Why Democrats Can't Win

[Homer_Rice]

Interesting [url="http://www.ppionline.org/ppi_ci.cfm?knlgAreaID=114&subsecid=144&contentid=253831"]piece[/url] by a labor economist. I think he's wrong in an interesting way: it is precisely because Dems have abandoned the FDR-like approach that the party is unable to build a coalition; not to mention the damage the acceptance of this fellow's approach has done by policies put out by like-minded Dems (re - Clinton in many respects.)

What's wrong with the moderate, older Democratic party coalition, oriented around policies which ensure hope and opportunity for the working and middle classes? I've asked this many times of fellow Dems--from the loony environmentalists to the radical one issue folks. As Keats suggested, "the center cannot hold, things fall apart."

Until Dems find some broad turf which is reasonably non-controversial (as least among Dems), the Republicans will keep winning, nothwithstanding their recent displays of poor governance.

[Jason]

[quote name='Homer_Rice' post='261322' date='May 1 2006, 12:12 PM']Interesting [url="http://www.ppionline.org/ppi_ci.cfm?knlgAreaID=114&subsecid=144&contentid=253831"]piece[/url] by a labor economist. I think he's wrong in an interesting way: it is precisely because Dems have abandoned the FDR-like approach that the party is unable to build a coalition; not to mention the damage the acceptance of this fellow's approach has done by policies put out by like-minded Dems (re - Clinton in many respects.)

What's wrong with the moderate, older Democratic party coalition, oriented around policies which ensure hope and opportunity for the working and middle classes? I've asked this many times of fellow Dems--from the loony environmentalists to the radical one issue folks. As Keats suggested, "the center cannot hold, things fall apart."

Until Dems find some broad turf which is reasonably non-controversial (as least among Dems), the Republicans will keep winning, nothwithstanding their recent displays of poor governance.[/quote]

Ya know, Diva and I were watching a re-run of Dharma and Greg the other day. The entire group of the various liberals were arguing over something, and could not come to any sort of consenus on an issue, becuase each had their own cause that conflicted with someone else's cause.

Which is why Democrats have not had a majority vote in a national election since Jimmy Carter. Even with the main stream media in their hip pockets.

[Homer_Rice]

LOL. I've had conversations like that too many times, sadly.

Here's the thing: pretty soon the nation is going to need a broad policy along the lines of FDR's economic policies during the Depression leading into WWII.

Simply stated, we need to rebuild the nation or settle for third world status.

[Guest Coy Bacon]

It's over. The billionaires are grabbing up everything that isn't nailed down in preparation for the collapse.

[Nati Ice]

blue collar vs executive pay ratio


1980 - 10:1$

2006 - 460:1$




NOW IF THAT AINT "PROGRESS" I DONT KNOW WHAT IS!!!

[Guest bengalrick]

what really sucks, is that both parties are doomed right now... unfortinately, its pretty much up to "who screws up less"...

the democrats have a ray of sunshine, if they use it correctly and don't assume the house, senate, and presidency is already theres: immigration

the republicans also have a chance at helping their party: balanced budget...

if either party has a good plan for these issues, the other is screwed... if both parties do these things, then there will be an actual competitive race in 06 and 08...

but my guess is the dem's will continue to be split and ignore the immigration issue, while the rep's continue to be unifed yet dumb for not going full blast w/ the balanced budget plan... maybe i'll be wrong...

good post homer... i've said this for a while, but you were right a week or so ago, when you said i should be working on changing the republicans instead of railing on the democrats all the time... one is bitching, and one is effective.... thanks for the kick in the ass....

[Jason]

[quote name='Nati Ice' post='261736' date='May 1 2006, 11:50 PM']blue collar vs executive pay ratio
1980 - 10:1$

2006 - 460:1$
NOW IF THAT AINT "PROGRESS" I DONT KNOW WHAT IS!!![/quote]

While I agree the ratio is a little skewed, I have 2 comments.

1. The fact of the matter is the blue collar worker is also making more real money now than they were in 1980.

2. So what? Why do you really care what someone else makes? Get the best you can get, and mind your own business about what someone else is making.

[Homer_Rice]

[quote name='Coy Bacon' post='261726' date='May 1 2006, 11:42 PM']It's over. The billionaires are grabbing up everything that isn't nailed down in preparation for the collapse.[/quote]

I agree. This system is finished. It is just a matter of what comes after, though there is an outside possibility that there will be some policy interventions over the next few months to ameliorate the worst of it. I'm skeptical as long as this crowd runs the White House. At a minimum, Cheney has to go, if for no other reason than to push the "war" card away from the table a little bit.

On a fairly positive note, the halfway decent folks on Wall Street are positioning themselves to intervene and are currently preparing policy options. I'm referring to the Rubin crowd.

I'm trying to talk to the folks I know about the dangers. The trouble is, most of us Baby Boomers are living in a fantasy world and the generations after us are simply ignorant of the scale of the danger. So, one group is shitting their pants, but too many BBoomers like the comfortable feel of shit in their pants, so they refuse to acknowledge reality. Come September/October, it will probably be too late, and many of us will get the Hoover treatment if this is so.

Rebuild America. Create the credit facilities to direct investment in productive ways. Keep people in their homes and put them to work. Negotitate international agreements which fix currency exchange rates for a period of time sufficient to engage in long-term capital investment projects which can turn this thing around. Anyone who fights against these basic notions is the enemy and ought to be identified and marginalized as such.

Push has come to shove, folks. Some of you just aren't aware of it yet.

[Guest bengalrick]

homer, what do you think is going to cause this future recession/depression? is it the trade deficit or the dollar falling, or other?

[Homer_Rice]

[quote name='bengalrick' post='262157' date='May 2 2006, 04:34 PM']homer, what do you think is going to cause this future recession/depression? is it the trade deficit or the dollar falling, or other?[/quote]

Before I get into your question, [url="http://www.nytimes.com/2006/05/02/world/africa/02zimbabwe.html"]this is the sort of thing we want to avoid.[/url] [b]EDIT: NYT requires registration, if you don't want to register, google news for Zimbabwe hyperinflation.[/b]

If you are asking about proximate causes, I cannot say, br. I refer you to my earlier analogy some months ago about surface tension and bubbles. It could be any combination of events and the reaction to them: housing, oil, dollar-dumping, Fed policy, etc...

The best way to get a grip on this is to look at the long term history of how this problem developed. You could go all the way back to our revolution to begin identifying the factions involved, but more recently, trace the history of the way the world was organized after the end of WWII. Look at Bretton Woods and what it was intended to accomplish, look at how we killed off the space program and chose this post-industrial nonsense (a better word would be craziness.) Look at the various inflection points in this process--the floating currency decision of Aug 1971 is a good place to start: why did this happen and what has been its effect?

The point is this: like all "systems," the underlying premises determine the axioms by which that system operates. Corrective responses, if they are premised from within that system, are either minor tweaks or serve to reinforce existing practice. If the former, it can be somewhat useful, if the latter, it tends to exacerbate whatever perturbations already exist within that system, making those perturbations worse.

The bottom line is this: the divergence between the actual physical goods we produce (and more importantly, the tools we create to produce our physical requirements) and the monetary system which has come to dominate our practice today is rapidly approaching a moment in which the system itself will collapse. We make less and less stuff, and there is more and more "money."

Money itself is just a fetish. It is the actual physical production of goods and necessary services which determine the health of an economy. When an economy is predicated on, or dominated by, non-productive practice, as ours has become, then the divergence I suggested begins to show in many ways. Look around, br, and you'll find all kinds of evidence in the physical economy. You'll also find that the monetarist terms which have come to dominate economic thinking are masking agents--or as I suggested, the kind of corrective policy response which exacerbates the perturbations.

So, why now? What makes me think this is the "end game?" That may be the question you were driving at.

All you have to do is look at prices. Take a market basket of raw materials, i.e. those materials necessary to the fundamental operation of our society. Look at price increases over the last couple of years. Now, and this is the tricky part, look at the rate of growth in those prices, and the rate in which they are growing. In other words, look at how fast a price rises over time. When a price goes up at higher rates over shorter periods of time, then you are approaching hyperinflation.

There may be a concerted effort to deflate in such circumstances, that was one of the responses which led to the Great Depression. We are going in the other direction, though. Bernanke and helicopter money, no more reporting of M-3, the scads of bankers and investors looking for a safe landing spot is artificially driving prices through the roof. When the printing presses are on but the actual production of goods is not sufficient to sustain the introduction of varuious financial instruments in the economy, this is what you get.

There is only one way to fix the problem, speaking generally. It is the production of physical goods which determines the amount of money that ought to circulate in an economy. That's a first approximation, but of course, a little simplistic. The required capital in circulation to fund necessary services such as medical services, education, etc... ought to be a function tied to productive output of tangible goods, and the introduction of new and improved techologies which improve productive output.

Ask yourself this: how much money is chasing other money and has no relation to the physical output of our economy? Why is it that a market basket of goods necessary to support a family is priced higher and higher over the past few decades? Why is it that we have literally gutted our productive capacity? Why is it that living standards have actually been going down over the past 4 decades? Each of these (and other) questions have complex histories, but the answers themselves are not that complicated, when boiled down to their essence.

We have underinvested in physical production at the same time we have deliberately inflated our financial instruments. The divergence cannot last. When that divergence begins to reflect itself in price increases which tend towards exponential growth, then we have hit hyperinflation. We are now rapidly approaching that moment of truth.

[Guest bengalrick]

all very scary stuff... i can see it better, but i am still optimistic about the economic future... i especially see your point about the major increases in the raw materials, mainly gold and oil... but as far as everyday materials, the prices have really not gone crazy... milk, bread, groceries in general are all really held in check... yes, oil has gone crazy, and that has put a strain on a bunch on industries...

what i don't get, is you mention "gutting our production capacity", but isn't the reason for the recent runup, due to our high production? i keep hearing that, and i just want to clear that up...

my eyes are more open though... thanks for the explaination...

[Homer_Rice]

[quote name='bengalrick' post='262317' date='May 2 2006, 08:02 PM']all very scary stuff... i can see it better, but i am still optimistic about the economic future... i especially see your point about the major increases in the raw materials, mainly gold and oil... but as far as everyday materials, the prices have really not gone crazy... milk, bread, groceries in general are all really held in check... yes, oil has gone crazy, and that has put a strain on a bunch on industries...

what i don't get, is you mention "gutting our production capacity", but isn't the reason for the recent runup, due to our high production? i keep hearing that, and i just want to clear that up...

my eyes are more open though... thanks for the explaination...[/quote]

Not sure where the optimism comes from, unless it is wishful thinking or is based on the kind of analysis which "exacerbates the perturbations." Look at the proposals out there that address the economy. Are the solutions proposed coming from within the system in order to maintain the system, or do they suggest a new system, i.e. a non-linear jump to a new framework? Take oil prices, for example.

--Within the system: silly 100 dollar rebate, tax reduction, fuel grade changes, releasing a portion of the emergency stockpile....
--Suggestive of new system: a change to hydrogen-based fuels, extensive deployment of mass transit, everybody walks or rides bikes, etc...

The above isn't entirely fair, as it deals with a component of the overall economic system, but that ought to get you thinking a little about dislocations, their nature, and what might be good or bad consequences resulting from such choices.

[b]If and only if[/b] there are changes which directly deal with bringing production and monetary policies back into alignment will there be a chance for this system.

IMO, food prices are going up at a steady clip. Review the last couple of years at the retail level. To some extent, sales mask these rises. Check your meat prices for example. I love steak, but I rarely buy the stuff any more just because $8 a pound for a good piece of meat is obscene. Have the actual costs of production gone up so much in recent years to justify such a rise in prices? If that is so, then how come my uncle, who raises beef cattle, is still struggling to run his farm?

On over-production: that can be, and often is, a buzzword. Are they refering to capacity; is it some journalist simply regurgitating without understanding? What needs to be measured are the market basket requirements per household versus our ability to provide the goods.

[Homer_Rice]

[url="http://www.farmfutures.com/ME2/dirmod.asp?sid=&nm=&type=news&mod=News&mid=9A02E3B96F2A415ABC72CB5F516B4C10&tier=3&nid=B34CB0CF86514E6B8C7BF315F3B5A7D5"]Fuel/fertilizer price increases[/url] article from last week.

[Guest bengalrick]

[quote name='Homer_Rice' post='262572' date='May 3 2006, 09:13 AM'][url="http://www.farmfutures.com/ME2/dirmod.asp?sid=&nm=&type=news&mod=News&mid=9A02E3B96F2A415ABC72CB5F516B4C10&tier=3&nid=B34CB0CF86514E6B8C7BF315F3B5A7D5"]Fuel/fertilizer price increases[/url] article from last week.[/quote]

the oil prices are going to affect each and every industry... we better get a hold on this quick, or we will be in the trap that you speak of homer... our only chance is to implement a huge strategy to bring the prices down... to me, using your theory, the easiest thing to break isn't the dollar, the housing bubble, or any other thing... those two would be slow developing problems imo... the dollar could continue to slide, and this is a problem, but it won't be the "pop" you speak of... the housing bubble is BS imo, in most secters, excluding the bigger cities like NY and las vegas where the prices of houses really are out of wack, the prices of houses have steadily rose, and i foresee a slow down, but not a bubble... neither of these would cause a sudden problem imo... but gas prices can and have had a pretty big impact on our economy... it is the key problem i do see in our future...

imo, the price of oil is not due to inflation purposes... that is why i don't quite buy into your theory as of now... the price of oil is up b/c of china, india, iranian threats, OPEC cutting production so prices would rise, and that is just on the oil price side of it... gas prices have refinery limitations, taxes, and enviromental problems... we better start now on making more refineries, switching to a nuclear based energy policy, drilling so this doesn't happen again in 10-15 years, cutting state and federal taxes some, and laxing enviromental mixes of gas... then, we better switch out of oil/gas as our main source of fuel for cars, and find a better alternative...

[Homer_Rice]

Don't have time to reply in detail right now, but I do want to say this: We have about six months to get this straightened out.

[Guest bengalrick]

[quote name='Homer_Rice' post='262646' date='May 3 2006, 12:25 PM']Don't have time to reply in detail right now, but I do want to say this: We have about six months to get this straightened out.[/quote]

time to ban together i think, reguardless of party or ideology...

[Jamie_B]

To add to Homer's talk of HyperInflation...

[url="http://news.yahoo.com/news?tmpl=story&cid=509&ncid=509&e=24&u=/ap/20060504/ap_on_bi_ge/mortgage_rates"]http://news.yahoo.com/news?tmpl=story&cid=.../mortgage_rates[/url]

[quote]Rates on 30-Year Mortgages Climb

WASHINGTON - Rates on 30-year mortgages climbed this week, hitting their highest point in nearly four years, a development that will be weighed by people thinking about buying a home or refinancing the one they own.

Freddie Mac, the mortgage company, reported Thursday that for the week ending May 4, rates on 30-year fixed-rate mortgages averaged 6.59 percent, up slightly from 6.58 percent last week.

This week's rate was the highest since the week ending June 20, 2002, when 30-year mortgage rates stood at 6.63 percent.

It marked the sixth week in a row that rates on 30-year mortgages went up. These rates have been rising as Wall Street investors have worried about inflation picking up.

"We expect that the mortgage rates will continue to trend upward over the coming year but that upward trend will be modest at best," said Frank Nothaft, Freddie Mac's chief economist.

Even so, higher rates will affect peoples' appetite to refinance their home mortgage, he said.

"Fewer families will be refinancing; but of those who are, a larger percentage will be drawing some equity out of their homes, many to pay off previously existing home-equity loans and lines of credit as these loans become more expensive," Nothaft predicted.

Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing a home mortgage, also edged up this week to 6.22 percent, from 6.21 percent last week.

However, one-year adjustable rate mortgages dipped to 5.67 percent this week, down from 5.68 percent last week. Rates on five-year, hybrid adjustable-rate mortgages averaged 6.21 percent this week, unchanged from last week.

The mortgage rates do not include add-on fees known as points. Thirty-year and 15-year mortgages each carried an average nationwide fee of 0.6 point. One-year ARMs carried a fee of 0.8 point and five-year ARMs had a fee of 0.7 point.

A year ago, 30-year mortgages averaged 5.75 percent, 15-year mortgages stood at 5.31 percent, one-year ARMs were at 4.22 percent and five-year ARMs averaged 5.16 percent.

Higher mortgage rates are expected to slow home sales this year. For five years running, home sales have hit record highs, powered by low mortgage rates.[/quote]

[Guest bengalrick]

if our economy is about to go into the dumpsters, then alot of investors are being fooled right now...

[url="http://personal.fidelity.com/research/stocks/content/marketsindex.shtml?bar=s"]click here[/url]

[i][b][size=3]U.S. stocks end higher; Dow at six-year high [/size] [/b]
4:32 p.m. 05/04/2006 By Mark Cotton Provided by


Oil falls to one-month low; retailers turn in strong April sales

NEW YORK (MarketWatch) -- U.S. stocks ended higher Thursday as strong April sales results for retailers and a drop in crude-oil prices to a one-month low [b]lifted the Dow Jones Industrial Average to its best level in more than six years.[/b]

Gains came even as the latest data showed a rise in labor costs in the first quarter, a worrying development for those investors concerned the Federal Reserve may have to keep raising interest rates to choke off inflationary pressures.

The Dow industrials rose 38.58 points to 11,438.86, its best closing level since Jan. 20. Of the 30 Dow components, 20 contributed to gains. See performance of Dow components .

The Nasdaq Composite Index (COMP) was up 19.93 points at 2,323.90 and the S&P 500 Index (SPX) climbed 4.40 points to 1,312.25.

Chuck Carlson, the chief executive of Horizon Investment Services, said strong corporate results are "trumping all other concerns," including inflation issues and interest rates. [b]He believes stocks will keep an "upward bias" as consumers continue to boost the economy[/b]. Listen to audio report.

[b]For Art Hogan, chief market strategist at Jefferies & Co., the productivity data released early in the session were somewhat of a double-edged sword for investors worried about the outlook for interest rates.[/b]

[b]"Nonfarm productivity came in better than expected but unit labor costs rose 2.5%, more than double what expectations were, so there is a push and a pull there," he said. The Federal Reserve has made it clear it will be looking closely at data to help it decide the future course of interest rates. The central bank's fed funds rate currently stands at 4.75% and it is widely expected to raise that rate by a quarter percentage point when it meets next week. [/b]

The market, meanwhile, could take some comfort from falling oil prices, added Hogan.

On the broader market for equities, advancers outpaced decliners 5 to 3 on the New York Stock Exchange and by 18 to 11 on the Nasdaq.

By sector, semiconductors (SOX), Internet stocks (GIN), airlines, gold stocks (GOX), networkers (NWX), banks (BKX) and brokers (XBD) all moved higher.

Oil services (OSX), energy (XOI) and computer-software stocks (GSO) were the most significant decliners.

Volume was 1.74 billion on the Big Board, and 2.09 billion on the Nasdaq.

Productivity jumps, labor costs rise, jobless claims tick up
Productivity in the American workplace increased at a 3.2% annual rate in the first three months of the year, the Labor Department said Thursday. Unit labor costs -- a key inflation gauge -- increased 2.5% in the nonfarm business sector in the quarter. Both numbers were higher than expected. Economists surveyed by MarketWatch predicted productivity would rise 2.9%, while unit labor costs were expected to rise 1.3%.

Ahead of the April employment report due Friday, the Labor Department reported that first-time applications for state unemployment benefits drifted higher by 5,000 last week to 322,000, the highest level since Nov. 19.

Oil under $70
Crude-oil futures fell to a one-month low as concerns over Iran took a back seat to supply data that showed the first increase in U.S. gasoline supplies in nine weeks and placed crude inventories at their highest level in eight years.

Crude for June delivery ended down $2.34, or 3.2% at $69.94 a barrel, its weakest close since April 7. Gasoline futures, meanwhile, dropped to a three-week low.

Crude hit an intraday low of $69.30, the lowest price seen since April 10.

The energy sector may be able to parry the fall in crude with news that European oil giants Royal Dutch Shell (RDSA) and Total reported better-than-forecast first-quarter earnings, with both companies saying rising oil and gas prices made up for declines in production.

Dollar, gold, bonds, oil
[b]The U.S. dollar traded lower against its major counterparts. The euro rose 0.7% to a one-year high of $1.2711 against the dollar. Earlier, the European Central Bank left its key interest rate unchanged at 2.5% but hinted more rate rises are to come.[/b]

Against the yen, the greenback fell 0.2% to 113.56.

The British pound rose 0.7% at $1.8536. The Bank of England announced it was holding U.K. interest rates steady at 4.5%. Check foreign exchange rates.

Gold futures rose, as part of a broad rally in metals, helped by weakness in the dollar. The benchmark June contract ended up $8 at $676.50 an ounce. Copper futures, meanwhile, closed at a record high.

On the bond market, long-term Treasurys ended little changed as investors kept to the sidelines ahead of the April employment report due on Friday. The benchmark 10-year note ended down 1/32 at 95 1/32, with its yield (TNX) at 5.15%.

April sales sizzle, helped by Easter
Shaking off two months of tepid shopping trends, consumers took to the malls and shopping centers to ring up robust year-over-year sales in April.

"Retail sales were just great across the board," said Charles Rotblut, senior market analyst at Zacks.com. "But I am wondering whether the strong gains are sustainable."

Rotblut said retailers in April benefited from the late Easter holiday, good weather and gasoline prices that began to rise significantly only toward the end of the month. Retailers may not be so lucky with May results.

Wal-Mart Stores Inc. (WMT) set the pace with a 6.8% rise in same-store sales, buoyed by brisk sales of toys, games and candy for the Easter holiday. Sales matched the company's own forecast and handily outpaced the 5.7% average again expected by analysts.

The world's largest retailer, however, is forecasting a slowdown in May, with same-store sales expected to grow 2% to 4%. Same-store sales, a common measure of retail performance, logs sales from stores open at least a year. Wal-Mart shares fell 29 cents at $46.40 after climbing more than 1% in the prior session ahead of the release of its sales figures.

Rival Target Corp. (TGT) posted a 10.4% rise in April same-store sales, a touch ahead of the 10% average target of Thomson First Call analysts. It sees May same-store sales increasing 4% to 6%. Target shares fell 0.7%.

Also in the discount space, Costco Wholesale Corp. (COST) posted a 7% rise in same-store sales, ahead of analyst estimates, while BJ's Wholesale Club Inc. (BJ) managed a 1.2% gain in April, again ahead of Wall Street expectations. Costco was up 2.9% but shares of BJ's added 0.7%.

American Eagle Outfitters (AEOS), Limited Brands (LTD), Pacific Sunwear of California (PSUN), Abercrombie & Fitch (ANF) and The Gap Inc. (GPS) all posted same-store sales that came in ahead of analyst estimates.

But it was not all good news.

Sharper Image Corp. (SHRP), the electronic gear retailer, saw same-store sales tumble 32% in April. The stock was off 3.6%.

Other retailers that underperformed include Chicos's FAS (CHS), Pier 1 Imports Inc. (PIR) and Hot Topic (HOTT) .

Starbucks Corp. (SBUX) tacked on 3.9% to $38.79 after the ubiquitous coffee chain saw second-quarter profit climb 17% to $127 million, or 16 cents a share, ahead of analyst expectations.

Other standouts
Shares in Tyco International (TYC) rose 3.6% to $27.92 after the company, with interests in electronics, health-care and fire and safety devices, booked a strong second quarter and announced a $2 billion share buyback.

International Paper Co. (IP) reported a loss of more than $1.2 billion for the first quarter as it held out several paper-making businesses for sale in a far-reaching restructuring program. The stock fell 9 cents at $36.97. [/i]

[Homer_Rice]

You've been warned.

[Guest bengalrick]

[quote name='Homer_Rice' post='263705' date='May 4 2006, 10:31 PM']You've been warned.[/quote]

think about it this way homer... if you are right, then why should i try to make more money and provide better for my family? there isn't anything [b]I[/b] can do about it, even if i do agree w/ you... but if everything is about to be meaningless, i can do one of two things 1. scream "run for the hills... we're all gonna die!!!" 2. continue my life as normal

[Chris Henrys Dealer]

Non farm payrolls this morning was to the downside. +138k instead of consensus of +200k. It's a number that used to be hugely relevant, but there seem to be so many revisions now it's usefulness is questionable. same can be said for a lot of economic stats these days unfortunately and a pretty strong belief amongst a lot of traders that some of the figures are being smoothed.

Personally, I think the best indicator of economic strength will come when the IRS releases it's figures from the take from tax season. Its a simple relationship, more income tax collected = more income. Thereby you can argue that people were better off, if the income in real terms was greater than inflation.

BR, the rate rises for the Eurozone will be bullish for the Euro, and push the dollar lower. (A rise in interest rates encourages saving) You could argue this might drive more people to buy US stocks from abroad....as the USD becomes cheaper. But it could just as much make people invest in the Euro as it would be expected to rise in value.

But remember the largest market in the world even though it doesn't get as much press is the US Treasury market. And holders of US treasuries don't like the dollar going lower as it hurts their return. If they look to move out of treasuries, that then hurts the Fed's ability to fund the deficit. Basically, existing debt is being paid off through the issuance of new debt. But if the unit of currency its in is losing value, people / governments will be less likely to hold it.

Look at the rise in the price of gold over the last three years. Nothing material has changed in the demand for gold for manufacturing levels. The annual consumption is still the same as it was. Maybe growing at 3-5% per year. But the price has risen from 350 per ounce to $700 per oz. because people are treating it as a currency. In the face of a weakening dollar, people will move to other stuff to preserve return or make money. This is a big reason for the commodity price boom we are seeing in oil, gold, copper, silver etc.

[Homer_Rice]

[quote name='bengalrick' post='263899' date='May 5 2006, 09:41 AM']think about it this way homer... if you are right, then why should i try to make more money and provide better for my family? there isn't anything [b]I[/b] can do about it, even if i do agree w/ you... but if everything is about to be meaningless, i can do one of two things 1. scream "run for the hills... we're all gonna die!!!" 2. continue my life as normal[/quote]

or 3, lobby for preventive solutions...

or 4, engage in a hesychastic bit of self-reflection, like this courtesy McSweeneys...

[quote]COOKIE MONSTER
SEARCHES DEEP WITHIN
HIMSELF AND ASKS: IS ME
REALLY MONSTER?
BY ANDY F. BRYAN

- - - -

Me know. Me have problem.

Me love cookies. Me tend to get out of control when me see cookies. Me know it not natural to react so strongly to cookies, but me have weakness. Me know me do wrong. Me know it isn't normal. Me see disapproving looks. Me see stares. Me hurt inside.

When me get back to apartment, after cookie binge, me can't stand looking in mirror—fur matted with chocolate-chip smears and infested with crumbs. Me try but me never able to wash all of them out. Me don't think me is monster. Me just furry blue person who love cookies too much. Me no ask for it. Me just born that way.

Me was thinking and me just don't get it. Why is me a monster? No one else called monster on Sesame Street. Well, no one who isn't really monster. Two-Headed Monster have two heads, so he real monster. Herry Monster strong and look angry, so he probably real monster, too. But is me really monster?

Me thinks me have serious problem. Me thinks me addicted. But since when it acceptable to call addict monster? It affliction. It disease. It burden. But does it make me monster?

How can they be so callous? Me know there something wrong with me, but who in Sesame Street doesn't suffer from mental disease or psychological disorder? They don't call the vampire with math fetish monster, and me pretty sure he undead and drinks blood. No one calls Grover monster, despite frequent delusional episodes and obsessive-compulsive tendencies. And the obnoxious red Grover—oh, what his name?—Elmo! Yes, Elmo live all day in imaginary world and no one call him monster. No, they think he cute. And Big Bird! Don't get me started on Big Bird! He unnaturally gigantic talking canary! How is that not monster? Snuffleupagus not supposed to exist—woolly mammoths extinct. His very existence monstrous. Me least like monster. Me maybe have unhealthy obsession, but me no monster.

No. Me wrong. Me too hard on self. Me no have unhealthy obsession. Me love cookies, but it no hurt anyone. Me just enthusiast. Everyone has something they like most, something they get excited about. Why not me? Me perfectly normal. Me like cookies. So what? Cookies delicious. Cookies do not make one monster. Everyone loves cookies.

Me no monster. Me OK guy. Me OK guy who eat cookies.

Who me kidding? Me know me never actually eat cookies. Me only crumble cookies in mouth, but me no swallow. Me can't swallow. Me no have no esophagus. Me no have no trachea. Me only have black fabric throat. Me not supposed to be able to even talk.

Me no eat cookies.

Me destroy cookies.

Me crush cookies.

Me mutilate cookies.

Me make it so no one get cookies.

Everyone right. Me really is cookie monster.[/quote]

[Guest BlackJesus]

[b]In Democrats defense .... they do win

- All of the major cities

- Amongst those with Graduate degrees

- Amongst those that live in Cities where they are actually exposed to the rest of the world

- Amongst those that don't believe in Virgin Birth



However .... as the country gets dumber .... Republicans get more powerful [/b]

[Guest bengalrick]

[i]or 3, lobby for preventive solutions...[/i]

like cutting some useless programs, cutting our dependancy on oil, moving towards using nuclear energy, and cutting our peoples dependancy on our government?

i know, i'm just being a smart ass, but all of these things would help our economic outlook, right? among other things that i'm sure you can come up w/... that is my point, i have my demands, you have yours... its shouldn't be hard to compromise the two positions together....

[Guest bengalrick]

[quote name='BlackJesus' post='263959' date='May 5 2006, 11:34 AM'][b]In Democrats defense .... they do win

- All of the major cities

- Amongst those with Graduate degrees

- Amongst those that live in Cities where they are actually exposed to the rest of the world

- Amongst those that don't believe in Virgin Birth
However .... as the country gets dumber .... Republicans get more powerful [/b] [/quote]

funny people are getting "dumber" at the same time that everybody has more information than anyone of our parents ever dreamed of, w/ the internet.... hmmm....

i call bullshit....