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Moonlapse

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Blog Comments posted by Moonlapse

    Moonlapse

    Posted

    That's exactly why, people pay attention to the Presidential campaign first and foremost. If a significant and noticeable percentage of people turn to 3rd parties, it will draw more attention to the alternatives. Those who do investigate and get politicized will logically understand that they will have to get involved locally in order to start to make a difference. Its an empty gesture in terms of the Presidency, but not as a signal of shifting ideology.

  11. docoflove1974

    Posted

    My wife's grandma is Italian, her parents were immigrants. She has the simplest yet savoriest spaghetti sauce I've ever had. Now that I've had it, most other sauces taste too sweet and overly seasoned. I don't know the exact quantities but it goes something like this:

     

    Mix up a small can of tomato paste, fresh garlic, and olive oil in your pan and get an oily wad of paste going. Cook this on low heat for a while, moving it constantly, until it darkens a bit like its been browned. This part can take a little while and if you over do it, it will ruin the taste. This will mellow out the flavor of the paste and get some good tomato garlic flavor into the oil. Slowly add a large can of plain tomato sauce and some chicken broth and make sure you mix up that wad of paste. Make it a little runny and just let it reduce for a bit. Towards the end, add a little bit of fresh basil, parsley, onion, and perhaps salt. A little goes a long way. Its not extravagant, but I think the flavor is perfect.

  12. docoflove1974

    Posted

    Shit yes. There's a pseudo-fast food restaurant chain in the area called Noodles & Co. and they used to have a dish called Mediterranean mixed grill. It was a plate with a little pasta, some fresh spinach, balsamic grilled meat (beef or chicken or both), cucumbers, red onions, kalamatas, feta, and some tzatziki to dress it with. They've since changed it to mostly shitty lettuce and pasta, but that original dish was one of my absolute favorite meals of all time. I would eat that every day if I could. I would also eat crab and lobster every day if possible.And German food. And fuckin ripe avacados with salt and pepper. And good beer. Ahhh jesus.

  14. docoflove1974

    Posted

    McCain seemed to be controlling the debate offensively, forcing Obama to defend himself most of the time. I think they both are skilled as politicians, but I guess that's just my euphemism for being able to make bullshit sound noble and patriotic and nationalistic and what-have-you. They talk about all the issues as if the office of President has the same influence over them as a dictator. The truth is, they both scare the shit out of me in their own ways, but if you'd ask me who is less evil, I'd say Obama. Even though I don't trust anything he says, he at least pays lip service to an anti-war ideal. McCain seems to want nothing more than to do whatever it takes to kick the shit out of anyone who gives the U.S. a sideways glance, in order to ensure our globally dominant position. For that, I think he's a total fucking idiot. It also my personal opinion that both of them know just enough about economics to be extremely dangerous in the same way that a 3 year old has enough knowledge to insert a hairpin into a wall socket. In fact, pretty much every politician falls under that category.

  15. docoflove1974

    Posted

    Actually it would have stopped the Fed from pumping credit into these GSE institutions which the government itself had urged to expand sub-prime lending. It would have effectively put the brakes on the housing bubble in 2003 and caused a long overdue corrective recession (provided that the Fed didn't find a way to blow up another bubble).

     

    The tax exemption concerns this clause of the Federal National Mortgage Association Charter Act:

    The corporation, including its franchise, capital, reserves, surplus, mortgages or other security holdings, and

    income, shall be exempt from all taxation now or hereafter imposed by any State, territory, possession,

    Commonwealth, or dependency of the United States, or by the District of Columbia, or by any county, municipality,

    or local taxing authority, except that any real property of the corporation shall be subject to State, territorial, county,

    municipal, or local taxation to the same extent as other real property is taxed.

    It's intended to eliminate an additional corporate subsidy in the guise of an exemption of all forms of local taxation. The exemption also helped insulate the corporation from anything but Federal influence. The act was basically design to strip all government largesse and special privileges from these pseudo-government institutions because they were being used as tools to channel the credit expansion into the housing market. The government now directly controls these institutions.

     

    There will be no choice but to rethink our lifestyles because our standards of living are going to take a few steps back, until we learn to get it right. With these bailouts and the sequence of events that they will unwind, the value of your money is going slip away like sand.

  16. docoflove1974

    Posted

    I think they should all wear circus clown suits as an official uniform. Just imagine Paulson saying those things with poofy orange hair, a little top hat,a big red nose, and painted tears leaking from his eyes. Bush's speech was a real crack-up, too.

     

    Poor lending standards are merely a proximate factor in our current predicament, not the ultimate. I'll attempt to give an incomplete and very abbreviated sequence of events which led to this point and maybe show why creating and enforcing mortgage lending regulations are like putting a band-aid on a bullet wound in your chest. And if you didn't have the bullet wound, you wouldn't need the band-aid.

     

    In 1995, the US bailed out the Mexican economy and Mexican bond holders. The Mexican crisis followed the massive credit expansion in the country from 1988-1994.

     

    The Reverse Plaza Accord of 1995 reversed the Plaza Accord of 1985. The Plaza Accord was an agreement by the G-5 to subsidize US exporters by artificially lowering the exchange rate of the dollar against the Yen and the Mark and thereby improving the profitability of US manufacturing. However, by 1995, Japanese manufacturing firms were faltering and many Japanese banks were facing insolvency.

     

    Instead of obviously bailing out another country in crisis, the Reverse Plaza Accord basically reversed the previous agreement and in effect subsidized American consumers' purchases of Japanese and German manufactured goods. This was accomplished by lowering Japanese interest rates and by huge purchases of instruments such as Treasury bonds by Japan, Germany, and the US in order to increase the exchange rate of the dollar against the Yen and the Mark. This,in effect, allowed the US to pursue inflationary monetary policies (credit expansion) during the late nineties without a rise in CPI figures, due to the suppression of prices levels by the artificially low prices of imports.

     

    The Bank of Japan cut its discount rate to 0.5% which created guaranteed profits by borrowing Yen at the low rates, then bringing the money to the US market to reinvest at a higher yeild. Also, other Asian governments were now purchasing much larger quantities of US government securities.

     

    At the same time, tech IPOs starting with Netscape were popping up and literally making people extremely rich overnight. It was not uncommon for these offerings to double on their first day of trading. It was this historical contingency that drew so much of the credit expansion into the dot-com boom.

     

    The Fed started cutting interest rates in July and kept them relatively low throughout the late Nineties despite the fact that the Fed had met its goal of 'full employment' (5-6% unemployment). One of the justifications for doing so was that the computer revolution had made labor so much more productive and therefore increased labor demand to point that it dropped the full employment rate much lower. It had supposely also ushered in some kind of new economic evolution which made old economic principles obsolete and allowed for the simultaneous achievement of low interest rates, low inflation, low unemployment, and sustainable economic growth without any busts. Greenspan even came up with some simplistic function that was supposed to empirically prove and mathematically necessitate the point.

     

    Many East Asian companies who has pegged their currencies to the dollar were now being affected by the Reverse Plaza Accord by making it increasing difficult to compete with the Japanese competitors being subsidized by the agreement. By pegging their currencies, they were actually helping to pay their competitor's subsidies. However, unpegging the currencies would cause these currencies to drop against the dollar and thereby magnify the cost of their debt to the US and negatively affect credit. The end result when they eventually unpegged was a reversal from $93 billion of capital flowing in to the region to $12 billion of capital flowing out of the region during the course of 1997.

     

    In 1998, Russia defaulted on its debt, much of it held by US investment banks. Brazil had its own financial crisis and the Y2K scare really started rolling. When the Long-Term Capital Management hedge fund in the US started to fail, the Fed reacted with three consecutive rate cuts, one of which was announced between Fed meetings at a finacially strategic point in time in regards to stock options, which I won't discuss. The Fed also prompted GSEs like Fannie and Freddie to drastically start stepping up their borrowing and lending activities. The rate of increase of MZM (a measure of money supply) was 15% in 1998 compared to about 2.5% just a few years earlier. It hit over 20% in 2001.

     

    In 1999 alone, the NASDAQ Composite (the primary stock exchange for tech firms) rose more than 80%. By 2000, the personal savings rate was negative... something unprecedented in the previous half century. This meant that regular consumers were spending more than they earned by relying on credit. The essence of this is that people were consuming future wealth; foregoing future consumption for immediate consumption. Debt as a proportion of personal disposable income was 97%. In the absence of savings, all credit must be produced by the creation of new quantities of fiat money or fiduciary media.

     

    In less than six month during late 1999 and early 2000, the NASDAQ rose 83%. During this time, the pinnacle of Y2K, the Fed engaged in money pumping sufficient enough to deviate the Federal Funds Rate from its target of 5.5% to below 4%. More than 50% of new mortgages had less than a 10% down payment and mortgage refinancing into lower interest rates became almost rampant.

     

    After Y2K turned out to be a non-event, the Fed started to increase its rates to try to bring the credit frenzied market under control. However, with negative savings and a market with its foundation in a long streak of constantly accelerating credit expansion, this was obviously the needle in a very large balloon. Many tech companies riding this wave were completely invalid and had no real way of generating a real profit, except when credit was pouring in; something supposedly assured by the "New Economy" - the 90's version of the New Plateau of Prosperity of the 20's.

     

    In 2001, facing yet another crisis brought on by the Dot-Com bust along with the September 11th attacks, the Fed started dropping the Federal Funds Rate back down from 6% to 1.75% over the course of that year. The Fed kept it under 2% until December 2004. Consumer spending was supported by massive mortgage refinancing, home equity lines of credit, and zero interest auto loans. Take a look at these articles from 1999 and 2001:

     

    http://query.nytimes.com/gst/fullpage.html...75AC0A96F958260

    http://query.nytimes.com/gst/fullpage.html...752C1A9679C8B63

     

    If you want to see the source of our current crisis, look no further.

     

    Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

     

    In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates -- anywhere from three to four percentage points higher than conventional loans.

     

    "Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements," said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. "Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market."

     

    I can boil this all down into something very simple: Intervention -> Boom -> Unintended Consequences -> Crisis -> Intervention -> Boom -> Unintended Consequences -> Crisis -> Intervention -> Boom -> Unintended Consequences -> Crisis -> and on and on until everything is eventually nationalized. The housing boom was the means of recovery from the Dot-Com boom. If you want to take the time to study this, you can go all the way back to the inception of the Federal Reserve in 1913. There is no fix other than letting the system fail now and suffering the harsh consequences, or continuing the same cycle of postponement and ultimately suffering much harsher consequences. In an election year, the former is never an option.

     

    A good metaphor would be a heroin junkie. He can quit now and go through a very hard time as he withdraws and rebuilds his life, or he can keep going for that next fix and eventually put himself in the grave and affect the lives of everyone around him. We 'need to' pass this bailout plan just like a junkie 'needs to' get more smack. We know its not good, but we can't keep going on the same way without it. I believe a system with a commodity currency like gold AND a 100% reserve requirement on demand deposits (something that has always been absent from our economy, but was an established legal principle in Rome) would spell the end of this crap. No artificial credit expansion through fiat currency printing and risky fractional-reserve banking, no massive-scale malinvestment, and no need for deposit insurance.

     

    If you want to read something interesting take a look at Ron Paul's address to the House Financial Services Committee on September 10, 2003. Here is the proposed act, which died immediately. Think about what you were doing in 2003... at least one person had the foresight and principles to try to prevent this.

  25. Moonlapse

    Posted

    I tried to install Ubuntu 8.04 but apparently it messed with my video drivers..

    At first it did not detect my screen, so I tried to go back to generic drivers but it didn't help much..I had a screen resolution of 800x600 and couldn't change it. I guess it's just me not being able to set it up properly...

    What video card? When I installed it on a laptop with ATI graphics and I had to install xserver-xgl. It also did not display the splash screen because of the laptop's uncommon screen resolution, so I updated the setting in /etc/usplash.conf

     

    So far I've found all the information I've needed here: http://ubuntuforums.org/

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