Friday, April 29, 2011

"...make any Thing but gold and silver Coin a Tender in Payment of Debts..."

From Hemmoreuters, via Yahoo! news: Inflation increases, economy slows. In a related story at Yahoo! finance, here are 9 areas where inflation is affecting consumers the most:

1. Beef
In a revised forecast Monday, the U.S. Department of Agriculture said consumers will see higher price tags on ground beef and steak, projecting 6% to 7% increases year over year. That's up from a previous forecast of just 4.5% to 5.5% inflation for beef prices. Beef prices have surged in the last several months as supplies shrink, exports boom and grain costs soar.

2. Pork
Don't think you can just switch from cow to pig to avoid this trend — pork could see retail price increases of as much as 7.5% over 2010 levels according to the USDA.

3. Grains
Even going vegetarian is more expensive than it was a year ago. Corn prices have doubled, from $3.49 a bushel in July to well over $7.70 currently. Wheat prices have rolled back a bit in recent weeks, but topped 2008 highs in February to set a new record and remain very high currently.

4. Gasoline
The average U.S. price of a gallon of gasoline has jumped about 12 cents over the last two weeks to $3.88, with the highest average price for gas tallying $4.27 in Tucson, Ariz. This is with oil at $112 a barrel — if crude prices reach 2008 peak levels of $145, four bucks for gas may seem cheap.

5. Copper
The price of copper at the end of 2008 was just $1.30 per pound. Currently, copper is trading around $4.30 after setting a record of $4.60 in February. Unlike gold and silver, which are largely used in luxury goods or as investments, copper is used in a wide range of household items — from electrical wiring to air conditioners to water pipes.

6. Diapers
Consumer-products company Procter & Gamble PG (NYSE: PG - News) said this week that list prices for Pampers are up 7% on average over last year, with even Pampers wipes up 3%. To be clear, that's not a retail price hike, just a cost increase to stores. Retailers will decide how much of those price increases to pass along to shoppers. Kimberly-Clark KMB (NYSE: KMB - News), maker of Huggies, said Monday it plans to raise prices for similar reasons — rising costs for the petroleum products and paper pulp that go into the diapers. It will be the third such announcement for Kimberly-Clark since the middle of March.

7. Paper towels and toilet paper
If you don't have infants, you're not off the hook. P&G also said that Charmin toilet paper and Bounty paper towels are both listing for 5% more now with retailers and distributors than they were a year ago. KMB's diaper price update will also be accompanied by a boost for its flagship Kleenex tissues.

8. Shipping surcharges
Freight shipper United Parcel Service UPS (NYSE: UPS - News) will be hiking its fuel surcharges from 7.5% to 8.5% as of May 2 for ground freight and from 13% to 15% for air freight. That really hurts small businesses. If you are a storekeeper simply trying to keep your shelves stocked, you have no choice but to pay more and endure smaller margins — or hike prices yourself and add to this inflationary mess.

9. Wages
Perhaps the most insidious factor of our current inflationary spiral is the fact that while all these other items are costing more, household purchasing power is shrinking because wages and salaries aren't keeping up. While the consumer price index rose 2.7% in March to clock the fastest 12-month pace since December 2009, a staggering 18.3% of personal income is now made up of food stamps while wages account for just 50.5%. That's the lowest since the government started keeping records in 1929.
In addition to copper, all metals, especially gold and silver, are at or near record high prices. Our government has already debased our paper money, and all of the metal value in our coins except one: the nickel. Since 1866, the nickel has been made from a nickel and copper alloy, at 75% and 25% respectively. That means the melt value of the nickel today is around $o.o72, 40% or so above face value. Compare this to the Sacagawea "dollar," made of god-knows-what metal, which has a melt value of $0.073, or only 7.3% of face value. How long will the nickel continue to be minted in this state? With the production and shipping cost of each nickel at almost ten cents each, my guess is not long at all.

Monday, April 25, 2011

Beer Geek

Despite its title, this is not a "Beer Blog."

Octuple IPA at 15% Alcohol and 700 IBUs!  What would a stonger version be like?
And what the hell is a quintuple double trouble BFK mother fucker lickin plucker trecha boochie boochie bingo bongo mambo ricky ricardo vaillarto petite brand holy freaking potato juice single lane butt plug belgian sour with a triple axel and a splash of lime?

Can We Try This in the United States Congress?

Mark Levin played the following clip last night, from about two years ago. Imagine, if you will, sometime in the near future, the Republican nominee using these words to confront Dear Leader Chairman Maobama. Is there any question who would win? Any doubt at all that Mr. Obama would be handed his hat, and his ass as well?

Thursday, April 21, 2011

Silver and Gold

The price of gold will likely close above $1500 today. It has been breaking record highs every couple of days recently. Silver is almost $46 an ounce right now, just a few dollars short of its all-time high from 1980, when the Hunt brothers tried to corner the market.

What does this say about our fiat currency Federal Reserve Notes? They are federal notes, all right. But there is no "reserve" except for more federal notes. Increasing the number of "dollars" in circulation serves only to dilute the value of existing dollars, the very definition of inflation.

I am encouraged by the potential minting of State coins in gold and silver, especially in the Commonwealth of Virginia. Dear reader, before you say "Your stupid," consider Article I, section 10 of the U.S. Constitution. It reads, in part, "No State shall...make any Thing but gold and silver Coin a Tender in Payment of Debts..."

Paper money is a joke without gold or silver to back it up. History is littered with examples of the failure of fiat currency.

Tuesday, April 12, 2011

Free to Choose

Why is it a big deal to cut a few billion dollars when debt and deficit are in the trillions? Why is a government shutdown (in name only) a horrible tragedy? Why do the Republican leaders complain that they only control 1/2 of 1/3 of the government, when they are 100% in control of spending? Why does the Republican leadership pound its chest about fiscal responsibility, and then go along playing the same Washington games? How did a wuss crybaby like Boehner ever become Speaker of the House? Why does the President, making a bizarre live break-in to the 11 p.m. news, not address the nation from the Oval Office? The only way to end junky behavior, if the junky will not do it himself, is to cut him off from his junk. Our federal government needs an intervention. And that is what the Tea Party has been, regardless of the claims of the freakish left. The Tea Party wants to end the exponential growth of debt and deficit, and the inevitable taxes and government intrusion that will follow hard upon. It is not too late to put on the brakes. In their great book Free to Choose, Milton and Rose Friedman propose that a Constitutional Amendment is the best way to limit government and its spending. Here is the text of their amendment (any transcription errors are mine):
January 30, 1979 Washington, D.C.

A PROPOSED CONSTITUTIONAL AMENDMENT TO LIMIT FEDERAL SPENDING Prepared by the Federal Amendment Drafting Committee W. C. Stubblebine, Chairman Convened by The National Tax Limitation Committee Wm. F Rickenbacker, Chairman; Lewis K. Uhler, President

Section 1. To protect the people against excessive governmental burdens and to promote sound fiscal and monetary policies, total outlays of the Government of the United States shall be limited.

(a) Total outlays in any fiscal year shall not increase by a percentage greater than the percentage increase in nominal gross national product in the last calendar year ending prior to the beginning of said fiscal year. Total outlays shall include budget and off-budget outlays, and include redemptions of the public debt and emergency outlays.

(b) If inflation for the last calendar year ending prior to the beginning of any fiscal year is more than three per cent, the permissible percentage increase in total outlays for that fiscal year shall be reduced by one-fourth of the excess of inflation over three per cent. Inflation shall be measured by the difference between the percentage increase in nominal gross national product and the percentage increase in real gross national product.

Section 2. When, for any fiscal year, total revenues received by the Government of the United States exceed total outlays, the surplus shall be used to reduce the public debt of the United States until such debt is eliminated.

Section 3. Following declaration of an emergency by the President, Congress may authorize, by a two-thirds vote of both houses, a specified amount of emergency outlays in excess of the limit for the current fiscal year.

Section 4. The limit on total outlays may be changed by a specified amount by a three-fourths vote of both Houses of Congress when approved by the Legislatures of a majority of the several States. The change shall become effective for the fiscal year following approval.

Section 5. For each of the first six fiscal years after the ratification of this article, total grants to States and local governments shall not be a smaller fraction of total outlays than in the three fiscal years prior to the ratification of this article. Thereafter, if grants are less than that fraction of total outlays, the limit on total outlays shall be decreased by an equivalent amount.

Section 6. The Government of the United States shall not require, directly or indirectly, that States or local governments engage in additional or expanded activities without compensation equal to the necessary additional costs.

Section 7. This article may be enforced by one or more members of the Congress in an action brought in the United States District Court for the District of Columbia, and by no other persons. The action shall name as defendant the Treasurer of the United States, who shall have authority over outlays by any unit or agency of the Government of the United States when required by a court order enforcing the provisions of this article. The order of the court shall not specify the particular outlays to be made or reduced. Changes in outlays necessary to comply with the order of the court shall be made no later than the end of the third full fiscal year following the court order.

Here are some others from their book:
Congress shall make no laws abridging the freedom of sellers of goods or labor to price their products or services
Bye bye, minimum wage laws. Labor unions would have a fit over that one.
No State shall make or impose any law which shall abridge the right of any citizen of the United States to follow any occupation or profession of his choice.
Or simply,
The right of the people to buy and sell legitimate goods and services at mutually acceptable terms shall not be infringed by Congress or any of the States.

Thursday, April 07, 2011

Herman Cain for President

From '93, smacking down Bill Clinton on the issue of nationalizing health care:

And more recently, channeling Paul Atreidies: