Failed Aid

If there is a distinguishing characteristic between those of lefter leaning stripes and those of righter leaning stripes it's that those on the right seemingly and callously only care about results, those on the left care about being nice or polite. Those on the right are the harsh fatherly figures that incentive performance by threat of punishment. Those on the left are kind, forgiving mother figures that incentive performance by rewards and puppies and flowers and unicorns, but it's not necessary you achieve performance, but that you try.

Now while the world needs both it seems the fatherly approach to problem solving is being outlawed and banned as it is too blunt and mean.

And that's a pity because usually the best thing people need is a swift kick in the ass or to have some kid point out the emperor has no clothes. It's an additional pity when for political reasons, ignorance or just being brainwashed into political correctness, we ignore problems in fear that if we address them directly then we'd be accused of being cold hearted, sexist, racist, evil, mean, or just a plain old poopey person. It's a tragedy when 600 million people's lives are on the line and we can't admit we goofed up and change tactics because the resulting change in tactics would be deemed politically incorrect.

Case in point, Africa;








Now I don't have time to go on about how much we've spent in aid and debt forgiveness, estimates I've seen range from $650 billion to $1.5 trillion. But can we at least admit that this leftist-originated "let's all send them money and aid" schtick ain't working? Can we just for once put the actual livelihoods of Africans ahead of our desires to feel warm fuzzies about ourselves because we "tried" (even though it's seemed to make them worse off)? This isn't a hobby folks, it's other people's lives, which is why it's good to see charities like the Bill and Melinda Gate's foundation attaching strings to their aid. If we can admit that, I'll admit things aren't working in Iraq...but that's just because I have this horrible knack for accepting reality. Do you?

Make the Canadian Tax Payer Pay

Don't know if it's true, and maybe some of you Canuck friend up north can tell me, but this angers me and it isn't even my country.

If it is true, how much you want to bet he's of the political belief that tax payers should pay MORE in taxes (so he can get a better bottle of wine supposedly).

"Meanwhile, at the Federal Reserve..."

So you would think the people who visit the Federal Reserve's website would be of the slightly highly educated caliber. The types that are pretty in tune with the realities of today's economy. The types that can objectively look at data and not let their personal biases or wishes affect them.

Well, I guess I was wrong.

They have a poll you can take that asks where you think housing prices are going. I took it, expecting to see a large majority predicting housing prices to go down. When you looked at the results, however, the majority of people think prices ARE GOING TO GO UP!

Here's the poll;

http://www.stls.frb.org/Poll/PollQuestion.cfm?QID=16

Of course only 88 respondents had taken the poll when I took it, but it would be Cappy Cap Terrific if all you deputy, junior, official and otherwise aspiring economists would take the poll and give them you opinion (plus that would just be sweet if the Federal Reserve saw where the hits were coming from, and then they'd call me and say, "Captain Capitalism, the Fed needs you!" Whereby Ben Bernanke and I would work out some kind of deal like Commissioner Gordon and Batman had where they'd send up the Captain Capitalism signal and I'd be the silent protector of the Fed...hey, it could happen!)

Regardless, I found the poll interesting because embedded in nearby research at the Fed they have this chart;

My research shows that prices would have to drop by about 20-40% to get back in line with historic means. Their research shows the same. However, look at California and Florida. Sheesh! The country might not get hit with a recession, but I have a hard time seeing how California and Florida won't.

My Pal Al

Like I said, sure no doubt I'll suffer economically from a recession, but I like being right;

http://business.guardian.co.uk/story/0,,2077886,00.html

How much you want to bet that when the economy does go into recession they'll blame it on Bush and not the millions of sub prime losers that went and indebted themselves with the help of willing-accomplice banks that triggered the housing bubble?

Holy Old Chart Batman!

As a kid I used to go through my dad's church's old file bins and find old, I mean really old, church bulletins. It was a nerdy kind of neat to see if I could find old fliers that hadn't been handed out since 1963 and what kind of art/style was on the brochure. And so I found a couple of these charts which are kind of neat in that same nostalgic sense, economic charts from the 1970's.

No aid of computers or Excel, it seemed this stuff was done by hand maybe? I can't tell, but it was no less advanced. I could only imagine how long it would have taken to craft a chart like this.

Death to the Private Sector!

I attribute a fair percentage of Captain Capitalism’s origins to Mike Hodges and his Grandfather Reports. Many times I’d be researching for a particular chart or data stream and Mike would show up more than just once.


Pity more people and politicians don’t listen to him. If they did, then we wouldn’t be condemned to end up looking like Italy or Sweden 20 years from now.

And the Winner Is...

AMAZING PETE with his chart that showed those who paid the highest in taxes also voted for John Kerry. Giving further credence to my theory that it has nothing to do with hating GW or the war or abortion right or social right, but socialism is all about the money. Don't let anybody tell you any different.

Pete wins;

$15 of the Captain's hard earned money
A signed photograph of the Captain
and
The Captain's ENTIRE instructional DVD suite, retail value of $60! (I've just wanted to say that)

I think I may have deleted Pete's e-mail, but if you could e-mail me Pete with your address at captcapitalism@yahoo.com (remember to copy and paste) and you will have your prizes mailed out as soon as I get off my lazy ass and mail it.

CONGRATULATIONS!

Money Equals Happiness

And if anybody else tells you otherwise, ask them to give you all of their money since it isn't making them happy.

The Banks Will Pay

Oooooh, will they pay.

And they deserve to pay.

The idiocy I've seen in the past 4 years is unbelievable. How banks will gladly throw quality out the window, ignore credit, and finance the most outlandish ventures just to keep sales going like it was 2004. How they will bend over backwards to finance a $10 million real estate deal because they get a 1% commission even though that deal stands a nice-guy's chance of scoring with a girl in college than ever paying back the money. And how they're so desperate to keep the top line of the income statement going up they've lowered their standards to pursue sub-prime people with credit scores of 550 or less which as they're finding out is driving their bottom lines down.

And now the time has come for the housing market to collapse and to slowly erode what banks have been lending on this entire time, real estate.

It was about 4 years ago now that The Economist pointed to the possibility of a housing bubble. I often opine if these financial institutions had hired an economist, or heck, just read the freaking Economist, just how many hundreds of billions of dollars would have been saved, not to mention the more-than-likely-recession we're about have would have been staved off. But the banks have been so obsessed and addicted to the sales growth of 2001-early 2005, they just can't stop and consequences be damned. Like heroin addicts, like Gene Hackmann in The French Connection, they're rabid for new loans. And they don't care about the quality of the loans, they just want volume.

Of course there is a penalty for ignoring the long term consequences for short term gain. As housing prices drop the collateral these banks are holding will become impaired (I even remember recommending to a client that they change their advance policy from 80% appraised value of real estate to 70-75%, I was laughed at). And as these values go down their clients, who are all already over-leveraged to begin with, well be unable to unload the glut of property they now hold and therefore pay back the loan.

Addtiionally, an emergency back up measure for these instances is also no longer available. Primarily used by gluttonous, lazy, non-working "millionaires" is if they couldn't sell the property, in order make current loan payments was to borrow more money from the property as property prices went up, giving them more equity to cash out/bleed out of the property. Well when prices stagnate or go down, this technique won't work.



Thus what is going to happen is the banks are going to be left holding the live grenade. They will be holding a vast portfolio of real estate that they can't unload...or at least unload to cover their original loan amount. And they might as well not even bother repossessing because they'll do no better job selling it than the developers and bulders themselves would. And so they get to play "Japanese Bank Circa 1980's, "perpetually financing a zombie real estate industry that has no hope whatsoever of repaying them back.

The question is how exposed are banks to real estate and thusly how big of a problem this will be for the banks in the next 12 months? I mean, certainly banks have been wise enough to diversify their portfolios. Spreading it across industrial loans, agricultural and other sectors of the economy. Certainly these highly educated and experienced financial gurus would follow this basic "Principals of Finance 101- Diversification" rule? Right?



(I do know that I did adjust the scale on the left side, which I normally am against, but the average was 44% and I just wanted to show how much of a deviation occured from norms)

The piper SOOOOO has to be paid.

And it would have been a lot cheaper to pay an economist.

The Adult Won in France

Good to see the French are tired of having little children in office whose main pillar on their platform is "we hate America" and "let's bribe criminals not to destroy the city" and "35 hour work weeks." Yes, Royal's "let's reward rioters with cake" approach was sure to have solved the problem. Something tells me Sarkozy is going to abandon the nice motherly approach and deliver a more spanking-filled fatherly approach.

I also like the first pro-American words I've heard from France since I've been alive come out of France. Who knows, I might just actually go visit France now! I might even stop slamming on the French!...well, let's not get crazy.


Daddy's home!

Death to the Polar Bears

The strongest arm and biggest weapon of the socialists is the public schools combined with indifferent parents. There they indoctrinate young kids whose parents originally had the kid as an SUV Baby, a thing to have, and really don't care about the kid beyond that, and therefore as long as the government keeps those kids out of their hair so they can pursue their careers thats fine. Thusly, the socialists get to have fresh, brainwashable troops to send out into the real world, and it's only through truly independent thought or an intervention on the part of a smart uncle or friend that these brainwashed dolts are shown the realities of real world economics and they turn into capitalists.

But what I find particularly disgusting is how socialists are so low, so utterly moraless they find nothing wrong with foisting their political agenda on little innocent children. I've argued before that childhood is such a sacred time in a person's life that it shouldn't be destroyed or even tarnished with some granola crunching putz (nor right wing nut job) trying to jam an anti-smoking or all-organic ideology down some poor kindergartner's throat just to get their psychological jollies that they're somehow doing their part to save the world. I would also level the same, arguably more scathing critcism against parochial schools doing their darndest to save these kids from eternal damnation while making their time here a living hell. Childhood should be void of politics and religion all together, but oh no, these crusaders who have nothing of worth to point to or have done not one damn thing to truly advance society need to feel good about themselves so they're going to go and "save" a 6 year old. Cripes.

Which is why this chart set me off. To find out that the polar bears are indeed not dying, BUT ACTUALLY THRIVING AND GROWING!!!!


Nor did I know polar bears were so far south along the Hudson Bay!

Captain Capitalism's Annual Chart Contest - from Rob

And I don't even believe that since nobody is following the Kyoto protocol and China and India are going to dwarf the developed world by 2090.

Bush's Fault!

Just wait for it. Wait. Waaaaaaiiiit! It's coming.

The Housing Market Follows the Stock Market?

This was a little chart I picked up recently. I extrapolated it a little further for I had not the time to track down both data series.

Something tells me with GDP slowing down, sales at corporate America are going to stagnate and we're going to have a little correction in the stock markets as well as the housing markets.

And you know whose to blame for all this?

That damn George Bush.

Why You Shouldn't Listen to Your Stock Broker

Martin had a good one.


Shows why the majority of people who go and get their degrees and MBA's in finance and then go on to be some kind of big time stock broker that claims to make millions in the stock market end up like the guys at Long Term Capital Management or end up selling their "guaranteed way to make a fortune in stock options.

(Hat tip to Martin for the error calling it "Credit Management")

Lot's O' Death

The source is questionable.

Captain Capitalism's Annual Chart Contest - Entrant #9

Kevin makes a good point with this chart.

I often wonder if we'd have the wherewithal today to fight in WWII. Sadly, I think we'd collapse and capitulate just as fast as the French, because, hey, being alive and enslaved is better than being free and dead? Right? I recall somebody saying something about liberty or death in American history, but ah, what did those dumb American founding fathers know anyway? Cripes.

I Need to "Grow Up"

"These men are the real life versions of Peter Pan, flat-out REFUSING to grow up and act their age. And even worse, these are the guys that will string you along the most. The point is, Megan K. and I are on the brink. The precipice of spinsterhood. A No-Man's Land (literally). We want to find The One, settle down and get married (and, for me at least, have babies). But all we're finding is guys who are simply wasting our time."

Holy Super Awesome Powerful Rationalization Hamsterl, Batman! Quick! Let me;

1. Throw away my motorcycle.
2. Give up my freedom
3. Forfeit my 2 months a year of vacation
4. Work twice as hard to pay for her and the "babies"
5. "grow up" and "act my age" by marrying this girl
6. for a 45% chance of NOT getting divorced

Eeeeyish! To quote Rodney Dangerfield;

"Now I know why some animals eat their young."

She even has a neato chart!



What I get a kick out of is what they bring to the table;

"You see, Megs and I -- as well as a plethora of our other fabulous female friends -- find ourselves in a precarious and perplexing position: We're cute. We're smart. We're articulate, well-traveled (her more so than me), energetic, fun and down to explore. And yet, at 29 and 28, respectively, we are still single -- standing on 30's lonely doorstep -- with ZERO reasonable prospects."

Little do they know men would like to hear;

"I am an engineer and Megs is an accountant. We support ourselves and actually are independent. We like to drink and want to find a guy who does his own thing and isn't just an accessory to us or a means to have children that we will value more than him. We want to fall in love with a wonderful man and maybe start a family."

Not the overplayed, "Well, I like to travel."

Run men, run. Keep those courting Spidey Senses VERY sharp to avoid the fates these ladies bring.

As always a reliable and funny hat tip to Dalrock.

Enjoy the decline!

One Simple Question

With property prices going down, does this mean municipal and local governments will be lowering their property taxes?

HA HA HA HA!!!!!!!!

Oh, I kill me sometimes.

Captain Capitalism's Annual Chart Contest - Entrant #8

This is from Kenza, an engineer that was finally persuaded to submit a chart after I offered my DVD suite of instructional dance class videos in addition to the $15 and a signed photograph for the grand prize of the winner of the chart contest.

She highlights what is a legitimate criticism of the economic recovery post stock market crash/9-11, in that it was slower than previous ones. This much is true, but the last "recession" we had was nothing. There was not that big of a valley to climb out of, additionally average wages for your average earner didn't really recover significantly until 2006. I would be curious to see if these charts were extended one year.

Regardless, a potential winner in the chart contest!!! (and yes, the fact she's female does have an increasing chance on her winning ;P JUST KIDDING!)