Monday, May 31, 2010

The Fight for Freedom Becomes An Every Day Job

I guess I just never expected we would have to battle our government every day of our lives. 

How about how the ATF suddenly, by stroke of the acting director's pen, changed 40 years of law to make it a Transfer to move a gun around a store.  Really?  Why?  Why now?  To quote Codrea's excellent piece:

I know the perceived intent here involves shipping guns to contractors, evaluators and the like, but if I just read these words on their own as written, I can see it being interpreted that such transfers could even include renting guns at shooting ranges.  I find the timing curious, because the antis have recently begun referring to this as a "federal loophole" and using anecdotes to stir up the hysteria to close it.
It's a "federal loophole" for a gun maker to send a copy to a laboratory to measure its performance?  Really?  Even if the ruling was to make it harder for the gun companies to send an evaluation sample to a magazine or TV show for review, why?  There are no records of any crime being caused this way.  Note that this is a regulatory nudge, Cass Sunstein's favorite term, that never went in front of Congress.  No way to write your representative or senator to try and head it off. (Hat Tip to Dave Codrea)

How did Clinton aide Paul Begala put it?  "Stroke of the pen, law of the land. Kinda cool!"
If you're not a "gun person" you may not know there is no such thing as "gun show loophole".  The same laws exist for sales at a gun show as anywhere else.  In fact, they can be more restrictive.  Mrs. Graybeard and I spent the afternoon at a gun show in West Palm Beach yesterday, and while I can buy any gun from anyone in my home county in a private sale by just plunking down an agreed upon price, at yesterday's gun show attendees needed to find an FFL, do a full transfer and wait 5 days.  There is an exception for state concealed carry licensees, as there should be, but they've made it harder to buy a gun at a show than when there isn't a show.  Stupid.  Criminals get guns by stealing them, not from gun shows.  How would they like a 5 day cooling off period and a Federal licensee to siphon $50 off every political contribution? 

How about a takeover of the financial industry?  Put together with health care, the big 3 automakers, and all the rest, I've heard from various sources that we're looking at 60% of the economy being in the government's control.  All your financial data are belong to us.  There will no longer such a thing as a private life.  May I add that every market follower I can find who has read the law says it will have no effect on the piracy that caused our financial mess, and will probably help the bad guys?  You knew that already? 

How about our abandonment of the fight against Islamofascism?  Deputy National Security Adviser John Brennan is a man who refers to Jerusalem by its Arabic name, Al-Quds, and who peppered a speech recently with a minute of Arabic. I don't have a problem with him speaking Arabic, I have a problem with how he runs his office.  With three attacks in a few months, we appear to be dropping the ball.
We've seen the enemy and it's not just the jihadists. It's also our own government, which refuses to see this very real enemy. How can we fight and defeat what we refuse to see?
Allowing the construction and dedication of an in-your-face mosque at ground zero on September 11?   As Gates of Vienna puts it, this is a new battle in a very old war.

We have essentially pre-surrendered in Afghanistan, by giving an "out-by" date.  If the enemy had any sense, they would lay low, and the peace would encourage us to leave earlier.  Once we're gone, it would take a completely different America to go back.  The way I see it, our current administration wouldn't go back into Afghanistan if a 9/11 level attack happened again, and it could be proven it came from there. 

How about securing the border?  Citizens shut down the capitol phone system a couple of years ago under GW Bush, when a repugnant amnesty bill almost floated.  Looking at the status of the southern border, it's hard not to conclude the has given up on enforcement.  The people, on the other hand, support stricter immigration controls by large measures.  The support in Arizona is so strong, it's hard to imagine a scenario that backs the "racism" card.

Need I go on?

The administration is attacking the people on every front.  It is requiring not just resistance, contacting our representatives and all of the usual things, it's getting to where citizens are going to need to split up the work: "I'll go fight my representative about gun things if you fight the financial takeovers".  The problem is that there are no lobbyists for us. 

Wasn't this supposed to be a government "of the people, by the people and for the people"? 

Sunday, May 30, 2010

A Day of Thanks and Remembering

On this day of remembrance, my thanks to the families of the fallen, of all generations. 

My father served in the Army during WWII, part of what we now call "The Greatest Generation".  All I really know are stories I heard as a kid, so these may be real facts, or they may be bad memories.  I was told he served as a tank driver in the 1st Army, "The Big Red 1", and I was told he was or would have been under George S. Patton's command.  I'm not sure those are compatible facts.  Dad was seriously injured in a stateside training accident and never deployed to the European theater.  Dad was in a lead or observer's tank, one with an open area where the turret goes in regular tanks.  The tank rolled, Dad was thrown out and broke several vertebrae in his lumbar spine.  He spent many months in a body cast in bed, and never returned to active duty.  I'm unsure of many of the details of this, as he rarely ever talked about it.   

Dad passed away of cancer almost 30 years ago.  

When I read the true stories of the acts of the people of that era - not just the fighters but also the families and the ways the country changed to pull off the amazing things we did - I am simply amazed and awed.  It was a time when ordinary people did extraordinary things.  For us.  For the world of today to even exist.  In so many ways it seems the modern US has let them down. 

I never served in the military, and while I never would have guessed these words would ever leave my lips (well, fingers) at the time, I really should have.  I think some of the training would be of use in the coming days.  I came of draft age during the Vietnam war, and due to the timing of events in the war and my age, the war was winding down.  I recall registering for the draft lottery and getting a high enough number that I thought I would never be called (and that was the case).  At that time, enlisting as a volunteer was not something people I knew talked about, and I never thought of it. During my senior year of high school, I recall taking some of those standardized tests, besides the SAT, and getting a pretty good score on one of them (NMSQT?).  As a result, I got a ton of letters from colleges asking me to consider coming to their schools.  Among those letters was one from West Point.  They, of course, could not guarantee admission (the process required being nominated by your congress critter or senator) but would "look favorably" upon an application.  It is rare in our lives for opportunity to knock quite so loudly.  And a shame for us to ignore the door.

Saturday, May 29, 2010

Drill, Baby, Drill

Yeah, that's what I said.  Keep drilling. I point out in my profile that I live in Florida, and my own favorite fishing spots, beaches and all are threatened by this disaster.  I still say "drill, baby, drill". 

This week, the Prez declared a moratorium on drilling new wells and a moratorium on simply exploring for new oil offshore.

This is like saying "I got food poisoning, so I'm never going to eat again".  I understand the sentiment, but it's stupid and ultimately suicidal.

Simple truth.  Like it our not, our world runs on oil.  Another simple truth: energy use is directly proportional to affluence.  The news meme that drives me crazy the most is probably the one that goes "the US is 5% of the world's population but uses 25% of the world's energy".  You don't need a Ph.D. in library science, or anything else for that matter, to use Google or Bing or your favorite search engine to see that it's because we produce about that percentage of the world's GDP.  What that meme really means is we have a tiny population for the massive amounts of wealth we produce.  It should be something to celebrate, something to shout from the mountaintops.  Instead, they've made it something to be embarrassed about. Even otherwise brilliant engineers I know have not seen this until I pointed it out.

Do I like oil spills?  Hell, no.  Seems weird to even have to say that.  Do I want to see any wildlife hurt, or lose my favorite surf fishing spot?  Double hell no.  I feel terribly sorry for the families of the 11 who died on the rig, and the people whose lives will be disrupted by having their jobs destroyed; fisherman, guides and so on.  You just can not remove all risk from life.  Obvious science: any energy source has more energy than its surroundings or it wouldn't be much of an energy source.  That means getting it and using it is going to risky.  That means if the greens ever discover the magical unicorn farts they're searching for to replace oil and power everything, unicorn farts will be risky, too. 

Personally, I would rather see us using much more nuclear power.  I know they must exist, but I have personally never met an engineer who didn't want more nuclear power.  The technologies to build reactors that won't  melt down has been around for about a quarter century, now, so that whole "China Syndrome" argument is out the window.  The technologies to safely handle nuclear waste have been around even longer, over half a century.  The only arguments against it are political and NIMBY.  Nuclear is great for infrastructure and electricity, but for portable sources (cars, buses, other personal transport), some sort of fuel like gasoline, natural gas, or possibly hydrogen looks to be needed for a while, yet. 

Since the greenies have almost completely shut down nuclear energy in this country, and have relegated us to the most inefficient and expensive alternative energy sources (wind, corn ethanol) we are stuck with oil. 

Another energy source with great potential would be to produce giant arrays of solar cells in earth orbit and beam the energy down as microwave power.  The energy density can be reduced in the beam to allow birds and aircraft to go through the beam safely, but would require many acres on the ground to collect the energy and large battery banks for storage.  Neither acre-sized solar collectors or large amounts of storage batteries seems to be acceptable to the greenies. 

If we could get rid of the stupid regulations, we could have a cafeteria selection of energy sources choosing the most cost effective answer to the problem we need to solve.

For now, the environmentalists have painted us into a corner.  We either keep drilling or slowly die.  I say, "drill, baby, drill".

Thursday, May 27, 2010

I Love the Hurricane Season Forecasts

NOAA came out today with our hurricane season forecast:  NOAA Expects Busy Atlantic Hurricane Season.

They have a few standard forecasts.  "More active than normal", "Extremely active", and "OMG!! Head for Atlanta!!"

Seriously, as one of the young engineers I mentor says, "This is the best job in the world.  You come out once a year and say how bad it's going to be and there are never any consequences!  No one ever gets fired for being wrong, no one ever gets ridiculed in the press.  It's the ideal job." 

Put on your big boy pants, I have some truth for you.  Forget what the Global Warming Believers say about these storms; there is no evidence of link between warmer temperatures and storm number or intensity, hurricane energy is actually declining over the last half century .  Hurricane activity goes in cycles, roughly 40 years long.  We are in the high activity side for the North Atlantic.  I think we went into it during the mid to late 90s.  By rough estimate, we'll have higher than normal numbers of storms for as much as another 10 years, all other things being equal.  And all other things are never equal.  2004 was the 6 sigma season here, we had direct hits from two cat 3 hurricanes in the same month, plus a few that passed close enough to give us tropical storm winds.  It has never happened in history and will probably never happen again.  We have not had a direct hit from a hurricane since then.  Last year we had a very strong el Nino start up, which tends to shear the tops off storms and keep them away from us.  That seems to be ending, so if I was them, I'd be forecasting a busier year than last year, too.  

To paraphrase Tam from a few weeks ago, "if you're prepared for the zombie apocalypse, a little thing like a few days of rain and no power doesn't mean much".

Wednesday, May 26, 2010

Words I Never Thought I'd Say

The Dalai Lama is an asshole.

Look - the guy is from Tibet. He has personally seen the Chicoms killing Tibetans.  He has seen it up close.  How can he possibly say "(Marxism has) moral ethics, whereas capitalism is only how to make profits,"??  Are the 70+ million that Mao executed somehow better off because they were killed by Marxists? 

Communism has killed more people than any form of government in history.  Compared to Mao, Hitler was an incompetent poseur.  

Big governments are always the problem, because no organization can kill in the kinds of numbers governments can.  Of the government killing over the course of history, communism is the champion mass murderer.  Small minded people object to "the rich" or cry about the "maldistribution of wealth", but the pettiest local government official has more impact on the quality of your life than the richest men in the world. 

Tuesday, May 25, 2010

What Do You Do When It Goes Over The Line??

Many people have written about the organized thuggery carried out by SEIU goons last week, when they bussed in protesters to a banker's house.  There are reports that the thugs were escorted by police, or at a minimum, the police were not willing to do anything. 

Nina Easton's article on CNN's website has a lot of the relevant facts.  The banker whose home was attacked had been at his child's baseball game.  Another, older, child was at home terrified and had locked himself in the bathroom.  Picture yourself in this situation; your child is home afraid and needs to be protected.  You're with a child that you just can't leave to fend for himself either, what do you do?  You don't have backup.  You aren't  a professional security guy or special forces operator.  You're a dad with two scared kids, and you're probably pretty scared yourself. 

Dad parked some distance away, left the younger kid in the car and managed to force his way into the house.  Got older kid and escaped.  All was well.  Being rent-a-mob union protesters, they're probably just "paid by the hour" and just going through the motions anyway.  Too lazy to get a real job. All's swell that ends swell. 

But what if?  What if it wasn't just rent-a-mob protesters?  After all, these are the same sorts of people who have blown up buildings, blown up radio towers, car dealers, and done real violence.  

I would have been uncomfortable leaving the little kid alone.  First off, I don't know that a thug won't attack him.  After all, they bit the finger tip off a guy at a town hall, hospitalized Ken Gladney, heck - they even intimidate other union groups and socialists - why should I assume they won't hurt my kid?  On a darker note, how do I know I'm going to survive to get back to the kid and get out of Dodge? 

I would probably take the young son with me, and do my best to sneak into my house from another side.  Back door?  Without knowing the layout of the property it's hard to say, but this guy went in through the front door.  Then I would make sure the kids were safe and prepare to repel invaders.  If no one breaks in a door or window, fine.  If they do, "the shotgun sings the song", as Pete Townsend wrote in "Won't Get Fooled Again". 

Look this is way over the line.  The fact that SEIU thinks this is just a dandy way to do business shows you what scumbag thugs they are.  If these keeps up, someone is going to get a load of 00 buckshot in the face.  Take my word: that will completely ruin their day.  As a people, we need to make it clear this is not an acceptable way to protest. Families are off limits.  No exceptions. 

Maybe the reason they do this in Maryland is that they're less likely to come across someone with self-defense capability.

Perhaps more interesting than why they do it in Maryland is why they protest the Bank of America at all?  Could it be they are deeply in debt to the bank, to the tune of over $156 Million at last report.  As Ms. Easton says,
A lifelong Democrat, Baer worked for the Clinton Treasury Department, and his wife, Shirley Sagawa, author of the book The American Way to Change and a former adviser to Hillary Clinton, is a prominent national service advocate.
In the 1990s, the Baers' former bosses, Bill and Hillary Clinton, denounced the "politics of personal destruction." Today politicians and their voters of all stripes grieve the ugly bitterness that permeates our policy debates. Now, with populist rage providing a useful cover, it appears we've crossed into a new era: The politics of personal intimidation. To top of page

Monday, May 24, 2010

America's Cultural War

I worked with a guy several years ago who said, "America's next civil war will be between the 'haves' and the 'have nots', when they are led to believe they have a right to everything the 'haves' worked all their lives for".  Hadn't thought of it until a month or so ago, but I think he was on to something.

"This is not the culture war of the 1990s. It is not a fight over guns, gays or abortion. Those old battles have been eclipsed by a new struggle between two competing visions of the country's future. In one, America will continue to be an exceptional nation organized around the principles of free enterprise -- limited government, a reliance on entrepreneurship and rewards determined by market forces. In the other, America will move toward European-style statism grounded in expanding bureaucracies, a managed economy and large-scale income redistribution. These visions are not reconcilable. We must choose."  (emphasis added)
An excellent piece by Arthur Brooks of the American Enterprise Institute.  Four pages but worth reading.

Put that quote together with this one from Western Rifle Shooters Association,

Do you understand that scores of millions of your fellow Americans ("Americans" at least by nation of residence, if not by individualist ethics) would tear you and yours into bloody chunks were you ever to attempt to reduce their "benefits"?

A few weeks ago, just before the April 19th Second Amendment March, when there was all sorts of media frenzy over tea parties, no less than Bill Clinton quoted Billy Beck's line, "All politics in this country now is just dress rehearsal for civil war."  I believe this is what he's referring to.

Sunday, May 23, 2010

The Texas School Book Selection

Earlier this week, I heard the Texas State Board of Education was choosing new textbooks.  One of the items the social studies people wanted to talk about was the role of hip hop in American culture.

I can answer that.  It's a fad.  Hip Hop in 20 years will be like that lower back tattoo your young girl got on on a trip to Capo San Lucas.  Hip Hop will be like a meaningless tattoo that sags as you get older. 

So the answer isn't quite "no role" in American Culture.  It will worse than no role, it will be more like that tramp stamp you regret. 

Saturday, May 22, 2010

What’s All This Gold and Weiner Stuff, Anyway?

This past week, Congressman Anthony Weiner (D – Wolf 359) started a campaign against Glenn Beck and Goldline, a company that sells gold coins and bullion. Beck has responded by (1) making fun of his name and (2) posting real facts from good sources that contradict Weiner. Perhaps the most stupid argument was that you shouldn’t buy from Goldline, just buy the gold ETF, ticker symbol GLD. I subscribe to Beck’s website, originally because I found him funny, but really have no dog in this fight. I am not a customer of Goldline, and I fund this blog entirely anyway (notice there are no ads?) as long as my day job holds. The arguments against Goldline are easy to refute and irrelevant, largely just a harassment tactic (get your “enemy” off message, off balance and out of their comfort zone). What I want to talk about is gold, economics and investing.

As mature adults, we are beyond making fun of the name “weiner”.Heh heh, heh heh. He said "weiner".

In the summer of 2000, Mrs. Graybeard and I took a course in lost wax casting - the process by which most jewelry and many small, fine-detailed mechanical parts, are made. We cast several pieces in silver and for my final project, I wanted to work in gold. I noticed gold was around $250/oz., and that seemed cheap. I didn't follow the price of gold, but remembered prices in the $700 - $800 range in the early '80s. As it turns out, that $250/oz was just about the dead bottom of a multi-year bear market in gold.

Why is gold around $1200/oz now when it was $250/oz in the summer of Y2K? Why is oil high when demand is low from the big consumers? Is it those "ebil, debil speculators?" From watching the cable TV channels talk about stocks and other investment vehicles, and from other observations, I'm convinced most people - even people who advise on stock and other financial instruments - don't understand inflation.Most people don't even really understand our financial system.

Around that time in Y2K, it was occurring to me that my 401k had not grown as fast as I'd like and maybe I should do more than just follow the standard recommendations. So I started reading about gold along with other investment opportunities. Remember, this is late 2000; the tech bubble had just burst. I lost money in that like everyone. The real estate bubble had not started. I found that in the '70s it was standard advice to have about 20 to 30% of your IRA in gold as a safe haven, "just in case". As my research moved on, I started to read the commentators on

 I quickly encountered a group of people called "gold bugs" who seemed like a lunatic fringe.  They vocally say "gold is money" and "all fiat currencies (like the dollar) eventually collapse", "inflation is going to get worse" and so on.  I thought they were lunatics.  I was more interested in the technical analysts who pointed out demand was getting ahead of supply for gold and the time needed to get a mine deposit found, developed, and producing gold (about 10 years) means that the demand will exceed supply for a long time.  Can you say increasing prices?  So I found some ways to include gold in my retirement plans, and have happily watched it do well as everything else is having troubles.

Then a funny thing happened.  Some of the "lunatic" gold bugs' predictions started coming true.  About 2005 (I think), I started reading predictions of problems related to something called "sub-prime mortgages" that I had never heard of, and they warned that it had the potential to take down the entire world's economy.

For you people who still think this just isn't mainstream enough for you, would you listen to Robert Kiyosaki, whose "Rich Dad/Poor Dad" series has become a wealth building franchise and a staple of fund-raising events on Public Television?  One of his guys has a book called, "Guide to Investing in Gold and Silver".

If that's too staid, the "Angriest Guy in Economics", the Mogambo Guru, might be more your speed.  A little tough to "get" the first time I read him, I eventually thought if you took a classic Robin Williams full-tilt-bozo comedy bit from the late 70s and made it about economics, it might sound like the Mogambo.

In the 70's, a guy named Howard Ruff wrote a book on how to survive the inflation  of that decade.  He's still around, and following one little piece of advice from his book has made me thousands.

Inflation is always a result of monetary policy.  Always.  How does inflation occur?

Imagine you had a printer that could make perfect copies of any dollar denomination you wanted.  Because it's technically, you know, highly illegal to do this, you want to be disciplined about how you use it and reserve it for emergencies.  You need to buy a car and get into a bidding war at an auction.  You win because you can always pay a higher bid, just by printing a little more money, and you always get away with it.  Can you imagine that after a while, you would use this power more often?  Now imagine everyone had such a printer.  Can you imagine that the prices of everything would be bid up by the larger supply of dollars?  This is the essence of price inflation: an increase in the number of dollars available to bid pushes up price. 

And that's what the Federal Reserve is doing.  By flooding the markets with "liquidity", they really mean currency.  They used to release data on the size of the money supply, but stopped some years ago.  I assume it was because they thought it was too scary for us hicks to look at.  Too much negative feedback from economics writers.  Ben Bernanke, who was just a member of the Federal Reserve board at the time, famously said (in response to questions about deflation, in 2002), "The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost,"  What would you think if you had a big pile of dollars, like OPEC or China or the various countries that we buy from?  You would think, "If there's much more of them, mine will be worth much less; I'd better store my wealth in something else".  Exactly that happened, and the price of gold spiked immediately after his statement.  The image of the Federal Reserve dumping baskets of currency out of a helicopter was coined by economist Milton Friedman.  Bernanke's remark about the printing press earned him the nickname "Helicopter Ben" (don't remember where I stole this picture - if it's yours and you don't want me to use it, just comment).

Bernanke also said, "people know that inflation erodes the real value of the government's debt and, therefore, that it is in the interest of the government to create some inflation."   Maybe, but it's not in the population's interest.  The problem is that if you're a saver, your money is going to be devalued by that inflation.  If you are living on a retirement pension, social security or some other similar benefit, you are screwed.  The government horribly understates the cost of living because they don't include food or energy costs.  Your social security cost of living adjustment will never keep up with the real cost of living.   

And that's largely why oil is expensive today, despite low demand.  Oil costs more dollars because each dollar is worth less.  Thinking oil seems very expensive is like everyone on the Titanic thinking the water seems awfully high, not that they're sinking.  Think the stock market is doing well - or was?  Have you seen the DJIA or S&P 500 corrected for inflation?  Corrected for inflation, you are loaning companies money for about 1.6% per year return.  Some periods are less, others are more.  The $1200/oz price of gold includes inflation and increased demand due to the widespread concern that the worldwide currency system is failing.

We call our dollar a fiat currency because it's worth is declared by fiat.  It's worth exactly what someone is willing to give you in exchange for one.  We do not promise any amount of gold, silver, wheat, rice, pebbles or manure in exchange for one.  Inherently, it's only worth the paper and ink used to make it. 

Money is different from currency: currency is the paper and base metal coins you have in your pockets while money is something that has value and is used as a medium of exchange.  For much of history, money was gold or silver.  People on Yap Island used large stone rings.  Paper money was invented as a way around carrying large amounts of coins.  I've heard it argued that there is nothing special about gold or silver and that's true.  They are simply something that has a universal history as valuable.  People want them.  You could theoretically have a fiat dollar like we do and have it be stable.  It requires politicians, bankers and everyone involved to be honest, and responsible.  It requires politicians not create vast amounts of currency so they can deficit spend, go to war, hand out food, healthcare or any of the other things governments do with this made-up money.  In other words, fiat currency will never work in the long term. 

The basis of money only has to be agreed upon, relatively portable, and dividable (diamonds are out: you can't cut one to give change).  Gold and silver fit the bill.  If the fiat currency system collapses, they will be accepted.  There will be barter and other primitive ways of dealing with each other.  Realize that if there is widespread collapse, your gold ETF will be an abstract, almost worthless thing.  If there is enough gold to fill all their orders, you will still need a functioning world to get it out.  If you buy coins or bullion, you don't have that concern. 

The world currency system collapsing?  There are writers who think we are seeing the death throes of fiat currency.  Historical writers are fond of pointing out that fiat currencies always collapse because politicians and bankers just can't resist screwing with them.  It might also be the death throes of Keynesian economics that essentially asserts governments should spend more when they're out of money (in a depression, tax revenues are down just when Keynes says we should spend more).  While that will be painful, it might be like getting an antibiotic shot for a bad infection: pain now for complete cure in the long run.

Friday, May 21, 2010

Which One is Right?

Here we have two very different points of view on Greece, the Euro, the Dollar and everything.

On the positive side a commentator I know nothing about and have no sense of track record with, Ken Gerbino.

On the negative side, the tremendously gifted writer, Mark Steyn.

Which one is right?  One of my favorite quotes is from physicist Nils Bohr, who said, "Prediction is very difficult, especially about the future".

And where is the US stock market going?  Excellent market Technical Analysis from John Galt at Shenandoah. 

Part 1.    Part 2.  

More on economics 101, inflation, gold and all that later.

Monday, May 17, 2010

The 401k Takeover Lawmaking Proceeds

I have written about this a before, here and need to talk about it some more.

The point in my prior article is that "what can't go on won't go on" and "things that have to happen will happen".  Nothing has changed.  We still need to sell absurd amounts of bonds and can't go on the way we are.  Our customers are less interested in our bonds.  Although almost never reported on in the US, China's Shanghai stock market is in deep correction, almost a bubble burst.  Higher interest rates might get bond buyers back, but will be a death blow to our economy.  The alternative to monetizing our debt is to selling them to someone, but whom?  Enter the 401k. 

Shanghai composite index.  Technical analysis by

The latest information is that the rule-making process is proceeding normally.  Reports on the total amount of money in 401k accounts vary, but it's in the vicinity of 5 trillion dollars.  My bet is that is an absolutely irresistible pile of money to the current administration.  In this article, one of my first, I wrote:
The stock market crash of ’08, with the concomitant collapse of many 401k plans, has given the .gov an excuse. There is talk of nationalizing our 401k plans – in not so few words – so that we can replace those “risky” plans with a gubmint guaranteed (but teeny tiny) yield. See, for example, this piece on Market Ticker There's a good reason to think this is coming; our unsustainable debt has to be financed by selling bonds. Now that the sales of bonds are failing internationally, the .gov can sell them by forcing them into our 401k accounts!

I am not emptying my 401k .... yet.  I am watching the process as best as I can. 

You should, too. 

Sunday, May 16, 2010

Who I Am - What I Believe

A lot of bloggers have posted a kind of position paper: who they are and what they believe in.  I haven't and it's time to do it.  It's hard to figure out a good order for list like this, so I'm just going to dive in but try to keep it organized.  I'm going to start with one that you might not think intuitive, if you've read much here. 

I don't think I'm too much of a pessimist or too much of an optimist.  I prefer to be a realist and see things as they are.  I think that being an engineer tends to make you a realist, and "well-grounded".   It is our job to put reality to our service, to herd electrons in the desired direction and get them to work for us.  That circuit I'm working on doesn't care whether I'm optimistic about it or not, it doesn't care whether I like it or not, and it doesn't care if my computer model is elegant and pretty.   It's going to obey the laws of physics and do what they demand it does.  The world political system, most certainly, doesn't care what I think.  I simply try to see the paths things are following and extrapolate off the end of the trajectory. 

I believe in science.  I believe that science, as an organized, self-correcting set of investigations into how the world works is among the most important things humanity has accomplished.  I believe that as long as that self-correcting process is not hindered (the cardinal sin in those CRU emails), it will right itself.  I believe the Voyager satellite program might well be the crowning achievement of mankind.

I believe in Christ.  I used to be a deist, believing that God wrote the laws of physics, started the grand machine of the universe in motion, and then took off to watch from a distance.  If your science is good, you don't need a God involved in everyday things, but there are places science has incomplete/incorrect knowledge - a concept that I think is known as "God of the gaps".  The Greeks, for example, needed Apollo to drive his chariot containing the Sun across the sky every day.  We simply need to understand the sun is a long distance from us, and our motion causes the things we see - we don't need a god involved at every sunrise.  But if you read the Bible in any of the modern translations, the argument for a personal, involved God is overwhelming.  Are there contradictions in my thought processes?  Is it an artifact of our translations?  Quite possibly.  Doesn't bother me a bit.  When I'm done on this side and I get to learn the real answers, I'll understand better.

My first iteration of college was in biology and chemistry, so I am therefore a "classically trained evolutionist".  I don't accept Darwinism as an explanation for the origin of life anymore; there are simply too many things I can't reconcile.  The complexity of the systems around us doesn't appear to allow for the slow, gradual evolution of Darwinism - too many enzyme pathways would be fatal in some intermediate stage so these complex pathways had to spring up complete.  There are countless examples being discussed.  To say Darwinism has been falsified is not to immediately say special creation has been confirmed, and it does not eliminate a role for Darwinism in natural selection and development of species.  But I think creation must be considered, even if evolutionists are uncomfortable with it. 

I believe the old saying, "the biggest reason people choose to become Christian is that they know a Christian: the biggest reason people don't choose to become Christian is that they know a Christian".  I strive to be the right man in that comparison. 

I believe in personal freedom, liberty and responsibility.  This is the core Christian biblical value; you are responsible for yourself.  I accept the challenge of being responsible for myself and my family, providing for us, defending us, taking care of us as best I can, with the help of God.  Because I believe in personal freedom, I believe that welfare and other government handout programs hurt people more than they help.  As a short term help in an emergency, sure.  I am a dedicated giver to many, many charities.  But making people dependent on the state saps their humanity - presumably to buy their votes. 

Since there is no greater destroyer of liberty than a large intrusive government, I am adamantly opposed to state-ism of any kind: communism, socialism, fascism, environmentalism, you-name-it-ism.  In today's lexicon, I am a small government conservative/libertarian.  I find Republicans share my values most often so I tend to back them, but I am not reflexively Republican.  I'm just as adamantly anti-Republican if they are big government fans (Charlie Crist here in Florida, Lindsey Graham, Arlen Specter - to name a few).  I don't know that any small government Democrats exist any more.  

I am not advocating anarchy.  I believe in a minimal government, much closer to our constitutional founding than the leviathan that now chokes off the private sector.  I do not believe government, like man, is "perfectable", so it must be minimized.  As Washington so eloquently said, "Government is not reason, it is not eloquence, it is force; like fire, a troublesome servant and a fearful master. Never for a moment should it be left to irresponsible action." I believe we could throw out the vast majority of the Code of Federal Regulations - perhaps 90% - and improve the lives of American's tremendously.

"If you put the federal government in charge of the Sahara Desert, in five years there'd be a shortage of sand." - Milton Friedman 

"The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries." - Winston Churchill.   

I believe that free market capitalism and its reliance on the enlightened self-interest of individuals is the most potent force for the advancement of humanity ever developed.  More people have been lifted out of crushing poverty in the last couple of decades, by the adoption of market principles in China and India, than have lived so far in history.  I can not imagine how an educated person can embrace socialism or communism or any variant.  Further, I believe the market is so powerful that it continued to advance the US, despite the fact that we haven't had a free market in nearly a hundred years.

I believe the "war on poverty" is motivated by the search for a statistical distribution that doesn't have a bottom 20%.  There is only one way possible: where everyone has exactly the same portion: nothing.  The same motivation insists on giving every kid a trophy.  It's great to do your best; it's better to win, and there's usually only one winner.  Get used to not winning.  Happens to everyone, even the very best.  We are not guaranteed the results of life, liberty and happiness; we are guaranteed the right to pursue them equally. 

I believe Thomas Jefferson was right when he said "If Americans ever allow banks to control the issue of their currency, first by inflation and then by deflation, the banks will deprive the people of all property until their children will wake up homeless".   I believe that almost all of the economic disruptions in the last 100 years, including the current mess, were caused by the central banks charged with preventing such disruptions. 

I believe the anti-gun groups like the Brady Bunch and Mayor Bloomberg's MAIG (I will not give them a link) are at best useful idiot lapdogs to tyrants; at worst, they are willing accomplices.  (This puts NYC Mayor Bloomberg, budding tyrant that he is, in the unique position of being a dog on his own lap!)  In the 20th century alone, governments killed almost 200 million of their own citizens, after thoroughly disarming them.  Yet a determined group of Jews in the Warsaw ghetto, armed with a handful of rifles and a few rounds of ammunition per person held off the Nazi army until their ammo ran out.  The gun is civilization.  The statistics are so overwhelming that I am amazed any educated person can act like gun control is a good idea.  Gun control laws only affect honest people who follow laws. 

I believe environmentalism is a religion, complete with myths comparable to many organized religions.  As I said; I majored in Biology at one time so I have taken college Ecology.  Ecology is a dynamic science.  Basing all of your actions on keeping things the way they were in some prior, "sinless state", which is what modern environmentalism is about, is not science.  Environmentalists are simply angry bigots who think the world was perfect in some previous state and want it to stay that way forever. 

I believe endemic racism is gone in America, although some small percent of people will undoubtedly be racist, just as some small percentage believes we never went to the moon and there are alien bodies in Area 51.  I believe the vast majority of claims of racism are just the product of a racism industry that lives off these claims.  I grew up in a time when there were separate water fountains for the "colored" people (and drank out of them anyway).  Today, a mixed race couple doesn't even merit a raised eyebrow or second glance in this small, southern town I call home. You can't convince me things aren't orders of magnitude better.

I believe that if you think abortion is just fine, that's between you and God, and anyone who would shoot an abortion provider is no less a killer than they perceive the doctor to be.  But I think you owe it to yourself to understand the roots of abortion lie in racism and eugenics.  You need to read about Margaret Sanger and the other death advocates behind the cause - they were actually the inspiration for Hitler's death camps.  That is, you need to read about her if you believe in being honest with yourself. 

I believe one of the most profound things in human experience is mathematics.  Math is based on two assumptions: that the number 1 exists, and that addition exists so that 1+1 = 2.  Given that, everything else is derived and proven.  So why is it that this entirely human-derived set of laws and equations describes the world so perfectly?  Why is that we can create so many intricate mathematical models of so many things in the real world, and have the models work so well?  God must be a mathematician. 

Because of my fondness for math, I am puzzled that a society can claim to put high values on literacy, and conduct public education systems to ensure adults can read, but the same society does little to encourage facility with mathematics.  I can't understand a culture that can accept adults who read at high school level but can't work fractions.  Perhaps it's because lawyers run the show, and they are afraid the ability to do the math undermines so many of their lies.  Can't have the proletariat thinking for themselves, can we? 

I believe our society has an unhealthy infatuation with youth.  To borrow a quote from Al Gore to students, "you know things your parents don't" - but those things are useless.  They know things like who's on which TV show, or what the latest trends are.  The things they know that their parents don't know are meaningless bits of fluff.  Kids, wear the goofy hair now - get it out of your system.  Soon enough, it will be time to go to work.

Friday, May 14, 2010

You Don't Have a Right To Choose What You Want to Eat

The Federal leviathan in court in Iowa has argued we citizens '... do not have a fundamental right to obtain any food they wish'

"There is no 'deeply rooted' historical tradition of unfettered access to foods of all kinds," states the document signed by U.S. Attorney Stephanie Rose, assistant Martha Fagg and Roger Gural, trial attorney for the U.S. Department of Justice.

If you ever had any doubt that we are heading into a period of tyranny that will rank right there with the Soviet Union, Mussolini's Italy or other such "paradises", this should just about destroy that doubt.

This is related to a frightening piece of legislation that has been languishing since last year, another Food Safety Act.  Since large factory farms have had some contamination issues, you'd think the Feds would target the foreign food imports, the large factory spinach farm located next to the pig farm (remember the e. coli in spinach?) , or someplace like that right?  Silly person!  The is going to clamp down on mom and pop farms, organic farms, and folks who sell the fruit off their trees on roadside stands.   Just like the toy safety act I talked about two months ago, the big companies can afford the lab tests and all the other process (well, they pass on the costs to you); the small farm can't possibly.  The way the law was worded in 2009 made having a lemonade stand, or selling things you grow in your own garden, illegal without absurd fees. 

If there's any food you like that is high in salt, fat or other things they plan to regulate, you should stock up now.

Tuesday, May 11, 2010

Congratulations! You Are Buying Part of Greece!

If you're an American citizen, congratulations.  As the principal funding nation of the International Monetary Fund, we are paying roughly 17% of the 1 trillion Euro bailout package for Greece.  In return, we get some Greek paper.  I think they use it for currency. 

And you thought it was bad to bail out AIG!  That's OK - AIG is using that bailout money we paid them to sell CDOs on Greek debt - betting Greece will collapse.  So when they do collapse, AIG will make money from it!  The market has pretty much decided this isn't going to work and started betting the Euro will collapse.  It's also a factor in the run up of gold prices, currently about $1230/oz. 

Last I heard, AIG wasn't throwing Molotov cocktails at the police, unlike the Greek union protesters.

This is a funny crisis because in some ways, it is complex, but looked at from another way it is incredibly simple.  Yes, there's a large number of things involved, but the root cause really comes down to one simple problem: too much spending, financed by too much borrowing.  So to fix this, the IMF is going to loan them more money.

Say what? They're going to fix a society that borrows too much money by loaning them more?  Isn't that like fixing an alcoholic by making them a nice, stiff drink? 

Oh, it's more than that, they'll say.  They're going to make the Greeks raise taxes and not retire quite as young.  The numbers I can find are a bit conflicted, but everyone seems to agree that the Greeks retire several years ahead of the Germans, say, who will be paying to keep Greece afloat.  That's only good and fair, isn't it, if you're a German citizen, to work longer so that you can pay for someone else's retirement? I guess we Americans get the privilege of working longer to pay for someone else's retirement, too.  When German citizens objected to working longer so that their Greek counterparts could retire younger than they do, the Greeks shot back that the Germans had not paid them damages for WWII - so there! 

It's really pretty obvious that people only have so much money.  Only the governments can print new money whenever they feel like it.  Every penny people spend on taxes can not go into buying other goods and services, causing an economic slowdown.  That will reduce the tax revenue as the number of people laid off and not paying taxes grows.  So they can't raise taxes too much or they'll kill tax income.  The only substantial change will be the workers who are expecting to retire will have to work longer. 

The risk here is that Greece pulls out of the EU, or the Germans do, or the European Union dissolves.  See, Greece is just first, why should Germany pay for all of them?  The German public is already rebelling against Angela Merkel.  It's not like everyone has a strong economy except Greece.  

Will this work?  Will the world stabilize?  I'm not betting my money on it.

Perfer et obdura; dolor hic tibi proderit olim - Be patient and tough; some day this pain will be useful to you. (Ovid)

Sunday, May 9, 2010

Not Dead Yet

Make not doubt about it - seriously bad times are coming.  These will be the new times to try men's souls.  The financial collapse of Greece will proceed; whether they collapse this week or next year matters not a whit - it simply affects the amount of time folks like us have to prepare and become more resilient; more self-sustaining.   After Greece, the EU might well collapse as an economic body.  The collapse of the dollar is absolutely a real possibility.  As Denninger said (my previous post),

There's a lesson in here in that the Greek deficit as a percentage of GDP is just over 10%. 
So is ours.
So is Britain's.
So is Spain's.
The destruction they are witnessing "over there" will come here eventually. 
 There is an essential difference between the US and EU, though.  Mark Steyn points it out at around 31 minutes into this video. 

Iceland, Greece and the EU formed movements to scream at Government, "Why didn't you do more for us?  How come you didn't protect us?"  Only in America was an entire political movement started to scream at Government, "Why don't you do less for us?  Why don't you get the hell out of our pockets?  Why don't you keep out of our lives, Big Government, and we'll do just fine".  That movement, of course, gave rise to the Tea Party, the 9-12 Project, the We Surround Them groups and more.

As long as real Americans think this way, we're not dead, yet. 

Friday, May 7, 2010

Imagine There Is Man Made Global Warming

Oh, no! (sniffle)(sniff)  Scientists decry the assault on climate science. (sniff) People are being mean to them... (sob) ... and saying mean things about all that fraud and stuff... and ....(sniff)  and not telling them they're important all the time... and people are being mean!!!

The problem with blogging is that I don't know you.  I don't know if anyone reads this - and that's compounded by the fact that it lives in perpetuity on a Google server somewhere, so that you could conceivably be reading this months after I post it.  Because of that, when I title a posting like this one, it's humorously ironic to some people (as intended) and others are going to spray spittle on their monitors and fume about stupid rednecks who don't believe in Global Warming. 

To begin with, scientific theories should not be "believed in"; they should be accepted.  Or rejected.  There is really very little room for belief in science.  Belief is, naturally, the province of things for which faith is required. 

When it comes to matters of science, I'm a hard ass.  I want hard science, I want rock solid data, I want confidence bounds, I want to know the value of p and I want error bars on your plots.  I want hard core data.  It's simple: put up or shut up.  Furthermore, I believe this is the only way for science to succeed.  Richard Feynman once noted, "science is about not fooling yourself, and you're the easiest one to fool".  Scientists are supposed to be skeptics; to always ask "is that the only explanation for the data" and do their best to kill off their baby theories.  If you're a member of the group that would hurl insults against anybody stupid enough to not believe the climate scientists, you are clearly not being skeptical  You're "believing" not "accepting". 

If you're a believer in anthropogenic global warming, you have to deal with the fact that the majority of weathermen, geologists and paleoclimatologists don't accept it.  The largest percentage of people who support AGW are the people who are directly supported by AGW grants.  This letter is signed by "255 members of the National Academy of Scientists"  When you look at the list of signers, they are not all climate scientists; many are MDs, biologists and other types of scientists.  If you are going to consider that sort of petition, then the Petition Project  has over 31,000 degreed scientists, including 9000 Ph.D.s - mostly in the physical sciences - who have signed a petition arguing against AGW. 

But, you have to understand this: science does not work this way - by voting 31,000 scientists against 255.  All of them may be wrong.  For science to progress, it is only necessary for one person to be right and for the scientific process to be unhindered.  The big problem with the climate modeling is that it ruins the real process of science and harms science in the long run.  Anything that harms science harms all of us.  The most damning thing in the CRU emails was the deliberate attacks on the peer review system; getting an editor fired, blocking papers from "outsiders".  This harms science.  Besides - if your case is strong, why would you do that?  You only do such things when you're committing fraud. 

Long before the CRU emails were leaked by that whistleblower, I was convinced that there was no useful science in AGW.  Simply compare the model temperature predictions for the last 20 years to what we've gotten.  AGW depends on a lot of very questionable assumptions, not to mention computer code that is laughable.  The simplest piece of software that goes into a life critical application, be it a car or a 747, has more rigorous software quality control done on it than the global climate models.  A car might cost a few thousand dollars and a couple of lives; a 747 costs millions and could cost hundreds of lives.  The global climate models will cost trillions of dollars and cost millions of lives, and yet there is no audit of them at all? 

The talk in the CRU emails about "Mann's trick" didn't faze me; nor did "hide the decline".  To me, Mann was discredited years ago by McIntyre and McKitrick - and has become pretty well self-discrediting.  McIntyre is a financial guy who was amazed that the climate modelers were not held to the same standards that his simplest financial programs were held to.  His web site is named for the idea that climate models that will cost trillions of dollars should be held to the same standards that a few thousand dollars worth of stock analysis will. 

The letter contains some horrible statements.  Take this one: 
When someone says that society should wait until scientists are absolutely certain before taking any action, it is the same as saying society should never take action. For a problem as potentially catastrophic as climate change, taking no action poses a dangerous risk for our planet.
This is clearly assuming that anything we do to counter warming has no costs or risks at all!  There is not a single reason on earth to think that there is no risk associated with the actions they advocate.  Any sane person would do some sort of risk-benefit analysis.  They follow that horribly sloppy thinking with this mess: 

For instance, there is compelling scientific evidence that our planet is about 4.5bn years old (the theory of the origin of Earth), that our universe was born from a single event about 14bn years ago (the Big Bang theory), and that today's organisms evolved from ones living in the past (the theory of evolution). Even as these are overwhelmingly accepted by the scientific community, fame still awaits anyone who could show these theories to be wrong. Climate change now falls into this category: there is compelling, comprehensive, and consistent objective evidence that humans are changing the climate in ways that threaten our societies and the ecosystems on which we depend.
 I think the advertising term for this is linkage.  They are trying to link the idea in your mind that man-made climate change is as well backed by evidence as the standard models of cosmology.  No, it's not; first off, there are literally thousands of cross-correlated measurements that support standard cosmology; and second, cosmology is based on theoretical physical modeling that is then compared to observation.  AGW is based on computer simulations that don't match reality very well at all.  The letter writers are also trying to equate anyone who disagrees with man-made climate change with those "Fundamentalist Christian Nut-jobs" who disagree with these theories.

The letter has no redeeming value.  It's a waste of time to read.

As Lord Monckton says, "we must get the science right, or we shall get the policy wrong."

Which brings me to the title point of this essay: in spite of the thousands of reasons to dismiss it, imagine there really was manmade global warming.  A set of reasonable questions seem to come up almost naturally: how big is the effect?  Is it bad?  Can we do anything to change it?  Should we try?  What would it cost?

In a pretty nifty piece of do-it-yourself science, World Climate Report determined the amount of CO2 required to raise the temperature of the globe 1C.  It takes ~14,138 million metric tons (mmt) of CO2 emissions to raise the atmospheric CO2 concentration by ~1 ppm and it takes ~125 ppm to raise the global
temperature ~1ºC. So multiplying ~14,138mmt/pmm by ~125ppm/ºC gives us ~1,767,250mmt/ºC.

That's our magic number-1,767,250 million metric tons of CO2 per ºC.  To the precision we know such things, that's more like 1.8 million mmt (million million million tons).

So let's say you wanted to reduce your carbon footprint.  Being a fanatic little greenie, you decide to give up your car.  According to some online sources, if you stopped driving your average mid-sized car for a year, you'd save about 5.5 metric tons (or 0.0000055 million metric tons, mmt) of CO2 emissions per year. Divide 0.0000055mmtCO2 by 1,767,250 mmt/ºC and you get 3.06 * 10^-12 degrees C (3.06e-12 in calculator jockey jargon).  If you took every car in the USA off the road, roughly 150 million, you've only changed the temperature .000458C per year. 

There has been talk about reducing the US CO2 output to 80% of its current levels - at one time that was in the Cap and Trade bill that has been in congress off and on for the last year.  The 2005 carbon output was about 6000 mmt, so 80% below that is 6000-4800 or 1200 mmt.  4800/1,800,000 is .0027C.  So if you took 150 million average mid-sized cars off the road and reduced the power generation and other carbon uses, those add up to a whopping .003C!  In other words, nothing.  In no statistical test could you distinguish that result from zero.  Bupkis. 

Now, the economic havoc of that sort of restriction set is unimaginably awful.  No cars, extremely limited electrical power, no ambulances, no police cruisers: a rural, agrarian lifestyle.  There is no benefit.  You are destroying the USA for no reason at all.  If you choose to live that way, help yourself.  Move out of the city, grow your own food, live on a farm.  Knock yourself out.  Most of us prefer modern civilization. 

If you watch Glenn Beck on the Fox News Channel, he has a video of a guy he calls "the Wizard", Joel Rogers, saying exactly what I just demonstrated here with a few calculations.  If you do all these things, it will have no measurable effect. At about 45 seconds into this video:!

And that's the dirty, stupid little secret.  Imagine there really is manmade global warming.  Use their numbers.  Calculate how much effect you would have on temperatures by virtually destroying everyone and everything you now know or ever have known, and it has no effect at all.

Saturday, May 1, 2010

Greece is Circling the Bowl - Who Goes Down With Them?

The day of reckoning gets closer.  Greece's economy is in shambles, their government backed bonds have been reduced to "junk" status, and "the people are revolting" (to borrow a line).  The IMF has asked the Greek government to reduce its deficit: cut spending and raise taxes. 

HT to Denninger

Two problems:

  1. Raising taxes means that private spending decreases.  It must, because every dollar that comes from the taxpayer to fund government has to come out of private consumption or investment.  It cannot be otherwise.

  2. The Greek labor unions have made clear they will not accept the current austerity measures (read: cutbacks in pay and benefits), say much less more of them.  We've already seen riots, which in point of fact are never that far away from a general conflagration, otherwise known as "civil war" (which is anything but civil.)
There's a lesson in here in that the Greek deficit as a percentage of GDP is just over 10%. 
So is ours.
So is Britain's.
So is Spain's.
The destruction they are witnessing "over there" will come here eventually. 

 Go read it, it's short.   

This is a time like no other I've ever come across.  I'll be the first to admit, I'm relatively new at reading any history, but the whole civilized world is in a bad economic mess.  It really comes down to handful of common reasons.  

  1)  You can't spend money you don't have forever.  Yes, you can incur some debt.  It's not a problem if it's at healthy levels, but when you half of what you make is going to pay the interest on the debt (US in a year or two), you will never pay it off.  You will go bankrupt. 

  2)  No nation has a currency backed in any tangible commodity.  The world went off the gold standard for good in the early 1970s, with every nation's currency floating with respect to every other.  What's a dollar worth?  Whatever any two parties agree it's worth. It's fine while everyone's happy and times are good; but what happens when everyone is on the verge of collapse?  Do they pull each other down or prop each other up?  The lack of a commodity standard has led to bubble after bubble after bubble - here and around the world.  The dollar is down to a few percent of its value from the 1930s when we started getting off the gold standard.  

  3)  There is an appalling lack of understanding of basic math and economics in the world at large.  People that can vote, tend to vote in those who promise them money or who start unsustainable financial systems.  The rioting socialists in Greece are a shining example.  "A government that robs Peter to pay Paul, can always count on the support of Paul" -George Bernard Shaw    

4) With the great interconnectedness of our financial systems, troubles in one area can multiply across the world faster than ever.  In the old days, we really transferred money around; today the central banks can just increase balances on computers somewhere.  Billions of dollars can be created or destroyed in seconds.  

We could avoid financial collapse with sober spending, and intelligent regulations.  In other words, we're screwed.  A group of former sailors say they object to the phrase "spending like drunken sailors", because they stopped spending when they ran out of money, no matter how drunk they were.  The proposed financial regulation bill in congress is the usual Washington crap.  It addresses the wrong problems, ignores the real problems, and creates new problems to go with them.   

I think it looks increasingly likely that a second downturn will occur sometime soon.  I think the predictions of tax riots and civil unrest here in the US by 2011 from Gerald Celente seem right on. 

My advice is the timeless classic: beans, bullets and band-aids.  Precious metals, like lead, copper and brass:

and pray....