4/29/2010

Club Med and the Lessons of History (or, What am I talking, Greek?)

GREEK CRISIS: A serious debt crisis in Greece has rattled global financial markets and raised worries about whether other countries will be able to repay their debts.

LEHMAN REPLAY: Economists are worried that the Greek crisis, if not contained, could turn into a repeat of the cascading financial panic that occurred in the fall of 2008 after Lehman Brothers collapsed.

DEBT RESCUE: European countries and the International Monetary Fund are racing to assemble a package of loans for Greece that will be sufficient to convince markets that the country will not default on its debt obligations.

Concerns have already surfaced in Congress that the broad demands of the sovereign debt crisis will quickly exhaust the I.M.F.’s reserves and leave the United States, the fund’s largest shareholder, with the bill.

Professor Nouriel Roubini, the New York-based academic who was one of the few to anticipate the scale of the US financial crisis, told a panel in California that the buildup of debt is likely to lead to countries defaulting or resorting to inflation to ease the burden on their populations.

“While today markets are worried about Greece, Greece is just the tip of the iceberg,” he said., “ The thing I worry about is the buildup of sovereign debt.”

The whole idea that the financial crisis was over is being called into doubt. History shows us  that the Great Depression bottom was the sovereign debt default phase. And the EU's erratic responses (hesitancy followed by “lip service” rather than decisive responses) is going to prove even more detrimental as this "Club Med" crisis grinds on.

The Great Depression was composed of two separate panics.  In 1930 people thought they'd seen the worst of things. 

But the economic conditions created by the first panic were already eating away at the foundations of financial institutions and governments.   This is one of the reasons that we had a second banking crisis, which pushed America to the real bottom of the Great Depression, and brought FDR to power.

The euro is in crisis, and already-weak European banks appear to be massively exposed to Greece's huge debt load.  They're even more exposed to the debt of the other Eurozone countries – Spain, Portugal et. al., which is far too large for it all to be bailed out.  The size of the rescue package that Greece needs is already going to take a substantial chunk of the IMF's war chest. And the IMF is, basically, the United States.

It's not clear that Greece has the political will for the austerity measures it's going to have to make even if its debt yields come back down--and the higher they stay, the smaller the chance.  This is  the calculation its creditors are making, which is why yields are now in the 20% range.  And, perversely, this  makes it more likely that creditors are going to lose their money.

A friend of mine from California, who is a successful investment manager and a multi-year disciple of Warren Buffet, thinks the entire idea of the Euro is idiotic: a fiat currency held by all members of the club.

Robert says, “In the “old days”, Greece could simply have devalued the drachma. Now, of course, they can’t devalue and so the reality of a “social democracy” such as the European Union is now exposed. In fact, what you have is an entire European Union that has borrowed from the future.”

The demographics are such that the concept of “ Europe ” per se is completely moribund. There is no future for Europe under the present circumstances.

Just as Greece is unwilling to undertake “austerity measures” ( i.e., stop borrowing and living on credit) the culture of Europe (which includes Great Britain but excludes Russia) is unwilling to do what is necessary; which is:

1.Unplug the Euro and return to sovereign currencies.
2.Stop all forms of deficit spending  (as in “do not spend more than you take in”)
3.Start procreating so that the population replacement ratio is reached  (which may be impossible, as well as too late).


Robert continues, “Thus, the IMF (read,  “USA” ) will ultimately bail out Greece since the Germans see the obvious injustice of raising taxes in Germany to pay for the profligate Greeks. In the USA, we are too stupid to see this, so Obama and Company ( the Idiot Geithner, The Fool Summers, etc) will, for political reasons, continue to raise taxes until all of the expendable income of the upper 5% is attached to support causes like the IMF (internationally) and Big Government (Unions, healthcare, etc) domestically.'”

The same morbidity applies to us except that, for the moment we are still standing (albeit not very tall).

You know what? I think my friend is right. We’ve got a very big problem on our hands, and we are indeed headed for a real double-dip recession. We’ve built a global house of cards. If that house comes down, it’s going to be very painful for a long, long time. How about it, Keynesians? Don’t tell me you plan  to print even more money to solve the world’s economic problems, because IT DOESN’T WORK.

4/23/2010

Obscene Wealth – Myths About Capitalism

Recently I tweeted a quote from John Stossel (who was quoting Michael Medved):

"If you believe that when the rich get richer, the poor get poorer, then you believe that creating wealth causes poverty, and you're an idiot"

This is the old zero-sum fallacy, which ignores that when two people engage in free exchange, both gain -- or they wouldn't have traded. That’s the way business works.

I received a number of responses to that tweet, mostly espousing the leftist concept that Capitalism is bad and somehow that the concept of getting wealthy is “obscene” and it seems to occur “at the expense of others”.

When does wealth (or the creation of wealth) become "obscene"? Is there some measuring stick we can hold against it with a red line on it that says "Obscenity Level"? Or is it just somebody's subjective, biased jugement?

Other responses seemed to focus on the "deductive argument" logic of the statement, completely ignoring the point (and further indicating the difficulty some people seem to have with this concept)

One only needs to look at the recent recession to see the corollary that when the rich get poorer, the poor certainly don’t get richer.

Then there are those who claim, for example, that Walmart comes in and wipes out local grocers and other businesses. Obscene Wealth? Maybe, but they also bring new jobs to the community. That’s capitalism. If you try to regulate this kind of thing, you don’t make any improvements. All you do is create more Socialism and Collectivism – the hallmarks of the current Obama Adminstration. More regulation, more big government programs and agencies, and printing five times more money in one year than predecessor Bush did in two terms of office. Not that Bush was any angel- he almost singlehandedly dismantled Reaganomics, virtually assuring an economic collapse of one sort or another.

The bottom line is, this is one of the biggest lies -- the idea that because of capitalism, we're all suffering. Poor people in America today -- people who are officially in poverty -- have a higher standard of living in terms of medical standards, the chances of going to college, the way people live -- than middle-class people did 30 years ago. It's an extraordinary achievement of technology and of the profit sector, and it comes from the creation of wealth by hard - working entrepreneurs.

Here’s the thing: Capitalism works. It’s worked just fine in the US of A for over 250 years. If it ain’t broke, then don’t try to fix it.

4/11/2010

Internet Explorer: Flash "1 item remaining" - Movie Not Loaded

A couple of days ago I started having an issue where if I’d go to Youtube.com to look at a Flash movie, I’d get to see only a black screen in the movie area. A right – click on the movie and I’d see “Movie not loaded”. In addition, the browser status bar reports “1 item remaining” – basically meaning, “I’m waiting for this movie to load”. Of course, this never goes away.

You might be tempted to uninstall the Flash plugin or try any number of fixes including changing your Internet Explorer security settings, among other "tricks". Don't do it. Try this first. Here’s how I fixed it:

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In Internet Explorer, choose “Tools / Internet Options”. In the Browsing History section, click the “Delete” button and you should see a dialog like the above. Note that I have checked the History and Temporary Internet files checkboxes. Click Delete at the bottom and that should fix it. If that doesn’t work, do it again but this time uncheck the “Preserve Favorite website data” Item and click Delete again.

Works for me!

4/09/2010

Fix Uninstall Issues with Visual Studio Versions

Have you ever installed a BETA or CTP or an RC build of some Microsoft product such as Visual Studio, and then been faced with the unhappy situation that it could not find the installation sources when you attempted to uninstall the product, or it just didn’t uninstall “cleanly” – leaving traces of Registry entries that prevented you from installing a later version?

It’s certainly happened to me several times. But today I ran into a program called Perfect Uninstaller that, for $35, turned out to be one heck of a bargain. Perfect Uninstaller has three modes to completely and totally uninstall any program.

It starts out using the regular Windows Installer, but it doesn’t stop there – even if the installer says “I can’t find the MSI source for this”, it doesn't give up like the Windows MSIEXEC installer would do -- it picks up all the Registry Entries by scanning the Registry, and then it picks up all file traces by scanning the filesystem.

The result is a 100% complete and total uninstall of the most difficult programs – programs for which the sources may be long gone and extremely difficult to find. I don't usually make it a practice to "promote" some piece of software, but in this case I'm going to make an exception. This thing works, and it works well!

Today I used Perfect Uninstaller to remove at least 10 different components of a previous Visual Studio BETA build that up to now absolutely refused to go away, and it worked flawlessly on every single one.

If you like to live on the edge and install beta software on your primary development machine, or you just have errant software that you cannot seem to get rid of, then this little proggie is for you!

I’m now a happy camper! Go try Perfect Uninstaller yourself. Dr. Dotnetsky sez, “This one really works!”. You'll thank me later.

A final note: On Monday, April 12, Visual Studio 2010 RTM will be launched at the Bellagio in Las Vegas. My MVP Lead P.J. Forgione has a post describing what some MVPs are doing at the launch event and around the world. MVPs who will be speaking at the event include Billy Hollis, Brian Noyes, Brian Randell, Carl Franklin, Christian Wenz, Dan Wahlin, Hadi Hariri, Joel Semeniuk, Jon Flanders, Juval Lowy, Scott Allen, Kathleen Dollard,Mark Miller, Markus Egger, Michele Bustamante, Paul Litwin, Richard Campbell, Richard Hundhausen,
Rockford Lhotka, Shawn Wildermuth, Steven Borg, Steven Smith, Tim Huckaby, Todd Anglin and Bob Beauchemin. I don’t know how many of these folks will need this Perfect Uninstaller thing like I did, but they all deserve a round of applause, because Visual Studio 2010 really rocks!