This will be not-market-related. Just few thoughts about the republican presidential debate aired tonight.
Just as I started to notice some some folks returning to sanity, I got again surprised how pervasive stupidity is in the media and our political leadership.
The first idiocy I am referring to is the belief that the US budget deficit is the biggest problem that we have and I commented on that in my prior blog everybody-knows-consensus
For a shrewd market observer, it should be clear that with the interest rates near zero, the problem is the opposite- not enough borrowing by our government. With the private sector and the public on the spree of deleveraging and with "debt aversion", the US government became the "borrower of last resort". It is actually an interesting spin on the theory nicely explained by Charles Kindleberger in his book "Manias, Panics, and Crashes" that I had pleasure to read in the runup to the 2000 market top. In that book he explains the role of the central bank as the "lender of last resort". My spin is that while the European central Bank does not get that it's its role to be the "lender of last resort", our central bank (Federal Reserve Bank) does not get it that it should play a role of the "borrower of last resort", could be because there is no book written about it yet (at least nothing came my way). Not surprisingly, you could discover that the same concern of "balancing the budget" was very prevalent in the aftermath of the 1929 crash, as depicted in the "The Great Crash of 1929" book by John K. Galbraith.
Well, after getting the first idiocy out of the way, let me tell you what other idiocy bothers me tonight.
And it bothers me very much. I guess I just can't stand cunning idiots. Two of the candidates attacked Rick Perry for issuing an executive order to vaccinate young girls against HPV (a virus causing cervical cancer and some of the head and neck cancers) in Texas. One of them is sadly a physician, and the second a woman. Michelle Bachmann then went on and on about the great harm and violation of the innocent girls that Rick Perry caused by his order. Well, the problem is that by vaccinating you can prevent majority of cervical cancers and save multiple lives (annual mortality from cervical cancer is 4000 and from head and neck 11000). So, you can see what my problem with those folks is. Unfortunately, Mr. Perry did not handle the argument well and did not bury those two idiots the way he should. In the meantime, while I am still waiting for Ralph Nader, Rick Perry is the only candidate that gained my sympathy and respect.
Just on the side, likely a significant day in the markets today with possible bottom for Europe (US might have bottomed at SPX 1100 a month ago).