Monday, December 29, 2008

Child-like Mischief

Some things are just too troublesome to write about in detail when you stand so close to the events in question. Suffice it to say that this year I decided to get a Toy for Christmas. I purchased a Sony PlayStation 3 (PS3).

In a way this was an act of madness. I bought the player but I owned no games, no
Blu-Ray discs, and no HDTV. I bought it out of anticipation for the release of the Neil Young Archives in 2009.

I plugged the PS3 into my stereo and listened to samples from my music collection. Just by replacing my old DVD player with the PS3, the same music on the same stereo with the same connections sounded better. Significantly better. I was amazed and it was out of that amazement in the improved quality of sound (not image) that I became a child again. I was spontaneous, in the moment, blazing a
karmic path to maximize my PS3 experience.

The path soon included a 42-inch HDTV. This brought with it some complications that I don't care to flesh out. Let's just say after spending an entire Sunday dealing with various issues everything works fine now. (If anyone ever tells you an HDMI cable can't go bad, don't believe them.)

The Earth in Space screen saver that is available while you play music on the PS3 is a high-definition work of art. And it's just a screen saver. (It was because it looked so cool on my old TV that I decided nothing short of a full upgrade would suffice.)

It is amazing to me that the PS3 is suffering in 2008 compared with competitive formats. We have owned a Wii for about a year, for example. It is nothing compared with what the PS3 can do.

My daughter asked for a game to play with it. She got to pick out what she wanted.

This thing is so much fun. It's a Toy.

(But in the background I can't help hearing the echoed voices of Roger Waters, Harlan Ellison, Derrick Jensen, and Kalle Lasn all haunting me in chorus like the ghosts of Christmas, like the wind, timeless Christmas. Get away! Get away! I am a kid! I'm just a kid!)

Thursday, December 25, 2008

Thursday, December 18, 2008

Boink! (At the 50-day Moving Average)

No one knows.

After receiving
a very bearish Dow Theory confirmation in November the stock market immediately turned sharply upward. I was hoping to buy in to a major rise in the markets but I just didn't realize it would rebound so quickly in the face of so much significantly dire global economic news.

I'm certainly no professional at this.

But, as I mentioned in a earlier post, this is the other edge of a high VIX. The market can jump in either direction rather rapidly. From October into November the Dow essentially lost 2500 points. Then from November 21 to December 8 it gained back about 1500 points.

Like a bouncing ball.

A very quick simplified course in chart reading: The chart above was created by me with BigCharts. It shows Dow activity from late September until today. The "blocks" are candlesticks, ways of showing how much the Dow was up or down on a given day. Dark blocks are down days, clear blocks are up days. The two blue bands framing the blocks are the Bollinger Bands. Well over 90% of all stock action occurs inside the Bollinger Bands. The thin tan or brown line sloping gently downwards is the 50-day moving average. I have selected the day in November that the Dow hit its lowest recent low. You will notice immediately after the lowest low the market rallied up.

From there it hit the 50-day moving average and stalled as indicated in the zoomed in portion of the chart below...

The important thing to note from a chart reading standpoint is that the Dow is struggling at the 50-day moving average. You can clearly see that the action from the past few days has hovered right along the descending line of the average. If this is a bear market rally (a secondary move up in the course of a general move down) at some point the Dow has to rise above and remain above this average. So far, it hasn't had enough umph to do that. The good news is that as long as it wanders around the average the market most likely won't break down in the near future.

The primary trend remains bearish, however. The secondary trend is now perhaps bullish.
The Dow Theory bearish confirmation from November remains meaningful and still holds until the market confirms a trend reversal further up - around the 9600 range.

Unless the market remains above the 50-day average then the average will continue to slowly drop. A couple of weeks above the average, however, will cause a shift. This would not be out of the question in the first quarter of 2009.

If the market manages to raise the 50-day moving average trend line then the next average to watch is the
200-day moving average. This average is much more significant as it reflects a longer term view. Generally, the longer the trend, the more accurately it reflects the conditions of things.

Let's pull back now and look at the last two years of the Dow, this time the thin brown or tan sloping line is the 200-day average.

As you can see, the market was pulling the 200-day average up as it rose bullishly, but then the trend curved lower as the bear took over late in 2007. I have selected the most recent highest high for the market on this chart which was over 14,000 last October. Quite a drop in one year.

But there is reason for hope in this graph as well. According to Dow Theory and many charting theories, the further the market drifts above or below the 200-day average, the sharper the pullback will be toward this average. Taken at face value, if we can get beyond the 50-day average, we could be looking at a ride toward the 10,500 range in the Dow before
resistance is met again at where the 200-day average will be at that time.

The VIX is much lower today indicating stabilizing conditions. We are either building support for a greater bear market rally or we are pausing at resistance before the next drop down.

It might turn out the
Jack Schannep's call for a buy in was right after all. Perhaps the Dow is building support enough to break the bear. The best indication might be a trading range around 8500 give or take 500 points. No meaningful Dow confirmations in that scenario.

And that is what the Dow has been doing since December 8.

No one knows. But it is fascinating to watch.

Saturday, December 13, 2008

Time for the (Rain) Deer Flag

I put out our seasonal holiday flag last weekend and we got five or six inches of rain here over two days soon afterwards. I don't remember the last time it rained like that. So, thanks to the flag for bringing us plenty of badly needed rain.

With the holiday season, I lean toward Rudolph (with his nose so bright). Been decorating the house and playing some Christmas music. My Favorite Christmas CD is a classic from the Vince Guaraldi Trio - the music from A Charlie Brown Christmas. Very relaxing but with a nice, jazzy groove to it.
The other CD I enjoy is Burl Ives: Have a Holly Jolly Christmas. I have danced to the title track with my wife and/or daughter at the start of every holiday season since my daughter was born. She used to love me carrying her and twirling around to the music. Now that she's a bit older she acts somewhat disinterested and we have to dance semi-ballroom style. She ends up giggling anyway at the end, however.
So, you put up with the feigned complaining from her along the lines of: "Oh dad not THAT one again" - as if it were an every week thing.

Sunday, December 7, 2008


Well, it being a very substantial dessert, GMC’s fruit cake is still putting up a fight at our home but we are slowly whittling it down. I must confess that the longer it sits the better it gets. We keep several tablespoons of bourbon sealed in the Tupperware container with it. When you open the container now your olfactory organ is treated to a delightful fruity aroma more potent than it was more than a week ago. The stronger tinge of bourbon while eating the cake is most satisfying.

Yesterday, my daughter attended her cousin’s spend the night birthday party about 2 hours south of here. To save time in retrieving her, I met my sister today a little over half way at the locally (and regionally) famous Varsity Restaurant in Atlanta for lunch.

It’s been some time since I’ve had the pleasure of dining at the Varsity. The old joke among my friends was that you need to periodically eat at “the greasy V” (as we call it) to recalibrate your taste buds back to zero.

The Varsity used to serve their take out food in bags that proudly proclaimed “No Food Over 12 Hours Old.” The restaurant (also billed as “the world’s largest drive-in” for those preferring a curbside epicurean delight) is the quintessential definition of “fast food.”

It has a large sprawling dining area that can seat hundreds of people, all emanating from long central ordering counter. You walk up to any of about a dozen ordering stations, wait in line for a bit and then be on your mark when it’s time to place your order.

The Varsity cashiers and cooks aren’t geared for hesitancy and reflection. You best know what you want before your turn arrives. Being a Varsity novice, my daughter couldn’t really decide what she wanted. So she ended up going last instead of first.

“Whatdaya have,” was offered to my sister and I as more of a command than a question. We ordered while my daughter vacillated, which only gave her an additional 30 seconds. She blurted out something unsure of what she was even getting. The cashier grunted.

I had a Number One. That’s two hot dogs covered in their special spicy pulverized chili with a Coke. But the highlight of the meal was the onion rings. Leaving a tiny puddle of grease the bottom of the small paper bowl containing them, these onion rings are the finest you’ll have anywhere.

All three of us had the rings. Ordinarily my daughter detests onions but she scarfed these down without so much as leaving me an expected leftover to enjoy.

It’s a good thing I don’t eat like this every week but there’s nothing like the greasy V.

Thursday, November 27, 2008

The End of the Carson Fruitcake Myth

Grandmother Carson's Fruitcake

For years my in-laws and my wife's other people have discussed in my presence their fond remembrances of a fruit cake made by Jennifer's mother's mother. I knew Grandmother Carson (or, as she is known in the family, GMC). She was a strong, quiet woman, and an excellent cook. In the early years after Jennifer and I got married, we used to go down to Dothan, Alabama to visit GMC and have Thanksgiving there.

Anyway, I never had GMC's fruitcake and all this talk about this fruitcake within my married extended family was as if they had all just eaten a piece last weekend. I accused both Jennifer and her mother recently of making the whole thing up. The damn cake never existed.

So, Jennifer had her mother over here last weekend to make this mythical fruitcake. Now I know why they talked about this cake for two decades without having eaten it.

It takes forever to make. There are so many ingredients but, essentially, there's no cake about it. It almost entirely consists of nuts and fruit. The cost of making a single cake is about $50.

One of the many treasures of this mythical cake is that you fill the hole in the middle of the cake with some good bourbon and let it set a spell. You let the bourbon seep in. So, when you serve it, the cake is this hefty, chunky thing filled with fruit flavors with a faint hint of bourbon, moist yet wonderfully crunchy to eat.

GMC's fruitcake is a rewarding experience and one piece is certainly fulfilling after a great Thanksgiving meal.

The recipe in GMC's hand writing.

I'm blessed that Jennifer can cook like her grandmother. She learned from my dad's mother, Mama Beason, how to make this superb sagey tasting dressing. It is timeless to taste the dressing my grandmother served me every Thanksgiving in my youth.

So, today we had two grandmothers with us for Thanksgiving. Both dead but very much loved through their dressing and dessert. A banner day to end of this fruitcake's myth.

It is every bit as good as they fussed about for 20 years.

Sunday, November 23, 2008

A blossom from the Withered Tree

The Withered Tree in the Court of the Fountain at Minas Tirith

Over the past three weekends my daughter and I have watched the three extended versions of The Lord of the Rings movies. From beginning to end the single film runs about 11.5 hours, so it requires quite an investment in couch potato time.

No problem for my daughter. She loves television and visual arts in general. Nor do I mind being entertained by
Peter Jackson's rather apt interpretation of this Tolkien masterpiece. Seeing how important Tolkien is to me, I think watching these films once every couple of years is reasonable.

The books are better though.

I was introduced to Tolkien when I was 16 by a fellow high school student. I read the novels (including
The Hobbit, the prequel written in the style of a children's story) eagerly. This was also about the same time I discovered Henry David Thoreau. So, all of this coalesced in my fervent young mind as an expanded way of looking at the world. My sense of wonder discovered new boundaries.

The complexity of the fantastic tale, weaving in so many strange characters, cultures, places, and happenings, hinting at being part of this even bigger world (which I did not fully discover until
The Silmarillion was published my first year of college) totally hooked me.

Over the years my appreciation of what Tolkien was doing with the trilogy has deepened and broadened. My first read (I've read the trilogy 8 times) was focused on the story, of course. My next readings concentrated more on attempting to understand Tolkien's vast and varied narrative elements, the places, the names of things, the cultural relationships, the depth implied by the meager aspects of the back-story that was revealed.

Through this first decade of this century, in renewed readings prior to and inspired by the release of Jackson's films, I started to look at the trilogy more mythically. Even though Tolkien is adamant in his introduction to trilogy that there is nothing allegorical about the books, they nevertheless betray larger ideas that Tolkien applied from his life-world. No author can escape himself.

There are several scholarly approaches to Tolkien, many pathways of considerable depth into a long, tragic past leading up to the story of the end of the
Third Age. One I like best has to do with the White Tree in the Court of the Fountain of the Citadel located at Minas Tirith, under the eye of the Stewards of Gondor. This tree is dead, its bark and branches remaining white. After the fall of Sauron, Aragorn finds a seedling of the tree and replants it.

This reseeding does not appear in the movies. Jackson had to understandably cut a lot of stuff out in order to make the film work.

In the book this is what happens: “Then Aragorn laid his hand gently on the sapling, and lo! It seemed to hold only lightly to the earth, and it was removed without hurt; and Aragorn bore it back to the Citadel. Then the withered tree was uprooted, but with reverence; and they did not burn it, but laid it to rest in the silence of
Rath Dinen. And Aragorn planted the new tree in the court of the fountain, and swiftly and gladly it began to grow; and when the month of June entered in it was alden with blossom.” (III, p. 309)

To simplify things Jackson represents this very strong theme of hope by utilizing the withered tree itself. In the scene where Denethor goes to commit suicide the camera pans the courtyard to catch a single white blossom from the tree. This is a nod to a huge aspect of the Tolkien lineage of Time.

One measure of Tolkien can be called the Splintering of the Light.
Verlyn Flieger, a Tolkien scholar, writes: “From the ancient unity to the fragmentation and splintering of light, of perception, of society, and of self, Tolkien’s sub-created world mirrors our own. And through its people, their wars and turmoils, their triumphs and disasters, we come gradually to recognize our world, to see and hear it as Tolkien saw and heard it.” (page 65)

You have to understand that Tolkien was a philologist and before he wrote anything about Middle-Earth
he invented several totally readable and speakable languages. Elven languages, Dwarf languages, even the “Black Speech” of Mordor. Jackson actually sprinkles a lot of these throughout his films. So you get a small taste for all this as a viewer.

Anyway, this is important because these languages, of course, had words and the words had meanings but, most importantly, the words had origins. As a philologist, Tolkien asked about the origin of all these words. On the basis of this rather metaphysical approach Tolkien invented from the bottom up a vast world of cultures and happenings of which
The Lord of the Rings is but the tip of the ice berg.

But, getting back to the Splintering of the Light, I’ll simplify this theme by using Jackson’s interpretation. I will not attempt to explain the complicated back-story. I merely want to show you the vast depth of Tolkien by pointing out this lineage. There are many stories to every aspect of this one theme and this is but one of many paths winding back through Tolkien’s fantasy, so there is much breadth as well – which is what makes Tolkien so unusual. Peerless in my mind.

The White Tree in the film was a seedling, an extremely rare one. It is more than 1500 years old but has been withered for about 150 years. It came from
Minas Arnor which, in turn was seedling of a tree planted by Isildur at Minas Ithil in the Second Age from seeds of the fruit of a tree called Nimloth that dwelt in the King’s Court in Numenor. Nimloth was a seedling of Celeborn, a tree from Valinor, an eternal land set apart, unreachable, from Middle-Earth. The elves of Tol Eressea gave Nimloth to Numenor as a token of appreciation. Celeborn was, in turn, only one of many seedlings of Galathilion the tree that would not shine made by the Valar called Yavanna. All these trees remain outside Middle-Earth. Yvanna modeled Galathilion after Telperion.

Stay with me. Just a bit more.

Telperion was one of
the Two Trees of Valinor, the source of all light in Valinor. Telperion was the silver companion of Laurelin the Golden. These Trees were among the greatest creations of the Valar. They were destroyed in a story too complex to get in to, but their final harvest was fashioned by Yvanna into the Sun by Laurelin and the Moon and stars by Telperion.

The White Tree of
Gondor is the last part of a heavy and very twisted story spanning centuries beyond measure. It is all that is left of the original Light of Telperion. This is a major meta-narrative in Tolkien’s work. The Splintering of the Light reflects Tolkien’s intimate belief in the diminishment of things, the fragmentation of reality from a prior and greater splendor. His version of the Fall of Man and how, according to Tolkien, the Fall continues even now.

Tolkien actually wasn’t the most optimistic guy around. He created this peerless fantasy realm of great beauty and monsterous treachery, fashioning it in such a way as to reflect just the faintest bit of hope. Of course, Tolkien’s catholic faith was his ultimate hope. In The Simarillion and The Lord of the Rings, hope is but an echo of the fragmentation of an original great splendor.

That is why Jackson’s white blossom is so important to the Tolkien connoisseur. We know that blossom goes back to the silver Light before there was a Moon or any stars.

Of course, Jackson’s epic has to concern itself with the “main story” of The Lord of the Rings and not all the diverse depth of the narrative. Naturally, some aspects have been re-arranged to fit the visual dramatic flow. This brought some rebuke from Tolkien purists. But, come on, it's a movie not literature.

To his credit, Jackson managed to work in several of Tolkien's broad themes regarding
the environmental crisis, the meaning of history in the present, the conflict of good versus evil, the fading of original splendor with the passage of time. The fury of the Ents against Isengard, the lineage of the Dunedain, and the re-forging of the sword Narsil into Anduril (an example of how some things do not fade but can return in strength – more reason for hope) are all examples of this in the epic film.

Of course, little of this appreciation for Tolkien was why the movies did so well. The superb special effects and action sequences drew the massive crowds in addition to the ready-made audience that was loyal to Tolkien already.

After all,
very few books outsold The Lord of the Rings in the 20th century.

In that regard Tolkien was, perhaps, the
Author of the Century. And Jackson’s films, within the limits of their format, at least showcase much of Tolkien’s tremendous mythology, if failing to plumb the true depths upon which the trilogy was built.

A portion of a particularly insightful letter from Tolkien detailing the metaphysical basis for his entire body of fantasy can be found here.

Saturday, November 22, 2008

Eating Bambi and the Attack of the Heat Monster

It was 16 degrees this morning. Cold for November. Perfect for venison though. We love to eat deer in various cuts, served in lions or stews. But, last year no one got us one and our freezer ran out before last spring. A neighbor shot one for us in the cold early this morning near our house. Sybil, an elderly lady of some spunk who lives infested with dogs about 1/4 of a mile away, called this morning. She got my wife.

"Jennifer do you want this doe?" she shot out of the blue without bothering to say "hello." "Well, yes we do."

Some good eating for later this winter.

Very dry conditions. The humidity is usually between 25% and 30%. We haven't had rain in weeks (again). The drought drags on. What we have are arid conditions. Lots of bright sunny days. Few days with clouds. It almost to into the 80's in October several days and droppedinto the 40's at night under bright, starry skies.

Today is a typical day for this fall. Another 40 degree difference in the high and the low. Desert like. Clear blue skies, radiant sunshine. It got up to about 55 degrees this afternoon with a slight breeze. I ran 3 miles. It felt good to breathe in the fresh cool air.

Do I have to watch my forest die in these magnificent semi-desert type weather conditions?

As fate would have it, we are redoing our heating and air system. After 15 years it is time for a newer one. But, as usual with us, there were complications. The project is taking about two weeks to complete. Meantime, our heating contractor had his guys place in a 3-ton "window unit". It works great. I'm wondering why we're doing all this other stuff.

Some folks might think it looks tacky though. Two big arms assualting our house.

Wednesday, November 19, 2008

Henceforth, I dub thee The Great Recession

On December 21, 2007, Diana Furchtgott-Roth, the former chief economist for the U.S. Department of Labor (2003-2005) wrote in The American: "On balance, it is not likely that the United States will experience a recession in 2008. Most economic forecasters expect growth to continue in the 2.5 percent range."

No one knows.

Today the Dow and the Transports both plunged through their October lows. According to
Dow Theory (see Nov. 12 post) things are now likely to get much worse for the stock market. The Dow closed down 427 points to 7997.28. The Transportation Index fell an ominous 8% to 3141.52.

I going to go out on a limb and say that this is no ordinary "recession". This is the beginning of The Great Recession. And we better hope it is nothing more.

I googled "the great recession" and hardly anything comes up. Google thinks I mean "the Great Depression". No one seems to think this recession is particularly "great". But, really, don't you find all this just a tad unusual?

There are plenty of web sites that want to call this another Great Depression.
Salon Magazine was among them back in the spring. But, John Mauldin, yet another economist I follow, finds such comparisons lacking.

In Mauldin's recent email newsletter, dated Monday, he wrote: "Sure, if U.S. unemployment is headed to 25%, as it did in the Great Depression, then stock prices might fall in half even from here, as they did by 1932. But this is important - even if stock prices were to fall further, it would not be because of earnings losses that would permanently impair the fundamental value of U.S. companies. Rather, if further losses emerge, it will be because of increases in risk premiums that will be associated with extremely high subsequent returns. Indeed, even though unemployment shot to 25% in 1932, the S&P 500 more than doubled in the year following the 1932 Depression low, and tripled off of that low within less than three years.

"Recent market conditions seem like they have no precedent only because so many investment professionals know only the data they've lived through. If one actually examines market data from the Great Depression, 1907, and other less extreme panics, one realizes how much the recent decline has already discounted potential economic negatives. At this point, further declines in stock prices simply increase the long-term returns that investors can expect over time."

Level-headed? Definitely. Reassuring? Ummm...Mauldin *is* going back 80 to 100 years to find comparisons.

Richard Russell is looking at two levels for support now for the Dow. 7490 which is arrived at by
the 50% Principle (also see Nov. 12 post) and, after that, the 2002 low of 7286.

That's another 500 to 800 points down from here. I'm not expecting it in the next couple of weeks. You figure there has to be some kind of minor rally, we are WAY oversold.

There are two guys where I work that are both into investing. They have both been drooling over the "great values" in some specifics stocks. They tell me this is a "fire sale", it is the time to get in. Buy. Warren Buffet's buying. Shouldn't I be buying?

No, I shouldn't. The reason is the value of individual stocks doesn't matter. It fails to point out what David Brooks noted in my October 24 post, the market isn't about just quantitative analysis. It is, at least equally but in times of crisis more so, about behavorial economics.

This is a major macro-economic situation. Don't you people understand the ENTIRE credit system of the WORLD is still frozen? Don't your realize the Treasury Department didn't do what it said it would with the $700 billion dollars authorized by congress? Don't you realize we still reside under the threat deflation? Don't you realize that after the housing crisis and the financial crisis and, now, the US automobile manufacturer crisis, that probably YET ANOTHER as yet undefined crisis awaits? Don't you realize the government can't bail everything out and offer stimulus packages and it make a damn bit of difference.

"You cannot manipulate or legislate your way out of the primary trend." - basic Dow Theory. And today the primary trend became crystal clear. No ifs ands or buts, this is a Bear Market and it will have its say and we will have a final capitulation. There will be no soft landing.

So, buy your "values" at a $3 or $4 a share and watch them become worth $1.50 or less in a few months. Maybe they'll come back. Maybe they won't. Maybe some other corporation will by the company in which you own $3 stock for 50 cents and you'll lose 83% on the deal. No one knows.

I'll stay heavy in cash. It ain't sexy, but with deflation and a primary downward market trend, I like the unfolding prospects and the ability to move should things stabilize and change.

The only meager hope for the market right now is that VIX (volatility index) remains extremely high at 74.26. That means WILD swings in the near future. The market might go up 500 points one day down 600 points the next. Somehow, over time (and it will now take many weeks if not months), volatility will return to something like "normal" and we could see some stability.

Until then this is either a roller coaster or a train wreck, depending on how you're leveraged.

I'm afraid that Obama's the dog that chased the car and finally caught it. Now what? The Dems inherit the Great Recession. Speeches and impressive press conferences are not the duct tape of the economic realm.

Sunday, November 16, 2008

The Intimate Fritz

I have read the writings of Fredrich Nietzsche since my college days. Like Tolkien and Thoreau, Nietzsche has been a lifelong pursuit.

Today, I finished rereading (been doing a lot of rereading lately) Lesley Chamberlain’s excellent biography “Nietzsche in Turin: An Intimate Biography.” I have several biographies on Fritz the human being, a few others on Fritz’s life as the great philosopher. It is sometimes impossible to separate the man from his writings, but there was a life being lived as the thoughts were being written.

A great example is Nietzsche and his umbrellas. Chamberlain’s biography is the only one in my rather healthy Nietzsche collection that mentions this “intimate” detail.

This short quote regards a young boy named Zuan who played pranks on Fritz:

“Rain or shine, Nietzsche never went out without a red umbrella to shield his afflicted eyes from the light. Over the years other witnesses recalled a grey umbrella and a yellow one. Lou Salome remembered his putting a red shade over the interior light in the Thuringen Forest resort of Tautenberg, near Jena. Zuan and his friends, in their insensitivity, put a handful of stones in the folded umbrella so that when the absorbed thinker opened it the pebbles showered down on his head.” – page 130.

The biography is filled with little nuggets like this. I find them deliciously light, yet full of Being. In that sense they are inspirational.

Chamberlain does a good job of paraphrasing Nietzsche’s unfinished “Transvaluation of all Values”, the work that was to be the summation of his philosophy. She chooses to write about it like this, some odds and ends…

“In a letter of late October Nietzsche speaks of his preoccupation with ‘an uncanny solitary act of transvaluation’. …Nietzsche…counsels psychological insight…urges self-determination…underscoring the chaos of existence…look inwards to find self-understanding…prepared to be out of season…cultivate self-discipline…belong only to themselves…deal with the world out of strength, not out of weakness…drags all that is significant about his past into the eternal present, swelling its rapture…The made self, the enabling power of self-overcoming…that process by which a man discovers himself already in the world.” - from pages 158 – 170

Nietzsche’s profound loneliness and self-chosen sense of isolation defies the fact that other people (who still managed to interact with him even though he gradually filtered everyone out up to his insanity) found him to be pleasant, humorous, entertaining, conversational on diverse topics, clever with his piano playing, and a great person to dine with. The loneliness is real for all of us, but I think Fritz a fool to perhaps turn it into a virtue simply because he was inept at being close with his friends, as Chamberlain shows.

“He knew how to be chivalrous but not how to be intimate,” she writes. – page 133

Chamberlain doesn’t go in to Nietzsche’s madness, only its initial personal manifestations. He banged on the piano in his room at all hours. He got naked and performed “Dionysian rites”. A doctor was called and his best friend came to take him to Jena for medical evaluation. The book ends with poor confused Fritz not wanting to leave Turin, but being won over by false promises from Bettmann, a psychiatric nurse.

Bettmann described the great ceremony waiting to greet Nietzsche as a celebrity at the railway station in Basel. That persuaded the first tragic philosopher, the first and last Dionysian, to leave Piazza Carlo Alberto. But even then Nietzsche lingered outside and begged a last favour from his esteemed landlord: ‘Dear Signor Fino, will you let me have your papalina?’ He wanted Fino’s triangular popish nightcap with tassle for the journey. When he put it on it must have made him look like a clown.” – page 217

Here is an nice short report about Nietzsche's experience in Turin that aired on NPR once.

I usually read more than one book at a time. Simultaneously with Chamberlain, I am rereading Hollingdale’s splendid biography along with a different sort of intimate account of Nietzsche that has been on my bookshelf for awhile going unread. “The Good European” offers numerous intimate details of Nietzsche from the perspective of places he lived and traveled. Lots of photographs attempt to capture his work environment. It is a picture book accentuated by a nice intimate biography filled with Nietzsche's letters and the thoughts of his contemporaries. There are many pics of magnificent places of natural and architectural beauty.

Within the past week, I also have watched a couple of films on Nietzsche, both of them of mixed quality. The lesser of the two is an adaptation of the novel by Irvin D. Yalom, "When Nietzsche Wept". There are some decent moments in the film and small details that only a person familiar with Nietzsche could appreciate. There is also some ridiculously bad acting accompanied by irritatingly created, almost laughably constructed dream sequences. Armand Assante does a respectable job performing Fritz, however.

The better film is artsy, almost like a modern day silent movie set to his writings from Turin at the end of his sanity. The soundtrack is heavily Wagnerian. “Days of Nietzsche in Turin”, a Brazilian film, actually captures the magnificence of the city, the setting for Nietzsche’s short, prolific period where he wrote three major philosophical works in 1888 along with several signifcant minor works before he lost his mind. Though flawed and really only suitable for the Nietzschephile (like me), it makes an excellent visual companion to Chamberlain’s book on the same period of time in his life.

I plan to finish “The Good European” before moving back into Nietzsche’s writings themselves, perhaps beginning with his last great work, Ecce Homo.

Saturday, November 15, 2008

Of Free TV and the Confederate Flag

I think our new high definition antennae looks like something from a 1950’s sci-fi flick. So cool. We can get the Braves games on it out of Atlanta along with about 25 other channels when it faces south. If I turn it north (which I do by hand, who needs a rotary?) we get the Chattanooga stations, about a dozen or so more facing that way.

We paid about $120 for the antennae. From now on the TV is free, though. Just as it was when I was a kid. We get ABC, CBS, FOX, NBC, PBS and a bunch of minor free networks. What we don’t get are hundreds of channels...or a monthly bill. As I mentioned before, I only follow a few TV shows anyway.
The Glass Teat is best kept on a short leash, else we be amused to death.

Our teenage daughter thinks we are cave dwellers in a dark age. She knows no one besides herself who doesn’t have pay TV. Tough.

The retro-look of the antennae goes well with my Confederate flag for some reason. They are both symbols of defiance in their own ways.

For the record, I fly several flags at my house. I have a reindeer flag for Christmas. We have a State of Georgia flag. I’ve thought about getting a
State of Alaska flag. I’ve gone through a couple of American flags. Usually, the US flag flies around Labor Day until the Fourth of July. Sometime closely thereafter I convert to one of my Confederate flags.

The one in the pic was sown together by Jennifer several years ago. A southern wife sewing a southern flag. There’s just something that says “fly me” about that. Aren’t flags meant to be hand sown?

As a native Georgian, one who grew up in the time of the Civil War centennial and cut my teeth on the old tales and myths of the War's grandchildren, the authorities of my grandparent's generation - now all dead, I have always been fascinated by the War Between the States and the Southern Confederacy. 2% of the entire white male population of the US died in that war. One out of every 50 men. As a national trauma, nothing comes close to comparing with it.

My dad's father's grandfather, one of my Confederate ancestors, built the house next to where my parents live today back in the 1880's. He moved to Georgia after the war. My ancestor served in the First Charleston Infantry Battalion, which later merged with other units into the 27th South Carolina Regiment. He fought mostly nearFort Sumter, eventually being sent north to reinforce General Lee’s Army of Northern Virginia. Then he was sent to try to save the last remaining southern port open to the Federal blockade – Wilmington, North Carolina. He was captured in February of 1865. The previous link has an overview of the rather minor military operation in which is was captured.

He never owned slaves. He was doubtlessly racist, as was most all of America at that time. But his motivation for fighting wasn't slavery. Which is one reason it is so myopic to attribute the banner under which he fought as merely a defense of slavery.

James McPherson in his great study of primary sources regarding why men fought the war
"For Cause and Comrades" writes: "It would be wrong, however, to assume that Confederate soldiers were constantly preoccupied with this matter. In fact only 20 percent of the sample of 429 Southern soldiers explicitly voiced proslavery convictions in their letters or dairies. As one might expect, a much higher percentage of soldiers from slaveholding families than from nonslaveholding families expressed such a purpose: 33 percent, compared with 12 percent." - pages 109-110
According to McPherson, it was far more common for southerners to fight for their own "liberty, rights, and the horrors of subjugation." - page 110

"...two-thirds of both Confederate and Union soldiers in the samples expressed generalized patriotic motives for fighting. Likewise an almost identical proportion - 42 percent Confederate and 40 percent Union - discoursed in more depth on ideological issues such as liberty, constitutional rights, constitutional law, resistance to tyranny, republicanism, democracy. Some 53 percent of Confederate officers and 30 percent of Southern enlisted men discussed ideological themes; the comparable figures for Union soldiers were 49 percent and 36 percent." - page 114

Yet these other, more prevalent, reasons for why men fought the war have been removed from the symbolic construct of the Confederate flag. Stolen.

Emory M. Thomas wrote about the importance of a multitude of reasons why the South fought the war in "
The Confederacy as a Revolutionary Experience." He summarized these on page 21: "However distinct from the American mainstream it was or was not, the Southern way of life involved a combination of states rights, agrarianism, racial slavery, aristocracy, and habits of mind including individualism, personalism toward God and man, provincalism, and romanticism."

That's quite an impressive list of "isms" that most people seem to want to condense into the enslavement of a people. Not only is slavery wrong, in my opinion, but so is the attempt to make it the basis for an entire culture's desire to react to a changing world.

I honor my ancestor's bravery under fire in what remains even now our nation’s greatest national crisis. I honor the agrarian culture (the South) that tried to do what it thought was best against a uncertain, increasingly modern industrial culture (the North). I honor the boldness, the sense of dignity and, yes, the arrogance of the southern fighting spirit.

So, since we built in 1994 I have flown Confederate flags at my home. People automatically assume this is with racist intent. This says two things. First, people are herd-like in their understanding of southern history, they are shallow and disconnected from this thing (the flag) that they have formed their ill-informed opinions about. Second, traditional southern symbolism has been stolen by special interest groups, repackaged as pure bigotry, the representations of
a special sense of honor and the original ideals of Jeffersonian America (an agrarian nation dotted by small towns for crafts and distribution with few large cities for necessary industry and trade) trivialized by the thieves.

For it is the most blatant act of thieves to steal a symbol and reduce it to their interpretation as the only “right” one. Thus, the Confederate Flag is the most despised symbol of Americana, a fine example of how free speech…isn’t…if the politically correct hold all the cards.

Screw them. Southern honor and Jeffersonian America have no truer symbol than this flag. History should not be bent to the whims of social criticism masquerading as history. I do not wish to return to the past.
Nietzsche is clear that the past must be overcome and I agree with him. I merely admire the audacity of a romantic worldview at odds with the beginnings of modernity, at war with the inevitable.

The flag sown by Jennifer is technically the
Confederate Naval Ensign. This is due to its proportions. If the white space were about a third longer it would be the Second National Flag of the Confederate States of America.

To me it is the most arrogant flag I’ve ever seen. I like its style. A vast field of white with the
Saint Andrews Cross for a cornerstone.

I voted for Barrack Obama. I hope he brings about great things for American foreign policy and domestic liberties. I tend to be socially liberal, fiscally conservative, which makes me more libertarian than anything else. My support for Obama might seem a contradiction with my pleasure for flying a Confederate Flag. Well, as Faulkner knew, being southern is full of such contradictions. To be southern is to experience a conflicted spirit on many levels. But, in the case of the flag, I personally see no contradiction, as I take the flag as a symbol of something much more complex than a sign of slavery alone.

Be that as it may I just wanted to share this pic of my TV antennae and my flag. Together they give the Finger to the whole wide confused world.

And expressing my sense of symbolism for something I cherish. The freedom to be defiant. The freedom to express oneself and to imbue one’s symbols with one’s intimate values. Otherwise, it’s just the nonsense of the herd, is it not?

So…free TV and free expression. Freedom squared.

Thursday, November 13, 2008

Things that make you go hmmm...

An amazing day on Wall Street. With volatility high, both the Dow and the Transports actually broke through their respective support levels to new lows around 1 p.m. Then things took a decisively bullish turn for the afternoon and the Dow shot up like a rocket from a intra-day low of 7965.42 to close at 8835.25. An astonishing 870 point rise in three hours!

Ditto the Transports. From 3312.31 to 3692.57 after 1 p.m.

Since yesterday's post concerned Dow Theory, I might point out that according to that theory market action is only valid at the close of the day. Action inside the day (or intra-day action) is meaningless. So the fact that the lows were broken before the dramatic rise means nothing in Dow Theory.

Perhaps Jack Schannep is right after all. Happy days are here again?? For the time being, we have backed away from some seriously bad market technical indicators.

The VIX remains very high, however, closing at 59.83. Which means more wild up and down swings are possible.

All this in the face of the
highest jobless claims in 7 years, a reported $230 billion federal deficit, worsening financial conditions for General Motors, and a revenue warning by Intel.

Richard Russell wrote on his web site tonight: "The primary trend cannot be reversed or manipulated, a basic thesis of Dow Theory. The longer the trend is held back, the stronger the frustrated forces of the primary trend. With the Dow closing up over 500 points today, there were only 2 new highs on the NYSE and 614 new lows. Hmmm? You have to question the validity of today's rally."

Wednesday, November 12, 2008

We can't afford a tomorrow like today

Inadvertently, as luck would have it, I chose a historic time to start a blog. In coming years, perhaps, it is not the election of a black man as an American president that will seem "historic." It might well be the economy. The CEO of Merrill Lynch comparing 2008 with 1929? General Motors near bankruptcy? Best Buy warning of "seismic" changes in consumer spending? All this in the midst of an unprecedented credit crisis, in the midst of sharply rising unemployment, in the midst of radically lower commodity prices and general deflation.

Never in my lifetime has so much so bad amassed so suddenly.

I am smart enough to know that NO ONE KNOWS what the stock market will do. No one. But, I have my favorites in terms of ways of looking at things. My favorite economic prognostication flavor is known as
Dow Theory.

As of today two particulars of Dow Theory are prominently in play. First, in a declining market the most recent lowest lows at the market close for the Dow (INDU) and the Dow Transportation Index ($TRAN) are important compasses of future direction. Second, if you take the highest closing high of the market and compare it with the lowest closing low of the market over a period of weeks or months or years you arrive at a number that is halfway between the high and low known as
the 50% Principle.

Now, don't go cross-eyed. Let me explain.

First of all, Dow Theory thinks the Dow Jones Industrial Average (even though it is only composed by 30 major corporations) is a pretty good indicator of how all of American business is doing.

Dow Theory thinks that the Dow Transportation Index is an important measure of how the economy is doing because it measures the profitability of goods (groceries, electronics, recreational stuff, etc.) moving around in the nation. If transportation companies are making money then people must be buying inventory thus forcing retailers to restock. Simple.

Now, let's go back to October 27, 2008. At the close of the market that day the Transports stood at 3364.98. That same day the Dow closed at 8175.77. These are the most recent lowest lows for both averages - so they are the yardstick for now.

Under Dow Theory, if either of these two indexes closes below its most recent low then you look for possible trouble. If BOTH indexes close below their most recent lows then whatever the recent economic picture has been will likely GET WORSE.

You got that? We don't want things to GET WORSE. They SUCK already.

Now, today the Dow closed decisively down over 400 points to 8282.66. The Transports closed down over 159 points to 3474.06. Those are both large declines almost 100 points away from breaking BOTH recent lows.


Thus, if tomorrow is like today things will likely get MUCH WORSE for the rest of 2008...according to Dow Theory.

How much worse? Well that's where the 50% Principle comes into play. The greater the distance in time between the high and the low, the more meaningful the mid-point can be. So, let's go back to when this great bull market started in 1982. The lowest low for the Dow in 1982 was around 776. Yes, that's 7-7-6. The highest high for the Dow was October 9, 2007 when the Dow closed at 14,164.53.

That is an astonishing 25 year period of primary growth. And the mid-point between the 1982 low and the 2007 high is 7470.

So what?

Well, *if* BOTH the Dow and Transports break to new lows in the coming days the next level we would look at from a Dow Theory standpoint is basically another 800 points below where we are today. And if the Dow fails to hold there...well then there's nothing under our feet. We could be looking at another market crash.

But, not so fast...

*If*, say, the Dow breaks to a new low but the Transports refuse and hold above their low then you have a Dow Non-Confirmation, that is the two key indexes fail to agree. It could indicate that the Bear Market doesn't have as much punch as some might fear and it could be a sign that we have reached a market bottom.

From a classic Dow Theory perspective nothing has been proven yet. There is the potential for a market bottom. There is the potential for a crash. Ain't market watching fun? What TV show gives you more uncertainty and thrills than the very real life difference between massive suffering and the next bull run?

Wait...there's just a bit more. You see, even Dow Theory gurus don't agree. I follow two prominent ones.
Richard Russell, who I've mentioned in previous posts, and Jack Schannep, who has written a new book on Dow Theory.

Jack thinks that today's declines placed us in a "second capitulation" for the market, meaning that the sellers are almost exhausted and the market has bottomed out. Jack uses a lot of quantitative analysis to arrive at his predictions.

Unfortunately, on October 7, 2008, Jack told his subscribers to move 25% of their cash back in to the market - which was at 9447.11. He called this the "first capitulation." Then, on October 15, 2008, he told subscribers to go another 25% into the market at 8577.91 - almost 900 points below his buy signal.

I didn't do that. So far, Jack looks kinda off his game. Well, after all, these are unusual times. Richard is more of a "classic" Dow Theorist. He was wrong back in the spring when he said the lows were in for the year and the bull market could be back.

It wasn't. Not yet anyway.

I am grateful to Richard for getting me into gold back in 2002. He is more of a long-term thinker. He is famous for calling the bottom of the great recession of 1974. So, I lean toward his guidance even though Jack has plenty of good information to help me make informed decisions as well.

Regardless of when the low is set, this is a terrific buying opportunity. The only problem is NO ONE KNOWS. So, we wait and see. Will the lows hold? If not how low will we go? If they do hold, however, Jack's advice of investing 50% of reserved cash could be great advice. There are definitely some values to be had in stocks these days.

I'm just not sure we have the "final" capitulation yet. But, I hope so. I'm just not putting any money on it yet.

Friday, November 7, 2008

"Thank you, Mr. President-Elect"

Obama held his first press conference today. It was outstanding. Certainly commendable to history. I was particularly impressed with how he "passed" on the follow-up question concerning if he'd learned anything that "gave him pause" during initial high-level security briefings. I was impressed when he described himself as a "mutt" and when he responded to an apparently French reporter as Obama walked off mic at the end with a "bonjour."

It is (potentially) a new world order conducted in a very "presidential" fashion.

What most impressed me were
the people standing behind Obama at the conference.

The List...

Standing Order From Right to Left:

William Daley - Chairman of the Midwest, JP Morgan Chase; Former Secretary, U.S. Dept of Commerce, 1997-2000
Robert Reich - University of California, Berkeley; Former Secretary, U.S. Dept of Labor, 1993-1997
Penny Pritzker - CEO, Classic Residence by Hyatt
Roger Ferguson - President and CEO, TIAA-CREF and former Vice Chairman of the Board of Governors of the Federal Reserve
Lawrence Summers - Harvard University; Managing Director, D.E. Shaw; Former Secretary, U.S. Dept of Treasury, 1999-2001
Anne Mulcahy - Chairman and CEO, Xerox
Richard Parsons - Chairman of the Board, Time Warner
Paul Volcker - Former Chairman, U.S. Federal Reserve 1979-1987
Rahm Emanuel - United States Representative (IL-05)
Vice President Elect Biden
Jennifer Granholm - Governor, State of Michigan
Robert Rubin - Director and Senior Counselor, Citigroup; Former Secretary, U.S. Dept of Treasury, 1995-1999
David Bonior - Member House of Representatives (Michigan) 1977-2003
Laura Tyson - (Haas School of Business, University of California, Berkeley; Former Chairman, National Economic Council, 1995-1996; Former Chairman, President’s Council of Economic Advisors, 1993-1995)
Antonio Villaraigosa - Mayor, City of Los Angeles
William Donaldson - Former Chairman of the SEC, 2003-2005
Eric Schmidt - Chairman and CEO, Google
Roel Campos - Former Commissioner of the SEC

Thursday, November 6, 2008

Reading, Proust (Again)

A few nights ago I finished re-reading Marcel Proust's lengthy novel In Search of Lost Time. I am a rather obsessive person and that comes in handy when it comes to Proust.

The novel, depending on which translation you read, is well over 3,000 pages long (the edition I just finished was over 3,500 pages). There is a joke about the work that describes it as thousands of pages in which virtually nothing happens. True enough, it can be a tedious read at times. There is one section, for example, that runs on for roughly 250 pages detailing the happenings at a single afternoon party among aristocrats in late 19th century French society. It is actually quite funny, but you can understand why some readers find it so laborious.

In fact, most people who attempt to read Proust the first time fail miserably to make it through more than the first few pages. His sentences seem perpetual. His thought process is winding and twisting and seems to go nowhere at all - or, perhaps more accurately, in far too many directions at once. The first 50 pages or so is about a man trying to fall asleep...a reader's challenge to say the least in these fast-paced, postmodern times of hyperactivity and attention deficits.

I myself tried twice before in recent years to get into the novel only to crash and burn both times. But, in the summer of 2007 something clicked and I finally made it well into the first section of the novel (called "
Swann's Way") while vacationing in Destin, Florida.

There were some things working in my favor besides just being an obsessive person. I have always been a lover of classic literature. My favorite classic novel was
Moby Dick before I managed to successfully tackle Proust. Other great books include the works of Dostoevsky, Tolstoy, Faulkner, Pynchon, and Kundera.

When I was 16 I was introduced to the wonders of
J.R.R. Tolkien's writings. I will perhaps cover that in other postings. Suffice it to say that I have read The Lord of the Rings 8 times. It was clearly one of the most important works of fiction during the first half of my life. I have read everything I could find on Tolkien. His letters, other works, obscure poems, biographies on him, and scholarly analyses of his work.

Another thing that helped me in particular with Proust was that he writes about life as I have experienced it. Not literally, for his novel takes place mostly prior to World War One. But, his attention to detail, his connecting of past experiences with the present moment, his grasp of the necessary aspects of sensual experience in everyday life, his tendency toward a philosophical outlook seasoned with a healthy dose of humor, his sense of history and of the importance of art are all very much a part of who I am as an individual.

At 49, I can say In Search of Lost Time is likely the novel for the second half of my life.

My first reading was rather rushed. In the summer of 2007 I pushed on through the novel, often reading far into the early morning hours, managing to complete the vast sprawling thing in about 60 days. After that (just as I did with Tolkien before) I read a couple of excellent biographies, some guides to the work, Proust's short stories, everything I could put my hands on.

In mid-January of this year I started the whole thing from the beginning again. Only this time I read more slowly, took breaks now and then, read other books in between my Proustian sessions. I completed the work in about 10 months as opposed to 60 days.

What a joy this novel is to read! The second reading was far more entertaining and rewarding than the first. Others who have managed to make it through the labyrinth indicate that the novel gets better the more often it is read. Certainly that is my experience so far. I hope to share some of it in future postings.

The problem now is that I'm in a sort of Proustian void. I'm restless with my reading. Nothing particularly catches my eye. Right now, I am pondering re-reading some Nietzsche...another interest of mine that I'll post another time.

People think me strange since I don't have cable or satellite television. This year I prepared for the next generation of "free" TV by buying a digital antenna (without a rotary). I have never paid for television and I never will. There's simply nothing on TV that I care to watch that much. I follow a couple of shows on the major networks and try to follow the Atlanta Braves games, but that's about all.

Otherwise, when someone looks at me funny for not having cable TV (a rather ludicrous gaze from my perspective since *they* are the ones paying all that money to watch a bunch of commercialized shit) I merely reply "I read."

I read. OK?

Wednesday, October 29, 2008

Four conservatives add up to one vote for Obama

I voted for Barack Obama today. In the end, the substance of the endorsements (rather than the actual endorsements themselves) of Warren Buffett, Colin Powell, and Christopher Buckley over-rode anything anyone else had to say - except for the now obviously loose cannon known as Sarah Palin. Palin's rhetorical spittle of hate and fear against Obama, devoid of issue-based substance, her lack of national experience, and everything this now obviously desperate choice says about John McCain trumped all other considerations for me.

This election will likely be a landslide in Obama's favor. This, in spite of the apparent galvanization of the right-wing of the Republican Party by McCain's choice of Palin. Thus showing for all to see how irrelevant that political force has become. Good riddance (for now) to the politics of hate.

My only reservation about Obama is the absurd amount of money he raised. I think it should be a crime to spend so much money for a presidential campaign. But, the fact is that it isn't. Past hopes of campaign finance reform are left flapping in the breeze. All total, 2008 will be our first billion dollar (+) national campaign...a financial crisis of another kind.

I don't care what the supreme court said. Money isn't speech. That was a horrible decision and it has led to all sorts of present and future madness.