Mercury Rising 鳯女

Politics, life, and other things that matter

Archive for April 25th, 2011

Blowing up

Posted by Charles II on April 25, 2011

Alan Rappeport and Robin Harding have an interesting piece in the FT. Apparently, the chief financial officer of Pepsi is arguing that food and commodity inflation–given the fact that wages are stagnant or declining– is forcing consumers to cut back. He says that Pepsi is not passing on most of the costs to consumers… yet.

From an investment standpoint, this suggests that profits in US consumer companies are likely to decline, with an interesting paradoxical effect. In the 1970s, we had inflation, but incomes were rising about as fast, so consumption did not decline so much. Now we have inflation, but without the corresponding rise in income. The net effect will be to reduce growth, at least in areas where commodities are a major cost driver: cars, travel, clothing, construction, dining out… the list is long. Areas where commodities are not a strong input, like software and services would not experience the same cost squeeze.

I don’t think this will end well. We really do need to have rising wages and rising efficiency, so that the unit prices of commodity-intensive things can rise without causing people to forgo consumption simply because they are priced out of the market. Unions! Supertrains! Fewer wars! Stuff like that. Unfortunately, the Tea Party is not likely to allow the necessary to happen, meaning that it will happen, just later and more explosively.

Anyway, for a company exec to make the argument is better than for me to make it. The Fed and the Congress might actually listen to him.

While you’re there, don’t miss the piece by Javier Blas and Jack Farchy on how Glencore bought wheat futures, then urged the Russians to ban exports. Their profits doubled. But ::smirk:: speculation isn’t affecting prices.

Added. Comment of the Day Award goes to Robert Scheer: ” It is time to admit that we are, in practice if not surface appearance, close to the Chinese communist model of state-sponsored capitalism that sacrifices the interests of ordinary workers…” As Scheer says, that’s not because of big government, but because of government capture by corporate interests.

Posted in economy, stock market | 1 Comment »

Atlas Slugged AGAIN!

Posted by Phoenix Woman on April 25, 2011

The Ayn Rand parody that saves future generations from having to slog through her prose. Here’s a sample:

“Who is John Glatt?”

Dragnie Tagbord chuckled as the arms of the students before her shot with arrow-like directness and clean mechanical precision toward the ceiling. Among this group of third-graders, such a response–the lifting of hands and their display to the gaze of their instructor, each other, and to the distinguished woman visiting their school–was a proud and public announcement of knowledge. I know, proclaimed each raised hand. I know, with pure awareness in the consciousness of my mind, the answer to the question I have just been asked.

Their teacher, Miss
Pigg, was a short, squat woman in a shapeless, baggy garment the
color of desiccated oatmeal. Although constantly informed by
politicians and television personalities of her value to society, in
her outward, personal appearance she looked shabby and morose, as if
harboring in some unconscious recess of her intelligence the shameful
awareness of the fact that, like all those whose livelihoods involved
servicing the needs of children, she produced nothing. She pointed.
“Yes, Johnny Timmons? Do you know?”

I?” The
boy, a ten-year-old unafraid to proclaim his love of truth,
suppressed a smile tinged with amused mockery. “Yes, I know it.
John Glatt is the smartest, bravest, most rational man in society,”
he replied. “It was he who, ten years ago, recruited our nation’s
true producers—the entrepreneurs and businessmen whose vision,
courage, and energy wrests value from the mute, raw earth—and led
them into a strategic retreat from the forces of theft, cowardice,
and corruption that prevailed over men in that desperate time. It is

Dragnie whispered, “It
is to him we owe—”

“It is to him we owe
the Age of Production, which we enjoy—”

The rest of the class
joined in. “—TO THIS VERY DAY!”

A laugh escaped from
Dragnie’s lips. Exercising her free will, she re-captured it and
restricted it to solitary confinement. She had chosen to spend this
John Glatt Day touring one of the ten thousand
kindergarten-through-Grade Twelve institutions, all of them
independently owned and operated and all of them called The Glatt
School, that had replaced the hidebound and notoriously inefficient
public educational system. It would not do, she thought, to display
levity in this, or any, environment.

Wordlessly, Dragnie
turned and left the classroom. There was no need to thank the
pupils. There was no need to thank their teacher. There was no need
to wish them well. Her exit was itself a kind of lesson. Do not
ask for praise
, it said. Do not ask for acknowledgment or
good wishes or pampering. Do not ask for “please” or “thank
you” or “you’re welcome” or “Gezundheit” or any of the
other tokens of mental enslavement with which men have for centuries
sought to limit the sacred freedom of the individual ten-year-old and
draft him like a chump into the unconscious mob that men call
“society.” We have no time for nurturing. Our enemies are
massing. We need you to be strong—not only when you become adults,
but today. We need strong third-graders, and second-graders, and
first-graders. We need strong kindergarteners and nursery-schoolers
and pre-schoolers and Mom-and-Me toddlers and babies and infants. We
desperately need strong neonates, fetuses, and zygotes. For that
matter, we need strong housepets. We need strong dogs and cats. We
need strong hamsters. We need strong gerbils.


Posted in 'starving the beast', (Rich) Taxpayers League | Tagged: , , , , , | 3 Comments »

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