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Monthly Archives: October 2008

While I do feel in body and brain that I was indeed zapped down this black hole (this is a long-ago train tunnel which intersects with the former World Trade Center site, and was visible on the huge concrete restraining wall at Ground Zero), instead I was on USA tour, a grinding journey as I had predicted to myself.

It started off dubiously 12 days ago, with my flight from Seoul (to Vancouver to NYC to Chicago to Omaha) canceled owing to mechanical problems on the Air Canada jet.  Impressing on them that I could not wait 18 hours for the replacement flight to meet my Lincoln NE obligations, they booked a Korean Air flight direct to Chicago the next day, and put me – and all the other disgruntled passengers – up in an opulent Hyatt hotel near the airport, with a food coupon.  So it was a little silver lining in a schedule change, a more merciful itinerary deleting the expected midnight to 7 am sleep-on-chairs in NYC plan.  On getting picked up in Omaha Dan Ladely drove me to Lincoln, though his State owned car crapped out about a mile from our destination and I waited an hour by the highway while he went into town to get a tow-truck.  I thought, hmmm this trip is looking kinda jinxed.  In Lincoln my screening was in autumn break, so the campus was nearly empty and my audience was minimal – mostly people I knew and who were involved in the films I was showing – PARABLE and a rough very unfinished version of SWIMMING IN NEBRASKA.  However as I had set up the trip to fit the mid-term exam week here in Seoul, but also to see Leighton Pierce’s installation at the Sheldon Museum in Lincoln, it was half my fault.  Though frankly I doubt the numbers would have shifted significantly had school been in session.  They would have all been doing something to prepare for the Big Game, with whomever.    But Lincoln was a pleasure with 2 nights in a lovely B&B, which in its former life had been a judge’s house, a sprawling mid-western item from early 1900’s.   And I got to see a few friends, and Leighton’s stunning piece, of which I will write in the next days over at www.jonjost.wordpress.com.

Then it was to Chicago, and visiting friends there, crammed into which possible hour they could manage (a 7 am breakfast at Marilyn’s where I was staying).  FACETS screening was OK, though their projector is an old LCD one that makes for a washed out and digitally artifacted image.  Thin audience again.  One local culture rag had it pick of the week, which tells you all about the impact of such things.  Went out for a beer with a few of those there.  And then it was off to Philadelphia via Newark NJ flight and Amtrak on down.  Bored in the little waiting room of Amtrak with an hour to eat up, I took out the camera and shot about 20+ minutes of interesting footage which I think will make for a nice short, before having a young security guard come up to inquire what I was doing, and telling me shooting was not permitted.  America, Land of the Free, where there are now Free Speech Zones.   I haven’t looked at the footage yet to see if I was still recording while he spoke.  Hope so.  Then got on train (Business Class – ordered by the place I was going to talk), and was shooting when guy in front of me, doing biz, cell-phoned an associate and described the process of terminating a woman from her job.  So goes business in America these days.  Arrived in Philadelphia where I was picked up, checked into hotel – very classy older one right near Independence Hall – and then taken out to an Italian restaurant.  Next morning, after the you-pay-for-it hotel breakfast at $25, was taken out to Rowan State Univ across the river in New Jersey, there to meet the faculty and then do a one hour talk for students.  The room was packed, though with students who looked like players in a live version of the Simpsons.  We were prepared for projecting some things, but the talk went too quickly and we got caught up short and after 60 minutes it was over.  Everyone was very pleased and then it was off for an afternoon of lunch, visiting museum and getting a by-car quickie look at architectural things.  Central Philadelphia, the old part, is lovely, and there are many nice older buildings.  Next morning I checked out, noting the 2 night tab at the hotel was $750+.  And I thought, as I always do in such places, who the hell stays here?  I wish they’d put me in a Motel 6 and given me the surplus.   Aside from not feeling comfortable in such places, I could use the money.

Then on to NY on Amtrak, and a rush of things before the next night’s screening at the Walter Reade Cinema, for the Lincoln Center Film Society. On arrival in NYC, to stay with friend Jane, she had just been informed by her roommate (rents out a room for the $) that she’d just been terminated at work.  I felt like I was getting the pulse of the nation in some way.

Friday night in the heart of “culture” at the premiere cinema for artsy work, in a city of 9 million, screening noted on the mailing list, internet website, etc. etc. (but not, because the corporate powers no longer permit plugs for one-off showings, and basically do no coverage unless it is a theatrical release in a commercial cinema, in the papers), the audience was under 30, and half were friends and acquaintances.  Just like Lincoln NE !!!   Which is a dismal signal about which I will scriven over on the blog as soon as time allows.    Next day did a workshop at Millennium, down on 4th Street, and showed film in the evening to a thin audience.  Workshop went well with 11 people, which covered Howard’s costs and more for me, so maybe he made a dime.  And then went out with Matthew to burn up time until 2:30 a.m. and went via subway out to JFK to catch 7 a.m. flight back to Seoul via Vancouver.  Up now at 5 in the morning, unable to sleep though being exhausted from the cumulative trip.

The US didn’t yet seem to be showing so much on the streets the economic squeeze in play, though little signs pointed to it.  Fewer people out for Friday night fun, jobs being shed, and a vague aura of gloom pervading the atmosphere.  Meantime in the last 4 months, but most of it in the last 4 weeks, my earnings here in Seoul shriveled drastically: 6 months ago 98 won = one buck; now it is 142.  Meaning if I go out of Korea to USA, I lost 40% of the value of my pay.  Compelling reason to stay here, or to shop around for some place in which the currency exchange loss hasn’t been so drastic.  So no USA, no Japan.  Didn’t collapse so much against Euro.  I must research other places and think about moving there.  Argentina?  Chile?  Or….

As imagined, the stock market continued to fluctuate wildly, though the downs always exceeding the subsequent ups, and I think it will do so down to 5000 Dow points, or even lower.  Governments have been printing wildly, while Central Banks keep dropping interest rates, looking to grease the wheels of commerce (spelled c-o-r-r-u-p-t-i-o-n), as the big investment banks, now flush with new greenbacks, still intend to give bonuses for the alleged “good performance” of the top honchos, etc.   Over in the political spectrum McCain persists in stabbing himself, with his lovely VP choice appearing to twist the blade a bit, just in case he feels an itch.  On the other hand, in hotel looking briefly at TV, I saw a little note on Fox or maybe it was CNN, saying the police departments (cut to shots of riot squad black uniformed and shielded goons, still bearing such quaint phrases as “To Serve and Protect” and not quite yet bearing the Blackwater logo) around the country are beefing up for the election just in case Obama loses and voters are disgruntled.  This went by casually, but reading between the lines one could see FIX in the works.  Given the transparent vote suppression, electronic vote machine “glitches” and courtroom maneuvers already in play by our troglodyte Right, it would seem they are trying like hell, same time as Bush cranks up the bomb Syria Iran Pakistan meter, hoping to provoke some kind of game-changer response.  However I think they lost, and were such an attempt made, there would indeed be some mayhem on the streets, which would rapidly escalate if the “police” or the US battalion brought in for domestic disturbances were indeed brought into play.  To coup or not to coup, that is the question.

UP and DOW(n) JONES

Chart for last month.

Mr Paulson this weekend, after a huddle with the honchos of the G7, led by Gordon Brown, until this moment hapless new PM of the UK, now hero of the alleged rescue plan for the foundering economies of the industrialized countries.  Paulson’s happy, having been hoisted off his own petard, a new advocate of Euro-style socialism, quite a leap for this happy Wall Street capitalist who, until his own system was about to go down the toilet, would have seen government take-overs of banks as a very pink, or even red (in the old usage) thing.  Wall Street and the other markets responded joyously, leaping up record levels – the DOW went up in the biggest jump since the 30’s (is this a good sign?) and other markets followed suit, recovering much of last week’s losses in a single faith-filled day.

So what is really happening?  The various governments have in unison decided to rev up their printing presses and throw public money into the black-hole of debt generated by the private sector’s greed, i.e., for example, Mr Paulson’s greed.  Just how this is done remains to be seen, but money is being churned out at levels previously unimagined, and for the questionable motive of keeping those who produced this problem afloat, so they can grease the economy with money of ever more dubious provenance.  Somewhat the walnut shells are being shuffled real fast, in an effort to show that not one of them has anything under it.  So who will gain with this?  The banks in their various modes, for sure.  The politicians who will stave off economic collapse a little longer.  And perhaps in an illusionary respite, JQ Public, not having to face just yet a full-fledged depression.  So governments will become part holders of depleted banks, perhaps jiggling the pay figures for CEO’s, and banishing for the moment golden parachutes and other practices of the suddenly finished Golden Age.  But somewhere that debt remains, nagging away, eating at the core of these economies.  Somebody is getting burned.  But as usual, it ain’t (yet) the guys at the top.  Instead its the ones at the bottom, with no job, no pension, no insurance, no nada.    So after all the “shock and awe” of the last weeks’ financial news, the U-turns of dyed-in-the-wool-uber-capitalists turning into bleating lambs of socialism, the wild roller-coaster of the stock markets, the bottom line is they’ve forestalled the day of reckoning by printing up bazillions of bucks and tossing it at the monster debt incurred by, well, ordinary human shit-headed greed and selfishness let loose in an unregulated Market Economy Paradise.  But worry not, the bill is coming, and no matter how much these guys try to dodge the bullet, it has their name written all over it.

Something about this picture shows Bush as a rumpled little boy, hands caught in the cookie jar, and not having the vaguest idea how to cope with it, and there behind him the assembled dignitaries of the G7, likewise caught by events they don’t understand or control, pretending “authority.”  Good luck!

Oct 9:

Now hooked on this drama, last night I looked at the NYSE when it opened, up a tad.  Then before going to bed I checked and it had bumped up a bit and then begun a swoon to minus 127 and then a stukka dive during my sleep to – 680.   Seized by panic, or something, Mr Bush announced he’ll address the nation, as if there’s anyone left listening.  I guess they’ll listen when he declares a national emergency, declares martial law, deploys troops – not national guard but remnants of whoever is hanging around from the US Army, and will cancel the election given that his party is clearly looking at a major loss next month.  So go the internet rumors, which seem to have some justification.

Oct 10:

Again before my bedtime, I check the NYT as the market opens, following a day of deep drops in Europe and Asia, and as word comes that the G7 and all the honchos of the business world will huddle to, to…. uh, well, to fess up that their vast Ponzi scheme of derivatives and leveraged this and that, and other financial world mumbo-jumbo was a fraud?  That debt does not equal value/asset?    I doubt it.   Instead they’ll work to coordinate a global run of the presses, cranking out more paper backed with, well, uh, the reputations of the printers.  That the reputations are below the zero line won’t do much to impress them since they don’t have a clue what else to do.   So the DOW crashed 600+ in the first hour and now has bounced back like a super-ball to minus 200, and as the financial system throw a rod, I am sure we’re in for a few more wild gyrations before the thing is smoking in a pool of oil.   Meantime behind the Oz curtain one feels the presence of levers being pushed, a con game being carried out, nevermind the logic has long ago slipped the gears of those who think they know what they are doing.

Morning, 11th.  After a day of wild oscillations, up 300, down 600, the DOW closed down a mere 128, a drop in the bucket of the flood of losses (40% since last year) of late.  In my book of metaphorical tools this is called “throwing a rod” – the last violent rhythmic movements before a car throws a rod and comes smoking to a halt in a pool of oil.   And so our mechanics somehow conveniently pre-scheduled to meet on this date, will conclave this weekend to sort out a solution:

Standing in the center of this is Mr Paulson, former CEO of JPMorgan, “investment bank” who made a mere 700 million thereat, has 500 million in shares thereof in a “hidden trust”,  and from which he received an 18 million bye-bye as he went through the revolving door to become US Secretary of the Treasury, in which role he is cast as a wizard of finances.  This same wizard has been wrong in his role as public oracle for the last year, always softening the story, murmuring consistently “it’s all OK” again and again.  Until a few weeks ago when he stiffed the Congress with dire “sky is falling” shrieks while asking for dictatorial control over the dispersal of a piddling 700 billion in public funds, exempt from legal or other oversight.  Now this is the same wizard who was instrumental in provoking this crisis with his voice lent to the many others demanding a loosening of the rules of banking and investment, so they could leverage and leverage, and run out on a limb of extreme debt which in their mystical language was converted into asset/profit.  I.e., yet another Ponzi scheme.   So the most respected Mr Paulson meets with other G7 fiscal magicians to try to figure out how to dig out of the deep hole of debt which in selling enriched them and their pals, but has left the economic system high and dry, one more time.   Of course it makes eminent sense that we should entrust the solution-making to those who just pulled off the heist.  You betcha..

So the weekend will be filled with further drama as those who engineered this financial Rube Goldberg device (the IMF, World Bank, and the lobbyists and politicians in the pay of Wall Street who loosened the Depression era controls, commencing under Clinton), will try to patch it together.  One prognosticator, Nouriel Roubini, who unlike most the others, was right in calling this over 2 years ago, proposes a drastic, dare we say, quasi-socialist, solution as spelled out in detail here.   Whether the rabid champions of “the free market” will suddenly don these pink clothes remains to be seen, but desperate days can make for desperate changes, so perhaps they’ll do so.  Whichever name it is given it will amount to governments revving up the printing presses and throwing lots of newly minted money at the rabbit hole of unpaid and unpayable debt, papering over the follies of the fiscal giants, thus, naturally, devaluing the money.  Shambling out of this will be new mumbo-jumbo to impose external regulation on the greedy behavior of humans, particularly those who are attracted to the financial world precises because they smell blood.  Dollars to the sharks !  Of course, over time none of the culprits will go to jail, more likely they’ll be handsomely rewarded with seats in “think tanks” and the like, or shuffled off to new banks and corporations to pad out their life-style needs.

If over the weekend they succeed in pulling this rabbit out of the top hat, there might be a little respite before the piper comes for his payment (again), and it all shudders once again to a halt.

The silver lining in these clouds:

If indeed the system grinds to a near standstill, it may for a decade or two, slow down carbon emissions, and perhaps in the hiatus of crazed consumerism and the capitalist mantra of growth growth GROWTH, there will be a philosophical shift in which the foundations of our poorly built society are questioned, and perhaps other values become ascendant and the industrial era is derailed for “good.”  It will take quite a halt to do this, a minimum of a few decades, but just maybe it will occur.  Wait and see. Meantime this weekend promises lots of secret blather among the nervous G7 souls, and nail-chewing from the not-so-innocent observers who wait to see how far their 401(k)’s and other paper “worth” has been or will be devalued.

A glance at the papers indicates that McCain, rabidly foaming as his chances to prove himself to dead dad go down the tubes, huffs and puffs about “the socialists taking over.”  Yep, Henry Paulson, socialist….

The Treasury secretary, Henry M. Paulson Jr., said the government would move ahead with taking ownership stakes in financial institutions as it tries to restore confidence.

And meantime out in the real world there’s “peaceful” post-surge Iraq:

And London

And somewhere in a field in Germany

By way of Owsley’s note tacked onto a posting on our ugly political world, here’s an interview with Nathaniel Dorsky on recent work.  You might try to find his “Devotional Cinema” for a very different view on filmmaking.  I used to be Nathaniel’s “dealer” after a fashion.  To say he’s a veritable film fetishist, loving stocks, cans, boxes, and from a very different angle – terminal cheapness from long-term poverty – I as a filmmaker (way back then) happened upon various chunks of film that I picked up for very low cost.  When living in San Francisco I used to give Nathaniel some of this for his collection of such things.  He’s in my Rembrandt Laughing, as are some outs from his sand film, Alaya, and some hand-processed material he gave me to use, of a lovely blue.

Here’s some more material on Nathaniel.

Scott McDonald, A Critical Cinema.

Alaya very short review.

Frameworks note.

Unfortunately so far Nathaniel has declined to get his stuff put on DVDs, which done well could hold it well enough, but he’s wedded to frame rates (shoots silent, 18fps), and other filmic things he feels can’t be transferred to DVDs.  Alas.

Thanks Owsley for the item.

At a Palin rally, following some acidic comments from Sarah about Obama consorting with “terrorists” someone from the crowd shouted “Kill him” (unclear if the “him” was Ayers, the one-time “terrorist” or Obama), and Sarah sailed right on, the Secret Service (seen above in their not-so-secret outfits) did not go seize the would-be assassin, and the lady continued on with her attack.  Ah, American politics are so uplifting…

Meantime on awakening, the Dow had plunged 800+ but in the last 90 minutes crawled back up 400+ and ended down 380 or so, to the “relief” of many.  This is a yo-yo with minimal up-pull, so it goes up and down, but the long term effect – entropy? – is   d  o  w  n.   Meantime global markets are similarly seizing up, so weird things are happening, such as my little stash of S. Korean won, which had lost 13% against the dollar, are now again even as they had been 6 months ago.  All in less than a week.  Go figger…

But, lest all seem grim and awful, here’s a little grace note:

Although perhaps the rabbit doesn’t think so.  Nor do the 401(k) suckers who bought into the Republican way to privatize your nest-egg.  It just got sucked out by a viper wearing pin-stripes.  Whatever, these are interesting days.

And last night, as I slept, the DOW dropped another 500+ points, despite a Fed announcement they’d drop interest rates, usually a waker-upper for stocks.  And retirement funds have lost a mere two trillion dollars in the last weeks…  Dumpster diving anyone?

And then this cynical item from the NYT on how the good guys at the trading desks in the market always have an angle to make a buck, in this case on the 700 billion alleged bail-out.  Cashing in and cashing out at the great Wall Street casino.

A week after the insurance giant, the American International Group, received an $85 billion federal bailout, its life insurance subsidiary, AIG General, held a weeklong retreat for its top sales agents at the exclusive St. Regis Resort in Monarch Beach, Calif. Expenses for the week, lawmakers were told, totaled $442,000, including $200,000 for hotel rooms, $150,000 for food and $23,000 in spa charges.

In addition, the former A.I.G. executive who led the London-based division whose implosion is largely blamed for the insurance giant’s downfall, Joseph J. Cassano, continues to receive $1 million a month from the company, on top of the $280 million he received in the last eight years.

And even after A.I.G. reported $5 billion in losses in the final quarter of 2007, its chief executive at the time, Martin J. Sullivan, argued before a compensation committee that executives should receive performance bonuses. He received $5 million.

This is the compensation these crooks – but these crooks mirror a large chunk of America, simply on a bigger scale – get for destroying their companies, and the US economy, with falsified bookkeeping, willful delusions, etc.  Exactly like President Bush and Dick Cheney, who in fact have engineered the largest tax hike ever – for your children and grandchildren….

A graph on how happy Americans are

In an hour the NYStock Exchange will open, in the wake of a 5% drop in London, Frankfurt, Paris as the sudden vacuum of debt which floated like a mirage of wealth begins to suck in everything in sight.

Bailing out the Bailouts

You know you’re in trouble when you have to bail out the bailouts.

Europe did that twice very late Sunday night.

A week ago, Germany arranged for banks to put up 35 billion euros to bail out Hypo Real Estate. It took only days for them to discover more losses, and to walk away. The newest arrangement is up to 50 billion euros, and includes government money.

So the grand Ponzi scheme of the US economy, engine of the world’s economy, buyer of first and last resort, has run out of gas.  The world clunks to a halt.  Of course Ponzi schemes don’t work for their always limited duration unless there are people willing to believe that you can get something for nothing, or that you even deserve to get a lot for a lot less.  America is full of such souls, which explains Vegas and many other things too.  And clearly so is the banking world of Europe and elsewhere, which seeing the multi-leveraged profits of Wall Street thought to bank in on the same items and duly bought up their fair share of mystical money-making debt, when any stupid asshole could see it was all a con:

Where the hell does an economy the GDP of which is 70% consumption have its “wealth”?  This is more a description of a cancer than a national economy, and yet our economists and politicians lived with it for decades, and the world went along, happy to feed us all while buying up our debt on the fanciful delusion that they’d get it back plus 20 or 30% interest, while they could see damned well the only thing America makes anymore is weapons, food, and Hollywood fantasies.  Not exactly a balanced diet.

And sitting off in his cave, or maybe a nice Saudi hospital, bin Laden’s strategy came true quicker than he might have ever dreamed in his wildest states:  the US has gone bellyup, bankrupt.  In another few hours we’ll know if Wall Street tanks down 1000 or 2000 or “only” 800.  Bet on it to zip down to 5000 or so in the next 6 months.

The elevator is going down…

And what is this likely to mean to you?  If you had 401K retirement tucked away, well now you don’t.  If you have a job, depending on what kind and where, likely in a while you won’t, especially if its in one of those vaunted “service” realms which the US economy had shifted to, jobs that serve those with, well, lots of money.  But if not so many have lots of money, well they don’t need your services anymore.

Etc etc., gloom and doom.  California needs a “loan” of 9 billion, NOW, to keep chugging along.  Another state, I forget which, likewise needs one.  So as Uncle Sam’s printing department cranks out all this unbacked new money, the bucks in your hands will shrink, curiously at the same time the price of everything goes up and up.

If Obama wins, they’re going to hand him a very empty bag.  On purpose?

—–

10 am in NYC – DOW down 300+ points and going south….

A few minutes later – 325

And then a few later – 340+

It’s my bed time but my guess is morning will see something close to -1000 for the day.  Under 10,000 for sure.  Shuffle those papers.

Bailing Out The Oil Market
Forbes Magazine

While everyone knows the U.S. government is looking to bail Wall Street banks, few people realize that it’s also bailing out speculative oil and commodities traders in the process, fueling a sharp rise in energy prices.

Lehman Brothers held enormous trading positions in commodities markets. If those positions had been liquidated suddenly, the price of everything from wheat to oil would have collapsed. The Commodity Futures Trading Commission the main regulator of U.S.commodity markets, allowed Wall Street’s investment banks and trading companies to take control of massive positions in commodities markets called swaps held by Lehman Brothers and AIG.

The result: Oil prices spiked by a whopping $16 per barrel on Monday, the largest single-day rise in oil prices ever.

“If speculators were forced to liquidate their positions, oil would easily be $65 to $75 per barrel by the time the liquidation was complete,” said Michael Masters, the founder of Atlanta-based hedge fund Masters Capital Management. Tuesday, oil was trading at $108.74 in midday trading in New York.

So while Lehman Bros and AIG filed for bankruptcy (to evade creditors), and got a massive bail out from Uncle Sam, they were busy jigging the system so, well, so your gas cost more and they lost less.  Meanwhile their chum in the game, Mr Paulson, former CEO of JPMorgan, where he picked up a measly 700 million in pay and departure bonus, and has a “blind trust” holding a little 500 million in JP stocks for him (real blind this one), offered up his dump-it-all-on-the-public opening gambit, so whatever rip-off is voted on and passed will smell like roses, however noxious it really is.  So far none of the “compromises” have actually meant much, but the net and the MSM are full of fulminations about the yahoo mentality of those who pressed so hard outside that enough threatened congressmen voted no, if only for the moment.  I guess the idea is that if this is done in pieces, when the full quadrillion bucks of funny derivatives leverage paper is covered, we won’t have noticed.  Ha ha….

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