Archive

Archive for January 3, 2011

IN THE STOCK MARKET, IT’S 1937 ALL OVER AGAIN

January 3, 2011 Comments off

One of the most worrisome problems in the stock market right now is that we are basically repeating the exact same situation that occurred from 1937 to 1942.

Most Americans think we’ve had this amazing stock market recovery since the financial crisis of 2008… and we have to a certain extent.

But we are by no means out of the woods.

In fact, during America’s last real economic collapse, in the 1930s and 1940s, we saw a similar drop and recovery… before the markets crashed all over again.

In fact, the situation is eerily similar.

Look at this chart… it’s one of the scariest I’ve seen in a long time. It shows an overlay of what happened in the stock market in 1937 compared to 2008. In both situations, we saw big crashes, of about the exact same magnitude… then a big recovery, again of about the same size.

But what will happen next?

Well, if history is any guide, we could well have another big leg down in the stock market. That’s exactly what happened 70 years ago.

And with all of the problems left unresolved in our economy today, it could certainly happen again, especially if the U.S. dollar loses its reserve status.

http://www.stansberryresearch.com/pro/1011PSIENDVD/PPSILC42/PR

Advertisements

Normalcy bias-Term of the week

January 3, 2011 1 comment

The normalcy bias refers to an extreme mental state people enter when facing a disaster. It causes people to underestimate both the possibility of a disaster occurring and its possible effects. This often results in situations where people fail to adequately prepare for a disaster, and on a larger scale, the failure of the government to include the populace in its disaster preparations. The assumption that is made in the case of the normalcy bias is that since a disaster never has occurred that it never will occur. It also results in the inability of people to cope with a disaster once it occurs. People with a normalcy bias have difficulties reacting to something they have not experienced before. People also tend to interpret warnings in the most optimistic way possible, seizing on any ambiguities to infer a less serious situation.

Hurricane Katrina…

Even as it became clear that the levee system was not going to work, tens of thousands of people stayed in their homes, directly in the line of the oncoming waves of water.

People had never seen things get this bad before… so they simply didn’t believe it could happen. As a result, nearly 2,000 residents died.

Again… it’s the “normalcy bias.”

We simply refuse to see the evidence that’s right in front of our face, because it is unlike anything we have experienced before.

The normalcy bias kicks in… and we continue to go about our lives as if nothing is unusual or out of the ordinary.

Well, we’re seeing the same thing happen in the United States right now.

We have been the world’s most powerful country for nearly 100 years. The U.S. dollar has reigned supreme as the world’s reserve currency for more than 50 years.

Most of us in America simply cannot fathom these things changing. But I promise you this: Things are changing… and faster than most people realize.

For a moment, just look at a tiny fraction of the evidence around us….

** 13% OF POPULATION ON FOODSTAMPS

Did you know that there are now nearly 42 million Americans on food stamps? That’s nearly 13% of the entire population. Those numbers are up 17.5% from last year… and the number of Americans on food stamps has gone up every month for 19 months.

Can a country really be in good shape when 13% of the population can’t even afford to buy food?

Or how about this…

** SHANTY TOWNS COMING TO YOUR NEIGHBORHOOD

Although it’s gone almost completely unreported in the mainstream press, in a dozen or so cities across the nation (like Fresno, Sacramento, and Nashville), there are hundreds of people living in modern-day, Depression-era shanty towns.

The Fresno shanty town has received the most publicity, after a visit by Oprah Winfrey. There, about 2,000 residents are homeless. They even have a security desk at the shelter, because the encampment has gotten so large. City officials say they have three major encampments near downtown, and smaller settlements along two local highways.

Also…

** 43% OF AMERICAN FAMILIES ARE ESSENTIALLY BROKE

According to a recent article on MSN Money, about 43% of the American families spend more than they earn each year.

http://www.stansberryresearch.com/pro/1011PSIENDVD/PPSILC42/PR

Ten Riskiest Places to live In America

January 3, 2011 Comments off

Ten Riskiest Places to live In America

NOTE: THESE PAGES HAVE BEEN DRAMATICALLY UPDATED

IN Prudent Places USA — 3rd EDITION

The University of Chicago Press will soon release Mark Monmonier’s new
book, Cartographies of Danger, which looks at how well America maps its natural
and technological hazards as well as social hazards like crime and disease. We
asked Mark to give us a list of the country’s ten most hazardous places. Here is
his top ten (or is that bottom ten?) list:

Hazards of different types affecting areas of varying size are not easily
compared. Even so, the research experience makes it easy to identify ten typical
risky places–areas to which I would be reluctant to move.

1.Almost any place in California, for various reasons: In addition to earthquakes, wildfire, landslides, the state has volcanically active areas in the north, around Mt. Shasta and other major volcanoes, as well as in the east, where the Long Valley Caldera shows signs of renewed activity. Even beyond its infamous seismic zones, California’s shoreline is vulnerable to tsunamis (seismic sea waves) from submarine earthquakes throughout the Pacific. More recent additions to this smorgasbord of hazards are smog, freeway snipers, urban riots, oil spills, and (looking ahead a few decades) severe water shortages.
2.Located only 70 miles from Mt. Rainier and Glacier Peak, which the U.S. Geological Survey considers active volcanoes,Seattle, Washington is also vulnerable to severe earthquakes. Unlike Californians, long aware of the risk, Washingtonians have only recently begun to plan for a seismic disaster.
3.Coastal Alaska and Hawaii are especially susceptible to tsunamis, huge waves whipped up by submarine earthquakes in the Ring of Fire encircling the Pacific Ocean. Alaska’s Pacific coast is seismically active, and the Hawaiian Islands can generate their own tsunamis: deposits on Lanai suggest past run-ups as high as three thousand feet, and geophysicists fear a similar disaster were the southeast side of the Big Island (the island named Hawaii) to slide suddenly into the sea.
4.Tropical hurricanes pose a less catastrophic but more frequent danger to the Atlantic Coast, particularly to North Carlina’s Outer Banks, a long, thin barrier island, from which evacuation is difficult. Since the seventeenth century, infrequent but fierce storms have carved new inlets, filled old channels, and move the shoreline westward at a rate of 3 to 5 feet per year. Moreover, if forecasts of a 250-foot rise in sea level because of global warming prove correct, current settlements on the Outer Banks could be wiped out in the next century or so.
5.Inadequate building codes, shoddy construction, low elevation, and level terrain make areas south of Miami especially vulnerable to high winds and flooding from storms like Hurricane Andrew, which caused over 20 billion dollars damage there in August 1992. Adding to the region’s misery is metropolitan Miami’s crime rate, one of the highest in the nation.
6.The Louisiana coast is also vulnerable to multiple hazards: winds and storm surge from tropical hurricanes, unnaturally high levees along the lower Mississippi River, and air and groundwater pollution from poorly regulated chemical industries concentrated along the state’s Gulf Coast. Cancer mortality is extraordinarily high here as well.
7. The floodplains of the Mississippi and other main-stem rivers, which drain vast areas, are vulnerable to prolonged high water caused by persistent weather systems. The costly floods of summer 1993 demonstrated the shortsightedness of flood forecast models based on limited hydrologic data. Humans play a dangerous game of hydrologic roulette by building homes, factories, and sewage-treatment plants in low-lying areas along rivers.
8. Any floodplain, large or small, anywhere in the country.Think about it: What does the word mean, and how did the floodplain get there? Although most victims evacuate in time, a picturesque parcel where “a river runs through it” carries the threat of sodden heirlooms and undermined foundations. In arid areas, where thunderstorms are infrequent, flash floods kill around two hundred unsuspecting campers and hikers in a typical year. Along rivers large and small, the Federal Flood Insurance program uses maps to set rates, spread the risk, and encourage local governments to plan evacuations and control land use.
9.Because warm weather is attractive to affluent retirees and house-breakers, property crime is especially high in the south, where a warm climate favors year-round burglary. And urban areas with many young males, newly arrived or unemployed, are notorious for violent crime.Growing southern cities such as San Diego, Los Angeles,  Phoenix, El Paso, and Miami, are thus especially hazardous, although risk varies greatly with neighborhood and time of day.
10.The neighborhoods of nuclear plants are risky areas of a different sort. Although catastrophic radiological accidents are rare and highly unlikely, the 1986 Chernobyl event had frightening consequences. More worrisome than the poor design and mismanagement underlying the 1979 Three Mile Island incident, near Harrisburg, Pennsylvania, is the specter of terrorism: a nuclear facility is an enormously attractive target for organized terrorists able to breach security with a vehicle bomb.  Over four million people live within the ten-mile emergency planning zones (EPZs) around America’s atomic power plants, and Chernobyl indicated clearly that radiological accidents can have a lethal reach much longer than ten miles.  Equally daunting is the variation in emergency preparedness among EPZs.

Our country has many more hazardous environments: some mapped well,
others poorly or not at all. As “Cartographies of Danger” demonstrates, hazard-
zone maps are a relatively new cartographic product as well as a good indication
of how well we understand hazards and manage risk. In the book I also point out
why a comprehensive atlas of hazards is not yet possible and why place-rating
guides that focus largely on crime present a distorted picture of danger.

Mark Monmonier is a professor of geography at Syracuse University’s
Maxwel School of Citizenship and Public Affairs. He is author of numerous books
on cartography, including How to Lie with Maps (1991, 2nd ed. 1996) and
Drawing the Line: Tales of Maps and Cartocontroversy (1995).

by Mark Monmonier

Birds Fish Dead in Arkansas

January 3, 2011 Comments off

On New Years Eve 2010 in Beebe, Arkansas 5,000 blackbirds mysteriously plummeted to their death while in mid-flight.  The birds were found in an area that is 1 mile long and 1/2 of a mile wide beginning around 11:30 p.m . No dead birds were found outside of this area. Arkansas’ top veterinarian, Dr. George Stevens, said preliminary autopsies on 17 of the blackbirds, which ruled out poison, indicate they died of blunt trauma and midair.  The dead birds were collected from rooftops and streets, but initial tests found no toxins.

100,000 drum fish were found dead near the town where the 5,000 blackbirds died.   It was reported that the fish died Dec. 29, covered about 17 river miles from Ozark Lock and Dam down to river mile 240, directly south of Hartman, Chris Racey, the Game and Fish Commission’s assistant chief of fisheries, said today in a release. The two events happened  apparently within a 24 hour time period

Arkansas Game and Fish Commission spokesman Keith Stephens said mass “kills” of fish occur every year but he revealed that the magnitude of the latest one was unusual.  “This kill only affected one species,” he said. “If it had been caused by a pollutant it would have affected all kinds, not just drum fish.”

In a seemingly separate incident, some 500 red-winged blackbirds, starlings and grackles were found dead in southern Louisiana in Labarre.Another situation near Little Rock that hasn’t gotten much media attention is the numerous earthquakes that have happened in Guy. According to CNN, there have been 487 “measurable earthquakes” since September 20 of 2010, and the depth of the quakes has been between one-and-a-quarter and five miles below the surface.  What’s especially interesting is that Guy is near a major earthquake fault known as the New Madrid.

Things that make you go hmmmm…