IT’S NOT OVER – HERE’S WHY (NO NUMBERS NEEDED) Eugene Linden : endangered animals, rapid climate change, global deforestation, fragging

THE HAMMER OF THOR… AND LIZ AND BARBRA AND GEORGE AND KAMALA

Lately, I’ve returned to my roots in investigative journalism. I’m trying to get to the bottom to a recurrent episode of collective madness where every four years a marauding posse of celebrities, media figures, and supreme court justices go rampaging through the political landscape w...

IT’S NOT OVER – HERE’S WHY (NO NUMBERS NEEDED)

Sunday April 19, 2009

Eugene Linden THE U.S. CONSUMER IS STILL DROWNING IN DEBT: Job prospects are dire. Households can’t pay existing debt, much less get credit. IT WILL GET WORSE: Alt- A/Option Arm resets are just hitting. Commercial Real Estate defaults loom. Before consumer spending can pick up, several trillion in debt has to be re-negotiated or discounted. Until then we will have Zombie consumers and Zombie banks. NEEDFUL THINGS: 1) Debt relief – preferably by process, but debt repudiation through easing or inflation will reduce debts if no one does anything else. 2) Restart credit as best we cant – Borrowing is now at half pre-recession levels, but lending will not return to credit bubble level. The securitization process (the “shadow banking system”) that accounted for close to half of bubble-era lending is dead and very unlikely to get back to previous levels. 3) A much bigger stimulus -- get people back to work so they qualify for credit. 4) C2Someone to buy the things Americans can produce -- until we identify a credible engine of growth, talk of recovery is wishful thinking. INSTEAD, WE HAVE: 1) Massive programs to benefit the bondholders of zombie banks. 2) A PPiP that will not restart lending, but=2 0will be gamed by banks and investors. It may also suck dry the FDIC, which was established to protect depositors. 3) Cosmetic, backward-looking initiatives that kick the can down the road. IN SUM: Some of the indebted are a lost cause, but mortgage modification should be a top priority: write down principal, convert ARMS to fixed, and give lenders “price appreciation rights,” or some other option. Revolving debt needs to be addressed too – through payment plans, principal reductions, etc. Or do something else, but let’s do something on the scale of the problem, and soon.

Short Take

The Laws of Physics for Babies

[I published this years ago, but with friends having babies, I thought it might be a useful resource]

THE LAWS OF PHYSICS FOR BABIES

Close observation of babies has led me to believe that the infant universe is characterized by its own physics, quite distinct from particle physics or the Newtonian laws of motion. I welcome and will periodically post suggestions about additional laws of the baby universe.

LAWS OF MOTION:

1) The Inflationary Universe: Obects tend to recede when you reach for them.

2) The Boomerang Effect: Once successfully grabbed, however, objects usually reappear after being thrown, with the special exception of objects made of glass or metal.

3) The Relativity of Gravity:

a) Gravity and Acoustics. Gravity can be temporarily reversed by generating noises, but only in the presence of other people. The speed of this reversal is directly proportional to the decibel level of the sounds generated.

b) Gravity and Context. Gravity spontaneously and unexpectedly reverses itself when approaching stairs, antiques, and the Thanksgiving dinner table.

FLUID DYNAMICS: 1) Animal Spirits: Fluids have a vital forces that causes them to splash and spill unless contained in bottles and sippy cups.

MATERIALS PHYSICS:

1) Conservation of Shape: Once broken or bent, objects tend to reappear in their original configutation.

2) Transformation: When reached for, shiny metal objects tend to recede and then become transformed into plastic or rubber.

GRAND UNIFYING CONSTANT: The Attractive Pull of Mommy: the one universal force.