February 6: Daily Contrarian Reads

The Delusion That Wind And Solar Will Save Us

The “Wind and Solar Will Save Us” story is based on a long list of misunderstandings and apples to oranges comparisons. Somehow, people seem to believe that our economy of 7.5 billion people can get along with a very short list of energy supplies. This short list will not include fossil fuels. Some would exclude nuclear, as well. Without these energy types, we find ourselves with a short list of types of energy — what BP calls Hydroelectric, Geobiomass (geothermal, wood, wood waste, and other miscellaneous types; also liquid fuels from plants), Wind, and Solar. Unfortunately, a transition to such a short list of fuels can’t really work. These are a few of the problems we encounter…

The Purpose of Decadence and the Pleasures of Coercion

I guess you’ve noticed by now that the center didn’t hold. Instead of a secure platform for political premises like tradition, precedent, rationality, and cultural norms, you see a fiery maw of sheer emotion between the camps of the so-called Left and the so-called Right.I say so-called because the campus Left and the Trump Right have escaped the categorical corrals they formerly occupied. And they may have left their customary official parties stranded and dying too. It may be fatuous to say whether that is a good or bad thing; it just is, for the moment. They are two halves of a polity so broken and so far apart that it is also hard to see how they might ever come back together into a consensus about how a society might operate successfully.

As Federal Debt passes $20 Trillion, Trump needs to fight for Spending Cuts

As I write this piece, our total debt is about to pass the $20 trillion dollar threshold. That’s twenty trillion: a 20 followed by 12 zeros. $20,000,000,000,000. No matter how you put it, that’s a lot of debt….In other words, no matter how you look at it and which number you pick, it’s a lot of red ink produced by years of overspending. Unfortunately, debt will continue to accumulate in the upcoming years with gross debt reaching $30 trillion and public debt growing to $24.9 trillion in 2027, according to CBO.

GE, Boeing, Oracle form coalition to support Republican border tax

U.S. companies including major exporters General Electric Co and Boeing Co launched a coalition on Thursday to back a House Republican plan to tax all imports, saying the proposal would “support American jobs and American-made products.” The group, comprised of more than 25 U.S. companies and dubbed the “American Made Coalition,” also includes Dow Chemical Co, Eli Lilly and Co, Pfizer Inc, and Oracle Corp, the companies confirmed. The group’s launch underscored a growing division in corporate America over the House Republican proposal that would cut corporate income tax to 20 percent from 35 percent, exclude export revenue from taxable income and impose the 20 percent tax on imports.

An Economic Showdown is Looming

The Keynesians and the Capitalists are heading for an economic showdown at the O.K. Corral. Keynesians believe the central government should control the economic levers affecting the masses. The economy can’t be entirely left up to the free market. Big government believers want the “leaders” determining the winners and losers. Controlling reallocation of wealth preserves the power of the political class. Using tax dollars to garner votes has turned into an art form.George Bernard Shaw said, “A government that robs Peter to pay Paul can always depend on the support of Paul.” US Governmentspending.com “guesstimates” 2017 spending on welfare and Medicaid will top $1.127 trillion. While the welfare class grows, Peter is working his butt off and sees a lot of his hard earned money wasted.

The Student Loan Problem Is Far Bigger Than Anybody Thinks

The Department of Education recently released a memo admitting that repayment rates on student loans have been grossly exaggerated. Data from 99.8% of schools across the country has been manipulated to cover up growing problems with the $1.3 trillion in outstanding student loans. New calculations show that more than half of all borrowers from 1,000 different institutions have defaulted on or not paid back a single dollar of their loans over the last seven years.

How My Trump Bubble Burst

The bubble burst. My fantasy died. I wasn’t a big Donald Trump backer—on TV I have called him a bully, a narcissist, etc.—but his first days were thrilling! Finally, a president who meant it when he said he’d cut red tape that kills growth, a man who mocks political correctness and sneers at leftist reporters. Finally, an executive choosing good people: Andy Puzder, Scott Pruitt, Betsy DeVos, Mick Mulvaney, Mike Pompeo… But then he broke my heart. His immigrant ban is bad. I won’t write about it until I know more. But even before that, he said he’d impose a 20 percent tax on Mexican imports, and he trashed trade by insisting that “we want the (Keystone) pipe to be manufactured here!”

Trump Will Make Volatility and Uncertainty Great Again

It is also about the growing probability and my strengthening view that President Trump will make market volatility and uncertainty great again. If you take the position that our new administration’s policy and conduct are not essential ingredients for the health of our capital markets, then you are simply not a student of market history….

The January Jobs Report—-A Statistical Monstrosity

In reality, the payroll reports are statistical monstrosities, a Frankenstein’s monster of so many different regressions, normalizations (trend-cycle), and benchmarking. The benchmarking process is supposed to create more robust data, and that can be the case, but it can also make a further mess of things. When I write that I believe (still) that the BLS overstated the employment figures especially in 2014, it is often met with disbelief (especially from the media) as if that were ever possible. The payroll report for January 2017 was an almost perfect storm exemplifying all these weaknesses hidden in plain sight.

The CIA’s New Deputy Director Ran a Black Site for Torture

Beyond all that, she played a vital role in the destruction of interrogation videotapes that showed the torture of detainees both at the black site she ran and other secret agency locations. The concealment of those interrogation tapes, which violated both multiple court orders as well the demands of the 9/11 Commission and the advice of White House lawyers, was condemned as “obstruction” by Commission Chairs Lee Hamilton and Thomas Keane. A special prosecutor and Grand Jury investigated those actions but ultimately chose not to prosecute. That CIA official’s name whose torture activities the Post described is Gina Haspel. Today, as BuzzFeed’s Jason Leopold noted, CIA Director Mike Pompeo announced that Haspel was selected by Trump to be Deputy Director of the CIA.