escape from the cube

It’s not pretty. I lost $11,000 in my retirement this month, and have lost in total $18,786 since *September*. I know I’m not alone.

I don’t really have much encouraging to say about the current climate, so I just won’t say anything at all.

One of my good friends came into a windfall of several thousand dollars a few days ago. I pleaded with this person to please save the money for a little while (they had wanted to spend it immediately, and I know for a fact that this individual has a lot of debt and not much in savings). I fear that this mentality is widespread in America, and until this changes I only foresee more hard times ahead for those who either can not or will not learn to adapt to our new financial reality.

I was scared to look but it’s really not that bad. It could have been a lot worse. I lost just over $7,000 in my retirement account. Needless to say, I think it’s prudent not to quit my full time job right now, which I was planning to do this month. I think now is the time to hunker down and save hard, not strike out on my own and run through my savings if my business doesn’t do well.

My business profits have held up surprisingly well. We’re still making  a nice profit, believe it or not. We have no loans and no need of credit so the credit crunch isn’t taking a toll on us. We certainly don’t rely on loans to meet payroll or buy things that the business requires.

I’ve read that the Fed has done away with 23A of the Federal Reserve Act.

This means that your deposits at Bank of America can now be used to shore up losses that Merrill Lynch has on its books.

Why is no one jumping up and down about this? What happens if the FDIC is already tapped out (which I have read is amost a sure bet) and Bank of America has already spent your money covering these shady investments? They borrow money from the Treasury? What are the implicaitons there?

The headlines today are downright scary. A couple of things stood out to me beyond the usual talk about Lehman and Merril Lynch. This from the NY Times article here:

For example, if Bank of America completes its acquisition of Merrill Lynch, its capital reserves would immediately fall below the minimum requirements for bank holding companies.

Followed by this:

Administration officials acknowledged last week that more bank failures were inevitable, and the main protection for depositors — the Federal Deposit Insurance Corporation — is likely to exhaust its reserves.

Does this mean that BoA could potentially not have enough money on hand to cover depositors at the same time the FDIC could be tapped out? Am I misunderstanding this?

An independent (read about it here) study has stated:

“… investors poured $60 billion into oil futures markets during the first six months of the year as oil prices soared from $95 to $145 a barrel. Since then, investors have withdrawn $39 billion from those same markets as prices have retreated.

Michael Masters of Masters Capital Management, which did the study, said the flow of money - not major changes in supply and demand - caused the volatile movement of oil prices. The report was released Wednesday by Senate and House sponsors of bills to put additional curbs on oil market speculation.”

So, if you want lower gas prices this speculation must be curbed.  You need to get behind these bills that are going to curb it. That same money is still out there looking for a high return on investment and it has to land somewhere.

I noticed that the last time the House of Representatives voted on a bill to curb this speculation, it failed. Want to see how your representative voted? Look here.

So, high gas prices are front page news for months, but the root cause isn’t?

Here it is. Even though I’ve managed to save up a whopping 5k this month (I surprised even myself with that!) my net worth is only slightly higher because of the decline in value of our home. I don’t really care, since I actually intend to live in our house for a long time.

This takes the prize for the most retarded study citation of the day. Surprise: organically grown food has the same nutrients as non- organically grown food. Really?! Who knew?

Organic food is better for you because you are not ingesting a bunch of carcinogenic pesticides when you eat it, not because the nutrients contained in the food itself are different. Did you know that Monsanto has patented genetically engineered corn that doesn’t die when it is bombarded with its patented insecticide called “Roundup”? The weeds around it die, but the “Roundup Ready” corn doesn’t. Do you really want to ingest Roundup?

This article completely misses the point, but I’m sure those assholes at Monsanto will be touting this worthless study.

I don’t think it takes a genius to figure out that this is what was going on. Surprise- speculators were a huge cause of the run up in oil prices! There was no other logical explanation for the sudden sharp rise in prices. The bottom line is that if we want prices in everything to go down, there needs to be some sort of regulation on commodities that are essential to our people- specifically food and oil.

From an article on the Washington Post. Read it for yourself here:

The CFTC, which learned about the nature of Vitol’s activities only after making an unusual request for data from the firm, now reports that financial firms speculating for their clients or for themselves account for about 81 percent of the oil contracts on NYMEX, a far bigger share than had previously been stated by the agency. That figure may rise in coming weeks as the CFTC checks the status of other big traders.

“It is now evident that speculators in the energy futures markets play a much larger role than previously thought, and it is now even harder to accept the agency’s laughable assertion that excessive speculation has not contributed to rising energy prices,” said Rep. John D. Dingell (D-Mich.). He added that it was “difficult to comprehend how the CFTC would allow a trader” to acquire such a large oil inventory “and not scrutinize this position any sooner.”

Here it is. I was actually able to save quite a bit this month (finally!)

I’ve been rethinking my plan to quit my job in October (I know, I know). With the economy doing so crappily it seems insane to walk away from this place. Of course, the nice thing to know is I CAN walk away at any time if I want.

I wasn’t able to save much this month because we spent a lot on vacation- oh well. It wasn’t as much as we spent in Europe last year!

Here’s the update. Really I’m surprised it wasn’t much worse considering the fact that the stock market just took a huge crap.