Barrel Strength

Can anyone spot the problem with that headline?

Update (by Glendronach)

A sampling of reactions via Instapundit.

Few remember that the current US housing crisis began in 1990s in an identical manner. Looks like Obama is going for an encore.

In what could be a repeat of the easy-lending cycle that led to the housing crisis, the Justice Department has asked several banks to relax their mortgage underwriting standards and approve loans for minorities with poor credit as part of a new crackdown on alleged discrimination, according to court documents reviewed by IBD.

Prosecutions have already generated more than $20 million in loan set-asides and other subsidies from banks that have settled out of court rather than battle the federal government and risk being branded racist. An additional 60 banks are under investigation, a DOJ spokeswoman says.

We have all heard for Chicago school of economics and now we are fortunate enough for Obama to show us the Chicago school of politics. The latest example is as follows.

With Democrats’ poll numbers in the dumps, President Obama has decided to release some of the U.S. strategic petroleum reserves to cut prices at the pump. Problem is, its only real “strategic” purpose is politics.

The White House announced Thursday that for only the third time in history, the U.S. would release 30 million barrels of oil from the national stockpile….

The spigots have been opened just twice — in 2005 by President Bush, who released 11 million barrels after disruptions from Hurricane Katrina, and in 1992 by President Bush Sr., who tapped 20 million barrels in the wake of the Gulf War. President Obama’s release — which is far bigger than either of those two emergencies — is supposedly in response to disruptions from Libya, which isn’t even a U.S. supplier. It isn’t our crisis.

Instead, Obama has said this release is part of a “coordinated” effort by the International Energy Agency to lower world oil prices and “save” the global economy.

It’s more than that, given that the IEA’s 60 million barrel release amounts to twice Libya’s daily lost output. This looks a lot more like a blatant effort to manipulate oil prices globally, using U.S. resources.

Some quick calculations of the amount released:  IEA 60 million barrels, US 30 million barrels, Europe 18 million barrels and Asia 12 million barrels for a total of 120 million barrels. The world oil consumption is 89 million barrels per day so this 120 million barrels will last less than 1.5 days.

This will be the political battle to watch as the deficit model confronts reality.

But public workers have a unique relationship with elected officials, because government employees are effectively negotiating with bosses whom they can campaign to vote out of office if they don’t get what they want. Private unions, in contrast, don’t usually have the power to fire their members’ employers.

Even in recent years, as economic troubles have worsened, benefits for some government workers have grown. In 2008, for instance, lifeguards in Laguna Beach started receiving increased retirement benefits as the state’s economy began to slow. The next year, the town’s chief lifeguard retired at age 57, with a $113,000-a-year pension after 36 years on the job.

For everybody else insider trading is the quickest path to a “perp walk” but for the ruling class it is the path to riches and nothing has changed in the last 7 years.

In a 2004 study, the same professors found that U.S. senators also enjoy a “substantial information advantage” over the average investor — and even corporate bigwigs — when it comes to picking stocks. The latest study shows that members of the Senate outperform their House colleagues by an average of 30 points per month.

A new study released yesterday confirms the trend.

An extensive study released Wednesday in the journal Business and Politics found that the investments of members of the House of Representatives outperformed those of the average investor by 55 basis points per month, or 6 percent annually, suggesting that lawmakers are taking advantage of inside information to fatten their stock portfolios.

“We find strong evidence that members of the House have some type of non-public information which they use for personal gain,” according to four academics who authored the study, “Abnormal Returns From the Common Stock Investments of Members of the U.S. House of Representatives.”

The upper reaches of the private industry are not immune from this sort of behaviour. Note the latest from the US Fed.

Credit Suisse Group AG, Goldman Sachs Group Inc. and Royal Bank of Scotland Group Plc each borrowed at least $30 billion in 2008 from a Federal Reserve emergency lending program whose details weren’t revealed to shareholders, members of Congress or the public…..

They paid interest rates as low as 0.01 percent that December, when the Fed’s main lending facility charged 0.5 percent.

“This was a pure subsidy,” said Robert A. Eisenbeis, former head of research at the Federal Reserve Bank of Atlanta and now chief monetary economist at Sarasota, Florida-based Cumberland Advisors Inc. “The Fed hasn’t been forthcoming with disclosures overall. Why should this be any different?”

Who knows what other programs were implemented by the Fed to lubricate the government-industrial complex.

Ah! The power of the market! How we love to wander the shops picking out the amazing products from all over the world, laid out in attractive abundance! How efficient are thy ways, O market! As we have learned at the feet of the great Friedrich Hayek, the market conveys information by means of prices, and prices summon forth this abundance from the tea plantations of Assam and the chip fabs of Malaysia to our malls.

And we all know of places where they are still running the socialist experiment:Cuba, Syria, North Korea, and we do not want to copy their example.

So it will come as some surprise to you that we have not quite reached market nirvana in telecommunications in Canada yet, nor anywhere else in the world, for that matter.

Because the truth of the matter is this: if you had to design a communications system from the ground up, you would never build two separate wire-based systems if you had the choice. You would build one, and let everyone use it on non-discriminatory terms, set out by law and regulation. We do not have two non-interconnecting road systems, do we? You take the blue road and I’ll take the yellow road and we will see who is Toronto afore ye?

Of course not. We have two separate systems of wired communication because, before the invention of the Internet protocol, systems were adapted by analog technology to serve one purpose only: two-way telephony and one-way broadcast distribution. Our communications systems were built out under radically different assumptions of what they would or could do. Internet protocol made it possible to develop general-purpose networks that could do a variety of things. But the legal apparatus, based in ideas of railroads, switching, boxcars, and sidings, carried with the idea that the owner of the network decides what gets on his tracks. It also gave him great power over transport to integrate his business upward, to use his market power to take over grain storage and milling, for example.

These two kinds of power were thought to need regulation in the 19th century, and telecommunications regulation grew out of those legal models.

You have to be extremely conscious of what metaphor you pick when you envision a legal scheme for communications networks. If you envision “railway” – they had no other model in 1890 – you naturally assume that the right of the track owner to determine what goes in his boxcars is his business alone, and who may interconnect with his track is his business to decide. But the inefficiencies and unfairness of this arrangement led Parliament to legislate some controls over the power of owners to block traffic from other systems

And for that matter, we do not allow the people who own our roads determine what kind of cars will drive on them, beyond very general rules of construction and safety? I mean, we own the roads as taxpayers, right?

Even the corporation that owns the private toll road north of Toronto cannot deny you service because you drive a Ford, or becasue you do not drive a Ford.

Yet when we come to telecommunications (telephone and cable systems), some free-marketers lose all perspective. The foremost example of this loss of perspective is the view propagated from the Montreal Economic Institute. It never seems to lack for space in the Op ed pages of the Financial Post, since Terrence Corcoran favours their views.

The MEI sees regulation of terms of access to networks as “state economic planning.”  Martin Masse and Paul Beaudry write:

Independent ISPs survive and are able to offer unlimited plans only because they are given a privileged access to somebody else’s infrastructure

Let us consider what happens when you drive your car off your parking ramp and into the street. You as a driver  are licensed by the state. Your car is licensed by the state, part of which includes a safety check. You are legally liable for accidents. You are subject to police supervision of a rather close kind. You are subjected to heavy taxes on fuel. But you are not subjected to editorials from the Montreal Economic Institute denigrating your “right” -actually licence - to drive on a public highway as a dreadful example of state planning and incipient socialist tyranny. Why?

The answer is that we have figured out the appropriate relation of citizens to roads. By and large, they are there for us to use, however much that use is carefully licenced and taxed.

When we come to telecommunications networks, by contrast, we have not yet agreed upon the appropriate legal relationship of user to network owner. The MEI talks of networks as a kind of private property, wholly divorced from the purpose for which we have networks, which is to allow you and I to communicate. The economists hired by carriers fulminate against tinkering with networks by innovators, and allowing leased bulk access to transport facilities, as defenders of slavery fulminated against aggression towards private property by those god-damn abolitionists. We still treat seriously the notion that traffic across communications networks, things whose substrate is speech (whether spoken, visual, or any form of signification),is transported by the grace and favour of carriers, at their absolute discretion, as if we had no more rights than trespassers in a back yard.

Communications networks exist for us and our purposes. Network owners deserve profits, and we gladly supply them so that they can improve and build more capacity and functionality into their systems. But they are in business for us, and not otherwise.

The MEI people and my readership could profitably turn their attention to Tim Wu’s The Master Switch.

It is also worth noting that, in relation to the issue between the large carriers and the smaller ISPs over pricing, Bell Canada has signalled it is ready to agree with the smaller ISPs.

Nevertheless, the bad policy ideas emanating from the Montreal Economic Institute – on this issue alone – need to be skewered.

Some authors make you change how you think about something highly important, such as Darwin on the subject of evolution. Some, like Adam Smith or David Hume, make you change how you think about human nature, and consequently their manner of thinking seeps into all departments of your mind. Nicholas Taleb makes you change how you think about what you know, and thus makes you change your mind more fundamentally than all of them.

You have probably heard of “The Black Swan”, a book by a Lebanese-born New York market trader and philosopher of knowledge named Nassim Nicholas Taleb. Maybe you have not had time to read him yet. Let me help you to make the decision to do so.

A black swan, in Taleb’s definition, is an event which has three characteristics:

• it is an outlier, “as it lies outside the realm of regular expectations, because nothing in the past can convincingly point to its possibility.”
• it carries extreme impact;
• despite its outlier status, human nature makes us concoct explanations for its occurrence after the fact, making it explainable and predictable.

Taleb, who is an Orthodox Christian from Lebanon’s elite, is at war with a vast category of higher-order fools, particularly in the area of finance. They are higher-order fools because they are measuring risk by means of intellectual tools that, by their very operation, rule out black swans.

Think of the most dramatic recent example: the attacks on the twin towers on September 11, 2001. I think most of you who witnessed it would have felt like me: this isn’t happening, this can’t be happening, O Lord, we are in a science-fiction universe! (It also illustrates that a black swan to the rest of us is not a black swan to the people who planned it).

Taleb is NOT saying that better predictive abilities will rule out black swans. He is arguing that, in a world far more affected by black swans than we care to believe, it is imperative that our mental tools accommodate their reality. And this, he says, is precisely what business schools and most statistical methods taught in universities fail to do.

The world, he says, is divided into events that come from Mediocristan, and those that come from Extremistan. In Mediocristan, the domain of the Gaussian bell curve of probability, outliers can have very little impact on the statistical norm. Put a hundred people in a line-up and weigh them. Measure their height. Measure their life-spans. Average height, weight and life-span will not depart significantly, that is to say, by orders of magnitude, from some average, even if you compare lard-asses to Laotian hill people, or smokers to alpine hill-dwellers. Even if you compare the average intelligence of 100 people to the average intelligence of Nobel-prize winners.

Then take wealth. Put Bill Gates in a line-up with 100 other people. The combined wealth of the other 99 will hardly be more than Bill Gates’ interest income in a day. Wealth distribution partakes of Extremistan. So does most of the forces and things that make the world as it is.

Taleb is not talking about the kind of risk that occurs inside casinos (the ludic fallacy, he calls it). Nothing that happens inside of a casino partakes of Black Swan-ness, else casinos would go broke as often as Lehman Brothers, Barings, and Wall Street crashes.

Nothing that you know will be the source of a Black Swan. Take for example, the elm tree that hovered over my country house. It started to die, so that progressively larger branches were falling off it. I had it cut down, to avoid the disaster of a 150-year old elm crushing my house. No Black Swan there. The course of events was foreseen and prevented. Most of what you insure against partakes of Mediocristan. Indeed, excluding risks coming from Extremistan is precisely what insurers try to do.

The essence of the Black Swan is that no recurrence of events, no matter for how long, rules out the catastrophe.  Put a few dots in a line.  Put as many dots as you like and make a projection through their mean.  If the dots derive from data subject to the rules of Mediocristan, you may have a valid trend. But if the dots derive from data obeying the mathematics of Extremistan, no matter for how long the data is derived, the trend line is just so much bullshit and self-deception. If a turkey lives a thousand days, it has every reason to believe its kindly feeder will feed it on day 1001. But on day thousand and one, it is killed. For the turkey (but not for us), its slaughter is an event from Extremistan.

Or as he says, you cannot foresee the event, but you can make yourself more robust against the consequences of unforeseen events. Society can stop putting blind people in charge of driving school buses.

Taleb frustrates those who want easy answers because his book asserts that the unpredictable lies in a domain of ignorance so deep that it cannot be computed, ever. It lies beyond the bell curves of Gauss, or even the mathematics of his friend, the late, the regretted Benoit Mandelbrot, whose mathematics inform us that Grey Swans are possible. (Mandelbrot has also written that the stock market obeys rules of risk that are far from those of the bell curve).

He writes:

“I am going to be blunt. Before The Black Swan (and associated papers) most of the epistemology and decision theory was, to an actor in the real world, just sterile mind games and foreplay. Almost all the history of thought is about what we know,or think we know. The Black Swan is the very first attempt (that I know of) in the history of thought to provide a map of where we get hurt by what we don’t know, to set systematic limits to the fragility of knowledge – and to provide exact locations where these maps no longer work.”

I have not conveyed the pleasure of reading Taleb. He is deeply and vastly well-read. He cites thinkers I had never heard of, as well as plenty that I have. He demolishes the reputations of learned fools with elegance and total intellectual clarity. His attacks on economists and finance professors for their systemic blindness to Black Swan phenomena are fierce, joyous, merciless.

“Research shows that academics are overrepresented in the systematizing, Black-Swan-blind category….I haven’t seen any formal direct test of Black Swan foolishness and the systematizing mind, except for a calculation George Martin and I made in 1998, in which we found evidence that all the finance and quantitative economics professors from major universities whom we tracked and who got involved in hedge fund trading ended up making bets against Black Swans, exposing themselves to blow-ups. The best-known such academics were, once again, the “Nobel”-crowned Myron Scholes and Robert C. Merton, whom God created so that I could illustrate my point about Black Swan blindness”.

“Normally, such people exit the gene pool; academic tenure holds them a bit longer.”

Most of all, he confirms you in the conviction that we are living in a Black Swan universe. Why does the stock market crash every eight or ten years on average, rather than the 780  odd years predicted by Gaussian bell curve distributions? Why do small bands of outliers create world-shaking religions? Seize states and plunge us into world wars? Invent devices that destroy previous industrial empires?

Taleb is the foe of the tidy-minded. He is the enemy of hubris. Reading his book will change how you think. It will compactify everything you know into a small quadrant, everything you might know into another, and keep your mind open to the need to fortify yourself against the consequences of things going badly wrong. A large amount of  debt , for example, is not a Black Swan except to the turkeys who hold it.

Ages ago, in another universe, I read a beautiful illustration of what Taleb was talking about in, of all places, Carlos Castaneda. You may recall from your distant hippie past that Carlos Castaneda claimed to have been under the personal tutelage of a Mexican Indian shaman, who was called Don Juan Matus. Castaneda’s teachings are to Don Juan as Plato was to Socrates; he writes as the foolish scribe who never understood what the Master was talking about. 

Don Juan insisted upon the division of the world into the tonal, and the nagual, which we would pronounce “nahual”. The tonal is the domain of the known and the knowable, and the nagual, the unknowable. One day, stirred by his students’ incessant questioning on this point, Don Juan organizes his apprentices to go on a picnic. They gather everything for this journey: plates, cutlery, baskets, even chairs and table. They drive for hours and then begin a hike up into the beautiful arid mountains of the Sierra Nevada, through the chapparal. They climb for hours and eventually find themselves on a flat look-out facing another, equally beautiful range of parallel mountains many miles away across the plain. The range is lit by the rosy afternoon glow of the sun. The view is magnificent: the space, the sky, the silence, the distant eagles, the clouds beginning to be lit from underneath by the setting sun. The table is set, as if it were at a banquet, knives forks and spoons in order, the tablecloth below, the chairs arranged. The scene is perfect in every way.

Then Don Juan says: “You have asked me about the tonal and the nagual: the known, the unknown and the unknowable. This, he says, pointing to the nicely arranged table, is the tonal, the domain of the known. And underneath the table is also the tonal, the domain of the unknown. And this, he says, with a gesture embracing all that surrounds them, the sky, mountains, the earth: this is the nagual.”

We owe to Nassim Taleb the first mathematical and philosophic discussion of the limits of the tonal , the knowable,  in the western tradition. For that we can be grateful. His book is a deeply personal  pleasure. Read it for that reason, if for no other. And do not be distracted by my likening its lesson to an anecdote in Castaneda. Taleb has produced a serious, learned, and delightful mind-changer. He dwells in the world of finance, and has brought deep learning to the problem of risk (the known unknowns) and uncertainty (the unknown unknowns). Mainly, he would say, it is the consequences of the latter which we need to fortify against, and we cannot do this until we acknowledge that this domain is powerful and ever-present.

On page 5 of the Financial Post today were four articles, every one of which was concerned with the vital issues of competitiveness, freedom of speech and innovation, and economic growth :

a) Apple Shuts Book on Sony’s i-Phone App

b) Telus accuses bell of hoarding content

c) Ban on user-based Internet fees risks telecom investment,by Terence Corcoran

d) time for businesses to step up, Bank of Canada says (text of speech here)

What is the link among them?

a) Apple wants to maintain the old AT&T model of closed endpoints, (”walled gardens”) so that the owner of the network can monetize the value of all transactions within it. Vertical integration.

b) Bell the telephone/satellite carrier wants content, supplied by CTV,  to drive users to its own proprietary content, and possibly to disadvantage the content supplied by others. Vertical intergation plus possible unjust discrimination against its duties as a common carrier.

c) Corcoran is right insofar as usage-based billing (UBB) has some theoretical justification. However, the bit caps and usage fees imposed by the carriers are entirely out of line with the costs of provision, and are seen as attempts to save the closed model of cable and telephony from the open Internet-based model of content delivery. They achieve this by making Internet-based delivery of content artificially expensive vis-a-vis cable and satellite. So count this as vertical integration (content and carriage) with definite aspects of anti-competitive pricing against competitive models.

d) The Bank of Canada is telling us to find “new, more efficient ways of organizing and executing production”, now that government has done its part to make Canada tax-competitive. If this is to be done, it will necessarily involve using the Internet more effectively. Hence the net result of usage-based billing – not in theory, but as it has been imposed by the carriers with the participation of the CRTC – is to diminish the utility and affordability of  the Internet.

The CRTC has got itself on the wrong side of this UBB issue. But an impetus for this policy approach has been the unbalanced policy directive it received from government a few years ago, which had the effect of reducing the commission’s ability to concern itself with common carriage – the public responsibilities of the carriers, and of focussing on competition as the panacea for all problems in communications markets.

It is worth considering the words of Tim Wu in his brilliant and comprehensive review of the rise and fall of information empires, The Master Switch.

“Among the great questions of our time is whether our approach to the power of information should be informed by a sense of that power’s political consequences, subject to our ingrained habit of balancing and checking any great power. Or should we follow our approach to economic power in general, in which we tolerate,  and even reward, aggrandizement? 

“While perhaps not immediately obvious, such questions are in fact at the heart of the ongoing struggle between the armies of open systems and closed, represented…in the battle between Google and Apple but manifest elsewhere as well and destined to outlast that rivalry….

“…The old television-as-toaster thinking that prevailed in the the late twentieth century is no longer feasible. To leave the economy of information, and power over this commodity, subject solely to the traditional ad hoc ways of dealing with concentrations of industrial power – in other words to anti-trust law – is dangerous.

“More subtly, there is the problem of taking an after-the-fact approach to a commodity so vital to our basic liberties: a farmeowrk that has worked well enough for oil and aluminum is ultimately unsuited to an industry whose substrate is speech.”

See Niall Ferguson on the debt crisis of the American state.

“The United States is on a completely unsustainable fiscal course with no apparent political means of self-correcting”.

Then read Mark Steyn’s paean to the anglosphere, and the decline he anticipates as a result of the debt crisis of the American state. He bases himself on what has happened to Britain. The same welfare dependency generating policies that destroyed the American black family have been tried on the entire British nation, to predictable effect.

“Permanence is the illusion of every age. But you cannot wage a sustained ideological assault on your own civilization without profound consequence. Without serious course correction, we will see the end of the Anglo-American era, and the eclipse of the powers that built the modern world. Even as America’s spendaholic government outspends not only America’s ability to pay for itself but, by some measures, the world’s; even as it follows Britain into the dank pit of transgenerational dependency, a failed education system, and unsustainable entitlements; even as it makes less and less and mortgages its future to its rivals for cheap Chinese trinkets, most Americans assume that simply because they’re American they will be insulated from the consequences.”

More Niall Ferguson:

Here, here and here.

Demented Nordic pixie Bjork invokes her cruelest weapon to oppose Canadian investment in Iceland:

Icelandic singer Bjork is forcing a Canadian energy company with a business presence in her country to “hear the music” of Icelanders opposed to foreign ownership of their country’s resources.

The eclectic musician launched a three-day karaoke marathon on Thursday in the capital of ReykjavDik as part of her campaign “to win back the country’s natural resources.”

Shai Agassi, a youngish Israeli enrepreneur, talking about the electric car, in a way I had never heard before. Clearly a brilliant guy with a powerful and compelling view.

The United States imports a billion dollars a day for oil every day. Agassi believes that the electric car must be both more convenient and more affordable than the internal combustion engine-driven car. The cost of the electric car is in the battery. The Agassi view is that the business model lies in owning the battery and selling you the miles it provides. You own the car, you do not own the gasoline. Likewise you own the electric car, but the batteries are replaceable – and frequently replaced at what are now “gas” stations. Therefore, the battery is like the gasoline: sell the energy in the battery. Take the productivity gains from the increase in the gains of battery productivity for the battery company. Let others make the cars themselves. Be the energy company, not the car company.

Agassi understands the need for the electric car to be able to pass another car at high speed. Only 2% of people have ever bought a Prius, because they pay more money and get less power. Agassi is building cars to blow past the slowpokes. The answer lies in the battery and the battery replacement infrastructure.

Hans Rosling, the Swedish demographer is bringing a new understanding to the world of where we are as a species: economically, demographically, socially. Try any one of his speeches and demonstrations on YouTube. You will never use words like “the Third World” or “the developing world” in good conscience again. Our view of the world is obsolete because, unless we have travelled broadly, we still think as we were taught back in the fifties, sixties, or seventies when we went to school, namely that terms like the “Third World” — you know, large families, short lives and poverty — actually represent a reality. Let me say it plainly: the term is a large piece of wallboard which hides reality. Peruse Mr. Rosling’s brilliant work and be changed.

One hedge fund manager is counting on it. And some of the evidence Mark Hart of  Corriente Advisors offers up is blood-curdling, to put it mildly:

Raw materials: Corriente says China has consumed just 65pc of the cement it has produced in the past five years, after exports. The country is currently outputting more steel than the next seven largest producers combined – it now has 200m tons of excess capacity, more that the EU and Japan’s total production so far this year.

Property construction: Corriente reckons there is currently an excess of 3.3bn square meters of floor space in the country – yet 200m square metres of new space is being constructed each year.

Property prices: The average price-to-rent ratio of China’s eight key cities is 39.4 times – this figure was 22.8 times in America just before its housing crisis. Corriente argues: “Lacking alternative investment options, Chinese corporates, households and government entities have invested excess liquidity in the property markets, driving home prices to unsustainable levels.” The result is that the property is out of reach for the majority of ordinary Chinese.

Banking: As with the credit crisis in the West, the banks’ exposure to the infrastructure credit bubbles isn’t obvious because the debt is held in Local Investment Companies – shell entities which borrow from Chinese banks and invest in fixed assets.

Not quite the great leap forward Thomas Friedman hopes America would do in one day.

My perusal of the blogs today and for the past few weeks is enough to generate despair, but the hope persists that people will wake up in time. That is because I am hopeful by nature, not because I know the outcome.

Non-discrimination and Islam

1. The would-be Portland bomber tries to blow up adults and children at a Christmas-tree lighting ceremony. Of thousands of reports, 75% fail to report that the bomber is a Muslim.
2. Elisabeth Sabbaditsch-Wolff is on trial in Austria for expounding the doctrines of Islam. The European Commission is about to pass a law that makes criticism of Islam effectively illegal.
3. Airport pat-downs continue to try to protect against a threat that we dare not name. Israeli airport secuity measures are criticized for “profiling” Muslims.  A counterblast points out that the article might have ignored the fact that Muslims are Israel’s chief security threat. Of course, they are our chief security threat. Robert Spencer makes this point: it is time to profile according to who causes the risk.

Economic collapse

1. You can run an immigrant society or a welfare state, but you cannot have both, as Europe is discovering. You cannot vastly expand state expenditures, collapse the birth rate and attach increasingly dysfunctional immigrants (from Muslim countries largely) to the welfare system, and still remain solvent.
2. Expect one European country to go under every six months until something more dranatic happens (Greece, Portugal, Ireland and so forth).

Given what we have been doing since World War II cannot be sustained, and give that the evidence for this is to be found in ruinous economic and demographic policies, some discussion of these ideas is in order.

What is Islam?

Is Islam:

a) a totalitarian political ideology? or

b) a mass psychosis? or

c) the religion of a raiding party of slave-drivers?

Discuss. See for instance, “The Principle of Abrogation in The Quran“. The difference between moderate and radical Islam is the speed at which world domination is to be achieved.

Every day that passes I increasingly think David Warren is both right and prescient.

Germany

German Economy Minister Rainer Bruederle said on Thursday he was concerned at U.S. efforts to stimulate growth by injecting liquidity into its struggling economy.

China

Unbridled printing of dollars is the biggest risk to the global economy, an adviser to the Chinese central bank said in comments published on Thursday, a day after the Federal Reserve unveiled a new round of monetary easing.

If that wasn’t bad enough consider this.

In the midst of debates on financial regulation and China’s currency in April, Treasury Secretary Timothy F. Geithner sat down to discuss the U.S. economy — with comedian Jon Stewart.

Geithner and Stewart, host of Comedy Central’s “The Daily Show,” held an off-the-record meeting at Stewart’s office in New York on April 2, according to Geithner’s appointments calendar, updated through August on Treasury’s website.

God Bless America indeed!