevail". The economy is broken and he will have little real power to do anything as central bank chief Gideon Gono, an ally of Mr. Mugabe’s, pulls the levers. Gono has done everything possible to drive the economy into the ground. The man living in a 47-bedroom house has overseen the collapse from exporting powerhouse to the present state and to this day doesn't blame Mugabe or himself, but, like his boss, blames the west. The root cause can clearly be found in the land seizures of the white minority commercial farms, destroying property rights, collapsing food production, foreign investment, lending and land values, with a bit of international (never effectively targeted) sanctions to wrap it up. The vicious circle, once started, has only been reinforced by every stupid move that Gono makes.
Unbelievably, it appears things are about to actually take a turn for the worse instead of improving. There are growing whispers that there could be a coup in the making, orchestrated by the Joint Operations Command (JOC), a five-man body comprising the chiefs of the army, air force, police, prisons and intelligence - the most powerful men in the country. All five boycotted last Wednesday's and Friday's swearing-in ceremonies for Tsvangirai and the country's new ministers. Tsvangirai himself seemed to hint at this reality the other day saying "We have to budget for some residual resistance from those who see this deal as a threat to their interest". In a Guardian interview he went on to say, "Unfortunately people are preoccupied with Mugabe as a person. They need to get over it. This has gone beyond Mugabe. People need to stop talking about him as the only issue. Mugabe is part of the problem but he is also part of the solution. He is not the obstacle we are now facing". Even more worrying are the acts of provocation against the MDC: the arrest of Roy Bennett, and the refusal to release political prisoners whom Tsvangirai has demanded be released. The same men have openly declared they would never salute Tsvangirai. It's no wonder as these five have the most to lose if the new government manages to function and reduce corruption: everything from choice land to having first dibs on the food and fuel that does manage to make it into the country, which are then sold at favourable prices to parallel market operators who profit from shortages. Already the MDC controlled parliament has approved a law that creates a new National Security Council to be accountable both to the MDC and the Zanu-PF.
Keep in mind that Robert Mugabe turns 85 years-old later this month and has been in power for 29 years, even he knows that all things must eventually come to an end. Could his blowout birthday bash this Saturday be a last hoorah? In a country where 94 per cent are jobless and cholera rampages through a population debilitated by hunger, a wish list has been sent out to the party faithful soliciting the following: 2,000 bottles of champagne (Moët & Chandon or ’61 Bollinger preferred); 8,000 lobsters; 100kg of prawns; 4,000 portions of caviar; 8,000 boxes of Ferrero Rocher chocolates; 3,000 ducks; and much else besides...Those who prefer to give in cash, not kind, are invited to send “donations” of between $45,000 and $55,000 to a US dollar bank account." Add to this the revelations of the Mugabe's recent property purchases in Asia, including a £4 million residential complex in Hong Kong, where wife Grace has managed to do some shopping and investing when she's not too busy punching photographers. The investing? In case you couldn't guess, a diamond cutting and polishing venture in China.
Of course, the more likely course of events will see Tsvangirai squeezed out as the JOC is probably acting in concert with Mugabe. After all, Mugabe doesn't have a good record of playing nicely with rivals; remember Joshua Nkomo, the man Mugabe sent the North Korean trained Fifth Brigade to kill. Nkomo escaped, but 20,000 Ndebele civilians didn't. Sounds like the election campaign last year, so the status quo continues and Zimbabwe eventually becomes a failed state. Option 2 somehow sees the power sharing arrangement survive, not likely given the fact that most of the people who are in the Zanu-PF cabinet are the same ones that composed the previous one, which even Mugabe called "the worst ever". The first real test will come shortly as Tsvangirai has promised to pay all 150,000 civil servants salaries pegged to foreign currencies; problem is, there won't be any foreign reserves to pay them as Gono has given it all to Grace to go shopping. Maybe they'll at least have time to force Mugabe to extradite Mengistu Haile Mariam, the former Ethiopian dictator who slaughtered opponents on an industrial scale in the “Red Terror”, to Addis Ababa for execution. Or, will it be door #3, a coup d'etat, with the JOC taking control, most likely with the support of those members of the Zanu-PF who have lost their positions due to the power sharing agreement, perhaps even getting Nkomo's old PF-Zapu party back together? Not exactly Let's Make a Deal where the worst door you could choose often left the contestant with a goat, a luxury beyond the reach of most Zimbabweans today.
Monday, February 16, 2009
My post last week about the lesser-known evil folks in the world was liberating. Finally, I was able to pull my attention away from the US for a few moments; I was getting a little scared as I was beginning to feel like one of those slack-jawed yokels who stop to stare at an accident hoping to see something dead. Suddenly my attention is free to drift around the world, from another bid by Chavez to eliminate term limits, to Zimbabwe where a new Prime Minister was sworn in, to the Middle East where one heck of a messy election will have to be sorted out in Israel, then pulled inexorably east, past Ahmadinejad in Tehran to that crazy guy with the shock of hair jumping up and down trying to get America's attention. That's right, Kim Jong-Il wants Obama to notice him, and what better way than a birthday celebration, communist dictator style.
What style is that you ask? Well, sure there'll be cake, but it's not just candles that'll be lit if reports turn out to be correct. Looks as though those wacky North Korean's could be ready to test out a long-range missile with the capability of reaching Alaska. Today (Monday), North Koreans will be celebrating the 67th birthday of their "Dear Leader" while the rest of the world watches to see if the reclusive nation is ready to test-launch its Taepodong-2 missile, which failed in its first and only test in 2006. A testing would follow up a series of announcements by the North that have been designed to get the world to pay them some attention - after all they are freezing and starving to death. Last month the North announced it was scrapping peace accords with the South, including a 1991 pact in which it recognised their Yellow Sea border as an interim frontier, threatening a military strike over a disputed Yellow Sea border. The world's longest war could easily be reignited with devastating consequences as there are two million troops lined up against each other on each side of the buffer zone between the two countries.
Kim's tirades are aimed at two people, Barack Obama and South Korean President Lee Myung-bak. The former's new administration is still formulating policy, while the latter has taken a hard-line stance against the north, cutting off aid and telling his people "not to worry too much". Here's the thing: while the North may not have the capability to strap them to rockets, they still probably possess 6-12 nuclear devices. With that in mind, Hillary Clinton will be making the rounds this week, but she won't be stopping in Pyonyang. She said, "If North Korea is genuinely prepared to completely and verifiably eliminate their nuclear weapons program, the Obama administration will be willing to normalize bilateral relations, replace the peninsula's long-standing armistice agreements with a permanent peace treaty and assist in meeting the energy and other economic needs of the North Korean people." Thing is, the North isn't interested in normalized relations or a permanent peace treaty. Time and again in the past decade, dictator Kim Jong Il has manufactured a crisis by testing missiles or a nuclear weapon, taking steps to produce bomb-grade plutonium, or expelling international inspectors. In most instances he has been rewarded with diplomatic attention and bribes of food and energy from South Korea, the United States, China and other nations, in exchange for reversing or freezing the actions. The Bush administration took office eight years ago declaring it would not condone such payoffs. It meekly ended, in October, by bribing Mr. Kim to reverse steps toward resuming plutonium reprocessing. As Hillary visits the Asian capitals this week, what better time to get a little attention by test-firing their missile?
As unpredictable as Mr. Kim is, things could be even worse if reports of his health prove correct. Trying to show the world he's still in charge, Kim met with Wang Jiarui, chief of the International Department of the Chinese Communist Party, his first with an outside envoy since he reportedly suffered a stroke last August. With no successor lined up, the most likely result of Kim's demise would be the hard line military leaders taking over. While Kim has been able to play the Bush administration like a fiddle for the past 8 years, Obama is showing signs he's not willing to square dance. In fact, administration officials rejected an offer by North Korea to send an emissary to President Obama's inauguration last month. Meanwhile the South's new nominee for unification minister has been called a "a confrontational fanatic and sycophantic traitor" by the North whose communist party newspaper said last weekend "our country, as a member of international society, has a right to enter space and compete for space science technology." The new American administration still hasn't even had time to name a lead negotiator for the six-party talks so negotiations aren't exactly on a fast-track. Just what does Kim have up his sleeve? Well, hopefully the bright moon halo reported by the North Korean press above Kim's birth place is just a natural phenomenon and not a foreshadow of even brighter explosions.
Thursday, February 12, 2009
Today is the 200th birthday of Charles Darwin AND Abraham Lincoln. Pretty big deal really, both men are still as relevant as ever and both were born on the same day! Sorry, just found out, still having a double take moment. This year also marks the 150th anniversary of the publication of The Origin Of Species, released just a year before Lincoln became the first Republican president. Yes, I know it is just a coincidence that they were both born on the same day; a few have tried to come up with more parallels, but to me it seems fitting that these two men who were so influential on our world were more than just coevals, allowing us to celebrate them both today.
Lincoln and Darwin were both revolutionaries, in the sense that both men overthrew realities that prevailed when they were born. February 12th, 1809, Thomas Jefferson had three weeks left in his second term as president and George III still sat on the throne of England as the Enlightenment was giving way to Romanticism. Before Darwin's work, biology was nothing more than a way of categorizing and describing the world around us; his work showed us that all organisms are connected, giving us a framework for asking questions about the natural world, and about ourselves. Lincoln inherited a shaky democracy, transforming it by winning a civil war and validating the nation's founding documents by ridding America of slavery. They gave us the tools to modernity leaving us a world with more possibilities than when they entered it. Unfortunately, 200 years after their births and almost 150 years after their major accomplishments much of the world still rejects what they taught us and thus hold us back with their ignorance.
Darwin knew what he had to teach the world wouldn't be easy for many to accept, not the least of whom was his wife, a devout creationist. Lincoln entered office after 7 states had already seceded and knew that his actions would likely lead to civil war. As enlightening as both men's influence on the world has been, both still face resistance today. While the Vatican has officially proclaimed Darwin's theory of evolution to be compatible with Christian faith, the world is still plagued by fundamentalists who believe creationism, dinosaurs and humans living together, should be taught in science class. Somewhat ironically, it was the distortion of Darwin's ideas that led to survival of the fittest and the evils of Social Darwinism and eugenics which have been responsible for the continued belief of the superiority of some races and beliefs over others. While Lincoln's Emancipation Proclamation freed the slaves in America, many believe Darwin's ultimate aim in proposing his theory was to show "the brotherhood of the races".
Take a moment today to consider a world without these two great men. In many ways both were the greatest actors of the 19th century, leaving an indelible mark on the world, overcoming self-doubt, depression and adversity. While Darwin waited 20 years and tactfully dropped humans from his seminal work, there is little doubt that his work was partially motivated by the desire to show the brotherhood of man. Where Darwin hesitated, Lincoln acted, but in the end both risked everything for what they believed.
Tuesday, February 10, 2009
Evil comes in many forms. Sometimes it make itself known up front, Darth Vader or Dick Cheney style. They're easy to spot, often commanding headlines and front page stories around the world. Other times, one man's evil is another's hero; here you find folks like Hugo Chavez or Vladimir Putin. However, the most dangerous evil is often the one that flies in under the radar; depending on which media you use, you might not even know they exist until it's too late. Since we don't all have Hugo's ability to identify the sulfur smell of evil and top ten lists are all the rage, here's a top 10 most evil people in the world you may never have heard of.
#10. Joseph Kony - Leader of the Ugandan rebel group the Lord's Resistance Army (LRA). So bad ass the US coordinated an attack with the Ugandan army to try wipe him out at his base in northern Congo. Unfortunately it went Black Hawk Down, worse really as the rebels slipped away and have since been on a wild killing spree from village to village. It's estimated that Kony is responsible for the abduction of an estimated 20,000 children (a number that could be 2 or 3 times higher) to fight in his army since 1988. It appears his rebellion began in northern Uganda as his Acholi people had been excluded from power, then by pledging to rule the country according to the 10 Commandments, he took the religious moniker LRA. He holds the distinction of being the first man indicted by the International Criminal Court. Having been driven out of Uganda, he now makes northern Congo and southern Sudan his killing zone. Maybe Kony has made a deal with the devil as he's never lost a battle and always seems to slip away.
#9. Grace Mugabe - OK, you know her husband, but do you know what a bitch this lady is? She's also pretty good with her fists, beating up a photographer last month as her bodyguard held him down. She steals land, just like her husband who took Zimbabwe from independence, pride, early success with education to pariah state. He stole land from whites, she steals it from blacks he gave it to like Judge Ben Hlatshwayo, who presides in the High Court in Harare. Ironically, the nation's downfall was accelerated with the land invasions that began 2 weeks after the defeat of the constitutional vote in 2000, Hlatshwayo was on the committee that drew up that constitution. Cholera is rampant, store shelves are empty as the economic activity of the nation has been ground to a halt. With the recently issued 500 trillion notes already worthless by now, foreign currency, basically dolarization, has been sanctioned for use. But there's a glimmer of hope as Robert seems to be on the verge of ceding a bit of power to the MDC leader Morgan Tsvangirai, as early as Feb. 11th, but we've all heard it before... Did we mention that Grace isn't too bright? Could just be the syphilis. Plus she made my brother miss a plane once.
#8. General Than Shwe - Leader of the Myanmar (Burma) military junta. An army junta has held power since a coup in 1962, led first by the charismatic and superstitious Ne Win, now his rather less magnetic successor Than Shwe. Along with his fellow generals, they control all aspects of politics and the economy. The army has repeatedly turned its guns against its own people, most tragically in 1988 when a student-led protest movement was crushed, leaving some 3,000 dead. Remember Rangoon, the capital of Burma? Yeah, me too. In 2005, the ruling junta mysteriously moved the nation's capital from Rangoon to a new city called Naypyidaw, carved out of the jungle at a cost of hundreds of millions of dollars. As the masses have grown poorer, the military has enriched itself through timber and natural-gas deals. Last year, a video of Than Shwe's daughter getting married made the rounds in Rangoon, most of the country has no access; Burmese were shocked by the number of jewels dripping from her body — and by wedding gifts valued at an estimated $50 million. Meanwhile, Daw Aung San Suu Kyi, don't know where the Daw came from either, the former Nobel Peace Prize winner languishes and bitches from house arrest. How many years now? 13 of the last 19. You'd be bitching too. Yeah, there was that little flood and land slide thing in 2007, to go along with killing a few monks, but we couldn't get in to see how bad it really was. Dude, crazy town, right across the border from Thailand.
#7. Abdul Qadeer Khan ; Pakistani nuclear proliferator. Or hero. Could fit into the above Chavez/Putin category, but c'mon, he sold nuclear secrets to North Korea, Iran and Libya! Anyway, Islamabad sees him as the father of their nuclear program/hero these days and released him last week; was it a snub at the Americans? I live in Poland, there was just a Polish engineer executed, first westerner since Pearl in Pakistan; it's a miracle because today I can understand the TV, rare for me: scary music, kill the Muslims. Fact is though, I can't think of a country that is more dangerous than Pakistan today. Nuclear weapons and religion don't mix, just look at Israel. Khan sees himself as a hero - is it possible Pakistan needed the bomb because India had it? Balance of power craziness.
#6. Father Floriano Abrahamowicz: Fellow holocaust denier along with Bishop Richard Williamson who is at the centre of a schism healing attempt by Pope Benedict XVI gone awry. The more I read about Vatican II and the ensuing split in the Catholic church and now the personal prelature similar to that of Opus Dei being contemplated for Williamson's Society of Pius X, the more frightened I am. Religious hatred is the biggest problem in the world, they remember in Germany, as Angela Merkel shamed the pope on behalf of the massacred masses enough to cause him to order the good bishop to study up about the holocaust. In an interview with a Swedish station Williamson said there were only a couple hundred thousand Jews killed during WWII and there were no gas chambers in the concentration camps. He also has wacky 9/11 and 1984 stories. John Paul II kicked out Williamson, the Borat of the schismatic ultra-reactionaries, along with two Frenchmen, a Spaniard, an Italian, and an Englishman for being ordained without Vatican permission. Now they're being un-excommunicated in an effort to bring his sect back into the flock. Breaking news is that Williamson has lost his post at an Argentine seminary. (Is it because Poland is a Catholic country that I can't get the video with the Swedish channel: this link comes up "This video is not available in your country", even though Williamson lost the court case to restrict it.)
#5. Pramod Mutthalik: Leader of the Sri Ram Sena, an extreme right-wing Hindu group often referred to as the Hindu Taliban, connected with the ruling BJP government. Spotting the religious theme yet? If you missed the attack he ordered carried out two weeks ago against women in a college-town bar, here you go:
The Taliban comparison is apt, as in addition to hating women, they smash art, attack rivals, disdain fashion, abduct and torture, and are even being linked to the 2006 Malegaon terrorist blasts which killed 37 and injured over 125.
#4. Ronald Larsen: American land owner in eastern Bolivia. A Montanan no less, so it's the wild west in eastern Bolivia. Hypocritical of me as well, seeing as the indigenous leader of his nation (Evo Morales playing the part of Robert Mugabe) is trying to force whitey off the land. Morales won another Constitution vote last month, making it certain that there will be more armed confrontations as the government tries to move Larsen and other land owners off their land. Limits on land holdings of 5000 hectares have led to Larsen trying to reduce his holdings by giving them to his Bolivian born sons, one of whom was Mr. Bolivia in 2004 (and he's married to a former Ms. Bolivia). One of his ranches, Caraparicito, where most of the confrontations have occurred, is 37,000 hectares alone. He's got over 104,000 more. Accused of slavery, kidnapping and obstruction already, the government will come for the gas rich land, in the name of saneamiento - sewage, running water, that kinda thing. Did anybody else notice that Bolivia is now known to have the most lithium in the world, enough to power the battery-powered car boom, not the Hunter S. Thompson stuff. Pro Larsen arguments here - I feel guilty, the Mugabe parallels, I really like Evo Morales.
#3. Avigdor Lieberman: Leader, Yisrael Beiteinu (Israel Our Homeland) party. In case you missed it, with the Gaza massacre distraction for land grab going on, there's an election in Israel today and unfortunately Lieberman and his party will probably hold the key to power if the results are as tight as polls indicate they will be between Netanyahu and Livni. Bibi and Tzipi. Being so close, the winner will need at least a few other parties to join the coalition. Lots of kids are gonna vote extreme right, Lieberman, for "security" with the top concerns being Gaza, rockets and of course Iran - always nearing the point where they can wipe out the country, launching satellites and now preparing for an election of their own. Of course this all plays together, an Ahmadinejad victory later this year combined with a hard right leaning Knesset equals trouble. Imagine, in a few months we'll all be watching an Irani election closely, and cheering for a guy named Khatami.
#2. Angelo Mozilo - Former head of Countrywide, the largest sub-prime mortgage lender in the US. These lenders have of course been accused of using misleading marketing to push unsuitable mortgages on sub-prime homeowners who could not afford to service the debt, the root cause of the credit crunch. During the housing boom, Mr Mozilo reportedly earned $470 million in salary and other income. Yes, even kickbacks to politicians are involved while he unloaded $141 million in stock options before the company's share price collapsed. Could of picked any of a number of people in the financial industry; runner-up - Kathleen Corbet, head of the biggest credit agency Standard & Poors back when they were rating Mr. Mozilo's and whoever else's debt derivatives AAA in a crazy system where companies pay for ratings. The Japanese "yen from heaven" scam guy Kazutsugi Nami a close third representing the Bernie Madoffs of the world
#1. Ken Ham: Some may think I'm giving Ken a raw deal making him numero uno. Perhaps you'd prefer Carl Baugh, Ben Stein, or "Dr" Kent Hovind. Just pick one, they're all evil. Fact is, in celebration of Charles Darwin's 200th birthday this week, there is no more fitting spot than atop this list for this group of lie spreading creationists. Ken just happens to be perhaps the most public face, what with his Creation Museum and all. These are some sick puppies. If you've made it to the end of this top 10, then you deserve to watch these freaks taking the piss out of Ken, poor Aussie never knew what hit him. (read accompanying story of the first day of the creation museum from another perspective here)
Well, that got a little long, and there's so much more to say about each plus so many more names to add to the list. Let me know who you think belongs in the comments below.
Saturday, February 7, 2009
So much has been written about the bailout and Michael Phelps that I'm loathe to add to the blog-o-mess. Can't seem to avert my eyes though, staring at America as it goes supernova these days is too much like the irresistible pull of the solar eclipse, truly blinding. However, I'm not going to waste your time by going on about the fact that weed is less harmful than many government sanctioned drugs, well maybe a bit. Nor will I bitch about the incessant bickering between the Democrats and Republicans over the stimulus package...well, that too a bit. In fact, let's talk about the two together, here's my plan.
Legalize marijuana. Period. That's your stimulus plan. None of this medical weed debate where 72 year-old milk carriers bring relief to dying patients. It's legal for everyone. By doing this you can save enough money to pay for the green energy investment that is necessary to pull the world economy out of depression. Oh yeah, it is a depression, even Gordon Brown says so. Depression is a euphemism created in the 30's, collapse is more descriptive (FYI the word recession was also invented in the 30's, during the 2nd downturn in '37). Anyway, the math is relatively straight forward. The savings to government spending would include enforcement, incarceration and social programs. There were 872,720 arrested on cannabis charges in the US in 2007, 89% of those for simple possession. Not thinking about police manpower savings, court time savings of these arrests would be $8 billion plus the US spends more than $1 billion/year to incarcerate only those convicted of weed crimes. Simply taking that $9 billion plus the $6 billion in taxes we could make on the sale of marijuana, say 16% tax rate on the approximate and conservative $36 billion in US production, (lots more coming in from Mexico and Canada) would bring a cool $15 billion total. California already makes over $11 million (as high as $100 million) on medical pot sales alone, America has a little jail overpopulation problem having the highest per capita jail population in the world, sounds like a perfect fit.
Of course, this is the green revolution, so we invest this stimulus solely in renewable energy. I'm talking bio-gas, solar, wind, geo-thermal, tidal, the works. The creativity of our newly empowered workers will aid in this as well. Both alcohol and tobacco are more harmful than weed. The Lancet journal (the Lancet for crying out loud, Britain's big medical journal) released a report in 2007 that ranked marijuana less harmful than the two based on harm to the individual, society and dependence inducement (addictive power). Heroine and coke lead the pack, alcohol and tobacco at 5th and 9th respectively, weed in 11th - my Yemeni favourite, khat, came in 20th. Not to mention the relief, even life saving benefits, it brings to those suffering from many chronic illnesses. Unfortunately, marijuana has been the victim of a propaganda war for a couple of centuries, from cotton producers who wanted to get rid of the more versatile and easier on the soil hemp as a competitor, to Mexican haters and even Mormons. The first federal US regulation was the Narcotics Act of 1914, which regulated heroin, cocaine, and marijuana. The only trouble is that cocaine and marijuana are not technically narcotics; the word "narcotic," when used in English, has historically referred to opium derivatives such as heroin and morphine.
Overcoming this disinformation, as when discussing many subjects these days is the biggest barrier. Logistically it would be difficult, but not as difficult as the hangover we're in for in a few years from the stimulus package that the government is going to feed the country. Guess that's the difference between whiskey capitalism and the green revolution, another benefit to smoking over drinking, no hangover. Somewhere around 6% of the US population smokes grass regularly (half the population has tried). Michael Phelps just lost his Kellogg's deal, hello, can we say perfect spokesman. With him on board we should be able to grab at least 10% of the market to grow revenues a bit, 14 gold medals dude. Go Reefer Man:
Thursday, February 5, 2009
Thank goodness for Rush Limbaugh. Oh, wait, there's more: also, Bill O'Reilly, Sean Hannity and what the heck, throw in Michael Savage, Laura Ingraham and cute little Mark Levin too! It gets even better; I think we should have a parade in honour of Sarah Palin. Am I off my rocker? Have I lost my mind? Gone coo-coo for Cocoa Puffs? Nope, not yet at least. Here's the thing, all these conservative nut jobs are so out of touch with reality, such anathema to the rational person, spewing the most fundamentalist of beliefs, that they guarantee the Republican party will stay out of power for the foreseeable future.
Pity poor Michael Steele. Here's a man tasked with taking over a party that has just lost the White House to go along with huge losses in Congress for the second straight election. This Republican party ain't Lincoln's, hasn't been since 1876, Jim Crow and all that. Heck, look at the other candidates he beat out to become the RNC chairman: one a man well known for defending his membership in an all-white country club and another notorious for circulating a parody called "Barack the Magic Negro." In his letter of candidacy for the RNC chairmanship, Michigan Republican Party chair Saul Anuzis observed, "We were once the party that America trusted on national security. But when intelligence failures and poor planning led to unexpected challenges in Iraq, America lost faith in our party. We were once the party of fiscal responsibility. But when members of our own party led the way in pork barrel spending, which led to the fattest federal budget in history, America lost faith in our party." I couldn't have said it better myself.
It's hard to imagine the party coming up with any new ideas, it's dangerous. Step out of line and the axe comes down pretty swift, in the form of a Limbaugh lashing. Yes, the man who when questioned about his hopes for the Obama presidency said, "I hope he fails"; the same man who was kicked off Monday Night Football for saying that Philadelphia Eagles quarterback Donovan McNabb was only starting because he was black. This doctor shopper is now in charge of the Republican party. To illustrate one need look no further than the case of Rep. Phil Gingrey who had the audacity to defend his party leadership from some typical Limbaugh self enlargement. Senator Gingrey said, "I mean, it’s easy if you’re Sean Hannity or Rush Limbaugh or even sometimes Newt Gingrich to stand back and throw bricks...they’re not in that position of John Boehner or Mitch McConnell." For suggesting that these right wing nutters show leadership instead of complaining, Gingrey's office was flooded with angry calls forcing him to not only issue a retraction stating that Limbaugh, Hannity and Gingrich were "the voices of the conservative movement’s conscience", but also to apologize on air to the hate radio host for what he self-debasingly called "foot in mouth disease". This apology to the man who told his listeners: "[Barack Obama's] not black … he's a human being," adding "We are being told that we have to hope he succeeds, that we have to bend over, grab the ankles, bend over forward, backward, whichever, because his father was black, because this is the first black president." Talk about bending over and grabbing the ankles.
It gets worse for the Republican party I'm afraid. A recent Rasmussen poll found that 55 percent of Republican respondents said the party should be more like Sarah Palin (insert double-take with huh? sound effect here)! I guess that explains the lack of new ideas out of the Republicans, there hero is too busy with other things. She's created a PAC, originally enough called SarahPAC to help get like minded conservatives elected. There's also all the time she has to spend complaining about the unfair media coverage she received during the election. Don't think she's relevant? Maybe not, but she seems to think she can command an $11 million book deal advance. Oh yeah, plus she's still governing a rather large state and spends a lot of her time shooting wildlife from airplanes.
The rear view mirror is even more distressing. Even in defeat, the policies of the past eight years continue to be the mantra. So what's the plan to get the Republicans back in power Dick Cheney? Easy: hope for the stimulus plan to fail or a major terrorist attack. Both of which are likely due to the Obama administrations policy of actually talking with people to solve problems according to an interview with Politico. In the same interview, the man who got rich out of sending his countrymen to die in the name of oil chided the Democratic party for the many tax indiscretions made by some of Obama's appointees. For shame, they must be morally weak! At the same time he was busy attempting to vindicate his authorization of torturing suspects by claiming that waterboarding had helped to avert other 9/11 type attacks. You see Barack, the way to solve conflict is to lash out you silly man, never open dialogue.
So where does this lack of a viable opposition party leave America? Some would say much weaker than with a strong, vibrant Republican party, one with new ideas and something to add to the discussion. I say good riddance to bad rubbish. A one hit wonder like the GOP is nothing but dead weight, one that you can try to appease by watering down legislation, but in the end will just act like the spoiled children they are. Perhaps it could even spell the end of the anachronistic two-party system in the US which could do a world of good. When you have a multi-party system you quite often end up having to learn to negotiate - and heaven forbid - compromise. What exists now is stale and diseased. Take the recent House stimulus package vote, where not a single Republican voted yes. Instead of lamenting the lost opportunity, Michael Steele speaking at a GOP retreat said, "The goose egg that you laid on the president's desk was just beautiful, absolutely beautiful": yeah we lost and didn't have any new ideas of our own, but we sure showed him! The US deserves a system where there doesn't necessarily need to always be a loser for every winner, one where the victories can be shared. Sure the line between right and wrong may become a bit more blurry, but imagine a world where there's more than just a choice between Coke and Pepsi.
Monday, February 2, 2009
Protectionism. And Poland and Poznan, where I call home these days. While waiting for the tram the other day I noticed an ad for a popular magazine in these parts, Wprost, kind of a Polish version of Time if you will. My rudimentary Polish allowed me to decipher the gist of the cover story, which basically boiled down to "Buy Polish". A subtle sign, but, in case you missed it, protectionism is back and ready to reek havoc on the globalization dream of the neo-liberal economic movement. P is also for patriotism, a bullet proof cloak that protectionists love to drape around themselves, especially in times of crisis. It may sound strange for me to admit it, but one thing the neolibs have right in theory is that the free flow of goods and services around the globe can benefit the world. Without open markets each country wastes resources producing goods in which it has a comparative disadvantage, and consumes too little of imported goods. Of course we've never actually got to the point of true free trade, all trade is managed, but the pendulum is about to start swinging toward protectionism again.
When the Group of 20 countries met in mid-November, everyone agreed to "refrain from raising new barriers" to trade or investment over the following 12 months. Showing how much the agreement meant, India increased tariffs on steel, iron and soybeans a few days later. The APEC leaders made a similar pledge that same month. However, promises quickly lose their authority when the world seems to be collapsing and workers are being thrown out of work en masse. Recent economic downturns have had global trade as a major engine of growth to help pull the world's economies out of recession, Japan in the 80's, China after 9/11, however, this time is different. The similarities to 1931 keep popping up, this time it's trade barriers.
While it's a stretch to compare the current US stimulus package with the Smoot-Hawley Tariff Act of 1930, which raised tariffs on over 20,000 imported goods, there is a clause that raises alarm bells. The stimulus package contains a "Buy American" rider, the American Steel First Act, which would ensure that only US-made steel will be used in $64 billion of federally funded infrastructure projects. The as-yet-unpassed senate bill is even worse as it stipulates that all stimulus-funded projects use only American-made equipment and goods. Trade war anyone? Combine this with the anti-NAFTA rhetoric thrown around during the election campaign and we've got a recipe for disaster. There's already rumblings up north about the clause as Canadians feel they're being unfairly left out of the bidding extravaganza. Along with the rest of the world, they see the move as another example of the US trying to force the world to follow one set of rules while creating another rulebook for themselves. The tipping point will come and the resulting domino effect of retaliatory trade barriers will prove disastrous for world trade and the global economy.
Back in December the World Bank released a forecast that world trade would fall for the first time since 1982, 2.1%, compared to growth of almost 10% in 2006 and the estimated 6.2% for 2008. Smoot-Harley wreaked havoc on trade, with US imports from Europe declining from a 1929 high of $1,334 million to just $390 million in 1932, while U.S. exports to Europe fell from $2,341 million in 1929 to $784 million in 1932. Overall, world trade declined by some 66% between 1929 and 1934. Need an effect to match with the cause? US unemployment in 1930, before the passage of the bill was at 7.8% in 1930, jumped to 16.3% in 1931, 24.9% in 1932, and 25.1% in 1933. The latest US unemployment number, 7.2%. Add to that the importance of international trade to the economy today compared to then. In 1930 global trade as a percentage of GDP was in the single digits, it hit $16 trillion in 2007, equal to 31 percent of world GDP. Another factor was brought up in Davos on Satuday by British PM Gordon Brown. The Institute of International Finance predicted capital flows to emerging markets would slow to $165 billion in 2009 from a record $929 billion two years ago. “What you’re seeing is a form of financial protectionism where banks retreat to their home base,” Brown said. French finance minister Christine Lagarde said at a Jan. 31 press conference in Davos that bank bailouts and fiscal stimulus plans are “implicit protectionism.” Additionally, the binge of new borrowing by the US and other central governments will surely put a squeeze on on other borrowers, in terms of a shortage of available financing and higher long term interest rates.
Much of the world is focusing their attention on China as countries look for ways to boost national economies. With America and the world already pointing fingers at what is perceived to be currency manipulation to maintain an exporting edge, Chinese officials announced a series of measures to boost domestic production last month. State banks are being directed to lend more to exporters, government research funds are being set up and a measure to provide $12 billion worth of letters of credit to Hong Kong exporters. This comes at a time when American quotas on many Chinese garments have just expired on the heels of a WTO challenge in which the US accuses China of providing illegal subsidies. Meanwhile Indonesia has imposed a series of measures that will make it harder to import Chinese goods. Train producers are crying foul, claiming the Chinese market is closed to importers while at the same time Chinese manufacturers are using technology acquired from western companies on the condition it not be used in production meant for export for just that purpose.
There are many other signs sprouting up of the growing tide of protectionist policies. Ecuador announced it was lifting tariffs across the board, with the levy on imported meat jumping from 25% to 85.5%. India raised steel tariffs and Russia has boosted levies on imported cars. France has pledged $7.6 billion to shield home industry from "foreign predators". "British jobs for British workers", a slip of the tongue by British PM Gordon Brown a couple of years back is coming back to haunt him as strikes rage across Britain, with much of the fury aimed at foreigners. France was paralyzed on Thursday by a nationwide strike, Greece has seen mass riots along with a few other EU members. You may be asking yourself where is the WTO in all this? I thought we had agreements in place to stop just such a thing from happening. Nope. The rules have too many loopholes such as not requiring government stimulus plans to be open to all bidders.
The next meeting of the so-called Group of 20 comes in April. By then the world should have erected enough barriers of trade to make the Great Wall look like child's play. True free trade with an even playing field creates certain economic advantages. Unfortunately, what has been created over the past 60 years courtesy of GATT through the WTO, along with the World Bank and the IMF, is a playing field so tilted that it finally fell over. Sadly, instead of ending a system where an EU cow receives more in government subsidies than half of the world's population earns in daily wages, about $2, the focus will continue to be on throwing money at the banking system. Of course the WTO is trying to maintain calm, releasing a 14-page report last week claiming "there has been only limited evidence so far of increases in tariffs or non-tariff barriers, or increased resort to trade remedy actions"; the EU and China are pretending to play nice, while doing exactly what the WTO claims isn't happening, placing new duties and lodging anti-dumping complaints, the Doha dream suddenly seems beyond reach.
Some idea of the vicious circle of these protectionist measures can be illustrated by the increase in tariffs being imposed by the EU on Chinese fasteners. Duties will rise from 63% to 87% on 200 different kinds of screws and bolts. So not only could China consider retaliatory measures, but the cost of producing everything using those fasteners in Europe will go up, from cars to DIY projects. This increases the price to the ultimate consumer, leaving them poorer than they would have been without the duties, thus reducing their spending on other goods. While the Obama administration is seen by the world as a breath of fresh air, there is a waft of the musty, protectionist policies of the past. Anti-NAFTA talk, and Chinese currency manipulation were themes of his campaign while Treasury Secretary-designate Timothy Geithner is an outspoken critic of China's yuan policy. Aid to US auto-makers and now the stimulus package with it's "buy American" clause, a flag waving, trade war instigating, global economy killer. Could it be that the Democrats really don't know how economics works? Well, I suppose that would make them just like the rest of us.
As passed by the House, Section 1110 of the American Recovery and Reinvestment Act of 2009 says, "None of the funds appropriated or otherwise made available by this act may be used for a project for the construction, alteration, maintenance, or repair of a public building or public work unless all of the iron and steel used in the project is produced in the United States."
Sunday, February 1, 2009
Well, the bye week is finally over, time for the game as the Pittsburgh Steelers play the Arizona Cardinals in Super Bowl XLIII. As always, there's tons of numbers swirling around the game, from jerseys to per half second commercial costs along with firsts and lasts, highs and lows and over/unders. Watching the game with non-Americans is an experience as all the nuances and ins and outs have to be explained, often involving long-winded descriptions delivered during the plethora of commercial breaks, then remembering that the commercials are why many people are watching the game. However, I do miss the Super Bowl party most of all, snacks and drinks and wacky side bets involving everything from who will win the coin toss to the colour of the Gatorade poured on the winning coach.
I'm looking for a Steeler victory, somewhere in the 29-28 range; could be wishful thinking though as I'm even figuring in a safety for the Steeler defence to go along with a few touchdowns and a field goal. This year's game will at the very least mark the first time the Cardinals have made it to the Super Bowl, a championship created by the merger of the AFL and NFL leagues in 1967. Kurt Warner will be trying to win his 2nd, his first came in an MVP performance with the St. Louis Rams in 2000, a game that featured one of the all-time best endings in SB history; the last two plays were absolutely riveting. It's hard to get video as the league is quite active in enforcing their copyright claims, hope this link holds up. Damn, Eddie George was good and look at Isaac Bruce!
One day someone will have to explain to me why the league would want to make it impossible for someone who can't get to a TV to at least see the game. Isn't it about exposure to the commercials? The commercials... They were having a hard time selling the last of them this year according to the grapevine, but managed to get them all sold thanks to lots of early pre-selling. Not surprising considering the $3 million per 30 second cost. If you happen to live in the Peugeot Sound area, or get KING outta Seattle, you can even see a 1/2 a second add for a seafood restaurant. NBC also claims to be running the first 3D commercial, promoting the upcoming DreamWorks Monsters vs. Aliens movie. However, I swear I have a memory of Coke trying the same thing once. This time it's Pepsi, through its Sobe Lifewater that's trying the gimmick, distributing the 3D glasses which apparently can be used again the next day for some NBC show called "Chuck".
The bigger commercial news seems to be ads we won't see. FedEx and GM have opted out, a good call considering their financial situation. Wrong signals and all. Last year FOX decided against political adds, this year PETA made a pro-vegetarian add that, NBC declined to run because, get this, " it depicts a level of sexuality exceeding our standards". Guess I need another video here:
Umm, did they say something about standards? Guess they don't remember the catfight ad that proved so successful it spawned a sequel the following year:
miller light catfight
The game itself isn't stirring quite as much hype as normal. There's a lot at work here, Arizona being a lesser known small market team, post-inauguration hangover and of course the financial firestorm. That said, I'm looking forward to an interesting game, the quintessential big offense versus tough defense battle. Warner and the Cardinals have the trifecta firepower at wide receiver, with Larry Fitzgerald, Anquan Boldin and Steve Breaston all going over 1,000 yds receiving this year and Fitzgerald in particular stepping up to big time playmaker status. Meanwhile the Steel Curtain defense has lived up to it's historic legacy. Look for the Cardinals to jump out early again just as in the NFC final, but the Steelers to grind out a final minute victory. Billions will be going through Vegas where the crisis won't dent profits much if at all. So called propositional (prop) betting has exploded in popularity ever since William 'the refrigerator' Perry made many a little richer by scoring in the Chicago Bears '85 Super Bowl victory and paying off at 20 to 1. My favourites this year are whether Cardinal owner Bill Bidwell's bow tie will be red or not, the over/under 1:54 for the rendition of the national anthem by Jennifer Hudson (a former American Idol contestant?), and who the MVP of the game will thank first (pssst, betcha there's a deity favoured).
While I won't get a Super Bowl party again, I can still play Super Bowl drinking games while watching the game between the commercials. Back to those, I'll leave you with my top five all-time Super Bowl commercials, from Mean Joe Greene and Coke and a time when we called copies duplicates, through the Bud frogs and Cindy Crawford in the 90's, sandwiched in between, the iconic ad that launched the Apple Macintosh in 1984.
Mean Joe Greene 1979
Xerox monks 1977
Apple Macintosh 1984
Budweiser from 1995
Cindy Crawford Pepsi