Eeyore's news and view

One more day of patting each other on the back, then we can get back to politics as usual, of blaming the other party. I had run my mouth about it, i thought it would be closer, but such as life. Maybe now we can get back to normal, with election behind us, now we can get back to the real world. Hopefully. Here is some economic stuff, with everyone blaming America of course.

Medvedev: U.S. to blame for global financial crisis
MOSCOW (AP) — Russia's president says the United States is to blame for the global financial crisis — and presents his case in an online preview of his state-of-the-nation speech.
The highly anticipated speech Wednesday will be President Dmitry Medvedev's first state-of-the-nation address since taking office in May. A preview of the speech is available in a video posted on the Kremlin website.
Medvedev also says he will discuss the international consequences of the war in August that Russia fought with Georgia.
Medvedev has posted several videos on the Kremlin website. And his predecessor in the presidency, Prime Minister Vladimir Putin, this week unveiled a new website for himself.
http://www.usatoday.com/news/world/2008-11-03-russia-medvedev_N.htm

Repeat the Past (and then Some)?
In a post I wrote last Tuesday, "Worse this Time," I highlighted reasons set forth by Jim Rawles over at SurvivalBlog.com as to why the current downturn could more than rival the one that took place nearly 80 years ago.
As it happens, it isn't only bloggers who are discussing this possibility. Even some mainstream commentators are questioning the assumption that we are not doomed to repeat the past (and then some).
In an Op-Ed piece for the Financial Times' Economists' Forum, "It Can Be Worse than the Great Depression," Anders Aslund, an economist and Senior Fellow at the Peterson Institute for International Economics, offers up other reasons why the optimists might want to reconsider.
This is the worst global asset bubble and financial panic since the Great Depression of 1929–33. Still, almost all argue that it cannot become equally bad, because we have learned those lessons.
Analytically, that statement does not hold. True, our policymakers are not likely to repeat the same mistakes of the Great Depression, but they may commit other mistakes. Bank deposit insurance has come to stay for good, but not all advances represent progress, and many create new vulnerabilities.
One 1930s mistake was to defend exchange rates by all means. Today, most exchange rates float freely. Right now, we are seeing an unprecedented US dollar surge, which is not warranted by fundamentals but reflects a desperate search for a safe haven. The new hazard might be excessive and destabilizing exchange rate fluctuations caused by financial panic. If so, the major financial powers need to intervene to stabilize exchange rates.
Milton Friedman attacked the Fed for allowing the nominal monetary supply to contract sharply during the Depression, and John Maynard Keynes argued for more public expenditures through budget deficits, while the prevailing policy was budget surplus. The monetary expansion and budget deficits may become excessive this time.
Deficit spending and monetary expansion are supposed to boost demand, but people spend less in a financial panic, rendering increased public expenditures rather ineffective. We learned the limitation of Keynesianism in the 1970s. In recent decades, some former communist and Latin American countries have shown how the expansion of public expenditure beyond the permissible can lead to state default.
In the 1930s, states did not go bankrupt, fearful of the consequences of those who had done so in the wake of the First World War.
Now, major states, such as Italy, have public debt of more than 100 percent of GDP even before the crisis, rendering major state bankruptcies a real danger. Fiscal and monetary stimulation are needed and deflation must be avoided, but currently fiscal considerations are disregarded altogether, which is a recipe for disaster. State default can easily lead to hyperinflation, which is far worse than deflation.
The global financial system is so much deeper and more sophisticated than in the 1920s, but that is a problem. The 1920s had its version of subprime loans, but it did not have nontransparent collateralized debt obligations. The many derivatives have created the mother of all bubbles. The deeper the financial system, the harder we may fall.
Although the Great Depression had worldwide reach, it largely emanated from two countries, the United States and Germany. Never before has the world seen such a monstrous and truly global bubble. The real estate bubble is probably worst in the Persian Gulf and Moscow, while also extreme in Britain, Spain, and Ireland.
Never have big financial institutions been as overleveraged as Fannie Mae and Freddie Mac or the former US investment banks, not to mention the hedge funds. The excessive leverage is now being unwound by financial panic, apart from what is countered with recapitalization.
The 1930s protectionism must not be repeated, but frozen finances have already left countries such as Iceland and Ukraine temporarily outside of the world financial system. Such exclusion must not be allowed to become permanent.
In the 1920s, both the US dollar and gold were unchallenged sources of value. Today, the US dollar is neither stable nor an uncontested world currency. At 10, the euro is too young to be a debutant, and the biggest question is will it hold together in this rough financial weather, especially if one or several euro countries default.
Everybody from Milton Friedman to John Kenneth Galbraith has criticized the Federal Reserve and US President Herbert Hoover for their policies during the Depression, but at least they were policymakers and stood for principles. As if to illustrate their impotence, President George W. Bush is assembling the political leaders of the group of 20 large countries for a photo opportunity in Washington on November 15.
Their failure to come up with anything but vanity could unleash untold financial panic. This crisis envelops the whole world, but global financial governance is missing.
Finally, the 1920s had neither television nor the internet. Information, decisions, and implementation can now be carried out in seconds, which harms the quality of decisions and nerves. Transparency is usually preferable, but unmitigated speed might be harmful. CNBC and Bloomberg can spread worldwide panic instantly.
We must not repeat the mistakes of the Great Depression, but we need to ascertain that new policies are not even worse.
http://www.financialarmageddon.com/2008/11/repeat-the-past-and-then-some.html

Gold, faith and credit By The Mogambo Guru Like many people, I have been looking at the price disparity between the market prices of gold and silver bullion (averaging about US$1,000 an ounce for gold and $16.50 an ounce for silver) versus the prices of gold and silver futures (about $730 and $8.90 respectively), and I am thinking to myself that I would love to get a piece of that luscious arbitrage action where I buy the gold and/or silver futures at a low price while simultaneously selling the same gold and/or silver bullion at a higher price, telling the buyers that they must pay in advance and then wait up to a few months for me to deliver their gold and silver, pocketing a hell of a lot of money on the buy-sell spread and the interest the money earns until the futures contract matures so that I can take delivery andsettle up, and then spend the rest of my life on a wild, hedonistic spree of spending, spending, spending! Then, sadly, I remember that such a plan requires money, and I don't have any money because I have already spent all my money thanks to inflation in prices killing me, thanks to the damned Federal Reserve and the demonic, loathsome Alan Greenspan who was its chairman from 1987 to 2006, and who is directly responsible for all our economic problems; and every time I think about it, I get more angry, and I want to scream, scream, scream in my Anguish And Outrage (AAO)! I see that I have gotten off-track, and I apologize for starting off with an idea of how to make a lot of money by playing the huge, gaping, unbelievable arbitrage opportunity between gold and gold futures, but then let it degenerate into a personal attack on Alan Greenspan, ex-chairman of the Federal Reserve, whom I despise for what he has done to us, and who deserves some cruel punishment for it. Yet, I'm the one at the police station being held for "creating a disturbance" just because I helpfully informed a group of Girl Scouts at the supermarket to, as security video reveals, "Hang it up, you stupid kids, as your entire future has been destroyed first by the Federal Reserve under Alan Greenspan creating too much money and credit for almost two decades, and now Ben Bernanke at the Fed and Henry Paulson at the Treasury have grossly exceeded even those insane monetary excesses by huge, huge multiples of that! "And in a matter of weeks, too ... all of which guarantees roaring inflation and all its miseries and horrible, screaming pain and suffering for everyone, so that now you, and your parents, and your brothers, and sisters, and aunts and uncles and cousins and all the ponies and everyone you love will all die horrible, lingering, painful deaths of starvation and disease, crying out in ceaseless agony! Ya ever sing any songs about THAT around the campfires, you little doomed morons?" I was quite proud of myself that I had "gotten through" to them, as they all ran off, screaming in terror, just like I do when I hear about this stuff! "Congratulations, Mogambo!", I thought to myself! However, this is not about what you can and can't say to children, as it turns out, but about education; and for some reason, John Embry of Sprott Asset Management has never earned his Junior Mogambo Ranger (JMR) merit badge in "Mogambo Educational Initiatives (MEI)", and thus is also shocked and appalled at my teaching methods designed to make sure that little kids grow up having the correct information about the true nature of the Federal Reserve and the government. Apparently leaving the education of the masses to me and not getting tied up in the clutches of a vengeful legal system, Mr Embry is thus free to be both shocked at my behavior, and to concentrate on other things, like this glaring disparity between the futures contracts for gold and silver versus the market prices of gold and silver bullion; and he probably figures that there are lots of greedy little bastards like me out there who are looking to make a pile of money with this luscious arbitrage opportunity, which leads him to conclude that some holders of the December gold futures contracts may try to take delivery of enough contracts so that there will not be enough physical gold in the Comex warehouses to deliver! Rising demand and zero supply! Wow! What will that do to the price? Hahahaha! This would, of course, bust the whole "paper gold" and "paper silver" scam wide open on the commodities exchange, although Mr Embry is quick to note that this would "prompt a claim of force majeure when the exchange cannot deliver enough real metal", which is legalese for saying now that the crime has been uncovered, the commodity exchange negates the contracts, the guilty do not have to pay, nobody goes to jail or loses their jobs, and the investors get screwed out of the profits that they had coming to them. The hapless investors thought they were going to get gold and silver at a low price, deliver it to buyers who have already paid for it, and everybody makes a fortune when the price subsequently soars, thanks to governments around the world creating so incredibly much more money and credit so that governments can spend, spend, spend. But now these investors get (probably at best!) their money back; and probably only then after years of legal wrangling where the lawyers end up with most of the money anyway! Hahahaha! Welcome to the full faith and credit of American markets! Hahaha! If your nerves are on edge at the way I laugh so maniacally at such calamity, take comfort that gold will (theoretically, at least) soar when physical demand finally swamps physical supply, especially if the Europeans and Asians are serious about replacing the dollar as the world's reserve currency with something else, as there is nothing else that will work. One way or the other, for the last 4,500 years, gold has always preserved buying power, at least, while nothing else has, and sometimes gold was actually an investment opportunity because it was so under-priced. Like now! Whee! This investing
stuff is easy! Richard Daughty is general partner and COO for Smith Consultant Group, serving the financial and medical communities, and the editor of The Mogambo Guru economic newsletter - an avocational exercise to heap disrespect on those who desperately deserve it.

http://www.atimes.com/atimes/Global_Economy/JK01Dj03.html


HEALTHBEAT: Brain slows at 40, starts body decline November 3, 2008 - 3:39pm
By LAURAN NEERGAARD AP Medical Writer
WASHINGTON (AP) - Think achy joints are the main reason we slow down as we get older? Blame the brain, too: The part in charge of motion may start a gradual downhill slide at age 40. How fast you can throw a ball or run or swerve a steering wheel depends on how speedily brain cells fire off commands to muscles. Fast firing depends on good insulation for your brain's wiring.
Now new research suggests that in middle age, even healthy people begin to lose some of that insulation in a motor-control part of the brain _ at the same rate that their speed subtly slows.
That helps explain why "it's hard to be a world-class athlete after 40," concludes Dr. George Bartzokis, a neurologist at the University of California, Los Angeles, who led the work.
And while that may sound depressing, keep reading. The research points to yet another reason to stay physically and mentally active: An exercised brain may spot fraying insulation quicker and signal for repair cells to get to work.
To Bartzokis, the brain is like the Internet. Speedy movement depends on bandwidth, which in the brain is myelin, a special sheet of fat that coats nerve fibers.
Healthy myelin _ good thick insulation wound tightly around those nerve fibers _ allows prompt conduction of the electrical signals the brain uses to send commands. Higher-frequency electrical discharges, known as "actional potentials," speed movement _ any movement, from a basketball rebound to a finger tap.
Consider someone like Michael Jordan. "The circuitry that made him a great basketball player was probably myelinated better than most other mortals," Bartzokis notes.
But while myelin builds up during adolescence, when does production slow enough that we fall behind in the race to repair fraying, older insulation?
Enter the new research. First, Bartzokis recruited 72 healthy men, ages 23 to 80, to perform a simple test: How fast they tapped an index finger. Anyone can do this; it doesn't depend on strength or fitness.
Researchers counted how many taps the men made in 10 seconds, recording the two fastest of 10 attempts. Then, brain scans checked for myelin in need of repair in the region that orders a finger to tap.
Strikingly, tapping speed and myelin health both peaked at age 39. Then both gradually declined with increasing age, the researchers reported last month in the journal Neurobiology of Aging.
That doesn't mean the rest of the brain is equally affected. Bartzokis has some evidence that myelin starts to fray a decade or so later in brain regions responsible for cognitive functions _ higher-level thinking _ than in motor-control areas.
So back to his example of Jordan, who last played professionally at age 40: "Even he started getting older. That circuitry started breaking down a little," contends Bartzokis. "He can become Michael Jordan the big-shot businessman ... but not be Michael Jordan the super-duper basketball player anymore."
Bartzokis isn't looking to build a better athlete. His ultimate goal is to fight Alzheimer's disease. The connection: Building memories requires high-frequency electrical bursts, too, and Bartzokis' earlier research suggests an Alzheimer's-linked gene may thwart myelin repair.
But the new research has broader implications because it sheds light on normal aging, says Dr. Zoe Arvanitakis, a neurologist at Chicago's Rush University Medical Center.
"We knew at some age you peak and there's a sense it would disintegrate as you grow older. But we didn't have a sense of where that age would be," says Arvanitakis, who next wants to see if myelin and cognitive functions show a similar trajectory.
Bartzokis' research supports a recent report from German scientists, that with age comes a weakening of the system that's supposed to repair broken myelin, adds Dr. Bradley Wise of the National Institute on Aging.
"Any disruption in these neural circuits and networks will have problems for functioning," says Wise, who says the two reports are spurring increased interest into myelin's role in aging. Until recently, most myelin research has focused on multiple sclerosis, where myelin doesn't gradually degrade but disappears.
While much more research is needed, Bartzokis has some practical advice:
_Keeping active and treating high blood pressure, high cholesterol and diabetes already are deemed important for good brain health. But physical and mental activity also may stimulate myelin repair, while unused neural pathways wouldn't send out a "help" signal, he says.
"Remember, these are average people I tested," Bartzokis says. "Someone that's really practicing could make it (myelin) last longer because you're sending the signals to repair, repair, repair."
_Stress hormones, however, may hurt myelin.
_He's also testing whether consumption of omega-3 fatty acids _ the oils, found in fatty fish, already recommended for cardiovascular health _ might help maintain myelin.
___
EDITOR's NOTE _ Lauran Neergaard covers health and medical issues for The Associated Press in Washington.
http://wtop.com/?nid=106&sid=1510015