Tuesday, March 31, 2009
Things That Piss Helo Off: The Fast Lane
Move!
My apologies for the lack of blogging lately. Work is occupying most of my time, and I’ve been collecting a list of things that piss me off, all of which deserve a blog entry.
In this case, I came across something that couldn’t wait. I’m blogging on my Palm Treo because I’m so pissed off.
If you are driving in the fast lane or the carpool lane, and you notice someone behind you who wants to go by, or is clearly annoyed by the fact that you are going below the speed limit, and you come to the revelation that you are hindering the flow of traffic, just get out of the way.
(Note: my apologies for the typos and/or lack of formatting. As mentioned, I’m blogging on my PDA)
Directive 10-289
I pointed out how I, as a small business owner, am also John Galt. Since we now have Barney “Fannie Mac” Fwank proclaiming that the Government would get to decide the pay and entitlements of many thousands of employees of any company that took taxpayer funds, how much more of a push is it until we get to seeing Rand’s Directive 10-289?
The measure is not limited just to those firms that received the largest sums of money, or just to the top 25 or 50 executives of those companies. It applies to all employees of all companies involved, for as long as the government is invested. And it would not only apply going forward, but also retroactively to existing contracts and pay arrangements of institutions that have already received funds.
In addition, the bill gives Geithner the authority to decide what pay is “unreasonable” or “excessive.” And it directs the Treasury Department to come up with a method to evaluate “the performance of the individual executive or employee to whom the payment relates.”
See for yourself how the policies are becoming more and more closely aligned with Rand’s almost prophetic work…
“In the name of the general welfare to protect the people’s security, to achieve full equality and total stability, it is decreed for the duration of the national emergency that-
Point One: All workers, wage earners, and employees of any kind whatsoever shall henceforth be attached to their jobs and shall not leave nor be dismissed nor change employment, under penalty of a term in jail. The penalty shall be determined by the Unification Board, such board to be appointed by the Bureau Of Economic Planning and National Resources. All person reaching the age of twenty-one shall report to the Unification Board, which shall assign them to where, in its opinion, their services will best serve the interests of the nation.
Point Two: All industrial, commercial, manufacturing, and business establishments of any nature whatsoever shall henceforth remain in operation, and the owners of such establishments shall not quit, nor leave, nor retire, nor close, sell or transfer their business, under penalty of the nationalization of their establishment and of any or all their property.
Point Three: All patents and copyrights, pertaining to any devices, inventions, formulas, processes, and works of any nature whatsoever, shall be turned over to the nation as a patriotic emergency gift by means of Gift Certificates to be signed voluntarily by the owners of all such patents and copyrights. The Unification Board shall then license the use of such patents and copyrights to all applicants, equally and without discrimination, for the purpose of elimination monopolistic practices, discarding obsolete products and making the best available to the whole nation. No trademarks, brand names, or copyrighted titles shall be used. Every formerly patented product shall be known by a new name and sold by all manufacturers under the same name, such name to be selected by the Unification Board. All private trademarks and brand names are hereby abolished.
Point Four: No new devices, inventions, products, or goods of any nature whatsoever, not now on the market, shall be produced, invented, manufactured or sold after the date of this directive, The Office of patents and Copyrights is hereby suspended. (Added later in chapter: All “research departments, experimental laboratories, scientific foundations” will be closed except for government-operated facilities.)
Point Five: Every establishment, concern, corporation or person engaged in production of any nature whatsoever shall henceforth produce the same amount of goods per year as is, they or he produced during the Basic Year, no more or no less. The year is to known as the Basic or Yardstick Year is to be the year ending on the date of this directive. Over or under production shall be fined, such fines to be determined by the Unification board.
Point Six: Every person of any age, sex, class or income, shall henceforth spend the same amount of money on the purchase of goods per year as he or she spent during the Basic Year, no more and no less. Over or under purchasing shall be fined, such fines to be determined by the Unification Board.
Point Seven: All wages, prices, salaries, dividends, profits, interest rates and forms of income of any nature whatsoever, shall be frozen at their present figures, as of the date of this directive. (But taxes will be allowed to increase as needed for the public good)
Point Eight: All cases arising from and rules not specifically provided for in this directive, shall be settled and determined by the Unification Board, whose decisions shall be final. ”
Remember that frog in the pot of slowly warming water.
Monday, March 30, 2009
Time’s up, folks!
I’m sorry for those of you who only found out about it this morning, but the contest is now over, and we only received four entries.
While that means that all three prizes will be awarded, maybe I need to ease up on the difficulty level. Even assuming that I have any other contests…
The official answers are as follows. If you have an alternate answer and can show your work, I am willing to listen, but it will have to be compelling evidence.
1. The “official” geographical center of North America is marked by a rock obelisk at Rugby, North Dakota, with the Canadian, Mexican and American flags all displayed nearby. The monument at the “official” geographical center of Australia is marked by a flag atop a replica of a building. What is the sum of the whole degrees of latitude and longitude nearest the original building? (184. The Commonwealth Parliament House in Canberra, Australia, is located at roughly 35d 18m S/149d 07m E. 35 + 149 = 184.)
2. Other than the press corps (some of whom actually served as the pallbearers), Fort Worth police (who were providing security), FBI agents and the men officiating, how many adults attended Lee Harvey Oswald’s funeral? (Three adults, Marina (wife), Robert (brother) and Marguerite (mother), along with Lee’s two infant daughters; you can see a picture of the three of them here and on various YouTube videos, such as this one or this one, although that latter is in Swedish, I think.)
3. Only three musicals in history have earned the Tony Award for “Best Musical” where the book, music, and lyrics were all written by one person. Of the three, how many orders of fries were ordered near the end of Act 1 of the most recent? (13 orders of fries were ordered at the Life Cafe during the singing of “La Vie Boheme” at the end of Act 1 of “Rent”.)
4. How many permanent teeth does the average Canis lupus familiaris domesticus have? (The average adult dog has 42 permanent teeth.)
5. How many letters in the name of the flying thing that reaches the highest speed of any projectile used in a racquet sport? (The word is “shuttlecock”, which has 11 letters, and the sport is badminton. Men’s doubles player Fu Haifeng of China set the official world smash record of 332 km/h (206 mph) on June 3, 2005 in the Sudirman Cup. The fastest smash recorded in the singles competition is 305 km/h (189 mph) by Taufik Hidayat of Indonesia. By comparison, the fastest tennis ball smash has only been clocked as reaching 246km/h (153 mph).)
6. There are one or more letters of the English alphabet that do not appear in any of the official names of the elements of the periodic table. If A=1, B=2, etc., what is the cumulative value of the missing letter(s)? (J=10 and Q=17, and 10 + 17 = 27. ‘Ununquadium’ - prounounced “yoo-none-kwad-ee-um” - is not the official name of Element 114 (un + un + quad = 1 + 1 + 4), merely a placeholder until the credit for discovery is settled and an official name suggested and accepted. In fact, no element with an atomic number of 112 or greater has been officially authenticated yet, much less named. See below the fold for the official list.)
7. The 1985 winner of the Springarn medal had earned a doctorate in Education many years before. What is the sum of the digits of the year that the college where he earned that degree was founded? (18. Bill Cosby’s degree was granted from the University of Massachusetts at Amherst, which was established in 1863. 1 + 8 + 6 + 3 = 18.)
8. The year that the Olympic Games were first televised internationally also saw the election of a US President (as they all do). How old was the losing Vice-Presidential candidate? (1960’s election saw John F. Kennedy and Lyndon Johnson defeat then-VP Richard Nixon. Nixon’s running mate, Henry Cabot Lodge, Jr., was born on July 5, 1902, making him 58 at the time of the November 1960 elections.)
9. How many US Presidents never held any other elective office before being elected to the Oval Office? (5; Zachary Taylor, Ulysses S. Grant, William Howard Taft, Herbert Hoover, and Dwight D. Eisenhower. Grant and Eisenhower were 4-star Generals, Taylor was a 2-star Major General, Hoover was a mining engineer-turned-humanitarian-turned-Secretary of Commerce, and Taft served in several appointed - not elected - positions requiring Senate confirmation (Provisional Governor of Cuba while he was also Secretary of War, and then the Presidentially-appointed position of Civil Governor of the Philippines) and was later the Chief Justice of the Supreme Court until his death. George Washington may not have held a prior elective office under the United States, but he was elected to the Virginia House of Burgesses, as were both Thomas Jefferson and Patrick Henry.)
10. The original series “Lost in Space” was set in the future (as seen from the viewer way back when it was first aired). What are the sum of the digits of the year that the show was set in? (26. The show was set in the year 1997, and 1 + 9 + 9 + 7 = 26.)
11. There are at least three colors that have no rhyming words in the English language. Curiously enough, they all have the same number of letters. How many? (6. Silver, orange and purple all have six letters and no rhymes in English. Two other words that have no rhymes are ‘month’ and ‘wasp’.)
12. How many people on board survived the tragic accident that happened on the 22nd anniversary of George Herman Ruth, Jr.’s first major league home run? (The Hindenburg had 62 survivors; 23 passengers and 39 crew.)
13. Rounded down to the nearest integer, what is the square root of the registry number of the ship hijacked by Khan Noonien Singh? (43. The USS Reliant is NCC-1864. The square root of 1,864 is approximately 43.17, rounded down to 43. It was pointed out that Khan tried to hijack the original Enterprise in the episode “Space Seed”, but that was more accurately described as “attempted mutiny”, since at least one of the Enterprise crewmembers was involved. However, he left the Reliant’s original crew on the Genesis planet, except for the captain and poor Chekov, who were held as hostages, not co-mutineers.)
14. According to the author of the series, how old was the final owner of the Elder Wand when he joined the Auror Department of the Ministry of Magic? (Harry Potter was 17 when he joined, and 26 when he took over, the Department.)
15. The Earth is not a sphere, but is actually an “oblate spheroid”. Due to this fact, the “sea level” beaches of Ecuador are actually farther from the center of the Earth than is the summit of Mount Everest. How many years ago was the only manned expedition to the deepest point in the ocean? (January 23, 1960 was 49 years ago.)
16. Of the 66 books and 1189 chapters in the Bible, there is one chapter that holds the record as the longest. The number of verses in that chapter, being a composite number, can be broken down into several prime divisors. What is the sum of all those prime divisors? (19. 176 = 16 x 11, and 16 is 2 to the 4th power, so it breaks down into 2 + 2 + 2 + 2 + 11 = 19.)
17. Of the many countries in the world that have a sparsely settled population, there are only a few that have an average of less than 10 persons per square mile (appx 3.86 per square kilometer). The nation that has the highest population among those very sparsely settled ones has how many official languages? (2. Canada, with a mere 9.5 people per sq. mi, still has more than 33 million people, and has two official languages, English and French.)
18. To the nearest foot, what is the wingspan of the aircraft disparagingly referred to as “Linda Lovelace”? (The C-5 Galaxy has a wingspan of 67.88 m = 222.7 feet; thus, 223. The “Linda Lovelace” is a joke, because “every time she (the aircraft) kneels, she blows something” or “you could drive a bus down her throat when she tilts her nose up”.)
19. There are 50 independent political entities within the United States, and four of them are technically referred to as ‘Commonwealths’. To the nearest integer, what is the average number of letters in the names of the capitols of those four? (Frankfort KY, Boston MA, Harrisburg PA, and Richmond VA. 9 + 6 + 10 + 8 = 33, and 33/4 = 8.25, rounded down to 8.)
20. On the 50th anniversary of the signing of the Declaration of Independence, John Adams died at the age of 90 years, 247 days, becoming the oldest-living former President. Amazingly, he held this record for more than seventeen decades until October 12, 2001, when Ronald Reagan became 90 years, 248 days old. For how many days did Gerald Ford survive after taking the record away from Reagan? (45. Reagan died at the age of 93 years, 119 days on June 5, 2004. Gerald Ford became 93 years, 120 days old on November 11, 2006, and died 45 days later. Ford’s record will stand at least until November 25, 2017, assuming George H.W. Bush lives that long...)
Sunday, March 29, 2009
Since when …
... does ANY putatively elected politician, no matter the level of government, have the right to fire an employee, ANY employee, of a privately-owned company? (Even if you call it ”asking him to resign”.)
Anyone out there care to guess how the media and the Left (as though there was a difference) would have reacted if Bush had done this kind of dictatorial act?
Yeah. Me, too. 
What does the current Administration have….really?
I have been trying like hell to keep criticism of the current POTUS and his Administration off my lips for the first 100 days....a little promise to myself that I made because I don’t want to be like those whack-jobs that still hold the 2000 Election up as the greatest tragedy in modern times and every action of the US Armed Forces as genocidal or Vietnam-like.
But....I am getting a little weary. I know it’s hard to believe, but I am.
I am going to limit what I say until he’s been in office for 100 days. But, something is bothering me.
What do these guys have. I mean, in the way of policy ideas and explanations and all that crap? Really, we could expand it....what does the Left have at this time? Since I’m not talking about President Obama, I guess I can look at what they have with a critical eye, can’t I?
From what I’ve seen, all they have is George Bush. Really. Still, after all this time, after all the orgasmic, throbbing coverage and promises of HOPENCHANGE and transparency and open debate and bipartisanism and all that rot, we have Vice President Biden apologizing to Latin American countries for our past behavior.
Like we recently did to Russia. And Iran.
See, this is all a continuation of the ‘08 POTUS campaign.....these people, so ill-equipped and so unrealistic are they in their ideological worlds, are still blaming Bush for people not liking us. They are still publicly casting aspersions on the previous Administration.
I say ‘the Left’ because Jimmy Carter made a habit out of doing just that for the past 9 years. They are still trying to curry domestic political gain by saying things like this overseas. The leftist netroots...the Daily Kos readers and the hard Leftist/anti-capitialists...eat that up. They are the fervent supporters of the group that is in power right now, represented by Pelosi, Reid, and the current POTUS, and they believe that the United States should apologize to EVERY country because GWB had the temerity to actually, you know, follow his oath and protect and defend the COTUS.
How dare he!
The other side of this (and I think the hard Left understands this) is that these foreign despots and dictators saw what we did in Iraq and Afghanistan, and were nothing but talk and no action until the Left decided to set itself against Bush. Once the political environment over here led to Bush losing support, the mouths in Tehran and Caracas and Havana started feeling braver. They know that the party that would give in and follow a Carterian, Clintonian, post-nationalist, reactive foreign policy is now in power.
But you realize that doesn’t matter, right? They have no direction, but to blame the last guy and say (yeah, SAY......not do, but SAY) that things will be better now. Yeah, I had a babysitter like that once....when I was 8 or something.
And, if I remember correctly I think I got away with murder, too.
I’m going to break one of my own rules
I have been very careful in trying not to give away any results, not even to tell those who get a perfect score that they are a winner.
I may have been slightly inconsistent, but I’m about to deliberately break it, because I have only had four entrants to the latest contest, and there are two of the questions that not a single one of them has gotten correct.
I know for a fact that the answers I have are the correct ones (I started re-researching when the trend started showing up, and I WARNED you guys about using Wikipedia), and I think that some of the problems might be over the phrasing.
I will report only the following points:
1. None of the entrants I have received to date is a perfect score. In fact, the best score to date is only 16 out of the 20.
2. Pay attention to every word in the question.
3. Don’t assume that there are the same number of days from January 1st through to July 1st as there are from July 1st through to January 1st. There aren’t.
Check your answers.
UPDATE: I shouldn’t have said anything. 
You guys are going to hate me when I post the answers tomorrow.
Saturday, March 28, 2009
Trying something new
I’m trying a new tracking software out, and you can find it in the left column - “Feedjit”
If it causes any problems for anyone, let me know, with details about browser/OS, and I’ll try to figure out where I screwed up.
Congress Shall Make No Law
...respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
Better memorize it while you can, because not only have key parts of it already gone the way of the dodo, but now we have petty city bureaucrats taking away the right of the citizens to peaceably assemble.
And what reason did they give for denying American citizens the right to get together and express their political opinions? The people didn’t have official permission for them to get together, and were not going to receive that permission. Why? Because there were going to be too many!
Suddenly there are going to be additional requirements, such as high-dollar-value liability insurance (how many anti-war marches showed up with such permits and insurance, I wonder?). However, the petty bureaucrat says that he’ll be glad to give permission for the citizens to exercise their rights once they obey his commandments.
Gee, isn’t that peachy-keen? We can actually get PERMISSION to exercise our Constitutionally-protected rights to assembly and political expression, once we meet the arbitrary standards set by government chair-warmers. See, it was the “more than 500” that touched off the rights being denied. So apparently 499 is okay, but toss in a set of twins or a dating couple who might decide to just show up without an RSVP, or might have been visiting the park on other business and got interested in the largish group, and the cops would be sent in to read them the Riot Act, no doubt.
Too many people pissed off at the government, and the government takes away their rights to tell each other about it.
When politicians forget the First Amendment, it is time for the People to remember the Second.
Friday, March 27, 2009
The More, The Merrier
Or, if not “merry”, at least ”willing to admit that they are fed up”.
(Another tip of the sombrero to Mike for this.)
The United States House of Representatives recently passed a blatantly unconstitutional bill, placing confiscatory tax burdens on anyone making more than $250,000 and working for an institution that received more than 5 billion of TARP funds.
The bill was in theory specifically addressed at the false outrage over retention bonuses paid to AIG executives; and is targeted only to their bonuses.
In theory.
Of course, this would be an unconstitutional bill of attainder, which wouldn’t pass even the most cursory constitutional challenge; so it was re-written to be broader.
Broader of course means more people would be affected, and congress would be given more power to steal more money.
In fact, if you read into the implications of the bill; it could be used to levy a 90% tax on any income over $250,000, earned by any family making more than $250,000 per year, where either spouse is employed by an institution that received federal “bailout” funds.
It appears that the Senate, and the Obama administration are cold on the bill and that it will not pass, or be signed into law if it did.
I do not earn that much money; nor do my wife and I earn that much together (though in the next few years it is entirely possible that we will).
However, I have something important to say.
If congress should pass any such bill, and the president sign any such law, I WILL NOT OBEY IT.
I will not allow congress to tell me how much I can earn. I will not allow them to take my income because of the actions of others. If they attempt to make me do so by force, I will resist with force.
I will most likely die in the process, which I regret; but at some point a line must be drawn. The constitution must be respected, or it is meaningless.
Congress can make no law that is unconstitutional on it’s face. If such a law be passed, it is the duty of the president to repudiate it; and it must not be signed. If such a law is signed, it is the duty of the agents of the government to refuse to enforce it. If the agents of the state attempt to enforce it, then they must be resisted with force, at all costs.
Anything less is submission to tyranny, and the diminution of citizens, to subjects; or worse.
I would have started back with McCain-Feingold and the Kelo decision, two of the most egregious violations of two of our most basic rights - to publicly support a cause and to own property. But everybody has their own lines in the sand.
Where is yours? What cause do you deem important enough to fight for? Is there anything for which you would pledge your life, your fortunes, your sacred honor?
Results to date, redux
Four days in, and I have a total of three entries so far.
Just to let you guys know, Da Missus and I are heading to Vegas on Sunday morning. I will be taking the laptop so that I can keep track of things ‘round these parts…
The deadline is 8am (Pacific time) on Monday, and I am not responsible for any delays caused by circumstances beyond my control.
Thursday, March 26, 2009
Alice Through the Rainbow
Or Dorothy Under the Looking Glass.
Or “How I learned that Obama and his senior people are fucking idiots”
Timmy “Turbo Tax” Geithner is asking for Congress to create a position that will have the authority to determine whether a business is handling its money appropriately.
Really? Really?!?
The government can’t even sell an ORGASM and make a profit. (Yes, this is old, and I have already mentioned it once before, but I haven’t seen anything that would cause me to reconsider.)
Geithner wants to be able to take over companies that “may have an impact on the economy”.
Really? Really?!?
Isn’t that the frakking point about making a company? To have an impact on the economy, based on skills, abilities and worker efficiency? I know that my little company may not have much of an impact, but by God, it DOES have an impact, and we don’t create anything at all.
Obama wants the government to take over our health care in a nationalized, “single payer” system.
Really? Really?!?
We already have government-run health care, and even government-run hospitals, and they tend to stand out as examples among the field.
Of what shouldn’t be done.
“Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.”—Stuff Thomas Jefferson Wrote, Volume 1
Wednesday, March 25, 2009
Phrases I have never understood
English is a pretty fucked up language, it is true. My step-mother (who was NOT wicked; in fact, she was head librarian at the college where she worked, and taught me the truth: “Librarians are the secret masters of information. Don’t ever piss one off.") taught an ESL (English as a Second Language) course for a while, and told me that English may be wonderfully rich and descriptive, but it is not a language to reason in, nor is it particularly logical.
I was just listening to one of my audiobooks, and the narrator read the sentence, “I stayed on my feet through sheer willpower”.
How else? I realize that the leg and back muscles keep us upright through minor corrections that fall below the level of conscious thought (for the most part), but this is like breathing. The phrase is “postural control”, and is a learned behavior under subconscious control. Babies have to learn to stand upright, and small children are learning how to interact with the world abstracted by their senses (hand-eye coordination).
The act of standing requires a bit of practice, in order to cause the muscles to bunch, flex and contract in a specific sequence that results in a person rising to their feet, even when such actions might be the result of an involuntary reflex (such as that caused by sitting on a tack unexpectedly). But remaining standing requires nothing BUT will power - subconscious willpower in making the dozens or hundreds of micro-adjustments needed to keep the body vertical while using only two supports, or conscious willpower in placing one foot in front of the other into the teeth of the storm.
There are all of the old classics, such as:
- why are they called ‘apartments’ if they are so close together?
- why does one drive on a parkway, but park in a driveway?
- why does your home burn up as it burns down?
- if you send a parcel by ship, it’s called “cargo”, but if you send it by car, it’s called a “shipment”
- If visible and invisible mean the opposite, why do flammable and inflammable mean the same thing?
- if “fat” and “slim” are opposites, why do “fat chance” and “slim chance” mean the same thing?
Tell us your favorites…
Looks like I’m not the only one
Mike over at Cold Fury has found a group of guys who seem to have taken the kinds of things I have been saying to heart. (Not that I am claiming credit for their decisions, but GMTA, and all that.)
Here’s the ad they run…
It doesn’t require the ability to see the future to know where Obama’s plans will end up, just the ability to recognize the signs from the past.
Oath Keepers is an association of currently serving military, veterans, and peace officers who swore an oath to support and defend the Constitution against all enemies, foreign and domestic ... and meant it.
The principle mission of Oath Keepers is to prevent the destruction of American liberty by preventing a full-blown totalitarian dictatorship from coming to power. Our Motto is “Not on our watch!”
The evidence that these guys are right - other than the actual wording of the Oath of Office/Enlistment/Commissioning - is that the soldiers and sailors and police who join do NOT quit on the same day as the individual who holds the office on the day their own Oath was taken. Their service continues, because the Constitution continues, protected from “all enemies, foreign and domestic”. I was honored to serve under Reagan, but I continued serving under his VP, GHW Bush, and for most of Billy Jeff’s first term. I got out for both medical and personal reasons, simply by letting my contract expire on schedule. But I have continued to honor that oath taken, because I think that the Constitution is something worth protecting, even if only by an old cripple like myself. I may not be able to dig a foxhole and live on C-rations while being shot at by theocrats on camels (at least, not anymore), but neither was Benjamin Franklin, and look at how much he contributed. (I think that he was shortchanged by not using his suggestion as to what the country’s national bird should be, but that’s just me, I think.)
“You need only reflect that one of the best ways to get yourself a reputation as a dangerous citizen these days is to go about repeating the very phrases which our Founding Fathers used in the struggle for Independence.”—Charles A. Beard
Truer spokes were never whirred.
Tuesday, March 24, 2009
Cheap, simple economics
This is going to be so simple as to insult the average DW reader, but it’s meant more for the person that has no concept of why the Obama economic plan is going to be problematic.
First, let’s talk INFLATION.
We’ll go ahead and say that Drumwaster has 100 ice cream cones or, rather, he can produce 100 ice cream cones. And, there are 100 people out there that love his ice cream cones because, darnit, Drummy makes a mean ice cream cone.
Now, there is a supply of money out there...let’s say $200...and there is only one rule. That rule is that all the money must be spent on ice cream cones, and there can be none left after all the cones are bought. So, everybody has their $2, and everyone gets an ice cream cone. Nice! Each cone costs $2
Well, Mr. Hopenchange comes along, and throws another $100 into the money supply, and says, “HERE! Have more money!” Now, everyone has three dollars. Hooray!
However, since we have our rule (all the money must be spent on ice cream cones) and no money can be left after the cones are bought, the 100 cones now cost $3 apiece. In other words, your $2 don’t buy an entire ice cream cone anymore. Nothing changed except the amount of money increased. That made each dollar lose value and, therefore, the cost of the ice cream cone increased by a dollar.
There is a finite amount of money in the system (this is called the money supply, and is referred to as M3, M2, M1, and/or M0, all referring to different parts of the same money supply. M1 is all the ‘free’ (immediately spendable) money in the economy at a given time. M2 consists of M1 plus (1) savings deposits (including money market deposit accounts); (2) small-denomination time deposits (time deposits in amounts of less than $100,000), less individual retirement account (IRA) and Keogh balances at depository institutions; and (3) balances in retail money market mutual funds, less IRA and Keogh balances at money market mutual funds. M1 is about $1.56 trillion. A year ago, it was $1.37 trillion. M2 was $7.62 trillion, now it is nearly $8.3 trillion.
The GDP (Gross Domestic Product) is, to be simple, the amount of times the money supply turns over. In late 2008, the rate of money supply turnover (called ‘velocity’
was 1.85, or $14.6 trillion. In our simple economy, the GDP was $200 (and the ‘velocity was 1) before Hopenchange threw the extra dineros into the pot, and $300 afterwards, but in REAL terms, GDP or ‘velocity’ never changed. The individual needed $3 to buy the same thing that cost $2 before. In real life, there is $800 billion dollars more to use, but the economy only grew 1.1% in 2008.
Hence, each dollar is worth less, and you have inflation.
Now, DEFLATION or, as I have heard it referred to, STAGFLATION
Drummy owns a company, let’s say. He sells kilts. Nice ones. In his little town, he can make a kilt for $300, and sell 100 kilts a year for $500 each...the market supports that.
Well, the plant shuts down, and people are out of work. Drummy can’t sell his stock, so he drops the price to sell more units. He still pays $300 to produce a kilt, but he has to drop the price to $400 to sell the amount of kilts he wants to sell, or reduce the amount of kilts he produces and sells. First thing, though, is he drops the price.
Time passes, and the kilt business is slow. He drops the price again. Now, he’s at $350, and he can’t survive only clearing $50 a kilt. So, he reduces his costs by laying off kilt weavers and various Scotsmen. This puts more people out of work, and lowers his need for wool and dye, which causes others to have their hours cut or be laid off. Now, even less people can buy his kilts, so he either has to lower the price, or lower production.
Now, the automobile industry and the housing industry are great examples of deflation at work. Supply is way too large, and sales are way too low. Concentrating on the housing industry for a moment, this means that you either have to lower the price of a house (down 38% since 2006) or lower your inventory (starts down by 60%). Reducing your construction starts affects people in the oil industry (transportation of raw and processed materials), the timber industry, the masonry industry, the heavy equipment sales and rental industry, construction trades, government (permitting, inspections, code enforcement, planning), architects, street construction (concrete/asphalt companies), and probably a bevy of other industries. People in these trades and industries lose their jobs, and can’t buy houses or lose theirs. Either way, inventory isn’t reduced, so prices have to be lowered, or supply needs to be reduced, and it continues until equilibrium is reached.
What the Administration has done is to spur both inflation (by dumping money into the money supply) and deflation (by interfering in the capitalist system by not addressing the real problems, and instead putting money into government expansion as opposed to job creation). It would have been better to forego TARP and TARP II and simply let the market take care of itself.
I think this topic could use some erudite commentary.
Results to date
Only one entry so far, and that one arrived yesterday at 1pm (Thanks, Dave!).
I realize these are tough questions, but I didn’t think they were THAT tough… 