AimlesslyChasingAmy

I just want to go on record as saying that my cousin Chris did not die on my watch last weekend.  Although to be honest, it was a classic coin flip situation.  As I frantically threaded my way through the back streets of Austin, Chris was already to the point where he was self-administering an EpiPen to keep from going into shock (think Pulp Fiction).  Chris is something of a family enigma; at least ten years junior to his siblings and the vast majority of his cousins, he was ignored (because he was “too young”), tormented (because we could), and spoiled (when we felt like it).  Perhaps in ultimate revenge, he grew up to be better adjusted than the lot of us.  Although never fully confident with my reads, I was fairly certain the family wasn’t going to be pleased if I let Chris die on the streets of South Congress.

To be fair, I had a far different day planned.  I was going to pick up Chris and his wife Helen (who was in town for SXSW Interactive) and whisk them off for a relaxing late lunch at the Hula Hut.  Just as I was heading out the door, Helen called with “Uh.  Change of plans.  Chris apparently ate something that must have had nuts in it.”  She may have said more, but I was out the door on the word “nuts.”  When I found them, Helen was wearing a delicious pair of red fishnet stockings under her denim peddlepushers and Chris was wearing hives.  He was in good spirits and seemed goulishly pleased with his EpiPen adventure. And to prove that everything was under control, Helen agreed to take these pictures of Chris’ emergency room stay. 

We had a far calmer Sunday, punctuated with a visit to the new Long Center, graced by the music of Mundi, and then off to Threadgills for some comfort food.  Chris ate the Chicken Fried Steak without incident (well discounting the expected clogged arteries).  Our server was Matt, whose weekly poker game is also on Wednesdays.  He plays mostly with the music crowd and I wondered if they were any softer than my mostly contractor crowd.  He said they’d been looking to start up an Omaha game, so cards were exchanged.   

It does look, however, like the economy is about to flat line on Bush’s watch.  This weekend the Fed loaned money to JP Morgan to buy out Bear Stearns for $2 a share.  Stearns was trading for over $60 a share last week but was already fending off rumors of its potentially fatal illness.  Once Wall Street smells blood, it’s a feeding frenzy.  When Wall Street started a run on Stearn’s positions, you could basically stick a fork in them.  They will attempt to do the same with Lehman. 

The Fed is now shoveling shit dollars against the tide; printing money like a bat out of hell and weakening the dollar with every ounce of ink they use.  As the dollar falls, dollar denominated commodities like gold, oil, and wheat rise.  While they are traded in dollars, they are priced in the world market - so adjust to the falling dollar.  Rising food and fuel costs drive inflation and erode consumer confidence and their ability to spend.  Consumers had been using cheap credit cards and home equity to foot their spending spree, but that avenue is clearly toast.  Consumers drive 2/3 of our GDP. All in all, we’ve got the perfect set up for stagflation. 

It’s not to say that there won’t be some investment opportunities out there.  Short term, the volatility may make some money for day traders.  But once mom and pop pull their money out of their 401K investments and stick it into long term inflation indexed bonds (which looks like is already beginning to happen), it will be awhile before the market sees any influx of capital.  And right now, all the long term babies are going out with the bath water - and some of them are going to have to tread water a long long time before someone scoops them up.

I’ve never liked inflation indexed bonds.  Until a few years ago, inflation was like the quad monster hiding under the poker bed.  But stagflation is the quads of economic monsters.  I think for some longer term low risk investors, they might be worth a look. 

Well that’s cheery.  I guess the silver lining is that my break even poker is looking like a better investment of my time every day.  Another silver lining is that Bush was unable to privatize social security.  I feed my cats cat food, but that’s not what I want to be snacking on in my golden years. Just to show I’m bipartisan in my economic disdain: Uh, how do you like the repeal of those provisions in Glass-Steagall now Bill?  Granted the Federal Reserve get’s most of the credit for the current regulatory state of the banking industry.   

Pictures:
1. Chris drinking his charcoal slushy
2. Chris chillin’ in the ER
3. Mundi at the Long Center
4. A recovered Shiner drinking Chris with Eric at the Long Center
5. A shot of the Long Center
6. Parting shot of Chris anticipating his charcoal slushy.  (FYI, He later puked it up, but didn’t tell anyone for fear they’d make him drink another)