Mar 2009
March 29th - God's Adopted Children
28/March/2009 19:12 Filed in: Heidleberg Catechism
Lord's Day 13
33. Q. Why is He called God's only begotten Son, since we also are children of God?
A. Because Christ alone is the eternal, natural Son of God.[1] We, however, are children of God by adoption, through grace, for Christ's sake.[2]
[1] John 1:1-3, 14, 18; 3:16; Rom. 8:32; Heb. 1; I John 4:9. [2] John 1:12; Rom. 8:14-17; Gal. 4:6; Eph. 1:5, 6.
34. Q. Why do you call Him our Lord?
A. Because He has ransomed us, body and soul,[1] from all our sins, not with silver or gold but with His precious blood,[2] and has freed us from all the power of the devil to make us His own possession.[3]
[1] I Cor. 6:20; I Tim. 2:5, 6. [2] I Peter 1:18, 19. [3] Col. 1:13, 14; Heb. 2:14, 15.
33. Q. Why is He called God's only begotten Son, since we also are children of God?
A. Because Christ alone is the eternal, natural Son of God.[1] We, however, are children of God by adoption, through grace, for Christ's sake.[2]
[1] John 1:1-3, 14, 18; 3:16; Rom. 8:32; Heb. 1; I John 4:9. [2] John 1:12; Rom. 8:14-17; Gal. 4:6; Eph. 1:5, 6.
34. Q. Why do you call Him our Lord?
A. Because He has ransomed us, body and soul,[1] from all our sins, not with silver or gold but with His precious blood,[2] and has freed us from all the power of the devil to make us His own possession.[3]
[1] I Cor. 6:20; I Tim. 2:5, 6. [2] I Peter 1:18, 19. [3] Col. 1:13, 14; Heb. 2:14, 15.
Interlude
25/March/2009 09:06 Filed in: Weekly Column
It seems like this whole economic mess had its beginnings in the 1970s. I suppose you could blame it on the Viet Nam war but that probably is a gross simplification. The music of that era seems especially relevant today. Last week we began “The War on Small” with the first line of a 1969 song: War – What is it good for? Absolutely nothing!
This week as I was researching the background for Monday’s “Special Report - Prosperity Myth” the words of Simon and Garfunkel’s 1970 song, “Keep The Customer Satisfied” seemed to be completely fitting. As long as the Prosperity Myth functioned smoothly and everyone thought they were rich and secure, life was just a “Bobos in Paradise” to use the title of a David Brooks book, all that was required was to “Keep the Customer Satisfied.” So we got more and better stuff cheaper and cheaper. Hallelujah, material heaven here on earth!
However, it now seems that the recent worldwide love affair with President Barack Obama is beginning to show some stress. Basically two thirds of the way through his first 100 days, more and more comments and editorials, about not being up to the job, not ready for prime time, inept management, out of touch, gallows humor, punch drunk, a way to hell, and others are now being used. As his poll numbers deteriorate with all but the political class, it doesn’t seem that reassuring when Congress has only continued or enhanced its numskull performances dating from the Bush Administration. Then there is the debt situation; it is impossible to even keep track of the various trillions here, there, and everywhere.
Read More...
This week as I was researching the background for Monday’s “Special Report - Prosperity Myth” the words of Simon and Garfunkel’s 1970 song, “Keep The Customer Satisfied” seemed to be completely fitting. As long as the Prosperity Myth functioned smoothly and everyone thought they were rich and secure, life was just a “Bobos in Paradise” to use the title of a David Brooks book, all that was required was to “Keep the Customer Satisfied.” So we got more and better stuff cheaper and cheaper. Hallelujah, material heaven here on earth!
However, it now seems that the recent worldwide love affair with President Barack Obama is beginning to show some stress. Basically two thirds of the way through his first 100 days, more and more comments and editorials, about not being up to the job, not ready for prime time, inept management, out of touch, gallows humor, punch drunk, a way to hell, and others are now being used. As his poll numbers deteriorate with all but the political class, it doesn’t seem that reassuring when Congress has only continued or enhanced its numskull performances dating from the Bush Administration. Then there is the debt situation; it is impossible to even keep track of the various trillions here, there, and everywhere.
Read More...
Special Report - The Prosperity Myth
23/March/2009 12:01 Filed in: Special Report
Special Report – The Prosperity Myth
The only thing we have to fear is reality itself. That reality is that much of America’s and the world’s recent wealth was based solely upon a Prosperity Myth. Most people are now afraid to look at reality. Is that stress, fear, or lack of mature coping skills?
The psychoanalysis definition of narcissism is: Self-centeredness arising from failure to distinguish the self from external objects, either in very young babies or as a feature of mental disorder.
What is the foundation of your life? For most people today that foundation is money. “Show me the money,” is the cultural ethic for today’s world. Reverence for God is where your created reality truly finds ultimate meaning, flowing from your created past, through the present, and into eternity. However pretty much all religious institutions now are based on a paradigm, not of amazing grace, but “give to get.”
Pretty much everyone hopes for security, especially future security. However, now seems to be all we have, the future has become an illusion, because the Federal Government is aggressively playing with the future in the hopes of maintaining a myth of sustainable prosperity.
Last week I was reading an article, which used as an illustration the following Monetary Base graphic from the Federal Reserve. That article focused upon the tremendous gain in the Monetary Base in the very recent past. What I found quite interesting was the distinct similarity between this illustration and the data I used two weeks ago in a weekly column, “Trilogy – The Dow’s Hidden Reality.”
Federal Reserve Monetary Base
Searching for a meaningful representation of that Dow data, I was able to find this chart from the Wall Street Journal’s Market Watch. Except for that brief peak centered around the year 2000 the graphs are pretty much the same. Also interesting is the graph on the trading volume. That pretty much represents you trying to find financial security by investing your then present prosperity in Wall Street, either by various retirement mechanisms, or as a direct investor. Notice that Wall Street investing by normal folks was not normal at all until the market really began to take off exponentially in the late 1990s.
Since all my statistics books are in storage, I began to wonder just how tight the data from the Fed’s Monetary Base and the Dow Average correlated. So Sunday afternoon for every five years from 1970 through 2005 I estimated both the average yearly value for the Dow and the Monetary Base and incorporated those numbers into an Excel spreadsheet. On that data I ran a correlation coefficient (CORREL) and found a value of 0.96.
A number that high is very significant when you consider that both the Monetary Base data and the Dow level are supposedly somewhat financial independent fruits. What that really means is that they are not independent at all. A controlled or managed increase in the monetary base causes a strongly related increase in the Dow, or your perceived future wealth. That is all great if the model and the data relate to the real world. If it does not that means you are being taken, cheated, believing a lie, or being just passive, in the best interpretations. Taken, as a worst case, there is now a dude named Bernie Madoff doing time for a similar scheme for basically comparison chump change.
In that “Dow’s Hidden Reality” portion of our recent article we made the case that true real increases in wealth are linear functions. What that means is if you look at the Dow increasing value graph above and draw a straight line from the 1970s through the early 1980s that line will intersect the right axis of the graph somewhere between a Dow of 2000 – 4000 depending how optimistic you choose to be. As we related in that article this increasing wealth relates somewhat directly to the linear growth of “GDP with the money backed out.” This is quite similar to what you would see in a sustainable natural system.
Treasury Secretary Geithner today spelled out the specifics of his bank rescue package, which was first announced with great fanfare on February tenth. So now a month and some change later, we have some details that will save Wall Street and big financial investment opportunities. All those toxic assets, actually all assets, currently have some toxic components related to implied wealth compared to real wealth. As we throw another trillion at the problem, how can you, in the same asset, separate the good portion from the bad? Mark to market accounting is not up to that task and actually may become a hindrance.
But the biggest question still remains, is the model of exponential Wall Street growth still viable? Just trust in the ever-changing parameters of the hope of wishful thinking. We a told by all the powers who are in control, if we just create enough debt it will all work out fine.
Secretary Geithner is still short some-teen Assistant Secretaries at Treasury. So the question remains who designed this plan? Evidence so far indicates that the secretary is pretty much a loan lone ranger when it comes to being a competent manager. In stupendous change times like this the United States and the world should demand a competent and strong Treasury leader. But where would you find someone not tied to the Wall Street Prosperity Myth?
However, this angst was greatly calmed last week by Fed Chairman Ben Bernanke purchasing three hundred billion of securities from the Treasury to become assets for the Fed. Of course he used basically debt securities to purchase these securities. But at least he still believes in the model he inherited from Alan Greenspan that got us into this mess to begin with. This move essentially resulted in a dollar devaluation compared to the Euro of about seven percent and a rise of commodities especially gold and oil.
The President for his part that evening told some jokes on late night television. This week he moves the gig to a primetime news conference. So if we choose to watch we will see his teleprompter roll lines from a version of Hamlet, updated into radical Chicago political euphemisms.
Then on Friday the House of Representatives voted for a 90% tax on Executive Bonuses. That outrage, because they were all so serious, seems to make all the above look like genuine applied genius.
The real problem facing the country and the world is that all these attempts to bailout Wall Street misses the true wealth of the United States and that is the country’s entrepreneurial spirit. Furthermore this period of Wall Street supremacy destroyed the capital infrastructure required to rapidly fund these opportunities for true new sustainable enterprise growth. The only way this change will come is when those who still have some real wealth remaining, begin investing in true wealth creation at the grassroots level. True growth will on occur by promoting a Prosperity Myth debt funded by financial and governmental dinosaurs.
The only thing we have to fear is reality itself. That reality is that much of America’s and the world’s recent wealth was based solely upon a Prosperity Myth. Most people are now afraid to look at reality. Is that stress, fear, or lack of mature coping skills?
The psychoanalysis definition of narcissism is: Self-centeredness arising from failure to distinguish the self from external objects, either in very young babies or as a feature of mental disorder.
What is the foundation of your life? For most people today that foundation is money. “Show me the money,” is the cultural ethic for today’s world. Reverence for God is where your created reality truly finds ultimate meaning, flowing from your created past, through the present, and into eternity. However pretty much all religious institutions now are based on a paradigm, not of amazing grace, but “give to get.”
Pretty much everyone hopes for security, especially future security. However, now seems to be all we have, the future has become an illusion, because the Federal Government is aggressively playing with the future in the hopes of maintaining a myth of sustainable prosperity.
Last week I was reading an article, which used as an illustration the following Monetary Base graphic from the Federal Reserve. That article focused upon the tremendous gain in the Monetary Base in the very recent past. What I found quite interesting was the distinct similarity between this illustration and the data I used two weeks ago in a weekly column, “Trilogy – The Dow’s Hidden Reality.”
Federal Reserve Monetary Base
Searching for a meaningful representation of that Dow data, I was able to find this chart from the Wall Street Journal’s Market Watch. Except for that brief peak centered around the year 2000 the graphs are pretty much the same. Also interesting is the graph on the trading volume. That pretty much represents you trying to find financial security by investing your then present prosperity in Wall Street, either by various retirement mechanisms, or as a direct investor. Notice that Wall Street investing by normal folks was not normal at all until the market really began to take off exponentially in the late 1990s.
Since all my statistics books are in storage, I began to wonder just how tight the data from the Fed’s Monetary Base and the Dow Average correlated. So Sunday afternoon for every five years from 1970 through 2005 I estimated both the average yearly value for the Dow and the Monetary Base and incorporated those numbers into an Excel spreadsheet. On that data I ran a correlation coefficient (CORREL) and found a value of 0.96.
A number that high is very significant when you consider that both the Monetary Base data and the Dow level are supposedly somewhat financial independent fruits. What that really means is that they are not independent at all. A controlled or managed increase in the monetary base causes a strongly related increase in the Dow, or your perceived future wealth. That is all great if the model and the data relate to the real world. If it does not that means you are being taken, cheated, believing a lie, or being just passive, in the best interpretations. Taken, as a worst case, there is now a dude named Bernie Madoff doing time for a similar scheme for basically comparison chump change.
In that “Dow’s Hidden Reality” portion of our recent article we made the case that true real increases in wealth are linear functions. What that means is if you look at the Dow increasing value graph above and draw a straight line from the 1970s through the early 1980s that line will intersect the right axis of the graph somewhere between a Dow of 2000 – 4000 depending how optimistic you choose to be. As we related in that article this increasing wealth relates somewhat directly to the linear growth of “GDP with the money backed out.” This is quite similar to what you would see in a sustainable natural system.
Treasury Secretary Geithner today spelled out the specifics of his bank rescue package, which was first announced with great fanfare on February tenth. So now a month and some change later, we have some details that will save Wall Street and big financial investment opportunities. All those toxic assets, actually all assets, currently have some toxic components related to implied wealth compared to real wealth. As we throw another trillion at the problem, how can you, in the same asset, separate the good portion from the bad? Mark to market accounting is not up to that task and actually may become a hindrance.
But the biggest question still remains, is the model of exponential Wall Street growth still viable? Just trust in the ever-changing parameters of the hope of wishful thinking. We a told by all the powers who are in control, if we just create enough debt it will all work out fine.
Secretary Geithner is still short some-teen Assistant Secretaries at Treasury. So the question remains who designed this plan? Evidence so far indicates that the secretary is pretty much a loan lone ranger when it comes to being a competent manager. In stupendous change times like this the United States and the world should demand a competent and strong Treasury leader. But where would you find someone not tied to the Wall Street Prosperity Myth?
However, this angst was greatly calmed last week by Fed Chairman Ben Bernanke purchasing three hundred billion of securities from the Treasury to become assets for the Fed. Of course he used basically debt securities to purchase these securities. But at least he still believes in the model he inherited from Alan Greenspan that got us into this mess to begin with. This move essentially resulted in a dollar devaluation compared to the Euro of about seven percent and a rise of commodities especially gold and oil.
The President for his part that evening told some jokes on late night television. This week he moves the gig to a primetime news conference. So if we choose to watch we will see his teleprompter roll lines from a version of Hamlet, updated into radical Chicago political euphemisms.
Then on Friday the House of Representatives voted for a 90% tax on Executive Bonuses. That outrage, because they were all so serious, seems to make all the above look like genuine applied genius.
The real problem facing the country and the world is that all these attempts to bailout Wall Street misses the true wealth of the United States and that is the country’s entrepreneurial spirit. Furthermore this period of Wall Street supremacy destroyed the capital infrastructure required to rapidly fund these opportunities for true new sustainable enterprise growth. The only way this change will come is when those who still have some real wealth remaining, begin investing in true wealth creation at the grassroots level. True growth will on occur by promoting a Prosperity Myth debt funded by financial and governmental dinosaurs.
March 22 - Christ and Christians
21/March/2009 18:26 Filed in: Heidleberg Catechism
Lord's Day 12
31. Q. Why is He called Christ, that is, Anointed?
A. Because He has been ordained by God the Father, and anointed with the Holy Spirit,[1] to be our chief Prophet and Teacher,[2] who has fully revealed to us the secret counsel and will of God concerning our redemption;[3] our only High Priest,[4] who by the one sacrifice of His body has redeemed us,[5] and who continually intercedes for us before the Father;[6] and our eternal King,[7] who governs us by His Word and Spirit, and who defends and preserves us in the redemption obtained for us.[8]
[1] Ps. 45:7 (Heb. 1:9); Is. 61:1 (Luke 4:18; Luke 3:21, 22. [2] Deut. 18:15 (Acts 3:22). [3] John 1:18; 15:15. [4] Ps. 110:4 (Heb. 7:17). [5] Heb. 9:12; 10:11-14. [6] Rom. 8:34; Heb. 9:24; I John 2:1. [7] Zach. 9:9 (Matt. 21:5); Luke 1:33. [8] Matt. 28:18-20; John 10:28; Rev. 12:10, 11.
32. Q. Why are you called a Christian?
A. Because I am a member of Christ by faith[1] and thus share in His anointing,[2] so that I may as prophet confess His Name,[3] as priest present myself a living sacrifice of thankfulness to Him,[4] and as king fight with a free and good conscience against sin and the devil in this life,[5] and hereafter reign with Him eternally over all creatures.[6]
[1] I Cor. 12:12-27. [2] Joel 2:28 (Acts 2:17); I John 2:27. [3] Matt. 10:32; Rom 10:9, 10; Heb. 13:15. [4] Rom. 12:1; I Pet. 2:5, 9. [5] Gal. 5:16, 17; Eph. 6:11; I Tim. 1:18, 19. [6] Matt. 25:34; II Tim. 2:12.
31. Q. Why is He called Christ, that is, Anointed?
A. Because He has been ordained by God the Father, and anointed with the Holy Spirit,[1] to be our chief Prophet and Teacher,[2] who has fully revealed to us the secret counsel and will of God concerning our redemption;[3] our only High Priest,[4] who by the one sacrifice of His body has redeemed us,[5] and who continually intercedes for us before the Father;[6] and our eternal King,[7] who governs us by His Word and Spirit, and who defends and preserves us in the redemption obtained for us.[8]
[1] Ps. 45:7 (Heb. 1:9); Is. 61:1 (Luke 4:18; Luke 3:21, 22. [2] Deut. 18:15 (Acts 3:22). [3] John 1:18; 15:15. [4] Ps. 110:4 (Heb. 7:17). [5] Heb. 9:12; 10:11-14. [6] Rom. 8:34; Heb. 9:24; I John 2:1. [7] Zach. 9:9 (Matt. 21:5); Luke 1:33. [8] Matt. 28:18-20; John 10:28; Rev. 12:10, 11.
32. Q. Why are you called a Christian?
A. Because I am a member of Christ by faith[1] and thus share in His anointing,[2] so that I may as prophet confess His Name,[3] as priest present myself a living sacrifice of thankfulness to Him,[4] and as king fight with a free and good conscience against sin and the devil in this life,[5] and hereafter reign with Him eternally over all creatures.[6]
[1] I Cor. 12:12-27. [2] Joel 2:28 (Acts 2:17); I John 2:27. [3] Matt. 10:32; Rom 10:9, 10; Heb. 13:15. [4] Rom. 12:1; I Pet. 2:5, 9. [5] Gal. 5:16, 17; Eph. 6:11; I Tim. 1:18, 19. [6] Matt. 25:34; II Tim. 2:12.
The war on small
18/March/2009 16:50 Filed in: Weekly Column
War – What is it good for? Absolutely nothing!
So goes the first line of the 1969 song by Norman Whitfield and Barrett Strong and released by Motown - first by the Temptations and then by Edwin Starr in 1970. The edgy Starr rendition is what we are most familiar, the prior Temptations recording is somewhat more refined if a true war protest song can ever be refined. War was also recorded by Bruce Springsteen in the 1980s. All three versions are available on iTunes.
Vietnam was called a war, so was Iraq, and Afghanistan. Less we forget, well, actually we want to forget, there still is the War on Terror, refocused by the self proclaimed more civilized Obama Administration into some security or insecurity measures against a few people who don’t agree with American values.
Have you ever heard of the War on Small? Of course the War on Small begs the question small what, or who. Yep! All of the above, but for the purposes of this week’s article we will try to focus upon small enterprise.
Did you miss the news on President Obama’s small business initiative sometime Monday? By Tuesday it was not anywhere to be found on the leading news feeds? The Wall Street Journal’s weekly Small Business Update email had one article that is worth reading. Basically it says that in the diverse small business universe, again the President was long on hyperbole and short on substance. The only meaningful content comes only to the small portion of small businesses that use SBA loan guarantees.
Yippy – Skippy!
Read More...
So goes the first line of the 1969 song by Norman Whitfield and Barrett Strong and released by Motown - first by the Temptations and then by Edwin Starr in 1970. The edgy Starr rendition is what we are most familiar, the prior Temptations recording is somewhat more refined if a true war protest song can ever be refined. War was also recorded by Bruce Springsteen in the 1980s. All three versions are available on iTunes.
Vietnam was called a war, so was Iraq, and Afghanistan. Less we forget, well, actually we want to forget, there still is the War on Terror, refocused by the self proclaimed more civilized Obama Administration into some security or insecurity measures against a few people who don’t agree with American values.
Have you ever heard of the War on Small? Of course the War on Small begs the question small what, or who. Yep! All of the above, but for the purposes of this week’s article we will try to focus upon small enterprise.
Did you miss the news on President Obama’s small business initiative sometime Monday? By Tuesday it was not anywhere to be found on the leading news feeds? The Wall Street Journal’s weekly Small Business Update email had one article that is worth reading. Basically it says that in the diverse small business universe, again the President was long on hyperbole and short on substance. The only meaningful content comes only to the small portion of small businesses that use SBA loan guarantees.
Yippy – Skippy!
Read More...
March 15 - Jesus is Savior!
14/March/2009 18:44 Filed in: Heidleberg Catechism
Lord's Day 11
29. Q. Why is the Son of God called Jesus, that is, Saviour?
A. Because He saves us from all our sins,[1] and because salvation is not to be sought or found in anyone else.[2]
[1] Matt. 1:21; Heb. 7:25. [2] Is. 43:11; John 15:4, 5; Acts 4:11, 12; I Tim. 2:5.
30. Q. Do those believe in the only Saviour Jesus who seek their salvation and well-being from saints, in themselves, or anywhere else?
A. No. Though they boast of Him in words, they in fact deny the only Saviour Jesus.[1] For one of two things must be true: either Jesus is not a complete Saviour, or those who by true faith accept this Saviour must find in Him all that is necessary for their salvation.[2]
[1] I Cor. 1:12, 13; Gal. 5:4. [2] Col. 1:19, 20; 2:10; I John 1:7.
29. Q. Why is the Son of God called Jesus, that is, Saviour?
A. Because He saves us from all our sins,[1] and because salvation is not to be sought or found in anyone else.[2]
[1] Matt. 1:21; Heb. 7:25. [2] Is. 43:11; John 15:4, 5; Acts 4:11, 12; I Tim. 2:5.
30. Q. Do those believe in the only Saviour Jesus who seek their salvation and well-being from saints, in themselves, or anywhere else?
A. No. Though they boast of Him in words, they in fact deny the only Saviour Jesus.[1] For one of two things must be true: either Jesus is not a complete Saviour, or those who by true faith accept this Saviour must find in Him all that is necessary for their salvation.[2]
[1] I Cor. 1:12, 13; Gal. 5:4. [2] Col. 1:19, 20; 2:10; I John 1:7.
Obama's Stimulus Keynes Model is Questioned
12/March/2009 11:47 Filed in: Oikos Thoughts | Web News
Into our valley of economic turpitude rode President Obama’s itty-bitty team of economic knights to tell us with the passage of the stimulus plan the City of Eternal Prosperity was just a steep monetary deficit climb away. To reach that city they offered us some Keynesian economic projections of continual prosperity to come. They then supplied us all with rose colored glasses, whereby we could see through the dust of enterprise destruction and gain a vision of this summit Auda-City of Hope.
People generally and Americans specifically are really pretty skeptical of evangelists of any fashion, hence many refused the put-on and decided they would continue to struggle slowly through the haze. As reported in a Wall Street Journal today in Old Europe Is Right on Stimulus a team of four trans-Atlantic economists, two Americans and two Germans questioned Obama’s Old Keynesian projections with New Keynesian projections. Those projections showed not an eternal plateau of stable economic growth, but a real that Auda-City was not near as high as the itty-bitty knights predicted, and furthermore there was another very deep valley on the other side of the hill. A link to that New Keynesian versus Old Keynesian Government Spending Multipliers paper is found under our Resources Tab.
Not having that much formal education in economics it is interesting to see the similarities between two of our Business Ecology Growth Curves below as they relate to the projections of the Old Keynesian Obama knights and the New Keynesian study.
Read More...
People generally and Americans specifically are really pretty skeptical of evangelists of any fashion, hence many refused the put-on and decided they would continue to struggle slowly through the haze. As reported in a Wall Street Journal today in Old Europe Is Right on Stimulus a team of four trans-Atlantic economists, two Americans and two Germans questioned Obama’s Old Keynesian projections with New Keynesian projections. Those projections showed not an eternal plateau of stable economic growth, but a real that Auda-City was not near as high as the itty-bitty knights predicted, and furthermore there was another very deep valley on the other side of the hill. A link to that New Keynesian versus Old Keynesian Government Spending Multipliers paper is found under our Resources Tab.
Not having that much formal education in economics it is interesting to see the similarities between two of our Business Ecology Growth Curves below as they relate to the projections of the Old Keynesian Obama knights and the New Keynesian study.
Read More...
Trilogy: Two-headed Coins, The Dow’s Hidden Reality, Sufficient Grace
11/March/2009 10:32 Filed in: Weekly Column
Blame it on climate change. Mostly the economic climate, but also a March snowfall, and plunging temperatures that Tuesday night reached 8 degrees (-13C), with so far 3 record cold nights in a row. This week we have a double length unity in diversity article, that looks in diverse ways at the economic climate, and leads one to still believe that spring always follows the winter, even if today winter looks all too real.
Last Thursday evening was one of the most difficult times I can remember in a very long time. For the most part, I try to look at the world as a realistic optimist. After the Dow fell 300 points and played around 6500, I had to admit that things are getting seriously serious. That number was a thousand points lower than my somewhat flippant prediction of 7500 by Inauguration Day, which really didn’t happen until Economic Stimulus Day. But it was also only a thousand points above the 5500 level predicted by a real financial planner I talked with during a holiday office thing. If things continue on this current path the Dow could be at 5500 by April Fools Day.
Times are serious, and it is time for the folks to get serious also, that I realized meant the pointing finger also had three pointing back at me.
Most of the economic news now uses the 1982 recession as sort of a benchmark for where we are now. In that light 1982 was a life-changing period in my life, which basically has led me to where I am today. Considering all that has happened since that time, in the transcendent eternal sense, I am one of the more wealthy people in the world. Materially and economically things really are not all that much different than back then, maybe even quantitatively below that recessionary level.
In about the middle of the wonderful year of 1982, my folder of job rejection letters reached the thickness of maybe an inch and a half. In the year and a few months since I had been somewhat forcibly removed from corporate America, the only real potential opportunities had come from Long Beach, California, and Houston, Texas, both on my bottom ten places to live in the United States.
The amazing thing is just a few months before my trip to the unemployment office; my cute, corporate headhunter had told me, that with my qualifications I was probably one of the top six candidates in the country in my field. That all changed when new President Ronald Reagan, basically shut down the EPA and put all the new federal hazardous waste regulations on hold.
That pile of rejection letters changed my life; in conjunction with a phone call I received from one business manager, who instead of sending me another rejection letter decided to give me a call. The call came from a sales manager of a copier sales company where I had applied for an entry-level sales position. At that time copier sales people were required to make at least forty external cold calls per day, as well as follow up on any other slim leads that may have been generated by some other means.
The reason that this manager decided to give me a call was because, as we determined, he had been in the class just before me at the Army Security Agency Officers Class at Ft. Devens, Massachusetts. He stated that he had taken that copier sales job (perhaps in the 1973-75 recession) and had just gotten to the point where he could relax a bit, and that there was no way he was ever going to hire anyone that might threaten that long sought security, which he could easily discern from my resume.
Read More...
Last Thursday evening was one of the most difficult times I can remember in a very long time. For the most part, I try to look at the world as a realistic optimist. After the Dow fell 300 points and played around 6500, I had to admit that things are getting seriously serious. That number was a thousand points lower than my somewhat flippant prediction of 7500 by Inauguration Day, which really didn’t happen until Economic Stimulus Day. But it was also only a thousand points above the 5500 level predicted by a real financial planner I talked with during a holiday office thing. If things continue on this current path the Dow could be at 5500 by April Fools Day.
Times are serious, and it is time for the folks to get serious also, that I realized meant the pointing finger also had three pointing back at me.
Most of the economic news now uses the 1982 recession as sort of a benchmark for where we are now. In that light 1982 was a life-changing period in my life, which basically has led me to where I am today. Considering all that has happened since that time, in the transcendent eternal sense, I am one of the more wealthy people in the world. Materially and economically things really are not all that much different than back then, maybe even quantitatively below that recessionary level.
In about the middle of the wonderful year of 1982, my folder of job rejection letters reached the thickness of maybe an inch and a half. In the year and a few months since I had been somewhat forcibly removed from corporate America, the only real potential opportunities had come from Long Beach, California, and Houston, Texas, both on my bottom ten places to live in the United States.
The amazing thing is just a few months before my trip to the unemployment office; my cute, corporate headhunter had told me, that with my qualifications I was probably one of the top six candidates in the country in my field. That all changed when new President Ronald Reagan, basically shut down the EPA and put all the new federal hazardous waste regulations on hold.
That pile of rejection letters changed my life; in conjunction with a phone call I received from one business manager, who instead of sending me another rejection letter decided to give me a call. The call came from a sales manager of a copier sales company where I had applied for an entry-level sales position. At that time copier sales people were required to make at least forty external cold calls per day, as well as follow up on any other slim leads that may have been generated by some other means.
The reason that this manager decided to give me a call was because, as we determined, he had been in the class just before me at the Army Security Agency Officers Class at Ft. Devens, Massachusetts. He stated that he had taken that copier sales job (perhaps in the 1973-75 recession) and had just gotten to the point where he could relax a bit, and that there was no way he was ever going to hire anyone that might threaten that long sought security, which he could easily discern from my resume.
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March 8th - God's Providence
07/March/2009 15:29 Filed in: Heidleberg Catechism
Lord's Day 10
27. Q. What do you understand by the providence of God?
A. God's providence is His almighty and ever present power,[1] whereby, as with His hand, He still upholds heaven and earth and all creatures,[2] and so governs them that leaf and blade, rain and drought, fruitful and barren years, food and drink, health and sickness, riches and poverty,[3] indeed, all things, come not by chance[4] but by His fatherly hand.[5]
[1] Jer. 23:23, 24; Acts 17:24-28. [2] Heb. 1:3. [3] Jer. 5:24; Acts 14:15-17; John 9:3; Prov. 22:2. [4] Prov. 16:33. [5] Matt. 10:29.
28. Q. What does it benefit us to know that God has created all things and still upholds them by His providence?
A. We can be patient in adversity,[1] thankful in prosperity,[2] and with a view to the future we can have a firm confidence in our faithful God and Father that no creature shall separate us from His love;[3] for all creatures are so completely in His hand that without His will they cannot so much as move.[4]
[1] Job. 1:21, 22; Ps. 39:10; James 1:3. [2] Deut. 8:10; I Thess. 5:18. [3] Ps. 55:22; Rom. 5:3-5; 8:38, 39. [4] Job 1:12; 2:6; Prov. 21:1; Acts 17:24-28.
27. Q. What do you understand by the providence of God?
A. God's providence is His almighty and ever present power,[1] whereby, as with His hand, He still upholds heaven and earth and all creatures,[2] and so governs them that leaf and blade, rain and drought, fruitful and barren years, food and drink, health and sickness, riches and poverty,[3] indeed, all things, come not by chance[4] but by His fatherly hand.[5]
[1] Jer. 23:23, 24; Acts 17:24-28. [2] Heb. 1:3. [3] Jer. 5:24; Acts 14:15-17; John 9:3; Prov. 22:2. [4] Prov. 16:33. [5] Matt. 10:29.
28. Q. What does it benefit us to know that God has created all things and still upholds them by His providence?
A. We can be patient in adversity,[1] thankful in prosperity,[2] and with a view to the future we can have a firm confidence in our faithful God and Father that no creature shall separate us from His love;[3] for all creatures are so completely in His hand that without His will they cannot so much as move.[4]
[1] Job. 1:21, 22; Ps. 39:10; James 1:3. [2] Deut. 8:10; I Thess. 5:18. [3] Ps. 55:22; Rom. 5:3-5; 8:38, 39. [4] Job 1:12; 2:6; Prov. 21:1; Acts 17:24-28.
Betting on a real depression
05/March/2009 11:24 Filed in: Oikos Thoughts | Web News
What are the odds of a real depression?
Yesterday an article in the Wall Street Journal put that probability at about 20%. Is that good news or bad news, I assume that is truly an individual determination?
What Are the Odds of a Depression? by Robert J. Barrow, examines just that possibility. The report is based upon looking at 251 stock-market crashes from around the world dating back to 1870. When you factor out those associated with major wars, the current Iraq and Afghanistan conflicts do not apply, you are left with 209 crashes and 59 depressions. Defining a minor depression as at least a 10% decrease in GDP, and a major depression of a 25% decrease in GDP, crunching the numbers, resulted in the 20% number and the 2% probability respectively. The details are well spelled out in the article, as well as the title of the working paper source document.
This somewhat intertwines with thoughts in yesterday’s article which generally ties true wealth directly to stock market Dow Jones Industrial Averages. The reference point to which most recently relates, in both our article and the Barrow depression data, is to the recession of 1982 when GDP fell 3%.
In our faux pas article was also a remark about 1971, when President Nixon unilaterally took the United States out of the Bretton Woods Agreement that served us well in the post WWII redevelopment of world economies.
In that light I became inquisitive of just what were those Dow numbers from 1982 and 1971 and how they might compare with where we are now and that Dow high from 2007. That all time high came in October 2007 @ 14280. Therefore if we use this as a richness zenith, it has been downhill since that point, approximately 55%. Dow numbers for the 1971 year averaged pretty steady around 900. The numbers for 1982 were quite similar to those in 1971, except for a rally near year end that took the Dow to about 1100.
Now these numbers do not include inflation which was considerable especially surrounding the 1982 recession, or the period of stagflation. However it could be argued that inflation numbers are built into the Dow average itself, so backing out a composite inflation number, while it does make one feel somewhat better, really is not a meaningful exercise. So if you are averaging the weight of apples, it doesn’t make much sense to throw in an orange weighing exercise, unless you are not dealing with apples and oranges, but generalized fruit weights.
The biggest change however, and probably the most significant force in driving up the Dow was a rapidly increasing number of small individual investors from the 1970s and onward. The concept of investing in common stock equity as a means to grow your retirement, walked in lock step with buying your own home as your major source of wealth. If you could couple some sense of real estate speculation with a somewhat risky growth stock play, you could retire early with little true risk?
The question then surfaces does this increase from around 1100 to an excess of 14,000 mean a true increase in wealth or just a dilution of the underlying wealth according to market supply and demand characteristics relating to increasingly cheap money and debt leverage? Lacking any sort of meaningful analysis by some truly independent source, the question will probably be somewhat answered by another question. “Just how low will it go?”
So we are learning that the past and the present does not always indicate the future. We believed the words would make the numbers work. Now we are all learning that our words and numbers do not create or even forecast reality. Some will find that an impossible lesson to learn.
We have also provided a link to the Depression Odds article under our Resources tab.
Yesterday an article in the Wall Street Journal put that probability at about 20%. Is that good news or bad news, I assume that is truly an individual determination?
What Are the Odds of a Depression? by Robert J. Barrow, examines just that possibility. The report is based upon looking at 251 stock-market crashes from around the world dating back to 1870. When you factor out those associated with major wars, the current Iraq and Afghanistan conflicts do not apply, you are left with 209 crashes and 59 depressions. Defining a minor depression as at least a 10% decrease in GDP, and a major depression of a 25% decrease in GDP, crunching the numbers, resulted in the 20% number and the 2% probability respectively. The details are well spelled out in the article, as well as the title of the working paper source document.
This somewhat intertwines with thoughts in yesterday’s article which generally ties true wealth directly to stock market Dow Jones Industrial Averages. The reference point to which most recently relates, in both our article and the Barrow depression data, is to the recession of 1982 when GDP fell 3%.
In our faux pas article was also a remark about 1971, when President Nixon unilaterally took the United States out of the Bretton Woods Agreement that served us well in the post WWII redevelopment of world economies.
In that light I became inquisitive of just what were those Dow numbers from 1982 and 1971 and how they might compare with where we are now and that Dow high from 2007. That all time high came in October 2007 @ 14280. Therefore if we use this as a richness zenith, it has been downhill since that point, approximately 55%. Dow numbers for the 1971 year averaged pretty steady around 900. The numbers for 1982 were quite similar to those in 1971, except for a rally near year end that took the Dow to about 1100.
Now these numbers do not include inflation which was considerable especially surrounding the 1982 recession, or the period of stagflation. However it could be argued that inflation numbers are built into the Dow average itself, so backing out a composite inflation number, while it does make one feel somewhat better, really is not a meaningful exercise. So if you are averaging the weight of apples, it doesn’t make much sense to throw in an orange weighing exercise, unless you are not dealing with apples and oranges, but generalized fruit weights.
The biggest change however, and probably the most significant force in driving up the Dow was a rapidly increasing number of small individual investors from the 1970s and onward. The concept of investing in common stock equity as a means to grow your retirement, walked in lock step with buying your own home as your major source of wealth. If you could couple some sense of real estate speculation with a somewhat risky growth stock play, you could retire early with little true risk?
The question then surfaces does this increase from around 1100 to an excess of 14,000 mean a true increase in wealth or just a dilution of the underlying wealth according to market supply and demand characteristics relating to increasingly cheap money and debt leverage? Lacking any sort of meaningful analysis by some truly independent source, the question will probably be somewhat answered by another question. “Just how low will it go?”
So we are learning that the past and the present does not always indicate the future. We believed the words would make the numbers work. Now we are all learning that our words and numbers do not create or even forecast reality. Some will find that an impossible lesson to learn.
We have also provided a link to the Depression Odds article under our Resources tab.
The faux pas presumption paradigm
04/March/2009 10:19 Filed in: Weekly Column
The Noise on the Western Front increased considerably in the past week. The essential reason for that increase is that we all continue to believe in a faux pas presumption paradigm. That belief assumes we have within ourselves, within our individual and collective intellect, the potential to make the world a better place and to save ourselves from future destruction.
That is what the Bible calls basically the “unforgivable sin.” Of course we really don’t believe in sin, especially within ourselves, so when it all falls apart, we are completely without the discernment to understand what is and has happened. If that is not a classic faux pas, I do not know what is.
So when President Obama spoke a week ago Tuesday, the speech was so filled with platitudes and generalities that really there was nothing of substance which one might disagree. Furthermore there was a complete disconnect from the outlined shining city on a hill, contrasted with the reality quagmire in the valley of current remorse.
On Thursday in outlining his budget for the next fiscal year, the President kicked up his liberal agenda more than a notch or two, essentially turning his vision of New Deal programs into prescriptions for financial disaster to those who believe in any concept of free market enterprise. From that budget outline it is clear that his Administration wants to turn this crisis-catastrophe into an opportunity to completely make free market enterprise subservient to centralized government planning and control.
On Saturday at the Conservative Political Action Conference, talk show personality Rush Limbaugh, by adding an hour to a programmed twenty-minute speech turned a hoped thoughtful rebuttal to the Obama vision for America, into the opportunity for about an hour nap. When I woke up near the end he was still carrying on about his “first speech to the nation and the world.” Hence I assume I missed very little in the restful interlude.
On Monday the stock market responded to all this Noise, by the Dow dropping 300 points and settling well below 7000 for the first time in more than a decade. My only stock market prediction in this light was the 7500 barrier, which I forecast for Inauguration Day. That had to wait a couple of weeks until the President unveiled his stimulus plan to change the world and to save everything from everybody. But what is a couple of weeks when we all are having so much fun guessing what governmental faux pas will occur next.
With all that good news, around the world the dollar had somewhat of a rally against other currencies showing, I guess, that America remains the economic safe haven in a rapidly deteriorating world. The good thing about the American media is that they are so megalomaniac we really don’t know how bad things are on the rest of the Western Front.
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That is what the Bible calls basically the “unforgivable sin.” Of course we really don’t believe in sin, especially within ourselves, so when it all falls apart, we are completely without the discernment to understand what is and has happened. If that is not a classic faux pas, I do not know what is.
So when President Obama spoke a week ago Tuesday, the speech was so filled with platitudes and generalities that really there was nothing of substance which one might disagree. Furthermore there was a complete disconnect from the outlined shining city on a hill, contrasted with the reality quagmire in the valley of current remorse.
On Thursday in outlining his budget for the next fiscal year, the President kicked up his liberal agenda more than a notch or two, essentially turning his vision of New Deal programs into prescriptions for financial disaster to those who believe in any concept of free market enterprise. From that budget outline it is clear that his Administration wants to turn this crisis-catastrophe into an opportunity to completely make free market enterprise subservient to centralized government planning and control.
On Saturday at the Conservative Political Action Conference, talk show personality Rush Limbaugh, by adding an hour to a programmed twenty-minute speech turned a hoped thoughtful rebuttal to the Obama vision for America, into the opportunity for about an hour nap. When I woke up near the end he was still carrying on about his “first speech to the nation and the world.” Hence I assume I missed very little in the restful interlude.
On Monday the stock market responded to all this Noise, by the Dow dropping 300 points and settling well below 7000 for the first time in more than a decade. My only stock market prediction in this light was the 7500 barrier, which I forecast for Inauguration Day. That had to wait a couple of weeks until the President unveiled his stimulus plan to change the world and to save everything from everybody. But what is a couple of weeks when we all are having so much fun guessing what governmental faux pas will occur next.
With all that good news, around the world the dollar had somewhat of a rally against other currencies showing, I guess, that America remains the economic safe haven in a rapidly deteriorating world. The good thing about the American media is that they are so megalomaniac we really don’t know how bad things are on the rest of the Western Front.
Read More...