Vigilant Investor

No doubt, there are quite a few problems behind why oil has jumped above $128 a barrel.  Never mind hooey arguments about greedy oil companies that resonate with the economic illiterates among the loudmouth media and the complaining voters.

While we don’t have much good to say about any politician on the matter of energy, we really can’t disagree with President Bush’s observations about pressuring the Saudi’s for more output:

“Our problem in America gets solved when we aggressively go for domestic exploration. Our problem in America gets solved if we expand our refining capacity, promote nuclear energy and continue our strategy for the advancing of alternative energies as well as conservation,” he said.

“One interesting thing about American politics these days is those who are screaming the loudest for increased production from Saudi Arabia are the very same people who are fighting the fiercest against domestic exploration, against the development of nuclear power and against expanding refining capacity.”

This, said Bush, after noting that Saudi output really is not the ultimate solution to the U.S. price problem.  Mind you, many in the U.S. Congress are wagging their fingers at the Saudis — like candidate Hillary Clinton — for not increasing their production significantly enough to alleviate U.S. price pressures, as if the world should rotate around the U.S. dilemma.  The same folks giving grief to the Saudis are the same ones who refuse to allow the U.S. to develop its own energy resources as Bush notes above.

Not that the Republicans have been any great movement as of late to get anything done themselves, with R candidate John McCaine having been a pivotal vote in the Senate preventing the development of Alaskan reserves.  Indeed, the U.S. has not built a new refinery in three decades, and refuses to allow development of both oil and clean burning coal, not to mention nuclear reactors.  Even environmentalists are preventing air windmills, much to the happiness of those with fancy homes on the coasts who loath having their million dollar views ruined by windmill farms harvesting the constant ocean breezes.

Hypocrisy aside, we’re not hearing one of the core causes for skyrocketing energy costs: plain old fashioned inflation. And by “inflation”, we don’t mean the modern misuse of the word to describe the consequences of inflation — rising prices –, but rather the actual cause of the rising prices: climbing money supply.   The world is now awash with dollars thanks to a steady thirty years of the Fed and the U.S. banking system creating dollar after dollar with its fractional reserve, fiat privilege.

Looking at the money supply graph, you can see that the various measures of U.S. dollars have been on a steady rise since the 1980s, and especially ramped up in the 1990s.   Most were lulled to sleep about the ugly effects of inflation due to two factors, both of which served as siren songs for the unsuspecting public and the herd of sheep hitting their record bonuses on Wall Street:

1. Inflating nice asset prices like stocks, bonds, and houses
2. Exported inflation dollars bought cheap goods made abroad, a honeymoon that lasted until the last few years, when foreign nations were flush to the gills with dollars and ready to part with them to buy things that were not so easily printed and common — and very essential, like energy!

When your dealing with an addict, you don’t trust their word when they say they’re going in the right direction when they won’t even admit they have an addiction problem.

That’s the problem with our financial system. Consumers are addicted to credit and money supply expansion policies. Wall Street enjoys the comfy ability to profit from deals financed with money minted out of thin air. The banking system enjoys being able to profit from loaning and deal-making with the money you think is there in the bank, ready for withdrawal when you want it. (No doubt, those banks really love their 10% fractional reserve requirement and having the Fed a the ready bail them out with fresh cash when the de-facto embezzlement is revealed when depositors actually decide to withdraw their supposedly liquid money all at once, as amid bubble-bursting environments they’re wont to do.) And, of course, Washington D.C. loves having a secretive, privately held central bank finance its shortfalls. What politician won’t practically sell the sun, moon, and stars to win an election, to hell with the future generations that will suffer when the tab for said free lunch comes due? Just print the difference, and let some other sucker figure it out down the road.

And that’s the problem. Down the road is arriving leaving us with no good options. And, so, above we have Glen Beck and Ron Paul soberly discussing the issue the other primary candidates pretend doesn’t exist because the only realistic solutions are too controversial to assure victory among the masses of voters, who most assuredly have made it clear they much prefer having their ears anoint with yet even more impossible to promises delivered in language soaked in honey. As such, Ron Paul and Glen beck will be dismissed as they are always, although we’ll admit it is a good sign that at least Glen Beck is catching on.

Nonetheless, the addicts out there– voters included — consider Ron Paul to be among the Tinfoil Hat Wearing Crowd (a title which yours truly has been labeled a few times). So the system continues to conjure up more ways of getting our addict more of the junk he craves, and the Fed — the dealer who has steadily and stealthily pilfered over 95% of the dollars value since its creation in 1913 — stands ready to give the addict his fix.

The addict, no doubt, loves the party — the good times of the high. But even more desperately, the addict wants to avoid the pain of cleaning up his act and enduring the awful reality that is withdrawal. Addicts will sell themselves into prostitution, and worse, to avoid cleaning up. And so, too, our actors in our economy resist reality — choosing instead to prop up asset prices based in fiction — houses, condos, irrationally priced securities –, and systems rooted in fleecing dollar holders and those on fixed incomes for the benefit of the few. Addiction is a bitch.

But we all know, feeding an addiction is not the path to restoring health, and unfortunately our addicted economy is long in the tooth in juicing itself up into artificial cycle-highs and juicing up more in warding off cycle-lows. No doubt our addict economy has swooned a few times; recently it almost fell over during the 2000-2002 fiasco, but for the good fortune of Alan Greenspan standing on the corner telling everyone that he had the good stuff that would make everything OK.

And so the next bubble crashes — a big one — rife with dislocations so massive one wonders if this time the addict will be forced to face reality… or if he’ll make it through another bubble with another fix. If he gets back up to his old ways, I’d not be betting on his good fortune lasting long.

What of the Fed? Congress? The people? The cry for another fix has been heard loud and clear. Its just a waiting game now.

A list of articles worth perusing to grasp the depth of our problems:

• Fed takes boldest action since the Depression to rescue US mortgage industry
• Fears That Bear Stearns’s Downfall May Spread
• Another Source of Quick Cash Dries Up
• Jim Rogers Says Fed Support of Bear Stearns `Outrageous’: Video
• U.S. 3-month bill yield seen lowest in 50 years
• Gold hits $1,010 on flight from paper currencies
• Foreign investors veto Fed rescue
• Wall Street asks who will follow Bear Stearns
• Bear Stearns takeover sparks fresh financials rout
• Dollar Doomsayers Draw Signs From Bernanke Rate Cuts
• Fed Takes New Steps to Ease Crisis:Cuts Lending Rate to Financial Institutions to 3.25 Percent
• Wall Street waits for the next domino to fall
• Luxuries are cheap, necessities are expensive
• Debt Reckoning: U.S. Receives a Margin Call
• U.S. Fed Cuts Discount Rate, Says Securities Firms May Borrow
• Houses are left behind to pay car, credit bills
• CDS sector weighs Bear Stearns backlash

Seems like Sir Al can’t try hard enough to absolve himself from the monster he created with the tools available via The Creature From Jekyll Island. Here are our thoughts on Honest Al’s latest comments.

We will never have a perfect model of risk
(By Alan ‘Master of obvious” Greenspan)

The current financial crisis in the US is likely to be judged in retrospect as the most wrenching since the end of the second world war. It will end eventually when home prices stabilise and with them the value of equity in homes supporting troubled mortgage securities.

Since World War II? Try since the Great Depression. This situation is as if 1930 met 1973 and used a fertility clinic to produce sextuplets.

Home price stabilisation will restore much-needed clarity to the marketplace because losses will be realised rather than prospective.

It will, however, not restore clarity to Sir Al’s amorphous use of the English language to convey something without really saying anything. Look, the pricing mechanism has been so badly distorted — and not just in housing — it’ll take a substantial cleansing to restore any sense of rational order. The Fed’s meddling will do nothing but continue to subsidize the fantasy that is “price” across many asset classes, housing included. Al should know this.

The major source of contagion will be removed.

How so? By propping up prices artificially as is being done as we speak?

Financial institutions will then recapitalise or go out of business.

With whose wealth? With wealth confiscated from dollar holders via every more inflationary credit expansion!

Trust in the solvency of remaining counterparties will be gradually restored and issuance of loans and securities will slowly return to normal. Although inventories of vacant single-family homes - those belonging to builders and investors - have recently peaked, until liquidation of these inventories proceeds in earnest, the level at which home prices will stabilise remains problematic.

Trust may be restored, but that’s badly placed trust if it is through yet another bailout. As for home prices, any price stabilization that comes from bailout is merely fantasy stabilization. With the Fed fixing the price of money, we’ll — expect as many dislocations as you would from some arbitrary panel fixing the price of Corn, gas, or anything else. But this is at the heart of the central planning meddlers in the Fed and Treasury (and their many supporters), who trust price fixing well ahead of free market allocation of scarce resources, some out of misguided economic beliefs, but as many if not more out of being directly enriched by being able to tap into the Fed printing press and create massive personal profits form the privileged.

The American housing bubble peaked in early 2006, followed by an abrupt and rapid retreat over the past two years. Since summer 2006, hundreds of thousands of homeowners, many forced by foreclosure, have moved out of single-family homes into rental housing, creating an excess of approximately 600,000 vacant, largely investor-owned single-family units for sale. Homebuilders caught by the market’s rapid contraction have involuntarily added an additional 200,000 newly built homes to the “empty-house-for-sale” market.

Uhh… Al? How nice of you to comment from the sidelines as if you weren’t the head cheerleader behind this mess? Homeowners were lured in by none other than You, pal. You told everyone that housing was not in a bubble, and denied being able to rationally indentify one even if it was beating you over the head with a lead pipe. You were the one that suggested ARMs were a good way for consumers to go. You were the one encouraging everyone to help the economy by borrowing and consuming more and more.

Home prices have been receding rapidly under the weight of this inventory overhang.

Created by the artificial oversupply of easy mortgage credit, created by YOUR POLICIES!

Single-family housing starts have declined by 60 per cent since early 2006, but have only recently fallen below single-family home demand.

Continue Reading »

NEW YORK — Wall Street was expected to plunge at the opening of trading Tuesday, extending its huge losses from last week and taking more cues from heavy selling that has spread throughout the world. Indicators showed the Dow Jones industrial average was set to fall by more than 500 points when trading begins.Fears of a recession in the United States that could pull down the global economy as well have infected markets around the world, and those declines further unnerved U.S. investors who were unable to trade Monday, when Wall Street was closed for Martin Luther King Jr. Day. Meanwhile, U.S. bond prices soared as investors fled the stock market, and the price of oil skidded as investors dumped futures in the belief that a recession would slash demand for energy.

It looks like the markets are finally taking the credit crisis and recessionary risks seriously. It was as if a switch was flicked at the turn of the year, from “will there be a recession?”, to “Yikes! A recession! How long and how deep?”

Our answer? Deep. Long. And very liquid.
Continue Reading »

For many who are freshly digesting what’s been unfolding in the credit markets and how it all continues to shake out (or fall apart, as the case may be), the situation appears to them as a rogue, unexpected crisis that was only identified as it was unfolding, with conclusive postmortem only possible in hindsight.

After all, when billion dollar mangers, popular economists and analysts, and mega investment banking institutions all appear to be blind-sided simultaneously, what else can we conclude?

To that, we say “hold on a minute!”

Continue Reading »

“The losses of Sentinel Management Group Inc. and its customers “clearly exceed” $200 million and might surpass $350 million because of a “leveraging scheme” and “alleged misconduct” by insiders, according to a report by a forensic accountant examining the Aug. 17 collapse of the Northbrook-based cash-management firm.”

When easy money is flowing from the banking system due to expansive policy, investors (entrepreneurs, homeowners, etc.) grow more careless. That’s part and parcel of an inflationary cycle. The bubble psychology that permeates society sends a signal that everyone is making money and risk is no longer a problem. Continue Reading »

“The US dollar is no longer a stable anchor in the global financial system, nor is it likely to become one, therefore it is time to look for alternatives.”

Fan Gang, member of China’s central bank monetary policy committee, August 29th, 2006

With the recent flight to safety (U.S. bonds and the dollar), the decline of dollar dominance in the global economy seems like a distant concept. Yet when a country that holds nearly $800 billion of your debt is contemplating the end of the dollar era, you had better be considering the options as well. (Don’t forget, the British never foresaw the end of the GB Pound era.)

We don’t know what the replacement will be, but we are fairly sure that the long term trend of the dollar’s decline as a store of wealth will continue to gain momentum.

Moreover, with the Fed publishing white papers questioning the solvency of the U.S. Government thanks to $80 trillion of unfunded liabilities (those are the cumulative costs of all the promises U.S. politicians have made over the last 100 years to buy off voters)… and the clear history of Central Banks and governments working together to deal with solving such insurmountable debts, we can only presume inflation is on the horizon. And when we say inflation, we mean the continued expansion of dollars circulating in the global economy measured in ways that don’t fudge price increases as is now the case with official CPI.

Ladies and gentlemen, it is time to recalibrate how you measure real vs. nominal returns. And it is time you recalibrate your expectations regarding the volatility required to stay ahead of real inflation.

Few can imagine the dollar not being the dominant world currency. We doubt it will lose the role vs. other currencies being equally inflated at a pace to maintain trade parity. But even a backing off of dollar demand for diversification purposes could spell a new era for the global economy.

What? Test Non-Lethal weapons on Americans? That’s the stuff of conspiracy nuts living in Idaho militia compounds, you say?

Not so fast.

It turns out Air Force Secretary Michael Wynne thinks it is a good idea. His target testing audience? Crowd control situations. The purpose? To make sure these weapons are safe for battlefield use!

“If we’re not willing to use it here against our fellow citizens, then we should not be willing to use it in a wartime situation… If I hit somebody with a non-lethal weapon and they claim that it injured them in a way that was not intended, I think that I would be vilified in the world press.”

While the very topic may seem outlandish to you (this will never be allowed to happen, you probably think) , consider that MSNBC.com is currently polling this question — with 28% of the population in favor! The gradual and complacent acceptance of such lunacy being considered as acceptable reminds me of Orwell’s ‘Animal Farm’, and the ready acceptance of gradual authoritarianism for the good of all farm animal society: “No animal shall kill any other animal… without cause.”
It also reminds me of this forgotten, quickly dismissed, - and, more than ever today — terribly inconvenient quote:

“Those who would give up an essential liberty for temporary security deserve neither liberty nor security.”
–Benjamin Franklin

We post this because this is the cultural climate — the way people are thinking today in the U.S. It’s almost as if it has been forgotten that liberty, freedom and free markets — resting with the consensual authority of the individual, not on an all-powerful “ruled by the collective masses” government — made the United States great. Lost is the understanding that liberty and freedom should be guarded jealously; yet it would appear that, for ever more trivial causes, our country is willing to sacrifice it.

Freedom and liberty is not a birthright or an entitlement, and indifferently allowing it to slip through our fingers as a nation will catch up with the country… and its economy… and it is affecting how you grow and protect your wealth.

There’s been much discussed in the news lately about how many graduates are leaving college saddled with large loans that can take over a decade to pay off.

While there are lots of socialist relief-calls coming from those who lament this reality, few are bothering to address a core source of why college costs are going up so much faster than other goods and services in the economy: much of it is financed, and it is through the credit markets that the massive increases in money supply created by The Fed is vented. Hence, as this vast liquidity literally manufactures / prints demand for U.S. debt instruments out of thin air.

Via my consulting practice, I have listened to many parents tell me that they will do anything they can to pay for their kids college education — even those whose own retirement funding is lacking, and whose debt situation is already lopsided. In order to pay for college, they borrow money — which over the last 5-years has been the cheapest it has been in over fifty-years, with the easiest lending requirements in history. Much of it is financed via home equity loans.

The reality is much of that easy lending is the direct byproduct of a vastly expanding money supply. While rising price indicators like CPI are telling everyone that “inflation is under control”, one need only look at the money supply figures from the Fed to see that it has been inflated at a reckless pace… only the consequences have not been evenly spread across the economy, much of it masked via the deficit and cheaply made foreign goods. But in goods and services of highest demand, inflation has been going strong. Education. Healthcare. Now energy.

So, while folks might complain to politicians about how “someone ought to do something about” the rising costs of college and the consequent debt loads, the real solution is getting the Federal Reserve under control.

Just don’t hold your breath on that one. It won’t happen by choice. But it will happen. Vigilant readers know it.

The Washington Post is running a decent article on the current investor retreat from global equities, covering some of the reasons they suspect the markets are reacting the way they have been. Obviously, regular readers of Vigilant Investor knows that there is a lot more than meets the eye to the current environment, and that it is our belief it is only a matter of time before we hit a tipping point where everyone else catches on to the massive shifts taking place under our nose. Leaf through our past few month’s articles if you are interested on catching up on what you need to be watching.

Meanwhile, the Bush administration is continuing its policy in Iran, rooted in the belief that it is the prerogative of the U.S. to police the world, and that every country ought to kowtow to U.S. interests. As such, the U.S. is now urging financial sanctions on Iran to pressure it to become more subservient to U.S. interests.

While we tend to agree more with Continue Reading »

So much in the U.S. economy has been dislocated thanks to the asinine monetary policy being run by the Fed with full support of conventional economists. By dislocated, we mean our finite wealth resources — our capital stock of savings — has been artificially knocked out of its natural place. From that, we can infer that efficiency of utilization has declined, and resources have been wasted. How you weigh the consequences depends on if you are considering from the U.S. perspective or a global perspective.

Now, first time readers of Vigilant Investor may be asking, why is this important? Why should I care? The answer is simple: if the assumptions upon which your investment valuations are based are faulty, it implies that eventually once the market sorts that information out, their will be a correction.

Some might respond, but are the markets not supposed to be efficient? After all, is that not what we are told by modern asset allocation theory, from Wall Street, to Main Street, all the way to mainstream consumer magazines, and on to “Saint” John Bogel of the index heavy Vanguard Fund family?

To that we would respond, at best markets can be efficient only on average, keeping in mind that “average” does not mean “always”, although much of the retail investment industry acts as if the averages apply to everyone and all circumstances. We have come to often refer to this as “What, Me Worry? Syndrome”.

Of course, we are not alone: Warren Buffet once observed Continue Reading »

Arbitrary complexity is the hallmark of the U.S. tax code. If you have the fleets of attorneys and CPAs to handle the load, most any company can make itself more competitive vs. smaller players without the critical mass to play ball. Of course, the tax industry — all those CPAs and attorneys — want the code to be as complex as ever, as well as ever-changing. For without a tax code whose pages stacked are over six feet thick, $ billions of fees would be gone overnight, forcing tax careerists making six and even seven figures navigating such complexity to get real, non parasitic jobs. That’d be a boon to the economy, as those $billions of dollars of troll-bridge tolls would be redirected to more productive purposes.

We could write for hours on the subject, but at this point we’ll just refer you to an MSNBC article that elaborates on the punitive complexity of the U.S. tax code.

Just remember the next time you see jobs going abroad that its not just big labor to blame for the inefficient economic environment that’s been arbitrarily created in the United States. And don’t forget what professions — and their lobbies– benefit the most thanks to the legislation that makes it happen.

Part I of this conversation was posted yesterday.
***

At the moment, it appears that the trend is out of the bag. The most capable appear to be doing what they have always historically done in every other great inflation by choosing a more speculative approach, trying to capture inflation-venting via financial paper assets and commodity related investments. Those with few means will suffer.

But in the face of this all, there are those who say this is all crazy worrying and not a problem. They say our massive trade deficit funded by foreign lending is not an issue since it only reflects that the rest of the world merely acknowledges that the U.S. is the greatest investment environment.

We question that wisdom. It would be one thing if, like in the late 1800s, that borrowing went into infrastructure and productive capacity. Instead, it has been “invested” into SUVs, 52-inch Plasma TV’s., and used to drive home price up to absurdly speculative levels in many regions. Up to this point, there’s been some willingness by foreign CBs to allow for this to help their own economies grow - a sort of vendor financing. But with the U.S. balance sheet deteriorating and becoming ever more dependent on low interest rate debt, that’s a finite proposition with an inevitable endgame.

Many of those dollars have also been invested into a U.S.-Centric Foreign policy, something more than a few foreign governments are finding as harmless of beneficial as a few years ago, what, with talk of spreading a war to Iran, and the protectionist reaction in Congress to the Dubai port deal, and Chinese interest in Conoco.

Related, there are other experts who say the U.S. Federal Deficit is not such a bad problem. Of course, when one applies GAAP accounting principles and requires net present value accrual accounting for Social Security and Medicare, that number grows from an already massive $350 billion to about $3.5 Trillion. While the clowns running the asylum on the Potomac fight over a small percentage increase in taxes, or resist a minuscule cut in projected growth figures, consider this: you could tax 100% of all incomes in 2006 and not have enough money to cover the net present value deficit. Moreover, this is not something the economy can just grow itself out of, especially since the proposed solutions to our economic problems involves the very dose of medicine that is causing the problem. So, rather than facing the reality in stark terms, both parties in Congress and the Presidency mislead and misdirect voters each election, fearing a factual talk will alienate voters.

With that in mind, it might even be a strategic program from foreign nations to encourage the U.S. to over-extend itself to the degree it has by encouraging more and more debt until a debt trap can be sprung, possibly hamstringing U.S. policy objectives much as the sun eventually set on British Empire dominance.

With all that in mind, we believe that the 30-year and 20-year Treasury move in the last week is finally signaling not only the obvious drying up of demand for U.S. debt at such low rates, but perhaps acknowledging a few other things. Perhaps foreigners worry not so much about an overheating of the U.S. economy and the ensuing inflation as many pundits and Fed economists do. Instead, the rest of the world has begun to discount the possibility of an even greater monetary expansion as the U.S. grapples with its inability to restrain overspending on all fronts.

With foreign coffers chalk full of dollar reserves, even a modest decrease in the rate of U.S. debt purchases will set our rates even higher and decimate the longer yield bond investor. Once that is set in motion, the credit bubble begins its unwind. Consumers, businesses and governments will suddenly suffer under higher debt payments and less disposable income. As the cycle goes round, it seems almost inevitable that the Fed will address such a problem with yet another dose of liquidity.

However, as we’ve said countless times, ginning the money supply does not create growth. It redirects capital in directions that it would never have prudently gone, and in the long run it destroys the nation’s capital stores.

With each new dose, its relationship with the economy takes on characteristics of one not unlike the long-term relationship between a Methamphetamine addict and his meth. At first the user gets all sorts of benefits.  But slowly  it takes its toll. The amount needed to get the same results goes up, and eventually the user becomes entirely dependent on getting more and more doses. Eventually, while the user hangs on, the drug takes its toll on the body and mind, slowly destroying any semblance of the human being that was there before. Eventually the user must stop, or die.

Yet few seem to notice or care. For so long the bond markets have charged very little for this risk. The same could be said for the stock market, the P/E’s of which are still well above historic averages; its total market capitalization to GNP is well off the historic charts, as well.

Perhaps the most unusual thing is that, if folks bothered to listen, even Alan Greenspan has appeared to acknowledge some of this. When asked about the complacency about risk, he pointed out clearly the threat:

“Such and increase in market value is too often viewed by market participants as structural and permanent…history has not dealt kindly with the aftermath of protracted periods of low-risk premiums.”

Yet few care to notice. Few care to adjust. Worse yet, as credit bubble expert, Doug Noland, observed, “Nobody has any incentive to slow down this runaway train. Everybody has every incentive to play this game as hard as they can, and it is a self-reinforcing mechanism.”

We urge the vigilant to take caution in the coming weeks and months. The DOW has gone its longest period of time without a 10% correction, the housing ATM for home equity is being shut off. The economy is about to show its true colors. In the midst of it all, irrational behavior seems to be bleeding into the Gold and Silver markets, as well as commodities.

The storm clouds are darkening. The thin layer of dust hiding our recession is about to be blown away. Will these severe structural headwinds finally be acknowledged?

Hold on to your hats!

We wake today to learn that gas prices have jumped about 15 cents per gallon in the past two weeks as silver hits a 22-year high and gold worked back to a three week high of $563, still down from its $573 high water mark in early February.

Meanwhile, Deutsche Bank and other major investment banks are moving large numbers of back-office jobs to India. The Financial Times says those jobs are higher skilled jobs, and the move is designed to “take advantage of the low cost of employing highly-educated staff in India”. Deutsche Bank is moving half of its back-office, while JPMorgan Chase is planning on hiring 4,500 graduates there in the next two year with hopes of moving 30% of its back-office offshore by the end of next year.

Ladies and gentlemen, this is no longer call centers and IT… These are high paying service jobs suffering from universal effects of global labor arbitrage. The West, with its big government promises of free lunches at all levels, with little concern about the crippling costs of chaining them on the back of the economy, is paying a fat bill of its own making.

And so the tangled web weaves itself over to the New York Times, where the headline reads “Retraining Laid-Off Workers, but for What?” The story tells the tale of displaced workers — airline union types arguably not in the leanest of industries — being retrained by local and state governments. Its not going terribly well given the pesky trend of globalism and the lack of anything being done in Congress to stop the flow of jobs abroad. Of course, government sponsored training co-opts hundreds of millions out of the economy where that money might have contributed to jobs instead of taxes — perhaps the NYT ought to Continue Reading »