It looks to be a rocky start to the new week in the world financial markets. Major stock indexes in Europe plunged between 2.42% and 4.57% in trading there. What is the big driver of this new sell off? The renewed fear of a Greek debt default and all that would mean for European banks that have large amounts of Greek bonds on their balance sheets.
The slowly dawning realization that no amount of austerity is going to allow the Greek government to cover its financial commitments and a growing reluctance by the German government to even try is putting a fairly panicked patina on the world markets.
It is not like this is really that unexpected. The problem is that as the Greek government has slashed spending and wages and hours, their economy has slowed down. The unemployment rate in Greece has is nearly 16% and that only counts those who are looking for work, not so-called discouraged workers.
With that level of unemployment any cuts in demand just wind up as more unemployed workers who can’t afford to spend very much. This means there is less tax collected, less production needed and more people are likely to be laid off.
The next logical step for Greece is to default on its debt. This could be good for Greece in the long run, but in the short run it is likely to make the Euro Zone a really unhappy place. The index that lost the most value today was the French CAC. This is because Frances three largest banks are major holders of Greek debt. All three are expected to be down graded by credit rating agencies some time this week for this very reason.
If this seems familiar it is because it is very similar to the way that our own housing bubble collapse played out. Risky debt began to become a liability and the amount of it in the hands of US and other nations banks threatened to rob them of the liquidity they needed and make it nearly impossible for them to borrow money short term.
That it is happening to the second strongest economy in the Euro Zone is making a lot of investors nervous, and with good reason. The Washington Post quoted the German Finance Minister as saying:
“To stabilize the euro, we must not take anything off the table in the short run,” Roesler told Germany’s Die Welt newspaper. “That includes as a worst-case scenario an orderly default for Greece if the necessary instruments for it are available.”
Tonight’s Water Cooler is a follow up to the August 25th on about the launch failure of the Russian Soyuz-U variant.
As you know, with the end of the Space Shuttle program the Russians are the only nation that has the heavy lift capability to go to the International Space Station. In fact the United States has contracted with Russia to take astronauts and cargo to and from the ISS.
In August the cargo version of the venerable and normally very reliable Soyuz had a problem at 320 seconds into the launch phase when the third stage motors shut down, leaving the rocket capsule without enough speed to achieve orbit. It crashed in the far north of European Russia.
Today the BBC is reporting that there is good and bad news about the Soyuz program. The good news, such as it is, is that Roscosmos (the Russian space agency) says they know what the problem is. It seems that there was a blocked vent in the third stage that caused the failure.
The bad news is that they believe it is a production line problem and they can’t, at this point rule out that it the same problem has been incorporated into other third stage motors. They will have to be inspected one by one before the Soyuz fleet can be re-certified for human launch.
This leads to another big problem. The ISS will have to be abandoned. There is not getting around it. There will not be enough time to re-certify the Soyuz launch system before the safety certificates expires on the two Soyuz return capsules currently docked the ISS.
Happy Sunday Bread Heads!
It is great to be back after a two week hiatus where the packing boxes nearly got the better of me and Liz!
We when we got here to Damascus, we found that our moving truck would completely block the parking lot/road around the townhouses. Since we got here late in the day and were wrecked from driving we could not unload that night and we could not leave the truck out front. We found a very nice general store owner who let us park the truck behind her store over night. So this week’s baking is going to her.
We are going to be making Kolache. This is a braided and knotted bread from the Ukraine. As is the case with traditional breads there are a million variations. Mine is rich variant made with whole milk and egg yolks and features walnuts and dried cherries. It is a really good looking bread and lovely to eat.
This recipe makes two loaves so you’ll have one to eat and one to share. That is if you can force yourself to give it away. But enough small talk! Let’s bake!
Okay it is official, I have moved to freaking Star’s Hollow! Tonight Liz and I went down the Damascus Community Fair, which is enjoying it’s 66th year. Now, it would be easy to be cynical and snide about something like this, but that would completely miss the point.
You see I have basically been a big city guy for most of my life. My hometown in Michigan (Ypsilanti) is 28,000 and the auto factories in the area were the primary source of employment. When we had street fairs they ran to muscle car shows and art and such. There was never a pedal tracker pull for the little kids, and for sure there was not a live stock auction.
What really got me about the fair was the crafts competitions. There was baking and wood working and sewing and photography and more. The competitors were all ages and skill levels and some of the skill was high indeed. Take a look at the champion hand craft, these hand-woven baskets.
But more impressive than the winners was the amount and level of skill that seemed to pervade the competition. This is town of 11,430 people as of the last census. It is very much a small town for all that it is 45 miles from the nations capital, and yet I saw food and crafts that would easily have won the Colorado State Fair competitions.
Okay, so you may or may not know but is has been raining cats and dogs on the East Coast all week. It is so bad I stepped in a poodle today (be careful with that joke, its an antique!). Coming from somewhere where the sun shines 300 days a year to this has been really hard, even if it is not normal.
So ,what do you do when you are down and you want to get up? You listen to blues of course. So here are three songs to get your blues turned upside down.
We kick it off with BB King kickin’ it in a blues guitar solo:
Next up the rockin’ Chuck Berry from a 1979 BBC special showing that he knows the blues:
And we’ll wrap it up with Eric Clapton and the Groaning Blues!
Now I can’t say exactly why listening to others sing about their troubles lifts you up, but I can say that if you listen to all three of these you will feel better about whatever ails you.
What is on your minds tonight Firedogs? The floor is yours.
At what point does being respectful of those who volunteer to wear the uniform of our nation become a fetishization of the military are a whole? For me a clear warning sign is when we start to see products like the ones in this Washington Post article.
It seems that there is money to be made by selling all things military, from Tough and Tiny backpacks (holds your child’s treasures in military style, don’t ya know) to Devil Dog the official licensed sent of the USMC.
Let’s be clear, I have a lot of respect for those who serve or have served. My Dad and all his brothers were Army vets, two of my Uncles on the other side served in Vietnam (though it should be said they were both drafted) one being pretty severely wounded there.
For all of that second hand association with the military, I don’t see the need to have military branded products to declare my respect for them or pride in their service. That might be a little different if they were active members serving overseas right now, but it still would not extend to buying cologne to smell like a Marine.
Maybe I am just being a grump about this but I think it is a dangerous thing for a society to over hype pride in the military. There is nothing wrong with giving respect to those who serve but there is something troubling to me about treating that respect as a consumer marketing opportunity.
The issue is that marketing always goes the extra mile. To some wearing a branded product like a Coca Cola tee-shirt might be just a fashion statement. But it is also a not so subtle endorsement of the product itself. When we are talking about a choice of beverage, who cares? But a nation’s military is not a brand to be pushed.
The United States spends more on its military than any other nation in the world. In fact we spend more than the next ten biggest spending countries, combined. For all of that we have been able to resist militarization of our nation as a whole, but that has been changing for a while.
If you break technology down to its most basic form, humans have only a few tricks. One that we have used to great affect for a very long time is fire. It is root of chemistry, power generation, building, the list goes on and on. The importance of fire is actually seems to be an evolutionary force that allowed early humans to transition from a chimpanzee like australopithecines to Homo Erectus and the other more recent human species.
One of the big observational differences between modern humans and our primate cousins is the amount of time that we spend chewing our food. All the other primates still kicking around the planet spend around 50% of their day chewing.
To aid in this they have developed really big rear molars allowing them to pulverize their food and get the most calories possible. But it comes at a price, they have spend more time consuming their food and that means there is less time for them to do other things.
Modern Humans, on the other hand, only spend about 5% of our time chewing, because we have mastered fire and with it cooking. This means that we can get more calories at a lower cost in time and effort in digestion for less work. That helps us support our large (compared to other primates) brains which can consume as much as ¼ of the total energy from the food we ingest
This is the theory of Dr. Richard Wrangham of Harvard University. He published a book called Catching Fire: How Cooking Made Us Human. He makes a sweeping case that early humans like Homo Erectus must have had fire and been able to cook their food, giving them the advantage in calories and time.
My parents are a great example of the American Dream. They were the first people in their families to attend college and to get post-grad degrees. They came from huge families (11 on Dad’s side, 13 on Mom’s) which guaranteed that they even with good jobs for their fathers they would be in dire economic straights.
They managed, with some help from programs like the G.I. bill and academic scholarships, to get the education they needed to go from working class to middle class. They were not alone in their achievements in the post WWII generation. The middle class blossomed and prosperity grew. Unfortunately for the kids of folks like my parents, holding on to middle class status is turning out to be nearly as hard as attaining it.
A new report from the Pew Charitable Trusts details how one third of people who grew up in a middle class household have now become ‘downwardly mobile’. For the purposes of the study the group from Pew defined the middle class as being between the 30th and 70th percentile in income.
The study sample was based on people who were between 14 and 17 in 1979 and lived in their parents house, in the income brackets described above. The study then looked at their income status between 2004 and 2006 and compared the numbers to the numbers in their parents generation.
Note that this was before our economic catastrophe and its ongoing affects. 1 in 3 of these children of the middle class had slipped below the 30th percentile in income. The study finds that the problems of those who did slip out the middle class were what you might expect. A lack of higher education is a strong signal, women who are divorced and, of course the numbers are much higher for minorities than for white citizens.
One of the big finding is the marriage makes a big difference in maintaining middle class status. This is hardly surprising since nearly every family these days is a two income family and losing that other income or never having it makes staying in the income bands twice as hard
This video is an exaggeration, of course. Still having spent three years behind the headset on the a Customer/Internal Customer help desk I have to admit it seems that this was the job day in and day out.
So what is on your minds tonight Firedogs? The floor is yours
So it is the day after Labor Day and what are the Republicans doing as they return to Washington? Why trying to prevent the National Labor Relations Board from creating a new rule that would make it easier and faster to hold a vote on forming a union, of course.
The Hill is reporting this morning that Republican lawmakers want to block a newly proposed rule which would take away a few of the barriers that are currently used by business to slow and stymie the process of even getting to a vote on the formation of a union.
The issue here is not whether a group of workers can form a union but how they go about getting to the vote to see if they have enough support for such a move or not. The new rules would allow for the electronic filing of petitions, would force management at the company in question to provide a list of all the workers who will be voting, including their home phone numbers and e-mail addresses, and would move the appeals process from pre-vote to post-vote.
Now, in the interest of full disclosure, I am the grandson and nephew of Union members, I grew up in Michigan in a UAW extended family and am the son of a Labor Law attorney, so I am going to be pro-labor. All that said I am having a hard time finding what is so objectionable about these changes.
One supposes that it is because preventing months or years of delay by companies as they produce more and more black propaganda and pressure against the idea of collective bargaining will make it more likely that workers will see the benefits of banding together. But that is not how it is being framed by the Chamber of Commerce and Republicans.
The often clueless House Majority Leader, Eric Cantor, has sent around a memo including this change as part of ‘the 10 most harmful regulations proposed by the Obama administration’.