FM newswire, 10 Nov – links to old-fashioned journalism

Today’s broadsheet from the FM website pressroom.  There are four sections:

  1. Links to interesting news and analysis
  2. Today’s special item
  3. News about themes from posts past on the FM website (including some hot news)
  4. An interesting comment lifted from the FM website

(I)  Links to interesting news and analysis

  1. British Muslims Fear Repercussions Over Tomorrow’s Train Bombing” — Horrifying!
  2. “Governor Paterson Paints Grim Picture of N.Y. Budget Crisis“, New York Times, 8 November 2009
  3. Oil at $100 Doesn’t Compute as OPEC Output Pace Grows“, Bloomberg, 9 November 2009
  4. Afghanistan Mission Creep Watch – The Barack ‘Baines’ Obama Version“, Michael Cohen, Democracy Arsenal, 9 November 2009
  5. High and dry“, The Standard, 9 November 2009 — Macau  has only 10 days of water remaining in its reservoirs, due to the drought.

(II)  Today’s special item

Quote of the day about the Fort Hood murders:  “This is perhaps a moment to reflect on the fact that the murder of innocent people is not really made better or worse by deep inquiry into the precise nature of the crime.”, Matthew Yglesias, 8 November 2009 — Close you eyes and cry “Ya, Ya, Ya”. That also helps to obscure the obvious.

(III)  Updates from past posts

(a)  Hot news:  “Key oil figures were distorted by US pressure, says IEA whistleblower“, The Guardian, 9 November 2009 — “The world is much closer to running out of oil than official estimates admit, according to a whistleblower at the International Energy Agency who claims it has been deliberately underplaying a looming shortage for fear of triggering panic buying.”  For more information see:

(b)  A series about the costs of medical care, by Thomas Sowell, posted at Townhall.com, 3-6 November 2009 — Part I, Part II, Part III, Part IV.  For more about this issue see:

(c)  About the trashing of World Oil magazine by its senior management, more journalists who’ve forgotten the meaning of journalism (other than selling adverts), by Perry Fischer (former Editor), posted at The Petroleum Truth Report, 6 November 2009 — For more about this theme, see:

IV.  Today’s interesting comment lifted from the FM website

From Mark I’s comments #52, #54, and #66, posted at Update: why has the worst recession since the 1930’s had so little impact on the economy?, 5 October 2009.  Like most of these, a swarm from the Instapundit’s website, they display little knowledge of economics — but enormous certainty:

Hands down, the 78-82 period was an actual crisis that exceeds the one we currently face.

… One last point, though – this repeated phrase: “the worst recession since the 1930’s” pretend that one were judging economic crisis on a scale of 1 to 100. We’ll give the great depression a score of 85. This current crisis is about a 20. Put the other crisis in the system, and we’ll give the 80’s a low score of 10.

Your intellectual “brinksmanship” demands that you point out that our current crisis is the closest we have ever been to the great depression, without ANY OTHER scale. You repeatedly use the phrase, without any acknowledgement that on the spectrum, our position is FAR CLOSER to our modest recessions, than the great depression.

FM  reply:  The current downturn is the worst since the 1930’s by almost every metric.  And the gap continues to widen.  Most obviously, this recession is longer, but also…

  • employment — down aprox 5.2% from peak, greatest decline since the 1930’s (graph).
  • personal income — down almost 4% annualized, first negative since 1960.
  • personal expenditures — down over 2% annualized, first negative since 1960.
  • manufactures’ capacity utilization is 69%, a post-1930’s low.
  • industrial production at -13% YoY, a post-WWII low.
  • business earings – S&P 500 eps down-91% vs. down 74% in 1929-32.
  • trade (per Krugman: “has fallen through the floor in a way that it literally never has before, including in the Great Depression”),

Compare this downturn in GDP to the other severe “gdp recessions” since WWII:

Start……….End……Duration…Drop in GDP   (duration in months)
2005Q2.…????……….6…….…..-3.5%
1957Q2….1957Q3.…2…………-2.7%
1972Q3….1974Q1.…7…………-2.3%
1953Q4.…1954Q2.…3…….…..-2.1%
1980Q2….1981Q1.…4…………-1.7%
(source: Bureau of Economic Analysis)

Due to the large and rapid federal stimulus programs (poorly designed as they were), this recession’s drop in aggregate demand (GDP) was muted, compared to the decline in most economic factors.

In a few respects this downturn is almost as bad — or worse (e.g., foreclosures) than the 1930’s:

Afterword

Please share your comments by posting below. Per the FM site’s Comment Policy, please make them brief (250 word max), civil and relevant to this post. Or email me at fabmaximus at hotmail dot com (note the spam-protected spelling).

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14 thoughts on “FM newswire, 10 Nov – links to old-fashioned journalism

  1. Excerpt from Marine Corps Birthday: (from Warrior Culture of the U.S. Marines, Marion F. Sturkey, 2001), posted at Heritage Press.

    Like the U.S. Marine Corps itself, the annual Birthday Ball has evolved from simple origins to the polished and professional functions of today. Nonetheless, one thing remains constant, the tenth day of November! This unique holiday for warriors is a day of camaraderie, a day to honor Corps and Country. Throughout the world on 10 November, U.S. Marines celebrate the birth of their Corps — the most loyal, most feared, most revered, and most professional fighting force the world has ever known.

  2. Re: Mark Steyn
    IMHO, Mark gets carried away. The failure to control the Israeli fundamentalists has kept the Palestinian problem un-solvable. Until this is rectified, Israel will remain the target of choice for the Islamic world, for all its reasons to use Israel as bogeyman/enemy. Compound it with the invasion of Iraq and the perception of the US as a bullying leviathan, and the Wahabists and their madrassas have a growth industry.

  3. From III.A:

    Matt Simmons, a respected oil industry expert, has long questioned the decline rates and oil statistics provided by Saudi Arabia on its own fields. He has raised questions about whether peak oil is much closer than many have accepted

    First, this is one of the scarier items in a while. A lot of folks have been concerned (including you) that the global economy would jump out of the frying pan of recession into the fire of an energy shortage, but given this data it appears that the true magnitude may be closer to the worst-case scenarios.

    Regarding the quote above, you’ve long pointed out that a major source of uncertainty in peak oil forecasts is the lack of good data on Saudi Arabian production and reserves. The article isn’t too explicit on this point but the implication is that Saudi Arabia has been inflating the numbers provided to the IEA at the behest of the United States to keep prices low. Perhaps this was the back-room counteroffer to the publicly denied U.S. request for increased production? Obviously there’s a lot going on behind the scenes that is opaque to us plebes . .
    .
    .
    FM reply: Simmons’ forecasting ability is minimal. No surprise, since he’s an investment banker — not an oil expert. I lightly touched upon this here:
    * Poor peak oil research, more evidence of a serious problem with America’s vision

    For more detailed demolition of Simmons’ analytical ability see these posts from Peak Oil Debunked:
    * THE TWO TONGUES OF MATT SIMMONS, 2 March 2006
    * SIMMONS’ PREDICTIONS FLOP… PATHETICALLY, 19 March 2006
    * A TRIP DOWN MEMORY LANE WITH MATT SIMMONS, 22 October 2008
    * 100 YEARS OF NATURAL GAS , 23 June 2009
    * MATT SIMMONS: THE BUFFOONERY NEVER ENDS, 3 September 2009

    Also, nothing he predicted has true yet, from his June 2005 book “Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy”.

  4. Oh, and regarding Mark I’s comment, I don’t think he was disputing that the current recession was the worst since the Great Depression, he was claiming that this is misleading since there is a large gap between first and second place. Obviously this depends on what metrics you look at, but I believe several sets of data (including some referenced here) demonstrate that in some measures we are closer to the Great Depression than to the other modern recessions.
    .
    .
    FM reply: No, that is exactly what he was saying — but this was unclear from the excerpt I gave. Thanks for pointing this out. I’ve added another quote and links.

  5. Whenever you wanna see something REALLY scary, google “Matt Simmons.” Ooh.
    .
    .
    FM reply: Scary, like a Halloween ghost. But not real. See the previous post.

  6. In response to Mark Steyn, I have only this to say:

    Let us all give thanks and praise to Allah every day that Muslims are or at least seem to be as perfidious as he says they are. And may they so continue.

    For, by focusing on their shortcomings, we thereby avoid considering our own. And considering our own is something we do not want to do.

  7. Another point:

    A Marine reservist armed with a tire iron beat and chased a man he thought was an Arab terrorist and even called 911 to say he was detaining the man, police said.

    But the man he assaulted was actually a Greek Orthodox priest visiting from overseas who spoke limited English, police said.

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