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The Daily Digest

Thursday, November 20, 2008, 11:30 AM

This is a new feature.

It provides news snippets and links on a more frequent basis.  The plan is to try and get this up every day, but we'll see how that goes.  For now, enjoy.


 
Jobless claims jump unexpectedly to 16-year high

WASHINGTON (AP) --

New claims for unemployment benefits jumped last week to a 16-year high, the Labor Department said Thursday, providing more evidence of a rapidly weakening job market expected to get even worse next year.

The government said new applications for jobless benefits rose to a seasonally adjusted 542,000 from a downwardly revised figure of 515,000 in the previous week. That's much higher than Wall Street economists' expectations of 505,000, according to a survey by Thomson Reuters.

That is also the highest level of claims since July 1992, the department said, when the U.S. economy was coming out of a recession.

 

After Losses, Pensions Ask For a Change

Stung by outsize investment losses, some of the nation’s biggest companies are pushing Congress to roll back rules requiring them to put more money into their pension funds, just two years after President Bush signed a law meant to strengthen the pension system.

The total value of company pension funds is thought to have fallen by more than $250 billion since last winter. With cash now in short supply for companies, they are asking Congress to excuse them from having to replenish the required amounts. Data including this year’s losses will not be available until the next batch of annual reports, but Mr. Zion estimates that this same group has lost almost $265 billion since the beginning of the year.

 

Credit crunch due to lack of borrowers: Lacker

WASHINGTON (MarketWatch) -- The credit crunch is more about lack of opportunities for good loans than concern about bank capital, Richmond Federal Reserve Bank Jeffrey Lacker said Wednesday.

"My reading of current conditions is that bank lending is constrained more now by the supply of creditworthy borrowers than by the supply of bank capital," he commented.
Lacker's remarks put him at odds with the majority of the Fed's policy-makers, who have approved an unprecedented increase in lending to shore up the financial sector.

The Fed official clearly is uneasy about the central bank's massive lending campaign. "The dramatic recent expansion in Federal Reserve lending, and government support more broadly, has extended public-sector support beyond existing supervisory reach, and thus could destabilize the financial system, absent corrective action," he said.
The remedy is not to extend government oversight but to roll back the scope of the federal safety net, he added.

 

Rendell says state deficit growing, orders more budget cuts

HARRISBURG -- Get ready for tough times with the state budget, with this year's deficit potentially reaching $2 billion by June 30, Gov. Ed Rendell said today.

For the first four months of fiscal 2008-09, which began July 1, there has already been a shortfall of $565 million, as tax revenues and state investments have fallen off sharply due to the ongoing recession.

"We're expecting a shortfall of somewhere between $1 billion and $2 billion" by the end of the fiscal year June 30, he told reporters today.

And that will necessitate a second round of budget cuts for state agencies. Mr. Rendell has already told agencies under his control to set aside 4.25 percent of their 2008-09 budget because they probably won't be allowed to spend it. That will save $311 million. He has asked independent agencies, ones he doesn't directly control, to make similar cuts, which could save another $39 million.

"We will do everything we can to do as little harm as possible, but the budget cuts are coming," he warned. "I don't want to hear any whining. The cuts will be painful, People have to get ready. No one will make these cuts with any joy, but I don't want to hear any whining."

 

The Road to Financial Ruin: We Have to Spend Money Now

There are two major reasons why we may be setting ourselves up for financial ruin: first, spending is unlikely to lead to a sustainable recovery; second, we cannot afford it.

We cannot afford the massive fiscal stimuli that we are likely to see proposed in the coming months. It is one thing for China to inject $586 billion into its domestic economy as they have a budget surplus as well as enormous reserves. This money will be spent on infrastructure spending, potentially allowing the country to reposition itself in a world that will be more dependent on domestic economic activity than sales to the U.S. We estimate that the U.S. will need to finance about US$2 trillion in 2009. Who will finance this debt? There is less trade with Asia, so there will be fewer dollars to be potentially recycled into the U.S. economy. And Asia now needs its foreign currency reserves to finance its domestic spending programs. We don't think Asia will be financing the upcoming U.S. fiscal spending spree.

 

 

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15 Comments

crymoney's picture
crymoney
Status: Member (Offline)
Joined: Sep 5 2008
Posts: 18
Re: The Daily Digest

Chris Mortensen.com is the best I've found for covering thecollapse of America. Chris's conservative and straightforward nature makes iteasy to pass this information to others. What I was looking for originally andwhat has been missing so far are answers to the growing question, what to do!Suggestions for preparation have so far consisted of, save some cash aside,save some food aside, buy some gold and if possible move to a self-sustainingfarm. If any self-sustaining farm still exists this is probably the best option,but not one many can actually accomplish.

 

What I would like to hear are detailed explanations of howwe can best survive and profit from the coming financial debacle. Unfortunatelythere may not be any plausible silver bullets. As there has never been afinancial screw up like the one we are now witnessing, we can't expect Chris oranyone else to predict what will happen or how we should prepare for it.

 

Assuming that most of us are not able to retreat toShangri-La, it would be nice to detail various other plans with potential toimprove our chances. I sure don't have a single one to offer. Getting detailedup to the minute information just before the train hits us has limited value.

 

The only positive thing that I can offer at this time is togo buy a good headlight. Not the ones for your car, the ones for your head.Good ones cost about 60 to 70 bucks. Also get at least a couple sets ofrechargeable batteries, a charger and possibly even a solar charger. Why?Because these little headlights can provide you with extremely valuable lightexactly where and when you want it. They are independent from the power gridand give you high-quality light anywhere you go, while leaving both hands free.That's a pretty puny suggestion to help out and unfortunately the best I can dofor now. If there are suggestions others can offer regarding things we can doto more intelligently prepare for the coming days I certainly hope this sitewill provide a forum for such discussions.

Doug's picture
Doug
Status: Diamond Member (Online)
Joined: Oct 1 2008
Posts: 3159
Re: The Daily Digest

I think perhaps you missed the most important of the suggestions on this site, community organizing.  I think it's unlikely that most people are going to be able to comfortably get through the coming mess without the support of a community.

ajparrillo's picture
ajparrillo
Status: Bronze Member (Offline)
Joined: Sep 7 2008
Posts: 72
Re: The Daily Digest
Doug wrote:

I think perhaps you missed the most important of the suggestions on this site, community organizing.  I think it's unlikely that most people are going to be able to comfortably get through the coming mess without the support of a community.

Whoa!  Utilizing my newly developed campaign rationalization...community organizing is a joke and akin to terrorism.  How dare you suggest such radical actions! Laughing

Golden Age's picture
Golden Age
Status: Bronze Member (Offline)
Joined: Aug 2 2008
Posts: 61
Re: The Daily Digest

You understand what you should do to make the coming collapse of the dollar and the economy.  But you are asking how to make this painless for yourself and perhaps your family.  As you already stated there is no silver bullet and you are correct.

What you are really asking is, how can I avoid feeling the pain that will be hurting everyone else?  This nation has "sown the wind and will reap the whirlwind" a verse from the Old Testament.  Everyone is going to be feeling the pain.  The best any of us can do is be prepared as well as possible and adjust our standard of living down and down again. 

 

mainecooncat's picture
mainecooncat
Status: Gold Member (Offline)
Joined: Sep 7 2008
Posts: 488
Re: The Daily Digest

I love headlamps, crymoney. When someone offers me a flashlight I look at them with virtual contempt, "A flashlight?"

capesurvivor's picture
capesurvivor
Status: Platinum Member (Offline)
Joined: Sep 12 2008
Posts: 963
Re: The Daily Digest

Hmm...do you have any doubts that the well-to-do will feel a lot less pain? Firearms and survival stuff is flying off the shelves.

 

SG

crymoney's picture
crymoney
Status: Member (Offline)
Joined: Sep 5 2008
Posts: 18
Re: The Daily Digest


That's true, I did forget to mention community interaction and believe that is the most important. But here also some specifics would be helpful. A community in agreement and working together toward common goals is powerful. Remote rural communities almost always practice some intra-community cooperation because it's the only logical option. But such community interaction does not evolve spontaneously within a metropolis. Like many, I live within a mega-metropolis. Looking out for each other in the rat race of the city is going to require some new thinking and I am all ears for suggestions.

If in seeking ways to avoid pain we can be accused of shirking then I stand accused and proud of it. I'm an old fart but am surrounded by little kids. It's more their pain than mine that keeps me looking for anything and everything that can smooth their path.

It really is pretty odd that the best suggestion I have for everyone is to buy a headlight. 

James Wandler's picture
James Wandler
Status: Martenson Brigade Member (Offline)
Joined: Aug 12 2008
Posts: 219
Re: The Daily Digest
crymoney wrote:

That's true, I did forget to mention community interaction and believe that is the most important. But here also some specifics would be helpful. A community in agreement and working together toward common goals is powerful. Remote rural communities almost always practice some intra-community cooperation because it's the only logical option. But such community interaction does not evolve spontaneously within a metropolis. Like many, I live within a mega-metropolis. Looking out for each other in the rat race of the city is going to require some new thinking and I am all ears for suggestions.

crymoney,

Actively looking for answers is definitely the first start. 

Quite a few of the active posters on this site (which doesn't include me) practice sustainable living in rural areas.  In terms of preparation considering relocating to a rural area (as I am in the process of doing) would be a Tier 3 activity in Chris' Framework for Action.  I do hope that people seriously consider this option because Chris has identified that the areas that the mainstream would consider more marginal (e.g. rural) may actually be the most desirable areas to be located in. 

Having said this everyone must consider their own personal situation for constraints and opportunities.

I'm actively looking for solutions and yes, I'm suggesting sustainable farming.  I'm currently working through the book You Can Farm: The Entrepreneur's Guide to Start and Succeed in a Farming Enterprise by Joel Salatin and he recommends that people get into farming by starting very small - perhaps in their own homes.  Farming is less about growing food than it is about identifying a market niche and then growing food and adding value by processing and marketing a finished product.  This provides a return on labor with low capital and since you are entrepreneurial it is an excellent opportunity for someone who doesn't have a job.  Once you have built up your clientele you can then expand by renting a few acres to grow more food and continue using labor to produce value added products.  Eventually using this method Joel indicates that one can bootstrap their way into buying land and continue to expand opportunities.  Joel has many ideas of how one could start in a mega-city and the best thing to do is to do some research and get started.

Another approach for someone with wealth would be to purchase land as a store of wealth, and if the purchaser was older, to partner up with someone younger who could work the land. 

I'd highly recommend that everyone on this site read this book as a starting point (even those already living sustainably).  Joel is very detailed and has excellent seasoned advice. 

All the best,

James

FarmersWife's picture
FarmersWife
Status: Bronze Member (Offline)
Joined: Sep 22 2008
Posts: 30
What To Do

crymoney,

try sharonastyk.com webblog for the practical day to day information to reshape your framework.  She has been writing for a couple of years so there are tons of archives with down-to-earth info on how to adjust to a much more "local" living.  It is approached not from the "OMG, the sky is falling" but instead, how to build and enjoy a different lifestyle. A healthier, productive, sustainable lifetsyle that we would choose "anyway" because it meets human needs instead of just collecting more & more things.

I don't agree with everything, but there is a lot of good common sense on how to approach many of the issues.  And of course, the comments are a wealth of information, as well.

have fun, a 

 

Doug's picture
Doug
Status: Diamond Member (Online)
Joined: Oct 1 2008
Posts: 3159
Re: The Daily Digest

You might want to check out www.spingardening.com.

They also have spin farming, which is the same concept on a commercial scale.  But, that scale is pretty small.  You can make money or produce a lot of food for yourself on very little land.  I know of at least one sustainable community that is putting this method into practice.

crymoney's picture
crymoney
Status: Member (Offline)
Joined: Sep 5 2008
Posts: 18
Re: The Daily Digest

Thanks to all. Suspect this subject will be ongoing.

pinecarr's picture
pinecarr
Status: Diamond Member (Offline)
Joined: Apr 13 2008
Posts: 2244
Re: The Daily Digest

ThinkOutOfTheBox, thanks for the link to sharonastyk.com .  It looks like it has a lot of practical information for those trying to move towards a more sustainable lifestyle!

gyrogearloose's picture
gyrogearloose
Status: Platinum Member (Offline)
Joined: Sep 8 2008
Posts: 537
Re: The Daily Digest
Doug wrote:

You might want to check out www.spingardening.com.

Grew up on a farm, had a 1/8 acre vege garden that provide a good portion of the veges for the 5 of us. ( maybe we could have had higher productivity of it, but we we running a farm to. )

So when I looked at the front page of spingardening said "Its precise revenue targeting formulas and organic-based techniques make it possible to gross $50,000+ from a half- acre." my bullshit meter went off

And you have to buy their package of "How to"

The are many more sites out there that will help you produce food of small plots without the grandiose claims or fees. Much cheaper to spend a bit more time surfing.

Hamish

ckessel's picture
ckessel
Status: Martenson Brigade Member (Offline)
Joined: Nov 12 2008
Posts: 480
Re: The Daily Digest
crymoney wrote:

That's true, I did forget to mention community interaction and believe that is the most important. But here also some specifics would be helpful. A community in agreement and working together toward common goals is powerful. Remote rural communities almost always practice some intra-community cooperation because it's the only logical option. But such community interaction does not evolve spontaneously within a metropolis. Like many, I live within a mega-metropolis. Looking out for each other in the rat race of the city is going to require some new thinking and I am all ears for suggestions.

If in seeking ways to avoid pain we can be accused of shirking then I stand accused and proud of it. I'm an old fart but am surrounded by little kids. It's more their pain than mine that keeps me looking for anything and everything that can smooth their path.

It really is pretty odd that the best suggestion I have for everyone is to buy a headlight.

crymoney,

I think it is a great suggestion! There is also quite a variety of other equipment and preparedness info on the LATOC site referenced on the CM home page.

While the financial crisis has our attention rivited and we are scrambling for ways to preserve our assets I am more concerned with the Tier 3 issues and how to de-industrialize our lifestyle. I too am an old fart and I am concerned with establishing a new reality for the kids around us. The video game culture will not provide many solutions for the issues that will face them. So I am using the resources available now to establish a community effort to create and teach bio-intensive farming. This would also be needed in metropolitan areas. The old Victory Garden approach.

I live in a rural area and I am thankful for the opportunity this Thansgiving to share with friends and family and all of the newfound friends on this website. I worry for my daughter who lives in LA. Not much of a sense of community there. Seems like we will need some of our remaining fossil fuels to remove a portion of asphalt and concrete to get things "growing" again.

The best to you and your family this Thanksgiving.

cjk 

 

 

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