SPX/ES

SPX projection 11th March 2009

Change at 01:40

It's time for change.

It's 01:40 and I can't sleep.

I've just checked on the live feed for Big Brother and they are all asleep.

I've just tuned into one of my old fall backs, Talk Sport Radio, only to discover that along with the rest of the media, it has been terminally dumbed down. Instead of the social or political debate of a couple of years ago we have a Brummy presenter talking about shops with funny names, like "Paws for thought" for a pet shop.

In desperation, I've just tuned into Sky 503, BBC news, to be immediately confronted with a lecturn on an empty stage with a huge sign behind it saying "CHANGE". Apparently it was a backdrop for an Obama rally which was about to be broadcast live.

Politicians who preach this utter meaningless shit, (Blair, Brown, Cameron and all of their hangers on spring to mind) drive me to despair.

It's time for a change.

I blogged for a year 2005-2006.

I took a year off 2006-2007.

I blogged for another year 2007-2008.

I need a change, so it's time to take another break and return to my spiritual home, my day job, financial blogs.

I will almost certainly be back in a years time, if not sooner.

An honest politician

“Health Minister Ivan Lewis has called (link) on the government to consider a tax on high earners to help the middle classes through the economic slowdown. This would ensure "meaningful extra help" for the hard-pressed middle classes who "work long hours for their two holidays a year", but are now struggling with the basic cost of living.”


The country faces its biggest financial challenge since the great depression, and this is the solution? We get the usual socialist answer to everything, “Tax the rich”, but now it has a new spin, “…and give to the middle classes” rather than the traditional, “Give to the poor”.

This, I suppose, is an indication of just how far we have sunk as a nation.


As I read this article I was looking forward to hearing Ivan Lewis’s economic analysis. How would his ideas work in fighting the recession, and what are his estimates of their beneficial effects on indicators such as inflation, GDP, the strength of the pound etc., but sadly of this there was no mention. Instead he gave the only justification needed by a modern politician:

“He warns that Labour will lose the next election if they do not take tough tax decisions to bail out core voters.”

Ah well, at least Ivan Lewis is more honest than most of them because he doesn't try to hide the fact that his proposals are nothing more than an attempt to buy votes.

The Global Warming Consensus

If I see the phrase, "The Global Warming Consensus" one more time I'm going to scream.

Science, as it must be to progress, is profoundly undemocratic. It’s a shame that not only the masses, but learned popular commentators and political policy makers haven’t got a clue that this is the case.

And they’ve no excuse for their ignorance. The fact that scientific consensus is worthless was understood 500 years ago.


"In questions of science the authority of a thousand is not worth the humble reasoning of a single individual."-

- Galileo Galilei Astronomer (1564 - 1642)

Mark Wadsworth is on to something.

Thanks Mark for pointing out in the comments to my last but one post the similarity between Nigel Farage and Dmitry Medvedev.

Here’s the plan

We send Nigel over to the Kremlin, Nigel drugs, binds and gags Dmitry and hides him in a cupboard. Nigel then sends in a peace keeping force to the UK, deposes New Labour and appoints UKIP as a puppet government.


It might just work.

Continued improvements in education

Year upon year tractor production increases thanks to the ever more rapidly evolving brains of homo sapiens.

The evolution of distinct traits used to take a minimum of around 25 generations or perhaps 500+ years to occur. Now, thanks to the magic pixie dust used by both Tory and New Labour politicians over the last couple of decades, IQ is evolving at such a pace that 100% A-level success is merely a few years away.

If he was around today, Einstein would certainly be classified as “special needs”, so rapid has the growth in intelligence been.

I feel sorry for the Chinese and other Asians who have deluded themselves with the belief that churning out hundreds of thousands of scientists, technologists and engineers the old way using rigorous standards, hard work, and a concept of excellence is somehow going to help them.

If only they would wise up, and adopt progressive western methods the world wouldn’t today be facing such a severe shortage of geography teachers (link).

Please don't

The US is sending troops to embattled Georgia in the form of a humanitarian aid exercise, President George Bush said (link).

Mr Bush said military planes would deliver supplies in a move which would put American forces in the heart of the region.

The president said he was concerned that Russia might be violating the ceasefire in Georgia and he expected all Russian forces to withdraw.



Mr. Bush, you’ve just spent the last week bad mouthing the Russians, now you say you are going to look them in the eyes to see who will blink first.

Why don’t we just agree that President Mikheil Saakashvili screwed up. Whether he was suckered into invading S. Ossetia and fell into a cunning Russian trap, or whether he invaded on his own initiative, he still screwed up. And Mr. Bush, please don’t ask us to believe that you are shocked by the rape of Gori today by Ossetian militias because the Georgians did equally bad things to Tskhinvali last week. In fact the various factions in the Caucasus, just like those in the Balkans, do this sort of thing to one another at every opportunity.

Might I suggest that you pop over to Moscow instead, open a few bottles of vodka, and have a good piss up with Putin and Medvedev. OK, you're a reformed alcoholic, but we all have to make sacrifices, so take a lot of tonic with it.

I think this will be a preferable strategy to starting World War III.

NHS trusts face fines for poor hygiene.

Fines of up to £50,000 will be imposed on NHS trusts which breach hygiene regulations in a crackdown on hospital infections (link).


A nice try, but what will happen if Trusts are fined?


They will have less money to spend on hygiene control.


Instead of taking £50,000 off them, would it not be far more effective to give such trusts an extra £50,000 and then to fire the half a dozen or so useless bureaucrats who were in charge at the time the hygiene regulations were breached.

Georgia on my mind

At last a welcomed Russian cease fire.

Not being a particular fan of Russia, I am surprised to admit that I rather admire the tactics of the Russian army. Being firm, decisive, and overwhelmingly crushing the enemy is what armies are supposed to do.

They did their country proud.

Contrast this with the current state of the British army in Iraq today. It’s not quite sure if it’s there to fight or to be a branch of the social services, and the troops know that any mistakes, or any use of “excessive” force, will immediately be pounced on by a flock of human rights lawyers.

A good friend of mine has served in Iraq, and I was shocked when he mentioned some of the rules of engagement, particularly the one whereby he was allowed to shoot anyone who was in the process of throwing a grenade at him, but that he faced a court martial if he shot them after the grenade had left their hands, or if he shot them when they were running away after the attack.

Thanks to the training and dedication of our armed forces they are still a very effective force, but how much longer before they join all of our other institutions in the trash can of social reform?

Obituary - Billy Cotton

My mum and dad were big fans.

I’ll never forget when I was a lad, cringing at the prospect of another thirty minutes of awful music hall big band music every time I heard Billy Cotton's punch line “Wakey-Wake ah” at the start of Billy Cotton’s Band Show on the TV.




But that was the other Billy Cotton, his dad.

Rags to riches - lesson 1

Last week I speculated that it might be time to invest a little more in some gold shares to fund a holiday in the Canaries in a few months time. Gold has taken such a big hit lately that it could be time for a bounce, and this morning’s price, $855/oz, was a reasonable technical entry point.

So I bought 180 shares in Yomana Gold, and 40 shares in Randgold Resources.


The price of gold then collapsed to $820/oz.

Ouch.

Will it be a week in the Canaries, or a weekend in Cleethorpes. Time will tell, but it’s just as well that I like Cleethorpes.

On a planet 4 degC hotter, all we can prepare for is extinction.

Oliver Tickell in today’s Guardian (link):

We need to get prepared for 4degC of global warming climate science adviser to Defra Bob Watson told the Guardian last week, but the idea that we could adapt to a 4degC rise is absurd and dangerous. Global warming on this scale would be a catastrophe that would mean perhaps the beginning of our extinction. There's no 'adaptation' to such steep warming.



And there was silly old me, in the face of such a threat, only planning to buy some tank tops, Bermuda shorts and sandals.


But wait, maybe Oliver Tickell is a crazy, wide eyed greenie, promoting some hidden agenda?



(link) The peak of the Medieval Warm Period was 2° warmer than today and the Little Ice Age 2° colder at its worst. The total range was 4° centigrade. Looking at the last 400,000 years of data. The temperature range from top to bottom was 10° centigrade.


Well, it seems that the human race has experienced worse in the past.

Rather than go extinct, I think I’ll stick with my first plan; tank tops, Bermuda shorts and sandals.

Obituary - Isaac Hayes

I was never a big fan of Isaac Hayes.

RIP

Britain not broken says Brown

Gordon Brown has dismissed the idea of a broken society in Britain, saying the country is "Decent and compassionate” (link). “I think Britain is basically a decent, compassionate society and most people want to see things change for the better."

Mr Brown highlighted knife crime as "the biggest problem at the moment" in some cities.


My god, I hate this bastard so much.

Knife crime is not our biggest problem you stupid bastard. Knife crime is just a symptom.

A symptom of what total idiots like you, Gordon Brown, have reduced this country to.

If it wasn’t for people like you, Gordon Brown, scummy little shits currently strutting around knifing one another would never have got to this stage of aggression.

Furthermore, the clueless touchy feely, multi-culti bollocks that people like you, Gordon Brown, preach makes it possible for teenagers to believe that they are untouchables amongst an older generation who are afraid to intervene because people like you, Gordon Brown, pass laws and incentivise the police to penalise the upright citizens at the expense of the criminals.


Oh, I give up………..what’s the point?

BBC's take on special needs

Who are the low-achieving pupils (link)? Among those 11-year-olds who failed to reach the expected level in their English tests, 84% were classified as either having special needs, English as a second language or else qualified for free school meals.

Who are these struggling children?

Among this low-achieving group, 59% had special educational needs, 26% were eligible for free school meals and 14% had English as an additional language.

Ethnic background is another factor. For last year's results for English, 80% of white pupils reached the expected level, the same as the national average, while the figure was 72% for black pupils.

Given that only 3% of pupils do not make the grade among those who do not have special needs, free school meals or English as a second language - it means that any improvements in annual results will have to address such multiple challenges.


I love the way this BBC News education reporter presents the facts, but stops well short of breaching any taboos. Instead the article leaves the reader hanging in the air. We are only given a hint as to the politically correct solution; that these “multiple challenges” will have to be “addressed”.


I’m happy to help interpret this data, and suggest a way forwards.


On average:


Special needs = not very bright.

The poorest pupils, i.e. those in receipt of free school meals = not very bright.

Black pupils = not very bright.



And the way forwards?

It's pretty fucking obvious really, it's is to educate each pupil to their fullest potential.




There you go. Stating the truth doesn't hurt that much does it.

Is smoking a genetic illness?

University of Michigan scientists (link) have identified a gene variant found more often in people who said their first cigarette produced a "buzz". These people were much more likely to go on to become regular smokers, the journal Addiction reports.

The gene in question, CHRNA5, has already been highlighted by other studies into nicotine addiction.

Genetic data was obtained from 435 volunteers, some of whom were regular smokers, and some who had tried cigarettes but were not currently smokers.

Regular smokers were far more likely to have the variant version of the gene and more likely to report that their first smoking experience was pleasurable.





Let me think this through.

If a propensity to smoke has a significant genetically determined component, then how can the health and safety fascists and governments justify their continued persecution of smokers?


There is a potential for much confusion here.

I predict that the University of Michigan scientists are likely to find their funding under pressure if they continue down this road.

Just to avoid any more “confusion.”

Confirmation of the coming recession

This is the clearest confirmation that I have yet seen that we are going to enter a deep recession over the next 12-18 months.


Banks should make plans based on the assumption the economic downturn could be as bad for them as the recession in the 1990s, the City watchdog has said. The warning from FSA chief executive Hector Sants comes a year after the credit crunch officially began (link).



Ask yourself, why did the FSA think this statement necessary? Of all people, the bankers know what is coming because they caused the credit crunch in the first place. The banks know that they still have an avalanche of credit write downs in the pipeline, that defaults have yet to peak, that they are facing insolvency, and that many of them not bailed out by the tax payer face bankruptcy over the coming years.

So why has the FSA made such an apparently pointless public statement telling the banks what they already know?

The answer is obvious. The FSA know that things are going to get worse. Having taken flak over Northern Rock, the FSA have issued this public warning today so that in 1 or 2 years time, or whenever the government come looking for scapegoats again, then the FSA can say they did all they could to warn of the coming catastrophe.

When fantasy meets reality

Along with many right wing bloggers, I’ve been saying this would happen for many years now; that when the comfortably wealthy, self indulgent, middle class eco-warriors faced an economic downturn, then saving themselves was likely to take priority over saving the world, and it is now happening according to Alice Thompson writing in the Times today. (link):

So the salad days are over; it's the end of the greens. Where only a year ago the smart new eco-warriors were revered, it's the chilly economic climate that has frozen the shoots of environmentalism. Espousing the green life, with its misshapen vegetables and non-disposable nappies, is increasingly being seen as a luxury by everyone.

Only a year ago, according to MORI, 15 per cent of those polled put the environment in their top three concerns. That figure has dropped by a third to 10 per cent this month.

According to Andrew Cooper, director of the research company, Populus: “When times are tough people resent paying more to salve their conscience.”

With all food prices rising, the organic market is being credit-crunched. Demand for it grew by 70 per cent from 2002 to 2007; now it has stalled, according to the consultancy Organic Monitor.

The vast new organic Whole Foods Store on Kensington High Street in London is so quiet you can hear the cheese breathe in the specially designed glass room. Meanwhile the demand for takeaway pizzas and McDonald's has risen as people find the cheapest way to eat.


The article goes on to tell us that the Tories have seen the light and are now acting accordingly:


When David Cameron became leader of the Conservative Party he said that green issues were at the top of his agenda. His slogan for the local elections last year was “Vote Blue, Go Green”. But in the past few months he has realised that voters have lost the appetite for their greens.

He has only given one environmental speech since Christmas.

Boris Johnson was the first to realise that the tolerance for green taxes may have peaked. When he became Mayor of London, he dropped plans to charge a £25 congestion fee on gas-guzzling cars.

The Tories have quietly been reviewing many of their green policies. A range of measures designed to penalise motoring and other polluting activities has been put on hold in case they alienate families struggling to pay their bills. A proposal to tax the highest emitting cars up to £500 more than the greenest vehicles has been quietly shelved, as has the plan to raise taxes on short-haul flights. Instead George Osborne, the Shadow Chancellor, has promised to cut tax on fuel when oil prices rise.


I must admit to mixed feelings concerning the Tory about face.

I’m happy that they are showing some common sense by adopting a more voter friendly stance, but I’m also angry that they embraced the greenie psychosis in the first place. If they had truly believed that they were acting to save the planet, they wouldn’t be backing off now at the first signs of an economic downturn.

Rescue plan to save property market

Alistair Darling (link) is drawing up a series of radical proposals to revive Britain's beleaguered housing market as new figures show soaring numbers of homes being repossessed.

Among the measures being considered by the Chancellor are:

*A plan to reintroduce income support for mortgage interest payments for homeowners who lose their jobs.

*Suspending stamp duty so buyers only pay the tax after several years in their new home, or perhaps not until they sell the property.

*Creating a new, tax-free fund to help first-time buyers raise the deposit they need to get on the housing ladder.

Ministers are also looking at extending schemes to buy empty properties, particularly in city centres, and turn them into social housing.



Or, to summarise, transfer our taxes to the banks via the unemployed; add to the future debts of homeowners by defering stamp duty; use our taxes to pay some of the deposit for first time buyers who otherwise couldn’t afford to jump onto the treadmill; use our taxes to buy houses at prices above their market value.

Have you noticed what most of these Alistair Darling initiatives have in common? It’s to throw our taxes at the problem in the hope that the problem goes away. This, as we all know, is the standard modus operandi of New Labour, and the problems usually get worse when this is done. At best, we will enter a grinding housing lead recession as the banks slowly recapitalise themselves at the expense of the tax payer. In the longer term, banks and house buyers will know that the government will always be there to bail them out.

As a result the next bubble will be even bigger.

The plight of mortgage payers, particularly those who bought recently and those who took out more loans as the notional value of their properties rose, is an unfolding tragedy that will cause much pain and suffering, but one of the most annoying outcomes is the prospect of New Labour politicians pretending that the billions of lost wealth can somehow be restored. All bail-outs will be designed for the benefit of the banks and financial institutions, and what crumbs are given to homeowners will be given to this end.

Following the example set in the US, New Labour are going to launch a smoke screen of “iniatives” like the ones discussed above to hide the destruction of wealth that has already occurred, and will continue to occur over the next 18-24 months. Repossessions will continue to rise alongside a frantic PR exercise from New Labour to give the impression that they are doing all that they can to save homeowners.

What they in fact should be doing if they were sincere in their claim that they are trying to help homeowners is to make the banks and building societies play the leading role by forcing them to eat their own losses. The institutions themselves, including the personal finances of their managers, their shareholders, and their bondholders at home and abroad can afford to take a hit, and should be taking a hit because their greed and financial chicanery caused the problems in the first place.

Still, there can be no winners. Swallowing my medicine would precipitate many more bank failures than we are going to see, but I think it would be a shorter, if sharper recession than the multi-year affair we now face, and the new banks that arise from the ashes wouldn’t dare repeat the excesses of their predecessors because they will know that they will be held accountable for their greed.

Gold

Commodities and energy are currently being crucified, and whilst optimistic bulls are claiming that we are through the worst of the credit crunch, contrarian bears are increasingly coming around to the view that with money being hoovered up by the banks to shore up their balance sheets, and with credit disappearing, we face money shortages and deflation.

Gold does well in an inflationary environment, so it has few friends at the moment either amongst the bulls who see it as a dead relic, or amongst the bears who foresee it acting as just another commodity as deflation takes hold.

Today gold is slumping towards long term support at $880/oz and approaching make or break territory if it is to sustain it's five year bull run.





Being a gambler wise contrarian investor, who wants to win enough cash to visit Fuerteventura this autumn or next spring, I’m seriously considering buying some gold shares next week.



The time to have invested in gold over the last six years was when sentiment against it was at a cyclical low. Now is certainly one of those times if one accepts, like I do, that the US dollar is destined to fall significantly further, that the rise of China is set to continue, and that gold should recover to new heights over the next few months as a result.



40 shares of Randgold Resources plus 40 shares in Gold Corp. should do the trick, but do I have the courage to take the plunge?

We’ll see.

Bugger

I just spent an hour crafting a brilliant, and incisive critique of the current SAT results released today.

And then my PC crashed before I saved it.

So here’s an off the top of my head summary of what I originally wrote.




The SAT results are rigged.

We’ve all witnessed the marking chaos over recent weeks, read about the lost results, and seen the stories highlighting poorly qualified exam markers and badly marked papers.

Yet in today’s headlines we are told that in English and Maths 1% improvements were made in the level 4 results.

Isn’t it strange, in fact bordering on the miraculous, that from the depths of chaos and incompetence, we get exactly the result the government wants. Less than a 1% gain would have been seen as “no improvement”, more than a 1% gain would have put too much pressure on next years fudge making the results even more unbelievable next time.

And my proof of the above is? I haven’t got any, it’s just a gut feeling.

The Tory alternative to New Labour control freakery, thievery, and lies.

More of the same.


Here’s a taster from today’s press that gives us some idea what we can expect (link, link) once New Labour’s oppressive, high taxing, and lying government is thrown out of office.



Control freakery:

"Lad mags" encourage irresponsible behaviour among young men and promote a negative image of women, a leading Conservative is due to say. Shadow education secretary Michael Gove is expected to link the magazines to relationship breakdown and fatherless children in a high-profile speech.



Butt out Gove, don’t start micromanaging our lives like the last lot. Your abilities and powers as a government to change society by tinkering around the edges are too crude, and always counterproductive. Just give us a clear, firm, consistently applied legal system and benefits system that reward responsible behaviour and family oriented behaviour, and severely penalise anti-social behaviour. Then stand back, do nothing, and just watch from the sidelines. Society might then evolve back (devolve?) to something resembling a civilisation rather than the proto-fascist state you bunch of useless politicos have been constructing.



Thievery:

Government plans to increase car tax for "gas-guzzling" vehicles should be bolder to increase the environmental impact, MPs say. The Environmental Audit Committee's official report backs the move as a "step in the right direction". Chairman Tim Yeo said the benefit to the environment would be limited, and called for more ambitious changes.



We all know that energy prices, including fuel, have soared over the last few years, and after a possible dip in the coming recession, the growing, and increasingly industrialised 6.5 billion world population will ensure that energy prices continue to rise, as shortages grow. There is nothing we can do to stop this trend. Driving the British into poverty by targeting the poorest with regressive taxes is not only cruel but also completely pointless.



Lies:

Michael Gove will quote figures that show almost half of children from deprived backgrounds fail to get a single good GCSE - a level of inequality which he brands a "national disgrace". Official statistics released by the government in response to Tory questions reveal that 45% of the poorest children - those eligible for free school meals - failed to get a GCSE at grade C or above in 2006/07, compared to 24% generally.



I’m not sure if this comes under “lies” or “stupidity”, but I’ll give Gove the credit that as shadow Education Secretary he knows why twice as many recipients of free school meals do poorly at school than kids who do not get free school meals. It’s because they come from the poorest group of society, and that welfare dependency is negatively correlated with intelligence. Instead of patronising this group, and condemning then to guaranteed failure, any compassionate person would reduce the formal education requirements for these kids, and emphasise vocational and non-academic skills development.


and yet almost certainly knowing the above, here is Gove’s solution:

The Conservatives will rebuild parents' relationships with schools and put well-being at the heart of their government.


Tony Blair couldn’t have put it better himself.

What's happening?

Does anybody know why Internet Explorer is reporting "Access denied" when I try and open other blogs? I've seen a mention of this problem on one of the sites I was allowed to open, so I don't think the problem is with my PC.

I'm now using Firefox which seems to be coping better.

What's happening. Has the New World Order finally taken over the internet?