DoomwatchTM vs. Timesizing®
Collapse trends - June, 2003 + May 31
[Commentary] ©2003 Philip Hyde, The Timesizing Wire, Box 622, Cambridge MA 02140 USA (617) 623-8080 - HOMEPAGE
6/28-30/2003 surfin' those headlines from hell -
6/27/2003 surfin' those headlines from hell -
- 6/30 Pessimism pervades industry session - Fund managers predict grim market conditions, agree on Treasurys [sic] bubble, by Ian McDonald, WSJ, C17.
CHICAGO - ...a [mutual-fund] industry gathering here Friday [6/27]....
- [and part of the reason -]
6/29 Major indexes fall as investors grab profits, by Jeff Sommer, NYT, 3:15.
6/28 Outbreak of profit taking snaps June winning streak - Dow loses 89 points to close below 9,000, AP via NYT, B4.
- [and another part of the reason -]
6/28 Lucrative deals for executives tie the hands that pay them, by Patrick McGeehan, NYT, B1.
6/26/2003 surfin' those headlines from hell -
- Ahead of the tape... - The fine print, column by Gregory Zuckerman, WSJ, C1.
Tucked into yesterday's downward GDP revision was this beauty: Capital spending dropped at an annualized pace of 4.8% during the first quarter.
Want more? Capital spending is down 14% from late 2000.... New orders for non-defense capital goods...pretty reliable predictor[s] of near-term spending, also have been falling. Companies are willing to spend to keep equipment and operations running, springing for an extra toner cartridge, but that's about it.
The Fed's nightmare, of course, is consumers finally put their wallets away, as they await lower prices [more likely if they run out of jobs & credit], while business borrowing stops in its tracks with companies finding little to invest in. That "liquidity trap" [evidently the new kosher term for "depression"] has taken hold in Japan's economy, and it hasn't been pretty.
There are some signs of the ugly trend over here, as...despite the plunge in interest rates during the past year..\..banks find fewer companies interested in borrowing money...to expand their businesses. [Hey, why would businesses want to expand? - they're experiencing soft markets.] It hasn't helped that banks have tightened lending standards. [Shades of the 1930s. This is a seldom-mentioned factor that offsets the effectiveness of interest-rate reduction. Why would banks want to do riskier and riskier loans for lower and lower interest rates?] Sure..\..the spate of [corporate] convertible-bond offerings shows no sign of slowing [but] companies...are heading to the bond market to raise money [merely] to refinance existing, higher-rate debt or to replenish ailing pension plans.
...Lower interest rates are nice, but the economy got into this mess by the unwillingness of companies to step up capital spending," says John Lonski, chief economist at Moody's Investors Service.
[More likely because of their unwillingness to step up or even maintain payroll spending, and when you cut payroll, you cut consumer base. They should have been timesizing, not downsizing - trimming hours rather than chopping jobs - all along the way, and markets would be burgeoning.]
A bit of upbeat news: Companies again are interested in mergers.
[That ain't upbeat, that's a knell, that's summoning the economy, not to heaven, but to hell (apologies to Macbeth). Mergers are just appetizers to consolidation & downsizing & more shrinkage of consumer markets. Is it really that hard for guys like Zuckerman to connect the dots?]
That could mean more spending.
[Not bloody likely.]
While capital orders remain pathetic, the backlog is growing.
["Excess inventory" - another big symptom of depression, oops, "liquidity trap" or what we call the Black Hole economy with that "Big Leak Upwards."]
"I get a sense financial stress has eased and that has to happen before spending starts again," says James Glassman, J.P. Morgan Chase's economist. Let's hope so.
[Dream on. If capital spending does start again, it will be just a replay of the great Internet bubble of the late 90s. See Krugman, "Still blowing bubbles - Leaping market, invisible recovery," 6/20/2003 #1 below.]
- [besides, speaking of bonds -]
Stocks rally slightly; Bonds' 2-day fall is sharpest in 2003, by E.S. Browning, WSJ, C1.
- and despite the good news today (6/27/2003) including freedom from telemarketers & more freedom for gays, here are a couple of curtailments -
- AFL-CIO complains, by John Harwood, WSJ, A4.
that Bush administration revoked its paid reservation for use of the Labor Dept. auditorium after learning the planned event would blast the administration's stance on eligibility for overtime pay.... [our italics]
[So much for freedom of speech in America. It's been redefined to mean only the freedom of the super-rich to give unlimited contributions to the America-fragging candidate of their choice.]
- Cry freedom: Bush asks U.N. to lift environmental scrutiny from Yellowstone, by John Harwood, WSJ, A4.
[Our slant on this freedom - freedom from trail erosion and air pollution - is the opposite of Harwood's.]
The administration will seek to remove the national park from a list of endangered "World Heritage Sites "at next week's meeting in Paris of the UN Education, Scientific & Cultural Organization [UNESCO - even though] the National Parks Conservation Assoc. [says] snowmobilers and a coal-powered plant pose continuing threats.
6/21/2003 surfin' those headlines from hell -
- Very richest's share of income grew even bigger, data show, by David Johnston, NYT, front page.
The 400 wealthiest taxpayers accounted for [1.1%] of all the income in the United States in the year 2000, more than double their 'share' [our quotes] just 8 years earlier [0.5%], according to new data from the Internal Revenue Service [IRS].... The data, in a report that the IRS released last night, shows that the average income of the 400...was almost $174 million in 2000.., nearly quadruple the $46.8m average in 1992....
[The NYT has buried material in the third-last paragraph that should be at the front, so here it is -]
Over the nine years reviewed in the new report, the incomes of the top 400 taxpayers increased at 15 times the rate of the bottom 90% of Americans, [whose] average income rose 17%, to $27,000, from 1992 to 2000..\..
[The "bottom" NINETY PERCENT only averaged $27000 and gained only 17% while less than the top ONE PERCENT gained 17x5= 85%??? No wonder we have no robust domestic markets! Back to their beginning -]
While the sharp growth in incomes over that period coincided with the stock market bubble, other factors appear to account for much of the increase. A cut in capital gains tax rates in 1997 from 28 to 20% encouraged long-term holders of assets, like privately owned businesses, to sell them, and big increases in executive compensation thrust corporate chiefs into the ranks of the nation's [plu]tocracy....
[This nation does not have an aristocracy. Does this story really need embellishing?]
The data from 2000 is the latest available from the IRS, but various government reports indicate that salaries, dividends and other forms of income have continued to rise since then, even as the stock market has fallen..\..
But their tax 'burden' [our quotes - as if any 'money out' is a 'burden' at those levels] grew at a much slower rate...to 1.6% in 2000 when their tax bills averaged $38.6m each, from 1% of all taxes in 1992. [Also,] this year's taxcut reduced the capital gains rate further, to 15%....
Those numbers can be read [by flat taxers] to show that the wealthiest, as a group, carried a disproportionate [portion - talking about "share" in this context is ridiculous] of the overall tax burden - 1.6% of all taxes [including Social Security taxes which, though "flat," stop completely at $65,000???] versus just 1.1% of all income....
In 2000, the top 400 on average paid 22.3% of their income in federal income tax, down from 26.4% in 1992 and a peak of 29.9% in 1995.
[This is a very shortsighted "peak," considering the graduated taxrates prior to 1963 when the Democrats(!) started flattening them.]
Two factors explain most of this decline, according to the IRS : reduced tax rates on long-term capital gains and bigger gifts to charity.
[This last factor requires explanation, because of all the articles recently on the reduction in gifts to charity - which we believe started well before the stock bubble collapse.]
Had pResident Bush's latest taxcuts been in effect in 2000, the average tax bill for the top 400 would have been about $30.8m - a 'savings' of $8.3m, or more than 20%, according to an analysis of the IRS data by The...
[evidently in the jump from page A1 to C2 the NY Times omitted some material. Lord, they can't even get the basics right on the most important article they've had in years! It picks up on page C2 with -]
rate of 17.5%.
The rate actually paid by the top 400 in 2000 was about the same as that paid by a single person making $123,000 or a married couple with two children [making] $226,000, according to Citizens for Tax Justice, a labor-backed group whose calculations are respected by a broad spectrum of tax experts. ...Its director, Robert McIntyre, said yesterday that [the top 400] "are the guys Bush wants to help, even though they have so much money they don't know what to do with it."...
[If they did know what to do with it, they wouldn't be stuffing it into the stock market and inflating P/E ratios far above historic norms. In fact, they have concentrated such a huge proportion of the nation's income that they are actually suctioning the markets away from the productivity they're invested in.]
William Beach, a tax expert at the Heritage Foundation, a 'conservative' organization [our quotes - we dispute that description]...said that...cutting [their] taxes...will prompt the wealthy to invest more in the economy's growth.
[Not if they want returns on their investment, which require there be sustainable markets for the products or services they're investing in. As the national income concentrates, the number of enterprises that it can be sustainably, let alone profitably, invested in, gradually shrinks. Are there any economists who are researching this vital issue?? Or are they all busy happytalking to prop the increasingly unbalanced, top-heavy status quo? Or just distracting themselves and us onto secondary or downright trivial issues, as Prof. Alan Krueger is doing today? See 6/26/2003 #4.]
All of the IRS data is based on adjusted gross income, the figure reported on the last line on the front page of individual income tax returns. Interest earned on municipal bonds, which are exempt from tax, is not included.
[And you better bet that they've got a huge proportion of 'their' holdings in those single- and double-tax-free bonds.]
Over the nine years of tax returns that were examined for the new report, only a handful of taxpayers showed up in the top 400 every year, according to IRS officials....
[Which could just mean that they've become more devious at hiding their income. Oops, here's indirect corroboration, in addition to the omission of munibond interest -]
The figures do not include the incomes of the many wealthy Americans who use shelters to reduce their reported incomes below the level of the top 400..\.. The [lowest average] income [on the top 400] list was $86.8m in 2000, more than triple the...$24.4m...in 1992....
[We have replaced "minimum income" with "lowest average income" because inclusion in the list was determined by being in the highest 400, not by having some "minimum" average income. Sloppy writing in the NY Times rolls on.]
A second report that the IRS will make public today shows that the number of Americans with high incomes who pay no taxes anywhere in the world has reached a record. In 2000, there were 2,022 Americans with incomes of more than $200,000 who paid no income tax anywhere in the world, up from just 37 in 1977, when the report was first issued..\..
In all, about 2,200 taxpayers [showed up at least] once [on the top 400 list]. There were a few incomes of more than $1 billion a year in the group, but none as high as $10B. The names of the wealthiest taxpayers were not disclosed in the report, which was prepared by Joel Slemrod, a UMich B-school professor who serves on an IRS advisory panel and is a leading authority on taxation of high-income Americans....
Long-term capital gains accounted for 64% of the income of the top 400 in 2000, nearly double the level in 1992. Wages contributed [only] 16.7% to the incomes of the top 400 in 2000, down from 26.2% in 1992, and dividends made up 2.8%....
[So much for even for "work hard to get ahead," let alone "work smart, not hard." The fact is, the parasitism at the bottom of the income scale is dwarfed by the parasitism at top.]
- Four signs stocks may be near a peak, by Jeff Opdyke, WSJ, D1.
...At least four indicators seem particularly worrisome.
- Corporate profits aren't expected to grow rapidly until at least early next year.
[Dream on. That would require MARKETS, and our numb CEOs are still downsizing, not timesizing.]
- In May, the amount of debt taken on to buy stocks increased nearly 8%, the biggest such jump since the market's peak 3 years ago - a sign that investors may be getting irrationally exuberant again.
[Boy, is that stupid! = borrowing money to buy stocks = dumba dumb dumb]
- Huge sums of money are flowing back into stock mutual funds for the first time in 18 months.
[More worrisome than that is "Investors add $18.6B to money[-market] funds," Dow Jones via WSJ, C16, meaning there are a lot of people who will be satisfied just to keep their principal safe.]
- And bearish sentiment is at its lowest level since early 1987, just months before a major market crash, according to Investor's Intelligence, which polls market-newsletter writers....
- U.S. economy slows growth across Canada, by Bernard Simon, NYT, W1.
[That blinkety-blank U.S., dragging back spunky, get-ahead Canada!]
6/20/2003 surfin' those headlines from hell -
- Massachusetts Legislature repeals Clean Elections Law, NYT, A14.
...after voters approved it overwhelmingly in 1998....
[Thus simultaneously blocking the two and only two avenues of political-economic progress - campaign finance reform and referendums. Insofar as Massachusetts is an indication of what's ahead for the nation at large, the USA is basically finished as a world leader. If not even Massachusetts, swarming with progressive and educated Democrat and Republican citizens, can control their own elected officials, a stifling majority of whom are misnamed "Democrats," then American "democracy" is truly doomed, bankrupt, kaput, washed up. Anybody with any self-respect or concern for the long-range future is making plans to bail out of the big-money-drowned American ship that's so rapidly sinking to Third-World levels, and move to Canada (or even Iceland!).]
- [but there are a lot of self-destructive people even in Canada -]
Violence, bureaucracy hobble Canada's struggling fisheries, by Colin Nickerson, Boston Globe, front page.
[No, first greedy, then desperate OVERFISHING is hobbling Canada's struggling fisheries - and that's being compounded by some really stupid politically-correct government meddling, like transferring (over-!)fishing licenses from EuroCanadians to aboriginal Canadians - as if it matters which race brings about the extinction of the next string of species now that the cod etc. fisheries are history. It all comes down to jobs, and 'jobs' comes down to switching from (40hr/wk) job creation and downsizing to worksharing and timesizing, the sooner the better.]
6/19/2003 surfin' those headlines from hell -
- Still blowing bubbles - Leaping market, invisible recovery, op ed by Paul Krugman, NYT, A25.
...The bulls think..\..the big rise in the stock market...is about to take off. But I think it's a sign that America is still blowing bubbles - and a 3-year bear market and the biggest corporate scandals in history haven't cured investors of irrational exuberance yet....
Don't taxcuts and low interest rates create the conditions for an economic rebound? Well, interest rates have been low for a while. And everything that has happened since 2001 suggests that Bush-style taxcuts - which, because they [favor] the very affluent, basically give people with plenty of cash to spare even more cash to spare - provide very little employment bang for the deficit buck....
Meanwhile, the average stock is selling at 31 times earnings, twice the historical norm, [so] investors' big move back into the market has been driven not by careful comparison of returns, but by the fact that stocks are rising -
[and where else are they gonna put their mountains of cash (= "liquidity-driven rally").... So -]
The new bull market isn't forecasting anything; it's just feeding on itself....
Maybe a vigorous, though still invisible, economic recovery will deliver the sustained, double-digit earnings growth that analysts - apparently not chastened at all by recent history [c'mon, Paul, cheerleading is their job!] - are once again predicting. But even if that happy scenario comes to pass, it's hard to justify current stock prices - because if the economy booms,
In short, the current surge in stocks looks like another bubble, one that will eventually burst.
- the low interest rates that might conceivably make the stocks worth buying at 30 times earnings will soon go away.
- If and when businesses start borrowing again, they'll have to compete for funds with the federal government, which will be running $400B-plus deficits as far as the eye can see.
- Meanwhile, foreigners won't keep lending us $500B each year; in fact, private investment inflows into the U.S. have already dried up.
[See today -]
Foreign investment in U.S. plunges nearly 80%, by Christopher Rhoads, WSJ, A6.
- ...The banana-republic policies now being followed in Washington won't just drive up interest rates; they'll probably generate a full-blown fiscal crisis one of these years. That can't be good for equity prices.
[And when not only the "radical" Krugman is saying it today, but the "conservative" Journal -]
For some, tech-fund rally recalls bubble era - Tech fund get air, but could wipe out, by Ian McDonald, WSJ, C1.
- [and for all the little spurt of orders it recently got from, was it Qatar? - Boeing still has its hand out -]
Boeing to seek financial aid - Commercial-space woes lead to talks with Pentagon, by Andy Pasztor, WSJ, B4.
- [and now that our software industry is hemorrhaging jobs to Bombay, more 'dandy' news for the U.S. (& Japanese!) economy -]
Carmakers around world are turning to India for parts, by Saritha Rai, NYT, W1.
[as low wages take over...bringing weaker consumer demand in their wake.]
6/17/2003 surfin' those headlines from hell -
- [Revenge of the Sociopaths I -]
House votes to eliminate the federal estate tax, pointer digest (to A18), NYT, C1.
...the third time in a month that Republicans have approved a large taxcut bill over objections from Democrats that the government is being deprived of its lifeblood. Republicans said the measure would keep family businesses from dissolving to pay the tax upon an owner's death.
[(A) Q: How many great fortunes are linked to family businesses? [A: very few] and (B) Q: How many have actually had to dissolve for this reason? (A: very few)]
...Democrats said that only a few thousand of the very richest estates had to pay the tax.
[i.e., the ones with the fewest links to poor little family businesses.]
- [Revenge of the Sociopaths II -]
Report by E.P.A. leaves out data on climate change - Editing by White House - Members of agency staff say they made cuts in draft to avoid a partisan tone [yeah, sure] - The White House said to play down global warming, by Andrew Revkin & Katharine Seelye, NYT, front page.
["Laissez faire" by the "hell with the future" meddlers in the White House? Remember "the ostrich with its head in the sand"?]
- [Revenge of the Sociopaths III -]
Occupation - Iraqis were set to vote, but U.S. wielded a veto - Barring an election and limiting free speech, the ideals promised to Iraq, by David Bohde, NYT, A12.
[Man, Nader was right. This administration is going sooo far overboard, it's just gotta wake up a LOT of people.]
NAJAF, Iraq...- American marines had build makeshift wooden ballot boxes. An Army reserve unit from Green Bay, Wis., had conducted a voter registration drive. And Iraqi political candidates had blanketed the city with colorful fliers outlining their election platforms - restore electricity, rehab the old quarter, repave roads.
But last week, L. Paul Bremer III, the head of the American military occupation in Iraq, unilaterally canceled what American officials here said would have been the first such election in Iraq since the fall of Saddam Hussein. Overruling the local American military commander, Mr. Bremer decreed that conditions in Najaf were not appropriate for an election....
[In other words, we're not going to do it unless it's going to come out Our Way. Sorta like the cosmetic "democracy" dba plutocracy here in the once-great USA. Guess where that puts our war rationale about "spreading democracy"?! Whatta laff. It gets worse -]
Several days later, American marines stormed the offices of an obscure local political party here, arrested four members and jailed them for four days.
[And we have the nerve to criticize Myanmar's treatment of Aung San Suu Kyi?!]
The offense, the Americans said, was a violation of a new edict by Mr. Bremer that makes it illegal to incite violence against forces occupying Iraq....
[Just like the charges against Aun Sung! And what are the Dems doing? The start of the headline above gives the clue -]
A Democrat is wary..., by James Risen, WSJ, A12.
- [then, oh yeah, there's "the economy, stupid" -]
Recession arbiter [National Bureau of Econ Research, Cambridge MA] says it is too soon to call end of slump, WSJ, B2.
- [and in the #3 economy (you don't want to know about #2!) -]
Germans put stock in store of 'future' [dream on] - Metro chain tries to draw shoppers with technology amid grim retail picture, by Annick Moes, WSJ, A10.
...German retail sales have stagnated for 10 years, helping to push Europe's largest economy into a deep funk....
[hey, just like Japan! (oops, we mentioned it) - funny how #2 & #3 are our 2 big enemies from WW2. Better we treated them nice and got them prosperous than do what we did to them after "the war to end all wars" (WW1) and set ourselves up for another WW. Today they'd both be a lot more prosperous if they were free of our Puritan work ethic, outdated in the Technological Age by "work smart, not hard."]
6/16/2003 surfin' those headlines from hell -
- Employment outlook is worst in 12 years, WSJ, A2.
...Manpower Employment Outlook Survey....
[Kinda spoils neighboring -]
Manufacturers in NY State report an increase in new orders, by Greg Ip, WSJ, A2.
- Small business engines may not be enough - Hopes for recovery in U.S. are pinned on small firms, but can they handle it? by Jeff Bailey, WSJ, B5.
[Doncha love the way big-firm CEOs vacuum-in spending power so tightly they starve the markets away from their own investments, and then they turn around and expect small firms to fix everything?]
...Sweeping changes over the past decade may...reduce the leadership role that small business plays in the eventual recovery.... [and what a leap of faith in that kneejerk assumption of "eventual recovery"!]
- the increasing inability to raise prices, and
- the overcapacity that developed in many industries during the go-go 1990s....
- [how so? - here's one tip of the iceberg...]
U.S. battles Europe to narrow global treaty banning corruption, by Bob Davis, WSJ, front page.
The U.S. [aka Bush administration] and Europe are battling over an ambitious global treaty to ban corruption, largely because Europe wants the pact to cover business and the U.S. wants it restricted to governments....
[Can you imagine? Now that the Bush gang is openly protecting corporate corruption, why don't they just attack motherhood and apple pie while they're at it? Is any of this ever going to penetrate from the front page of the Wall Street Journal A section to the mindless support of the Bush administration on its editorial pages at the back?]
6/12/2003 surfin' those headlines from hell - (but what do investors care with all that 'liquidity' burning holes in their overstuffed pockets?) -
- Consumer confidence slips in aftermath of war, by Greg Ip, WSJ, A2.
...after a sharp postwar bounce, further clouding the economic outlook....
[but what do investors care with all that 'liquidity' burning holes in their overstuffed pockets?]
6/10/2003 surfin' those headlines from hell -
- Fed finds few signs economy picked up after end of Iraq war, by Greg Ip, WSJ, A2.
[It ain't gonna pick up till we spread the work & wages and enforce & trim that outdated pre-technology workweek of ours that we haven't adjusted for the last 63 years.]
- UK, German figures add to gloom - Rise in British joblessness [by 0.1% in May], weaker output in Germany [by 1% in Apr] augment euro zone's woes, by Champion & Rhoads, WSJ, A14.
[except that the UK is in the pound-sterling zone, not the euro zone - they shoulda just said "augment Europe's woes" - editors!]
...The British unemployment numbers (May, 5.1%) are still enviable compared with Germany's 10.7% rate in May..\..
[But then Germany, like Japan, is more highly automated than Britain, compare USA, and Britain probably pretties up its unemployment rate like the U.S.]
6/07/2003 surfin' those headlines from hell -
- Nothing to fear, by Jesse Eisinger, WSJ, C1.
Step 1: Don't panic. Step 2: Congratulate one another on not panicking. Step 3: Keep ignoring the disrobed emperors.... And while we await patiently, the mortgage market is the main thing propping up the U.S. economy....
- Manufacturers warn of impact of plant closings, by Timothy Aeppel, WSJ, A2.
After several years of a shrinking manufacturing base, a prominent industry group [National Assoc. of Manufacturers] warned that a loss of "critical mass" by the U.S. manufacturing sector could reduce the nation's economic growth by half and lead to widespread declines in living standards....
The report points to a number of trouble signs, including the loss of 2.3m manufacturing jobs since July 2000, the largest decline the sector has seen since the early 1980s, and the diminishing share of capital investments and R&D spending by manufacturers compared with other parts of the economy. The report also says the cost of doing business in the U.S. is rising dramatically and that manufacturing exports as a share of GDP have contracted since 1987....
- Who's accountable? - How far were we misled into war?, op ed by Paul Krugman, NYT, A27.
[Basically, Krugman answers, no one's accountable, & we were completely misled into war. His wrap -]
...The Independent reports that British military chiefs are resisting calls to send more forces, fearing being "sucked into a quagmire." ...What's outrageous [is] not the fact that people are criticizing the [Bush] administration; it's the fact that nobody is being held accountable for misleading the nation into war.
6/6/2003 surfin' those headlines from hell -
- Unemployment rate rises to a 9-year high of 6.1%, by David Leonhardt, NYT, front page.
...as the worst jobs slump since the early 1980s continued to spread across the economy.... The economy has now lost almost 2.5 million jobs since February 2001...according to annual revisions released [yester]day by the Labor Dept. It is the longest sustained period without job growth since the period before World War II....
[and the Times didn't want to alarm you children, so it didn't mention that "the period before World War II" was the Great Depression.]
- [high pay, low skills]
Firms ranked, pointer blurb (to C1), WSJ, front page.
...among those with the worst corporate governance by a new survey share the common thread of hefty CEO pay.
[and the indicated article -]
Big companies get low marks [with] lavish executive pay, by Monica Langley, WSJ, C1.
richly compensate their top executives.
- Allstate Corp., [what a tragedy - Allstate used to be a good company]
- Citigroup Inc.,
- J.P. Morgan Chase & Co.,
- Honeywell International Inc.
- and Walt Disney Co. [another great pity - hamstrung by bullnecked Michael Eisner]
All have been ranked among the companies with the worst corporate governance, according to ratings to be released today by Corporate Library, a Portland ME governance-research firm [which] ranked 1,700 companies....
[Blessed art thou, Portland, Maine. For art thou not the least of the cities of the Northeast? Yet out of thee shall come an insight, which shall save thy people from their inequity.]
Rounding out its bottom-10 list are
- Emerson Electric Co.,
- Gemstar-TV Guide International Inc.,
- Loews Corp.,
- SBC Communications Inc.
- and Verizon Communications Inc....
6/05/2003 surfin' those headlines from hell -
- Retailers post weak same-stores sales - Wal-Mart reports 2.1% gain but says customers face liquidity squeezes, by Amy Merrick, WSJ, B4.
The blahs continue [graph title]
- New England wage gap found to widen - Study says raises larger for those with higher pay, by Kimberly Blanton, Boston Globe, E1.
...The trend increased salary inequality...between 1989 and 2002..\..in a region once known for having less of a rich-poor gap than the nation as a whole....
6/04/2003 surfin' those headlines from hell -
- Many say Europe needs more than just a rate cut - Searching for ways to jump-start a 12-nation economy, by Mark Landler, NYT, W1.
[Ooh ooh ooh (3 stooges), sounds like a potential version of The Big Question!]
With Europe's biggest countries stagnating and its currency soaring, the European Central Bank has been thrust into a new and not entirely comfortable role: economic savior for the Continent.
[Same as the Fed in the U.S. - and neither has a particularly hopeful leader to follow in Japan, which has pretty well exhausted the central-bank toolbox dba the cosmetology of interest-rate twiddling.]
Senior bank officials, including the president, Wim Duisenberg, have signaled in recent days that they will cut interest rates at their meeting on Thursday, perhaps as much as half a percentage point.
Mr. Duisenberg said inflation no longer posed much of a risk in Europe, given the rise of the euro against the dollar.
[Not something of primary relevance, since it only affects the export sector, seldom more than 15% of the economy, while domestic consumer demand accounts for some 66%. And that's the problem sector all over the world.]
In the coded language used by central bankers, that means, "It's time to cut." The question is whether Europeans [and Americans] - uneasy about the harmful effects of a strong euro [or weak dollar], exhausted by their chronic economic woes and despairing that their governments will ever fix things - are putting too much faith in the restorative powers of a single rate reduction. While virtually all economists here [and in the U.S.] favor a monetary easing, many say the effect will be short-lived, because it will be no surprise [now remedies need to be a surprise?!] and because the Federal Reserve may soon cut rates further in the U.S....
[Just for fun, let's develop a worktime-economics [WE] solution to all this. WE believes that at bottom, it's all commonsense and simplicity. All we humans really have is one another, and the solution is always a matter of sharing with one another in suitably flexible and sustainable ways. How to jumpstart a 12-nation economy? WE starts by assuming the problem is always the same. It's the old Chesterton pan-utopian trap = somebody isn't playing nicely with the other kids because they aren't sharing the toys. They've grabbed so many they can't even play with them any more. Just hanging onto them takes all their time and energy. How to loosen their grip and get those toys back into play so that even they, the over-toyed, are happier? Each EU nation should start by forgetting about exports, let's look at all the wasted demand at home. The U.S. stores its wasted demand in huge prisons and an even huger "disability" roster (and nobody's counting the homeless), supplemented by a bulging Pentagon. The EU stores it in high unemployment. Hint: France had a 39-hour workweek in 1997 and 12.6% unemployment. In the spring of 2001 before the US-led recession, it had a 35-hour workweek and 8.7% unemployment. Hmm, 4 hours, 4% reduction. And the slowest decline into recession in Europe except for heavily subsidized Ireland. Supposing we look more closely at this approach. It is, after all, what the whole developed world did between roughly 1800 and 1950 - we standardized the old agricultural workweek of dawn to dusk six or seven days a week to six or seven 12-hour days (72-84 hrs/wk), and gradually cut that roughly in half while not only maintaining, but raising, pay. The U.S. "led the charge" from 1790 to 1940. How did the miracle of falling hours and rising pay happen? One word. Machines. More recent translation. Technology. Europe and America were getting some nasty depressions in the early years of the Industrial Revolution, until the Luddites turned their attention from sledgehammering superproductive machines to cutting the working hours of humans, usually over the protests of most employers, but significantly, always with the help of a few far-sighted employers, who realized that unless they tried something "outside the box," they wouldn't have any markets left. Even Henry Ford, despite his later crabbiness, in his earlier life in 1912 raised his employees' pay way beyond market levels so they could "afford to buy their own product." It created a boomlet and one that lasted, with a little help from World War I and the flu epidemic (see mortality notes in 11/29-12/01/2003 #6), till 1929. The question becomes, how to standardize and spread what Ford did in 1912, so that war and flu were unnecessary? Could cutting the workweek more deliberately do it. After all, cutting hours "raised labor costs." The market forces harnessed by workweek reduction might have led Ford and every other employer to flexibly spread the national income to a vibrant market-supporting degree that would support their employer $$ hoards much more stably and sustainably than starving their markets was doing? It might also get them loved, like Carnegie and Rockefeller, instead of reviled like Gould and Fisk. Ergo, savings on security. The big German union is saying it today - "the union argues that manufacturers in the east are now competitive enough to afford having workers spend less time on the job for the same pay, and says a shorter week would spread available work among more people." See 6/05/2003 #2. And that's exactly the way American unions talked back in the early 1930s when they nearly got passed a 30-hour workweek bill that FDR blocked but later admitted he should have got behind it and got it enacted - it would have saved a lot of ineffectual big government, in fact, the whole New Deal which was marginally effective until World War II, which kindof gives you the suspicion that maybe something about the War did the trick, and nothing in the New Deal. So WE says, let's start now. First, a positive overhaul of overtime to disincentivize it as a moneymaker for either employers and employees, and restructure it as a training and hiring targetter. In terms of our best-candidate WE program design, that's in Timesizing's Phase 2 and Phase 3. Then we hook the point where overtime starts = the share of employment per person aka the workweek, to the unemployment rate, which is Phase 4, but lest we think unemployment is low, we may need to redefine it in a mainly time-based way to include the whole problem of non-self-support in this economy (including welfare, disability, homelessness, incarceration, forced part-time, premature retirement...) which is Phase 1. Then lest we overwhelm the fragile beginning's of the sustainable solution with population factors such as imports, immigrants and births, we implement Phase 5. In a multilingual 12-nation economy you also need a lot of work on common languages like French, German and English.]
5/31-6/02/2003 surfin' those headlines from hell -
- [Berlin Wall down, Israeli Wall up -]
Yet another roadblock: Israel's fence - Palestinians fear barricade may become real border; Israelis say it protects them, by Guy Chazan, WSJ, A14.
...Since last summer, Israel has been building a barrier along the West Bank in a bid to prevent infiltration by Palestinian suicide bombers. Israel says the fence is...about security; Palestinians say it is an excuse for a land grab....
[The Israelis have become their own worst enemies and the worst enemies of Judaism. They've played this kind of role before - e.g., when the Sikkari snuk around assassinating other Jews with their knives in the 50s and 60s AD.]
- [When Will They Ever Learn dept.]
British Energy takes a big [$7B] write-down on nuclear plants, by Heather Timmons, NYT, W1.
['Nucular' energy is appropriate (& natural) on the surface of stars, not planets.]
- 6/01 A pickup in growth? Don't count on it, by Charles Stein, Boston Globe, E1.
6/01 Tighter belts and higher anxiety, by Robert Gavin, Boston Globe, E1.
[and so -]
6/02 Consumer spending fell [0.1%] in April, by Jon Hilsenrath, WSJ, C12.
- 6/01 A theory evolves on church, state - Question of aid is again weighed, by Lyle Denniston, Boston Globe, A17.
WASHINGTON - The Bush administration's policy of providing government funds directly to churches, synagogues, and mosques - as in its grant to Boston's Old North Church - is tied to a constitutional theory that is gaining support, but not yet a clear majority, at the Supreme Court. The theory, a rethinking of the constitutional separation of church and state [i.e., it's unconstitutional, but where are the defenders of the Constitution now?], is that an institution that is primarily religion-based, even one that engages actively in worship [and proselytizing?!], still can qualify for public funds. That is a theory no prior administration has embraced....
[That's because it's not a "theory." It's a policy that is clearly in violation of the U.S. Constitution and one of the founding principles of the nation. It never fails to astound us how eager this administration is to attack the foundations of this nation, break any rules it cares to, and generally unlearn all the hard-learned lessons of history - and how passive and quiet the media are - and how relatively few people are making a noise, though there were THREE full-page ads in the NY Times against this administration on Friday (5/30: A11, A13, A15) and one on Saturday (5/31: A14). But it's all so eerily quiet. Where are the nationwide strikes? Lord, the French whom Bushies revile get more active and on-the-streets about the pensions than we do about our fundamental freedoms and rights! People who'd been in Germany in the 30s said as early as two years ago that it was starting to remind them of that time and place. Naive James Traub in "Weimar whiners," 6/01 NYT Mag 11 (see below), says some of his acquaintances have compared the collapse of the twin towers to the Reichstag fire. Now we're dropping barriers to further media ownership consolidation - George Soros must love that for his "open society"! - he better get ready to fund the best-hope '04 opponent big-time, or he's gonna have to move back to Europe for an "open society" than here in the erstwhile "Land of the Free." If we can't get rid of this cabal of extremist white-collar gangsters in '04, the world's only hope is that their undoing of all the hard-learned rules of the Great Depression, such as the "outdated" (ha!) Glass-Steagall separation of banking-brokering-insuring and bankruptcy law and the labor legislation, will speed this economy's undoing so deep and fast that their power will deflate like puff from the dot-com bubble. Or that Japan and Europe (minus UK if it stays Blairy-eyed) will efficiently get organized and united to protect themselves. Lest we lose sight of where we should be on the chart of human progress and social evolution, this is a time when we should be removing the tax exemptions of religious and "non-profit" organizations and making them the same as any other organization or corporation, not outrightly subsidizing them. And then, of course, we should be de-subsidizing all for-profit corporations and getting rid of all "corporate welfare" and "welfare for the wealthy." We should be dropping all the government makework, job creation, patronage and pork in favor of simple government refereeing of nationwide sharing and centrifugation of vanishing human employment and still-marketable skills. We should be building on the separation of church and state, religion and politics, to separate state and market, politics and economics. Only then will we approach having a truly free market, and becoming a truly free people, with the "four freedoms" based on the most basic freedom, free time.]
- 6/02 Behind media [regulation] and its end, one man [a once-progressive Republican], by Stephen Labaton, NYT, C1.
WASHINGTON...- Nearly 30 years ago, a young Republican lawyer named Richard Wiley led the Federal Communications Commission [FCC] as it approved a landmark regulation that restricted a company from owning both a newspaper and a broadcast station in the same city.
On Monday [today] the FCC is expected to repeal that rule in more than 100 cities as part of the most significant [call a spade a spade, DISASTROUS] overhaul of media regulations in a generation.... And it would come despite objections from an array of politically liberal and conservative critics who fear broad consolidation in the news and entertainment businesses.
But those objections were no match for big media, whose top lawyer and chief Washington strategist is none other than Mr. Wiley...who...says simply that his policy views are now different because the industry is different, [and so is] his vantage point, as the managing partner of Wiley Rein & Fielding for the last 20 years [which] has the most enviable list of [corporate] clients in the field [and] has supplied more lawyers to the important telecom posts in the Bush administration than any other firm....
- 6/01 Weinar whiners - To listen to some on the left, fascism is on the rise again - That notion is history, by James Traub, NYT Mag, 11.
[Traub is useful in cataloguing many of the excesses of this administration, but curiously naive in not connecting the dots about the mounting danger it poses - case in point: the two articles above. He seems to take great comfort in deja vu from the 60s and the way we threw around the word "fascist" then, but you didn't have the line-by-line comparisons with the rise of National Socialism then and you didn't have people who'd lived through that period drawing the comparisons. And it still took impeachment proceedings to end that particular tangent - where are they now? Traub also takes curious comfort in -]
...This is not simply a nation of dimwitted yahoos..\..
[despite the demonstrated power of extremist talkshow hosts on the 60% of American radio stations already owned by Clear Channel to whip people up against affirmative action and even organize them against anyone who dares criticize Bush a la Dixie Chicks. And then there's the cultivation of a culture of panic -]
6/01 What's next? How the SARS scare played into America's culture of panic, by Charles Pierce, Boston Globe Mag, cover story.
[and even a genius, with sufficient distraction, can behave like a "dimwitted yahoo." Traub also takes strange comfort in -]
Civic and state institutions [though hamstrung by federal defunding], including [huh?] the media [though already more narrowly owned than anytime in US history], the judiciary [though the high court pre-empted the people's election], and the party system [though both parties incrementally weakened any other parties' chances over the decades and now one has become a religious party and the other a pathetic imitation, both drowned in PACs and lobbyists and money from "their corporate overlords."]....
Why, then, the hysteria?
[Because the truth about the disinformation used to justify the war is not getting out. The current chaos of Afghanistan and Iraq are not getting out. The conflicts of interest are not getting out. Traub's comforting counter-examples -]
..\..Opposition from both liberals and libertarian conservatives...killed the TIPS (Treasury Inflation-Protected Securities) program [big deal] and may already be hindering next-generation Patriot II legislation ["may be hindering"? = pathetic example]; organs of the "corporate-controlled media," like "60 Minutes," have reported on the growing threat to civil liberties [whoopeedoo].
[These are all isolated and rather pathetic instances. The thing that stopped the "fascism" of the 60s and early 70s -]
..\.. the impeachment proceedings against Nixon....
[that Traub takes so much comfort from is totally absent from the public debate today, even though it was all over the place against Clinton a few years ago when we were only talking about sexual pecadilloes and word games. This administration is dismantling the foundations of the nation and guys like Traub are still taking its side and marvelling at the 'over-reaction' against it. How can you over-react to a group that's willing and eager to invoke the chaos of war against a nation that poses no direct threat to us while defunding veterans' benefits and even homeland security? As Krugman pointed out a few days ago (5/27 #1 below), even the Financial Post is saying the lunatics are running the asylum here. Traub is a sheltered and naive entity who has brought no imagination to his reading of history - or has read very little of it. Like many of our fishermen and lumbermen who assume our oceans and forests are infinite and undamageable, he thinks the freedom and integrity of this nation is somehow absolute and undamageable.]
- 6/01 Blame the government's immigration policy, letter to editor by Lorrie Hall of Duxbury MA, Boston Globe, E2.
"Race matters" (May 23) is revealing.... It is a sad fact that employers would rather hire immigrants and women than blacks. But the blame should be leveled at the federal government for allowing in the high number of immigrants who compete with blacks for unskilled jobs. If we had a lower immigration rate, such as we had in the '60s, black unemployment would be lower.
Now that we are in a recession, there are not enough [40-hr/wk] jobs for American citizens, let alone for immigrants, yet the federal government shows no signs of reducing the immigration level to give citizens a chance at the jobs. I find it shocking that politicians are so unresponsive to the concerns of...citizens.
[The Timesizing Program deals with immigration along with the other two "population variables" (imports and births) via regular public referendums in Phase Five.]
- 5/31 Japan: Unemployment rises, AP via NYT, B3.
...The number of jobless totaled 3.85 million people, up 100,000 from the same month a year ago, the Labor Force Statistics Office said yesterday. Jobs fell in farming, construction, manufacturing, retailing and restaurants.
Japan has been fighting its worst slowdown in half a century. \Its\ unemployment rate stood unchanged [from March] at a near-record 5.4% in April, highlighting the problems that have ailed its anemic economy for nearly 2 years, the government said.... The labor problem began to take a turn for the worse in the summer of 2001, edging up to 5% levels for the first time since the government began keeping those statistics in 1953.
[Man, does Japan ever need worksharing (especially in its flexible, prioritized, gradual and market-oriented Timesizing form) but we haven't heard much about it there lately - last mention was way back on 2/01-03/2003 #3. Check out the story right above this one in the Times -]
Japanese government plans to control bank after bailout, Bloomberg via NYT, B3.
Kenji Kawada...president of Resona Holdings..\..which was given a $16.5B government bailout...said salaries would be cut 30% and 113 executives would resign. [photo caption]
[Ya know, however tough it may be to get your head into timesizing and work out the kinks and implement it, it's GOTTO be waaaay easier than this!]
- 5/31 France: Jobless number stays high, Reuters via NYT, B3.
French unemployment was unchanged at 9.3% in April, the Labor Ministry said, in line with economists' forecasts and spelling more gloom for a government plagued by protests over pension 'reform' [our quotes].
[France has gotta quit diluting the 35-hour workweek that brought unemployment down from 12.6% in 1997 to 8.7% in 2001, and lower it further. It's gotta spread the vanishing work and quit distracting itself about benefits for some of the employed while there are still so many unemployed.]
The jobless rate, well above the euro zone average, was its highest since August 2000 [when it was on its way down from 12.6%] after rising 0.1% in March from 9.2% in February.
For earlier collapse stories, click on the desired date -May 16-30/2003.
July 1-15/2002 + Jun 30.
Earlier Y2000 months accessible via links at bottom of Dec.1-10/2000 page.
Earlier 1999 months accessible via links at bottom of Dec.1-15/99 page.
Earlier months accessible via links at bottom of Dec/98 page.
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