Monday, November 01, 2004

Politics: Which Way?

It's down to the wire.

There is only one focus for tomorrow: the election for President of the United States.

This has been a brutal campaign. George Bush is like a lightning rod attracting strong support or great animosity. John Kerry is more like a bowl of jello, attracting neither great support or great animosity... as judged by polls that show likely voters for Kerry are almost split between those voting for him and those voting against Bush... passions seem to slide off Kerry.

Why is this?

Let's look at Kerry first.

He has never been a person of outward passion. Even when he tries to be aroused, he leaves the impression of one who is about to put himself to sleep with his own voice. He certainly does have passion, however. His record of forty years is clearly one of animosity toward things military. He is a product of his Vietnam experience. He is also a product of those who believe it is the manifest destiny of the U.S. to leave the manifest destiny of others alone.

John Kerry is an idealist. He wants the world to be civil and reasonable and rational and kind. Therefore, he is prone to side with those who would use discussion rather than violence... who would provide aid and support rather than those who would leave it to the forces of the marketplace... who would place personal freedom above religious or moral outrage.

But he is also a man of contradiction and complexity. While disparaging the wealthy and powerful, he has become one. While arguing those with greater wealth and income should be taxed more, he is not. While stating that he would be a strong, militant leader against those who threaten us, he has voted to deny necessary resources to those who he would enlist in that effort. He has intellectual rather than personal idealism.
George Bush is not complex to understand.
He is religious and believes that there is a distinct line where individual freedom must not move past moral obligation. He tends to view the world in absolutes more than shades of grey. He supports a process of opportunity more than a process of support for individuals. He is unabashedly "America first" and will ignore world opinion if he feels he is morally right and acting in the best interests of the U.S. He is more comfortable with the entrepreneurial process than the social safety net process (although his Medicare prescription program is a decided departure from that comfort zone).

Consequently, George Bush is seen as reckless and a threat to individual and world freedom by those who do not share his religious or nationalistic views. They see him as the world bully rather than a defender of freedom and an espouser of liberty. They see corporate entanglements behind his domestic and international economic policies which leads them to see him as the enemy of the "common man".
The personal contrasts are stark. The political positions are distinct.

Where do I stand? As much as I would like to believe that it is possible to approach the present world situation in a civil, reasonable, rational and kind way, I am inclined to accept that there are forces against whom we must fight and eliminate... forces that are basically malevolent. Unfortunately, this is an overriding issue.

In an ideal world, I would choose to be civil and reasonable and rational and kind to all... despite any differences of opinion or goals. But in a world where flying airplanes into buildings is seen by some as magnifying the "glory of Allah", I recognize that a segment of the world has strong elements of the irrational.

Consequently, I will support our current president despite misgivings about other policies.

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There is always an easy solution to every human problem—neat, plausible, and wrong.
Henry Louis Mencken (1880–1956)
“The Divine Afflatus,” A Mencken Chrestomathy, chapter 25, p. 443 (1949)
... and one could add "not all human problems really are."
It was beautiful and simple, as truly great swindles are.
- O. Henry
... The Government is on course for an embarrassing showdown with the European Union, business groups and environmental charities after refusing to guarantee that billions of pounds of revenue it stands to earn from carbon-permit trading will be spent on combating climate change.
The Independent (UK)

Tracking Interest Rates

Tracking Interest Rates


SEARCH BLOG: FEDERAL RESERVE for full versions... or use the Blog Archive pulldown menu.

February 3, 2006
Go back to 1999-2000 and see what the Fed did. They are following the same pattern for 2005-06. If it ain't broke, the Fed will fix it... and good!
August 29, 2006 The Federal Reserve always acts on old information... and is the only cause of U.S. recessions.
December 5, 2006 Last spring I wrote about what I saw to be a sharp downturn in the economy in the "rustbelt" states, particularly Michigan.
March 28, 2007
The Federal Reserve sees no need to cut interest rates in the light of adverse recent economic data, Ben Bernanke said on Wednesday.
The Fed chairman said ”to date, the incoming data have supported the view that the current stance of policy is likely to foster sustainable economic growth and a gradual ebbing in core inflation”.

July 21, 2007 My guess is that if there is an interest rate change, a cut is more likely than an increase. The key variables to be watching at this point are real estate prices and the inventory of unsold homes.
August 11, 2007 I suspect that within 6 months the Federal Reserve will be forced to lower interest rates before housing becomes a black hole.
September 11, 2007 It only means that the overall process has flaws guaranteeing it will be slow in responding to changes in the economy... and tend to over-react as a result.
September 18, 2007 I think a 4% rate is really what is needed to turn the economy back on the right course. The rate may not get there, but more cuts will be needed with employment rates down and foreclosure rates up.
October 25, 2007 How long will it be before I will be able to write: "The Federal Reserve lowered its lending rate to 4% in response to the collapse of the U.S. housing market and massive numbers of foreclosures that threaten the banking and mortgage sectors."
"Should the elevated turbulence persist, it would increase the possibility of further tightening in financial conditions for households and businesses," he said.

"Uncertainties about the economic outlook are unusually high right now," he said. "These uncertainties require flexible and pragmatic policymaking -- nimble is the adjective I used a few weeks ago."

December 11, 2007 Somehow the Fed misses the obvious.
[Image from:]
December 13, 2007 [from The Christian Science Monitor]
"The odds of a recession are now above 50 percent," says Mark Zandi, chief economist at Moody's "We are right on the edge of a recession in part because of the Fed's reluctance to reduce interest rates more aggressively." [see my comments of September 11]
January 7, 2008 The real problem now is that consumers can't rescue the economy and manufacturing, which is already weakening, will continue to weaken. We've gutted the forces that could avoid a downturn. The question is not whether there will be a recession, but can it be dampened sufficiently so that it is very short.
January 11, 2008 This is death by a thousand cuts.
January 13, 2008 [N.Y. Times]
“The question is not whether we will have a recession, but how deep and prolonged it will be,” said David Rosenberg, the chief North American economist at Merrill Lynch. “Even if the Fed’s moves are going to work, it will not show up until the later part of 2008 or 2009.
January 17, 2008 A few days ago, Anna Schwartz, nonagenarian economist, implicated the Federal Reserve as the cause of the present lending crisis [from the Telegraph - UK]:
The high priestess of US monetarism - a revered figure at the Fed - says the central bank is itself the chief cause of the credit bubble, and now seems stunned as the consequences of its own actions engulf the financial system. "The new group at the Fed is not equal to the problem that faces it," she says, daring to utter a thought that fellow critics mostly utter sotto voce.
January 22, 2008 The cut has become infected and a limb is in danger. Ben Bernanke is panicking and the Fed has its emergency triage team cutting rates... this time by 3/4%. ...

What should the Federal Reserve do now? Step back... and don't be so anxious to raise rates at the first sign of economic improvement.
Individuals and businesses need stability in their financial cost structures so that they can plan effectively and keep their ships afloat. Wildly fluctuating rates... regardless of what the absolute levels are... create problems. Either too much spending or too much fear. It's just not that difficult to comprehend. Why has it been so difficult for the Fed?

About Me

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Michigan, United States
Air Force (SAC) captain 1968-72. Retired after 35 years of business and logistical planning, including running a small business. Two sons with advanced degrees; one with a business and pre-law degree. Beautiful wife who has put up with me for 4 decades. Education: B.A. (Sociology major; minors in philosopy, English literature, and German) M.S. Operations Management (like a mixture of an MBA with logistical planning)