Tuesday, November 30, 2010

So Much to Blog... So Little Time

I'll spare you the Thanksgiving story... I traveled for the holiday, and in my own OCD way, I studied my fellow man as he/she passed me by... OMG.... are the American people ever fat!

We all tend to look to the far off for trouble in ours lives... Peak Oil, Iran (well, that IS real trouble), the monetary system, deficits... turns out McDonald's and Coca-Cola were the enemy within (don't miss this excellent article).

The people I took in on my travels are not in any condition to compete with workers in China or Viet Nam... or even Mexico (now that is embarrassing)!  The people I observed were in no condition to put in a full day in a factory or on a farm... many of them had a hard time negotiating the curb in front of the airport.  A country is NOT its borders, nor its political leaders (thank goodness)... it is its people.  Our people have been misled (or have misled themselves) into thinking that eating themselves into oblivion is somehow acceptable.

I can speak only from my experience.  I bought a small farm nearly 5 years ago.  I live half the year on the farm and half in South Florida.  While on the farm, by my best guess about 80% of the calories I consume come from my production on the farm, and in Florida I live an industrialized lifestyle complete with contrived exercise routines (no need for contrived exercise routines on the farm). Within a month of leaving the farm I usually put on 8 to 10 pounds (and that's with me really watching my intake like a hawk), I am softer, and I don't fall asleep the moment I hit the pillow.  After a month back on the farm, I have the makings of a six pack (sort of... for a guy my age... ok, its not that close but it ain't that far), and I feel like a million bucks.  I eat eggs, full fat milk and cheese, butter, bacon every day with breakfast, and at least one full serving of beef or pork at lunch or dinner (all grass fed and raised on my farm)... and I am lean, my cholesterol, blood pressure, and resting heart rate are excellent... and my love life is like a newly wed.

This is not to say that I don't miss walking out my door and down the street to pick up a pizza like I do in Florida, or any of the million other conveniences that city dweller's enjoy... I do (and my wife misses them a great deal more than I do)... but just maybe our lives were NOT supposed to be all that convenient, at least as far as our health is concerned.

Recently Matt Simmons passed away.   A few years prior, Bruce Wasserstein died suddenly of a heart attack.  Most of you know Simmons and likely none of you ever heard of Wasserstein.  Wasserstein was a legend on Wall Street and my personal hero; an investment banker that would have made J.P. Morgan (the man) look slow and dim witted... yet he was not smart enough to notice that he looked like a train wreck waiting to happen, and he died of a massive heart attack at the age of 62 with $800 million in his check book... both of these guys spent too much time at the office, and not enough time doing manual labor, drinking wine, and making love (in my opinion... after all, I wasn't there in their bedroom... but a huge gut is not usually indicative of lots of great sex)... and were likely addicted to the "action" that came  with their jobs as "masters of the universe".

And I understand.  I miss that "action".  But I'd rather live.

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President Obama took a pretty good symbolic baby-first-step in freezing Federal Pay... BHO does NOT have to go down in history as another Hoover or Carter... even if he were to wind up a one term president.  BHO can take this opportunity and go down in history as one of the great presidents... what we face now is just as significant a threat as that faced by Lincoln or FDR... history won't give a good fart about Pelosi, et al... it will judge BHO... maybe, just maybe, the President has his ear to winds of history... if he does, this would be an excellent time to sacrifice your political career, Mr. President, and bring those that want to destroy our country from within to their knees.  If you do, you will be remembered as one of the Great Men of American history... if you do not, you will be an unpleasant foot note... I hope you accept the mantle of the former.

The Following was taken from an email I received from the firm where my good friend and Rabbi (he is a real Rabbi) Mo Silver hangs his hat and was written by Keith R. McCullough:

"You never see the old austerity. That was the essence of civility; young people hereabouts, unbridled, now just want."
-Moliere
 That's an old quote from a famous French playwright who has long been dead. "Moliere" was Jean-Baptiste Poquelin's stage name. His urban legend was born when he collapsed and died in the middle of a play in 1673. He was 51 years old.
 I'll take some editorial liberty this morning and evolve Moliere's quote for the Age of American Millenials and Baby Boomers: 'You've never seen austerity. That was the essence of our grandparents; Millenials and their parents, unbridled, now just want.'
 This is obviously a generalization but, in principle, I can't imagine that an analyst from outer-space wouldn't see the hypocrisy in Americans door busting each other on Black Friday for i-Pads at the same time as their Congress fights to keep interest rates on my savings account at zero percent as a result of an alleged depression.
 Want, want, want. What can I get out of this market? Pretended Patriotism be damned, what's in this for me?
 The good and the bad news on this front is that we have leaders in this country who can enforce change. Some of that change is going to be slow. Some of it is going to hurt. Some of it is needed or what you're seeing in European stock and bond markets is going to be playing at an American "Lifestyle" Center near you in 2011.
 In proposing a 2-year pay freeze for US Federal employees, President Obama did the right thing yesterday in implementing the first stage of what we have been calling for since July of 2010 (when we were short the US Dollar on reckless government spending). Our Q3 of 2010 Hedgeye Macro Theme was titled "American Austerity" and we think that fiscal conservatism is the only path to US Dollar driven prosperity.
 The debauching and devaluation experiments of the Big Government Interventionists have been tested and tried. From Japan to Europe and back home again, they have not worked. We need to fix these deficit and debt to GDP ratios, or the global bond market is going to fix us.
 This morning you are seeing Greece's stock market test its lows from June 2010 when the European Fiats made a conflicted and compromised promise to the world that Piling more short-term Debt-Upon-Debt was the elixir of life. Apparently 8 centuries of Reinhart & Rogoff data has once again trumped political storytelling. This time isn't different.
 Why me? Why now? Shouldn't this be someone else's problem?
 I get that line of thinking, but I also get what wearing a team jersey means  - and, as legend USA Hockey Coach Herb Brooks said:
 "You're looking for players whose name on the front of the sweater is more important than the one on the back."
 Back to the construct of our intermediate-term global macro forecast...
1.       Growth Slowing
2.       Inflation Accelerating
3.       Interconnected Risk Compounding
 We don't have a choice but to do this now. European and Emerging Bond markets are telling you this and so are American Bond yields:
 1.       European Sovereign Debt Yields continue to make a series of higher-highs as concerns push rightly towards Spain and Italy. 
2.       Emerging Market Debt just had its worst month in 2 years (NOV down -2.9% on the EMBI Index with Brazilian and Russian weakness).
3.       US Municipal Debt funds just flashed their 2nd consecutive week of outflows, taking the 2-week total to north of $5 BILLION.
 Yes, we recognize that a BILLION or a TRILLION dollars isn't what it was to our grandparents, but these are still big numbers to consider on the margin. Remember, everything in global macro that matters happens on the margin.

Europe is unwinding at this very moment.  Can anything be done?  Probably not to save the European Union... let those of us on this side of the Atlantic take a long hard look in the mirror and turn our attention to our own Union and our own Republic.




6 comments:

Stephen B. said...

The US' weight problem is really going hyperbolic. While we've been putting on weight ever since I was a kid (born 1962 here), it seems to me that waistlines have gone up (out?) by a third or more just in the past 10 years or so.

The combination of processed foods and urban/suburban lifestyles that leave one nothing to do except sit around, drive around, shop, or sit and play with electronics is really going into overdrive in these final few years, putting the fat on Americans.

Happily, I too have escaped that misfortune of obesity through a combination of life interests and activities, but I've seen it in nearly everyone else around me. (I had a 30-31 inch waist at HS graduation, and now have a 31-32 depending on the brand of jean I've got on. 'Used to be 145 then, 160ish now.)

I am closing on a 55 acre farm in Maine next month too, so I guess I won't be getting any fatter, hopefully.

The US' weight problem will start to rectify I think, but the process will be brutal.

Greg T. Jeffers said...

Stephen:

I wasn't suggesting I was "body-beautiful"... I have to watch my weight very closely when I am not working around the farm.... I am a year older than you, and at our age it just is what it is... but for the American people to once again become competitive... we will need to change food and Ag policy and change the health of the American people... because clearly, they are NOT going to to it themselves.

Greg T. Jeffers said...

My older brother had a farm in Maine when I was a kid (he is 13 years older). I used to sped time there in the summers, and it never left me (obviously).

I went south because I hated the winters... but I miss the sea food!

Greg T. Jeffers said...

BTW... I have been "fat" a couple of times in my life. Thankfully, I caught myself... but I don't have to worry about it much when I am on the farm... it seems that the industrialized lifestyle does not suit me... and that could also be because I succumed to all of the temptations that come with that lifestyle even though I KNEW to look out for it... what chance does a person who IS NOT looking out for it have?

kathy said...

I had to laugh at your post. I love to eat but I also work like a mad woman and still I don't get everying done. If I ever gave up this little piece of land, I would have to move someplace with extra wide doors as I too love whole milk and bacon. Thank goodness I don't have resort to actual exercise. I am way to lazy for that but I don't mind carrying 6 gallon buckets full of compost around.

Dextred1 said...

The problem is that of conspicuous consumption. We are marketed and propagandized to worship material things and money. This idolatry of money is much different than the capitalism that we talk about so much.

“You shall not covet your neighbor’s house; you shall not covet your neighbor’s wife, or male or female slave, or ox, or donkey, or anything that belongs to your neighbor.”

~ 10th commandment

I have been stewing on this for a while and I think that the things that make a traditional capitalist system are dead (savings, low tax rates, freedom of choice, low government interference, frugality) and what we have now is a world based on the idea of instant gratification. The culture, government and people have now made their motto "buy what you don't need with what you don't have". Proverbs has a quote perfect for this idea “the borrower becomes the lenders slave”. We are in financial bondage, our symptoms are obvious, first discontentment, second indebtedness, third constant pressure (anxiety or worry about debt); fourth is the desire for help which pushes people to the worst schemes and individuals. The people are here, the states are here and soon, very soon the feds will be here. The feds are already at stage four (injecting printed money, stimulus, deficit spending, and on and on and on).

As for physical labor, I love working construction for the same reason you like your farm. Stay in shape, sense of accomplisment, emotional release and fellowship with my crew. Don't forget fresh air and sushine, at least sometimes for the sunshine.