Friday Beaver Slide edition

Cities see tax dollars while logging companies see profits. And there nary the twain should meet.

Hard to say which came first but it's almost a safe bet loggers cut trees long before subdivisions were laid in to provide cities with coveted tax dollars. After all logs were once well taxed and provided all the revenue needed that paid for schools and roads so property taxes were cheap back then. There was the growth spurts that fueled a growing housing market. Then came the housing bubble. That was fueled in part by out of state buyers who sold their over priced homes there and moved here because we were such a bargain.

Looking back it's fairly easy to see that this was a disaster in the making. Someone should have taken note that the hillside that gave way in Oso, Wa. had been clear cut some 25+ years back. Not exactly a place you'd want to build homes but they did. No one can say for certain what mother nature will do in any given place but it's a safe bet when you fool with her she'll get her revenge. The biggest oversight here was when people ignored a six inch subsidence that happened just two years ago. That should have been a wake up call but I guess it's human nature to ignore small cracks because after all they're probably just cosmetic. Nothing to see here keep shopping.

Looking at a satellite map of the surrounding area you'll find a patchwork of clear cuts and logging roads. That will be a recipe for future disasters unless the procedures for extracting logs from an area are changed. You can't strip the land bare and expect it to be stable. You also shouldn't build near a slide area no matter how pretty the view. But once again money rules the day.

After the initial reports of cars being shredded, houses buried and 15 feet of mud and debris this has turned into a recovery operation so let's just hope no one else dies in the process of cleaning up. It's going to be a monumental task that will take months if not years.

Bank fails later....

Friday Beaver - Crazy oil baron edition

                                Can you tell me the way to the Kremlin?

The Deal

Shell ends talks with Ukraine and ExxonMobil on extracting natural gas in the Black Sea off the coast of restive Crimea.  ( In September, then president Viktor Yanukovych said Ukraine had reached a production-sharing agreement with a consortium including Shell, ExxonMobil and state-owned Nadra Ukrainy to tap gas from the Skifski site in the Black Sea. Russia plans to nationalize Crimeas gas and oil.)

In January the Shell deal was dead and the next thing you know Exxon is making a deal with Rosneft Russia's largest energy company to drill in the arctic. That deal was penned just last week as the Crimean situation was unfolding. 

The Players

This now boils down to basically two men. Putin who we know is so ruthless he even had Robert Dudly (you may recall the deepwater horizon disaster in the gulf of which he was BPs head man.) was at one time headquartered in Russia and part of BPs Russian affiliate JV TNK-BP had him poisoned, burgled and threaten with arrest.

Then there's Exxon CEO Rex Tillerson who holds the same attitude as his predecessor which is to say "I'm not a U.S. company and I don't make decisions based on what's good for the U.S." He and Putin seem to be the best of friends as Putin bestowed on Tillerson Russia's order of friendship just last summer.

The Standoff

We've seen the latest sanctions being thrown around by both sides in a game of tit for tat but there is one hold card that hasn't been played, putting oil and gas sanctions on Exxon which would be a deal killer for Putin. It would of course be a blow to Exxon who's looking for future production. All the EU can do is sit and watch as the psychopaths play games with the energy supply.

bank fails later...

Friday Beaver - They're Back!

Back from their winter hiatus and just in time for springs' arrival.

The economy or lack there of...

It was a simple and evil plan started many many years ago. Saddle someone with debt and you own them. Digging through history we find that a mortgage was only for 5 to 7 years back before the great depression era. It slowly crept up to the 30 year level and now there's even plans for a 40 year mortgage. We've even watched car loans go from 3 to 4 years to 5 or 6 and more. The asset becomes worthless long before the debt is paid off leaving the borrower no choice but to do the process all over at least with cars. Housing became a problem with an overinflated bubble that burst leaving people with more debt than house. And to finance that great ponzi scheme we had mortgage backed securities and sub prime loans sold the world over. We saw what happened when the bubble burst.

But why is the stock market so high you might ask? Part of the reason is that the Federal Reserve is pumping money in to the tune of first $85 billion and lately $65 billion a month. You could call it funny money because it never existed but this situation isn't funny. China for the most part has been holding up the world economy for the last several years but it too has reached it's breaking point. They built entire cities that now stand empty because there's no demand. They tried in 30 short years to move from an agrarian economy to an industrial one with little success as demand has slowed.

So we now stand in a great game of "bugger your neighbor" where one country asks for a bail out from another that doesn't have the money either but non the less cranks up the presses to create an even bigger burden. Eventually however this ponzi scheme of debt must end and that's usually when the lender gives up, forgives the debt and writes it off.

We've witnessed this plan first on an individual level then with companies (recall Bane Capital and their vulture techniques?) followed by cities (Detroit) and finally with entire countries (Greece Cyprus Spain etc etc.). In the process a select few have become very wealthy while the rest of us suffered. What did that select few produce? Absolutely nothing. A robbery if you ask me. But somehow they'd like you to take the blame for what they did.

A note on bank fails: During the 1930s 9000 banks failed, at present count we're at around 450. Updates later...

Friday Pussy - Ukrainian style

Ignore the insignias we're really just armed ukrainian cats on a mission.

The say the first casualty of war is the truth and while the situation in the Ukraine isn't a war yet the truth has been well trampled by both sides in this issue. It might have been a bit more plausible had the opposition party not set up a stage complete with expensive sound systems and left it up for over two months. In that case you have to question the financial backing especially when thousands of people remained in the square. I recall the days of the Vietnam protests where protesters had about enough money to stay in D.C. for about three or four days before having to depart.

Here's a bit of back story from the people on the ground. Yes you could actually ask questions of these regular folks if you knew where to go on the web. Contrary to what main stream media would have you believe these people aren't as dumb as they're portrayed. While a small group are extreme right wingers neo-nazis as they're referred to the bulk of the people there realize that they have no taste for either Russia or the EU. They'd like nothing better than to have their own autonomous nation free from the clutches of the east or the west. Sadly that probably won't happen as the country is $70 billion in debt. With an average per capita income of around $200 a month things aren't about to change any time soon. Reports surfaced that the protesters were getting $500 to show up at the square which may or may not be true. It's a safe bet that some monies were paid because who in their right mind would go to a square in the middle of winter to freeze their butts off?

Exactly how this will all end is anyone's guess but one thing is certain, the people aren't going to want to remain in the situation they're in now for very long. And if you step back a bit from the politics you'll note that it's nothing more than two factions of the 1% fighting over the country. Russia is dangling the carrot of cheap oil and gas while the west has its' better life style to envy. And there's the matter of the Russian navy fleet based in the Crimea that needs protecting. One has to wonder if a few older folks long for the days of the old Soviet Union even though it was as corrupt a system as what we see now. 

We are now at the point in the play Mrs Lincoln where the curtain falls but the play isn't over yet. All we can hear now are some muffled whispers behind a heavy curtain and at present there'll be no going back stage to congratulate the actors as they're still busy trying to write the last act. That is if the bankers are still willing to continue financing this. 

And as usual bank fails later... 
No bank fails this week carry on.

Friday Pussy - The Russians are coming the Russians are coming

Okay pussies are late this week, but the Russians weren't. And just how they'll spin their luncheon of lies on this one is anyone's guess, but one thing's for sure the little guy isn't going to make out well no matter what happens.
First off the U.S, has been wanting to get some type of influence in that region for some time now. We did after all finance the Orange revolution when it started to the tune of $5 billion. And the average "protester" this time around got $500 a month for showing his/her displeasure in the main square. That's about double the going rate er income of the average Ukrainian. The bribes and corruption are beyond the pale here. Should we be surprised? No because that figure is buried somewhere in some secret budget that nobody can talk about lest they be called a liar. Makes ya want to have a peek at a CIA budget just to see how our tax dollars are being stolen. National security my arse. Plenty of money for fine leather chairs and wall artwork but screw the veterans who actually paid their dues. What did you do in the grand scheme of things senator other than raise funds for you next election and quash another bill that just might have helped somebody? Thought so.

So what's this all about? It isn't about ideology or some flag waving support of national pride although that's what they'd have you believe. This is about oil gas and who has the power to control it. Putin sure got the free market thing down pat, vulture capitalism at it's best. The bulk of the energy lines goes right through the Ukraine and on to Europe so why not keep control of it? Just don't try and cross Putin or you land up in an unheated cell in a place nobody's ever heard of.

Ah but there's another plot turn to this three penny play that's ever so hush hush. That would be the fact that Exxon Mobile was about to reach a deal with the Ukrainians after a discovery of a large gas and oil find right off their coast in the Black Sea. Exxon wanted to pony up $700 million so you know this was no small potatoes. All of this was about to start shortly until the revolution started or should we say Kanukovich got a better deal from the Russians. Guess he didn't have enough play toys at the palace, but then maybe this wasn't about money because after all he had more than he knew what to do with. There must be at some point where the mass accumulation of wealth is just not enough. At some point the money becomes meaningless and then it's about the power. What a sickness that must be.

The Ukrainians were screwed from the start. The country was $15 billion in debt (a paltry sum by US standards) with little resources. Had they taken the first offer of a "bail out" from the EU they would have been saddled with even more debt compound interest can be a mother if you can't pay it back. The Greeks found that out the hard way. The other option was to go with Putin and his band of thieves. Either way it's not likely conditions would change. One thing is certain the little guys losses. The debt which was magically created (remember it's all done with smoke and mirrors because that money never existed in the first place) will be laid on two nations at a very minimum. Germany France and the other Eu countries don't have that kind of cash laying around in a bank vault. So there you have it.

And speaking of banks let's see how the little fish did this week.
We see two more banks hit the skids in Va and Pa.