There is a secret pipe that runs from the US Treasury, through the Federal Reserve trading offices, into the NYSE. This pipe contains liquidity. When the pipeline breaks, Wall Street goes into a swoon like when the oil pipeline system which reaches into the Northeast was broken during Hurricane Katrina. So the President used the SPR, and put that oil on ships to keep the system liquid. That is how the bailout works, okay? Now the oil dealers in the Northeast realized they could game the system, by counting borrowed oil as their own oil, they told the tankers coming into port, no thanks, we're full, and prices came down. No one wants our oil, the poor tanker captains said!

Now the consumers say money is cheap why am I paying so much for credit? The money crack spreads were widening, which didn't make sense because demand wasn't driving the market. Then someone said we should audit the SPR (not) and someone said we should audit the Fed (not). Now the banks say we have to price credit according to risk, but the Fed doesn't see any risk, they price credit at zero. They know there's plenty of liquidity, but it behooves them to pretend there is a shortage of some kind to allow pricing distortions By pricing credit cheaply they can stimulate the economy, by pricing oil cheaply they can protect the ratio of petrodollars it takes to run their false economy. Of course the shell game only works for a little while, and then the price of oil goes up despite the lack of demand, and the price of credit goes up, despite the lack of new lending

Now the President saw the money pipeline was broken and he shipped money to the NYSE, where the traders gamed the system, as good traders do. Eventually the credit spreads widened despite the lack of consumer spending and no real economic recovery. One day the traders were supposed to give the money back, or the books would be squared, but it was in the best interest of everyone, and not the sellers of credit (savers)to have a fair and free market. Sadly all the real wealth was extracted from the system to pay the gamers of the market, the rentiers, the Goldman Sachs boys in their pin striped suits, and when the stock market finally collapsed because they had bought all their own stock, and no one had any money to buy anything, there was no bottom to the bottom to save them all from themselves. Sadly.

When the candidates were lining up to run for mayor of San Diego a few years ago, one of them proposed a very large package of bond issues to make the city energy self sufficient, within twenty years, (instead of bond issues for new ball parks, and shopping malls). He probably got 2% of the vote. The Republican pro-business candidate won. During the Bush years Republicans were on a pogrom against liberals, one of the small fish caught up in their net was Mike Zucchet, 4th district in San Diego. He was like several of his counterparts environmentally active in local issues. At one point the cities most active environmentalist, Donna Frye won the mayors seats as a write in, but the judge threw it out, the meaning of the word bubble, is? So the process took a setback. Now of course we hear Republicans like Brian Bilbray take a stand against issues like offshore drilling. Do environmental concerns suffer because of partisan political grudges. What happened to this state during the energy scandal when ENRON traders raked us over the coals?

Sure Reagan thought trees cause pollution and ketchup is a vegetable, that's only the tiny tiny tip of the melting ice berg.

Real Dog Poop?

Some of the jobs will come in agribusiness. The massive outsourcing of the US food supply is about to reverse. Prices in agriculture are completely depressed, despite rising commodity prices, some of which is due to ethanol subsidies, and the lack of control over prices, due to the weak consumer. The upcoming credit crisis, (II) too much consumer credit was an effective subsidy which denied agribusiness this pricing power. The rise in food costs will be offset by a drop in energy costs. Agribusiness, distribution and transportation.

Secondarily the pool of labor has gone away, many growers have been forced to machine pick crops they used to pick by hand. Farm machinery, and equipment.

Since most of the US workforce has no background in agriculture, there will be plenty of opportunities, but you can't twitter a carrot and make it grow. There are probably plenty of high tech opportunities in agriculture, this column covers these developments. There is also the newest bio-product, marijuana, which is a medicinal cornucopia for pain and nausea, relief from the side effects of reading our 401K statements. Right now the vast underground economy includes quasi illegal pot being grown indoors. Like prohibition these operations are run like illegal stills. When prohibition ended the beverage business took off.

This report is brutal. Private wages dropped 11 billion? A hundred times as fast as consumer spending? For dessert check out the revisions. This article needs a modified title, like Rational Misexuberance? Cue the stock market rally of yesterday, Oh Yeah Oh Yeah Oh Yeah, and then we see the other team scores, (call em the Bears if you like) the pom poms drop, and its Oh No Oh No Oh No.