My Good Pal Hugo

Seriously, WTF?????

although I shouldn't complain, this is one of the few things he's done that won't actually HURT the Venezuelan people.

Many thanks to Chris!

People Trust Their Doctor More Than Their Spouse

I found this chart very interesting as it shows you just how much people trust different groups of people. Most shocking is that people trust their doctors more than they do their spouses, but given how divorce has become an Olympic event since the 1960's, I guess I should not be surprised.



Naturally, and deservedly so, employers are ranked at the bottom along with health insurance companies. Though I thought the Po-Po would have faired much worse. Than again, maybe it's just Minneapolis where the cops are completely inept morons and elsewhere the boys in blue have some measure of intelligence (people think I have a grudge against the MPD when in reality, no, seriously folks, don't move here, they really are that incompetent).

To My Former Bosses

What's great is I was informed that some of my former bosses do indeed read Cappy Cap.

So this one is for you guys (you gray haired, middle aged, numb skull schmutzes);

I

TOLD

YOU

SO!

The Captain Will Be In Vegas

Hey All Aspiring, Junior, Deputy and otherwise Official Economists, the Captain will be in Las Vegas this week! Don't know if any of you are out there, but I'm taking a quick break before busy season starts and if any Cappy Cap readers are out there and up for a cocktail shoot me an e-mail!

captcapitalism@yahoo.com

Remember to copy and paste, people keep goofing up the e-mail.

Cpt. C.

The Ladies Just Want Me for My Economist Subscription

Seriously, this is why I love The Economist. In one article the author nails three things I've been saying ever since this blog was formed and are very pertinent to today with all the celebrityship and flak Alan Greenspan's been getting;

1. THERE WAS NO RECESSION IN 2000-2001
2. IT'S NOT THE FEDERAL RESERVE'S JOB TO MAKE YOUR STOCKS AND HOUSE PRICE CONSTANTLY GO UP, IT'S JOB IS TO KEEP INFLATION LOW
3. A RECESSION MAY NOT BE THE WORST THING FOR THE AMERICAN ECONOMY



Just do what I do to pick up chicks, subscribe to The Economist.

Housing Costs to Foreigners

The idea of globalization is that capital can flow freely and various entities can invest in various ventures in various countries resulting in the most efficient allocation of capital around the world, resulting in amazing increases in productivity and efficiency, resulting in dramatic increases in standards of living for everybody. That's about it in a nutshell.

But some countries put up barriers because they're afraid "foreign interests" will buy out their country. The US is just as guilty of this with our denying China from buying Unocal or our fear in the 80's that Japan was going to buy us out. But some countries feel their sovereignty is particularly threated when foreigners buy their land and therefore put very high taxes in place to prevent that from happening.



Something to think about the next time you want to buy some South Korean property.

What You Will Get from Government Pensions as a % of Your Earnings

The trick to getting elected is to tell people what they want to hear and then deliver them the goods.

Doesn't matter if it undermines the future of your country because fortunately (for you) you'll be long dead before that materializes. So you can borrow against the future to promise people today what they want without having to increase taxes, ensuring you have a good, healthy and profitable political career.

And while you may think things are bad here in the US, just be happy we're not Greece;

Another Exciting Episode of "What's Wrong with This Picture?"

Yes, the fun game where those with an keen eye of observation notice things that are glaringly wrong with the picture that are not addressed or acknowledged by the main stream media.

Can YOU see what's wrong with this picture?

Hint: It's not the disgusting fact the father killed his child.

Preferred Offshore Locals

Wow, who would have guessed that no western European nations are on this list.

There is Always Room at the Top

Hedge funds, private equity firms, bulge bracket, these are largely the domains of the well connected, nepotists and cronies. If you weren't born into it, doesn't matter how good you are, they ain't letting you in.

Thus, it feels good when these presumed "champions" suck tail pipe and show that their position is due more to factors outside their control than their actual skill or talent and ability to produce wealth;

Remember, in the long run, old money inevitably gives way to new money because they have no game.

The Republicans are Screwed

I was actually thinking that the Republicans would take back congress in 2008. Call me crazy, but I thought the defeatist mentality would wear thin on the American public, but I underestimated their hatred for Bush and their hatred for the war in Iraq. And I underestimated it by a lot. Apparently the Democrats will trounce the Republicans in 2008, congressional elections and presidential elections as well.



Which means it's a perfect time to vote Libertarian, because seriously, the Republicans are just a lame, if not, quadrapalegic horse to bet on (though Fred Thompson will probably get my presidential vote).

NPR Lying About Chile

I was driving around to some place or another and happened to be listening to NPR. And I do like NPR, they do put on some decent pieces and cover topics that I find interesting and are of importance to the international community, and I take it with a grain of salt because I know they're biased. But what I will not tolerate is when the government media outright LIES and then tries to push itself on the public as some kind of independent or objective media source. And I find it my obligation to point this out and make a record of it.

The story they were covering was how Chile may be the prime example of economic success (are you ready for the "but"?)

BUUUUUUUT

income distribution was uneven (oh the horrors).

Chile, in part due to free market reforms under Pinochet, and now today because of high commodity prices (copper) was experiencing an economic boom, but this boom was only being enjoyed by the easily-accusable villain, "the rich."

And what they do, always, ALWAYS without fail, is grab the one or two poor schumcks out of the tens of millions of people who had a run of bad luck to tow the line, "I haven't benefiting from the economic expansion."

It's probably the most overused play in NPR's play book.

If the statistics and figures don't show the story you want to tell, find the one or two people that have anecdote that does and then present that as the truth and reality of the situation.

And so, once again, it seems it's the people's responsibility to keep the government media in line and point them out to be the liars they are;

First off is the Gini Coefficient that measures income distribution.

Longitudinal data is hard to come by, but I found a report from the World Bank that cites the Gini coefficient has "worsened" in the past ten years in Chile (interesting how they somehow assume income distribution can be "better" or "worse," thereby implying improvement would be a more equal distribution, and following the logic a 100% equal distribution of wealth,ie-communism, must be ideal then). Regardless, this worsening of the gini coefficient had gone from 56.4 in 1995 to 57.1 in 2005.

To provide you with a visual aid I have charted this;


To quote Rush Limbaugh, "well yip yip yip yahoo!"

You've got to be kidding me? Yes, I guess if you want to claim that income distribution has "deteriorated" in the past ten years, you can say that mathematically, but a change from 56.4 to 57.1 is nothing, and probably not even statistically significant. Yet, we're supposed to believe that income distribution is horribly worsening in Chile, to the point that revolution is pending.

Another Jim Dandy chart is to show Chile in relation to the rest of its South American peers;


Oh the horror! It's really no worse or better than most of their peers. Matter of fact, they have more even distribution than South America's two socialist darlings; Bolivia and Venezuela (though in the pursuit of intellectual honesty, these figures do come before President Morales took over Bolivia, so it remains to be seen what income distribution would look like today)

Regardless, we can talk about "income distribution" all day, but in the end, it really doesn't matter. Because what really matters is whether real incomes are going up and that poverty is going down. And in Chile, this has been the case.


If the poor were receiving NONE of the benefits of this economic boom then poverty rates would not be dropping precipitously as they have been. Again, this shows you that if you really want to eliminate poverty, if you REALLY DO CARE ABOUT YOUR FELLOW MAN AND THE POOR then (and I'll say it again, because it doesn't seem like anybody on the left is listening) YOU WILL BECOME THE MOST ARDENT SUPPORTER OF CAPITALISM IN THE WORLD.

I don't know how much easier it can be, but how you can look at the economic history of the world and NOT conclude that the best thing for eradicating poverty is through free markets, then you are ignorant or have a vested interest in socialism. If you look at this and still advocate a Chavezian type of socialism or any type of socialism, then you don't care about the poor as much as you care about advancing your own little political ideology. It is one of the reasons why I have so little respect for leftists because on one hand they claim to be the most devout supporters of the poor, but on the other hand they are too intellectually lazy to actually go and study what brings about the elimination of poverty, let alone advocate it, let alone they actually FIGHT IT.

Sadly, the older I get it seems advocating leftist political ideologies is more of a make-myself-feel-good hobby than their practical, intellectually honest, and genuinely caring capitalist counterparts. Worse still I think about how many people are kept under poverty for a hobby.

Bin Laden/Chomsky '08!

Mock's US foreign policy, calls leaders warmongers.

Sure sounds like Democratic presidential candidate material to me!

;P

Have a good weekend all!
______________

Sorry, had to add this.


HE ENDORSES NOAM CHOMSKY!

But then supports no taxes?

Does he know Chomsky?

Yes, the Terrorist/Socialist platform, that sells well with the American left.

Sucks to be in Iran

Friend of mine sent this to me. Didn't think it was possible.

Here you have a country with (if I'm not mistaken) the world's 4th largest proven reserves of oil. But, besides being a dictatorship, it is also a socialist nation with heavy state intervention in the country. Only a socialist economic system could make it so that the world's fourth largest holder of oil has to import gasoline.

But what is even more pathetic, is that over 1/3rd of Iran's government budget is spend on FUEL SUBSIDIES!


How much of a political issue is the price of gas in Iran?????? It would be like the US spending all of the social security budget AND MORE on subsidizing people's gas. Almost double what we spend on the military. And Venezuela is not far behind.

Just consider these facts before you go accusing out government of being in cahoots with "Big Oil."

Visit Ro!

You all probably know Ro! from his occasional publishings, but you might want to visit his site. He has some pictures from Iraq that you're just not going to see in the MSM. And it's nice to see, for a change, pictures showing that there might be some good going on over there and that our soldiers are indeed not a bunch of raping, torturing heathens.

He also specializes in video clips, which I have yet to dabble in.

Regardless, you shall read Ro! You shall conform!

The Best is Yet to Come

My realtor and I discuss the housing market and we frequently get asked the question, "when is the housing market going to recover."


Not for a while kiddies. Sit back and enjoy the ride.

The Housing Market Making the US More European

Normally, normally the US economy summarily trounces the European economy when it comes to economic growth. In the past I've compared economic growth rates of the two regions to one another and usually the US doubles the rate of economic in Europe. I then point at Europe and guffaw making some comment about soccer or British cooking or something.

However, times are achangin'. With the housing slump now about to enter its first full year, it has taken the shine off of US economic growth, making us, well, more European. Matter of fact, Europe (bar this latest quarter) consistently and by wide margins exceeded US economic growth in the past year.


And as far as I can tell this will continue as long as that housing market continues to loom over the US economy. I better trade my blue jeans in for some crumpets.

How the Economy Can Grow While the Housing Market Crashes

There are two ways to go about cutting back on your gasoline consumption.

The cool way and the nerdy way.

The cool way is to get yourself a motorcycle. Gets great gas mileage (mine gets between 45-52 MPG last I measured), chicks dig it, and you cannot help but look cool on it.

The nerdy way is to get a hybrid. That just screams "pansy." And your mileage isn't even that much better. Reports show a little bit more around the mid 30's in MPG. And no chicks, except them kind of gray haired, aging hippie chicks with no make up who aren't interested in you as much as they are the environment.

Regardless, the drawback to the motorcycle (aside from if you wipe out your either dead or paralyzed) is that you can't listen to talk radio. Oh, I know, I'm sure there's a way, but on my motorcycle I can't, no radio. So it leaves me with a lot of thinking time on the highway as I do more than most environmentalists to cut back on my gas consumption.

The cool thing about this is that when you are working, you are not usually thinking. You are carrying out tasks. Not pondering or scheming a way to come up with a better mouse trap. Thus, this is why the majority of great ideas happen while driving on the interstate, sitting on the toilet, or laying about doing nothing in particular, which is what happened to me yesterday.

I finally figured out why the economy may be growing so great, while the housing market plummets. I was of the opinion that a recession MUST occur at some point in time or another, but now I'm not so sure. The reason why is that while the housing bubble and subsequent crash may even rival that of Dotcom Mania, it really may not have that much of an effect on the larger economy since housing for most people is an expense.

Most of us look at dropping housing prices as a bad thing as the value of our largest asset, our house drops. However, unless you're planning on selling it, its value is largely irrelevant since it is the cash flows associated with the mortgage that you have to pay that matter.

Even if you don't own housing, but rent, the same thing applies. Such a glut in the market in both single family and multi-family means there's a glut of housing no matter if your own or rent. If you own or are looking to own, your options for housing and its affordability have never been better. If you rent, you're able to negotiate landlords down and get discounts lowering your rent expense.

The ultimate end result is that people's largest single expenditure, housing, has decreased, leaving more disposable income in their pocketbooks. This in part may explain why the economy grew at 4%, consumer spending remains healthy and why consumer confidence remains high as well.

Alas, it may just be the banks, mortgage companies and real estate developers that pay in the end...exactly those who deserve to pay.

Good Times with Hugo Chavez

Ahhhh, Hugo.

You funny, inept blowhard.

Terrorism's Real Effect on the Economy

They dedicate their lives to the destruction of the West. They foam at the mouth when they see our power. They hate us because of simple envy and greed and therefore spend every waking hour of their finite lives wasting it by scheming a way to bring about our end. And in their greatest hour they manage to really do...nothing.

I noticed on the GDP per capita chart I posted last week that if you look at it, you see in the grand scheme of things, the terrorists have utterly failed. If their goal was to some how "destroy" the US or "hurt" us, all they managed to do was make us hiccup. For the last "recession" we had was the weakest in recorded history (and by definition couldn't even be considered a recession because of its weakness). And as the 9-11 attack came and went, the US continued on a stratospheric climb in increased prosperity and standards of living furthering the gap between what Western civilization can achieve and what radical Islam offers. In other words the terrorists did absolutely nothing to us, though I say this not to trivialize the loss of 3,000 people on September 11th, but to trivialize what the terrorists did, for they utterly failed.


And sadly, for the terrorists they can't even claim to have even caused that economic hiccup. Chances are that "recession" was due more to the collapse of the Dotcom Bubble than it was the terrorist attack, making the attack more like a mosquito bite than a wasp sting.

Regardless, I just wanted to point this out to all of you aspiring, junior, deputy or otherwise terrorists out there. You have a choice, you really do. You can go ahead and subscribe to this "hero" syndrome and go on some epic crusade to "kill the infidels" which basically means you're going to throw your life away for no purpose aside to give the West a hiccup, or you can go and live your own life and do what you want.

Who knows, you might even find out you like life and enjoy it.