08:38 – As it turned out, all the discussion about security of digital camera images was moot. When Barbara got home yesterday, she told me that she’d removed our memory card from our DSLR and was using a memory card that belongs to her law firm.
The first 28 chemical blocks are complete, with the exception of 0.1 M IKI (iodine/potassium iodide) solution, which I’m in the process of making up. I actually have iodine and potassium iodide in inventory, so I could make up the solution directly from the two chemicals. But I’m preserving my stock of iodine crystals by working from purchased Lugol’s iodine, which is an aqueous solution of 2.2% iodine and 4% potassium iodide. To get a solution that’s 0.1 M with respect to both iodine and potassium iodide, I have to add a small amount of iodine to the Lugol’s solution and then dilute it. The problem is, it takes the iodine forever to go into solution. So I have a volumetric flask partially full of Lugol’s iodine solution to which I’ve added some iodine crystals. Every time I think about it, I give the flask a swirl. After several days, the iodine will eventually go into solution.
This is all because about three years ago the DEA reclassified iodine as a List I chemical, supposedly to combat illegal manufacture of methamphetamine. All they’ve really done is make things more difficult for people who need iodine for legal purposes. It used to be you could order iodine from any lab supplies vendor. For that matter, you could walk into the outfitter store at the mall and buy a bottle of iodine crystals. Now, anyone who wants to sell iodine has to jump through legal hoops to do so. There are all kinds of requirements, including keeping detailed paperwork on sales. And, if it turns out that the iodine you sell has been diverted to illegal use, you can be held responsible. Finally, the necessary license to sell iodine costs something like $2,500 per year, which means that most companies that used to sell iodine now find it uneconomic to do so.
The “trigger level” for iodine sales is now one bottle containing no more than one fluid ounce of a solution that contains no more than 2.2% iodine. If you go into Walgreens, you’ll find they still sell bottles of iodine solution of that size and concentration, which they can sell without restriction, as long as they sell only one per customer per transaction. But when I order one liter of 2.2% Lugol’s solution from one of my vendors, they have to record the transaction details and provide them to the federal government. In theory, the feds could show up at my door and ask me to provide details about the disposition of that liter of Lugol’s solution. In practice, that’s very unlikely to happen, but even so.
The Euro drama continues, with France increasingly under the gun. Right now, France is desperately worried that it will lose its AAA bond rating. As well it should. If US bonds are no longer rated AAA, no other major country’s bonds should be rated AAA. Rating the bonds of France, the UK, and Germany AAA while the US rating is lower is simply ridiculous. The US is much, much less likely to default on its bonds than any of those other countries, whose economies are in much worse shape than ours. The markets themselves have shown how ridiculous S&P’s rating reduction for US debt is. Since S&P reduced the US bond rating, risk-averse investors have greatly increased their purchases of–you guessed it–US bonds. Yields on US bonds have continued to fall, indicating that the markets think US debt is the safest there is. The demand for dollars is so high that US banks literally don’t want any more dollars from foreigners, because the banks have to pay to insure those deposits. Large US banks have started charging foreigners who want to make deposits. That’s right. Negative interest.
Ha! Leave it to Barbara to find the simple solution while everyone else bickers about technical details. Awesome.
Rating the bonds of France, the UK, and Germany AAA while the US rating is lower is simply ridiculous.
There is some talk that S&P downgraded the US in retaliation for stricter rules on ratings. After all S&P was giving those banks with the known bad mortgage lending practices high ratings. The new rules place restrictions on these ratings and S&P was not at all happy. The budget mess in congress was a perfect excuse for S&P to get even, to flex their muscle.
True or not? I don’t know. But I would most certainly not discount the wrath of the raters in S&P who are seeing their cash cow get chipped away.
“Rating the bonds of France, the UK, and Germany AAA while the US rating is lower is simply ridiculous.”
Depends on how you look at it. If you disregard the financial shell game that the US likes to play, and search around for figures that seem to be neutral and realistic – well, here’s a summary from a couple of different sources (listing only countries large enough to be of importance):
1. Japan – debt 225% of GDP
2. Greece – debt 130% of GDP
3. Italy – debt 120% of GDP
4. Belgium – debt 100% of GDP
5. Singapore – debt 99% of GDP
6. Ireland – debt 95% of GDP
7. United States – debt 95% of GDP
8. France – debt 85% of GDP
9. Portugal – debt 95% of GDP
10. UK – debt 80% of GDP
11. Germany – debt 75% of GDP
Southern European economies may not be the best, but the US has little or no advantage over Germany, Belgium, or even Ireland. What makes the situation worse is the fact that the US apparently plans to continue increasing it’s national debt at several percent of GDP every year for the foreseeable future.
The ratings agencies are useless – as demonstrated by the mortgage debacle. However, they are useless in a very specific sense: they always close the barn door after the livestock has already run off. Dropping the rating on US bonds is only documenting something that has been obvious for quite some time.
Much depends on how one calculates that debt. The US figure you give counts social security obligations, which aren’t a debt in the usual sense. (The social security trust fund holds US treasury bonds, which the government can monetize at any time with zero effect on its debt level.) If US debt were calculated in the same way as those other countries you list, it would probably be in the 35% to 40% range. That’s still horrible, but nothing like those other countries, whose reported debt/GNP ratios are based solely on bonds they’ve issued. Excepting Japan, which is all its own story, if you took those EU countries’ unfunded liabilities for social programs, including retirement and medical, as well as their unfunded liabilities for commitments they’ve made to Euro bailouts, into account, you’d find the best of them is well, well over 100% of GDP.
Oh, yeah. The US has one huge, gigantic, tremendous advantage over most of those other countries. We have a fiscal union as well as an economic union. When Greece or Ireland or Portugal or Spain or Italy gets in deep trouble, they can’t print more Euros. They’re screwed.
“When Greece or Ireland or Portugal or Spain or Italy gets in deep trouble, they can’t print more Euros. They’re screwed.”
Well, the same applies to California–although they seem to think they can print money. And Europe is–every year–progressing to a more pervasive fiscal and legal union which is closer to that of the US. There may be complaints about loss of autonomy, but it is happening.
Moreover, I found that there is a lot less nationalism in Europe than Americans imagine. More cultural and language differences than across the US–to be sure. But everywhere in the US, one finds American flags waving. One cannot go 5 blocks in any town here without seeing several. I never saw ANY German flags outside of the area of the Reichstag–except during the football final cup and in tourist traps. None. Not even on local government buildings outside the area of the Brandenburg Gate. Same on our travels to other countries around Germany.
Yes, there seem to be people everywhere around the globe who favor one spot, and would not think of moving elsewhere (Indiana is particularly populated with such people), just like there are people in Africa who refuse to move to water when years-long droughts occur, even though they have far less–or nothing–to lose by a move than those in Western countries–but then the West has figured out how to bring water to the people, instead of requiring people to go to the water.
The EU walls started falling decades ago, and IMO, it is a misapprehension to imagine that the countries of Europe are so nationalistically belligerent that they want willingly to undermine the economic union they have created. Far more countries wanted admittance than were granted it. The rejuvenation of Poland has been nothing short of breathtaking. When we first arrived, I saw old, old farm equipment left rusting in uncultivated fields everywhere. Now there is nothing like that to be seen and field cultivation equals what I saw in Germany–at least in the areas I travelled through.
And younger people just plain do not care about the hang-ups of their elders. Nobody in my experience in Germany but those older than me, care about a return to the Deutschmark. I knew people in their 70’s and older, who were still converting to Deutschmark to determine if they were getting a good deal or not. How ridiculous to do that after 10 years of Euro currency valuation swings, when the fixing rate was made long before the Euro was even minted and the Deutschmark certainly no longer tracks that.
IMO, the ratings agencies should be abolished and their execs prosecuted. That whole system is corrupt. As Dean Baker has frequently pointed out, the US would have to consciously and willingly stop paying its bond issues for there to be any threat to US debt–and there is no reason for the government to do that, even though the President hypocritically threatened to do so. The government prints the money–what are those agencies rating? the US’ relative intention not to continue minting money?
I have long maintained that the US does not have a corner on the best government in the world. Every country and regional union is a social and political experiment. Some will do better than others. Some are more suited to deal with the peculiarities of a people and their state of affairs than others. And frankly,–after 10 years of living in Europe,–I fear far more for the US than I do Europe. Europe still looks to the long-term, preservation of the middle-class, and fair scale in trade as opposed to conglomerate control. Every day I go to work recording legal proceedings, it is made perfectly clear that the US is so hell-bent on the short-term, that I seriously doubt we can recover from the damage that is doing. One of the biggest hurdles comes from the fact that emphasis on the short-term is supported to an extreme by mandates from the justice system. That is not going to be easy to reverse. Scary.
IMO, countries other than the US are going to resolve their problems a lot sooner than the US will solve its problems. That includes the EU and the current threats it faces. The current–and any–administration’s emphasis on weakening the dollar is going to impoverish us all. In fact, it is–right now. My breakfast at McDonald’s for my early-morning assignments has risen since April from $3.89 to $4.31. The Sunday buffet at the local KFC is up from $8.12 to $8.97 during the same period. Everything else in my life is going up similarly. And the year is not up, yet.
I’ve never understood how the Euro experiment worked as well as it did without up-front political and fiscal union. If political and fiscal union becomes a reality then the peripheral lame ducks will just bludge off the productive centre.
British friends of mine lived in DC for a few years (he worked in the British Embassy) and in 1999 flew over for about a week to do some reconnaissance before their posting. There were flags *everywhere* and if a band somewhere struck up the Star Spangled Banner people would stop dead in their tracks and put their hands on their hearts. My friends wondered what they’d let themselves in for.
For me, anarchism is looking a lot less unattractive. Whether it’s insano regulations about Iodine or taxes and spending going ballistic a way just has to be found to stop it.