I'mmmmmmmm Baaaaaack!!

Well, six houses, seven gift openings, 1300+ miles, ten dogs, dozens of relatives and a partridge in a pear tree later, I return. It is good to be home. I sit here watching the Miami/Jets game, hoping the Jets can pull it out (update, they did not do so). New England's future likely depends upon it. Oh well, like the stock market, watching it will not make a difference.

Two Months

Yesterday was the official two month anniversary of my blog. I would have liked to blog but I was on the road nearly the whole day and landed in a location where I did not have internet access. Nice break, however, after a long drive. Anyhoot, two months in and, apparently, picking up speed. Seeking Alpha posted my first contributing article today. You can either click on the Seeking Alpha certified label on this blog or go here to see it.

http://seekingalpha.com/sector/retail?source=refreshed

Quite the honor for your's truly. I will try to continue to live up to their standards. But now, on with the good stuff, what little there is:

Latvian Prostitutes

Okay, I must confess that I do not fully understand the Latvian economy or the price of hookers within it. Indeed, "not fully understand" is a vast understatement as I would be hard pressed to find Latvia on a globe, much less discuss the plight of it hookers. Thus, I refer you to Bronte Capital for more detail.

Let me be a bit clearer here, as Bronte Capital talks more about currency devaluation, monetary policy and the like moreso than the prostitution trade in Latvia, though he links an older post that I read when it came out that is more intensive on the prostitution side of things. I will not seek to fully understand or explain his musings. The only thing I can say is that the pain is obviously geographically and economically widespread. And all occupations, including the oldest, seem to be impacted. Moreover, U.S. prostitutes beware!!

http://brontecapital.blogspot.com/2008/12/hookers-that-still-cost-too-much-some.html

UPS - Social Upheaval

I will be the first to admit that I am making a mountain out of a mole hill here, but it plays well with various comments I have made here, so I am running with it. A UPS driver apparently signed in a turban wearing customer as a "terrorist." The attached article addresses the rampant racism in this act and deals well with the facts, so I will not go there.

http://consumerist.com/5119125/sikh-signs-for-package-ups-driver-enters-his-name-as-terrorist

Where I will go is the social unrest caused by economic recession or, perhaps, depression. I was thinking about this today on the long drive home so I have stretched the UPS article to fit in my thoughts. Let me begin with a quote from Time magazine when it made Hitler the Time Magazine "Man of the Year" for 1938:

"Most cruel joke of all, however, has been played by Hitler & Co. on those German capitalists and small businessmen who once backed National Socialism as a means of saving Germany's bourgeois economic structure from radicalism. The Nazi credo that the individual belongs to the state also applies to business. Some businesses have been confiscated outright, on other what amounts to a capital tax has been levied. Profits have been strictly controlled. Some idea of the increasing Governmental control and interference in business could be deduced from the fact that 80% of all building and 50% of all industrial orders in Germany originated last year with the Government. Hard-pressed for food- stuffs as well as funds, the Nazi regime has taken over large estates and in many instances collectivized agriculture, a procedure fundamentally similar to Russian Communism."

I do not pretend to understand Hitler or WWII, but as I understand it Hitler's rise to power was in part due to economic strife in Germany and a promise of economic austerity. The present times, I fear, are leading to an arena where such rhetoric can again gain a foothold. People are looking for scapegoats to execute or to explain or excuse their pain. It is this environment that on an international scale can lead to those with the wrong message being believed. Those wanting to stir the pot can stir the pot.

I hope these words ring hollow and the world comes together to fight our current economic plight. But I fear that these times will lead to enough desperartion that we will see over the next decade more political and military turmoil than we have in a long time.

I realize this is a bit off the mark from my usual fare, but the political/military/war arena impacts all others, so it needs to be considered. If I am right, I will not say I told you so. If I am wrong, I will be very happy to say so. Watch though, as things are beginning to percholate a bit around the world.

Yield Curve - No Where to Go

Those that follow the yield curve may think the worst is behind us. Well, that ignores that the Fed has taken the Treasury rate down to 0%, effectively negative, so this means nothing. Don't believe me, Krugman says it better than I can.

http://krugman.blogs.nytimes.com/2008/12/27/the-yield-curve-wonkish/

No Safe Haven (or very few)

I report here often on U.S. spending being low. Well, we are not the only ones. Britian is sucking wind as well. Not a lot to add here except to note again that the decoupling theory was just that, a theory. Sometimes theories do not hold water. And if this was your theory, well, can I hand you a sponge?

http://www.guardian.co.uk/business/2008/dec/26/creditcrunch-consumerpages

History Books

A lot will be reported about the current financial crisis as time passes. This will fill chapters in economic texts in the future. I fear it will all be reported as the dire consequences to those who could not foresee this coming, as opposed to focusing on those that anticipated it coming. I would like to be considered in the latter crowd, but I was late to the game, not joining that bandwagon until late 2007, which turned out to be in the nick of time but still a bit late. Many others saw it coming far in advance. As one comment I saw mentioned, however, some saw it coming too soon. If you predict a bubble too soon, you can miss out on massive gains. If you get out too late, you have massive losses from your earlier massive gains. If you are in the middle, Goldilocks will be happy. In the end, it is best to probably be somewhere in the middle. Early or middle, however, and the history books will forget you.

http://www.theglobeandmail.com/servlet/story/RTGAM.20081226.wmeltdown1227/BNStory/National/?page=rss&id=RTGAM.20081226.wmeltdown1227

Disclosures: I work for a subsidiary of Fairfax Financial and own stock in that company through my employee stock owernership program.