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Render Unto Caesar and One Trick Pony Pressures

Thursday, February 14, 2008

There has been little mainstream media recognition of one of the primary themes of this blogger, and that’s the One Trick Pony (OTP). OTP is the benefit all governments in the US have received from Bubble economics. It’s the old money for nothing concept. Unfortunately when Bubbles leak or even worse burst, so does OTP. I believe that is what is rapidly happening and government coffers are now reflecting it.
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Where the Rubber Meets the Road

Wednesday, February 13, 2008

Following on yesterday’s theme that new debt issuance will start to reveal the true state of fictitious capital (FC), we again witness a failed auction, this time in muni paper. The is particularly ironic given the ludicrous “Buffet Offers to Bail Out Munis” snare Aunt Millie headlines run by Wall Street lap dog and roper, CNBC. Looks like this Three Card Monte scheme had a shelf life of about a day. My gut (which has gotten much smaller being out of the US) tells me this rejection of Uncle Warren’s “offer” now opens the way instead for credit downgrades of the monoline insurers.
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More Ponzi Finance Dilemmas

Tuesday, February 12, 2008

Increasingly we are getting clues about the real versus fictitious market. The real market (our primary focus) tends to show up when various Ponzi finance issuers attempt go ashore for fresh supplies from the natives. Here we see their dilemma, the Riskloves are in retreat, Aunt Millie is broke (see first chart, cash in bond funds) , and interest in crap is not forthcoming. Notice the lack of transparency from College Loan. This also reflects the tokenism of their strategy: collect fees upfront and smile alot. It fits perfectly with the Winterism matrix discussed in yesterday’s post that should be tattooed on the foreheads of my serious readers.
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Old Maid Cards: a Zero Sum Game

Monday, February 11, 2008

The card game of Old Maid is running rampant. The ball to watch is who gets stuck with Old Maid Card (OMC) fictitious capital (FC). Who wins and who loses, and who hold the Cards. If you can spot via luck and or skill (and you will likely need both) the holders of OMCs, your chances of surviving financially will be enhanced. OMC action will be a primary focus of this blog going forward. There are several variations of this zero sum OMC game:
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Coal in Your Stockings

Friday, February 8, 2008

Not surprisingly retail same store sales checked in punky for January. Given the high rate of inflation in the US economy, in real terms this suggest that units of goods must be falling off a cliff. As you can see from the forecast expectations were strangely high, and of course now the cognoscenti are making new bullish bets on stimulus and rate cuts.
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Do the Crime, Do the Time

Thursday, February 7, 2008

A new trend is a foot. Homeowners (fraudsters?) are jingle mailing, and just turning over the keys. In places like California there are few consequences to doing do. “Lenders” should not be “surprised” if that’s the least line of resistance. Who would a thunk that owners without skin in the game would turn over the keys where the bank eats the loss? Surprise, surprise, there is no incentive to refinance.
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Debt Trap: Where’s the Risk Love?

Wednesday, February 6, 2008

Following on my theme in recent posts about a big bear coming in bonds, comes word that the expected budget deficit has swelled to $410 billion for the fiscal year. The causes, not unpredictably, are the demise of the One Trick Pony (see primer on Winterisms in sidebar) and the stimulus package. Look for a series of upward revisions of these numbers going forward.
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Carbon Trap: the Perfect Storm

Tuesday, February 5, 2008

Shifting back to China we are now seeing the effects of slash and burn economics, as a key region is being shut down. A key variable once again is pollution, and not accounting for the pollution’s negative externalities and input good costs (for example coal). This has been an expedient and a totally failed economic policy, and the blowback will be similar to what happened in the Soviet Union. And it’s now happening fast, with the big snowstorm being a catalyst.
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New Radio Free Wall Street Podcast Notes

Sunday, February 3, 2008

Lee Adler and I recorded a new Radio Free Wall Street podcast, and what follows are related notes.
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The Road Warrior Cliff Dive

Friday, February 1, 2008

China is now in a full court press to export inflation to the US. This is a natural consequence of trying to close the big gap between input and output costs. Apparently their need to rein in out of control resource utilization will mostly be dealt with via blowback from Road Warrior economics.
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