(Insert Super-Awsome Blog title here)

In part of one of my previous posts, I made a reference to the fact that a recession can/should reset prices and cleanse the markets. This idea goes beyond price and demand bubbles. It also applies to the use of credit. As I’ve said, easy money, backed by the fed through freddie and fannie, caused the unnatural increase in demand for housing which snowballed by bringing in an unnatural amount of speculators, causing the bubble. That easy money overflowed into every corner of the markets. So now that it has been cut off, we are seeing the effects.

I’m of two minds concerning what to do. The conservative and principled part of me sees the absurdity of overuse of credit, and wants to say that cutting it off should teach businesses, government, and individuals to learn how to better live within their means, something this country needs badly. (that’s the cleansing effect I’m referring to)

Alas, I afraid the other part of me  might be more practical. I think they’re going to take away my libertarian decoder ring for saying this.

You see, you can’t just take the heroin away from the junkie because the withdrawls might kill him. You have to ween him off it. It seems terribly ironic that we give addicts perscription drugs that are often equally addictive as their illegal counterparts. But, what choice do we have? When you switch a heroin addict to methadone, there’s a small chance he will kick the habbit. Most likely, he will just live out his days addicted to methadone instead of heroin, but it’s even more dangerous to cut him off completely.

Our credit problem is much the same. Many businesses cannot operate without spending next quarters’ earnings, simply because they have become so used to operating this way. If credit ceases to flow, our economy suffers from withdrawals.

The irony is much the same as in my analogy. The problem was caused by government-backed over-leveraging, and we are attempting to solve it through more leveraging. Injecting liquidity into the credit markets to deliberately re-expand credit, when the problem was caused by too much credit in the first place (easy money).

Am I saying that the current Fed action is correct? No. But it might be necessary. I’d love to say let’s go cold turkey; It might be a decade before we see real growth again, but at least it would be growth built on hard work, rather than growth built solely on credit. The problem is, I’m not sure we can survive the detox.

Of course the problem in all of this is that I in no way trust congress or the Fed to handle this the way it should be handled. That is, inject JUST ENOUGH credit to keep things alive while business get their accounting practices back on solid ground. Then slowly draw back the artificial credit expansion so that credit once again becomes a function of mutual benefit of both borrower and lender. (with REAL default risks written into the rates, as opposed to ignored because of Fed backing and rate-fixing).

Instead, I’m afraid the economy is just going to be addicted to methadone instead of heroin.

The National Debt Clock in New York has officially run out of digits. The clock was erected in 1989 to highlight the ridiculously high national debt of $2.7 trillion. it has now exceeded $10 trillion.

This highlights the fundamental problems with government right here. In it’s desperate attempt to solve every problem and constantly justify it’s own bloated existence, government has screwed us all. When did they think this was going to end? Did anybody really think this wouldn’t catch up to us? That we could spend further and further into the future forever with no consequences?

Keynes was soooooo wrong.

Ok, so that last post was kinda doing exactly what I was bitching about; that is, scaremongering and trying to make everything seem negative.

So here’s the optimism:

• Housing prices are way down, which is GOOD, despite what they tell ya. once the credit markets stabalize, more people will be able to afford housing.
• Speaking of those credit markets, the media has been saying for weeks (months?) that it is impossible to get a loan out there. The stories are all the same, they find some sap who got turned down for his loan and turn anecdotal evidence into trend-revealing data. The truth is though, that most lenders are doing business as usual with one big difference; they are only lending to well qualified borrowers with good credit. GASP! If you want a loan, I suggest you go to a small local bank. There are 9,000 of them and the vast majority have perfectly healthy balance sheets.
• unemployment is way way way way up! Or maybe just a couple of points. it’s hovering at around 7 percent in my area, which is supposed to be one of the hardest-hit cities. It exceeded 40% during the Great Depression. Also, most economists consider anything under 5 percent to be a fully employed market. It will probably continue to rise, but you can count on the media to panic at every tenth of a percent increase.
• The DOW drop on monday is being called the largest single-day point drop in history. What the headlines don’t tell you is that a couple of decades ago, the DOW couldn’t have dropped 777 points because IT WASN”T EVEN THAT BIG. Moday’s ‘crash’ was about a 7 PERCENT drop, which is the 17th largest percent drop in history. If you look at where those other drops occured, many of them were during periods that aren’t even considered deep recessions. Also, the DOW jumped back about 500 points the very next day. So….. don’t panic. Just to put things in perspective, the DOW has more than quadrupled since 1990. So veteran investors have made a lot of money, and can probably weather a 7 percent drop in values.
• The financial markets and the economy are not one and the same, despite the picture being painted by Paulson. A large crash in the financial markets will definitely hurt the national economy, but it can and will survive. The companies that will fail are the ones who cannot operate without being over-leveraged. It’s time we stop propping up companies who’s business models simply are not profitable.

• The last deep recession had a cleansing effect that reset prices and values back to reality, and ultimately led to a couple of decades of uninterupted growth. It wasn’t until the last 8 or 9 years that that the markets got greedy and the fed started ignoring it’s own regulations, leading to an easy money situation that increased demand WAY beyond natural levels and led to a huge bubble. This recesssion, if congress doesn’t screw us, should have a similar cleansing effect. It should have, and could have been, a perfectly healthy market correction. A recession is painful, but ultimately healthy and neccessary for the markets. Friedrich Hayek said in 1932: “Instead of furthering the inevitable liquidation of the maladjustments brought about by the boom during the last three years, all conceivable means have been used to prevent that readjustment from taking place; and one of these means, which has been repeatedly tried though without success, from the earliest to the most recent stages of depression, has been this deliberate policy of credit expansion. … To combat the depression by a forced credit expansion is to attempt to cure the evil by the very means which brought it about …”   What an amazing parallel.

The last thing I want to say sort of changes the subject, and also politicizes this post. But it’s something that has been really bothering me. Free market types, economists, libertarians, etc. are very often attacked for being corporate shills, being pro-corporate welfare, etc. People like Naomi Kline and Thomas Frank constantly accuse libertarians of things like disaster capitalism and profiting through victimization of the poor and blah blah blah. I find it incredibly ironic that the free market voices are the same voices arguing against the bailout. The ones who normally rail against big corporations and complain about how unfair it is that some people are incredibly wealthy while others are incredibly poor, they are the ones who are now supporting bailing out companies who made terrible business decisions? Why do they want to prop up housing prices? That is an attack on renters. It’s an attack on the lower class to keep housing unaffordable.

I guess one small benefit of the current situation is that it is exposing a lot of people for who they really are, and what they really believe in.

This is just about the scariest graph I’ve ever seen.

The teasurey secretary, chairman of the federal reserve, the administration, and congress are all trying to convince us that the economy is about to crumble around us. I don’t want to be cliche but it’s becoming a self-fulfilling prophecy. That 777 DOW drop on monday? That wasn’t because of any independent market conditions, it was because of the rhetoric coming out of washington scaring the crap out of investors. The runs on the bank, low consumer confidence, these things are all a direct result of the political rhetoric we have been hearing lately. So not only are they damaging the economy through negative propoganda, the bailouts and new monetary policy are going be a silver bullet to kill our markets. Fifty dollar loaf of bread anybody? Take a look at that graph. Amazing. 11.6 percent increase in the monetary base in ONE MONTH.

You gotta love stumbleupon.

Here’s a few awsome things i’ve stumbled upon lately.

This amazing gallery.

This girl figured out how to fold a piece of paper more than 7 times.

A forum for discussing Polywell fusion reactors

Brief description of what might be the oldest man made structures ever discovered. Possible evidence that homo sapiens had civilization and even math and astrology in southern Africa LONG before the civilizations in the fertile crescent.

Ten most puzzling ancient artifacts. VERY interesting compilation. I think the Baghdad battery is the most intriguing.

some pothead outlines the ideological problems with supporting the war on drugs. And he’s absolutely correct.

World sunlight map. It’s almost tomorrow morning in Australia.

Holophonic sound. Just listen to these recording with headphones. I guarantee you will be amazed.

See what phase the moon is in right now. Or just walk outside at night. Either way…

I’ve been expecting quantum computers to come out ever since I read timeline by michael crichton in high school. What’s taking so long?

Viruses that prey on viruses.

OK I’ll stop now. But seriously, stumbling is awesome.

Yesterday Kylie and I drove about an hour out of town up through winding foothill roads to this nursery. I’ve seen so many galleries in books and online, and I’ve seen a couple of modest backyard displays with decent bonsai; I’ve had never been to a proper bonsai nursery with significant displays. This guy has some truly amazing bonsai. the biggest and best were priced up to $3500. These are the kinds of trees you only get after 30 or 40 years of work on a plant. He had hundreds and hundreds, all different species and styles and sizes. All of them properly displayed in an extensive, multiple acre garden with winding paths and fountains… I was amazed, and the whole experience made me feel very, very amateur. I have a pretty extensive knowledge of horticulture, and I know all the basics of the art of bonsai, but I don’t believe I will be creating gallery-worthy bonsai without some professional training. There are a couple of local bonsai clubs that offer periodical workshops. Lotus Bonsai nursery even offers training, though it’s very expensive. The cheapest is around $75 per DAY. The most expensive, where they work with you and your plants one-on-one, is $350 a day.

Anyway, here’s another website with galleries that make me feel like an amateur. It’s sort of a bonsai blog with articles and galleries profiling various bonsai masters. I’m especially obsessed with this piece by Warren Hill. Watch for a future post displaying my own grove planting. (I haven’t done one yet, just plan to).

There are so many bonsai masters with such amazing collections. One of my favorites right now is Walter Pall. He did one of my all-time favorite bonsai; this japanese maple is famous all over the world.

I’ve been messing around with Mame style bonsai lately. (also known as Shohin or Shito, depending on the school) I have actually done a couple of these before; I’ve had two of them for about two years. The rest I re-potted and trimmed to their current shape within the last couple of months.

Bonsai is an art form. people have mixed definitions of the word itself, and I don’t think any of them can be considered incorrect. I would define any manipulation of a plant with the intention of creating illusions of size and/or age, as a bonsai. With that broad definition, I find myself attracted to the more extreme representations; in this case extremely small.

This gallery first introduced me to the concept years ago. Certainly, none of my own bonsai look anything like the amazing works pictured on that site. Still, I am very proud of my little beginners and I’m asking you to look at them for what they will become after years of proper training.

A micro-leaf variety of Hedera helix, Mame/semi-cascade.

A variegated Serissa foetida, mame/broom style.

A common cotoneaster, mame/upright style.

Another species of cotoneaster, mame/upright style. (I don’t know the species)

These are my favorite four. This is them displayed as a group.

besides these, I have a number of cuttings planned fore this style that are still rooting and far too young to display as bonsai. Also, at the end of my last blog post I showed another bonsai. I didn’t know the name of it at the time, but I recently discovered that it is a variegated eleutherococcus, or Aralia. That one could also be considered mame, assuming I keep it about the same size it is now.

UPDATE: I listed the fourth one down as a cotoneaster. I just found out that it is not technically cotoneaster at all. It is a Corokia, or wire-netting bush. The nursery that sold it to me had it tagged as a Corokia Cotoneaster, which I read as a common name for a species of cotoneaster, when it was in fact the scientific name for the plant.  See, cotoneaster is large genus in the rose family. But this particular species of corokia (genus) is called cotoneaster (species). Corokia genus isn’t even in the rose family. There is debate between botanists on which family to classify it in but the debate is between the families Argophyllaceae, Saxifragaceae, or Cornaceae. None of this would matter much if I hadn’t been showing an actual cotoneaster, (the Cotoneaster Microphylla in the third picture) in the same post.

I took some pictures of my favorite tree during the winter to show its dormant branch structure and then again recently with it’s leaves back on. Pretty good contrast. This was its first winter dormancy and then spring growth season since it was formally potted as a bonsai last year. I did a little more wire training of the branches during the winter, and I believe that will be enough; I should only be training it through trimming from here on out.

Here’s the dormant maple:

and here

And here it is more recently, with it’s leaves back on. (standing next to a little shrub honeysuckle.)

A closer look

A better picture of the root over rock style:

And just for fun, here is a cute little something I planted last fall. I have no idea what it is.

A couple of my favorite blogs have been posting about this, and I thought I’d get in on the action and rant about it a bit.

Federal, State, and local authorities conducted a sweeping mass raid in TN, MS, and AR over the weekend. They were supposedly looking for terrorists and terrorism related activities. They arrested 332 people, issued 1,300 citations, and seized ‘hundreds’ of dollars. They called it ‘Operation Sudden Impact’. They used 50 agencies to conduct road blocks, raids of homes, businesses, and boats, and many personal searches. Surprisingly, they did not find any terrorists.

From the news accounts:

…law-enforcement officers said they are just trying to track down possible terrorists before something big happens.

Bullshit. That is not what this was about but it does help illustrate how easy it is to use the supposed threat of terrorism to justify any and every intrusion into your lives.

The Sheriff’s Department says 332 people were arrested, 142 of whom are were fugitives.

I would bet money that those 142 ‘fugitives’ were people with bench warrants for unpaid tickets. Arresting and actually booking people for unpaid tickets is, IMO, complete insanity to begin with (just turns cops into bill collectors) but that’s a post for another day.

Out of all the news stories I’ve read about this so far, none have questioned whether authorities obtained search warrants prior to conducting the raids and searches. They certainly couldn’t have had warrants for the automobile searches performed during the traffic road blocks, which is entirely illegal in most cases.

I find myself wondering, where is the outrage at this? Why do media accounts not include serious questions for the agencies involved?

The FBI along with hundreds of officers said they are looking for anything out of the ordinary. Agents take computers and paperwork from businesses.

That is so creepy. Sounds Orwellian, or maybe Soviet Russian?

This thing involved several federal agencies, including the FBI. That tells me these 3 states are just the beginning. Must be some kind of genius that came up with this idea. Can’t find any terrorists after all the illegal surveillance? Let’s just systematically pull over every single person in America as well as search every home and every business; that should turn up a few terrorists and we can even bust some drug users in the process.

Ironically, those who support this sort of authoritarian police behavior and erosion of your freedoms in the name of fighting terrorists like to point out that ‘islamofascists’ would make you submit to sharia law, and that they ‘hate you for your freedom’.

I can’t believe it has come to this. It is like a parody in itself. The threat of terrorism can be used to support anything from war and torture to the writing of more seatbelt tickets.

So, did anybody hear about the Family Smoking Prevention and Tobacco Control Act of 2008? Didn’t think so. It was approved by some useless congressional committee last week and it has all but complete support in congress. It will pass with no trouble and the American people will never hear about it. I predict there will be ZERO discussion in the houses about whether further regulation of tobacco products by another administration (FDA) is really an appropriate use of government.

Essentially, this bill hands regulatory control of tobacco products over to the FDA. Problem is, the FDA’s purpose is to regulate medicines so that they are guaranteed to be safe. Cigarettes and tobacco products are inherently unsafe., which means this bill directly compromises the sincerity all FDA regulations.

Don’t ya love how it’s called the FAMILY smoking prevention and tobacco control act? That way, it cannot be opposed because no congresscritter wants to be against the family. Assholes. There are plenty of private organizations working to educate the public about the dangers of smoking cigarettes. We do not need more government bureaucracy to prevent people from smoking.

But wait, nobody listens to standard libertarian common sense arguments about the pointlessness of government; especially when it’s for the children. So why am I even bothering? Because there is something else going on here. Guess who lobbied members of the House Energy and Commerce Committee to get them to approve the legislation. PHILLIP MORRIS. What? Why would the largest cigarette company put their money and support behind legislation that further regulates THEIR industry? Competition, that’s why. Follow my first link and read a little more into the bill. It’s not just a vague call for the FDA to regulate tobacco. It carries specific new burdens and advertising restriction for tobacco companies; regulations that can be easily met by Phillip Morris, but greatly restrict any smaller cigarette manufacturers. It’s the most disgusting type of protectionism. The act would be more appropriately titled: ‘The Protect Phillip Morris’s’ Market Share act’

This Pretty much the same reasoning behind congressional hearings being held lately about internet gambling. They are trying to expand their power to go after ISP providers to help prosecute evil online poker players. You see, Vegas et all doesn’t like online gambling, for obvious reasons.

Same shit, different day.