Thursday, July 9, 2009

Paul Krugman, "Misstating the Problem?" More Than You Know

"Bruce Bartlett misstates the problem. He says: The problem is that the Obama administration was much too optimistic about how quickly stimulus spending would affect the economy. Christina Romer, chair of the Council of Economic Advisers, and Jared Bernstein, chief economist to vice president Joe Biden, forecast in January that the stimulus would reduce unemployment almost immediately. Um, that’s totally false. Did Bartlett even look at the Bernstein-Romer paper? Here’s the key graph:
The predicted impact from the stimulus is indicated by the difference between these two curves. We’re now at the very beginning of 2009Q3; they predicted that the unemployment rate right now would be only a fraction of a percent lower now than it would otherwise be. The impact wasn’t supposed to be really noticeable until late this year, and wasn’t supposed to peak until late 2010.

The problem, in other words, is not that the stimulus is working more slowly than expected; it was never expected to do very much this soon. The problem, instead, is that the hole the stimulus needs to fill is much bigger than predicted. That — coupled with the fact that yes, stimulus takes time to work — is the reason for a second round, ASAP."
- Paul Krugman, http://krugman.blogs.nytimes.com/2009/07/05/bruce-bartlett-misstates-the-problem/

Think this through for yourself, then decide if they've been telling you the truth. Consider the graph above. Also understand that Paul Krugman won the Nobel Prize in Economics last year. Then review the post below in which John Williams from "Shadow Stats" shows that true unemployment is already at 20.6%, here:

The graph above shows peak unemployment at roughly 9.5%. If that figure is used as the basis for an additional "stimulus" plan, when in reality the true figure is already 20.6%, how can it possibly address the real situation? Paul Krugman is obviously a very smart person, which leaves us with only two viable alternatives to choose from: if he honestly believes the 9.5% unemployment figures then he, a Nobel Laureate in Economics, is woefully ignorant of the actual state of the economy; or he's deliberately lying, minimizing the true scope of the disaster, probably to prevent panic and maintain relative calm among the public. Either choice is unacceptable... CoyotePrime

"The 'Andrea Gail' World Economy"


A video analogy of what's coming, not just for the American economy, but the entire world...
From the movie "The Perfect Storm."

H.L. Mencken



"The world always makes the assumption that the exposure of an error is identical with the discovery of truth - that the error and truth are simply opposite. They are nothing of the sort. What the world turns to, when it is cured on one error, is usually simply another error, and maybe one worse than the first one. "
- H.L. Mencken

"Positive Emotions Increase Life Satisfaction, Resilience"

"People who seed their life with frequent moments of positive emotions increase their resilience against challenges, according to a new study by a University of North Carolina at Chapel Hill psychologist and colleagues. The study, "Happiness Unpacked: Positive Emotions Increase Life Satisfaction by Building Resilience," appears in the June issue of the bimonthly journal 'Emotion.'

"This study shows that if happiness is something you want out of life, then focusing daily on the small moments and cultivating positive emotions is the way to go," said Barbara Fredrickson, Ph.D., Kenan Distinguished Professor of Psychology in UNC's College of Arts and Sciences and the principal investigator of the Positive Emotions and Psychophysiology Laboratory. "Those small moments let positive emotions blossom, and that helps us become more open. That openness then helps us build resources that can help us rebound better from adversity and stress, ward off depression and continue to grow."

In the month long study, 86 participants were asked to submit daily "emotion reports," rather than answering general questions like, "Over the last few months, how much joy did you feel?" Getting those daily reports helped us gather more accurate recollections of feelings and allowed us to capture emotional ups and downs," said Fredrickson, a leading expert in the field of positive psychology.

Building up a daily diet of positive emotions does not require banishing negative emotions, she said. The study helps show that to be happy, people do not need to adopt a "Pollyanna-ish" approach and deny the upsetting aspects of life. "The levels of positive emotions that produced good benefits weren't extreme. Participants with average and stable levels of positive emotions still showed growth in resilience even when their days included negative emotions."

Fredrickson suggested focusing on the "micro-moments" that can help unlock one positive emotion here or there. "A lot of times we get so wrapped up in thinking about the future and the past that we are blind to the goodness we are steeped in already, whether it's the beauty outside the window or the kind things that people are doing for you," she said. "The better approach is to be open and flexible, to be appreciative of whatever good you do find in your daily circumstances, rather than focusing on bigger questions, such as 'Will I be happy if I move to California?' or 'Will I be happy if I get married?'"
Barbara Fredrickson is the author of the book "Positivity: Groundbreaking Research Reveals How to Embrace the Hidden Strength of Positive Emotions, Overcome Negativity and Thrive"
(Crown Publishing, 2009).

Astronomy: "Pentimento: Beyond the Great Void- What?"

"Pentimento: the reappearance in a painting of an underlying image that had been painted over (usually when the later painting becomes transparent with age)."
"Earlier this year astronomers from the University of Minnesota discovered a massive void of space that measured nearly a billion light years across. It was an intriguing discovery, in a universe that is filled with seemingly infinite objects. Cosmic gaps aren’t uncommon though, but the fact that this one was nearly 1,000 times larger than the average expected gap, suggested something different. The team was working with sensor data retrieved by the NASA’s WMAP (Wilkinson Microwave Anisotropy Probe) satellite. The hole measured roughly 10,000 times as large as our galaxy or 400 times the distance to Andromeda.

What was even more fascinating was the fact that a hole this size was essentially impossible to explain under the constraints of current scientific theory. Enter University of North Carolina at Chapel Hill physics Professor Laura Mersini-Houghton. Mersini-Houghton has put forward a theory that has stunned the wider community. “Standard cosmology cannot explain such a giant cosmic hole.” The real kick of it though, comes next, in what is being termed a groundbreaking hypothesis; she describes the hole as “… the unmistakable imprint of another universe beyond the edge of our own“.

Mersini-Houghton’s theory posits that there are in fact two giant holes, one in each hemisphere of our universe. The one that has been recently discovered is in the northern hemisphere, and there should be another one in the southern, according to her theory. What’s more, with more data and information coming in, her theory can be refuted or confirmed. Whether she is on the right track, we are yet to see. But this is a track that, apparently, will have at least an end – where we find that she is incorrect – or will see us be tripped on to a new track, of new thinking and understanding."

"How It Really Is"

Ayn Rand

"That which you call your soul or spirit is your consciousness, and that which you call 'free will' is your mind's freedom to think or not, the only will you have, your only freedom, the choice that controls all the choices you make and determines your life and your character."

- Ayn Rand, "Atlas Shrugged"

"Just Snoring, Or Sleep Apnea?"

"It's been nine years since Kim and Curtis Christiansen were married. Since then they've had their ups and downs, but they've remained close. But when Curtis began snoring about three years ago, Kim began sleeping on the couch. After his snoring drove his wife, Kim, to sleep on the couch, Curtis Christiansen saw a sleep specialist. "His snoring was so loud. At first I would just elbow him to wake him up," she said, "But then I became concerned. He would just (she gasps for breath). It would take his breath away."

At first Curtis Christiansen figured he was tired, a little run down from his job. He thought the snoring was just a symptom of his exhaustion. But when he started nodding off while waiting at a traffic light, he knew something was wrong. "I became more aware of this choking and waking-up feeling," he said. Kim Christiansen finally persuaded her husband to go to a sleep specialist. The diagnosis: obstructive sleep apnea. According to the National Sleep Foundation, more than 18 million American adults have sleep apnea, and many of them don't know it. Some people think their snoring is just a side effect of a busy lifestyle.

In some cases, that's true. But the foundation says it's trying to get more people to realize how important it is to know the difference between occasional snoring and apnea. Studies have shown that sleep apnea has some serious side effects. A disorder in which breathing is briefly and repeatedly interrupted during sleep, apnea occurs when the muscles in the back of the throat fail to keep the airway open, despite efforts to breathe. That can cause broken sleep patterns and low blood oxygen levels. Doctors say these side effects can lead to hypertension, heart disease, and mood and memory problems.

In a recent study at the University of Maryland Medical Center, researchers found that sleep apnea can cause a rise in depression and that sleep-related breathing disorders can also worsen nightmares and post-traumatic stress disorder. And because sufferers are usually sleepy during the day, apnea can increase the risk of automobile crashes. There's no question it can be life-threatening, doctors say.

So how do you know whether your snoring is something more serious? When snoring starts to affect your daily habits, you should see a doctor, said Dr. Thomas LoRusso, director of the Northern Virginia Sleep Diagnostic Centers. "A bed partner may notice that the patient stops breathing and snores loudly, " LoRusso said. "And the daytime symptoms are sleepiness, poor concentration, problems waking up in the morning." LoRusso says a good way to check your sleep habits is to note your levels of fatigue during the day and jot down other symptoms you might be having. And if you have a bed partner, ask whether he or she has noticed any "choking or gasping while you snore," he said. "The person you sleep with, many times, knows your snoring better than you."

Specific lifestyle changes can help you avoid sleep apnea, the Sleep Foundation said. LoRusso agrees. "Cut out the alcohol," he said. "It can make the upper airway muscles relax." And watch your weight. Losing pounds can "cure" sleep apnea, especially for overweight people, LoRusso said. If you smoke, try to quit, he said. Smoking creates swelling in the upper airway, making apnea worse. These seemingly small changes can have dramatic results. "In some cases, changing these factors can eliminate sleep apnea from some patients," LoRusso said.

For Curtis Christiansen, it wasn't that easy. Not only was he thin and a non-smoker, he suffered from high blood pressure and high cholesterol and, because of a previous health issue, had only one kidney. He needed help immediately. His doctor recommended a device called a CPAP, or continuous positive airway pressure device. It's a mask or nose piece that blows air into the airway to keep it open while a patient sleeps. Although surgery is an option for those who have problems even with the CPAP, Christiansen wasn't one of them. Since his diagnosis, Christiansen has gotten his blood pressure under control. When he started wearing the CPAP, he confesses, he'd leave it behind when he went out of town. "But I found I wasn't getting a good night's sleep, so now I take the CPAP along," he said with a smile, "and I have a restful vacation with my wife."

William Paley



"There is a principle which is a bar against all information, which is proof against all argument, and which cannot fail to keep man in everlasting ignorance. That principle is condemnation without investigation."
- William Paley (1743-1805)

The Economy: Karl Denninger, "De-Leveraging? Uh, no."

"So Dennis Kneale decides he's going to cite me this evening on his show, claiming that I make a "decent argument" but fail to present numbers. Well Dennis, I don't think I should have to recite the last two+ years of numbers, nor the litany of new Fed Credit programs, nor the consumer credit numbers which were released today and which your network reported this afternoon, when you're the one claiming that "the recession is over" and argue against the credit recession position I put forward. Here's the consumer credit numbers talked about today when they were released (click for a full-size window):
Now I want you to pay particular attention to the current total leverage held by consumers - that is, the total amount of debt, excluding mortgages. In 2004 consumers held $2.191 trillion. At the peak, they held $2.582 trillion. Today, less than three quarters later, they have cut back by an astounding $62 billion dollars in total, or a whole 2.36% - an absolutely inconsequential amount. Consumers have de-leveraged? Uh, no.

In the meantime the claim is made that financial institutions have taken down leverage. Oh really?
Let's start with this (click for full screen):
That's total credit market instruments, all sectors, and it is still rising. In fact, it is rising fast - very fast! Currently at $52.9 trillion dollars, up from $50.7 1Q 2008, and up from $31.9 trillion in 2002.

The Bank of International Settlements (BIS) says that the total amount of outstanding derivatives has reached a nearly-incomprehensible $1.28 quadrillion dollars. Oh, and this does not include derivative positions related to the commodity markets. Further, the outstanding amount has increased at a double-digit percentage rate over the last 12 months.

European banks are still geared at 30, 40 even 50:1. Go look up the leverage ratios for Deutsche Bank, among others. Make sure you're sitting down. Our own banks have refused to take their SIV and other off-balance-sheet garbage back onto their balance sheets, and thus are intentionally understating their leverage ratios. Fannie and Freddie are still geared at over 80:1, although under conservatorship. Our banks have de-leveraged? Uh, no.

Now, The Fed. Its balance sheet has more than doubled and is now approaching $2 trillion dollars - a near-100% gain in the last 12 months. The Fed has de-leveraged? Uh, no.

Our government is next up. Let's cite the NY Times: 'Through April 30, the government has made commitments of about $12.2 trillion and spent $2.5 trillion. Our total outstanding public debt is about $6 trillion, up by a full trillion in the last year, and we're on-plan to add $1.8 trillion to our public debt this fiscal year - that's a 30% increase.' Government has de-leveraged? Uh, no.

We are in a credit recession. We cannot get out of the credit recession until the conditions that led to it no longer exist. The conditions that led to it are too much debt and too much leverage, and yet the prescriptions of both the Bush and Obama administrations are to add even more debt and more leverage to the system, shifting bad debt around and stuffing it under the rug in an attempt to hide systemic insolvency, rather than force it into the open and demand that the excessive leverage and debt be either paid down or defaulted.

Consumers are in a mad dash to pay down debt rather than default where they are able, but as you can see they've only managed to get rid of $60 billion - that's the shift in the "savings rate" you're seeing. As I've noted consumers are not saving, they're paying down debt - but at this rate it will take five or more years before consumers alone are sufficiently de-levered, and that will leave all of the nearly $14 trillion dollars taken on in additional leverage by our government to prop up failed institutions outstanding.

No, the recession is not over, and until our government stops propping up the liars and thieves, preventing the bad debt from being defaulted and removed from the system, any relief from this economic malaise will be fleeting at best."

- Karl Denninger, http://market-ticker.denninger.net/

"What Recovery? 'Green Shoots' Lies"

"There are those that honestly think you can make a sustainable economy based on people buying things they don't need with money they don't have. Then there are those who just want to sucker in the sheeple so they can fleece them one more time. Finally, there are the sheeple themselves - so scared that they will buy into any feel-good message about Green Shoots that the politicians and media sells them, and even defend it.

What none of these three groups want is for the general public to know what the actual numbers really are. They don't want me to show you what I am about to show you.

There's been two studies done recently that put things into perspective. One was done by Barry Eichengreen and Kevin O’Rourke, both professors of economics. The other was done by Paul Swartz for the Center of Geoeconomic Studies.
As you can see, worldwide industrial output is dropping as fast as it did during the Great Depression, while world trade is dropping even faster (which makes one wonder if Smoot-Hawley really wasn't as big of a deal as some make it out to be). The other two charts show monetary inflation and massive government deficits. The two are directly related. Those academics who are afraid of deflation think that these are good things. Consumers that are trying to stretch their meager paychecks think otherwise.

Some will try to write off the charts above that this doesn't reflect what is happening in America. As if America is some sort of island disconnected from the rest of the world. As mentioned above, we have managed to avoid deflation with our massive deficit spending, but that also means the prudent are being punished in order to bail out the debtors.
Finally we have unemployment. The common refrain from the Green Shooters is that the unemployment rate isn't nearly as bad as during the Great Depression, when unemployment hit 25%. While technically true, it is also dishonest for two reasons:

#1) Unemployment didn't suddenly jump up to 25% overnight. It took four years to get there. If you start counting from April 2008 (around the time that Bear Stearns went under), then we are only 14 months into this Depression. The equivalent period of time during the Great Depression would take you to the fall of 1930. So what was the unemployment rate in 1930? 8.7% What is the unemployment rate today? (Officially) 9.4% (True unemployment rate is 20.6%*)

#2) The unemployment rate was measured differently during the Great Depression. For instance, there was no "discouraged workers" category. You were either employed, or not employed. You didn't fall out of the ranks of the unemployed because you didn't send someone a resume that week. Thus the unemployment numbers of today will understate real unemployment in a way that they wouldn't during the Great Depression."

- http://www.dailykos.com/story/2009/6/20/744258/-What-Recovery-Green-Shoots-Lies
http://gjohnsit.dailykos.com/
*http://coyoteprime-runningcauseicantfly.blogspot.com/2009/07/true-unemployment-rate-already-20.html

The bottom line to all this? The government is terrified of the public response if they were made aware of just how truly hideous the situation is, and will LIE all day long to keep you misinformed, and passive...

Karl Denninger, "Retail Sales and Unemployment"

"Notice the language here:

NEW YORK (AP) - 'Escalating job worries and rainy weather dampened shoppers' appetite for buying summer staples like shorts and dresses, resulting in sharp sales declines for many merchants.'

Dampened appetite? Bah. Here's a reality check - consumer credit capacity has hit the wall. I noted this over a year ago, and started yelling about it. The shift of consumer spending to credit cards - the highest-interest means of financing payment - became apparent in the consumer credit report about that time.

This marked the final desperate attempt to keep spending beyond our means by the average American sheeple, and it was doomed to failure. Now the failure is evident in consumer spending numbers across the board - including at bargain outlets like COSTCO. Walmart stopped reporting their numbers. Gee, do you have to wonder why? They've got one of the best internal systems in existence for tracking who's spending and how much on what. In the months leading up to their cessation of reporting the shift to "necessary" items (e.g. food) was obvious in their reports.

Its against the law to lie, but nobody says you have to report this at all, so Walmart took the "easy way out" and simply stopped talking, rather than expose the truth where people could see it. That doesn't change what the truth is, of course.

The obvious next question is what the impact on GDP is when retailers are reporting 6-10% declines in retail sales numbers, we have a ~30%ish drop in vehicle sales rates expected on a permanent basis by the automakers, and every indication is that a similar contraction is showing up in virtually every area of discretionary spending. Remember, when consumers spend less producers need to produce less, which means more people get laid off up and down the line - from production to sales to management - which of course causes an even larger drop in consumer spending.

"What is a 20% or more decline in GDP, Alex?"

This morning the market spiked based on the "better than expected unemployment numbers"; initial jobless claims 565,000 instead of 603,000 expected. But let's not forget that this is still a half-million people who filed unemployment last week, never mind that Friday was July 4th and the unemployment offices were closed! So we had a 4 day week instead of a 5 day one, and yet people jump up and down and scream "green shoots!"

Someone needs to remind people that when you remove 20% of the reportable days from a week, you shrink the reportable number by 20% or so too (less whatever behavioral shift has people showing up the previous day.) Rick Santelli threw the appropriate amount of cold water on this report, given that continuing claims are now up to 6.88 million - up more than 170,000 over estimates!

As I have repeatedly said, continuing claims are what count - it is not whether you lose your job, it is whether you can find a new one. If the answer is no, the continuing claims number will continue to ramp even though the "initial claims" number comes down. The answer is "no" to the question of "if you get laid off, can you find a new job?"

Don't listen to the fools - there is no "green shoot" in that report."
- Karl Denninger, http://market-ticker.denninger.net/

Wednesday, July 8, 2009

A Moment With Nature, Walt Whitman

"This then is life.
Here is what has come to the surface after so many throes and convulsions.
How Curious! How real!
Underfoot the divine soil, overhead the sun."

- Walt Whitman

Hermann Hesse

"You know quite well, deep within you, that there is only a single magic,
a single power, a single salvation...and that is called loving.
Well then, love your suffering.
Do not resist it, do not flee from it.
It is only your aversion to it that hurts, nothing else."
-Hermann Hesse

The Daily "Near You?"

Sonoma, California, USA. Thanks for stopping by.

"Preparing For Civil Unrest"

"The most remarkable thing about civil unrest is that there hasn't been more of it. Politicians are making a hash of this country- and much of the rest of the civilized world. We know it. They know it. They know we know it. But we don't feel we can do anything much to stop them. That right there is the pre-condition for civil unrest- when people are frustrated and politicians are nervous. Worse, that was how things stood before last fall's crash. Before pols on both left and right launched the biggest mass transfer of wealth in history-transferring our wealth (what we had left of it!) to their friends on Wall Street and in the banking industry. In other words, that's how things were before things got bad!

Now everybody's talking about the ongoing catastrophe (even if we are in a momentarily sunny mood). But almost nobody is talking about the logical-maybe even inevitable-consequences of cynical or desperate politicians abusing an already fed-up populace: civil unrest. I mean people taking to the streets. Or mass resistance. Or crackdowns because the government fears we might do something to upset its apple cart. It's going to happen. Somewhere. At some time. It's going to.

One of the few VIPs to mention the matter openly was Zbigniew Brzezinski, former National Security Advisor and the ultimate insider's insider. He commented on the millions of unemployed or soon-to-be-unemployed and the "...public awareness of this extraordinary wealth that was transferred to a few individuals at levels without historical precedent in America." He told "Morning Joe" Scarborough, "Hell, there could be even riots." I'd say that's an understatement.

Although few in power are talking about it, rumors abound that governments at many levels are planning for civil unrest. One rumor is about a document supposedly being circulated right now among top federal officials. It's called the "C&R Document"-with C&R standing for "conflict & revolution." The much-storied paper is said to be a plan for controlling the American people when we get out of hand. True? Who knows. But the very rumor tells us a lot about these times. Other things are not mere rumor. When the federal government established a North American Army command in 2002, its purpose wasn't to repel foreign invaders. It was domestic operations-something long and rightly forbidden by the Posse Comitatus Act. In February of 2009, when military commanders in Canada and the U.S. signed a pact allowing their armies to operate inside each other's country they didn't even bother to get authorization from Congress-an illegal and unprecedented move. And once again, the purpose was handling "domestic civil emergencies."

For several years, the Centers for Disease Control tried to get states to adopt something called the Model State Emergency Health Powers Act (MEHPA). This act would allow state governments to become police-state dictatorships in event of any ill-defined health emergency-vaccinating people by force, destroying or seizing property without compensation, and rationing medical supplies, food, and fuel. To their credit, most state governments rejected the act. A few adopted portions of it before a fervent opposition campaign caused the CDC to back off. However, the concept of a health dictatorship hasn't gone away. Not hardly. Within days of the news that a new strain of swine flu had arisen in Mexico in April 2009, states were again considering legislation to give themselves martial-law powers in event of an epidemic. And what of the dozens and dozens of federal agencies that now have SWAT teams? Seriously, what justifies the Bureau of Land Management or the Department of Housing and Urban Development having paramilitary units?

Now maybe you like the idea of an Army that watches over its own citizens. Maybe it makes sense to have a government seize total dictatorial power in event of a health emergency. Maybe you believe SWAT teams will never be used except against bad guys. But do you really trust these people? After all, these are the same folks, and this is the same mentality, that not only spent $325,000 to produce a souvenir photo of a presidential 747 zooming low over the Statue of Liberty, but ordered the New York Police Department, the FBI, the Secret Service, and the New York mayor's office not to tell the public. Never mind that they realized full well that passenger jets and military planes plunging low over Manhattan would evoke panic.

Still, peace reigns. Mostly. At least here in North America. But not everywhere. Not long ago, France was brought to its knees by night after night of rioting. In that country it's become almost common for workers to hold their bosses hostage in hopes of winning economic concessions. Greece, too, saw its normal life and business shut down by days of rioting. So did Iceland-a country that's normally the picture of civility.

Can the U.S. be forever immune? It might not take much-and it could be something out of the blue, something impossible to anticipate-to set us against each other and against the "Trust us; we'll fix it" political crowd.

In a way, this national silence on a matter so many people are afraid of is similar to the silence about general preparedness issues before 9-11 or Hurricane Katrina. Only Mormons and us wingnuts spoke of preparedness way back when. Since then, of course, advice on preparedness is mainstream and common. In another sense, this silence is different. Because when unrest finally erupts, it's not going to be us merely taking care of ourselves. It's going to be "us against them." It might be workers against bosses. Or the poor against bankers. Or blacks against Hispanics. Or little folk against Big Men in public office. Or farmers against the USDA. Or xenophobes against xenophiles. But however it happens, the implications aren't as Boy-Scoutish as just taking care of ourselves in an emergency.

Look up "preparations for civil unrest" on Google and...What's that echo I hear?- you'll find nothing that's going to help you. In fact, you won't even easily turn up a good definition of what civil unrest is. Like "indecency," the definition seems to be in the eye of the beholder. I wouldn't consider a peaceful anti-war march to be civil unrest, for instance, but a police chief might. Similarly, I wouldn't consider acts of localized non-violent lawbreaking (like environmental activists chaining themselves to a tree) to be civil unrest; but a timber company official probably believes otherwise.

Civil unrest occurs when anger, frustration, or fear turn disruptive on a mass scale. Or when government officials crack down because they anticipate such disruptions. Crackdowns can lead to further frustration, leading to further crackdowns and so on-especially when the crackdowns look unwarranted and tyrannical. In other words, civil unrest can arise from the anger of people or the folly of government or both together. Anger over an unpopular policy, a new war, a collapse of the currency, panic over a pandemic, a food shortage, a bank run-anything like that could cause civil unrest, especially in a population that's already on edge and no longer trusts its authority figures.

Another thing you won't find via Google is how various types or levels of unrest are likely to affect us and how we should respond, if we're affected. Again, although the men and women at the top are quite concerned for their own sakes, they (and their media mouthpieces) would rather not talk about what we should do in event of civil panic. But that's not good enough for we independent-minded people, is it?

Here are my definitions of levels of civil unrest and a little bit about how they might affect us:
LEVEL ONE: The lowest level of civil unrest is when people turn on their own neighborhoods-as happened during the race riots of the 1960s and the Rodney King riots in Los Angeles. Level One civil unrest can be deadly and destructive, but primarily to people who live, work, or must travel in the immediate area. Level One unrest is spontaneous, Dionysian, is confined to a narrow geographical zone where the protestors live. Police response may be harsh, but it's localized. Unless you're in the middle of it, you're unaffected.

LEVEL TWO: Level Two civil unrest may also be focused on a single area. But in this case, rioters or protesters have deliberately targeted a business district, a facility, a transportation system, or an organization to impose maximum disruption. One example: the World Trade Organization protests in Seattle in 1999; young people with violence in mind and rage in their hearts attacked an entire downtown, affecting hundreds of businesses and tens of thousands of workers who hardly knew what hit them. Another example: This spring, protesters in Thailand shut down the Bangkok airport, affecting who knows how many individuals and businesses. Level Two unrest is usually planned or semi-planned. The target is chosen deliberately. Although still focused in one area, Level Two can disrupt normal life and business in a whole region or country.

LEVEL THREE: Level Three comes when mass unrest or authoritarian crackdown causes disruption at state or regional level. Then, no matter what the original cause or location of the trouble, everyone in the region is affected. Effects might include travel restrictions, random ID checks, mass arrests, food and fuel rationing, controls on money and banking, roadblocks, and other harsh "emergency" restrictions.

LEVEL FOUR: Level Four is Level Three- but on a national or even international scale. It's martial law. If things ever get this bad, it's likely that the government itself will be a far bigger threat to everyone's well being than whatever the original cause of the clampdown was. And of course, any level of civil unrest can lead to laws, regulations, and harsher police policies that end up affecting everybody in the long run.

We make a mistake if we think civil unrest is strictly an urban phenomena. It can happen anywhere. When 400 government agents and soldiers descended on one isolated family in the Idaho mountains, the roadblocks, helicopters, Humvees, media presence, and furious protestors surrounded the Randy Weaver family and brought the normal life of Boundary County, Idaho, to a halt. The siege against the Branch Davidian church in Waco, Texas, wasn't conducted in the inner-city, either. Yet both of these were large scale catastrophes with all the hallmarks of civil unrest-individuals or groups resisting, government insisting.

I can easily envision strictly rural-based unrest that urban dwellers will never even hear about (except perhaps in highly distorted reports). What happens, for instance, if farmers, 4H families, owners of saddle horses, and holders of small chicken flocks decide to resist en masse the National Animal Identification System (NAIS)? It's easy to imagine, in these crazy days, USDA SWAT teams descending on the countryside to make arrests, forcibly register or destroy non-compliant animals, and burn down non-registered facilities. The future could see rural resistance to invasive census-taking, forced vaccination programs, land takings, water-rights policies, or the destruction of herds for real or bogus health reasons. As country people increasingly see governments as foreign organizations driven by the interests of city dwellers, pharmaceutical companies, and mega-agri-business, it wouldn't surprise me. If we ever have serious food shortages, expect rural areas to be besieged.

Even when civil unrest confines itself to the cities, airports, or highways it can affect us in crazy ways. Here's a funny example of unpredictable (in this case mild) consequences. A friend was due to have her first book published in Canada. She was very excited-then disappointed when weeks dragged by and the book didn't appear. Turns out that a band of Indians was blocking a highway bridge the printer's truck had to cross. The union truckers, in solidarity, refused to route around the protest. Just one small consequence. But you can see the unpredictability.

The simple truth is that we don't know what kinds of unrest to anticipate. We don't know when, or if, we'll see civil unrest. But thinking about the problem and preparing ourselves mentally and physically to deal with it should be just another aspect of our personal preparedness. What we can do:

1. Keep standard emergency preps up to date. First thing to do is make sure all our typical household preparedness supplies and plans are current. As BHM readers know, backup food, water, and other supplies are our mainstay for everything from bad storms to long-term unemployment, from power outages to social breakdowns. During civil unrest, especially at Level Three or Four, we might not be able to get out to buy things we need-or we might consider it more prudent to stay at home. On the other hand, if we ourselves are part of the unrest, we may need those supplies to sit out a siege.

2. Don't fall into foolish complacency. We who live in the country tend to have an "it can't happen here" attitude toward political violence or social upheaval. We see those things as urban pheonomena. And mostly, they are. But there's no ironclad rule that says they have to be. If anything disrupts the supply chain, for instance, rural areas could be the first to be cut off from food, medicines, fuel, or other necessities. If government breaks down to the point where it can't deliver food stamps, housing vouchers, social security, or bureaucrats' pay, the rural poor and unemployed could become just as restive as their urban counterparts.

3. Watch your health. As I write this, the airwaves are shrilling about swine flu. This outbreak may fizzle; after all, perfectly normal flu kills many every year without causing panic, martial law, or incessant media coverage. On the other hand, it's certain that one day some illness will rampage across the globe. Few things inspire public panic more quickly than contagious disease, and once again rural areas are not immune. Take all the standard recommended precautions like frequent handwashing. Make sure your preparedness kit includes surgical masks and disposable gloves as well as a selection of frequently updated medications. And be ready to lay low at home for a long time in the event a serious plague gets loose.

4. Make common cause with your neighbors. I've said it before, but establishing a strong bond with people in your community-right now-is vital to every sort of emergency preparedness. In event of a Level One or Two emergency, these are the folks who could come to your house to make sure you're okay. They might give you a ride out or a place to sleep if you accidentally end up in a "hot zone" of riot or protest. In a deeper or more long-term emergency, they could pool resources with you to make supply runs. They can advise you if they've spotted a roadblock. They might let you cross their land to avoid a route that has become dangerous.

5. If you grow crops or raise food animals and the unrest is due to a food shortage (or something has driven city people out into the countryside), prepare to protect your resources day and night. Here again neighbors can do each other valuable services, like taking shifts guarding fields, barns, private roads, and gardens. Yes, this is an apocalyptic scenario. Not a likely one. But if it happens, it's a Level Three or Level Four emergency-delivered to your own front yard.

6. Get advance word on local conditions when traveling. We're used to hopping into our vehicles or onto airplanes and going wherever we want to go. But as the worldwide economy deteriorates, it's wise to keep an eye on our destination. Right now, this warning pertains more to overseas travel than jaunts within the U.S. If you plan to go abroad, visit online sites like Travelfish.org. They'll have bulletins about adverse conditions in areas you plan to visit; you may even be able to receive alerts via email that will warn you about anything from political protests to disease outbreaks in places you plan to go.

7. Watch for signs of trouble when in an unfamiliar area. Sometimes the only advance notice you get is the notice your own senses give you. When walking, driving, biking, or otherwise traveling in unfamiliar places, stay in what gunfolk call "condition yellow." This is different than the meaningless colored threat levels the Department of Homeland Security puts out. It just means "be alert!" Never simply allow yourself to slouch along obliviously. Always be aware of who's nearby and what's going on around you. If you spot trouble developing, turn. Avoid it if at all possible.

8. If you stumble into a "hot zone" of unrest, be prepared to think on your feet. Not many people are qualified to give you advice about how to behave if you unavoidably find yourself in the midst of trouble-a riot, a mass protest that suddenly engulfs your familiar downtown, a spot where police are bashing heads or hurling tear gas seemingly at random. That's because not many people have ever been there and every catastrophe is different. If street-level chaos surrounds you, do your best to keep a cool head, move away from the worst of it if you get the chance, and get inside if possible.

9. If you're swept up in mass arrests during a riot or demonstration, the officers probably aren't going to be listening to your protestations of being an innocent bystander. You'll only tick them off and possibly get a charge of resisting arrest. The best advice I've received from my friends who've been busted during out-of-hand protests: Go along as best you can. Usually, all charges in such cases are either dropped or reduced once calm is restored. Only if we've reached the extreme point where police are rounding people up and throwing them into detention camps or "disappearing" them is fighting cops on the street likely to be worth it; then...fight like a demon.

10. Have a good lawyer and carry his or her card with you. Once again, in the heat of chaos it may not do you much good. But that card will come in handy later. Besides, if you and a police officer have an encounter in calmer circumstances, a lawyer's card, along with your calm assertion of your legal rights, will help you to be taken seriously. Police officers are like anybody else; they're more likely to go after easy targets than ones who are obviously knowledgeable and prepared. My lawyer has a helpful little list on the back of his card of the things you should do-nor not do when accosted by a police officer. I'd trust that more than my own nerves in a tight situation.

11. Be careful of roadblocks. This is a hard one. If we reach Level Three or Four of unrest, we may not only see the obnoxious police "checkpoints" we're burdened with today. We might also see two other things. One would be expanded police roadblocks, with warrantless searches, harsh questioning, and possibly mass arrests. Another could be "freelance" roadblocks-roadblocks set up by anybody from political protesters to highwaymen. (Just as gangs of home invaders now masquerade as SWAT teams, highwaymen might masquerade as government officials to rob the unwary.) If it's humanly possible, avoid roadblocks. It's not illegal to turn away from them, as long as you don't disobey any traffic laws. Police do consider it suspicious behavior and may come after you, even if you've done nothing wrong; but in a time of civil unrest, avoiding a roadblock could save your skin. Of course, both police and freelancers will set up their blockades to make them as hard as possible to avoid-all the more reason to be alert, know where roadblocks are likely to be, and have a mental map of alternate routes. If, in a time and place of unrest, you're in a line approaching a roadblock, watch what happens to the people ahead of you. If you see any sign that the motorists ahead are being abused, get out of there.

So far, we've talked mostly as if civil unrest is something apart from us-something we might have to be wary of, something we might stumble accidentally into. But the fact is that as our country becomes less free, we might of course be the civil unrest. We might resist having our premises tagged for NAIS or having our herds slaughtered for real or bogus health reasons. We might end up fighting evictions (as farmers and many rural dwellers have for centuries during hard times). We might be the ones who say, "Hell no, we won't go!" when the mobile vaccination van comes to town, or the ones who try to keep our neighbors from being rounded up and sent to camps. Times are uncertain. We simply don't know. But in every case, preparedness, foreknowledge, and a cool head will come in handy.

Some of us already have lines in the sand that would inspire us to resist abuses of authority. And that, right there, is something our would-be masters fear-our disobedience. What will happen? And when? Nobody has a crystal ball. But the combination of public frustration and governmental apprehension is an explosive one. Someday, somebody will light the match."
- Claire Wolfe, http://rense.com/general86/prepar.htm

"True Unemployment Rate Already 20%"

"Really, how hard is it to find a job? Was June's horrid numbers, in which 467,000 people lost their jobs compared to 345,000 in May, a one-time fluke? Or does it mean that all those Wall Street economists who believe the economic recovery is starting are dead wrong?

Not to scare you, but the situation is actually worse than it seems. Over the years, the government has changed the way it counts the unemployed. An example of this is the criticized Birth-Death Model which was added in 2000. The model is designed to account for the birth and death of businesses and the resultant lag in survey data. Unfortunately, the model doesn't work that well during economic contractions (like we have now) and consistently overstates the number of jobs being created each month.

John Williams of Shadow Government Statistics specializes in removing these questionable tweaks to the government's statistical data to better align current numbers with the methodology used to gather historical data. After reviewing the data, Williams believes that "the June jobs loss likely exceeded 700,000." David Rosenberg of Gluskin Sheff notes that the fall in the number of hours worked in June (to a record low of 33 per week) is equivalent to a loss of more than 800,000 jobs.
There are similar issues with the way the unemployment rate is measured. The headline rate only jumped from 9.4% to 9.5% because of a drop in the number of people in the workforce. The more inclusive "U-6" measure of unemployment, which includes discouraged workers, jumped from 16.4% to 16.5%. But even this doesn't adequately capture the situation on the ground: Back in the Clinton Administration, the definition of discouraged worker was changed to only include those that had given up looking for work because there were no jobs to be had within the last year.

By adding these folks back in, William's SGS-Alternate Unemployment Measure rose to a jaw-dropping 20.6%. Separately, the Center for Labor Market Studies in Boston puts U.S. unemployment at 18.2%. Any way you cut the numbers, the situation is very bad. According to David Rosenberg, one-in-three among the unemployed have been looking for a job for more than six months and still can't find one.

This brings us to another issue: expiring unemployment benefits. Continuing unemployment claims fell 53,000 to 6.7 million last week, but Deutsche Bank's chief U.S. economist Joseph LaVorgna wonders how much of this decline is due people exhausting their standard 26-week benefit. He says: "We are concerned about what will happen when a significant share of out-of-work individuals' benefits completely expire, because this could lead consumer spending to re-weaken, hence jeopardizing a fragile recovery."

Unless the economy starts getting traction here in the third quarter, we could face a situation where people find that they have no job and no unemployment benefits. For these people, 2009 will feel an awful lot like 1932. As a result, spending cuts will be deep and dramatic."
- Anthony Mirhaydari , http://blogs.moneycentral.msn.com/topstocks/archive/2009/07/06/
true-unemployment-rate-already-at-20.aspx

http://www.shadowstats.com/

No work, no unemployment benefits?
Remember Gerald Celente's predictions of "food riots, revolution, anarchy..."

Rapamycin: "Fountain of Youth Drug?"

"A miraculous 'elixir of youth' which could extend the human life span by more than a decade is being developed by scientists. The anti-ageing pill was created from a chemical found in the soil of Easter Island - one of the most remote and mysterious places on the planet. In tests on animals, the chemical increased life expectancy by a staggering 38 per cent.

While the breakthrough sounds like something out of science fiction, scientists say the discovery is a major leap towards longer lives for everyone. The drug, rapamycin, is already used to suppress the immune systems of organ transplant patients. It is also employed in heart operations and is being tested for its anti-cancer properties. The scientists believe that the drug could be developed within a decade.

Dr Arlan Richardson, who led the research at the University of Texas, said: 'I never thought we would find an anti -ageing pill for people in my lifetime. However, rapamycin shows a great deal of promise to do just that.' An anti-ageing pill is a Holy Grail for medical research and its development would have major repercussions for society.

In a world where people routinely live to 90 and 100, retirement ages would need to creep forward into the 70s while extended life spans would put enormous pressures on healthcare, housing and social services - as well as marriages. The implications of a such a pill also depends on the quality of those extra years. If an ageing drug delays every aspect of getting old, then users could enjoy 100 years of good health. But if it simply postpones death, they could find their last few decades blighted by failing eyesight, hearing loss, frailty and dementia.

Rapamycin was discovered in the 1970s during a worldwide search for new antibiotics. The chemical is produced by a microbe that lives in the Easter Island soil. In its current form, the drug is too dangerous to hand out as an anti-ageing pill. The compound suppresses the immune system and makes patients vulnerable to any viruses and bacteria. The existing version of the drug also increases the risk of cancer and would need to be modified before using in human trials. However, researchers believe the new discovery will lead them to similar - but less harmful - anti-therapies.

In the study, reported today in the journal Nature, scientists tested rapamycin on nearly 2,000 laboratory mice aged around 600 days - roughly the equivalent to a 60-year-old person. Around a quarter of the mice were given a normal diet, the others the Easter Island chemical. The drug increased the maximum life span of the mice from 1,094 days to 1,245 days for females, and from 1,078 to 1,179 days for males. From the point the mice began the treatment, the drug extended the females' life expectancy by 38 per cent, and males by 28 per cent. Overall it expanded their life span by 9 to 14 per cent.

What amazed the scientists is that the drug worked even though the mice started to be given it only in middle and old age. Until now, scientists have developed just two ways of extending the life span of mammals. One is to tinker with their genes, the other to restrict their diet. Repeated studies have shown that cutting calories can make animals and people live longer. Experts believe that rapamycin - which acts on a protein in cells called TOR - might fool the body into thinking that calories are being restricted. British scientists described the findings as exciting - but stressed that rapamycin weakens the immune system, exposing patients to potentially dangerous diseases.

In its current form, an extended life span would come at the cost of having to live in a germ-free tent. Researchers want to find another more subtle drug target that extends life, but which does not damage the immune system. Dr Lynne Cox, researcher in ageing at Oxford University, said: 'In no way should anyone consider using this particular drug to try to extend their own life span as rapamycin suppresses immunity. While the lab mice were protected from infection, that's simply impossible in the human population. 'What the study does is to highlight an important molecular pathway that new, more specific drugs might be designed to work on. 'Whether it's a sensible thing to try to increase life span this way is another matter: Perhaps increasing health span rather than overall life span might be a better goal.'"