How much longer does North Korea have?

History is grinding forward if this news report is correct…..

But the food situation, which has mostly been felt in rural areas where rations have been suspended since November, has now spread to the city, according to the South Korean aid agency.

“Even ranking officials have run out of their (rationed) food supply, while a ban on (private) trade is strictly maintained,” said an unidentified city official quoted by Good Friends.

“It is nothing but a death sentence.”

The agency also said farm labourers were staying away from work because they were not getting any food. This was said to be affecting the planting of new crops.

Thats right. Don’t feed the people who are supposed to plant your crops.

Essay of the Week: 3/23/08-3/29/08

It will be a struggle for most people to get through this week’s essay of the week. The essay entitled “The Israel defense forces in the Second Lebanon War: Why the poor performance?” is a seriously academic essay. In practice this means that it is poorly written and full of hard to understand jargon.

Nonetheless, it is worth reading. It is worth reading if you are an admirer of Israel and you think that their military is endlessly capable for it explains the difference between what Israel military is today and what it was in the past. It is worth reading if you have a sick fascination with the MBA culture and its conception of leadership because the essay explains how modern business theory has infected Israeli military thinking.

But most importantly, it is a reminder that technology alone is not enough to ensure the superiority of western cultures. Western cultures must also retain their culture superiority. Failing that, the barbarians will be knocking down the gates.

Poem of the Week: 3/16/08-3/22/08

Poem of the Week: 3/16/08-3/22/08

There are two parts to a great poem. The first is a compelling imagery that should draw you in even before you can quite figure out what it is all about. The second is skillful allusions that bring a whole world of thought to life with a few sparse lines.

The Consolations by Adam Kirsch falls a little short when it comes to the department of compelling imagery. But it makes up for this deficiency by working hard on the department of skillful allusions. On the balance, it does not quite rise to the heights of a truly great poem, but as mediation on America’s current economic problems it has no poetic peer as of yet.

Unfortunately, if you don’t get any of the illusions, this poem can be dismissed out hand. So we recommend that you read up on Boethius before you read this poem (Catholic Encyclopedia and Wikipedia both have good short biographical pieces on him). If you really have time, it would not hurt to read a translation of Boethius’s The Consolation of Philosophy.

But if you have not the time for that, at least read the three places that Adam Kirsch draws direct quotes from. Here is a translation of the song that quote that heads the first section Mr. Kirsch’s poem comes from. Here is a translation of the song that the quote that heads the second section of Mr. Kirsch’s poem comes from. And here is a translation of the song that the quote that heads the last section comes from.

Rant of the Week: 3/16/08-3/22/08

It is a sad fact of life that it is better to be feared then loved. It is hard to find anyone in the developed world who has a bad word to say about the Tibetans. From far left liberals to hard right conservatives, everyone feels sorry for the poor put upon Tibetans. But as EU Referendum points out, that does not stop anyone from selling them up the river to appease China.

Essay of the Week: 3/16/08-3/22/08

It was not what we wanted to post for essay of the week, but sometimes you have to give way to current events. As everyone who has not been living under a rock knows, the major story of the week is the dramatic collapse of Bear Stearns. Since it is likely to heavily influence the news next week, we have decided to make this essay from Naked Capitalism essay of the week.

We do this with reluctance. Naked Capitalism has the best overview of the types of problems that are bound up in the Bear Stearns collapse, but we really think this issue has been overhyped. This problem will not end the world as we know it no matter what the traders on Wall Street think. As long as China, Japan, and Brazil are willing to buy treasuries at almost any price, then the US government will have plenty of money to throw at any problem. When you see a sharp rise in the interest rates on treasury bonds, then you can start screaming if you are so inclined. Until then save your breath.

Don’t get us wrong. The Bear Stearns collapse is not good news. But the thing that has kept this crazy house of cards afloat has been the fact that the US Federal Government has been able to pay historically low real interest rates on its debt even as it was running a record current account deficit and spending money on guns and butter like there was no tomorrow. Until that stops, things will still be reasonably all right in the US.

For that reason, a case could be made that it would be better to select this piece from Econbrowser on the TSLF, this piece from Brad Setser on central bank intervention, or this piece from Demography Matters on China’s inflation and labor shortages. All three of those essays talk about issues that will still be important next year when everyone will have already forgotten about Bear Stearns and are freaking out about other issues.

But since we live in the now, and not in the future, and since most people don’t have the time to read more than one essay in their spare time, it seems best to encourage people read Naked Capitalisms take on the issues raised by Bear Stearns collapse so that people know what the issues are.

Traders are so cute when they get scared

From Reuters….

“You can safely assume that Bear is not alone here,” said an interest rate strategist at one European investment bank in London, who declined to be identified.

“We have been setting prices in swaps markets in recent days that were designed to say ‘no deal’ and at least one other U.S. investment bank — not Bear — dealt. That is very worrying if they needed the cash that badly. We have been forced to review our counterparty limits ever since.”

From the Independent……

A Goldman Sachs trader in New York said: “Everyone is in a total state of shock, aghast at what is happening. No one wants to talk, let alone deal; we’re just standing by waiting. Everyone is nervous about what is going to emerge when trading starts tomorrow.”

In the UK, Michael Taylor, a senior market strategist at Lombard, the economics consultancy, said on Friday night: “We have all been talking about a 1970s-style crisis but as each day goes by this looks more like the 1930s. No one has any clue as to where this is going to end; it’s a self-feeding disaster.” Mr Taylor, who had been relatively optimistic, has turned bearish: “It really does look as though the UK is now heading for a recession. The credit-crunch means that even if the Bank of England cuts rates again, the banks are in such a bad way they are unlikely to pass cuts on.”

Mr Taylor added that he expects a sharp downturn in the real UK economy as the public and companies stop borrowing. “We have never seen anything like this before. This is new territory for us. Liquidity is being pumped into the system but the banks are not taking any notice. This is all about confidence. The more the central banks do, the more the banks seem to ignore what’s going on.”

Mr Taylor added that the problems unravelling at Bear Stearns are just the beginning: “There will be more banks and hedge funds heading for collapse.”