In a comment last week, I said,

Treasury Securities are the only assets that can …

… be held be the people that issue the actual fiat money. So, while the US dollar could lose standing abroad and with it would go the top ranking of US Treasuries overseas, it is institutionally entrenched as the AAA ranked US dollar denominated financial asset.

And while the gist of the argument is sound … Treasury Securities are the last financial asset standing if you need financial assets denominated in US dollars, and that is intimately tied up with the way that the Fed works …

… the statement itself is deeply flawed.

In ordinary times, it would be a footnote. The Fed can also hold as assets loan contracts with commercial banks, and other such loan contracts as the legislature may from time to time permit.

Well, how did they keep the current crisis from blowing up? After all, it was late last year that the housing market bubble burst … how did they string it out until September of this year?

How they strung it out was by lending to get financial institutions out of their short term liquidity bind. And as institutions ran out of Treasury Security and “high quality” mortgages to borrow against, the Fed relaxed its standards to allow borrowing against lower quality assets.

Except, the way that the Fed does short term loans with a financial asset as collateral is the same way that the private finance sector does … it enters into a contract to “buy” the financial asset at a set price, and the borrower agrees to “buy it back” at the end of the loan period for a set price. The up-front purchase price is the loan amount, and the difference between the two prices is the interest payment for the loan.

Now, if you are make a temporary bridging loan to a business backed by collateral, and you have to loan more than the collateral is really worth, that ought to raise a red flag that the business is in something more than a liquidity squeeze.

As explained by an anonymous banker friend of Jerome a Paris, that is the current crisis and the current proposal by the Bush administration, in a nutshell.

Crossposted to Agent Orange … please help make Susan Kraemer’s good work on this more visible. And click through to the article on the original site, vote it up and leave comments, so her boss knows that her hard work is appreciated.

I just read up on John McCain’s 50 Votes Against Clean Energy, on the MatteR Network⁽¹⁾.

The take home message is really straightforward. The only energy sector that John McCain supports is Nuclear Power. When a “clean”⁽²⁾ vote comes up for any Sustainable Energy Source, McCain’s position is simple: He’s Agin It.

It seems that the claim at the DNC that McCain voted against Renewable Power 25 times has been attacked by a fact checking web site, so what Susan Kraemer has done is go through 50 votes, and the picture is that of one of the dirtiest Sustainable Energy voting records in the Senate:

Summary

McCain voted with Boxer 1 out of 50 times – against signing the Kyoto protocol (vote 14). McCain voted with Inhofe 42 out of 44 times unless Inhofe voted with Boxer (see votes 34 and 35). McCain voted with Republicans unless the majority voted with Democrats  (see votes 9, 10, 12, 15,16 and 36). I will similarly review Senator Obama’s voting record in a future post.

The full tally is 37 votes against, and, during his current run for the White House, Missing 13 times on bills where he has stated opposition.

The Take-Home message is: on Sustainable Energy, John McCain is Inhofe’s twin, and Boxer’s opposite.

The key factoid to be used here is the National Petroleum Reserve. 9.1b barrels of oil. As much or more than ANWR (h/t psychbob).

The sharp edge of the ax is the fact that everyone who is persuadable hates oil companies and their bloated profits.

The tie is simple: “9.1b barrels of barrels of the National Petroleum Reserve. As much or more than ANWR. So why do the Oil Companies want ANWR? Is it because they want the price of oil and gas to go down? Why would they want that?

Its because its cheaper to drill in ANWR, so it will give them more profits from the same amount of oil.

A world of one dominant power is an imperial world … to maintain its dominance that one dominant power must interfere with the affairs of those outside the boundaries of the metropole. It is an intrinsically imperial project, whether proudly so or, as in our case, it is an imperial project that must be pursued while paying lip service to self-determination and democratic expression.

A world of one dominance power is a world, therefore, of war.

But a multi-polar world is not necessarily a world of peace. It can be, under a balance of power, but there is no necessity that it shall be.

So today, it is casting the Beauty Platform for a Multi-Polar world at Peace. A lot of weight for one shiny and three tarnished copper coins to carry … I hope they do not get deformed under the stress, like the pennies that “those mischievous kids” used to put on the railroad tracks.

First draft edited using the excellent online editing tools at Agent Orange

Over the past two years, I’ve looked at several levels of rail in the nation’s transportation system

• “True” or “Very” High Speed Rail (HSR)
  
• “Express” HSR
  
• Rail/Air integration
  
• Rail/Bus Integration
  
• Rail/Bike Integration
  
• Long Distance / Local Rail Integration …
  

… but not as much on the coast to coast rail network. However, when on occasion one of my diaries struck a chord, the coast to coast rail network always came up. So with a Friday off, I’ll take a crack at it today.

For reference, this is the network proposed by the National Association of Railroad Passengers

Also available at the Red-Green-and-BlueStar

In a recent Burning the Midnight Oil (well, recent outside of the day-by-day time-scale of a hot primary fight), I thought a little bit about why progressive & populist is stronger than either alone.

Populism without progressivism risks pandering to the least common denominator of the prejudices and ignorances of a majority. And all too often, a populism built on ignorance becomes nothing more than a smokescreen for the beneficiaries of the status quo to hide behind.

Progressivism without populism risks leaving the majority behind, so that when the unintended (and unforseeable) consequences of reform are experienced, it becomes the point of leverage for the forces of reaction trying to undo the reform.

And thinking about the complementarity between progressivism and populism, where the two together are more than the sum of their parts, in combination with phrases I commonly repeat, it got me thinking about a different kind of potential complementarity.

Excerpted from Burning the Midnight Oil for Living Energy Independence (8 August 2008), in the Burning the Midnight Oil blog-within-a-blog, hosted by the EENR

Would California have HSR today if it had been settled by France? That’s what Michael Mahoney argued last Friday in the SFGate Open Forum.

The French, according to Mr. Mahoney, have a straightforward approach. The High Speed Rail train leaves the city on regular tracks running like an ordinary interurban express. When it gets out into the countryside, the HSR tracks start and it kicks up to full speed … 220mph and over, depending on the specific train. Then when it gets to into the urban area of its destination, it switches to regular tracks and back to running like an interurban express.

Most of the route is through the countryside, and that’s where its cheapest to build … both directly, and in terms of cutting down on the cost of overpasses.

SO … what did they do in California?

The Bureau of Labor Statistics re-organized their website, and it took me an extra four minutes to find out what the unemployment rate was for July.

Why would a re-organization slow down finding that info? Because I do not look for the “headline” or U3 measure of unemployment. I look for the “broad” or U6 measure, which takes into account those “marginally attached” to the labor force as well as those working part time who would rather be working full time.

You might not have ever seen these figures, so I’m going to try to copy the whole table, if it works … lessee, View/PageSource … uh … search for <table … copy, paste … come back to Docudharma … OK, here goes nothing …

Series Id:           LNS13327709
Seasonal Adjusted
Series title:        (seas) Total unemployed, plus all marginally attached workers plus total
                     employed part time for economic reasons, as a percent of all civilian labor
                     force plus all marginally attached workers
Labor force status:  Aggregated totals unemployed
Type of data:        Percent
Age:                 16 years and over
Percent/rates:       Unemployed and mrg attached and pt for econ reas as percent of labor force plus
                     marg attached

Yoopie! It Worked!

Now, this is seasonally adjusted … unadjusted given below (the figures are worse in summer and better at Christmas) …

Yup, even though GDP was up by a “healthy 1.9%” last quarter … broad unemployment rose from 9.1% before the start of 08Q2 to 9.9% at the end of 08Q2 … and July is up to 10.3%.

And, no, you won’t read these figures in the newspaper … newspapers go by the press release, they do not go looking for the alternate measures (maybe if they did, the alternate measures would be even harder to find).

Question: Peak Oil?

stable solid line | stable divided line | stable solid line

stable divided line | moving divided line | moving divided line

Earth over Fire evolving into Wind over Fire

36. Wounded Brightness	37. Family Members
Wounded brightness. Beneficial is laborious persistence. Being weakened. It is good to work diligently on the situation. (The brightness is the light of consciousness, one’s aliveness, one’s energy. It being injured means that one’s aliveness is diminished, one is being weakened.)	Family members. Beneficial is the women’s dedication. People are there for each other.

Moving Line 5:

Viscount of Ji’s hidden brightness.

It is beneficial to persist.

Tactfully feigning ignorance, in order to avoid being hurt by someone. It is a good idea to persist doing that. (The viscount of Ji feigned madness, in order to escape the abuses of a king.)

Line 6:

Not brightness, but darkness.

At first ascending to heaven,

then going into the earth.

Things seemed so bright at the start, but are turning unlucky.