The photo to the left may give you some clue as to where we’re off to – and believe you me, it’s a good place to blow off some steam.

Play safe, True Believers.

Our Economic Council.

This being an election year, a great deal of bloviating is going on about economic issues.  The problem is, most people – at a rough guess I’d say 98% – don’t understand economics very well.  Well over half don’t know their butts from their faces about economics.  That is, to some extent, understandable; it’s not taught in the schools, and most people don’t get any in college.  I have studied it, partly because several micro- and macro-economics courses were required for my MBA, and partly because I find it interesting.  I’ve read economics works ranging from Smith to Keynes to Von Mises to Marx to Friedman to Sowell, and have come out of it with probably a better-than-average grasp of how economies work, and as an adherent to the Austrian school.

Doing the Math.

This year’s election is centering pretty firmly on economic issues.  That’s partly because the economy isn’t doing very well.  Europe is swirling around the fiscal drain, and recent elections in France and Greece appear to be putting the lunatics in charge of the asylum – sort of like California did in 2010.  Here in the States, political pundits of every stripe are arguing whether or not the recession of 2008 was or was not worse than the recession of 1979 – 1980.  So, which was worse?

Unlike a good portion of today’s electorate, I remember the 1979-1980 recession, but my memories are no doubt tinged with the fact that I was young and, like many young people, chronically short of cash.  So, instead of relying

The Seventies weren't easy times, but there were compensations, such as the increase in the Redhead Index.

on my perceptions, let’s do the economics thing and look at the numbers.

A common indicator used by economists is the Misery Index, which is derived by adding the unemployment rate to the inflation rate.  In 1980, at the end of the Carter Administration, that index stood at 19.72.  In the fall of 2008, it was 7.49.  (Sources:  U.S. Department of Labor, InflationData.com)  Note that the most recent data available, for March 2012, gives the Misery Index as 10.85.

Using this standard, 1980′s recession was worse.

Let’s look at unemployment rates alone.  In the fall of 1980, the unemployment rate was 7.2%.  In the fall of 2008, that rate was likewise 7.2%.

Using this standard, both recessions were pretty much equal.  The recoveries were not, but we’ll go into that later.

Are we underwater yet?

Next, let’s look at the inflation rate.  This is what drives the big difference in the Misery Index; in the fall of 1980, the inflation rate was 12.5%.  In the fall of 2008, it was 0.1%.

Using this standard, the 1980 recession was far worse.  Inflation did begin to peg after the 2008 election and has taken off again; again, we’ll go into that later.

Now, interest rates:  In the fall of 1980, the prime interest rate was 20.35%.  (!)  In the fall of 2008, that rate was 4%.  (Source:  Federalreserve.gov)

Using this standard, the 1980 recession was far, far worse.

A brighter picture?

So, what happened after the 1980 and 2008 elections?

Neither Ronald Reagan nor Barack Obama reacted to the economic problems perfectly. The Reagan Administration’s response was primarily based on the Austrian model, although spending and debt increased at a far higher rate than was prudent.  The Obama Administration used a Keynesian model, and Federal spending has, to put it bluntly, skyrocketed, while debt has increased to exceed GDP for the first time in peacetime.

At this point in the first term of the Reagan Administration, the Misery Index had dropped from 19.72 to 11.81, a drop of 7.91.  Today, the Misery Index stands at 10.85, as noted above; that’s an increase from 7.49, an increase of 4.32.  That has actually dropped from a high of 12.87 in August of 2011.

What is shocking about the present situation is the explosion in Federal debt, an inherently inflationary index.  The chart here only presents data through the end of 2011; the picture has gotten worse since then, and current projections of Federal spending show this disaster becoming a calamity.

What can be done?  Historically, no matter what marginal tax rates are in place, tax revenues never rise much above 18-19% of GDP.  That’s a historical hard cap.  The best way out of this is to grow our way out of it, but at present every policy of the Imperial Federal government, from tax

Looking ahead.

policy to energy policy, seems determined to drive business out of the country.

But that’s a subject for another post.

So, in summary:  By any objective economic standard, when Ronald Reagan took office in 1980, he faced an economic situation more dire than the one Barack Obama faced in 2008.  Reagan’s response was not perfect; spending increased, as did debt.  But the marginal tax rates decreased and the tax code was simplified, broadening and flattening the tax base, and this resulted in an increase in Federal revenues; the problem was, all of that was spent and more.  The Austrian model produced a far stronger recovery than did the Keynesian model.

The current Administration has doubled and tripled down on the spending side while doing nothing about our horrendous tax policy.  That needs to change, and soon.

My sexual preferences run along these lines.

By way of telling you where I sit before I tell you where I stand; three things are relevant.

1) I’m about as heterosexual as you can get.  I like women.  To my very good fortune women have always liked me.  But my attitude on matters sexual is very simple:  I don’t give a damn what anyone does, as long as they leave me alone.  I don’t make any claim to know what anyone else should do.  It’s private.

2) On social matters, like marriage, I have two primary criteria:  Will is affect me?  Does it harm anyone else?  If two men, or two women, or three women, or two men and a rosebush want to get married, it doesn’t affect me or anyone else outside of their arrangement.

3) I’m an atheist.  Arguments for ‘the sanctity of marriage’ slide off me like water off a duck’s back.  Also, we have a secular government.  Religious arguments should not enter into this picture.

My attitudes on the role of government in this matter are also not complicated.  What government does for anyone it should do for everyone or it should do for no one; and government should never interfere in people’s personal lives unless their actions cause harm to others.

I don’t think you can make an argument, other than a religious one, for the government being involved in marriage at all, except in the sense that it is a legal contract between two competent, consenting adults.  Religious arguments don’t pass muster for me personally, and they shouldn’t pass muster with the government in matters of policy.

So, with that said; what is the secular argument against allowing people to marry whoever the hell they want, presuming only that both parties are competent, consenting adults?  I’m willing to entertain the notion that there may exist such an argument, but I’m switched if I can think of what it might be.

Anyone familiar with Joss Whedon’s work will recognize the tenor of the movie.  The banter, the asides, the interplay of this team of disparate characters reminded one of Firefly, which was – until now – probably Whedon’s best work.  And Whedon knew how to play the characters right – from Captain America’s confident leadership and brilliant tactical savvy, to Iron Man’s techical genius, to the Hulk’s uncontrolled savagery.

Best bits (spoiler-free):

Hulk and Loki.

Gratuitous SMASH by Hulk of someone else besides Loki.

Captain America:  “I got that!  I got that reference!”

Scarlett Johannson - from the movie

The sandwich shop.

And – well, let’s be honest.  Scarlett Johannson.

Scarlett Johannson - not from the movie

Mrs. Animal and I don’t see many movies in theaters any more.  Too many rude people, too much advertising, too much hassle.  For this we made an exception, and it was worth every penny.

Trailers of note:  The new Spider-Man reboot looks very good, and Stallone’s Expendables II takes all the badassery and testosterone overload of the first movie and doubles down by adding Chuck Norris, Jean-Claude Van Damme and more Arnold Schwarzenegger.  Rumor had it that Stallone also considered adding Clint Eastwood, but he decided Clint would make all the other actors look like pussies.

It snows a lot in Minnesota.

It’s been a while.  The last few months at Casa de Animal have been busy bordering on insanity, what with us starting up two new business ventures and my being hit with two time-consuming projects at once.  One of those projects took me to Minneapolis for several weeks, enabling me to renew my acquaintance with that city after almost 30 years.  I had forgotten the Minneapolis – based delicacy called a “Jucy Lucy,” for example.  Also, I was briefly hoping for a return trip to America’s Own Little Caribbean Paradise, but that deal seems to have fallen through.

It doesn't snow at all in Puerto Rico.

That’s the joy of self-employment for you.

So, what’s going on in the world?  Fear not, True Believers, I’ve been busy getting clients on the straight and narrow with their quality systems and launching two new business ventures but have somehow still managed to stay current. I’m aware that there is a big movie opening today; look for a review Sunday or Monday.  In national news, I know the GOP has a Presidential candidate, which is causing some wailing and gnashing of teeth particularly among Ron Paul supporters.  (See my earlier post, Ron Paul is a Nut.)  Nevertheless I approve of the choice; now that all the shouting and waving of hands has ended, I’m satisfied with the outcome.  Now, we’ll see what happens this November.  At this point I’m thinking Governor Romney will win handily, but the election is still six months off, and that’s an eternity in politics.  Still; no parallels are perfect, but I’m seeing a lot of 1980 in this year’s election.

Moving along:  What the hell is it with New Jersey?  Granted every state has its oddballs, but this woman takes the fake-tanning cake:  A New Jersey mother has been arrested for taking her five-year old daughter tanning.  As in, in a tanning booth.  While the story is putatively about

the woman’s possible callous indifference to her daughter, the real story is the woman herself – see the photo at the link.

In a brief statement played here on Denver’s own 50,000 watt blowtorch this morning, the women in question, one Patricia Krentcil, blamed the media attention on people who are “fat, ugly and jealous.”  Jealous of what?  The woman looks like a reptile.  A hideous, sunburned reptile that has possibly been dead for several days.

There’s no accounting for some people’s outlandishness.

Some interesting science news of late:

Dino-fleas!  It’s almost enough to make one lapse into poetry (h/t to Jonathan Swift.)

How To Make Your Own Evil Twin.  I am my own evil twin.  Keeps folks guessing.  Except Mrs. Animal, who figured me out a long time ago.

Which one is the evil twin?

In monetary news:  As Bernanke and the Fed continue to debase our currency, gold may be a great investment this summer.  Disclaimer:  I am not an investment adviser nor do I play one on television.  However, I may move some more of my investment portfolio, modest as it is, into gold stocks this year.

Added note:  Debasement of a currency rarely ends well.

We do live in interesting times.

Stay tuned, True Believers; I’m not yet sure how often updates will come or what form they’ll take, but there will be more.  Hopefully sooner than later.

(The young lady pictured here is not part of the project, nor is she the source or result of any of those issues.  Her appearance here is purely gratuitous.)

Regular updates will return… eventually.  Hang in there, True Believers.

This article mirrors some of my own thoughts on what constitutes the difference between success and failure in the workplace.  From the article, the seven rules in a nutshell are:

1. Winners do things losers won’t do.
2. Winners fail more often than losers.
3. Winners are optimistic while losers are pessimistic.
4. Winners know what they’re trying to do while losers go with the flow.
5. Winners take responsibility for their own lives while losers point the finger elsewhere.
6. Winners work harder than losers.
7. Winners ask.  Losers wait to be asked.

By all means read the whole article for an explanation of these seven principles. If I were asked to add one, I would add “Winners don’t expect anyone to hand them anything.  If they want something they work for it.”  Also, a sense of purpose is vital – knowing where you are, where you want to be, and how you’re going to get there.

My own rules for success in the workplace are a tad more simple, but they’ve worked for me:  Show up a little earlier than the next guy, work a little harder than the next guy, and never pass up a chance to learn something new.

I’ve known and worked for a few self-made millionaires.  The key commonality I know of among them is that they work long hours, in some cases as many as seventy or eighty hours a week.  I’m nowhere near a millionaire myself, but I’m a reasonably successful independent businessman who has gotten along for a few years now without a traditional J.O.B., and I’m no stranger to seventy-hour weeks myself.  As Thomas Edison famously said, “Many people don’t recognize opportunity when it knocks, because it usually shows up in overalls and looks like work.”

Of course there’s an element of planning involved.  A kid who goes to college and graduates with a degree in Minority Basketweaving Studies is handicapping him/herself to an unbelievable degree.  A degree in software engineering might be worth $80-90k a year the moment the kid graduates.

Maybe it’s too much to expect common sense from some people.

In other news, I’m returning to Birmingham early Monday for two weeks, where I will be embroiled in a project about which I can not reveal any details for reasons that should be obvious.  But my initial impressions of Birmingham are positive; an old Iowa farm boy like me fits in pretty well in environs like these.  Birmingham is a small enough city to have a small-town feel, the climate is salubrious (at least this time of year) and the people are friendly.  The hotel I’m using is within about a ten-minute walk of the client, making a brisk but brief morning and evening constitutional not only possible but practical.  Best of all, since I’m going to be there over a weekend, one of the honchos in the organization has offered to take me bass fishing.  I’ve spent time pursuing trout, salmon and halibut over the last few decades, but I think it’s been close to thirty years since I did any warm-water fishing.  If the opportunity comes about I’ll grab it.

On other projects I’ve had the time to get to know an area pretty well; most of last summer in America’s own little Caribbean paradise left me very familiar with the island and the folks there, not to mention six months in Kusatsu, Japan and a year and a half in the Santa Clarita valley.  That’s one of the benefits of a career that has you on the road a lot.  This project will be brief – the next two weeks should close out my end of it.  I would have liked the chance to get to know Alabama a little better.

Happy Saturday, True Believers!  More as events warrant.

I think I might need this.    This is a 100-year old Belgian hammer double, made under warrant for Prince Albert of Belgium.    This makes it a pre-1909 gun, as that is the year that Prince Albert became King Albert I of Belgium, which title was his until he died in a mountain-climbing accident in 1934.

This looks like a fine, hand-made gun of the typically late 19th-century mold; big outside hammers, nicely engraved lockplates, hand-cut 32-line checkering.  It appears to have fluid-steel barrels, and if it has 2 3/4″ chambers it should be safe to shoot with low-brass modern ammo.  If not, black-powder loadings in 2 1/2″ length are available, if a bit pricey.  Like old cars, antique guns can be touchy to feed, but frequently worth the trouble.

The auction on this fine old piece closes Thursday.  I’m still thinking it over.

Some of the things I loved about Germany.

In other news:  Alien Abductions Aren’t Real.  Who knew?  Excerpt:

In a sleep study by the Out-Of-Body Experience Research Center in Los Angeles, 20 volunteers were instructed to perform a series of mental steps upon waking up or becoming lucid during the night that might lead them to have out-of-body experiences culminating in perceived encounters with aliens. According to lead researcher Michael Raduga, more than half the volunteers experienced at least one full or partial out-of-body experience, and seven of them were able to make contact with UFOs or extraterrestrials during these dream-like experiences.

Evidence aside, there will always be people who believe weird shit.