Wednesday, October 22, 2014

Racial Animus Is Way Overstated

I work in a racially integrated group. We don't ever have disagreements along racial lines.

When I serve at Catholic Charities, it's quite common to see inter-racial support. My favorite of these was watching a young, black man make sure an elderly, Chinese woman, who spoke no English, was served when it was her turn.

Today, the Washington Post has a long article about the shooting in Ferguson. Here's the key tidbit for me:
Because Wilson is white and Brown was black, the case has ignited intense debate over how police interact with African American men. But more than a half-dozen unnamed black witnesses have provided testimony to a St. Louis County grand jury that largely supports (Police officer) Wilson’s account of events of Aug. 9, according to several people familiar with the investigation who spoke with The Washington Post.
The witnesses cared more about the truth than skin color. They cared more about justice and making sure Officer Wilson wasn't railroaded than whatever race loyalty the media and political leaders expect from them.

Hmmm. It's almost like our media and political leaders want us to form up into racial groups. It's like there's something in it for them when we do.

I wonder what that is.

Tuesday, October 21, 2014

The World Hasn't Come To An End

Fear not

There have been no new cases of Ebola in the US. It appears to be just as difficult to transmit as the experts told us.

It looks like Kobani is turning into ISIS' Stalingrad. Thanks to stepped-up American air power and the grit and determination of the Kurds, ISIS might be stalled there. Neither they nor their colleagues in Al Qaeda have figured out the value in going after the soft American infrastructure like power and water.

Russia is content for now with digesting Eastern Ukraine. There's a limit to what you can do with only a handful of combat-ready brigades. You may have a bigger army than your neighbors, but if you're going to launch Barbarossa, you need the Wehrmacht. Russia ain't got it.

The recent US stock market decline was just that, a decline and not a crash. The American Fascist Party, err, Democrats, have strangled the US economy with regulations, but it's a slow asphyxiation, not an ISIS-style beheading. We're not in crisis, we're just stagnating.

Despite what people like me say about President Obama and the wild predictions we make, the world hasn't come to an end.

And yet...

I'm still betting on Japan to be the crisis point of the decade. They continue to find ways to wriggle off the hook and live a few more months, but their doom is out there, circling like a shark in the form of mountains and mountains of debt.

Me, I'm doomed, too. Doomed to mix metaphors. Fishing, sharks, mountains. Oh yeah. Those went together real well.

One year in the Nikkei. Look at it wriggle off the mountains and avoid the fishing sharks!

Monday, October 20, 2014

How Central Banks Printing Money Turns Into Stock Bubbles

From Bloomberg:
Japan’s $1.2 trillion Government Pension Investment Fund will increase its allocation target for local shares to about 25 percent from 12 percent, the Nikkei newspaper reported without attribution. GPIF will also boost its holdings of foreign bonds and stocks to about a combined 30 percent from 23 percent, while reducing domestic debt to the 40 percent level from 60 percent, the Nikkei said Oct. 18.
  1. The Bank of Japan (BoJ) prints money. 
  2. It uses the money to buy government bonds (domestic debt, above). 
  3. The Government Pension Investment Fund sells its government bonds to the BoJ.
  4. The Government Pension Investment Fund uses that money to buy Japanese stocks. 
  5. Stock prices rise and everyone feels wealthier. 
  6. Yay!
Printed money has become real wealth. Well, it's real only so long as you can get yours out of the market and run away to some place where they don't print money out of thin air to inflate stock prices.

Is there such a place any more?

Saturday, October 18, 2014

Janet Yellin Visits Chicago's South Side

Janet Yellin, chairwoman of the Federal Reserve, recently visited the violent, disadvantaged, pathology-laced south side of Chicago. After spending quite a bit of time with the residents, discovering just why economic mobility is so difficult for them, she released a statement and a video.

Here's the statement:
“The extent and continuing increase in inequality in the United States greatly concern me,” Ms. Yellen said to a conference on economic opportunity and inequality sponsored by the Federal Reserve Bank of Boston. “I think it is appropriate to ask whether this trend is compatible with values rooted in our nation’s history, among them the high value Americans have traditionally placed on equality of opportunity.”
Here's the video:

I mean, I think that was her shooting the video. She's a Really Smart Person. She went to Yale and Brown, both Ivy League universities. I can't imagine she'd make firm pronouncements about the underclass from inside of a government-academic bubble.

Would she?

Update: OK, I'm sold. Janet Yellin had to be the one shooting that video. Another Really Smart Person who went to an Ivy League School had this to say (emphasis mine):
“I think she broke new ground in terms of a Fed chair looking at such a serious socioeconomic issue with that degree of rigor,” said Karim Basta, chief economist at III Associates, an investment adviser, who attended the conference.

Friday, October 17, 2014

Ebola Is About Race

... because everything is about race.

Up to now, I've not been able to figure out why we don't have a travel ban on flights from infected countries and why we're not taking steps to close our borders. While it won't stop the spread, it will certainly slow it down. I'd rather fight the disease inside the country with 5-10 initial cases than 500-1,000.

Peggy Noonan today shows what gobbledygook the Administration response is to questions about travel bans. It's clearly lies, but why? Up to now, I'd thought it was the traditional Democrat fetishization of race. Africans are black and any restrictions on blacks is racist. A travel ban is racist and therefore religious apostasy to the Administration.

Jonathon Last disabused me of this notion. It is indeed about race, but, being more precise, it's about racial politics.
Marine Corps General John F. Kelly talked about Ebola at the National Defense University two weeks ago and mused about what would happen if Ebola reached Haiti or Central America, which have relatively easy access to America. “If it breaks out, it’s literally ‘Katie bar the door,’ and there will be mass migration into the United States,” Kelly said. “They will run away from Ebola, or if they suspect they are infected, they will try to get to the United States for treatment.” ...

Ebola has the potential to reshuffle American attitudes to immigration. If you agree to seal the borders to mitigate the risks from Ebola, you’re implicitly rejecting the “open borders” mindset and admitting that there are cases in which government has a duty to protect citizens from outsiders. Some people on the left admit to seeing this as the thin end of the wedge. Writing in the New Yorker, Michael Specter lamented, “Several politicians, like Governor Bobby Jindal, of Louisiana, have turned the epidemic into fodder for their campaign to halt immigration.” And that sort of thing just can’t be allowed.

What would happen in the event of an Ebola outbreak in Latin America? Then America would have to worry about masses of uninfected immigrants surging across the border—not to mention carriers of the virus. And if we had decided it was okay to cut off flights from West Africa, would we decide it was okay to try to seal the Southern border too? You can see how the entire immigration project might start to come apart.
And there you have it. If Democrat leaders become pro-border-security, the party loses its key wedge issue with Hispanics. Since the Democrats live and die with racial-block voting, they can't give up this issue. If Hispanics ever divided their votes 50-50 between Republicans and Democrats, the progressive era would be over, o-v-e-r.

On the plus side, an Ebola outbreak would make it easier for the Democrats to vote the graveyard.

Thursday, October 16, 2014

Link Of The Day

... comes from the level-headed Calafia Beach Pundit. Here's a tidbit.
Might I suggest that if indeed the world population were to collapse in short order, most of those who managed to survive would face bleak prospects at best; the machinery of the global economy would be effectively broken, and modern civilizations would be hard-pressed to survive. What good would it do to sell everything you own today? Investing in anticipation of the "end of the world as we know it" is a questionable exercise at best. If you are convinced we are faced with an inevitable global catastrophe, then buying plenty of guns, ammunition, food, and a private, isolated island is probably your best strategy.
Read the whole thing.

I've pondered taking some of my S&P 500 money off the table and move it into safe bonds, but I think the time for that has come and gone. I wanted to pull the trigger at 2000, but I didn't. I can't imagine there will be too much more downside before the Fed contracts fiscal Ebola and begins to spray money out every orifice to stop whatever business cycle is causing them to wet their pants.

If things get too dire in the market, the Fed will save us from ourselves by manufacturing money out of thin air. Well, it will hand out free money until it can't do that any more because printed money has no value, but that looks like it's a ways off.

Wednesday, October 15, 2014

Infantry Against Ebola?

One more thought on Ebola. For the life of me, I can't figure out why we sent Army soldiers to Africa to do something about Ebola. It seems to me that they're just going to become disease vectors. Allegedly they're there to set up testing and treatment labs.
Eventually, up to 4,000 military personnel are expected to be deployed to West African countries battling the Ebola outbreak
It seems like a force that size will be devoured by both the country and the virus.

Do we keep them in quarantine before we let them back in the country?