Living Life Creatively

The upside of a downturn...

Point of view is essential in thriving during difficult circumstances. In his book Man's Searching For Meaning Viktor Frankl made a crucial observation about the psychology of those who survived the Holocaust and those who didn't. It was in the art of living. While in concentration camp he was determining that if there was meaning in life, then suffering had some meaning and mental attitude towards it determined the outcome of having suffered. This lead him to the conclusion that inner strength and refusal to surrender to the horrors of the concentration camp and instead looking to the future made the difference in who made it and who didn't.

While we live in an economic downturn that means a long term recovery period is ahead it cannot be compared to the horrors of a concentration camp. It means difficult times and the need to readjust standards of living but it is not the tragedy some people will take it as. Those are the people who will not do well because they are not looking toward the future down the road to better times but are living in the past and not accepting the present. Those of us who look across a barren empty lot and see the one flower blooming will flourish and see the future as blossoming into something better.

Yesterday I was driving through the high desert of dry grassland and off in the distance I could see the one large hardy tree that had drilled a taproot deep into the earth and was drawing water to live. I saw beauty in that landscape and that tree. It was a marvelous thing and had nothing to do with economic indicators being all down, whether the debt ceiling was raised by Congress, whether Obama settled for "The Deal." There was only one person who had any beauty in the questionable politics of the vote in Congress, although she may not match the political beliefs of some of us, in the ceremony of mockery our politicians made of our country she stood out.

It was Gabrielle Giffords who exemplified someone who tragically suffered at the hands of someone else and saw the future and fought not only to survive but thrive and come back from the calamity that struck her.

If we are to not only live and survive through the next decade in rebuilding our lives and our country we must adopt a vantage point of survival that is conducive to thriving and conquering arduous times. My suggestion is not only to live creatively, but devise ways to make what appears at first to be ugly, turning them beautiful. You do not need to be an artist to do this. You don't have to be able to paint, draw, take photographs or create videos, do crafts, lathe fine furniture, grow a beautiful garden. You simply have to find the aesthetic out of even the bleakest of scenes.

When I was growing up my father did work that took him to third and fourth world countries, some are now emerging economies but at the time they were not. Although we had to be mindful of our safety it was not as dangerous as today and we went to far flung places. The education I received was more than I could learn in any school. I will share one story that has stuck with me my entire life. It was in a place quite close to the US and under the most deplorable conditions we went to visit a family that he had come to know. They treasured knowledge and were especially grateful to him because he would bring them books. All over the walls of the shack they lived in a shantytown were cutouts from magazines or any source they could find of pictures of things of beauty. They might have come from advertisements that depicted something unique or a work of fine art. Outside the home was ugly, inside they were surrounded by pictorial items to inspire and comfort them.

There is a lot we can learn from that.

Of Great Social and Political Import

A stopped clock is right twice a day...

American Exceptionalism, Individualism, Mutual Help will restore us.

The progressive peddlers of programs and tea party tinkerers of taxes are locking horns in Washington DC and personally I don't subscribe to either major political party's agenda. My belief is neither side is acting in the best interest of the American people but merely serving their own purposes. I keep hearing a variation on the statement "they are trying to drive us back to the pre-Depression era." 'They' being I suppose that enigmatic collaboration of tea party, Republicans and conservatives and the complaint coming from liberals who have redressed themselves as progressives. My first thought is I wonder if anyone has considered that the programs of the Great Depression may be what got us into the Disruption Depression we are in today? That and consumerism.

There is a ridiculous headline in the Wall Street Journal "Slow Growth Stirs Recession Fears." Recession? What!? A recession implies a bump in the road and what we're experiencing is far larger than a recession. Statistics can be manipulated anyway someone wants but the reality is our credit rating will be downgraded regardless of any machinations of the Administration, US Treasury, Congress or Wall Street. There are two systemic problems that cannot be ignored by printing money. We are overleveraged as individuals and so is our government and additionally unemployment has become structural. Therefore if people are not able to productively earn money then debt cannot be paid off and will be repudiated.

We never pulled out of the recession in 2009 as some economists would have us believe, merely suspended it. Paul Krugman of the New York Times can rename this the "Little Depression," after all the damage he has done promoting the excessive printing of money, but the bottom line is we are heading for a long decade of economic restructuring and rebuilding. We will have both stagnation and hyper-inflation more endemic than the US in the seventies and Japan in the nineties. If you take the political and bureaucratic classes in DC and the financiers in New York seriously and rely on them for a solution then the joke is on you. They don't have a clue or care about anything west of I-95 and are concerned only with protecting their own self-interests.

In the long term I believe American Exceptionalism and Individualism is alive and well, although buried just beneath the surface, it is burgeoning resurrection. That ideal will be the ultimate resolution to the death of consumerism by technological and economic disruption and is a great thing. We will relearn and return to what it means to be innovative and creative and produce unique and valuable goods that are useful for the new era. It will take time and hard work. The sooner people recognize that reality we will be prepared to move forward. What our government is doing now is pure folly and nonsensical and you can't make sense out of a nonsensical situation. They are postponing the inevitable by trying to revive a dead concept, the old economy.

The American people must relearn to work for themselves. If it is for an employer they need to embrace the concept of being a free agent and not love an employer because they won't love you back. Americans should accept we are not entitled to anything except what we create by reinventing our lives and subsequently recreating the country. It is about our individual responsibility to take care of ourselves and mutual help with each other. The government cannot simulate or stimulate real people doing real things only real Americans can do that.

Public Unions Vs. The Unorganized Taxpayers

There will be blood...

Public sector employees that are unionized have largely been able to sit out the recession and remain unaffected. They're out of touch with their employers, the unorganized taxpayer, having forgotten they work for the public and taxpayers and not the other way around. They are in the same privileged class as the bankers bailed out by those same taxpayers. As we move into structural unemployment along with high underemployment, with the remaining taxpayers footing the bill for overpaid public sector union employees, the likelihood of civil unrest between these two groups will become greater than we've already seen.

http://youtu.be/5CxP5clZf_g

Economic Doom and Gloom

Survivalist or Survivor? Your choice...

The chief characteristics to personal stability are self-reliance and being prepared.

It seems to me that what many predicted is coming to pass and whether or not it's a "Double Dip" or a "long term slowdown in recovery" is mere semantics. What I think will really cause a collapse of the system is that the political and bureaucratic classes in DC - the Federal Reserve, the Administration and Congress - are playing with fire by making a game out of the debt ceiling, budget, quantitative easing and more. It is unnecessary roughness that serves only one real unintended purpose on their part and that is their own ultimate demise.

My belief is that is where we are heading. A economic crash and system collapse that is unlike any others in the past since we are in an entirely new era. Prior to the 1930s Recessions and Depressions were called Panics. Only history written down the road will name what we are going through but to my way of thinking the best I've heard is Disruption. We are indeed in a Great Disruption of the world as we knew it the past 100 years, since post-WWI, a turning point in history as big as the Reformation, Age of Enlightenment and American Revolution.

I believe America is going to be divided up regionally and not necessarily by contiguous geography but certainly confined to a certain extent by it, into segments of society who survive (and some will thrive) by taking responsibility for their own physical and mental health and working to maintain it. The amount of money, gold or supplies you have may or may not help you but your preparation, planning and wits will. Many of the survivalist camp think their moving off to the woods or for those who stay in towns and cities, growing your own and stockpiling will get them by. I understand that thinking and I do think that now is the time to preserve what you can, store as much as feasible and think of alternate ways to obtain goods in the future other than paper money. Therein lies material for an entire other blog that I'm still contemplating.

What is clear is that economically, therefore politically and socially, things are not improving and we are not "recovering." That is due to the fact that our recovery does not lie in restoring things the way they were and it's taking awhile to get that message through to the markets, people and institutions. This does not mean pending doom for everyone and there is no reason for gloom unless you are unprepared. I recognize some people are trapped in situations they feel they cannot get out of. My thought is "where there is a will there is a way" and it requires thinking through your situation to come up with the best possible solution.

No one promises that will be easy and it never has been in the history of America. Self reliance, mutual help, reinvention and rebuilding are inherent in the American character even if we seem to have lost that in the past 30-40 years. I have every faith it is still alive and well in this country and also in the inherent values of England and the British people.

Here is my video blog of a few weeks ago when the markets were still relatively stable, economic indicator reports had not come out and the debt situation in Europe and the US had not risen to the forefront again. I stand by what I said then.

http://youtu.be/H8GHuyngLZM

Double Dip Storms & Tornadoes

Economic Meltdown?

http://youtu.be/H8GHuyngLZM


Video response to "Mortgage Foreclosure Tsunami 2011" http://youtu.be/Ze9MyGB2tBc 

bin Laden Really is Dead

This is not a topic I intended to write about...

Somehow I feel I must write about this topic although it is really not where I want to go, especially lately, with this blog. I am officially burned out on economics, politics and social problems since they appear to be flat lined at best or getting worse. At this point I think my time, especially creatively, is better spent staying positive and motivating others to rise above and keep going no matter the odds.

However, I cannot ignore the issue of Osama bin Laden's death, the rise of conspiracy theories and the need for people to see pictures, as well as the emotions it is evoking in those directly affected by the events of 9-11-2001. I believe that Osama bin Laden is dead because I have more trust in the US military, their intelligence and capabilities and the CIA (a scary proposition to some I realize) than I do President Obama. I have every good reason to believe our military for reasons, not to be coy, that (even to prove my point) I cannot share. I believe they did carry out the mission, assassinated bin Laden and buried him at sea, in Davey Jone's Locker. The guy who tweeted it inadvertently, Sohaib Athar (@ReallyVirtual), corroborates it to a believable degree and I don't think the US Government or anyone can make people like him up.

What the conspiracy stories and theories are really telling us is about the incompetence of President Obama and his staff, the incapacity to make a sound decision, stick to it, keep a story straight and be honest with the American people. The sheer inability of Obama and his "people" to be consistent indicates their ineptitude but we knew that already. There is no point in reviewing all of the inconsistencies throughout his entire term, he's proven that over and over again, so why should this be any different?

I wouldn't mind seeing blood and guts pictures of Osama bin Laden myself as awful as that sounds. If a reader knew how much 9-11 disrupted my life personally in a very big way then they would understand. Something better in my nature tells me otherwise though.

There is one thing I don't think a lot of the American and European people have thought about. We have been on the verge of a Third World War for almost a year now, if not since 9-11-2001. The killing of bin Laden is probably the equivalent of the shooting of the Archduke Ferdinand of Austria. Worse, this war unlike any previous wars has no real geographic boundaries making it a brand new game of combat. It is a war between Islamic extremist terrorists in a host of countries, who as nation-states may not necessarily be at war with the western world. It is also occurring after the "Arab Spring" of uprisings against oppressive regimes that in many respects refuted his terrorist machinations and making for a difficult summer in the Arab and Persian Muslim world.

Obama probably ought to have released some clear evidence of his death but it would only make things worse now. Doing so would probably inflame some terrorists but by their nature they are already agitated fanatics. We already know from this raid that al Qaeda was planning to attack the US rail network. This event has also already broadened a war on three fronts, Afghanistan, Libya and Pakistan and is likely to plunge the world into deeper global conflict. It's already begun; we're being shielded from it by our government and media, which is worse than releasing photos of a dead man. If there is a conspiracy, that is likely the real one.

My hope, as awful as this is to consider, is that we will not be solving our unemployment problem by working in munitions factories. We need to beware of "foreign entanglements" and engage in a policy of non-interventionism; otherwise we will truly find ourselves involved in a Third World War. More importantly, we must counter conspiracy theorists, despite the inept handling of bin Laden's assassination by the Obama administration. Now, more than ever we need to individually remain focused on maintaining ourselves in a healthy frame of mind, through self-reliance, mutual help and optimism, about our abilities to rise above any difficulties we are encountering. Our time is better spent improving our minds and well-being than focusing on spooks and conspiracies to overcome the barriers we are facing economically and socially in this country.

Economic, Social and Geopolitical

Ayn Rand on neoconservatives...

"Conservative Sellout of Capitalism"

Ayn Rand's reasoning on Religious Conservatives (Social Conservatives), Liberals and Statism in this video from the 1950s is as current now as it was then. It explains why her philosophy is popular again today. Those calling themselves conservatives in favor of free markets and capitalism use three interrelated arguments based from faith, tradition and depravity. These are fallacies that contradict the fundamental principles of the United States.

http://youtu.be/vpp5EXZZrgA

http://www.youtube.com/user/LibertyPen

Geography of the Mind

Overcoming the Misery Index...

The US Misery Index is arrived at by the formula of the unemployment rate added to the inflation rate. In December 2010 the Misery Index was derived by the Unemployment Rate (9.4) plus the Inflation Rate (1.5) to equal 10.9. The formula was first put out in 1970 and created by the economist Arthur Okun. The high of the Misery Index was 21.98 in June 1980 and the low was 2.97 in July 1953. I will venture to say we are on the road to exceeding the high index.

That is not what is important. The Misery Index is a statistical measurement that given the circumstances of high unemployment and inflation of how miserable we could be if we allow the conditions to affect us. It is a negative measurement. My belief is the Misery Index is based on our happiness as consumers and not on our psychological, spiritual and physical well being. The chances that we are likely to be struggling during these times and having difficulty is greater since we are going through a historical transitional period, forcing us to re-prioritize what is truly important. It is very likely those conditions could adversely influence us but our response is critical to our well-being. One key to keep in mind is that conditions are never permanent and always subject to change. If the index is going higher, we need to prepare ourselves mentally for the challenge.

There is no easy pop psychology answer on how we can prepare ourselves, how to respond under these conditions and what we do to rise above adversity. Oprah and Dr. Phil can't help us. Everyone is different and uses individual coping mechanisms and we must each come up with our own answers. The purpose here is not to give advice or resolve in one easy step how to remain strong in a weak economic world but to point out that strength is required.

Strength is required because I also believe we are heading for a clash of economic, social and political values and change that is not going to occur without a fight. If we are ever to reclaim the "American Way" of entrepreneurial individualism after almost one hundred years of creeping "progressive" socialism, sneaking up like a cat burglar, in collusion with the original collectivists, corrupt corporatism elitists, then we need psychological power as well as physical endurance for the fight.

Reference: The US Misery Index

Chart: The Economist online 01/24/11

You Can Quote Me On That

They believe their own public relations...

"There's a mark born every minute and one to trim 'em [rip off] and one to knock 'em [warn away]." Mark Twain

You can't question their belief in themselves and their ability to convince their public and each other, that they are the greatest and there should be no doubt in the stock market, that the purveyors of Wall Street regard themselves with. Their opportunistic manipulative optimism when there are significant problems on Main Street and across the real America is a testament to their removal from reality and is simultaneously surreal and magnificent.

When have you ever known the common broker to tell you to sell? Before the 1962 wild crash? 1973? 1987? 1989 mini crash? 2000? 2001? 2007? 2009? 2010 flash crash? It is in their interest to keep the stock market aloft no matter what, regardless of underlying fundamentals, economic conditions outside of the market and common sense. In a perverse way, you have to admire their capacity to convince themselves and whoever is buying stocks right now, yet one more time, that stocks always go up and never go down. As it stands now they are all looking up, huffing and puffing and blowing, to keep a bubble afloat.

Anyone interested in buying some municipal bonds?

Economic, Social and Geopolitical

Mortgage Foreclosure Tsunami...

Delayed and forestalled Double Dip will occur in 2011

 http://www.youtube.com/watch?v=Ze9MyGB2tBc


Reference:
"Home Prices Are Still Too High" by Peter D. Schiff WSJ (subscription required) http://online.wsj.com/article/SB10001424052702304173704575578190261574342.html

"Dr. Doom Predicts Another $1 Trillion In Housing Losses" [Nouriel Roubini] NYT
http://dealbook.nytimes.com/2010/12/06/dr-doom-predicts-another-1-trillion-in-housing-losses/?ref=foreclosures

"US mortgage foreclosures rise sharply" FT.com (subscription required)
http://www.ft.com/cms/s/0/3825f4b8-1387-11e0-a367-00144feabdc0.html#axzz19iRnoxL6

Thinking Out Loud

Why Unemployment Insurance Can Not Be Extended...

Quote of the Day: Jack Ablin

Bulls and Bears in Tug of War...

"The market is dominated by huge betting from both sides, and this tug of war in strategy reflects the uncertainty of the direction of the market and outlook for the economy," said Jack Ablin, chief investment officer at Harris Private Bank.

"US stocks post best September since 1939"

10/01/10

FT.com Markets

Quote of the Day: Paul Ryan

Say it again with feeling, like you really mean it...

"We need to establish the proverbial lines in the sand and show we are serious about limited government," said Wisconsin's Rep. Paul Ryan, a leading conservative who is in line to chair the House budget committee if Republicans take control.

Rep. Paul Ryan (R, WI)
"GOP Aims to Erode White House Agenda"
Wall Street Journal online 09/20/10

IMHO: Leaders Lacking Imagination

We're being led by Duds and Clods...

You know what really terrorizes me? The enemy within.

They're the people of influence in the Northeast power corridor, especially in New York and the Beltway of DC, that really are not driven by any belief system they are smart enough to understand, even at the basest level. They truly are stupid, unimaginative dull thinkers, far more than we have recognized, and we have placed too much faith and given far too much credit and influence to them in the political class and corporate sector.

I'd rather have a smart enemy than self-interested cunning dullards at the helm. At least you know how to counter with a smarter defense, it's difficult to argue with minds comprised of muddy waters.

Quote of the Day: Mike "Mish" Shedlock

Quite clear the US economy is sliding back into recession, if not still in it...


The average consumer understands that, yet the average economist doesn't.


[At] this juncture, the debate as to whether the recession has actually ended or not is actually moot. The pertinent factor is: if there was a recovery, it now seems over.


Looking ahead, attitudes rule. With consumer spending weak and weakening, and now that the stimulus has run its course, the odds the 3rd and/or 4th GDP numbers will be negative are quite high, as are the odds of double digit unemployment numbers by the end of the year.

Michael Shedlock
65% Fear Double-Dip, 71% say US is Fundamentally Broken,
Net 32% Expect to Reduce Spending
Mish's Global Trend Analysis 09/09/10

Quote of the Day: Michael Boskin

If we can keep it...

The Obama administration's "summer of recovery" has morphed into a summer of economic discontent and anxiety over a weakening economy.


[Not] surprisingly, the left is frantically calling for a second "stimulus" and demanding tax hikes for the "rich" - aka our most productive citizens and small businesses. The rehashed ideas include such nonsense as massive infrastructure financed by a national infrastructure bank, an old Carter idea; yet more aid to the states; and even that worst of ideas, "general revenue sharing," which would force citizens to pay future federal taxes to fund the debt used just to send revenue back to the states.


These ideas would do a lot more harm than good. To paraphrase Benjamin Franklin, we have the best economic system among the advanced economies, "if we can keep it." That will require fundamental policy changes, not doubling down on the failed big government experiment of recent years.

Michael Boskin
"Summer of Economic Discontent"
WSJ 09/01/10

Quote of the Day: John Mauldin

Embrace the challenge...

On how to get through this mess

This is a far different environment than we've had the last 70 years. Using past performance to predict future results when the future environment is significantly different than the period in which the data was collected is misleading at best and worthless at worst, leading to bad decisions. Much better to deal with reality.


[T]he 70s were a real bitch. I woke up many times in the middle of the night with real pains in my stomach wondering whether to pay the rent or make payroll. So did a lot of people. But look at all the new companies that came out of that era and changed everything: Microsoft, Apple, Intel,etc. Cell phones. The Internet. The list is long.


Yes, we have to make our way in this Muddle Through World. It will be challenging, but I can almost guarantee you that when we do there will be other challenges. If it was easy everybody could do it and there would be no money in it. Embrace the challenge!

from "How We Get Through This Mess"
John Mauldin
The Big Picture

We Have Met The Enemy

And He Is Us...

Pogo

Walt Kelly 1971

Jettison and Salvage

Flotsam, jetsam, lagan and derelict...

These days I have no idea what to think about how the deepening economic crisis will proceed. We're certainly deluged with information about it. Does it really matter what graph we look at? Which blog we read? What channel we watch? Realistically we all know one thing, we're in for one heck of a Day of Reckoning and the bottom line of it is debt.

A lot of debt is owed by a lot or people, businesses and governments, borrowed from a lot of people, businesses and governments, that can't pay it back. There's even a question if the money was ever real. It's all in such a big knot too large to unwind so it will unravel. Rapido. At the core, it is that basic.

The news seems grim, America is holding it's breath and pulling it's gut in. The stock market will crash, houses will sell for 10 percent of what is owed on them, banks will fail, unemployment will skyrocket. Prognostications range from doom saying to revolution to enlightenment with some distinct popular trends developing among the variations.

There are a lot of graphs, charts, visuals and words out there to elevate what is already Drama on the High Seas. I'm not oblivious that there is going to be a lot of flotsam, jetsam, lagan and derelict floating around all of us after havoc is wrecked. It's still not clear to me though what purpose all of this information serves to prepare us for dealing with a long-road-back future.

Think I'll  just decide what to jettison, what to tie down and mark ligan, what to let go derelict. Salvage is ongoing and I can't really do much about what goes flotsam


Just in case you did want to look at yet another graph

Today's House Prices Are Still Higher Than The Previous Bubble High
from Business Insider
David Michael White

PRINT five stages of america’s housing bubble

Michael David White is a mortgage originator in 50 states

Quote of the Day: Mish

On the lost momentum of the economy...

The key question, as always is "What Now?"

Geithner, Obama, Krugman all want more stimulus to keep the recovery going. However, as [Caroline] Baum explains, you can't keep something going, that was never going in the first place.

Michael "Mish" Shedlock
"Economist Cut Growth Estimates"
Mish's Global Economic Trend Analysis