Starbucking with Consultants

You too? Tired? Let's wander away from politics, and from Wall Street (All Praise to Dimon) and grab a metaphysical cup of coffee. Mmmm! Let's also grab today's USA Today. Hold on to it, because we will be rolling in it in just a minute to beat some people with it.

I've never had coffee from Starbucks. I am not huge on coffee to begin with. I do manage to pass the store each day when stopping at the local strip mall after work. In fact there are two Starbucks. There is the store itself, and then there is the kiosk inside the front of the Safeway supermarket.

Each day when I arrive at around seven or so, often to buy blueberry muffins or deli turkey, I always take a quick glance to see who might be sitting there actually sipping a coffee in the small little seating area that is most definately not the ideal spot to kick back.

After all, people are walking in and out, whizzing left and right, with carts in tow. The beefy security man is strolling about too, oblivious to personal space. The only people you really see seated trying to recapture the Starbucks experience (if not Paris) in a supermarket seem to be goofy nerdy looking men with baby pot bellies. That there is actually a real Starbucks 40 yards away lets you know they are in the supermark more to oggle the attractive women coming in from work than to enjoy a peaceful beverage.

Today I looked down my nose at them as I walked by, mildly miffed that the Wall Street Journal was gone. I picked up a USA Today. After all, a paper is a paper, and I had every confidence that USA Today could help explain the complicated shenanigans (and so close to Patty's Day) that resulted in the whole world of Bear Stearns being held in the god-like hands of J.P. Morgan's Jamie Dimon by Sabbath.

After picking up some cranberry juice and muffins, and trying to decide on whether to buy a $10 bag of shrimp, I arrived home, kicked off my shoes, ran a bath, and grabbed the paper. Right there, page 3B was Jamie himself, humbly refusing to be deified. But that's not what got my glaring.

It was the lead article in the Money section that annoyed. It profiled Howard Schultz' return to Starbucks, and his hope to bring unground beans of healing to stores everywhere. I am not a total cynic, and I can appreciate when leaders are willing to do something different--whether tackling a stumbling bear or going back to in-store bean grinding--in order to restart, expand or capture business.

What made the article near useless was the inclusion of suggestions from several consultants, who offered a few light as air soundbites. One in particular managed to wander into my mental forest of darkness, where one ought not to wander unarmed with deep thought.

I will quote the words of one Christopher Muller, who is the director of the Center for Multi-Unit Restaurant Management at Orlando's University of Central Florida (a university that has, in fact, created many of the greatest business minds in imaginary villages everywhere).

Says Chris:

"E-mail is out, Facebook is in.... Starbucks should take a page from Apple and move to a post-Internet mindset and toward social networking."

Now perhaps the author of the article sliced and diced what was initially a more useful observation, but as is, this left me confused. After all, this was all about coffee, and presumably how to increase sales by making customers happier.

So I ask, dear reader, what is a post internet mindset? And if such a thing can be defined at all (outside of imaginary villages), is Apple the best example of that? If you think about it, take away the internet, and Apple has no products. Hell, take away the internet and you have no social networking either. I suspect what Mr. Muller probably meant to describe was a post-desktop computer world.

So it would seem that our dear professor is just flinging about phrases without much thought of what he is actually saying, or thinking hard, and unable to express himself in a utilitarian way.

His point about email being "out" is the type of trite comment that has been repeated over and over by certain people who I suspect are trying to sound as if they are on the cutting edge (of life in an imaginary village).

For if anything, email is not out. It is just used for a specific purpose in the same way that every other technology has its specific applications. Thus, if I want to send a friend an mp3, chances are, that's traveling as an attachment by email, or I might have a friend download it off of a personal website or myspace page. If I want to hook up with friends, or need to know something RIGHT NOW, then I am probably going to text them. But if I have something really long and detailed to say, that's not happening by text. I might use IM when I am finally home, or email, or the phone. For every purpose a technology.

(In fact, one of the few technologies that is actually dead is the CD, but I imagine the good director still uses those)

Another consultant offers:

"Starbucks coffee houses are a real-world mash-up of Facebook, YouTube and LinkedIn.....Starbucks should observe these groups to learn what products and services they're willing to purchase."

Is the comment above a suggestion to turn Starbucks into a youth oriented Walgreens, with just really really good coffee? What in the world is he talking about?

and still more consultant wisdom:

"Social networking could create "a deeper emotional connection" with its customers", says Kevin Higar, a consultant at Technomic.

Hmmm. You see, they make these statements, and they use the popular tech jargon, but does it really apply? Will any of that help Starbucks increase sales? Maybe, just maybe, the Starbucks concept is as big as it can get here in the United States and nothing will increase sales by leaps and bounds.

So, if you are now holding your USA Today, join me in rolling it up. We are forming a cabal. A posse. A reckless troupe. We are going to find these consultants with their useless two cents, and beat them until we jostle their brains into right thinking.

Fed Cuts, Morgan Buys, Bernanke Masticates

Wow and double wow. You had to think the financial authorities were pulling a weekender, with notepads out, pizza on order, and a WII system and Xbox set up on the big screen in the White House rec room for moments when brainstorming got a bit slow. Trying to figure out how to keep the U.S., ergo the world, from financial collapse is always complicated:

Bush: So guys, whatcha think? I mean, last week we surprised 'em with the $200 billion and had chinese. So pizza this time?
Paulson (Treasury Secretary): I'm down with pizza, not mushroom though.
Bernanke (Fed Head): It's important we get at least five pies though, cause I want extra slices. I'm starved. I'll make the call.
Bush: My mom may stop by with cookies later.
Bernanke: Awesome. We will need plenty of snacks. For tomorrow too.
Tim Giethner (NY Fed Bank head): I love your mom's cookies! Hey where's Jamie?
Bush: He's setting up the Wii and Xbox. We requisitioned a really big screen tv, this baby's huge, given the severity of the economic task before us.
Paulson: I was gonna say, last time we met, when I got beat in Gears of War, that 60 inch screen was just not cutting it for me.
Donald Kohn (Fed Board Vice Chairman): Oh get out of here. You just got beat. Admit it.
Jamie Dimon (JP Morgan Head): Hey guys, it's all set up in the other wing. I brought some barbecue from NY too.
Bernanke: Sweet dog! Love some good 'q.

Group moves to other wing, with assortment of other lesser officials.

Jamie D: Since I set up the Wii, can I buy Bear? They are very scrappy and their employees are loyal.
Bush: If you ask me, they are kind of stupid. All them employees tucking their free cash into Bear stock. Talk about too many penises stuffed into one box. Ha!
Jamie D: Whoa that's just wrong, that sentence! True, but wrong!
Paulson: Well, you want people to feel connected to their firms and have aligned interests ("No thanks, no beer, a Pepsi")
Timmy G: True that. Well tell me Jamie, what do you wanna pay? Market price was around $30 Friday. We wanna move fast no? ("Uhm, Red Bull for me, thanx")
Bernanke: Yea, I mean, lots of counter party risk. Lots of important people invested in Bear like that guy in the UK..what's his name....
Jamie D: I wanna pay $2. ("I'll take an iced tea")
Kohn: Oh get out of here. That's crazy low. And that billionaire in the U.K., he has to be taking a bath now. Probably out like $600 million at $2 share. ("Coffee here")
Paulson: Well we wanna remember we are trying to protect the financial system, not individuals.
Bush: You sounded like a dad when you said that.
Jenna Bush: Hey guys, Domino's is here.
Bush: Thanks hon. Send 'em to kitchen.
Timmy G: Who the hell chose Domino's, their pizza is awful.
Jamie: Yea, we could have brought down some NYC pizza if you had told us. Whose idea for pizza was it anyway. You knew I was bringing some 'cue.
Paulson: Bernie. He wanted to make sure we had enough.
Bernanke: Come on guys. Last time we ran out.
Kohn: So what are we saying with Bear. Do we let 'em bounce?

(Someone arrives)

Alan Schwartz (Bearhead): Hey guys, what's going on. I heard someone say "Let 'em bounce".
Bush: Sup Schwartz
Jamie D: Schwartz!
Bernanke: Pizza is here Alan, AND barbecue!
Paulson: Schwartz yo.
Kohn: Dude.
Timmy G: Schwartz man, you are late.
Schwartz: Sorry. Big fight at the airport. They didn't want to fill the tank of the Bear Jet.
Jamie D: You should try that fractional ownership... like Buffet's Netjets or whatever. Good stuff.
Schwartz: Yea I may look into that. So what's going on? I heard someone say $2. I think we should at least tip the pizza guy a little more. Passed him on the way in.
Paulson: Uhm. Actually...
Kohn: What Paulson is saying is that J.P. Morgan wants to offer $2 a share for Bear.
Jamie D: Well not just $2. We also want the Fed to pay for costs above that, and guarantee about $30 to 100 billion of your assets.
Schwartz: Whoa, what the hell?
Paulson: Uhm, well what the Fed is, uhm..
Kohn: What Paulson is saying is, we will cover $30 billion max Jamie.
Schwartz: But what the F*#$? $2 freaking bux? That kills our Citic deal. What will the employees say to me?
Bush: Schwartz, this isn't about you. It's about the integrity of the financial system. Paulson was saying that earlier.

(Jamie and Timmy move to Wii to play golf with slices of pizza).

Bernanke: Don't you just love the cheese on these.
Schwartz, Bush, Jamie D, Timmy G: NO!
Paulson: Come on guys. Dominos is passable. It's just not like pizza from NY or Chicago or Rhode Island.
Jamie D: Understatement of the year. So, do I get Bear for $2 or not?
Paulson: Yes.
Jamie: And you will backstop us for $100 billion?
Kohn: Weren't you listening? No. $30 billion. No more.
Bush: Awesome. Now we are cracking. Now what else can we do. I am betting huge down market Monday and you Fed guys don't plan on anything official till Tuesday. What are you talking 1%?
Kohn: Yea. That should at least add several billion to bank profits over time, if nothing else.
Bush: Sweet. But what about Monday. Dollar is falling in Asia now.
Schwartz: Did you see that shot over there?
Jamie D: Oh, my golf shot?
Paulson: No, the Arnie Invitational at Bay Hill on the other screen. Tiger just won again. Amazing.
Bush: That looked like a 25 footer birdie putt. Man I just never seen noth'in like that.
Bernanke: alfjalkdjflajlajaljklkajjf
Bush: What Bernie? Take that slice out of your mouth.
Bernanke: What I said was that ties him with Hogan for wins.
Paulson: How he made that shot... that's not an easy shot in any circumstance, let alone a tie situation.
Jamie D: I just did that shot on the Wii like ten minutes ago. Hey, is Jenna coming back?
Bush: She's just here to see her mom. Wedding junk.
Jamie D: She's a cutie.
Bush: Don't make me come woop you Jamie.
Timmy G: That would be double whip, cause I am beating Jamie right now, and bad.
Kohn: Okay okay settle down. The markets will be tight Monday morning, so we need to do something else. Maybe talk really tough or something.
Bush: Why don't we have a different official make a statement every hour tomorrow... ya know, a little positive spin.
Bernanke: We can cut the discount rate to 3 1/4%.
Timmy G: Yea I like the sound of that. Done deal.
Bush: But how about some sort of lendy window thingie for primary dealers.
Paulson: That's so bomb. Awesome. So a lending facility to improve the ability of primary dealers to provide financing to participants in securitization markets.
Bush: Exactly what I meant.
Bernanke: When are they bringing out that barbecue?
Schwartz: I just want to go over one last point before I can totally relax here. Perhaps you've not been reading your Bloombergs, but Bear Stearns's profit exceeded $2 billion in 2006, yet the price JPMorgan is paying is about one quarter the value of the securities firm's headquarters building in midtown Manhattan. The 1.2 million-square-foot, 45-story structure built in 2001 is worth about $1.2 billion, based on the average $1,000 per- square-foot that comparable office space in the city is currently fetching.
Bush: And your point? Cause your pizza is getting cold.
Paulson: Schwartz we do feel your pain. It's all so, embarrassing.
Jamie D: Well MAYBE if you guys had not started this whole thing in the first place by screwing your hedge fund investors last August, you might be able defend a higher price based on dignity. But the dignity bird flew out the window ages ago.
Bush: Come on guys. Let's look at the bright side. We got some stuff done, we got some good food, and now we can spend the rest of the night playing games.
Bernanke:Mmmm. I smell hot cookie. Bush's mom is here!!

S&P Don't See No Bear

Who is this Scott Bugie at Standard & Poors who so astutely offered this wisdom:

"The positive news is that, in our opinion, the global financial sector appears to have already disclosed the majority of valuation write-downs of subprime asset-backed securities,"

According to a Reuters report on Thursday, S&P's statement gave a boost to financial stocks and helped Wall Street indexes pare losses. That report was headlined in many publications in a manner that leveraged up the hopeful slant to ridiculous levels.

And who is this Standard & Poors who the very next day:

"cut its ratings on Bear Stearns Cos and said it may cut them again, after the bank said a cash crunch forced it to turn to the Federal Reserve and JPMorgan Chase for emergency funds." (Reuters)

We are detecting some poor standards.

Bernanke the Wizard Turns Pigs Into Gold

Nothing heightens the surety of what you are doing in the markets than having magical forces from Mount PropUp sweep in to mudddle with the status quo.

The Quo is the steady disintegration of the Dow as it begins to reflect the reality of the economic condition in which we are living. In a world where asset values are falling (dollar/homes/debt) there is no reason for the major stock markets to remain levitated, and yet that won't stop Bernanke the Wizard from using all his powers to do just that.

While some of us (aka me) sat waiting for next week's Fed news, Bernanke, again, pulled a preemptive with the help of his wizard friends in Canada, Europe and elsewhere.

I am not quite sure of the incantation used, by it was something akin to taking the pigs from the village and offering to turn them into stacks of gold. It was not made clear how long the spell would last, but enough people became enthused at the prospect that the markets rose into the air by 416 points.

Yesterday was staggeringly annoying. For ultimately if the problems in the village are not fixed (that problem being excess pig speculation), then we are certainly not out of the fat.

What is worse, however, is the manipulation. Let us wax philosophical for a moment.

You know how people often ask why God does not stop evil? Many people take that question and drive their souls right into the twin villages of agnosticism or atheism.

Let us here think of Bernanke the Wizard as God, and the economy as, well, the world.

We can observe that every area of our economy is hurting not by some arbitrary process, but by the deliberate actions of various groups of people. Homeowners overeaching. Mortgage brokers being a wee bit too aggressive or crooked. People's lack of savings. Wall Street's financial engineering.

In essence God, in the form of Bernanke, gave us life (low rates), and we did some mighty crazy stuff with that financial freedom.

And now we sit, hand in the air saying, "What the hell?" Politicans are pontificating and promising to save us from the evil (of our own doing). Fingers are pointed. Homes are lost. Businesses fall under the weight of sin (debt).

So what does Bernanke, the Wizard do? He can sit back and let free will reign, where every man's will and choices are respected and the chips fall where they may. For why go totalitarian and make people behave? You don't want to force people do be good and create a restrictive environment. That surely is not what you want capitalism to be.

Or, you can interfere, which is what Bernake has chosen to do. He did that yesterday, and a few weeks back, and to little effect. In the process of this interference and attempt to save man from his own freewill, he has in fact violated the freewill of others who did not want the interference. For every time forces from the blue come in arbitrarily, it prevents the individual from making any financial action with confidence.

That is what you get when God makes everything right. You get less freedom. A God who stops evil is a God who keeps you chained to his better judgement, thus defeating his very purpose in giving you life. (That would be, to have free, creative individuals who choose his company by choice).

Bernanke, however, is not quite God. He is a wizard with certain limited powers. None of those powers include the ability to raise the dead, make people do right, or turn illogic into logic, or pigs into gold for more than a few minutes.

Thus we will suffer until our sins are reputiated. Like the prostitute loving governor of New York, Elliot Spitzer, many of us will refuse to acknowledge the results of our own freewill.

Kitchen Sink Level 10: Hillary's Bait and Ditch

With Obama having won Wyoming handily, the Democratic campaign moves its caravan to Mississippi, a land of milk and honey and black people, and where Hillary has fallen out of the political tree to slither her way into the lives of the innocent Mississipians.

With tongue firmly forked in cheek, she and her proxies are now offering a new idea (and again, still reserving the actual kitchen sink for post convention washing up), that perhaps we can have two for the price of one. Sort of the political wonder twins, where Hillary plays the boy. Or a Clintonian version of a buddy flick, where she plays Mel Gibson, and Obama plays the black guy, the sidekick (that would be Danny Glover).

She is not one to let her lack of a lead in voted delegates or the popular vote confuse the issue. Not in her own mind, and certainly not in the minds of the "rubes" down in Mississippi. She is leaving nothing for granted and is treating them, and us all, as innocents in the garden, wandering about mentally naked and unable to see her various tactics.

But let us count a few off:

• Most recently hoisting herself up by John McCain's bootstraps by way of endorsing McCain (and herself) as having reached a certain threshold to be commander in chief. In other words, if you don't vote for Hillary, then as a Democrat your next logical step is McCain? McCain probably has not felt so massaged by the wrong person in quite a long time.
  
• Calling Obama "naive," while at the same time dismissing him as just another Jesse Jackson type. A kind of "double stupid" accusation, with the level of condescension reaching toxic proportions.
  
  
• Implying that black voters are sheep, and that Obama's wins among blacks should be dismissed as "whateverrrr, it's only black people", while ignoring the numbers of educated and young of all races flocking to his campaign. Apparently if you can marginalize someone as the "black candidate", that should be sufficient to declare them unworthy. Not to mention the subliminals it sends to voters in places like Pennsylvania, who Hillary apparently imagines to be racists and a political plus.
  
  
• Approving the lockout of Michigan and Florida delegates up until the point she realized that she needed them. While banging Obama over the matter, she fails to harmonize her enthusiams for those two states with her actual choice in blowing off a bazillion smaller states when she thought she was ahead. Basically she has taken the Giuliani plan, multiplied it by about 12, and got the same inadequate result.
  
  
• She spun the photo of Obama in traditional tribal gear, if not actually being responsible for it (and issuing no denial), knowing that the images would remind people of the non-American components of his heritage. It was a tactic that the Governor of Pennsylvania would surely admit might be a hit with the voters in his state, given his generally low opinion of his own electorate.
  
  
• Attacking the caucuses now, but not then, hoping to use that as part of her argument that she should be the nominee. Behind in delegates, she will suggest that caucus wins are not like real wins, but rather, pretend wins or Fisher Price people wins. And there is a certain logic to the idea that the most loyal and active democrats who show up at caucuses should be ignored...it's called insane logic.
  
  
• The "3am" advertisement in Texas, suggesting that she in fact would be up in the middle of the night not wondering where Bill is, but sitting near the Batphone, secret government camera firmly pointed at your kids, making sure no harm comes their way, or that, like the actual girl in the advert, they don't turn 17 and grow up to be Obama supporters. Apparently, Obama will, somehow, kill your children. She has seen it all before. Remember the genocide in Rwanda? The worst genocide in the past fifteen or so years? Who was by that phone then and wasn't that Hillary "experience" time? As I recall, when that phone was ringing, Bill was getting busy, and Hillary was a bit distracted. Silly me. Foreign moms, and especially African foreign non-soccer moms, don't count.
  
  

And there is more. But it is late, there is work in the morning, and yet still, there is a mushroom pizza sitting on my counter awaiting my lips. It's 12am, and 3am in New York. My cell phone is right here, not ringing. Nobody from Rwanda is on my line saying, "Help, they are using the machetes and it's not to kill a goat for dinner!" Hillary put THAT call on hold. "Uhm, I have Bill on the other line calling from some apartment, can you hold on just a sec. I've been waiting all night for his call," said Hillary last time the phone rang.

So in these past few days we are graced with the latest Hillary apple of deceit. It's the bait and ditch. She is making soothing sounds to the voters in advance of the vote that she will definately lose on Tuesday in Mississippi. "If I win I am open to having Obama as VP" she and others seem to be hinting, by way of saying it.

The outrageousness of this is lost on nobody, and Tom Daschle, former Sentate majority leader and a co-chair of the Obama campaign responded:

"It's really a rare occurrence, maybe the first time in history, that the person who's running No. 2 would offer the person who's running No. 1 the No. 2 position," (from Washington Post)

Yes it is a very audacious tactic. It presumes a level of stupidity of epic proportions among the voting public, and is a subtle way of trying to suppress the vote. The election coming up is in a state where 37% of the population is black, so one can draw ones own conclusions. Her logic assumes that the Obama supporter, aware of his delegate lead, and her position teetering at the gates of hell hath no fury, would sit back and say, "Dang it, I may as well stay home and assure Obama the vice presidency". Like she can be trusted to even follow up on such an idea if we were to toss judgement to the winds and take her up on supporting Obama by demoting him prematurely.

Fortunately people are not so out of their minds, having long ago eaten from the tree of the knowledge of good and evil. We can see things now, so slithering about like the second coming of Satan with a sex change--or as a Monster-- pretty much fools only a certain subset of menepausal suburban women who identify with Hillary due to reasons having nothing to do with good policy, electabilty, or true vision.

Interdependence Tidbits

We will once again try, and try hard, to look away from domestic political events just long enough to reinforce the central theme that the world is not our own anymore.

Interdependence tidbits:

When reading the Wall Street Journal's "Media and Marketing" column last Thursday, we were momentarily suprised to learn that "China's ad market is valued at more than $60 billion annually...and is expected to overtake Japan's soon as the world's second largest in spending terms after the U.S."

Given the general feeling that marketing is akin to fluffery, (when done wrong, as it often is), one becomes amazed at the amount of money devoted to this endeavor with China as the target. Simply stunning. The article talks about the arrival of foreign advertising firms and rising incomes altering the expectations of Chinese consumers (as in, wanting less mediocre commericals).

Nor can you overlook the fall in various commodities this past week, particularly soybeans. Jeff Wilson reports on Bloomberg.com (3/7) of a canceled soybean purchase by China
due to a huge domestic drop in price, and thus:

Soybeans tumbled the maximum allowed by the Chicago Board of Trade, capping the biggest weekly loss since July 2005, after China canceled some contracts to buy soybean oil.

We are used to seeing foreign markets following our lead whether up or down, and here, the polarity is reversed.

Interdependence rising. Along with incomes worldwide.

The article continues:

Rising incomes in countries such as China, India and Brazil have increased demand for meat, dairy products and manufactured food products. Supplies of soybeans and vegetable oil have declined as record energy costs boost demand for biofuels made from oilseeds.

All of this is rather obvious to those who by employment or interest choose to stay abreast of this changing world. But the speed of change is sure to catch someone, possibly the individual investor, possibly the next president, possibly America, totally off-guard.

After Aggressive Stimulation, Ohio Comes for Hillary

Having tossed everything save for the kitchen sink in Obama's direction in the past week, Hillary showed up happy faced in Ohio, anxious to make her speech, and as early in the night as possible. We applaud her tenacity and encourage her to hold on to that sink, for she will need it to wash her mouth and (political) hands when all is said and done.

Lacking the needed electoral feast, but determined to turn a crumb into a hearty meal, Hillary continued to proclaim her experience to the sounds of her audience shouting "Yes SHE can".

It is perhaps telling that Obama's supporters tend to believe in the idea of change (as in, "yes we can make change"), while the supporters of Hillary, at that moment, had narrowed the vision down to Hillary herself.

Certainly Hillary possibly can, and will try. She will continue onward under the hope that the press gets tougher and that scandal involving Obama can be manufactured or found, so that the mathematical certainty of Obama becoming the nominee becomes clouded by character issues and debate. If you imagine that Hillary might have a problem walking across the sensibilities of the half of voters who back Obama, then clearly, you are not thinking at all.

Hillary suggests that she is the hardened one, and able to withstand scandal, which apparently gives her license to use the very methods that she railed against in the past. Further, she can use those methods knowing that for Obama to respond in kind risks compromising his central theme.

Of course McCain has had an easy time of it this past week. He barbecued ribs for reporters, and today accepted his coronation as King of Republicania. Huckabee bowed down, and out, and pledged allegiance.

But watch! Watch! For numeracy is not lost on Hillary's strategists. They know that the only way they can win is by virtue of swaying the superdelegates. The only way you can sway the superdelegates when you lack a lead in voted delegates or the individual vote count is to show that your opponent has negative qualities (and non-policy negative qualities) that warrant overturning the will of those voters.

Having lost all dignity, but still owning the sink, expect Hillary to get down low, to knees if necessary, knowing she can wash off when done.

Dollar Seceding from Community of Currencies

Somewhere we got caught up in the political swirl, our true task neglected to the extent we are babbling about politics without making any related analysis about money.

So we now set aside our brief Obamic delirium, but will follow in his footsteps by lifting liberally from an article by one Judy Shelton in last Friday's Wall Street Journal. She is an economist and someone we've never heard of before, but her piece, "Security and the Falling Dollar", is important reading. Indeed if an anonymous rabbit had written it, or a rock cried it out with verbal eloquence, I would be all over it, nearly plagiarizing it for your benefit.

Friday's Journal actually had more than a few worthy articles, including one on the rising prices of agricultural commodities, which fit quite nicely with what Jim Rogers (the bow tied investor once connected to George Soros, and now living with his wife in, I believe Singapore) was saying in an interview almost two years back in the book, "Inside the House of Money" which I have been slowly making my way through.

Judy starts off by informing us that the Director of National Intelligience pegged the falling dollar as one of the major national security issues facing the United States. Not merely the fall of the dollar, but the ascendency of foreign governments with new resources at their disposal, and their ability to influence the world (and the U.S.) financially for political purposes.

The fact that it takes very little on the part of a few nations to greatly cause the quality of life in America to meander in unpleasant directions is a message not preached at the campaign rallies.

And when we read of the general triumphant applause by U.S. political elites over Kosovo's rash decision to unilaterally declare independence, there seems to be a certain lack of realization that our financial world position grows more tenuous to the extent we are actually not considering other nations, their rational (or irrational) choices, and the impact of those choices. In other words, you can't walk tall, or straight, if you have no pants or carry no stick.

And increasingly we are that naked Emporer.

In her article Ms.Shelton points out various realities that ought to be somewhat disturbing, though not because the events are in themselves wrong actions by others. I fully expect the world to play up to their potential. That is, I expect nations to build huge piles of currency if they feel it's in their interest. It's rational for an Iran to want nukes or China to want more nuclear subs. I fully expect Valdimir Putin to be praised in his country for pulling it together and snatching the assets back from the democratic kleptobillionaires who grabbed up assets as the country collapsed, because it's natural for people to want a country they feel is strong, stable and benefitting more than a lucky seven. These attitudes and events should, however, be expected, considered normative, and factored into our expectations and how we conduct ourselves.

(Interestingly, in the same book, the ever astute Jim Rogers points out the rational reality of Putin's actions, while still proclaiming that the country is crooked and will ultimately disintegrate into multiple parts).

Our leadership has a tendency to expect the world to be rather thankful for mere existence, and we, deep down, are not ready for them to do a bit more than exist, for them to compete. We certainly are not ready for say, a situation where one of OUR native ethnic groups decides to secede, with the support of say, Russia and the UN, though we are well able to have the lack of judgement that European nations like Spain and Greece have. (Both knowing that they themselves have restive separatist groups, and that such groups exist all over the planet, and thus it behooves them to avoid getting the jollies over Kosovo secession).

Our shortsightedness and deliberate disregard extend to the U.S. dollar.

The article continues:

If gold and foreign currency reserves were the only prerequuisite for harboring global ambitions in the monetary arena, China could make impressive claims of its own with $1.7 trillion as of December 2007., the world's highest level. Japan comes in second at $973 billion.

It goes on to say that the European states have $511 billion, and Russia has accumulated $484 billion.

The article points out that Putin has called for denominating its vast oil sales in rubles instead of dollars and certain middle eastern nations have been making noises along the same lines.

American citizens by and large do not fully appreciate the benefits of having the language and currency that greases the world's transactions, but to the extent we grow financially weaker, and the dollar also loses value, a very wealthy world will not necessarilly sit back and watch it for long.

Judy suggests a "perfect storm of dollar desertion" with Russia and China and other nations banding together to create a kind of Asian reserve currency.

All of these musings and thoughts by other countries are important to the extent that the world is interconnected and to the extent we are the world's leading debtor needing foreign funds to keep us chugging along. Right now we happen to be in a position where the promise of even lower interest rates does not inspire confidence in those who must sell their assets in dollars, nor do our economic woes give us much room to be less inflationary in our policy.

These are issues that need to be discussed, and by the candidates.

Ms. Shelton then takes what I call a "sharp right turn." I have a friend who does that. We can be having the nicest conversation about some woman, how lovely her she is, how sweet, how smart, how tasteful in dress and then, bang, out of nowhere, he says, "I would do her really hard".

Whoa, whoa what??!?!? Ms. Shelton does the economic equivalent by suggesting that we return to the gold standard, by virtue of the U.S., Germany and France having the highest level of gold reserves. After pointing out the competitive threats to the United States under the system of fiat currency, she irrationally suggests that the world (who is in competition with the United States) would embrace a hard currency system dominated by the U.S, and at Russia's expense.

Right questions, ridiculous answers.

How about this:

How about we balance the budget, and reduce the national debt?

Our problem is not being on gold, or off gold, or even the dollar fluctuating. Our problem certainly is not other nations trying to do what we have always done.

Our problem is shortsightedness and not taking care of our own business. It's investment banks providing funds to mortgage companies that don't do due diligence. It's the United States applauding separatist movements despite the fact that a bazillion nations run the risk of having to deal with now encouraged separatists (the Basques and Kurds are smiling). It's lowering interest rates to bail out banks that should have had a better grasp on risk. It's individuals seeking things they cannot afford. It's funding Saddam to fight Iran then having to kill Saddam. Or funding revolutionaries in Afghanistan to kick out Soviets only to have to go back in to push out the people you financed.

We can quibble on certain details, but we really need leadership that takes a more nuanced view, and a more long term view. I can already see the looks on the faces when the Serb section of Kosovo decides to secede from Kosovo. What will we say then and will we be so supportive?

It reminds me of a person on a blog I was reading. The question was posed about ethnic groups seceding in the U.S. and the person responded, "Oh it can't happen here because it's not constitutional, simple as that". As though countries typically write in secesson rules for their minorities, prenuptial style. Only in the American mind.

Albanian Independence or Afghanistan Redux

Today is a peculiar time, and a time that might come back to bite the United States down some long unseen curve of the American derriere. With the backing of the European Union and the United States, Kosovo, up till now a part of Serbia, has unilaterally declared independence.

ABC News reports on their website that:

"Ninety percent of Kosovo's 2 million people are ethnic Albanian most of them secular Muslims and they see no reason to stay joined to the rest of Christian Orthodox Serbia.

And this is all well and grand, accept that Serbia main, and Russia, are not entirely pleased, with Russia explaining that this will only encourage separatist groups around the world.

And it means jack nothing to most Americans that the U.S. government is not so much making an argument for democracy as they imagine, but rather, for people to split themselves up into groups based on religion and ethnicity.

Putin is astutely aware of the broad number of conflicts that can be resolved by secession, though leaders here never imagine how such ideas, once caught, can spread like a fever.

In and of itself secession is not be such a bad thing, but there is a certain amount of American and European hypocrisy and shortsightedness on the matter.

But let's daydream a moment. Let us suppose that one day black Americans have a candidate who is running for president in a land where they were enslaved and denied rights for many years. Now let us also suppose that in the process of the election he is denied the right to be his party representative through the use of non-elected superdelegates.

Now let us further suppose, that the aggrieved party has core constituents of the same ethnicity who do not look favorably on what they consider to be theft and disenfranchisement. They become even more disillusioned with the nation. They form a BLO, a Black Liberation Organization, with political, military and terrorist wings. They petition the government to let them secede from the country in a state they dominate.

Our government's response is a clear and quick "No." Then Mississippi is declared Blackland, and with the support of the U.N. and E.U., secession is declared.

If the government thus does not give in to this version of "democracy," one would see a situation much like in Israel. Imagine living in a U.S where, periodically, bombs are going off on Wall Street, at your local Cinnabon, in the car parked along the Macy's Thanksgiving Day Parade, in the F train coming from Queens. Imagine four gunmen with automatic weapons and grenades standing at the intersection when your light is red, and the hundreds that can be killed quite easily.

It's a far fetched idea, and yet, those are the things we should be thinking about when we so freely apply solutions to other places that we would not dare consider for ourselves.

It's not so much that anything like that could possibly happen here, but rather, our inability to imagine the long term consequences of these actions we support.

Not to mention that the Albanians who seem to love us now for backing them in their pursuit of independence, might be the very same people who are fighting us in the future as radical Islam gains wider ground. Afghanistan redux.

It's a shame when Putin has to do the thinking for us. Granted there might have been no proper way to resolve this situation, but there should have been more discussion and slower progression so as not to build resentments as a nation sees itself cut down to size.

Oil and the Blood

Will there be blood?

That is the question answered in the Paul Thomas Anderson movie I saw last night, an odd psychologically black and white film where evil, stupidity or hypocrisy is affirmed in nearly every character. In brief, it's the story of Mr.Plainview, an oil man, who builds his fortune by buying up the land at the expense of his own humanity. He serves the dual gods of oil and hate, with a special loathing for people, and people of faith.

Religion is represented by a cherubic faced man-boy named Eli, who is from the family that sold Mr. Plainview drilling rights in the first place. Eli is the town's minister, and essentially a false prophet, and uses every opportunity he can to try to get at the wealth that Plainview represents. His congregation--always seen in groups--are presented as sheep, unable to see Eli for the manipulate imposter he is.

Surprisingly, considering the genius of Magnolia, the director faulters here in the presentation of religion. By making Eli the obvious hypocrite, and his flock the willing stooges that the wily Mr. Plainsview thinks they are, the film almost confirms his worldview, siding us with an alcoholic and murderer.

The oil world is much different now. All grown up and run by huge corporations and national entities. Exxon Mobil announced record earnings on the level of $40.6 billion for the year, the type of attention getting number that let's people without perception skills get outraged. Exactly what a company with over $400 billion in sales should earn is open to question, with those outside the industry supplying the most easily constructed and far fetched non-answers. But they know it should be lower, so that it creates less confusion between having your cake (driving whatever car you like to wherever you like) and eating it too (paying ridiculously low commodity prices at the same time a good portion of the rest of the world-China, India- is industrializing).