America Just Can’t Make It Anymore.

“Fight Against Stupidity And Bureaucracy”

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USA industrial economy

The statement in the title is not true, except that it is.

If you are a little confused stay with me and let me clarify.

The United States used to be the industrial power house of the world. Its industries generated unprecedented wealth for the country, creating the world’s first self-made billionaires and productive wealth creating jobs galore for everyone. The whole country prospered.

Today, however, the United States has become the world’s second biggest importer of goods. Worse than that, even though America still exports billions of dollars’ worth in oil, consumer goods and automotive products, it imports even more. This creates a trade deficit ($471 billion according to recent figures).

US Trade Deficit

So what are all these imports into the US?

Well, they include industrial machinery and equipment ($681 billion), automotive vehicles, parts, and engines ($309 billion), miscellaneous private services, primarily financial services ($201 billion), cell phones ($90 billion), travel passenger services ($86 billion), pharmaceuticals ($84 billion), computers ($65 billion), chemicals ($61 billion), other transportation services ($59 billion), computer accessories ($57 billion), telecommunications equipment ($54 billion), royalties and license fees services ($42 billion), apparel ($49 billion), petroleum products ($48 billion), fuel oil ($44 billion), industrial supplies ($29 billion), U.S. Government service imports primarily defense ($25 billion), fish ($18 billion), fruit ($13 billion), and vegetables ($11 billion).

Cartoon imports

If you are a bit shell-shocked by all those figures let me phrase it a bit differently using as examples the types of goods you would tend to buy.

  • 100% (almost) of the shoes bought in the U.S. come from China, Vietnam, Indonesia and Mexico;
  • 90% of white goods (washers, fridges, etc.) and consumer electronics are imported;
  • 85% of household furniture is imported;
  • 80% of cars on U.S. roads come from Canada (31%), Japan (24%), Germany (16%) and Mexico (12%); and,
  • 65% of U.S. clothing is imported from China (37%), Vietnam (9.4%), Indonesia (7.2%) and Bangladesh (6.7%).

Probably the saddest part is that even things you thought were “American” are now actually made overseas and imported.

I remember while on a business trip to the US many, many years ago I bought a gift for the young son of a friend of mine. He was a big sports enthusiast so I reckoned that one of the most iconic symbols of sport from America would be a baseball. I bought one in Wal-Mart. It was marked with all the different holding positions for the various ways to throw a baseball (fast ball, curve ball and all that). The perfect gift.

I gave it to him on my return feeling ever so pleased with myself. The kid opened it, showed momentary delight, then looked up at me accusingly. “It says ‘Made in China'” he told me.

Baseball made in China

But it’s not only baseballs. Similar types of product that you would think are all-American, like Converse All Stars, Levi’s, Huffy bicycles, televisions, Monopoly, Etch-a-Sketch, Radio Flyer wagons, Barbie dolls, and last but by no means least, most of those American flags just ain’t American no more.

modern monopoly board

It really doesn’t have to be this way. Apple, for example, doesn’t have to become the richest company in the world by manufacturing its products in China and storing its vast hoards of cash overseas.

Or does it?

Everything on the lists above could still be made in the US and surpluses exported to other countries. But the US government and its moronic bureaucrats are spending their time and our money thinking up new ways, not to help American businesses, but to add ever-increasing amounts of rules, regulations and bureaucracy on to American companies.

American businesses can no longer compete, because their own government has ensured that the deck is stacked against them.

In the mind of a bureaucrat losing a million productive wealth creating jobs, for example, in the automotive industry, and replacing them with a million more administrative jobs that cost the country money evens things out.

It doesn’t. Simple math will tell you that. Every time it happens things get worse and America gets poorer.

So America just can’t make it anymore, but not because China has stolen the jobs. It’s because the US government bureaucrats gave them away.

Put the blame where it should be.

StimulusBureaucrats

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Time For Some Crude Talk.

“Fight Against Stupidity And Bureaucracy”

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$200 per barrel oil

It’s not so long ago that I was getting bombarded with emails about how great an investment oil would be.

At that time the predictions by those in the ‘know’, who really know nothing, was that oil would hit $200 per barrel – maybe much, much more!

Well, they almost got the number correct, except that oil actually hit $20 per barrel, not $200. As these things go it was a pretty good guess!!!

declining oil price

So why has the oil price declined and, although it has recovered a bit, why are the predictions for today’s low prices to hold long term?

The simple layman’s answer of course is that the oil price has declined because supply is greater than demand. When there is a surplus of a commodity the price falls and when it is scarce the price rises.

The supply of oil has increased relative to demand for a number of reasons.

The most obvious one is the vast reserves of oil found and now being recovered in the massive shale-oil fields in the United States of America and the tar-sands in Canada that have added more than 5 million barrels per day to domestic oil production since 2008. Able to produce more at home, North America has been able to reduce its demand for imported oil.

OPEC

The effect of this, of course, is that the OPEC countries have seen their annual revenues fall sharply during the same period. To try to rectify this fall in income, which they need to provide for their own citizens, they have been trying to replace lost revenue from North America by increasing production of their own oil supplies.

In other words, they have created even more over supply in the market, which helps to keep the oil price down.

Then there was the ISIS or ISIL terrorists in Iraq who had taken control of most of the oil fields and were dumping oil on the black market as fast as they could to help finance their war. Recently they’ve lost control of a lot of those oil fields so that part of the equation may no longer be in play to the same extent.

However, if there is a deal ever done with the Iranians and they are able to trade without restriction again, no doubt they will be adding their oil to the market glut which will also help to keep the market over-supplied and the price suppressed.

burning off gas at oil well

Then there is the increasing use of compressed natural gas or CNG. This is the natural gas that used to be burned off at the oil wells, but that is now collected, compressed into tanks and used to power vehicles and in drilling equipment, meaning less diesel is purchased.

Despite all these over-supply pressures, the thing that is keeping the oil price from collapsing completely is the continued demand from China. This is a good thing because a long-term collapse in the oil price, whilst it may make life a bit easier financially for many with decreased heating and fuel bills, also has detrimental secondary effects on some parts of the country where the oil industry provides a living for a great many people.

I haven’t had an email about investing in oil for a long time and I don’t expect them to start again soon. Now you know why.

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They’ve Got It Wrong AGAIN!

“Fight Against Stupidity And Bureaucracy”

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The Sunday Sermon

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russia-sanctions

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I wrote a short post the other day on the subject of failure. I think it was a success 🙂

What hasn’t been a success, however, is America’s foreign policy. I’ve also written about this many times in the past. I find it very annoying that a country as great as America and with so many brilliant people within it can neither elect a smart politician, or even a not so smart politician but one who has enough brains to hire smart advisers.

The current President, Barack Obama, has continued the trend of failure. Particularly with regard to foreign policy, at which he has not only failed but added indecision and procrastination to the mix.

The examples are many, but the latest foreign policy debacle is the leading role America has taken in the imposition of sanctions against Russia. Sanctions that may have been aimed against Russia but which are already starting to backfire against the US.

I noted in another post that sanctions have been imposed in regard to Russian oil and natural gas, which Europe (particularly Germany and France) needs, but America doesn’t; but that the sanctions were not imposed on nuclear fuels, which America does need.

Believe me, the hypocrisy of that has not been lost on the European governments or its public.

And the hypocrisy does not end there.

rosneft getty

On the one hand there have been hyped up media statements telling everyone that Rosneft, Russia’s largest oil company, and its head Igor Sechin, have been targeted in the sanctions.

But what hasn’t been trumpeted so loudly is the fact that British oil company BP, owns almost 20% of Rosneft, and has confirmed that it would not be severing ties with the Russian firm.

Similarly, Norway’s Statoil is continuing its partnership with Rosneft to search for oil in the Norwegian section of the Barents Sea.

And France’s major oil and gas company, Total, has announced that it is seeking financing for its next gas project in –  where else? –  Russia. When they get that financing, amounting to something in the region of $27 billion, it will be in Roubles or maybe even Yuan, but certainly not in US dollars – again thanks to the ill thought out sanctions.

This will set a trend for similar deals that will also exclude the US dollar, inevitably lowering its standing as the world’s reserve currency. I expect more such deals to be done with the Russians by German companies in particular as the sanctions fail to bring the promised results and as a consequence start to fall apart.

But it gets worse.

Before any of the US Senators or Congressmen stand up and start to call names at the Brits or the Norwegians or the French for backtracking on sanctions, they would be better to take a look nearer home.

It now seems that American Companies are not paying attention to the sanctions either.

ExxonMobil_Challenges

For example, ExxonMobil, America’s largest oil company, has continued drilling offshore in the Russian Arctic, also with Rozneft.

If the sanctions were anything more than a bit of public posturing by Obama, ExxonMobil shouldn’t (and wouldn’t) be doing any more work with the Russians in Russia. But using the excuse that it is environmentally safer to complete the well than to allow the Russians to do it alone, ExxonMobil got permission to continue.

No doubt the company will express its gratitude when the next round of electioneering fund raising comes along! (Gosh, I’m such a cynic!)

Now, if Obama and his advisers had thought for a moment about the consequences of sanctions, they would have realized that, in cases like this, companies such as ExxonMobile had not really got a choice. If they hadn’t continued to work with Rozneft, the Russian company would simply have gone ahead without them with a consequent dilution of ExxonMobile’s return if/when the well is a success.

In addition to that, if the Russian company did need other help you can be sure there would have been a Chinese energy company there ready and willing and eager to take up the slack.

Whilst Obama and his predecessors have been blundering around the world pissing off friend and foe alike, the strategy of the Russian President has been to cultivate new friends and thereby new markets and customers for his country’s vast energy reserves.

It has been a clever move.

Sanctions or not, game to Putin this time I think.

sanctions against Russia

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Coffee Anyone?

“Fight Against Stupidity And Bureaucracy”

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If you are a regular reader of this blog you will have realised that I like facts about various subjects.

One of them is food.

I have already done a post about peanut butter (click here) and one about chocolate (click here) , both everyday items that almost all of use and enjoy. ‘

Today’s post is about probably THE most loved and enjoyed drink that we use everyday.

So here we have lots and lots of things you probably never knew about you coffee.

Enjoy (with a nice cup of coffee or three perhaps).

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Coffee Bean Man

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According to legend during the 9th century Ethopian shepherds first noticed the effects of caffeine when they saw their goats appearing to become frisky and ‘dance’ after eating coffee berries.

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Originally coffee was eaten.

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African tribes mixed coffee berries with fat to make energy balls

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Coffee has been used as a beverage for over 700 years.

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The rise of Islam contributed greatly to the popularilty of coffee. The religion prohibited drinking alcohol, but coffee was considered an acceptable drink

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In Turkey, the bridegroom as once required to make a vow during the wedding to always make sure to provide their wives with coffee. If they did not do so it was considered grounds for divorce.

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Also in Turkey, the intended bride is required to serve coffee to her parents and future husband when he comes to ask for her hand in marriage; however, she has no say so in the outcome of the request. Tradition has it that her response is in the sweetness or lack thereof of the coffee. Sweet coffee supposedly means she is okay with the arrangement while salty means she is not.

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All the coffee grown in the world grows in the bean belt which is the area between the Tropics of Cancer and Capricorn

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Hawaii is the only state in the US that grows coffee

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The heavy tea tax imposed on the American colonies in 1773, which caused the ‘Boston Tea Party’, resulted in America switching from tea to coffee. Drinking coffee became an expression of freedom.

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Black coffee with no sugar contains no calories.

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Drinking a single cup of coffee that has been brewing for 20 minutes provides the body with 300 phytochemicals which act as antioxidants and stay in the body for up to a month.

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New Yorkers drink almost seven times more coffee than other cities in the US.

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Coffee is a psychoactive. And at high doses it can make you see things… It can also kill you…The lethal dose of caffeine is roughly 100 cups of coffee.

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The French philosopher Voltaire is said to have drank 50 cups of coffee a day.

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In 1675 Charles II, King of England issued a proclamation banning Coffee Houses. He said that they were places where people met to plot against him.

 coffee house.

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Coffee is the second most traded commodity on earth, after oil.

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70% of the world consumes Arabica coffee, which is mild and aromatic. The remaining 30% drink Robusta, which is more bitter tasting but has 50% more caffeine than Arabica

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Coffee grows on trees, which can grow up to 30 feet tall but commercially are cultivated to around 10 feet in height for easier picking

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A coffee tree has a lifespan of about 50 to 70 years.

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When it is in bloom, the coffee tree is covered with 30,000 white flowers which begin to develop into fruit after 24 – 36 hours.

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A coffee tree can flower eight times in any one year – depending on rainfall.

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The coffee cherries turn from yellow to orange and then bright red, 6 – 8 months after flowering.

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One coffee tree yields less than half a kilo of coffee per year.

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A French doctor in the 1600s suggested Cafe Au Laits for patients, inspiring people to begin adding milk to coffee.

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The coffee bean is actually a seed inside a bright red berry

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Coffee berries are picked, dried and stripped down until all that is left is the green bean

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Once shipped the beans are roasted at around 500F, after a few minutes the bean will pop and double in size, a few minutes after that the bean will pop again which means the bean is ready

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The aromas in coffee develop at the 10th minute of roasting.

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Coffee increases in volume during roasting by 18.60%.

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Caffeine is not the main bitter compound in coffee. Rather, the pungent perpetrators are antioxidants.

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George Washington invented instant coffee. No, not him, the George Washington from Belgiun, living in Guatemala in 1906, although the invention has also been claimed by a Japanese American chemist known as Satori Kato in 1901.

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Espresso is regulated by the Italian government because it is considered an essential part of their daily life

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Espresso is not a particular roast, bean or blend, just the way the coffee is prepared by shooting pressurized hot water through finely ground coffee

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Brewed espresso has 2.5% fat, while filtered coffee contains 0.6% fat.

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It takes 40 coffee beans to make an espresso.

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In 1822 the French were the first to innovate a crude espresso machine. The Italians then perfected this machine and became the first to manufacture it.

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Contrary to popular belief, espresso has one-third the caffeine of a cup of coffee, simply due to serving size differences.

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In 1785, the coffee revolt broke out in Prussia because coffee consumption was restricted to the nobility, the clergy and high officials.

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James Mason invented the coffee percolator on December 26, 1865.

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30% of coffee drinkers in US added a sweetener of some kind to their coffee, compared with 57% in UK.

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Coffee sacks are usually made of hemp and weigh approximately 132 pounds when they are full of green coffee beans. It takes over 600,000 beans to fill a coffee sack.

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October 1st is official “Coffee Day” in Japan.

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Scientists have discovered more than 800 different aromatic compounds in coffee.

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Italy now has over 200,000 coffee bars, and still growing.

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The term Americano comes from American GIs during WWII who would order espresso with water to dilute the strong flavor

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The term cup of Joe also comes from American servicemen in WWII who were known as big coffee drinkers

cuppa joe .

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The custom of tipping waiters originated in early European Coffee Houses, in order to receive good service in that loud, dirty, hectic place you needed to Tip Big.

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In the ancient Arab culture there was only one way a woman could legally divorce: If her husband didn’t provide enough coffee.

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Melitta Bentz a housewife from Dresden, Germany, invented the first coffee filter in 1908.

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Johan Sebastian Bach wrote an opera about a woman who was addicted to coffee.

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There is a way to brew coffee with marijuana in it and it is described as producing a “dreamy” kind of coffee buzz.

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In Greece and Turkey, the oldest person is always served their coffee first.

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Some of the worlds most powerful businesses, including Lloyds of London and the New York Stock Exchange, started life as a coffee houses.

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In the 1600s there was a controversy over whether or not Catholics could drink coffee, luckily for them Pope Clement VIII loved coffee and authorized its use.

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Caffeine, which is found in coffee, increases the effect of some painkillers, especially aspirin and paracetamol.

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Dorothy Jones of Boston was the first American coffee trader, In 1670 she was granted a license to sell coffee.

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In Africa coffee beans are soaked in water mixed with spices and served as candy to chew.

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A regular 6oz cup of coffee contains about 150 milligrams of caffeine, most physicians call this a “therapeutic dose”.

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There are over 50 species of coffee world wide. Though only 2, arabica and robusta, are commonly used in commercial coffee production.

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Robusta coffee beans have twice as much caffeine than Arabica beans, but our of less quality.

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If you drink five to 10 cups of decaffeinated coffee, you could get as much caffeine as from one or two cups of caffeinated coffee, a study found.

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To produce decaffeinated coffee the beans are steamed, so that dissolved caffeine rises to the surface, where it is washed off using an organic solvent called methylene chloride.

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Coffee can actually be used to fuel a car.

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At one point, Brazil had such a coffee surplus that they tried to find other uses for it, including using it to make plastic.

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The world record for most coffee consumption is 82 cups of coffee in 7 hours.

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Contrary to popular belief light roast coffee actually has more caffeine than dark roast coffee. The reason for this is that the longer coffee is roasted the more caffeine cooked out of the bean.

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An expert in preparing Turkish coffee is known as a “kahveci”.

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The Nicaraguan Margogpipe is the largest of all coffee beans.

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King Frederick of Germany created a special task force to search out illicit coffee smugglers. The task force was known as the Kaffee Schnuffler. The king believed that soldiers who drank coffee were not dependable.

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Both the French and American Revolutions were planned in coffee houses.

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‘Excelso’ or ‘supremo’ do not mean a better quality of coffee when used to describe coffee beans, it refers to the size of the coffee bean.

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Jim Henson, the creator of the Muppets got his start doing coffee ads.

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One the largest misconception in the U.S. today about coffee is that Mocha Java coffee is a chocolaty beverage. In fact there is no chocolate in the Mocha or Java bean at all. Mocha is the name of the largest port in Yemen, here is where all of the African coffee beans are traded and transported. Java is the name of an island in Indonesia where the Java Bean comes from. Both coffees are a dark bean and provide a very rich and bold coffee, when you mix the two together you get Mocha Java coffee.

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Coffee at one stage in its life or another provides a living to more than 100 million people.

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During World War II there was a coffee drinking competition between the branches of the military. The Marines claimed to drink the most – twenty cups a day.

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Coffee was so scarce in Germany that during WWII “coffee bombs” or bags of coffee were dropped from planes to turn the people against their government.

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In Staten Island, there’s a restaurant owner that drinks fifty cups of coffee a day.

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The actress who played the Wicked Witch Of The West in the Wizard Of Oz, Margaret Hamilton, was promoting Maxwell House in the 1970’s.

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In December 2001 Brazil produced a scented postage stamp to promote its coffee – the smell should last between 3 and 5 years.

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No matter what people tell you, caffeine cannot help you sober up.

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The first webcam was invented at The University of Cambridge to let people know if the coffee pot was full or not.

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The Japanese believe that bathing in coffee grounds fermented with pineapple pulp will reduce wrinkles and beautify the skin and there is a spa in Japan that lets you bathe in coffee, tea, or wine. I wouldn’t drink it though…

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Before coffee caught on in the US in the 1700s, beer was breakfast drink of choice. Difficult choice!

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Irish coffee was actually invented to warm up cold American plane passengers leaving from Ireland.

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On May 11, 1926, the slogan “Maxwell House Good to the last drop” was trademark registered.

 Coffee-Posters.

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There is a tourist agency for people wanting to take coffee vacations called Cafe Away.

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Norway drinks the most coffee per person. The United States is ranked number 12.

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Teddy Roosevelt is and was the greatest American coffee drinker, consuming a gallon a day. But you probably shouldn’t attempt to do that.

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The name cappuccino comes from: the resemblance of the drink to the clothing of the Capuchin monks.

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A study conducted at the University of Sao Paulo found that sperm motility was markedly higher in coffee drinkers versus non coffee-drinkers. And it turns out that it doesn’t matter whether you drink one or ten cups a day: The only detectable difference was found between coffee drinkers and non-coffee drinkers.

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Beethoven counted the number of coffee beans he used to make his coffee and insisted on 60 beans per cup.

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During the American Civil War soldiers who were craving coffee and couldn’t get it tried roasting sweet potatoes and corn to make a beverage similar to coffee. It obviously didn’t become a popular choice.

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In 1674 a group of London women formed a group called WPAC (Women’s Petition Against Coffee). They didn’t like the amount of time their husbands spent in coffee houses rather than being home where they belonged.

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According to David Levitsky, PhD, professor of nutritional science at Cornell University, “Caffeine decreases the rate at which the stomach dumps its contents into the duodenum – a part of the small intestine where digestion takes place – and also increases metabolic rate.” so sipping a cup post-meal could, in small part, help promote a healthy weight.

coffee maker .

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Water is the only beverage more popular than coffee.

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Coffee contains over 1200 chemicals and over half of those are responsible for creating its flavor.

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The average coffee drinker consumes 3 cups of coffee per day.

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Three countries consume 65% of the world’s coffee: America, France, and Germany.

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Coffee grounds sprinkled on the ground around plants and the garden will stop snails and slugs from eating the plants.

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Kenyan coffees are graded as ‘A’, ‘B’ and ‘C’. ‘AA’ is the best coffee. In Costa Rica, coffees are graded as ‘Strictly Hard Bean’, ‘Good Hard Bean’, ‘Hard Bean’, ‘Medium Hard Bean’, ‘High Grown Atlantic’, ‘Medium Grown Atlantic’, and ‘Low Grown Atlantic’. Those coffee beans from Colombia are labelled as ‘Supremo’, ‘Excelso’, ‘Extra’ and the lowest grade, ‘Pasilla’.

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In 1763, there were over 200 coffee shops in Venice.

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Caffeine is on the International Olympic Committee list of prohibited substances. Athletes who test positive for more than 12 micrograms of caffeine per millilitre of urine may be banned from the Olympic Games. This level may be reached after drinking about 5 cups of coffee.

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Coffee was first known in  Europe as Arabian Wine.

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It was said that cowboys made their coffee by putting ground coffee into a sock (hopefully a clean one) and immersed it in water heated over a camp fire. When ready, they would pour the coffee into tin cups and drink it.

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A study from the Harvard School of Public Health, published in the Archives of Internal Medicine, found that women who regularly drink fully caffeinated coffee have a 20% lower risk of depression than non-coffee drinkers. The study, which followed a group of women for 10 years, found that as more coffee was consumed (up to six cups per day), the likelihood of depression decreased.

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There are two major coffee markets in the world. One is in London, which deals with the buying of Robusta coffee. The other is the ‘C’ contract market, known as Coffee, Sugar and Cocoa Exchange (CSCE), which is in New York. It handles the trade of Arabica coffee. The ‘C’ market is also a futures market.

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Finally, can you see the man?

coffee test

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Gosh, It’s A Two Post Sunday!

“Fight Against Stupidity And Bureaucracy”

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I haven’t had a rant for a while, so one is long overdue. Here it is.

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I’m sure hardly anybody noticed, but last week the bureaucrats in Washington effectively shut down the web site Intrade for US citizens. Intrade was the popular web site that any adult, including Americans, could use to wager on the future price of certain commodities, like gold or oil.

Effectively the bureaucrats have now made it illegal to solicit Americans to buy and sell commodity options contracts unless they are listed on an exchange registered with them or on one designated as legally exempt by them, and they have taken upon themselves the power to regulate nearly any commodity-related activity unless Congress provides a specific exemption.

Of course the politically well connected investment banks and hedge funds into which the great and the wealthy put their money can carry on as before speculating on the price of everything from pork bellies to platinum and manipulating gold, currency, oil and other markets. The recent MF Global scandal really puts that beyond reasonable doubt.

Intrade is just the latest move by the bureaucrats and the thought police to restrict the freedom of American citizens. Not so long ago it was the online gambling websites, then New Zealand based Megaupload was targeted, then banking in any offshore jurisdiction, now the Ireland based Intrade, and tomorrow, well, who knows.

Maybe the ever sensitive morons in the thought police will try to stop you reading blogs critical of their asinine bureaucracy? Oh, oh, gulp!

The way they are acting is nothing short of a complete perversion of the concept of a government with limited powers. But are the liberals, who should be in the forefront of upholding such principles, falling over themselves to defend the ordinary people?

Not likely.

If and when this type of interference happens in China or North Korea or somewhere similar, they are rushing to get on to their high horses to condemn and ridicule.

But back in Washington they are busy trying to create an inefficient and bureaucracy-ridden nanny state that they know will necessitate clamping down on individual choice and freedom, if it is to even stand a chance of making it look as if it is working.

To add insult to injury the bureaucrats make their usual claim that they are taking these steps for “your own protection”.

Why is it that the steps the bureaucrats take in the ”public interest” never seem to turn out to be in my interest or in the interest of anyone I know?

By the way, in case you are wondering, I have never used Intrade, it’s not my kind of thing and I don’t know enough about that field to speculate with any consistent degree of success.

But I would appreciate the freedom to make up my own mind on the subject, instead of having the faceless and less intelligent bureaucratic thought police dictate the decision for me.

We all know how successful the Volstead Act was at the beginning of the last century, but the bureaucrats learn nothing from their mistakes. And they never will, because their desire is not to do what is right or just or even sensible, their desire is to create an ever growing bureaucracy which they control.

Home of the brave? No doubt about that when you see the young people who are willingly putting themselves in harm’s way to help to defend the nation.

But land of the free? No siree, not no mo!

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