Mother Nature Strikes the East Coast

Irene, a category 3 hurricane, is headed north-by-northwest, towards the United States east coast at this hour, packing 115-mph winds.  It is expected to hit the eastern seaboard this weekend from the Carolinas to New England.  All the advisories, watches and warnings have been issued by all the emergency service organizations.  Airlines have begun cancelling flights and moving planes out of harm's way.  Coastal residents are boarding up their homes and businesses.  U.S. Navy vessels homeported in Norfolk, Virginia have put to sea to "ride it out."  Governor Andrew Cuomo has already declared a State of Emergency for New York.

Of course, category 3 hurricanes that make landfall in populated cities will always make history, but we must particularly include Irene in this blog because it comes on the heels of a magnitude 5.8 earthquake that rocked Washington, D.C. just two days ago.  As the largest earthquake to strike the east coast in 67 years, it also could be felt as far away as New York, though causing only minor damage to buildings and monuments.  Nonetheless, Mother Nature appears to be having quite a summer with the eastern seaboard of the United States.

This blogger anticipates a number of explanations for this.  Some will claim, if they haven't already, that these two natural disasters are an example of the global climate change.  Others might believe it's God's way of punishing Washington D.C. for not resolving its debt and budget issues.  Such is the result of the human propensity to ask why these things have to happen.

Whatever the reason, our thoughts here regard the safety of everyone in that part of the country.  Take care, you guys.

Let the Oil Flow

February 17, 2011, Al Jazeera:  "Protesters in Libya have defied a security crackdown and taken to the streets in four cities for a "day of rage,"

February 21, 2011, guardian.co.uk: "Libya uprising forces oil price to highest point since 2008"

March 19, 2011, New York Times (World):  "American and European forces began a broad campaign of strikes against the government of Col. Muammar el-Qaddafi on Saturday, unleashing warplanes and missiles in a military intervention on a scale not seen in the Arab world since the Iraq war."

March 27, 2011, guardian.co.uk: "Libya:  NATO takes full control of military operation"

June 1, 2011, Al Jezeera:  "NATO has agreed to extend its military campaign in Libya until late September, keeping up pressure on Muammar Gaddafi still in power after 10 weeks of air strikes."

August 22, 2011, Reuters:  "NATO said it won’t curtail its five-month air campaign over Libya and will monitor any remaining threats posed by Muammar Qaddafi's military forces as rebels seeking to topple the 42-year regime swept into Tripoli."

August 22, 2011, New York Times (World):  "Col. Muammar el-Qaddafi's grip on power dissolved with astonishing speed on Monday as rebels marched into the capital"

August 22, 2011, New York Times (Business): "The Scramble for Access to Libya's Oil Wealth Begins"

'Nuff said.

Sunday Summary

Let's face it--the economy sucks, right now.

Most of us are aware that it doesn't help matters to say this.  After all, the prime mover for consumer economy is confidence, and to admit that the economy sucks is only likely to make it worse by deflating the confidence that everyone has that it's going to get better.  It may still, and will, hopefully, get better, but right now, it ... well, it's really tanking.

All most of us need do is take a look around them, if it hasn't effected them directly, already.  Especially here, in California, rents are up, houses are being foreclosed upon, small businesses are going under, "For Lease" signs are going up, people are struggling to find work, and are ever more thankful that if they have a job.  In the broader perspective, we hear more bad news, every day--the stock market is falling, unemployment is rising, the government has been spending ever more money to spur economic growth, so the national debt is through the roof, and all while the price of just about everything goes up.

Economists and bankers are only now beginning to suggest that the "risk of recession" is now "very great".  In an interview several days ago, President Obama said that he "doesn't think that the U.S. economy is in danger of falling into another recession."  But, seriously, who are these people kidding?  Have we even yet to really recover from the 2008 recession? 

Peter Schiff, an American investment broker, author, financial commentator, and former contender in the 2010 Republican Connecticut Primary, believes we're in a depression.  What gives him the confidence to make such statements is the credit he received from those in the financial world for noticing and commenting on the sub-prime housing "bubble" back in 2006, long before anyone realized it was even a bubble. 

If Schiff is right, it's very, very likely that the economy is going to get much, much worse before it ever gets better.  To him, the Federal Reserve is running a Ponzi scheme, effectively sanctioned by everyone; that Ben Bernanke is going to continue to print money until it becomes so devalued that it will collapse.  As it was during Germany's Weimar Republic, it will take barrowfuls of money to buy a loaf of bread.  And only those who have gold or silver, (used as money for millenia), will have any real purchasing power.  This prognostication is echoed by growing number of others in the public sphere, including Republican Presidential candidate Ron Paul.

Those of us who study history are not in the business of making prognostications.  However, we still have to feed our families, and to that end, it behooves us to have an understanding of the current economic climate.  Moreover, one of the very reasons to study history, and indeed, one of the reasons we began this blog, is because, in the oft-quoted phrase, "those who cannot remember the past are condemned to repeat it," and most of us, we're sure, wish not to have to live through an economic depression, if history is any guide.