Saturday, May 30, 2009


Wednesday, May 27, 2009

Dump The US Dollar

The mighty US dollar has posted prolific losses against many major currencies that began back in March but have kicked into high gear the past two weeks. This week so far, the dollar has fallen 4% against the British pound reaching a new low for 2009, 3% against the euro and Japanese yen, and also against the Canadian dollar. With major price levels being broken, many banks are reevaluating year end predictions for the euro vs. the dollar to reach $1.50 or higher. Is this going to be the new trend of 2009, dollar's death spiral? Here's some reasons why many say its time to chuck the buck:

1. The US Federal Reserve is printing money faster than you can shake a stick at. It is called quantitative easing and it ain't pretty. It is the US government's last resort to somehow kick start this economy and it is very controversial. The turn in the dollar's rise occurred in March when the US announced it would purchase US treasuries to the tune of $300bn. Since then they continue on the same track, announcing on Wednesday that they will consider additional asset purchases as long as necessary to drag the US out of this economic quagmire. Meanwhile, the dollar will continue to devalue against all major currencies as long as the US continues this policy.

2. Russia has recently made the Euro its reserve currency, over the dollar. Other countries like China and Brazil have been hinting at doing the same. A lack of enthusiasm for the US currency has many global leaders calling for a new reserve currency or a basket of currencies to take over for the dollar.

3. With the recession and slow economic recovery, the Fed cannot raise interest rates. The dollar will likely continue its fall until the US is able to raise interest rates again, which most economists agree will not be able to happen until possibly in 2010. The question remains: how will the dollar's weakness play out against the other major currencies since this is a global economic meltdown, affecting all countries and currencies? Will the dollar be the weakest since, so far, the US has been much more aggressive with its quantitative easing measures?

4. This week investors are beginning to question the dollar's status as a "safe haven", looking to other avenues like gold. On Thursday the price of gold reached $955/oz up $16, and up $25 so far this week. Standard and Poor's rating agency warned the UK of a possible downgrading of its AAA status due to its incredibly high debt to GDP ratio, which it said may near 100%. This caused alarm that the US may be next. Though most agree that the US's debt ratio is nothing compared to that of the UK or of Japan, which is at 110%, still S&P is expecting the US ratio to reach 77% in the coming years.

The dollar has been the instrument of choice the past 8 months, a safe haven for investors, and surprising some at its apparent strength while stocks slid during the crisis. If in fact the dollar has lost its luster, where will investors look when risk aversion returns? For forex trend traders, this is a dream come true. For overseas exporters, not so much. The dollar index reached 80.40 today, 79.00 is the next major support, below that the all time low at 74.60.

Source - The Examiner


Chinese Concern - America Printing Money

Richard Fisher, president of the Dallas Federal Reserve Bank, said: "Senior officials of the Chinese government grilled me about whether or not we are going to monetise the actions of our legislature."

"I must have been asked about that a hundred times in China. I was asked at every single meeting about our purchases of Treasuries. That seemed to be the principal preoccupation of those that were invested with their surpluses mostly in the United States," he told the Wall Street Journal.

His recent trip to the Far East appears to have been a stark reminder that Asia's "Confucian" culture of right action does not look kindly on the insouciant policy of printing money by Anglo-Saxons.

Mr Fisher, the Fed's leading hawk, was a fierce opponent of the original decision to buy Treasury debt, fearing that it would lead to a blurring of the line between fiscal and monetary policy – and could all too easily degenerate into Argentine-style financing of uncontrolled spending.

However, he agreed that the Fed was forced to take emergency action after the financial system "literally fell apart".

Nor, he added was there much risk of inflation taking off yet. The Dallas Fed uses a "trim mean" method based on 180 prices that excludes extreme moves and is widely admired for accuracy.

"You've got some mild deflation here," he said.

The Oxford-educated Mr Fisher, an outspoken free-marketer and believer in the Schumpeterian process of "creative destruction", has been running a fervent campaign to alert Americans to the "very big hole" in unfunded pension and health-care liabilities built up by a careless political class over the years.

"We at the Dallas Fed believe the total is over $99 trillion," he said in February.

"This situation is of your own creation. When you berate your representatives or senators or presidents for the mess we are in, you are really berating yourself. You elect them," he said.

His warning comes amid growing fears that America could lose its AAA sovereign rating.

Source - Telegraph

Sunday, May 24, 2009


Ecuador - Resource Nationalism

Ecuador's President Rafael Correa said on Saturday that key sectors of the economy, including oil and mines, must be in government hands.

During his first two years in office Correa has taken a tough stand with mining and oil companies, pushing for new contracts more favorable to the state, but has so far shied away from nationalizing any firms.

"We will fulfill the goal of having strategic sectors in government hands," Correa said.

The U.S.-educated economist has recently said he will not nationalize foreign oil companies, but will push for more state control in the key industry via new contracts.

During a joint news conference with his Ecuadorean counterpart, Venezuelan President Hugo Chavez said his drive to nationalize strategic sectors of his own country's economy would continue.

Many sectors of Venezuela's economy, including energy and telecommunications, have passed into state hands since Chavez took office 10 years ago. In recent weeks he has nationalized oil service companies and iron producers.

Chavez also said that Venezuela and Brazil were in talks to create a joint fund worth billions of dollars. It is likely it would be for infrastructure investment.

"One of the subjects we will discuss is the creation of a joint strategic fund ... worth billions of dollars," said Chavez, adding the fund will have funds from the Brazilian Development Bank, BNDES. He said he will meet with Brazilian President Luiz Inacio Lula da Silva next week.

He said earlier his country and Ecuador had signed a deal for a joint fund for investment in energy projects.

Source - Reuters


Meditation - Why Bother?

Meditation is not easy. It takes time and it takes energy. It also takes grit, determination and discipline. It requires a host of personal qualities which we normally regard as unpleasant and which we like to avoid whenever possible. We can sum it all up in the American word 'gumption'. Meditation takes 'gumption'. It is certainly a great deal easier just to kick back and watch television. So why bother? Why waste all that time and energy when you could be out enjoying yourself? Why bother? Simple. Because you are human. And just because of the simple fact that you are human, you find yourself heir to an inherent unsatisfactoriness in life which simply will not go away. You can suppress it from your awareness for a time. You can distract yourself for hours on end, but it always comes back--usually when you least expect it. All of a sudden, seemingly out of the blue, you sit up, take stock, and realize your actual situation in life.

There you are, and you suddenly realize that you are spending your whole life just barely getting by. You keep up a good front. You manage to make ends meet somehow and look OK from the outside. But those periods of desperation, those times when you feel everything caving in on you, you keep those to yourself. You are a mess. And you know it. But you hide it beautifully. Meanwhile, way down under all that you just know there has got be some other way to live, some better way to look at the world, some way to touch life more fully. You click into it by chance now and then. You get a good job. You fall in love. You win the game. and for a while, things are different. Life takes on a richness and clarity that makes all the bad times and humdrum fade away. The whole texture of your experience changes and you say to yourself, "OK, now I've made it; now I will be happy". But then that fades, too, like smoke in the wind. You are left with just a memory. That and a vague awareness that something is wrong.

But there is really another whole realm of depth and sensitivity available in life, somehow, you are just not seeing it. You wind up feeling cut off. You feel insulated from the sweetness of experience by some sort of sensory cotton. You are not really touching life. You are not making it again. And then even that vague awareness fades away, and you are back to the same old reality. The world looks like the usual foul place, which is boring at best. It is an emotional roller coaster, and you spend a lot of your time down at the bottom of the ramp, yearning for the heights.

So what is wrong with you? Are you a freak? No. You are just human. And you suffer from the same malady that infects every human being. It is a monster in side all of us, and it has many arms: Chronic tension, lack of genuine compassion for others, including the people closest to you, feelings being blocked up, and emotional deadness. Many, many arms. None of us is entirely free from it. We may deny it. We try to suppress it. We build a whole culture around hiding from it, pretending it is not there, and distracting ourselves from it with goals and projects and status. But it never goes away. It is a constant undercurrent in every thought and every perception; a little wordless voice at the back of the head saying, "Not good enough yet. Got to have more. Got to make it better. Got to be better." It is a monster, a monster that manifests everywhere in subtle forms.

Go to a party. Listen to the laughter, that brittle-tongued voice that says fun on the surface and fear underneath. Feel the tension, feel the pressure. Nobody really relaxes. They are faking it. Go to a ball game. Watch the fan in the stand. Watch the irrational fit of anger. Watch the uncontrolled frustration bubbling forth from people that masquerades under the guise of enthusiasm, or team spirit. Booing, cat-calls and unbridled egotism in the name of team loyalty. Drunkenness, fights in the stands. These are the people trying desperately to release tension from within. These are not people who are at peace with themselves. Watch the news on TV. Listen to the lyrics in popular songs. You find the same theme repeated over and over in variations. Jealousy, suffering, discontent and stress.

Life seems to be a perpetual struggle, some enormous effort against staggering odds. And what is our solution to all this dissatisfaction? We get stuck in the ' If only' syndrome. If only I had more money, then I would be happy. If only I can find somebody who really loves me, if only I can lose 20 pounds, if only I had a color TV, Jacuzzi, and curly hair, and on and on forever. So where does all this junk come from and more important, what can we do about it? It comes from the conditions of our own minds. It is deep, subtle and pervasive set of mental habits, a Gordian knot which we have built up bit by bit and we can unravel just the same way, one piece at a time. We can tune up our awareness, dredge up each separate piece and bring it out into the light. We can make the unconscious conscious, slowly, one piece at a time.

The essence of our experience is change. Change is incessant. Moment by moment life flows by and it is never the same. Perpetual alteration is the essence of the perceptual universe. A thought springs up in your head and half a second later, it is gone. In comes another one, and that is gone too. A sound strikes your ears and then silence. Open your eyes and the world pours in, blink and it is gone. People come into your life and they leave again. Friends go, relatives die. Your fortunes go up and they go down. Sometimes you win and just as often you lose. It is incessant: change, change, change. No two moments ever the same.

There is not a thing wrong with this. It is the nature of the universe. But human culture has taught us some odd responses to this endless flowing. We categorize experiences. We try to stick each perception, every mental change in this endless flow into one of three mental pigeon holes. It is good, or it is bad, or it is neutral. Then, according to which box we stick it in, we perceive with a set of fixed habitual mental responses. If a particular perception has been labeled 'good', then we try to freeze time right there. We grab onto that particular thought, we fondle it, we hold it, we try to keep it from escaping. When that does not work, we go all-out in an effort to repeat the experience which caused that thought. Let us call this mental habit 'grasping'.

Over on the other side of the mind lies the box labeled 'bad'. When we perceive something 'bad', we try to push it away. We try to deny it, reject it, get rid of it any way we can. We fight against our own experience. We run from pieces of ourselves. Let us call this mental habit 'rejecting'. Between these two reactions lies the neutral box. Here we place the experiences which are neither good nor bad. They are tepid, neutral, uninteresting and boring. We pack experience away in the neutral box so that we can ignore it and thus return our attention to where the action is, namely our endless round of desire and aversion. This category of experience gets robbed of its fair share of our attention. Let us call this mental habit 'ignoring'. The direct result of all this lunacy is a perpetual treadmill race to nowhere, endlessly pounding after pleasure, endlessly fleeing from pain, endlessly ignoring 90 percent of our experience. Then wondering why life tastes so flat. In the final analysis, it's a system that does not work.

No matter how hard you pursue pleasure and success, there are times when you fail. No matter how fast you flee, there are times when pain catches up with you. And in between those times, life is so boring you could scream. Our minds are full of opinions and criticisms. We have built walls all around ourselves and we are trapped with the prison of our own lies and dislikes. We suffer. Suffering is a big word in Buddhist thought. It is a key term and it should be thoroughly understood. The Pali word is 'dukkha', and it does not just mean the agony of the body. It means the deep, subtle sense of unsatisfactoriness which is a part of every mental treadmill. The essence of life is suffering, said the Buddha. At first glance this seems exceedingly morbid and pessimistic. It even seems untrue. After all, there are plenty of times when we are happy. Aren't there? No, there are not. It just seems that way. Take any moment when you feel really fulfilled and examine it closely. Down under the joy, you will find that subtle, all-pervasive undercurrent of tension, that no matter how great the moment is, it is going to end. No matter how much you just gained, you are either going to lose some of it or spend the rest of your days guarding what you have got and scheming how to get more. And in the end, you are going to die. In the end, you lose everything. It is all transitory.

Sounds pretty bleak, doesn't it? Luckily it's not; not at all. It only sounds bleak when you view it from the level of ordinary mental perspective, the very level at which the treadmill mechanism operates. Down under that level lies another whole perspective, a completely different way to look at the universe. It is a level of functioning where the mind does not try to freeze time, where we do not grasp onto our experience as it flows by, where we do not try to block things out and ignore them. It is a level of experience beyond good and bad, beyond pleasure and pain. It is a lovely way to perceive the world, and it is a learnable skill. It is not easy, but is learnable.

Happiness and peace. Those are really the prime issues in human existence. That is what all of us are seeking. This often is a bit hard to see because we cover up those basic goals with layers of surface objectives. We want food, we want money, we want sex, possessions and respect. We even say to ourselves that the idea of 'happiness' is too abstract: "Look, I am practical. Just give me enough money and I will buy all the happiness I need". Unfortunately, this is an attitude that does not work. Examine each of these goals and you will find they are superficial. You want food. Why? Because I am hungry. So you are hungry, so what? Well if I eat, I won't be hungry and then I'll feel good. Ah ha! Feel good! Now there is a real item. What we really seek is not the surface goals. They are just means to an end. What we are really after is the feeling of relief that comes when the drive is satisfied. Relief, relaxation and an end to the tension. Peace, happiness, no more yearning.

So what is this happiness? For most of us, the perfect happiness would mean getting everything we wanted, being in control of everything, playing Caesar, making the whole world dance a jig according to our every whim. Once again, it does not work that way. Take a look at the people in history who have actually held this ultimate power. These were not happy people. Most assuredly they were not men at peace with themselves. Why? Because they were driven to control the world totally and absolutely and they could not. They wanted to control all men and there remained men who refused to be controlled. They could not control the stars. They still got sick. They still had to die.

You can't ever get everything you want. It is impossible. Luckily, there is another option. You can learn to control your mind, to step outside of this endless cycle of desire and aversion. You can learn to not want what you want, to recognize desires but not be controlled by them. This does not mean that you lie down on the road and invite everybody to walk all over you . It means that you continue to live a very normal-looking life, but live from a whole new viewpoint. You do the things that a person must do, but you are free from that obsessive, compulsive drivenness of your own desires. You want something, but you don't need to chase after it. You fear something, but you don't need to stand there quaking in your boots. This sort of mental culture is very difficult. It takes years. But trying to control everything is impossible, and the difficult is preferable to the impossible.

Wait a minute, though. Peace and happiness! Isn't that what civilization is all about? We build skyscrapers and freeways. We have paid vacations, TV sets. We provide free hospitals and sick leaves, Social Security and welfare benefits. All of that is aimed at providing some measure of peace and happiness. Yet the rate of mental illness climbs steadily, and the crime rates rise faster. The streets are crawling with delinquents and unstable individuals. Stick your arms outside the safety of your own door and somebody is very likely to steal your watch! Something is not working. A happy man does not feel driven to kill. We like to think that our society is exploiting every area of human knowledge in order to achieve peace and happiness. We are just beginning to realize that we have overdeveloped the material aspect of existence at the expense of the deeper emotional and spiritual aspect, and we are paying the price for that error. It is one thing to talk about degeneration of moral and spiritual fiber in America today, and another thing to do something about it. The place to start is within ourselves. Look carefully inside, truly and objectively, and each of us will see moments when "I am the punk" and "I am the crazy". We will learn to see those moments, see them clearly, cleanly and without condemnation, and we will be on our way up and out of being so.

You can't make radical changes in the pattern of your life until you begin to see yourself exactly as you are now. As soon as you do that, changes flow naturally. You don't have to force or struggle or obey rules dictated to you by some authority. You just change. It is automatic. But arriving at the initial insight is quite a task. You've got to see who you are and how you are, without illusion, judgement or resistance of any kind. You've got to see your own place in society and your function as a social being. You've got to see your duties and obligations to your fellow human beings, and above all, your responsibility to yourself as an individual living with other individuals. And you've got to see all of that clearly and as a unit, a single gestalt of interrelationship. It sounds complex, but it often occurs in a single instant. Mental culture through meditation is without rival in helping you achieve this sort of understanding and serene happiness.

The Dhammapada is an ancient Buddhist text which anticipated Freud by thousands of years. It says: "What you are now is the result of what you were. What you will be tomorrow will be the result of what you are now. The consequences of an evil mind will follow you like the cart follows the ox that pulls it. The consequences of a purified mind will follow you like your own shadow. No one can do more for you than your own purified mind-- no parent, no relative, no friend, no one. A well-disciplined mind brings happiness".

Meditation is intended to purify the mind. It cleanses the thought process of what can be called psychic irritants, things like greed, hatred and jealousy, things that keep you snarled up in emotional bondage. It brings the mind to a state of tranquility and awareness, a state of concentration and insight.

In our society, we are great believers in education. We believe that knowledge makes a cultured person civilized. Civilization, however, polishes the person superficially. Subject our noble and sophisticated gentleman to stresses of war or economic collapse, and see what happens. It is one thing to obey the law because you know the penalties and fear the consequences. It is something else entirely to obey the law because you have cleansed yourself from the greed that would make you steal and the hatred that would make you kill. Throw a stone into a stream. The running water would smooth the surface, but the inner part remains unchanged. Take that same stone and place it in the intense fires of a forge, and the whole stone changes inside and outside. It all melts. Civilization changes man on the outside. Meditation softens him within, through and through.

Meditation is called the Great Teacher. It is the cleansing crucible fire that works slowly through understanding. The greater your understanding, the more flexible and tolerant you can be. The greater your understanding, the more compassionate you can be. You become like a perfect parent or an ideal teacher. You are ready to forgive and forget. You feel love towards others because you understand them. And you understand others because you have understood yourself. You have looked deeply inside and seen self illusion and your own human failings. You have seen your own humanity and learned to forgive and to love. When you have learned compassion for yourself, compassion for others is automatic. An accomplished meditator has achieved a profound understanding of life, and he inevitably relates to the world with a deep and uncritical love.

Meditation is a lot like cultivating a new land. To make a field out of a forest, first you have to clear the trees and pull out the stumps. Then you till the soil and you fertilize it. Then you sow your seed and you harvest your crops. To cultivate your mind, first you have to clear out the various irritants that are in the way, pull them right out by the root so that they won't grow back. Then you fertilize. You pump energy and discipline in the mental soil. Then you sow the seed and you harvest your crops of faith, morality , mindfulness and wisdom.

Faith and morality, by the way, have a special meaning in this context. Buddhism does not advocate faith in the sense of believing something because it is written in a book or attributed to a prophet or taught to you by some authority figure. The meaning here is closer to confidence. It is knowing that something is true because you have seen it work, because you have observed that very thing within yourself. In the same way, morality is not a ritualistic obedience to some exterior, imposed code of behavior. The purpose of meditation is personal transformation. The you that goes in one side of the meditation experience is not the same you that comes out the other side. It changes your character by a process of sensitization, by making you deeply aware of your own thoughts, word, and deeds. Your arrogance evaporated and your antagonism dries up. Your mind becomes still and calm. And your life smoothes out. Thus meditation properly performed prepares you to meet the ups and down of existence. It reduces your tension, your fear, and your worry. Restlessness recedes and passion moderates. Things begin to fall into place and your life becomes a glide instead of a struggle. All of this happens through understanding.

Meditation sharpens your concentration and your thinking power. Then, piece by piece, your own subconscious motives and mechanics become clear to you. Your intuition sharpens. The precision of your thought increases and gradually you come to a direct knowledge of things as they really are, without prejudice and without illusion. So is this reason enough to bother? Scarcely. These are just promises on paper. There is only one way you will ever know if meditation is worth the effort. Learn to do it right, and do it. See for yourself.

Source - Vipassana

Friday, May 22, 2009


US Military - Armed & Medicated

Marine Corporal Michael Cataldi woke as he heard the truck rumble past. He opened his eyes, but saw nothing. It was the middle of the night, and he was facedown in the sands of western Iraq. His loaded M16 was pinned beneath him.

Cataldi had no idea how he'd gotten to where he now lay, some 200 meters from the dilapidated building where his buddies slept. But he suspected what had caused this nightmare: His Klonopin prescription had run out.

His ordeal was not all that remarkable for a person on that anti-anxiety medication. In the lengthy labeling that accompanies each prescription, Klonopin users are warned against abruptly stopping the medicine, since doing so can cause psychosis, hallucinations, and other symptoms. What makes Cataldi's story extraordinary is that he was a U. S. Marine at war, and that the drug's adverse effects endangered lives — his own, his fellow Marines', and the lives of any civilians unfortunate enough to cross his path.

"It put everyone within rifle distance at risk," he says.

In deploying an all-volunteer army to fight two ongoing wars, in Iraq and Afghanistan, the Pentagon has increasingly relied on prescription drugs to keep its warriors on the front lines. In recent years, the number of military prescriptions for antidepressants, sleeping pills, and painkillers has risen as soldiers come home with battered bodies and troubled minds. And many of those service members are then sent back to war theaters in distant lands with bottles of medication to fortify them.

According to data from a U. S. Army mental-health survey released last year, about 12 percent of soldiers in Iraq and 15 percent of those in Afghanistan reported taking antidepressants, anti-anxiety medications, or sleeping pills. Prescriptions for painkillers have also skyrocketed. Data from the Department of Defense last fall showed that as of September 2007, prescriptions for narcotics for active-duty troops had risen to almost 50,000 a month, compared with about 33,000 a month in October 2003, not long after the Iraq war began.

In other words, thousands of American fighters armed with the latest killing technology are taking prescription drugs that the Federal Aviation Administration considers too dangerous for commercial pilots.

Military officials say they believe many medications can be safely used on the battlefield. They say they have policies to ensure that drugs they consider inappropriate for soldiers on the front lines are rarely used. And they say they are not using the drugs in order to send unstable warriors back to war.

Yet the experience of soldiers and Marines like Cataldi show the dangers of drugging warriors. It also worries some physicians and veterans' advocates. "There are risks in putting people back to battle with medicines in their bodies," says psychiatrist Judith Broder, M. D., founder of the Soldiers Project, a group that helps service members suffering from mental illness.

Source - Information Clearing House

Thursday, May 21, 2009

Red Alert

Beginning Of A 10-Year Decline?

The green shoots story took a bit of hit this week between data on April retail sales, weekly jobless claims and foreclosures. But the whole concept of the economy finding its footing was "preposterous" to begin with, says Howard Davidowitz, chairman of Davidowitz & Associates.

"We're in a complete mess and the consumer is smart enough to know it," says Davidowitz, whose firm does consulting for the retail industry. "If the consumer isn't petrified, he or she is a damn fool."

Davidowitz, who is nothing if not opinionated (and colorful), paints a very grim picture: "The worst is yet to come with consumers and banks," he says. "This country is going into a 10-year decline. Living standards will never be the same."

This outlook is based on the following main points:

* With the unemployment rate rising into double digits - and that's not counting the millions of "underemployed" Americans - consumers are hitting the breaks, which is having a huge impact, given consumer spending accounts for about 70% of economic activity.
* Rising unemployment and the $8 trillion negative wealth effect of housing mean more Americans will default on not just mortgages but student loans and auto loans and credit card debt.
* More consumer loan defaults will hit banks, which are also threatened by what Davidowitz calls a "depression" in commercial real estate, noting the recent bankruptcy of General Growth Properties and distressed sales by Developers Diversified and other REITs.

As for all the hullabaloo about the stress tests, he says they were a sham and part of a "con game to get private money to finance these institutions because [Treasury] can't get more money from Congress. It's the ‘greater fool' theory."

"We're now in Barack Obama's world where money goes into the most inefficient parts of the economy and we're bailing everyone out," says Daviowitz, who opposes bailouts for financials and automakers alike. "The bailout money is in the sewer and gone."

Source - Yahoo

Wednesday, May 20, 2009


How Mad Men Spin The Recession

WHEN THE 1981-82 recession put a dent in steak sales, things could have gotten dicey for A1 Steak Sauce. Yet the 100-year-old brand turned adversity into great advertising. You might remember the TV spot: As a family sits around the dinner table, an incredulous kid catches sight of his uncle drowning a burger in A1. "Mom," the kid blurts out, "he's putting A1 Steak Sauce on his hamburger!" The boy's uncle responds, "My dear nephew, what is hamburger, chopped ham? No. It is chopped steak. And what tastes better on steak than A1?" And then the killer tagline: "A1 makes hamburgers taste like steakburgers."

It was brilliant repositioning. In one bold stroke, A1 shed its filet mignon pedigree in favor of a recession-proof staple. (And it's been there ever since; Burger King's $3.79 Steakhouse Burger is slathered in the sauce.) This episode illustrates the cardinal rule of recession marketing: When life gives you hamburger, make chopped steak.

If only it were still so easy. After years of being sold useless stuff, we media-savvy consumers can spot a con job when we see one. We know advertising is a game; our idea of entertainment is watching the cigarette smoke-and-mirrors heyday of Madison Avenue on Mad Men or Trust Me's Sarah Krajicek-Hunter as she comes to terms with shilling for Dove shampoo (which is, in itself, a genius bit of shilling). So when we see Dodge dealerships offering two-for-one deals or Ed McMahon joking about his home foreclosure while flacking for Cash 4 Gold, we're less likely to be swayed than wonder if that's truly the best our sharpest marketing minds can come up with. Still, one feels a twinge of empathy while imagining the flop sweat of the modern-day Don Drapers as they try to figure out how to help their belt-tightening clients keep their belt-tightening customers. And all this at a time when print media seems to be on its deathbed and Internet marketing looks like the Wild West.

In a striking admission of the chaotic new reality, in March the advertising goliath Ogilvy & Mather—which counts Coca-Cola, Ford, Kraft, and IBM among its blue-chip clients—launched a dedicated Recession Marketing Practice. Brochures announcing the new venture ooze confidence, but also give off a slightly ominous vibe; they open with a quote from Charles Darwin ("It is not the strong, nor the intelligent who survive, but those who are quickest to adapt") and prominently feature Ogilvy's fatalistic motto: "We sell—or else." Forget dog eat dog. This is Wild Kingdom meets Glengarry Glen Ross. The timid are about to be culled from the herd.

The key to brand survival, Ogilvy asserts, is for companies to do anything but "go dark"—i.e., fire their ad agency. Conveniently for ad firms, students of recession and depression economics (from Wharton professors to basement-dwelling business bloggers) advise spending as much on ads as possible—to "steer into the skid," rather than slam on the brakes and wind up in the ditch. According to Ogilvy's own stats, companies with enough cojones "to increase marketing spend" will dramatically enlarge their market share during the recession and—just as enticingly—recover an average of three times faster once happy days return. Counterintuitively, product visibility, more than price cuts or gimmicks like BOGOF (buy one get one free), drives consumers' purchases in tough times. Better, in short, to blow your budget on aggressive advertising than to lose money offering discounts.

But the real challenge—the art, even—of recession marketing is perfecting a pitch that doesn't emphasize your hunger for your cash-conscious buyers' cash. Ogilvy recommends using "reassurance messages"—acknowledgments of the current situation, couched in a spirit of we're-in-this-together-ness. A good example is a recent Allstate commercial, in which Dennis Haysbert (known as 24's crisis-plagued first black president) intones over a Ken Burns-style slideshow of Depression-era photographs, "1931 was not exactly a great year to start a business, but that's when Allstate opened its doors." He goes on, "After the fears subside, a funny thing happens: People start enjoying the small things in life—a home-cooked meal, time with loved ones, appreciating the things we do have, the things we can count on. It's back to basics, and the basics are good." What exactly home cooking has to do with car insurance is unclear, but that's the point. Allstate is feeling our pain.

Not that any of this has to be true or even reflect consumers' best interests: Reassurance messages, Ogilvy notes, "don't need to be purely rational, of course. Indeed, there is growing evidence that emotionally based messages are more persuasive than rational ones." Hard to believe companies pay big bucks for news flashes like this.

Ogilvy's already tried to work its magic for Kool-Aid, a Kraft brand that competes with soft drinks—one of the first things it claims recession-spooked consumers stop buying. "For the price of one bottle of soda, you can mix up five big pitchers of Kool-Aid," the ad announces, closing with this feel-good tag: "For pennies a glass, keep the whole family refreshed and smiling!" Seriously? Is that all it takes to keep consumers drinking the Kool-Aid?

Maybe so. Like Ogilvy emphasizes, it's not about intelligence; it's about speed. In March, after a year of heavy losses, Starbucks announced a new line of instant-coffee packets that sold for less than a dollar apiece. Right idea, but way too late: The coffee juggernaut's competitors had been attacking its upscale image for months. Dunkin' Donuts had orchestrated an online "Friends Don't Let Friends Drink Starbucks" viral campaign. McDonald's was even blunter, rolling out a line of specialty coffees with the in-your-face slogan "Four bucks is dumb. Now serving espresso." And just like that, fancy-schmancy coffee had been reclaimed for the masses.

So if a $4 mocha latte is now a ridiculous extravagance, how do aspirational brands advertise their way out of this? The current downturn hit just as Hyundai was completing its transformation from economy to luxury brand, unveiling the $37,000 Genesis 4.6 sedan. It could hardly pitch its new line of Lexus wannabes as a frugal investment, nor could it slash prices. In January, it revealed the ultimate reassurance ploy, the Hyundai Assurance Plan. The premise was simple and eye-catching: Buy one of our cars, and if you lose your job, we'll buy it back.

Once you get into the fine print, of course, the deal isn't as great as it sounds. The offer is only good for the first year of ownership, if you have made several payments already (or made a steep down payment), and if you can prove that you lost your job involuntarily or went bankrupt. Even then, the Assurance Plan only covers up to $7,500 worth of depreciation.

But what's remarkable about the promotion is that Hyundai is betting that most buyers will keep their jobs and any returned cars will retain a significant percentage of their value—two assumptions that echo the gamble that landed us in so much trouble in the housing market. The genius of subprime lending was supposed to be the invincible collateral of a big-ticket item. But when too many buyers default on their payments, that same collateral floods the market and swamps new sales—be that for a house or a car. Still, the pitch worked, at least for a month: Hyundai's January sales jumped 14 percent compared with January 2008, even as the rest of the auto industry's dropped 37 percent. With numbers like those, other companies are bound to mimic the strategy. (JetBlue already has.) Whatever it takes to make the unnecessary seem less unnecessary.

Of course, it's not a bad thing if the recession encourges consumers—and by extension, corporate America—to live more within their means. Just in the past few months, GM has announced that it will eliminate its Hummer brand as part of its restructuring; communities across the country, saddled with the closures of chains like Circuit City and Linens 'n Things, have passed bans on superstores; and sagging sales for the four largest bottled water labels have led their parent companies to cut back on production. Maybe this truly is the dawning of a new market Darwinism. Who will mourn if gas-guzzling SUVs, big-box stores, and mountains of plastic waste go the way of the dodo?

Madison Avenue will, but it will still find a way to repackage our newfound distrust of the big, the slick, and the entitled. Consider a recent Cheetos campaign that never explicitly mentions the economy but plays out like textbook class warfare. In a spot first aired during what some pessimists dubbed the "Dust Bowl Super Bowl," a woman munches Cheetos while she listens to a snooty soccer mom go on about her son's "trilingual immersion program." In the end, the beleaguered woman smears her orange-cheese-tipped fingers all over the back of the snob's white jacket.

Another spot features a guy named Alejandro eating Flaming Hot Cheetos until his eyes water and his nose runs; when his Gordon Gekko-type boss mistakes him for sick and orders him home, Alejandro responds in an ironic monotone, "Okay, I'll do it for the sake of this great American corporation." The message: Your mass-produced corporate junk food hates rich people as much as you do.

Source - Mother Jones

Tuesday, May 19, 2009


Brazil & China Look To Axe The Dollar

Brazil and China will work towards using their own currencies in trade transactions rather than the US dollar, according to Brazil’s central bank and aides to Luiz Inácio Lula da Silva, Brazil’s president.

The move follows recent Chinese challenges to the status of the dollar as the world’s leading international currency.

Mr Lula da Silva, who is visiting Beijing this week, and Hu Jintao, China’s president, first discussed the idea of replacing the dollar with the renminbi and the real as trade currencies when they met at the G20 summit in London last month.

An official at Brazil’s central bank stressed that talks were at an early stage. He also said that what was under discussion was not a currency swap of the kind China recently agreed with Argentina and which the US had agreed with several countries, including Brazil.

“Currency swaps are not necessarily trade related,” the official said. “The funds can be drawn down for any use. What we are talking about now is Brazil paying for Chinese goods with reals and China paying for Brazilian goods with renminbi.”

Henrique Meirelles and Zhou Xiaochuan, governors of the two countries’ central banks, were expected to meet soon to discuss the matter, the official said.

Mr Zhou recently proposed replacing the US dollar as the world’s leading currency with a new international reserve currency, possibly in the form of special drawing rights (SDRs), a unit of account used by the International Monetary Fund.

In an essay posted on the People’s Bank of China’s website, Mr Zhou said the goal would be to create a reserve currency “that is disconnected from individual nations”.

In September, Brazil and Argentina signed an agreement under which importers and exporters in the two countries may make and receive payments in pesos and reals, although they may also continue to use the US dollar if they prefer.

An aide to Mr Lula da Silva on his visit to Beijing said the political will to enact a similar deal with China was clearly present. “Something that would have been unthinkable 10 years ago is a real possibility today,” he said. “Strong currencies like the real and the renminbi are perfectly capable of being used as trade currencies, as is the case between Brazil and Argentina.”

In what was interpreted as a sign of Chinese concern about the future of the dollar, the governor of China’s central bank proposed in March that the US dollar be replaced as the world’s de-facto reserve currency.

In an essay posted on the People’s Bank of China’s website, Zhou Xiaochuan, the central bank’s governor, said the goal would be to create a reserve currency ”that is disconnected from individual nations” and modelled on the International Monetary Fund’s special drawing rights, or SDRs.

Economists have argued that while the SDR plan is unfeasible now, bilateral deals between Beijing and its trading partners could act as pieces in a jigsaw designed to promote wider international use of the ­renminbi.

Any move to make the renminbi more acceptable for international trade, or to help establish it as a regional reserve currency in Asia, could enhance China’s political clout around the world.

Source - Financial Times

Monday, May 18, 2009


Bankrupt Pakistan Intensifies Nuke Development

Members of Congress have been told in confidential briefings that Pakistan is rapidly adding to its nuclear arsenal even while racked by insurgency, raising questions on Capitol Hill about whether billions of dollars in proposed military aid might be diverted to Pakistan’s nuclear program.

Adm. Mike Mullen, the chairman of the Joint Chiefs of Staff, confirmed the assessment of the expanded arsenal in a one-word answer to a question on Thursday in the midst of lengthy Senate testimony. Sitting beside Defense Secretary Robert M. Gates, he was asked whether he had seen evidence of an increase in the size of the Pakistani nuclear arsenal.

“Yes,” he said quickly, adding nothing, clearly cognizant of Pakistan’s sensitivity to any discussion about the country’s nuclear strategy or security.

Inside the Obama administration, some officials say, Pakistan’s drive to spend heavily on new nuclear arms has been a source of growing concern, because the country is producing more nuclear material at a time when Washington is increasingly focused on trying to assure the security of an arsenal of 80 to 100 weapons so that they will never fall into the hands of Islamic insurgents.

The administration’s effort is complicated by the fact that Pakistan is producing an unknown amount of new bomb-grade uranium and, once a series of new reactors is completed, bomb-grade plutonium for a new generation of weapons. President Obama has called for passage of a treaty that would stop all nations from producing more fissile material — the hardest part of making a nuclear weapon — but so far has said nothing in public about Pakistan’s activities.

Bruce Riedel, the Brookings Institution scholar who served as the co-author of Mr. Obama’s review of Afghanistan-Pakistan strategy, reflected the administration’s concern in a recent interview, saying that Pakistan “has more terrorists per square mile than anyplace else on earth, and it has a nuclear weapons program that is growing faster than anyplace else on earth.”

Obama administration officials said that they had communicated to Congress that their intent was to assure that military aid to Pakistan was directed toward counterterrorism and not diverted. But Admiral Mullen’s public confirmation that the arsenal is increasing — a view widely held in both classified and unclassified analyses — seems certain to aggravate Congress’s discomfort.

Whether that discomfort might result in a delay or reduction in aid to Pakistan is still unclear.

The Congressional briefings have taken place in recent weeks as Pakistan has descended into further chaos and as Congress has considered proposals to spend $3 billion over the next five years to train and equip Pakistan’s military for counterinsurgency warfare. That aid would come on top of $7.5 billion in civilian assistance.

None of the proposed military assistance is directed at the nuclear program. So far, America’s aid to Pakistan’s nuclear infrastructure has been limited to a $100 million classified program to help Pakistan secure its weapons and materials from seizure by Al Qaeda, the Taliban or “insiders” with insurgent loyalties.

But the billions in new proposed American aid, officials acknowledge, could free other money for Pakistan’s nuclear infrastructure, at a time when Pakistani officials have expressed concern that their nuclear program is facing a budget crunch for the first time, worsened by the global economic downturn. The program employs tens of thousands of Pakistanis, including about 2,000 believed to possess “critical knowledge” about how to produce a weapon.

The dimensions of the Pakistani buildup are not fully understood. “We see them scaling up their centrifuge facilities,” said David Albright, the president of the Institute for Science and International Security, which has been monitoring Pakistan’s continued efforts to buy materials on the black market, and analyzing satellite photographs of two new plutonium reactors less than 100 miles from where Pakistani forces are currently fighting the Taliban.

“The Bush administration turned a blind eye to how this is being ramped up,” he said. “And of course, with enough pressure, all this could be preventable.”

As a matter of diplomacy, however, the buildup presents Mr. Obama with a potential conflict between two national security priorities, some aides concede. One is to win passage of a global agreement to stop the production of fissile material — the uranium or plutonium used to produce weapons. Pakistan has never agreed to any limits and is one of three countries, along with India and Israel, that never signed the Nuclear Nonproliferation Treaty.

Yet the other imperative is a huge infusion of financial assistance into Afghanistan and Pakistan, money considered crucial to helping stabilize governments with tenuous holds on power in the face of terrorist and insurgent violence.

Senior members of Congress were already pressing for assurances from Pakistan that the American military assistance would be used to fight the insurgency, and not be siphoned off for more conventional military programs to counter Pakistan’s historic adversary, India. Official confirmation that Pakistan has accelerated expansion of its nuclear program only added to the consternation of those in Congress who were already voicing serious concern about the security of those warheads.

During a hearing of the Senate Armed Services Committee on Thursday, Senator Jim Webb, a Virginia Democrat, veered from the budget proposal under debate to ask Admiral Mullen about public reports “that Pakistan is, at the moment, increasing its nuclear program — that it may be actually adding on to weapons systems and warheads. Do you have any evidence of that?”

It was then that Admiral Mullen responded with his one-word confirmation. Mr. Webb said Pakistan’s decision was a matter of “enormous concern,” and he added, “Do we have any type of control factors that would be built in, in terms of where future American money would be going, as it addresses what I just asked about?”

Similar concerns about seeking guarantees that American military assistance to Pakistan would be focused on battling insurgents also were expressed by Senator Carl Levin of Michigan, the committee chairman.

“Unless Pakistan’s leaders commit, in deeds and words, their country’s armed forces and security personnel to eliminating the threat from militant extremists, and unless they make it clear that they are doing so, for the sake of their own future, then no amount of assistance will be effective,” Mr. Levin said.

A spokesman for the Pakistani government contacted Friday declined to comment on whether his nation was expanding its nuclear weapons program, but said the government was “maintaining the minimum, credible deterrence capability.” He warned against linking American financial assistance to Pakistan’s actions on its weapons program.

“Conditions or sanctions on this issue did not work in the past, and this will not send a positive message to the people of Pakistan,” said the official, who spoke on condition of anonymity because his country’s nuclear program is classified.

Source - New York Times

Saturday, May 16, 2009


Dire Eire

Lounging amid the bruised plastic furniture and polyester carpeting at his dilapidated offices at Dublin Airport, Michael O'Leary, CEO of Ryanair, is ebullient about his low-cost carrier's prospects: "We'll mop the floor with every airline in Europe!"

He's also, on this chilly spring evening, a blarney-filled promoter of his airline's flashy image, pointing to the bikini-clad beauties in his Girls of Ryanair calendar and boasting that they "really do work here!"

But O'Leary, like many other Irish business leaders, is optimistic about his own business yet worried about the future of the Celtic miracle that created the likes of Ryanair and sprinkled Eire's ancestral pastures with biotech plants and software labs.

That's because the global economic tempest has washed over Ireland, and its economy is suffering the deepest plunge of virtually any country outside of Iceland. (See "Iceland: The Country That Became a Hedge Fund") It has been hit by a sudden, shocking reversal of fortune that even a Gaelic weaver of tales would find difficult to invent. The economy of the European Union's fastest-growing major member country since the euro made its debut 10 years ago has ground to a halt. The Irish government predicts that GDP will tumble 7.7% this year, after sliding 2.2% in 2008. Unemployment is forecast to hit 15% next year, quadrupling the figure in 2007.

So far, the government's response is to borrow its way out of trouble. Public spending jumped an astronomical 63% from 2003 to 2008. Now a weak economy is decimating tax receipts, leaving the government this year with a projected 11% budget deficit, the worst fiscal shortfall in Western Europe.

The risk is that Ireland will lose control of its destiny. Some believe that if the government doesn't soon begin to cut costs, it may not be able to borrow enough to meet its needs and then will have to be rescued by its European neighbors. This could destroy Ireland's allure for foreign investors such as Intel (INTC, Fortune 500), HP (HPQ, Fortune 500), Microsoft (MSFT, Fortune 500), and Pfizer (PFE, Fortune 500) that helped make it a shooting star for almost two decades.

"An international bailout will wreck our competitiveness," says the blue-jean-clad O'Leary, sipping vending machine espresso bought with a euro bummed from a flight attendant. "For a company the only reliable way to restore profits is to lower costs. The government needs to get off its backside and radically cut spending."

As its troubles mount, Ireland also stands in danger of losing a rare gift: its image as a beacon for talent - and as the EU's leading land of opportunity. Chefs from France, construction workers from Poland, and accountants from the Czech Republic are heading home. In 2007, 67,000 more people arrived than departed. This year 30,000 more workers are expected to leave than arrive, reversing 14 years of strong immigration and raising fears that the curse of the '70s and '80s - the steady exodus of the best workers - is again exerting its grip.

Ireland's main problem, however, isn't its fundamental economy, which still packs vast potential for exports and could rebound strongly as global growth resumes. The challenge is to rein in a soaring budget deficit, a legacy of years of profligate spending that was fueled by a tax windfall from the biggest real estate bubble in Europe. When that bubble collapsed early last year, so did the revenue the government swore would last forever.

Now the nation's leaders are busily raising taxes to close the chasm, while maintaining high levels of spending. Prime Minister Brian Cowen's centrist administration promises to tame its bloated budget in future years. However, if the tax increases don't reap substantial extra revenue or if the government retreats on its pledge to reduce expenditures (both are possible), Ireland will face a dilemma: either raise taxes to ruinous levels or accept an EU bailout that would force the country to engage in fiscal discipline. Either way, Ireland would have to surrender the low-tax advantages that have drawn foreign investors and made Ireland the Tiger of Europe. Excessive tax increases would also exacerbate the brain drain, as the skilled workers who flocked here from the world's best labs and universities depart for rival countries.

To be sure, a prosperous outcome, a thriving "Celtic Tiger, the Sequel," is also possible, and some early signs suggest that Ireland may be getting back on track. The miserable economy is giving the country the shock it needs to restore its competitiveness as exporters slash wages, and the once-exorbitant cost of everything from houses to labor plunges. Even the naysaying O'Leary predicts that if the government embraces something resembling austerity, "We'll go down harder and deeper than other countries and rise up faster and better."


How did Ireland get into this mess? The short answer is that the advantage that gave Ireland its roar - its tremendous strength as an exporter - has waned. After growing 15% a year in the late 1990s and early 2000s, exports rose just 6% annually during the past six years. This year they'll decline - not surprising, given the worldwide recession.

Over this period the composition of Ireland's exports changed dramatically. In the 1990s, Ireland starred as a low-cost manufacturer, turning out electrical equipment, auto components, and plastic moldings. It also gained a foothold in pharmaceuticals - half a dozen of the world's bestselling drugs are made in Ireland, including Viagra and Lipitor by Pfizer and Botox by Allergan.

But Ireland lost routine manufacturing businesses and jobs at a rapid rate to low-cost competitors, especially China and Eastern Europe. Apple (AAPL, Fortune 500) moved its production of circuit boards to Indonesia and of laptops to Taiwan, and Dell (DELL, Fortune 500) is moving its computer-manufacturing operations to Poland from Limerick.

Why the exodus? From 2003 to 2006, Ireland's costs vs. those of the U.S., Britain, and other trading partners outside the eurozone increased by 30%. A rise in the value of the euro against sterling and the dollar accounted for two-thirds of that increase. But Ireland's exports also lost ground to products from its European neighbors because its wages, rents, and energy prices rose far faster than those in Germany, France, or Britain. A main reason was the fierce competition for workers caused by the government's hiring binge and the rapid growth in domestic-service industries, such as banking and advertising, that have been stoked by the overheated economy.

"We had to bid for people who could become teachers and health-care workers with the best pensions in Europe and total job security," says William Slattery, chief of U.S.-owned bank State Street in Ireland.

In place of exports, a new force kept the economy growing and masked the sharp decline in Ireland's competitiveness: an epic building boom that dwarfed even those in the U.S. and the rest of Europe. The construction bubble had two main sources. First, homebuyers gorged on cheap money. Although Ireland's inflation far exceeded that of its European neighbors from 2003 to 2008, its mortgage rates remained extremely low, at 4% to 5%. That's because the European Central Bank sets a blanket rate for lending to banks for all its 16 members. Hence, Ireland could borrow at the same cost as Germany or the Netherlands, even as its prices increased far faster - while the building explosion itself fed more price increases.

"If we'd had an independent monetary policy, interest rates would have been higher, dampening the building boom," says John Hurley, the governor of the Central Bank of Ireland, who emphasizes that the nation gains far more from being part of the powerful euro trading block than it loses in monetary flexibility.

Source - CNN

Tuesday, May 12, 2009


Cook From Scratch

What is it that stands between you and vibrant health? People who have spent a fortune on supplements, gotten plenty of exercise and bought high quality food still find themselves unable to answer this question. For many of them, the answer lies in neurotoxins hidden in even the most healthy sounding foods, including many foods labeled as organic. These ingredients often cause serious reactions, including migraines, insomnia, asthma, depression, anxiety, aggression, chronic fatigue, and even ALS. They may be responsible for the swelling numbers of children diagnosed as ADHD.

Almost everything in every kind of grocery store has additives that can cause reactions including asthma attacks, obesity, tinnitus, and restless leg syndrome. While 1 out of every 4 people is sensitive to neurotoxic food additives, only 1 in 250 is aware that these additives are the source of the reactions they are having.

Most neurotoxic food additives contain free glutamic acids processed from proteins. Monosodium glutamate (MSG) is probably the best known of the neurotoxins. However, there are many other names for these protein derived additives, including yeast extract, maltodextrin, carrageenan, hydrolyzed vegetable protein, dough conditioners, seasonings, spices, and whey protein concentrate. Even the pleasant sounding term natural flavors can mean the presence of additives toxic to the brain and nervous system.

Food additives are there to trick you into thinking what you are consuming tastes really great. They are an assault on your nerve synapses and a violent attack on the cells of your brain.

"Bet you can't eat just one"

Remember that old slogan? Food and beverage companies use food additives because they make you crave more of what tastes so good. They cause nerve cells to cry out for repeated stimulation, keep you buying and consuming more of their products. People watch in horror as they pile on pounds and become food junkies without any idea of how they are being manipulated to further corporate interests. In addition to the benign sounding terms natural flavors and spices, manufacturers use other seemingly innocuous names for these additives on their labels, such as seasonings, broth, or gelatin.

Restaurants are another place to find foods laced with neurotoxins. This is why restaurant food tastes so good. Neurotoxins have conditioned people to think restaurant food tastes so great they will stand in line to get a table, when what they are really paying money for is the privilege of having their brain cells destroyed.

Many people think if they avoid Chinese restaurants they can avoid neurotoxins in their food. But these hazardous chemicals are added to virtually all restaurant food from McDonalds to the most exclusive gourmet dining spots. A sign on the widow or on the package that says there is no MSG, simply means that another form of neurotoxin is used instead.

The FDA wouldn't allow dangerous food additives, would they?

Unfortunately, the food industry is controlled by powerful conglomerates that have great political influence over the FDA and other government regulatory agencies. Naturally it is in the best interests of these corporations to defend their use of the neurotoxic additives that make their products so pleasing to the senses and so habit forming. Just like the tobacco industry, food corporations have no regard for the health of their customers but will stop at nothing to get their money. Until consumers realize what is being done to them and how they are being used, neurotoxins are here to stay. Kicking the addiction promoted by food additives is as difficult as kicking the nicotine habit.

Although the science of food technology has been around since the 1950s, consumers are just now waking up to the link between neurotoxic additives and their loss of vitality. Even when people understand the link intellectually, many are so hooked on the fabulous taste of adulterated food that they just can't stop eating, no matter what it is doing to them. Others buy into the lame propaganda telling them that neurotoxic additives are safe.

Additives from natural sources can be highly toxic

MSG is natural. It is a sodium salt of glutamic acid, an amino acid. Originally isolated from seaweed, MSG is now made by fermenting corn, potatoes and rice. MSG is naturally present in high levels in tomatoes and Parmesan cheese. But MSG is highly dangerous to health. An early study reported that the inner layer of the retina was destroyed in neonatal rats receiving a single exposure to MSG. This is an amazing finding considering that humans are more than 5 times more sensitive to MSG than rats.

Another study used rats to determine the effects of exposure to MSG on obesity. Rats given MSG developed obesity, type II diabetes, and metabolic syndrome X. They also developed lesions of the ventromedial hypothalamic nucleus. MSG is a powerful disrupter of the endocrine system, creating havoc with meta-thermoregularory modulates like neuropeptide Y and leptin, and their target tissue, brown fat. It reduces the thermogenicity of brown fat while also suppressing food intake. This means that MSG makes a people gain weight even when they decrease caloric intake.

These findings explain how a person can hardly eat at all while still putting on weight. But these effects are not confined to MSG. The other substances classified as neurotoxic food additives produce much the same outcomes.

Natural flavors are isolates from naturally occurring products just like MSG. Many natural products including organic fruits and vegetables contain compounds that in isolation are extremely harmful. Some of these compounds are what make up the defense system of the plants. When the whole plant, fruit or vegetable is consumed as food, other compounds are present that neutralize their harmful effects. When taken from the plant as isolates, the compounds become no different in their effects than those created in a laboratory.

The word spice is another innocuous sounding germ, but in the world of food marketing, it is a word that has been manipulated to sound harmless when it really isn't. People tend to think that the individual spices are not listed because the creator of the product doesn't want to give away his secrets. This is not true. When the word "spices" is used, it is the tip off that toxic additives are hidden in the product.

Feeling your best involves learning to read labels

Neurotoxins are added to virtually every packaged food and beverage sold in almost every store. Not just packaged meal type items, but many of the ingredients used to create a meal.

Anyone wanting to avoid neurotoxic additives needs to know that there is a lot more to it than just looking for MSG on the label. MSG may be the most well known of the additives, but all the others are just as hazardous to health and as likely to produce a reaction. Even if products say "No MSG" or call themselves "all natural" or "organic", it is almost a certainty that neurotoxic additives are in that product. There is no way to know unless you are willing to take the time to read the label.

When there are a hundred different kinds of neurotoxic food additives used being pumped into almost everything on stores shelves, trying to avoid them may seem like navigating a mine field. It helps if you are armed with a listing of what to avoid. The label of any product that is canned, frozen, bagged, bottled, boxed, wrapped, put in a carton, or offered in a take home dish or container needs to be examined because almost all of them contain neurotoxins. Check everything you suspect may have flavoring added to it, even coffee, tea bags, and bottled waters. You will be surprised. Be sure to check chewing gum and candy.

It may seem overwhelming at first to have to drag around a list of toxic food additives and examine every product you buy. But very quickly you will learn where to find the ingredient lists and what to look for. The key words will jump off the label right into your eye. As you become better at identifying products using these additives, you will also begin to notice how much better you feel. Those persistent symptoms that have been around for months or years will begin to disappear along with the unwanted pounds. By the time label reading becomes second nature and can be done in one quick glance, you will well be on the road to vibrant health.

Here is a list of what to look for. Arm yourself against corporate exploitation when you go to the store, and learn how to spend your money so that it benefits you, rather than someone else who has made it clear he doesn't care whether you are healthy or not.

Neurotoxic Chemical Food Additives

autolyzed anything
barley malt
beef base
beef flavoring
beef stock
broth of any kind
calcium caseinate
chicken base
chicken broth
chicken flavoring
chicken stock
disodium anything
dough conditioner
gelatinized anything
gaur gum
hydrolyzed anything
kombu extract
malt anything
malted anything
milk solids
monosodium glutamate
natural flavor
pork base
pork flavoring
protein concentrate
protein extract
seasoned salt
smoke flavoring
sodium caseinate
solids of any kind
soup base
soy extract
soy protein anything
soy sauce
textured protein
textured vegetable protein
vegetable gum
whey anything
yeast extract

Source - Natural News

Monday, May 11, 2009


Pernicious Pharma

A fascinating court case in Australia has been playing out around some people who had heart attacks after taking the Merck drug ­Vioxx. This medication turned out to increase the risk of heart attacks in people taking it, although that finding was arguably buried in their research, and Merck has paid out more than £2bn to 44,000 people in America – however, they deny any fault.

British users of the drug have had their application for legal aid rejected, incidentally: the health minister, Ivan Lewis, promised to help them, but documents obtained by the Guardian last week showed that within hours Merck launched an expensive lobbying effort that convinced the minister to back off.

This is a shame, because court cases can be tremendously revealing.

The first fun thing to emerge in the Australian case is email documentation showing staff at Merck made a "hit list" of doctors who were critical of the company, or of the drug. This list contained words such as "neutralise", "neutralised" and "discredit" next to the names of various doctors.

"We may need to seek them out and destroy them where they live," said one email, from a Merck employee. Staff are also alleged to have used other tactics, such as trying to interfere with academic appointments, and dropping hints about how funding to institutions might dry up. Institutions might think about whether they wish to receive money from a company like that in future. Worse still, is the revelation that Merck paid the publisher Elsevier to produce a publication.

The relationship between big pharma and publishers is perilous. Any industry with global revenues of $600bn can afford to buy quite a lot of adverts, and pharmaceutical companies also buy glossy expensive "reprints" of the trials it feels flattered by. As we noted in this column two months ago, there is evidence that all this money distorts editorial decisions.

This time Elsevier Australia went the whole hog, giving Merck an entire publication which resembled an academic journal, although in fact it only contained reprinted articles, or summaries, of other articles. In issue 2, for example, nine of the 29 articles concerned Vioxx, and a dozen of the remainder were about another Merck drug, Fosamax. All of these articles presented positive conclusions. Some were bizarre: such as a review article containing just two references.

In a statement to The Scientist magazine, Elsevier at first said the company "does not today consider a compilation of reprinted articles a 'journal'". I would like to expand on this ­statement: It was a collection of academic journal articles, published by the academic journal publisher Elsevier, in an academic ­journal-shaped package. Perhaps if it wasn't an academic journal they could have made this clearer in the title which, I should have mentioned, was named: The Australasian Journal of Bone and Joint Medicine.

Things have deteriorated since. It turns out that Elsevier put out six such journals, sponsored by industry. The Elsevier chief executive, Michael Hansen, has now admitted that they were made to look like journals, and lacked proper disclosure. "This was an unacceptable practice and we regret that it took place," he said.

The pharmaceutical industry, and publishers, as we have repeatedly seen, have serious difficulties in living up to the high standards needed in this field, and bad information in the medical literature leads doctors to make irrational prescribing decisions, which ultimately can cost lives, and cause unnecessary suffering, not to mention the expense.

It has been estimated it would take 700 hours a month to read the thousands of academic articles relevant to a GP; doctors skim, they take shortcuts, they rely on summaries, or worse. We could perform better when giving them information, but for now, it will often be "actually, I think I've seen at least two studies on that, and in different journals".

The real tragedy is that the cost of distorted information, and irrational prescribing, is far greater than the cost of the research that could prevent it. Health systems pay for these drugs – state-funded in almost every single developed country – and they largely pay for the journals, too. In a sensible world, countries would band together and pay for comparative research themselves, and the free, open distribution of the results, to prevent all this nonsense.

We do not live in a sensible world.

Source - Guardian


Western Imperialism - Thriving But Covert

Some facts:

In 1960, 20% of the world’s people in the richest countries had 30 times the income of the poorest 20% — in 1997, 74 times as much.

An analysis of long-term trends shows the distance between the richest and poorest countries was about:

* 3 to 1 in 1820
* 11 to 1 in 1913
* 35 to 1 in 1950
* 44 to 1 in 1973
* 72 to 1 in 1992

For every $1 in aid a developing country receives, over $25 is spent on debt repayment.

The poorer the country, the more likely it is that debt repayments are being extracted directly from people who neither contracted the loans nor received any of the money.

For economic growth and almost all of the other indicators, the last 20 years [of the current form of globalization, from 1980 - 2000] have shown a very clear decline in progress as compared with the previous two decades [1960 - 1980]. For each indicator, countries were divided into five roughly equal groups, according to what level the countries had achieved by the start of the period (1960 or 1980). Among the findings:

* Growth: The fall in economic growth rates was most pronounced and across the board for all groups or countries.
* Life Expectancy: Progress in life expectancy was also reduced for 4 out of the 5 groups of countries, with the exception of the highest group (life expectancy 69-76 years).
* Infant and Child Mortality: Progress in reducing infant mortality was also considerably slower during the period of globalization (1980-1998) than over the previous two decades.
* Education and literacy: Progress in education also slowed during the period of globalization.

The total wealth of the top 8.3 million people around the world “rose 8.2 percent to $30.8 trillion in 2004, giving them control of nearly a quarter of the world’s financial assets.” In other words, about 0.13% of the world’s population controlled 25% of the world’s financial assets in 2004.

The world’s low income countries (2.4 billion people) account for just 2.4% of world exports.

World gross domestic product (world population approximately 6.5 billion) in 2006 was $48.2 trillion in 2006.

* The world’s wealthiest countries (approximately 1 billion people) accounted for $36.6 trillion dollars (76%).
* The world’s billionaires — just 497 people (approximately 0.000008% of the world’s population) — were worth $3.5 trillion (over 7% of world GDP).
* Low income countries (2.4 billion people) accounted for just $1.6 trillion of GDP (3.3%)
* Middle income countries (3 billion people) made up the rest of GDP at just over $10 trillion (20.7%).

The GDP (Gross Domestic Product) of the 41 Heavily Indebted Poor Countries (567 million people) is less than the wealth of the world’s 7 richest people combined.

In 2005, the wealthiest 20% of the world accounted for 76.6% of total private consumption. The poorest fifth just 1.5%.

The poorest 10% accounted for just 0.5% and the wealthiest 10% accounted for 59% of all the consumption.

Less than one per cent of what the world spent every year on weapons was needed to put every child into school by the year 2000 and yet it didn’t happen.

According to UNICEF, 25,000 children die each day due to poverty.

Almost half the world — over three billion people — live on less than $2.50 a day.

At least 80% of humanity lives on less than $10 a day.

More than 80 percent of the world’s population lives in countries where income differentials are widening.

Source - Global Issues

Friday, May 08, 2009

Fast Forward

2012 - A Possible American Future

Since the economy began sliding downhill in late 2007, mainstream economic and market experts have consistently erred on the sunny side.

As late as June 2008, mainstream consensus held that the U.S. was heading for a “soft landing” and would avoid recession. Several months later, the slump was acknowledged to have started in January 2008, but we were supposed to see renewed growth by mid-2009, with unemployment peaking in the eight-to-nine percent range. A quick “shovel-ready” stimulus bag was supposed to set us back on the road to prosperity.

In January, recovery projections were pushed forward to late 2009. Today, the consensus is for a mid-2010 recovery, with unemployment peaking at just over 10 percent. Clearly, the mainstream has struggled to catch up to reality for well over one year. What are the chances that they finally have it right this time?

Moreover, the mainstream continues to see what is going on as a plain-vanilla recession that will be quelled with some on-the-fly monetary and fiscal tinkering. Washington, we are told, will pull us out of this slump—as soon as the masses can be enticed back to the shopping malls. Then things will return to how they were before. But what if the experts and politicians are wrong not only on their ever-changing recovery timeline, but also on the nature—nay, the very existence—of a recovery?

America’s reigning political-economic ideology has demonstrably failed. Given that its government is obviously fumbling along without a clue, its foreign and domestic credit is tapped out, and its 300 million people are discovering that their hopes for continuous material improvement will never be met, could the U.S. be headed the way of the USSR?

Instead of a recovery as the mainstream envisions it, what if America permanently bankrupts, impoverishes, and marginalizes itself? What if its cherished institutions fail across the board? For example, what happens when the police realize that their under-funded pension plans cannot support a decent retirement? Will they stay honest, or will they opt to survive by any means necessary? These are questions that the mainstream does not even begin to contemplate.

In the interests of providing you with an alternate vision—something outside the mainstream—below are ten predictions for America through the year 2012. This is not boilerplate doom-saying. Rather, I am laying out in highly specific terms what will happen over the next three-odd years. Others have thrown around the term “Depression”, but I am going to tell you precisely what it means for you, your investments, and your community.

When these predictions come true, I expect to be rewarded with a seven-figure consulting gig, a book contract, or a high-level position in whatever administration succeeds the doomed Obama team—that is, if anyone succeeds it at all.

Prediction one. The twenty-five-year equities bubble pops in 2009. U.S. and foreign equities markets will stop treading water and realign with economic reality. Stock prices will cease to reflect the “greater fool” mentality and will return to being a function of dividend yields, which have long been miserable. The S&P 500 will sink below 500. In a bid to stem the panic, the government will enforce periodic “stock market holidays”, and will vastly expand the scope of its short-selling prohibitions—eventually banning short-selling altogether.

Prediction two. With public pension systems and tens of millions of 401k holders virtually wiped out—and with the Baby Boomers retiring en masse—there will be tremendous pressure on the government to get into the stock market in order to bid up prices.

Therefore, sometime in 2010, the Federal Reserve will create and loan out hundreds of billions of fresh dollars to the usual well-connected suspects, instructing them to buy up stocks on the public’s behalf. This scheme will have a fancy but meaningless name—something like the “Taxpayer Assurance Equities Facility”. It will have no effect other than to serve as buyer of last resort for capitulating smart-money types who want to get out of stocks entirely.

Prediction three. Millions of new retirees—including white-collar people with high expectations for a Golden Retirement—will be left virtually penniless. Thousands will starve or freeze to death in their own homes. Hundreds of thousands will find themselves evicted and homeless, or will have to move in with their less-than-enthusiastic children. Already strained by the rising tide of the working-age unemployed, state and local welfare services will be overwhelmed, and by 2012 will have largely collapsed and ceased to function in many parts of the country.

Prediction four. “Quantitative easing” will fail to restart previous patterns of lending and consumption. As the government sends out additional “rebate” checks and takes ever-more drastic measures to force banks to lend, hyperinflation could take hold. However, comprehensive debt relief via a devaluation of the dollar is even more likely. This would entail the government issuing one “new” dollar for some greater number of “old” dollars—thus reducing both debts and savings simultaneously. This would make for a clean slate a la Fight Club.

As there are many more debtors than savers in the U.S., the vast majority would support devaluation. The Chinese and other foreign holders of our bonds would be screaming mad, but unable to do anything. Every country that has not found a way out of dollar-denominated reserve assets by 2012 will see its reserves eliminated.

Prediction five. The government will stop pretending that it can finance continuous multi-trillion-dollar deficits on the private market. By late 2010, the sole buyers of new U.S. Treasury and agency bonds will be the Federal Reserve and a few derelict financial institutions under government control. This may or may not lead to hyperinflation. (See prediction four).

Prediction six. As the need for financial industry paper-pushers declines and people have less money to spend on lawyers and Starbucks (SBUX), unemployment will rise until the private sector has eliminated all of its excess capacity and superfluous or socially needless jobs. The government’s narrow unemployment figure (U3) will rise into the high teens by late 2010. The government’s broader unemployment figure (U6) will cease to be reported when it reaches 25 percent—it will simply be too embarrassing. Ultimately, one in three work-eligible Americans will be unemployed, underemployed, or never-employed (e.g. college grads permanently unable to find suitable work).

Prediction seven. With their pension dreams squashed, and their salaries frozen or cut, police and other local government workers will turn to wholesale corruption in order to survive. America’s ideal of honest, courteous, and impartial cops, teachers, and small-time local functionaries will have come to an end.

Prediction eight. Commercial overcapacity will strike with a vengeance. By 2012, thousands of enclosed malls, strip malls, unfinished residential developments, motels, truck stops, distribution centers, middle-of-nowhere resorts and casinos, and small-city airports across America will turn into dilapidated, unwanted, and dangerous ghost towns. With no economic incentive for their maintenance or repair, they will crumble into overgrown, plywood-and-sheet-rock ruins.

Prediction nine. By the end of 2010, tens of millions of households will have fallen behind on their mortgages or stopped paying altogether. Many banks will be unable to process the massive volume of foreclosure paperwork, much less actually seize and resell the homes.

Devaluation (as mentioned in prediction four) could ease the situation for those mortgage holders still afloat, but it would also eliminate any incentive for most banks to stay in the mortgage business. In any case, the housing market in many parts of the country will lock up completely—nothing bought or sold.

With virtually no loans being made, even the government will finally acknowledge that most banks are fundamentally insolvent. A general bank run will only be averted through a roughly one trillion-dollar recapitalization of the FDIC, courtesy of new money from the Federal Reserve.

Prediction ten. As an economy is never independent of the society within which it functions, the next few paragraphs will focus on social and political factors. These factors will have as much of an impact on market and consumer confidence as any developments in the financial sector.

Whether rightly or not, President Obama, having come to power at the dawn of this crisis, will be blamed for it by over 50 percent of the population. He will be a one-term president. In response to his perceived socialization of America, there will be a swarm of secessionist and extremist activity, much of it violent. Militias and armed sects will be more prominent than in the early 1990s. Stand-off dramas, violent score-settlings, and going-out-with-a-bang attacks by laid-off workers and bankrupted investors—already a national plague—will become an everyday occurrence.

For both economic and social reasons, millions of immigrants and guest workers will return to their home countries, taking their assets and skills with them. The flow of skilled immigrants will slow to a trickle. Birth rates will plummet as families struggle with uncertainty and reduced (or no) income.

Property crime will explode as citizens bitter over their own shattered dreams attempt to comfort themselves by taking what is not theirs. Mutinies and desertions will proliferate in an increasingly demoralized, over-stretched military, especially when states can no longer provide the educational and other benefits promised to their National Guard troops.

There will be widespread tax collection issues, and a huge backlash against Federal and state bureaucrats who demand three-percent annual pay raises while private sector wages remain frozen or worse. In short, the “Tea Parties” of tomorrow will likely not be so restrained.

Finally, between now and 2012, we are likely to see another earth-shaking national embarrassment on the scale of the 9/11 attacks or Hurricane Katrina and its aftermath. This will demonstrate conclusively to all Americans that their government, even under a savior-figure like Obama, cannot, in fact, save them.

By 2012, there will be a general feeling that the nation is in immediate danger of blowing up or coming apart at the seams. This fear will be justified, given that the U.S. has always been held together by the promise of a continuously rising material standard of living—the famous “pursuit of happiness”—rather than any ethnic or religious ties. If that goes, so could everything else. We were lucky in the 1930s—we may not be so lucky again.

Source - Seeking Alpha


American Men

As someone who spends a fair amount of time in airports, I marvel at the way my fellow citizens present themselves in public. I see middle-aged women who appear to have left home in their pajamas. But it's the costume and demeanor of American young men especially that raises interesting questions about who we have become.

The fashion and body language of male youth in 2007 comes from three sources: prison, the nursery, and the pimpmobile. It's an old story now that many conventions of gangster fashion come out of the jail experience, where they take away your belt and shoelaces so you won't hang yourself. Apparently, at some point in US history, they stopped giving the belts and shoelaces back on release, and it became stylish to wear your trousers falling down below the top of your underpants (or butt crack as the case may be). Jail being a kind of accreditation device these days, the message may be: I passed the entrance exam.

Less obvious is the contribution of the nursery. Pants that are ambiguously neither long or short, worn with XX-large T shirts, tend to make grown men look like babies. Babies have short legs and large torsos compared to grown men. They also make big awkward gestures and touch their sex organs a lot. Add a sideways hat and unlaced sneakers and you have the complete kindergarten rig. Why a 20-year-old male would want to look five years old is another interesting question, but it may have a lot to do with the developmental failures of boys raised in households without fathers. They simply don't know how to be men. They only know how to behave like five year old boys. They even give themselves nursery school nicknames. But they are men, and what could be more menacing than the paradox of a child bent on homicide.

Tattoos used to be pretty much the sole fashion statement of merchant seamen or people who have served in the armed forces (or people who live in jungles). Now they are common among career girls. The tattooed guys I see down at the gym are ordinary young men who work in cubicles. Tattoos on sailors used to celebrate places they had been or people they had loved. The tattoos I see now are meant to convey fierce and barbaric statements of superhuman power: look at me, I'm a Power Ranger! It's understandable that someone who spends most of his waking hours in a cubicle wearing a telephone headset in order to swindle old people out of their savings might fantasize about rising above all that. But the tragic thing, of course, is that getting tattooed is not quite the same as accomplishing something with your life. In the end, you're just another loser with a grandiose and ridiculous tattoo.

The pimp connection is too obvious to belabor -- meant to mock normal executive attire while signifying an existence of total leisure and the enjoyment of unearned riches. The trouble is that the worship of unearned riches -- based on the belief that it truly is possible to get something for nothing -- has now become normal at all levels in American life. Everybody from the lowest whoremonger on Hollywood Boulevard to the Wall Street hedge fund managers believes in unearned riches plucked from "suckers." The catch is that men who live by this code almost always come to a bad end. They get their throats cut with razors, or go to prison, or manage to lose all their unearned riches (and the investments of many strangers, too).

The portrait of the young American male in 2007, therefore, is of an impotent, infantalized being lost in grandiose fantasies of power and importance. It's a picture of men without real confidence, and no idea how to achieve it, who wish to project a transcendently ferocious image complete with odds-and-ends of manner taken from comic books and movies based on comic books, in order to be taken seriously.

The rest of the world must tremble to contemplate the picture we present. The Nazi soldiers of 1944 were glamour boys compared to the riff-raff that American young men have become. As for those who actually do make it into the army, you wonder how they appear to the locals overseas -- they're probably taken seriously as exactly what the present themselves to be: manifestly evil beings who really need to be blown up. Back home, I look around at the thugs and sluggos at my gym, and I'm ashamed to be a citizen of the same country they live in.

Source - James Howard Kunstler