Boom, Bust and The Seven Cows

Various friends have written to me regarding the recent financial turbulence and have asked me for my view on what I think will happen. Well, sorry guys, I’m no prophet. No-one can see the future.

Right?

Then Pharaoh said to Joseph, "In my dream I was standing on the bank of the Nile, when out of the river there came up seven cows, fat and sleek, and they grazed among the reeds. After them, seven other cows came up—scrawny and very ugly and lean. I had never seen such ugly cows in all the land of Egypt. The lean, ugly cows ate up the seven fat cows that came up first. But even after they ate them, no one could tell that they had done so; they looked just as ugly as before. Then I woke up."

Then Joseph said to Pharaoh, "The dreams of Pharaoh are one and the same. God has revealed to Pharaoh what he is about to do. The seven good cows are seven years, and the seven good heads of grain are seven years; it is one and the same dream. The seven lean, ugly cows that came up afterward are seven years, and so are the seven worthless heads of grain scorched by the east wind: They are seven years of famine."

Genesis 41 - Pharaoh's Dreams

Previous empirical analyses of U.S. stock index prices show overwhelming evidence of a seven-year wave in the stock market that is part of the overall economic cycle. This cycle is synchronized with the widely known Kondratiev wave that is thought to be fifty to sixty years in duration. The economic cycle runs through four main stages on about a seven year cycle. It goes boom, bust, stagnant, recovery and then repeats ad infinitum.

The economy last hit rock bottom in November 2001. Despite the amazing global economic expansion since then, seven years later (give or take a month or so) here we are again.

According to the economic theorists, this would now put the recovery at around 2015, which by sheer coincidence (?) is what Suze Orman (whom Stephen called the “seer of seers”) predicted in an unguarded moment.

Seven good cows, seven bad.

Who says the Bible can’t predict the future, eh?

amy 735

Amy

And that’s the last I’m saying about money matters for a while. Many of you will no doubt be relieved to hear it.

(BTW, in case anyone is wondering, no I'm not religious.)

Money Mayhem

What has a front has a back. The bigger the front, the bigger the back.

Macrobiotic theory

Sorry folks, no photography today. I know, I know, this is a photography blog, not an economics blog. However I’m a money-woman by trade, so I’m just sitting back today and watching the financial world collapse around my ears. So far the FTSE 100 has fallen 5% today. The Dow Jones is about to open. Things are going to get pretty nasty.

Hot on the heels of Fred and Fannie, Lehman’s could be enough to trigger a catastrophic economic collapse, similar to Black Thursday which triggered the start of The Great Depression. Am I being overly alarmist? Well, that rather depends on how the US Government reacts to this latest crisis.

Barack Obama commented that the Lehman bankruptcy posed "a major threat" to the US economy. Of course he blamed the Bush administration's economic philosophy and said, "This turmoil is a major threat to our economy and its ability to create good-paying jobs and help working Americans pay their bills, save for the future and make their mortgage payments." No kidding, Barack. Really? So how are you going to fix it, eh?

One thing’s for sure, the fallout from this ongoing financial turmoil will be huge. Socially, financially and politically, the world will never be the same again.

Althaia 1377

Althaia contemplates the latest banking collapse

Furious about Fuel

Petrol (that’s gas to you Yanks) is set to tip £1.30 a litre this week. That’s approximately $11.70 USD an imperial gallon in US-speak. Gulp!

As my favourite economist Merryn Somerset Webb wrote this week, each litre of petrol sold in the UK is taxed at a flat tax of 53.65 pence per litre (for US currency, that’s $4.83 USD per gallon) which is one of the highest fuel taxes in the world. On top of that, we also pay VAT (sales tax) of 17.5% when we buy fuel, not just on the cost of the aforesaid fuel but on the tax too. So we pay TAX ON TAX! Of course, we are paying out of income which has already been taxed twice (income tax and national insurance, which isn’t insurance at all, it’s just another tax.) So how many times has my tank of fuel been taxed? Three or four? (I’m losing count.)

In the UK, people are cutting down on car trips, and in rural communities such as ours, people can’t afford to heat their homes. That’s O.K. at the moment because it’s summer, but what happens when winter bites? Last month our village was riddled with thieves stealing heating oil from domestic oil tank stores. People are getting desperate.

Fuel costs are affecting folks all over the world, of course. Everyone is suffering, so we’re not alone. And it’s causing food prices to rise too. Our major supermarket Tesco is rationing rice this week - in the U.K.!?! Astounding. But everyone knows things are getting bad. This is not news. This is reality, and as the saying goes, deal with reality or reality will deal with you.

So what does this have to do with photography? Well, the oil situation probably might not affect many of you yet, but for us personally, like many other U.K. photographers who shoot for fun, we have young to feed and we’re perilously low on dosh. Putting it bluntly, we are self-employed, and we fund Fluffies from our spare cash. We do it 'cos we love it, and we adore making art (or trying to make it anyway.) As it stands today, we have two more shoots booked. After that our photographic reserves run out, and there will be no more new nekkid chix gracing this blog unless some kind laydeez decide to lend their beauty for the higher purpose of creating Art. Failing that, you’re stuck with my ass, I’m afraid (the rest of my body has left the building.)

Oil is predicted to top $200 a barrel by Christmas. As Starbuck from Battlestar Galactica says, “We’re completely fragged. Where’s it going to end?”

AlexisSummers 957

More Alexis from a couple of weeks ago.

Art, Attire And Austerity

An economic fashion post. No nudes either. Yikes! Grim stuff.

In case you’ve been wondering what on earth has happened to the blog this past week, I’ve been celebrating a week of economic and artistic doom and gloom. Yes indeedy, recession fever is hitting the UK pretty bad at the moment. Economic statistics are miserable, our Prime Minister is miserable, the unwashed masses are broke and miserable, and most importantly, fellow photographers and artists are universally and extremely broke and miserable.

This nationwide aura of gloom will undoubtedly be reflected in all areas of society and art. Despite the fact that photographers and artists tend to go for the Te audire no possum, musa sapientum fixa est in aure approach (I can't hear you. I have a banana in my ear,) nevertheless it’s inevitable that wider economic worries affect artists’ moods. The tendency at the moment is towards dark art (hurrah! My favourite!) and I suspect this sombre trend will be reflected in most areas of art, including writing, painting, photography and even in the world of high fashion and couture. So you might well be feeling colourful and summery now, but having had a peek at the winter fashion collections in Vogue, I can honestly say that doom rules. Severe cocktail dresses, tailored suits, sharp conservative attire, all in varying shades of black (with a teensy bit of white ruffles.) It’s like the catwalks have been taken over by the cast of Ally McBeal. Everyone looks like lawyers or accountants.

sc_workshop 884

Rowena acting all prim and proper for the Winter Collections

Art reflects not just current styles, but also how we feel and what is going on in society. Leatrice Eiseman of the Pantone Color Institute has noticed that when folks become more concerned about the state of the world, they become more conservative in their tastes. She thinks that wearing sharp and stylish black clothing makes people feel more in control, more empowered. This makes sense. As a colour, wearing black shows you are taking life (and your planet) seriously. Black is sober, practical and makes the wearer feel more intellectual. It shows society that you are sensitive to the problems in the world and that you dress accordingly.

The old adage is that if you want to know the imminent economic fate of the world, then look at fashion. Like other artists, fashion designers are the ultimate psychics. It has always been thus. Coco Chanel designed the iconic little black dress just before the 1929 economic crash, the drab punk look evolved just before the 1970’s oil crisis, and the Goth movement (ah, fond memories!) developed just before the 1980’s UK recession and property market crash.

sc_workshop 901

Genuine bona fide Goth model from the Scott Church workshop. No idea who she is, but we call her Elvira

When times get tough, people want clothes which are austere. They want dark colours and classically cut clothes that are going to last several seasons because they won’t have much dosh to throw at their wardrobe. I could be wrong, but I also think this could be a moral reaction to the last ten years of spend, spend, spend. The winter fashion this year may well precede a full-blown consumer backlash due to the proles’ growing revulsion against excess, waste, consumerism and cheap 'n' tacky Chinese imports.

Fashion design, an art-form in itself, is getting sombre on us all. It is a psychological mirror for the masses. Expect both your art and your wardrobe to be very dark indeed this Christmas.

L-von-B 72

Hip fashion goddess, misery guts, and doom merchant to the nude blogging world

Looking on the bright side: For a boring old accountant like myself, after a lifetime of having the fashion sense and style of a hairy warthog, for the first and only time in my life this winter, I can at last realise my dreams and be a trendy fashion icon!

Hurrah! Bean counters rule the world!

Standing At the Helm

Sorry about yesterday’s wallow in doom. I don’t know what came over me.

Sheesh.

It's unlike me to be so maudlin.
(To those of you who missed it, count your lucky stars.)

The economy forms a large proportion of my day-job, and I guess being constantly soaked in negativity can really kick the crap out of me sometimes. Yes the world economy is in a nose-dive. Things are going to get really, really bad. Even more reason then for me to concentrate on making this blog an oasis of escapism and positivity (for our own sanity as much as for you folks.)

An accountant’s job is to stand at the helm of the ship, and steer her business (and blog) through the choppy seas, and bring them both safely out the other side. Yesterday I guess I temporarily fell overboard.

In future I promise to try to refrain from talking out of my ass, and concentrate on having a bit of fun.

This model really needs to diet or that cat-suit’s gonna blow

Why the fate of the world rests with Ohio

So it’s Hillary for president then.

At least that’s my outside bet. But hey, what do I know?

Well, I’m an accountant, so my reasoning is mainly financial. (Yes money is boring, but I’m boring, so live with it.)

The US is in recession.
Yes, it is.
I’m sorry for all you die-hard optimists, but please let's all just get real for a moment.

The U.S. lost 63,000 non-farm jobs in February, the biggest drop since the start on the Iraq war, and overall, the private sector shed 101,000 private sector jobs in January alone. And there’s no end in sight either. Inflation and the general economy are worsening. When people are broke, they can’t pay their mortgages, which means more pain for banks, who in turn are more reluctant to lend money and when they do, it will be at a higher rate, which in turn means less dollars all round. And as the US stops spending, so the poor starving Chinese citizen will end up losing his job too, as US imports will also decline dramatically over the next year.

The eminent economists Ethan Harris and Jody Clarke predict things will get gradually worse, both inflation and unemployment will continue to rise, despite the Fed continually cutting rates, and the end result will be negative growth by the end of May.

Forget about the war, after all, no-one’s talking much about Iraq any more. All talk is of money and how it affects the average US citizen. In particular, please spare a thought for all those blue collar workers in the depressed US manufacturing heartland (N.Y. Pennsylvania, Ohio and in-between), who are feeling extreme pain in their wallets. Life for them is unrelentingly grim at the moment. Their jobs are being increasingly outsourced to India and Taiwan, and many of them are starting to blame the North American Free Trade Agreement (NAFTA) for their misery.

Enter into this gloomy scene the immaculately coiffured, blond haired witch, who will make it all disappear with a zap of her magic wand…hurrah for Hillary! She’ll swoosh in on her broomstick to save the day.

Barack lacks economic experience and he's dodged the NAFTA issue completely, but our future Madam Prez Hillary, saviour of the morally upstanding white proletariat worker, has pledged to renegotiate the same treaty that was once championed by her husband. The result? Ohio and the other swing states (once Bush devotees) are now so desperate for change, for hope, they will fall under her evil spell. Muggles beware!

Not convinced? Need another reason?
Well, it is popular knowledge amongst political analysts over here that however Ohio votes, the world follows.

Of course I could be wrong about US politics, and let’s hope I am. But if The Grand Sorceress is indeed ruling the world this time next year, then you can be sure I’ll be blaming everyone in Ohio…



Me, wearing clothes for a change.

A Perfect Storm

At the high risk of annoying my beloved Don, I must regretably report that Morgan Stanley is the first bank to issue a full blown recession alert for the US, warning of a "perfect storm" for consumers as the housing crisis spreads.

In a report "Recession Coming" released yesterday, the bank said the credit crunch had started to inflict some serious damage on US companies, resulting in a sharp slowdown in business investment. It predicts that the Fed's interest rate cuts are too little, too late, and that a recession is inevitable.

The "R" word makes Don and I argue. Oh dear. I really do hope that his fluffy economic view of the future is right, for all our sakes, but for now I remain firmly Chicken Little. In the meantime ladies and gentlemen, place your bets.



I resolved not to blog about economics any more. Clearly I blew it.
Here's Lou-Lou, ready to beat us pessimistic economists into submission.