Mish's Global Economic Trend Analysis

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• In Praise of Extreme Public Union Lunacy in San Jose
• Libyan Rebels Capture Major Oil Hub; Government Forces Repel Rebel Attacks in Other Cities; How Long Can Qaddafi Hang On?
• Union Divide: Debate Over Public Unions Divides Families; Debate a Good Thing
• Echo Rolled Back

In Praise of Extreme Public Union Lunacy in San Jose Posted: 06 Mar 2011 05:39 PM PST Hardly a week goes by in which I do not see examples of extreme public union idiocy. Nonetheless, it is rare to see an entirely new concept prop up. Here's a new one. Pete Constant, a San Jose Councilman wants to answer his own phone. However, union rules dictate that he have a $70,000 assistant he does not even want. What's even more ridiculous is the union has sent this matter to the courts to resolve. Please consider Internal Affairs: The fight over Councilman Constant's missing secretary At a time when San Jose faces more than a $100 million budget deficit and the prospect of hundreds of layoffs, San Jose City Councilman Pete Constant is battling with a City Hall employees' union over whether he should be forced to hire an administrative assistant. Judge Kevin McKenney of Santa Clara County Superior Court recently ordered that the case be taken to a costly arbitration instead of the state's Public Employment Relations Board -- something both Constant and the city's attorneys had sought. That decision pleased the city's 214-member Confidential Employees Organization, which contends the city was required to confer with the union before Constant decided to eliminate the position. The job -- which requires answering phones, scheduling appointments and making photocopies, among other duties -- pays about $70,000 a year. "My concern quite frankly is not who decides the issues. It's getting a resolution on the core issue, which is: Who should determine how I staff my office?" said Constant, who was re-elected last year to a second term representing West San Jose. The City Council's only Republican contends that residents of the district support his ability to make decisions for them. Besides, Constant said, he prefers to do all of the secretarial work himself, with help from four full-time council aides. Councilman Constant contends that the $70,000 can be better spent on things such as resource fairs, helping neighborhood associations, an online database that updates Constant's office with constituent information and inquiries, and license fees for an iPhone app that allows residents to easily report problems. But LaVerne Washington, president of the employees' association, said it is not Constant's prerogative to create his own "process and procedures," which she said conflict with labor agreements between the city and the union. In Praise of Lunacy I commend the sheer idiocy of LaVerne Washington, president of the employees' association, in pressing this case. LaVerne Washington shows without a doubt why the only solution to this madness is the total repudiation and complete destruction of public unions. I cheer Washington's idiocy because this is just the kind of thing that gets the public riled up against public unions. It will backfire. Union Slave Rules Union rules prohibit citizens from being volunteer fireman, from volunteering to help their schools, from seeking non-union employment, and from controlling their own lives. Now we see union rules dictate a city councilman who does not want to hire an assistant to waste $70,000 hiring one. People cannot yell "fire" in a movie theater, for good reason. For the same reason, union rights to "organize" must stop at the point when they tread on the rights of others to pursue employment, to do whatever they want with their own time, and to not waste money hiring employees they do not need. No one who stands up for the taxpayer in public union contracts. Worse yet, many of those contracts intrude on private rights as noted above. The proper solution is the complete elimination of public unions and all the slavery they stand for. Please see Paul Krugman, Stephen Colbert, Bill Maher, others, Ignore Extortion, Bribery, Coercion, and Slavery; No One Should Own You! for further discussion of the slavery issue. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Libyan Rebels Capture Major Oil Hub; Government Forces Repel Rebel Attacks in Other Cities; How Long Can Qaddafi Hang On? Posted: 06 Mar 2011 09:47 AM PST Yesterday, rebels captured Ras Lanuf, a town 400 miles east of Tripoli, home of a tanker terminal that exports about 200,000 barrels of oil a day as well as Libya's biggest refinery. However, both sides have claimed victories elsewhere, and accurate assessments of precisely what is happening are difficult. Please consider Libya's Rebels Claim Another Oil Hub in Day of Clashes Fighting between Libyan rebels and troops loyal to Muammar Qaddafi intensified as the opposition advanced west from the oil hub of Ras Lanuf toward the leader's hometown of Sirte. Rebel fighters battled Qaddafi's troops today as they approached Sirte, 230 miles east of the capital, Tripoli, said Khaled el-Sayeh, a coordinator between the opposition's military forces and its interim ruling council in Benghazi. State television reports that Qaddafi's troops had recaptured Ras Lanuf overnight were false and designed to "bring down the morale of the youths," el-Sayeh said. The rebels today remained in control of the port, which regime forces shelled with rockets and artillery, the AP reported. Rebels yesterday took control of Ras Lanuf, 400 miles east of Tripoli, where they shot down two helicopters and a fighter jet. The town has a tanker terminal that exports about 200,000 barrels of oil a day. It also contains Libya's biggest refinery, with a capacity of 220,000 barrels a day, more than half the country's total output, according to the International Energy Agency. Rebel Advance in Libya Set Back by Heavy Assault The New York Times reports Rebel Advance in Libya Set Back by Heavy Assault The Libyan military drove rebel forces back along the main coastal road on Sunday, ambushing the advancing militias as they entered the town of Bin Jawwad and pushing them out with tank fire and airstrikes, according to witnesses near the town. The number of the casualties in the battle was unclear, but it set back the rebels' advance just a day after they celebrated a major victory in taking the vital oil port of Ras Lanuf. On Sunday, rebel leaders said they were regrouping outside that city and would begin pushing toward Bin Jawwad again. Just outside the capital, a standoff continued in the rebel-held city of Zawiyah, a day after forces loyal to Col. Muammar el-Qaddafi waged a heavy assault toward the city center and then pulled back to close off all roads out. Nineteen days after it began with spirited demonstrations in the eastern city of Benghazi, the Libyan uprising has veered sharply from the pattern of relatively quick and nonviolent upheavals that ousted the leaders of Tunisia and Egypt. Instead, the rebellion here has become mired in a drawn-out ground campaign between two relatively unprofessional and loosely organized forces — the Libyan Army and the rebels — that is exacting high civilian casualties and appears likely to drag on for some time. That bloody standoff was evident on Saturday in Zawiyah, the northwestern city seized by rebels a week ago, where the government's attacks raised puzzling questions about its strategy. For the second day in a row its forces punched into the city, then pulled back to maintain a siege from the perimeter. Hours later, they advanced and retreated again. By the end of the day, both sides claimed control of the city. In Benghazi, the rebels' de facto capital, the rebels took further steps toward political organization. Their shadow government, the Libyan National Council, held its inaugural meeting Saturday and appointed a three-member crisis committee. While the rebels may have a new defense minister in Benghazi, their fighters on the eastern front did not appear to be taking orders from anyone on Saturday as they pushed past Ras Lanuf, an oil refinery town that they retook from Colonel Qaddafi's loyalists on Friday night. Armed with rocket-propelled grenade launchers, the rebels advanced confidently by car and foot through the desert until a fighter jet was heard. Even a rumor of a jet engine in the distance would send the fighters in a mad dash through the dunes, searching for cover and firing in the air. Slow, Uneven Progress The battle for Libya is now 18 days and counting. The rebels continue to gain territory, then give some back only to take it again. Over time however, they appear to be advancing from multiple directions towards Tripoli. Based on belief that Qaddafi's top military leaders would turn on him, I initially thought this would all be over in a few of weeks. So far that has not happened. Now with both sides disorganized and with rebels increasingly stretched thin as they capture more territory, how much longer this can go on remains to be seen. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Union Divide: Debate Over Public Unions Divides Families; Debate a Good Thing Posted: 06 Mar 2011 01:29 AM PST The debate over public unions has become increasingly intense, to the point of splitting families, even in once-solid union country. Please consider In union strongholds, residents wrestle with cuts In Midwestern union strongholds, residents torn over proposals to curb union benefits, powers. There once was a time when Harry and Nancy Harrington -- their teenage children in tow -- walked the picket line outside the nursing home where she was a medical aide, protesting the lack of a pension plan for the unionized work force. But those days of family solidarity are gone. Harry now blames years of union demands for an exodus of manufacturing jobs from this blue-collar city on the shore of Lake Michigan. He praises new Wisconsin Gov. Scott Walker for attempting to strip public employee unions of nearly all of their collective bargaining rights. "I'm sorry, but the unions want to yell, they want to intimidate," says Harry Harrington, 69, as he sets a coffee cup down next to another newspaper headline about the union demonstrations. "They want to be heard," retorts Nancy Harrington, 66, who fears a weakened union would jeopardize the teaching career of their now 38-year-old daughter. The Harringtons typify the new national reality for labor unions. Support is no longer a sure thing from the middle class -- not even in a city long considered a union stronghold in a state that gave birth to the nation's largest public employee union. National polls show that the portion of the public that views unions favorably has dropped to near historic lows in recent years, dipping below 50 percent by some accounts. In Racine, a nearly two-hour drive southeast of the epicenter of the union controversy in Madison, the question of the union's appropriate role has divided husband and wife, mother and child, co-workers and friends. It's the hot topic on editorial pages, at coffee shops, even at the craft club that meets in the community center at Roosevelt Park, where a dozen retired women recently were talking over the top of each other about union powers while knitting socks and hats. Yet the teachers union is not the power it once was in the Racine area. Despite a well-funded media campaign, the union's candidate, Democratic state Sen. John Lehmen, of Racine -- a former high school teacher -- was ousted by Republican challenger Van Wanggaard in last fall's election. District voters also picked Walker over Democratic gubernatorial candidate Tom Barrett. Debate a Good Thing This debate is a good thing. Debate portends change. Until recently few cared how much public unions and their untenable benefits were raping taxpayers. Now many do, and it's a start. Unions have struck back of course, primarily by the same fear-mongering, extortionist tactics they always have. However, battles like these are not won in a day. Progress continues in Ohio, Wisconsin, Tennessee, New Jersey, and even California. That's a good start. A few years ago the only people talking about these issues were Jack Dean at Pension Tsunami and I. Even now, most bloggers have ignored the issue. Unfortunately, some bloggers such as Yves Smith at Naked Capitalism and Leo Kolivakis at Pension Pulse are on the wrong side of it. The facts are indisputable however. No one speaks for the taxpayer in so-called collective bargaining negotiations Public unions are in power via a constant barrage of extortion, coercion, bribery, and backroom dealing. Public unions have bankrupted countless cities and many states. Public unions and collective bargaining are tantamount to slavery For a look at the slavery debate, please consider Paul Krugman, Stephen Colbert, Bill Maher, others, Ignore Extortion, Bribery, Coercion, and Slavery; No One Should Own You! The more the issues are discussed, the better the chances of change to address the problems. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Echo Rolled Back Posted: 06 Mar 2011 01:15 AM PST A few issues came up with Echo that will prevent deployment this weekend as planned. Will postpone for another weekend. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

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Seth's Blog : Cascade of broken promises

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Cascade of broken promises

... a cautionary tale. It's always easier to make a promise than it is to keep one, and if you're not careful, it compounds.

I got my new Macbook Pro the other day. It comes with Migration Assistant, a flawed piece of software that promises to easily transfer years of old data from one machine to another.

The software failed. (Promise broken). Having paid $99 for the One to One service (which promises individual hour long sessions), I make an appointment and head over to the store. Nate, the promised guide, doesn't know how to fix it, because, despite the promise, he's not trained to do so. He hands me over to a genius, Michael, who hears my story and promises to personally handle it (it takes ten hours to do the transfer, he'll watch over it and make sure it goes well.) He actually looks me in the eye and says, "I promise to personally handle this."

The next day, the phone rings. It's Aideen, who has the case, doesn't know who Michael is and doesn't know what to do. She leaves a message. I call back, talk to someone at the store who insists that Aideen isn't available but that someone will call me back within thirty minutes. He says, "I promise that someone will call you within thirty minutes." An hour later, no one has called back.

It goes on and on. Every employee means well. Every employee is overwhelmed by incoming traffic, most from people who have already had their promises broken. Every employee has discovered that it's easier to make a promise and pass it along than it is to either tell the truth or keep the promise.

The cascade starts with the product. When your brand makes promises it can't keep, your overworked staff bears the brunt.

 

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Seth's Blog : The limits of evidence-based marketing

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The limits of evidence-based marketing

That's what most of us do. We present facts and proof and expect a rational consumer/voter/follower/peer to make an intelligent decision on what's better.

That's how science works. Thesis, test, evidence, conclusion. All testable and rational.

Here's the conversation that needs to happen before we invest a lot of time in evidence-based marketing in the face of skepticism: "What evidence would you need to see in order to change your mind?"

If the honest answer is, "well, actually, there's nothing you could show me that would change my mind," you've just saved everyone a lot of time. Please don't bother having endless fact-based discussions.

[Apple tried to use evidence to persuade IT execs and big companies to adopt the Macs during the 80s. Ads and studies that proved the Mac was easier and cheaper to support. They failed. It was only the gentle persistence of storytelling and the elevation of evangelists that turned the tide.]

What would you have to show someone who believes men never walked on the moon? What evidence would you have to proffer in order to change the mind of someone who is certain the Earth is only 5,000 years old? If they're being truthful with you, there's nothing they haven't been exposed to that would do the trick. I was talking to someone who has a body of artistic work I respect a great deal. He explained to me his notion that the polio vaccine was a net negative, that it didn't really work and that more people have been hurt by it than helped.

I tried evidence. I showed him detailed reports from the Gates Foundation and from the WHO and from other sources. No, he said, that's all faked, promoted by the pharma business. There was no evidence that would change his mind.

Of course, evidence isn't the only marketing tactic that is effective. In fact, it's often not the best tactic. What would change his mind, what would change the mind of many people resistant to evidence is a series of eager testimonials from other tribe members who have changed their minds. When people who are respected in a social or professional circle clearly and loudly proclaim that they've changed their minds, a ripple effect starts. First, peer pressure tries to repress these flip-flopping outliers. But if they persist in their new mindset, over time others may come along. Soon, the majority flips. It's not easy or fast, but it happens.

That's why it's hard to find people who believe the earth is flat. That's why political parties change their stripes now and then. It wasn't that the majority reviewed the facts and made a shift. It's because people they respected sold them on a new faith, a new opinion.

 

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