Paul Farrell... WTF?

[metalman]

'WALL-E' and Shiller's new 'irrational pessimism' (http://www.marketwatch.com/news/story/wall-e-right-pessimistic-metaphor-economy/story.aspx?guid=%7B674C03A0%2DB322%2D4CC5%2DABFA%2 D8A50F238A619%7D)
By Paul B. Farrell, MarketWatch
Last update: 7:35 p.m. EDT July 7, 2008

Escape into bubble-thinking on the 'Fatburger Luxury Space Cruise Ship'

We saw similar bizarre "third episode" economic theorizing earlier this year in venture capitalist Eric Janszen's "The Next Bubble" article in Harper's magazine. After analyzing the dot-com and subprime bubbles, Janszen predicted "alternative energy" will be Wall Street's next megabubble, which will then self-destruct around 2013, leaving losses of $20 trillion for investors to "mop up after yet another devastated industry," while Wall Street "will already be engineering its next opportunity."

Notice the flaws common to Shiller and Janszen's bizarre economic theorizing? Shiller predicts we'll first have another "epidemic of excessive financial optimism," then a wave of "irrational pessimism and distrust." Janszen, also sees a new bubble coming in the boom/bust cycle, but then adds that the only way the American economy can exist is if Wall Street's "bubble-blowing machine" keeps feeding on itself, in an accelerating succession of ever-bigger bubbles, ad infinitum.

Unfortunately, both Shiller and Janszen are wrong. Their economic predictions parallel the problems of America's depleted and exhausted military. The Pentagon isn't ready to fight a nuclear WWIII. Likewise, Wall Street lacks the firepower to blow another mega-bubble. After closing Bear Stearns and Countrywide ... writing off what'll eventually be $1.3 trillion ... selling huge equity to sovereign funds ... and now facing a long domestic recession in housing, unemployment and consumer spending ... Wall Street can't finance a $20 trillion "alternative energy" bubble.

But that's not the big reason their predictions are preposterous: Forget that new "third episode" bubble. Forget predictions of a perpetual Wall Street bubble-machine. The real problem is: We need to stop escaping into bubble-thinking and face reality. We're still in a bust cycle, still collapsing, still sinking deeper into a recession. There is no "third episode" ahead, just a dark extension of the "second episode," Wall Street's megastupid subprime-credit crisis.

--

what the **** is this guy smoking? has he ever read this site? did he read the harper's article? he thinks ej likes paulson? guess he missed...

2008 Flying Monkeys of the FIRE Economy Award (http://www.itulip.com/forums/showthread.php?p=38765#post38765)

and the winner is...

http://www.itulip.com/images/FMFE2008.jpg

...and 500 other articles here...

farrel... what an moron.

[jk]

farrell puts ej in good company - robert shiller. farrell's right, too, that ej presents a fundamentally optimistic scenario. the alternative is much darker.

[metalman]

farrell puts ej in good company - robert shiller. farrell's right, too, that ej presents a fundamentally optimistic scenario. the alternative is much darker.

ej... the contrarian's contrarian. pessimistic when everyone else is optimistic, optimistic when everyone else is pessimistic.

the part that got to me is where he paints ej as pro cramer, paulson, and fire econ. that's libel!

[Mega]

But what does he think of SCHIFF????
Mike

[Spartacus]

Same thing as Kunstler (who responded to Eric's Harper's piece that there's not enough money to blow another bubble)

I didn't read Kunstler so I didn't get his tone, but is this guy unnecessarily argumentative, dismissive and rude for a popular media outlet only a little removed from the mainstream?


what the **** is this guy smoking? has he ever read this site? did he read the harper's article? he thinks ej likes paulson? guess he missed...



On Marketwatch I used to like Chris Pummer - so bad he could not even qualify as wrong.

Pummer: Don't buy Gold (in 2003, IIRC) - gold is
anti-productivity
anti-worker
anti-positive
anti-future

blah blah blah .....

[metalman]

Same thing as Kunstler (who responded to Eric's Harper's piece that there's not enough money to blow another bubble)



On Marketwatch I used to like Chris Pummer - so bad he could not even qualify as wrong.

Pummer: Don't buy Gold (in 2003, IIRC) - gold is
anti-productivity
anti-worker
anti-positive
anti-future

blah blah blah .....

remember this?


What will pop the Internet bubble? (http://www.bankrate.com/brm/news/investing/19991129f.asp?keyword=)

So what happens if the bubble pops? The Fed will of course pump up the cash supply again -- "flood the streets with money" as a previous Fed chairman was fond of saying -- as in late 1998 and the early part of 1999. And the bubble picks up where it left off, growing to the next stage of outrageous proportion. As scary as that is, the alternative is worse. If the new liquidity doesn't re-inflate the markets, we crash hard. The result of that unlikely event is a topic for another day.

Posted -- Nov. 29, 1999
<!-- comment template -->

was ANYONE else saying that at the time? farrell has no idea who he's talking to.

[bart]

ej... the contrarian's contrarian. pessimistic when everyone else is optimistic, optimistic when everyone else is pessimistic.

the part that got to me is where he paints ej as pro cramer, paulson, and fire econ. that's libel!

Indeed.

"When you have the law, argue the law; when you have the facts, argue the facts; when you have neither, spew idiocy and worship logical fallacies."

[bart]

Same thing as Kunstler (who responded to Eric's Harper's piece that there's not enough money to blow another bubble)

"The four most dangerous words in investing are, 'It's different this time.'"
-- Sir John Templeton
(R.I.P.)



I didn't read Kunstler so I didn't get his tone, but is this guy unnecessarily argumentative, dismissive and rude for a popular media outlet only a little removed from the mainstream?

Agreed, and a one trick pony too although he does have a few decent points when you wade though all the noise and pessimism.




On Marketwatch I used to like Chris Pummer - so bad he could not even qualify as wrong.

Pummer: Don't buy Gold (in 2003, IIRC) - gold is
anti-productivity
anti-worker
anti-positive
anti-future

blah blah blah .....

"Those who do not learn from history are doomed to repeat it."
-- George Santayana

[algerwetmore]

Actually, I like Kunstler's writing, having just finished his World Made By Hand, a fiction work about the United States, after oil has been exhausted.
He is pessimistic towards institutions, but actually thinks that Americans will revert back to a simpler, more introspective life.
Kunstler is one of many writers, that weave a cautionary tale of what could happen, not necessarily of what must happen.
I particularly enjoy his weekly podcast about the failures of overspending on houses, and lack of emphasis on infrastructure and public transportation.

[zoog]

many of the comments on the marketwatch article are entertaining...:D


You have to rent and watch the 7th Sign, on a Sunday night during the 3rd moon of the lunar calendar, while holding a 2nd edition of Dan Brown's 1st best seller (I can't give that away, or they'll get me!). Farrell has seen the signs ... you have been warned.

-- M. Night Shamalaughingstock
It's so funny to see Paul writing yet another useless article.. really, Paul, comparing our society to a Pixar film is beyond funny. It's hysteria.
It's like thinking "Farenheit 451" by Ray Bradbury is reality.
I don't know why MW keeps him around except for the entertainment value and also the "agitation" value he brings to the site.
WTF? I read this thing a couple times and then a couple more. Maybe when more of the pieces on the site get this incoherent, flakey and loonful we are getting closer to a bottom. But I don't know...
MW is an entertainment site, not a financial site. That's okay, unless you come here thinking you're going to get financial advice that will actually help you.
He took this article almost wholesale from the brilliant NYT columnist Frank Rich's article last Sunday. Read that for the real thing.I have not read the "brilliant" NYT article so dunno about that.

[jk]

many of the comments on the marketwatch article are entertaining...:D

I have not read the "brilliant" NYT article so dunno about that.
the frank rich column was good, as his columns are always, but hardly his best.

[Brooks Gracie]

I recently read a decent case for avoiding an alternative energy bubble, based on the incredible move toward energy independence that Brazil has undergone. The thrust of the piece was that they have cars that run entirely on ethanol (or methanol) made from their copious sugar production. Why hasn't that been tried here I wonder? Detroit could sure use a boost if they could sell these types of cars, and we ought to be able to grow enough sugar/corn/bio-mass to produce such quantities of fuel. Maybe even eliminate the unconscionable sugar price supports.

The other thing that I am amazed about is that we are doing virtually nothing to convert our economy into a nuclear based power-supply economy. No electric cars yet, even though our cities are so full of short-trip drivers. Uranium mining stocks aren't skyrocketing like I expected they would.

I know a bit about EJ's background from past dealings with him in the VC world, so maybe he has some inside information about what the funds are investing in alt-energy, which might indicate a bubble forming. He certainly is more connected to that crowd than I am at the moment practicing law.

The expected bubble could be a very good thing if it spurs actual innovation and results. For example, I wouldn't be writing this and you wouldn't be reading it if it weren't for the telecom and internet bubble. Real, rather than FIRE economy bubbles which increase productivity, don't worry me a shred.

[metalman]

I recently read a decent case for avoiding an alternative energy bubble, based on the incredible move toward energy independence that Brazil has undergone. The thrust of the piece was that they have cars that run entirely on ethanol (or methanol) made from their copious sugar production. Why hasn't that been tried here I wonder? Detroit could sure use a boost if they could sell these types of cars, and we ought to be able to grow enough sugar/corn/bio-mass to produce such quantities of fuel. Maybe even eliminate the unconscionable sugar price supports.

The other thing that I am amazed about is that we are doing virtually nothing to convert our economy into a nuclear based power-supply economy. No electric cars yet, even though our cities are so full of short-trip drivers. Uranium mining stocks aren't skyrocketing like I expected they would.

I know a bit about EJ's background from past dealings with him in the VC world, so maybe he has some inside information about what the funds are investing in alt-energy, which might indicate a bubble forming. He certainly is more connected to that crowd than I am at the moment practicing law.

The expected bubble could be a very good thing if it spurs actual innovation and results. For example, I wouldn't be writing this and you wouldn't be reading it if it weren't for the telecom and internet bubble. Real, rather than FIRE economy bubbles which increase productivity, don't worry me a shred.

did a google search to find an interview with ej by wired on the harper's article. did a good job. found that...

http://www.wired.com/science/planetearth/news/2008/03/cleantech_bubble

...and a few others, too :eek:

http://www.eurozine.com/articles/2008-05-19-janszen-de.html
http://loans.bg58.com/2008/05/catching-next-bubble.html
http://questionmainstreamedia.blogspot.com/2008/05/new-bubble-cycle-in-decade-long.html
http://woodeneyes.wordpress.com/2008/05/06/the-future-never-arrives/ (good luck following that one)
http://steve-thelifeof.blogspot.com/2008/05/next-bubble-priming-markets-for.html
http://pangrammaticon.blogspot.com/2008/05/monetary-kulchur.html
http://sbyrnes.tumblr.com/post/33591831/the-next-bubble-priming-the-markets-for-tomorrows
http://vegashomes.livejournal.com/1870.html
http://politikly.com/2008/05/03/the-next-bubble-priming-the-markets-for-tomorrows-big-crash/
http://digg.com/business_finance/The_Next_Bubble_Priming_the_Markets_for_Tomorrows_ Big_Crash
http://www.ex-christian.net/index.php?showtopic=23587
http://nclgblog.blogspot.com/2008/05/financialization-of-capital-and-crisis.html
http://mymaritimeblog.wordpress.com/2008/04/30/bubbles-and-history/
http://disinter.wordpress.com/2008/04/29/al-gore-profits-from-his-hoax/
http://www.buzzflash.net/story.php?id=50155
http://www.columbusdispatch.com/live/content/business/stories/2008/04/05/business_books.ART_ART_04-05-08_C10_B69QNVR.html?sid=101
http://tywolosin.blogspot.com/2008/04/great-article-thanks-to-kadira-for.html
http://www.counterpunch.org/cox04222008.html
http://buystocksinfoblog.blogspot.com/2008/04/catching-next-bubble.html
http://blog.marsdd.com/2008/04/18/the-first-order-of-business-is-conservation/ (recommended)
http://www.forexhound.com/article.cfm?articleID=93596 (recommended)
http://www.rapidtrends.com/blog/2008/04/16/how-long-can-us-households-hold-out/
http://seekingalpha.com/article/72149-catching-the-next-bubble (recommended)
http://easygraphs.blogspot.com/2008/04/new-buble-in-making-alternative-energy.html (recommended)
http://www.inveslogic.com/sectors/directory/etf-investor/1034608?rsstype=tag&tag=alternative-energy
http://www.safehaven.com/article-9954.htm
http://investmiddleway.blogspot.com/2008/04/next-bubble-by-eric-janszen.html
http://fullyarticulated.typepad.com/sprawledout/2008/04/investing-in-ra.html
http://www.pacificviews.org/weblog/archives/003462.html
http://www.blog.joetaxpayer.com/archives/116
http://www.boston.com/realestate/news/blogs/renow/2008/04/the_problem_of.html
http://futuryst.blogspot.com/2008/04/warning-this-product-might-not-actually.html
http://www.debtdeflation.com/blogs/2008/04/09/the-daily-telegraph-terrorises-the-rba/
http://news.goldseek.com/GoldSeek/1207580144.php
http://www.plentymag.com/features/2008/04/clean_tech.php
http://blog.smartgrowthamerica.org/?p=150
http://articles.latimes.com/2008/mar/26/entertainment/et-bizbooks26
http://www.publishersweekly.com/article/CA6544016.html?industryid=47146
http://zompist.wordpress.com/2008/03/24/the-bubble-economy/
http://thefloat.typepad.com/the_float/2008/week13/#entry-47456152 (recommended)
http://lichuan.wordpress.com/2008/03/23/greenery/
http://www.washingtonpost.com/wp-dyn/content/article/2008/03/21/AR2008032102740.html
http://market-research.typepad.com/fuel_cell_market_report/2008/03/o-look-a-nucule.html
http://thegies.typepad.com/runtosurvive/2008/03/google-launches.html
http://www.xlml.com/aehso/2008/03/20/all-asset-hyperinflations-revert-to-the-mean/ (recommended)
http://imaginecreate.livejournal.com/430877.html
http://www.portfolio.com/news-markets/top-5/2008/03/18/Clean-Tech-is-Only-Hope (recommended)
http://www.defiantone.com/2008/03/18/green-technology-our-salvation
http://www.memestreams.net/users/flynn23/blogid10326157/
http://www.kizo.com/2008/investor-eric-janszen-says-clean-tech-is-collapsing-economys-only-hope/
http://freddevan.com/wordpress/archives/19128
http://flimsysanity.blogspot.com/2008/03/bubble-mentality.html
http://oofboofsay.blogspot.com/2008/03/next-bubble.html
http://edcone.typepad.com/wordup/2008/03/fictitious-valu.html
http://www.smartmoney.com/stockwatch/?story=199908122
http://www.earthportal.org/news/?p=936
http://www.bertarcher.net/?p=710
http://bigbigbet.blogspot.com/2008/03/fizzle-part-2.html
http://hobnobblog.com/2008/03/bubbles_housing_and_the_next_b_1.php
http://www.theunion.com/article/20080312/OPINION/276764024
http://dustinbouchblog.blogspot.com/2008/03/next-bubble.html
http://darwiniana.com/2008/03/10/the-next-bubble/
http://billtotten.blogspot.com/2008/03/next-bubble.html
http://www.thesequitur.com/content/view/2128/43/
http://www.thepropertypin.com/viewtopic.php?p=61527#61527
http://www.sctimes.com/apps/pbcs.dll/article?AID=/20080302/OPINION/103020010/1006/NEWS01
http://blog.case.edu/singham/2008/02/29/the_brave_new_world_of_finance14_the_next_bubble
http://www.early-retirement.org/forums/f28/interesting-bubble-recession-article-33611.html
http://www.greentaxi.com/?p=539
http://www.moonofalabama.org/2008/02/alternative-ene.html
http://www.txsz.com/article1086
http://takethe5th.com/wp/?p=55
http://gailjonas.blogspot.com/2008/02/bubbles-and-obama.html
http://persona-non.blogspot.com/2008/02/economy-on-fire.html
http://pppad.blogspot.com/2008/02/alpha-beta-ding-dong.html
http://rustyidols.blogspot.com/2008/02/next-bubble.html
http://futureenergyinvesting.typepad.com/future_energy_investor/2008/02/looking-more-cl.html
http://newautocars.blogspot.com/2008/02/truth-about-cars-eric-jantzen-get-ready.html
http://www.energybulletin.net/node/40268 (recommended)
http://www.cogitamusblog.com/2008/02/must-read.html
http://airamerica.com/maddow/node/3171
http://www.brian-moffatt.com/bmosblog/?p=82
http://www.canada.com/ottawacitizen/news/arts/story.html?id=bac4b084-51c0-44a3-82c8-5fb5a392efba&k=69072

[Spartacus]

It won't help the US economy.

Who'll make the new cars? GM? Before or after they go bankrupt?

Who'll make all the stainless steel pipes and fittings to handle the ethanol/methanol? Probably China, don't you think?

Go down the line ... who will benefit, whose ox will be gored?


I recently read a decent case for avoiding an alternative energy bubble, based on the incredible move toward energy independence that Brazil has undergone. The thrust of the piece was that they have cars that run entirely on ethanol (or methanol) made from their copious sugar production. Why hasn't that been tried here I wonder? Detroit could sure use a boost if they could sell these types of cars, and we ought to be able to grow enough sugar/corn/bio-mass to produce such quantities of fuel. Maybe even eliminate the unconscionable sugar price supports.

[Mega]

LOTUS (Britian's leading R+D as well as Sports car company) say it would cost an average of £60 to make a car "Duel-fuel" (E85).
Mike

[kingcopper]

GM's already making the flex-fuel vehicles. In fact, most of their new sales of SUV's are flex-fuel now. The problem is getting the ethanol. It doesn't matter anyway, the future is electric or electric/air compressed with a touch of oil to get yah goin. The air compressed engines are extremely efficient and extremely GREEN. What we should be doing on this site is pooling our brains and $ and WE'LL make our own better version for mass production.

[metalman]

GM's already making the flex-fuel vehicles. In fact, most of their new sales of SUV's are flex-fuel now. The problem is getting the ethanol. It doesn't matter anyway, the future is electric or electric/air compressed with a touch of oil to get yah goin. The air compressed engines are extremely efficient and extremely GREEN. What we should be doing on this site is pooling our brains and $ and WE'LL make our own better version for mass production.

that's what ej promises over in the subscription area. says cash/gold spec in shorts for now, alt energy plays later.

[GRG55]

GM's already making the flex-fuel vehicles. In fact, most of their new sales of SUV's are flex-fuel now. The problem is getting the ethanol. It doesn't matter anyway, the future is electric or electric/air compressed with a touch of oil to get yah goin. The air compressed engines are extremely efficient and extremely GREEN. What we should be doing on this site is pooling our brains and $ and WE'LL make our own better version for mass production.


Really? Where does the energy come from to compress the air?

[bart]

Really? Where does the energy come from to compress the air?

Harness the hot air from political capitals of the world?

[metalman]

Really? Where does the energy come from to compress the air?

silly question, grg! that's easy.

1. stomp on one of these...

http://mirror.altrec.com/images/shop/photos/BRA/3774_m.jpg

10,000 times until you've filled one of these...

http://img.alibaba.com/photo/50139052/5_Gallon_Air_Tank.jpg

for energy eat 100 boxes of this...

http://www.wackypackages.org/stickers/4th_2006/realproducts/cornflakes.jpg

with 20 gallons of...

http://novocreamseparators.com/milk.jpg

that takes a bunch of these...

http://streetknowledge.files.wordpress.com/2008/04/cows_69.jpg

that eat a lot of this...

http://brown.osu.edu/ariculture-natural-resources/HayField.jpg

that takes a lot of this...

http://kangenwatermusic.files.wordpress.com/2007/03/water.JPG

and this...

http://www.noble.org/Ag/Economics/FertilizeOrNot/Fertilizer.gif

and tons of this...

http://www.bgs.ac.uk/mineralsuk/images/oil_rig.jpg

to grow.

or i could just walk.

[Spartacus]

Indian food.


Really? Where does the energy come from to compress the air?

especially the chick peas

and especially the Kidney beans

and especially the idlis

I'd better stop before I list every Indian dish.

[metalman]

Indian food.



especially the chick peas

and especially the Kidney beans

and especially the idlis

I'd better stop before I list every Indian dish.

very good!

skip the pump and the tank and corn flakes, milk, cows, fertilizer and oil and go right to the methane production! now that's efficiency!

http://www.germes-online.com/direct/dbimage/50226820/Small_Red_Beans.jpg

http://bp0.blogger.com/_f1WjIOgr7sg/RaaAJN-U0gI/AAAAAAAAAy0/5gvPTjU7AfM/s400/funny_fart.jpg

[bart]

very good!

skip the pump and the tank and corn flakes, milk, cows, fertilizer and oil and go right to the methane production! now that's efficiency!

http://www.germes-online.com/direct/dbimage/50226820/Small_Red_Beans.jpg

http://bp0.blogger.com/_f1WjIOgr7sg/RaaAJN-U0gI/AAAAAAAAAy0/5gvPTjU7AfM/s400/funny_fart.jpg


:D :D :D

Damn!

There's usually only one or a maximum of two in a crowd.

iTulip rules!