Doug’s Dynamic Drivel

[tag]Jim Kunstler[/tag] has a very succinct article today on the destruction of the [tag]US economy[/tag] in his [tag]Forecast for 2008[/tag] post. Here are a few choice quotes but do go read the whole thing. If you’re not mad and not scared you really should be.

The inertia holding everything together that I described in last year’s forecast finally melted away at mid-summer and events began spooling out of control. Specifically, the massive tonnage of debt-backed securities circulating through the financial sector stood revealed for the mostly worthless bales of paper they truly are, and the investment community was left suspended in mid-air, grinning unconvincingly, like Wile E. Coyote thirteen yards beyond the edge of the mesa, with a sputtering grenade in each hand and an anvil tied to his ankles.

…something like 40 percent of all new jobs after the year 2000 were created in the final burst of suburban expansion — everything from the excavators to the framers to the sheet-rockers, and then the providers of granite countertops, the sellers of appliances and furnishings, and cars to service the far-out new subdivisions, and so on. This is the end, therefore, not only of the production “home-builders,” but perhaps everything from Crate and Barrel to WalMart, too, eventually.

By the way, the housing collapse was only one phase of a more generalized real estate debacle, because the commercial side of the business has also begun a nauseating slide into non-performance and equity destruction. In other words, we built way too many strip malls, power centers, and office parks. God knows what will happen to the owners of these white elephants, or the mortgage and lien holders of these things — but as one wag remarked to me some years ago as we both gazed upon a forlorn abandoned strip mall outside of Tulsa, “…we don’t need that many

And on a topic near and dear to my heart as regular readers will know - [tag]natural resource nationalism[/tag]

The second new factor on the [tag]Peak oil[/tag] scene is “[tag]oil nationalism[/tag].” It is prompting countries like Norway and Russia to husband more of their own resources as the awareness hits that they are past peak and might want to keep their own motors humming further into the future. Oil surplus nations are also trending more toward selling their oil on the basis of long-term contracts with favored customers rather than just auctioning the stuff off on the futures market. This makes oil a much more important element in geopolitical power politics. Note that the US may not enjoy “favored customer” standing among many of these nations.

In the immortal words of Paddy Chayefsky’s [tag]Howard Beale[/tag], words that are just as applicable today as they were in 1976

I don’t have to tell you things are bad. Everybody knows things are bad. It’s a [tag]depression[/tag]. Everybody’s out of work or scared of losing their job. The dollar buys a nickel’s work, banks are going bust, shopkeepers keep a gun under the counter. Punks are running wild in the street and there’s nobody anywhere who seems to know what to do, and there’s no end to it. We know the air is unfit to breathe and our food is unfit to eat, and we sit watching our TV’s while some local newscaster tells us that today we had fifteen homicides and sixty-three violent crimes, as if that’s the way it’s supposed to be. We know things are bad - worse than bad. They’re crazy. It’s like everything everywhere is going crazy, so we don’t go out anymore. We sit in the house, and slowly the world we are living in is getting smaller, and all we say is, ‘Please, at least leave us alone in our living rooms. Let me have my toaster and my TV and my steel-belted radials and I won’t say anything. Just leave us alone.’ Well, I’m not gonna leave you alone. I want you to get mad! I don’t want you to protest. I don’t want you to riot - I don’t want you to write to your congressman because I wouldn’t know what to tell you to write. I don’t know what to do about the depression and the inflation and the Russians and the crime in the street. All I know is that first you’ve got to get mad. [shouting] You’ve got to say, ‘I’m a HUMAN BEING, Goddamnit! My life has VALUE!’ So I want you to get up now. I want all of you to get up out of your chairs. I want you to get up right now and go to the window. Open it, and stick your head out, and yell, [shouting] ‘I’M AS MAD AS HELL, AND I’M NOT GOING TO TAKE THIS ANYMORE!‘ I want you to get up right now, sit up, go to your windows, open them and stick your head out and yell - ‘I’m as mad as hell and I’m not going to take this anymore!’ Things have got to change. But first, you’ve gotta get mad!… You’ve got to say, ‘I’m as mad as hell, and I’m not going to take this anymore!’ Then we’ll figure out what to do about the depression and the inflation and the oil crisis. But first get up out of your chairs, open the window, stick your head out, and yell, and say it: [screaming at the top of his lungs] “I’M AS MAD AS HELL, AND I’M NOT GOING TO TAKE THIS ANYMORE!”

[tags]capitalism, market forces, free market, housing bubble, construction, employment, mortgage, foreclosure, sub prime meltdown, banking criminals [/tags]

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