The Best and the Brightest

Obama's one-trick wizards: One wants to ask the Wall Street wizards who comprise the talent pool for the incoming administration, "If you so smart, how come you ain't rich no more?"

Failed financiers run the Obama transition team. It used to be that the heads of great industrial companies got the top Cabinet posts. Now it is the one-trick wizards. After George W Bush fired former Treasury Secretary Paul O'Neill, who had run Alcoa, the last survivor of the species was Vice President Dick Cheney, the former CEO of Halliburton. Obama's bevy of talent comes from finance. American industrialists have become figures of ridicule, like the pathetic chief executive of General Motors, Rick Wagoner, begging for a government loan.

History Lesson

JC Penney: As Penney later said, “Give me a stock clerk with a goal and I’ll give you a man who will make history. Give me a man with no goals and I’ll give you a stock clerk.”

In 1959, Penney cast the sole dissenting vote when Penneys board of directors decided to offer credit cards to customers. Penney explained to his fellow board members that he understood the company had to keep up with its competitors, but he did not approve of policies that encouraged customers to go into debt.

If CO2 Traps Heat, How is Cold Beer Possible?

If carbon dioxide traps heat, then how is cold beer possible?

We will not stop carbon taxation and central government control over business with graphs, databases and algorithms. The scientifically ignorant general population will continue to tune it out and trust the scientists that the authorities deem experts. The way to win a political battle is with political strategies.

The public needs to be convinced by their daily experience that carbon dioxide does not trap heat. If we can make each and every encounter with cold carbonated beverages a reminder that CO2 doesn’t trap heat, then every Coke or Pepsi consumed and every Coors, Bud and Miller advertisement reinforces that message. If heat trapping carbon dioxide becomes a public joke, then the foundation of dangerous man made global warming crumbles in the court of public opinion.

If CO2 Traps Heat, How is Cold Beer Possible?

Mama says: Last week an EPA appeals board dumped another coal plant, and said the EPA should develop national rules for CO2 emissions. That ruling is widely believed to have placed about one hundred coal plants in jeopardy, at a time when the US is rapidly running out of electricity. Plants in Utah, New Mexico, Kansas and Georgia have all recently been stopped by legal action.

That leaves the US with no new drilling, no new nuclear plants, no new hydro plants and no new coal plants. In short, it leaves us with no real substantial new energy sources except perhaps plants that burn natural gas. Wind and solar will not do it, nor will biodiesel.

Our Foundation of Promises

Denninger: If you think the stock market is bottoming then you must have some sort of belief that the credit markets are improving. I'm sure you can explain, then, why the IRX (13 week T-Bill) is yielding a whole 1/11th of a percent (annually!) … Barack Obama made the statement that "deficits are not important" on 60 Minutes Sunday.

He is going to get a rude surprise; the President of the United States is subservient to the bond market - specifically, he is subservient to the willingness of foreigners to finance our deficit spending. Embroiled in their own mess this capacity is quickly eroding, and over the last ten years our Treasury has put itself in the unenviable position of shortening the maturity of its outstanding debt (to get lower interest rates) which raises the potential of a rollover funding "emergency".

I have said it before and I'll say it again - President Obama is going to find himself on the wrong end of reality, and be forced into austerity measures that neither he or Americans are going to like one little bit. I wouldn't want his job when he is forced to go on Prime Time TV to tell America that we simply can't finance our profligate spending any more and that serious, real, across-the-board cuts are going to have to be made to our federal budget, entitlements and "promises" - that we simply cannot keep those promises.

Past Performance is the Available Evidence

The Myth of the Clinton Surplus: While not defending the increase of the federal debt under President Bush, it is aggravating seeing Clinton's record promoted as having generated a surplus. It never happened. There was never a surplus and the cold hard facts support that position. In fact, far from a $360 billion reduction in the national debt in FY1998-FY2000, there was an increase of $281 billion.

Verifying this is as simple as accessing the U.S. Treasury website where the national debt is updated daily and a history of the debt since January 1993 can be obtained. … Understanding what happened requires understanding two concepts of what makes up the national debt. The national debt is made up of public debt and intergovernmental holdings. The public debt is debt held by the public, normally including things such as treasury bills, savings bonds, and other instruments the public can purchase from the government. Intergovernmental holdings, on the other hand, is when the government borrows money from itself--mostly borrowing money from social security.

Notice that while the public debt went down in each of those four years, the intergovernmental holdings went up each year by a far greater amount--and, in turn, the total national debt (which is public debt + intergovernmental holdings) went up. Therein lies the lie.

History Lesson

Read This: You can’t really tell someone that you asked him to lunch to let him know that you don’t think of him as evil. Nor can you tell him that you asked him to lunch because you thought that you could trace the biggest financial crisis in the history of the world back to a decision he had made.

Objects in the Air

Dangerous times are here. Be observant. Be cautious.