Wednesday, July 30, 2008
I DVR'd Sunday's premier and watched it last night and while I can't say I enjoyed it as much as many of last season's episodes I think, after much thought, that this is the direction the show is going. The entire show portrays a world in the midst of change. I mention the two songs above due to their change theme but they are also appropriate to the show in that they're more or less contemporary to the period the show is set. It's February of 1962. About fifteen months have passed since Kennedy's election and the end of season one. Chubby Checker's "Let's Twist Again" is playing as we are reintroduced to the characters going about their day. The opening recalled the first episode of "The Sopranos" second season - or was it the third season? - when we catch up with the characters with Sinatra's "It Was a Very Good Year", and it reminded me immediately that Matthew Weiner, "Mad Men"'s creator, is a "Sopranos" alum - he was a writer and producer over there. The change theme is hit on immediately: new technology has invaded the Sterling-Cooper offices in the form of a Xerox machine; Paul Kinsey now sports a beatnik beard; Peggy, in her new position of copywriter, now sits in with the men in meetings instead of waiting on them.
But, as I mentioned, the biggest changes are occurring for Don Draper. Last season's supremely confident Draper first appears this year (spoilers ahead) in a doctor's office, where he's told he has high blood pressure and is prescribed phenobarbital. Later, he is unable to perform sexually with his wife Betty. He sits in a bar and sees a young bohemian reading Frank O'Hara's poetry. Last season the show took shots at the bohemians; when one of them contemptuously asked Draper, "How do you sleep at night?" without missing a beat he answered "On a bed made of money." This season he goes out and buys the O'Hara book. At work he is pressured by Roger Sterling to higher younger copywriters, a move he disagrees with. At home, his sexually frustrated wife Betty is flattered when a younger man shows interest in her at her riding lesson. She runs into an old roommate who she discovers is now a prostitute, and she is intrigued. When her car breaks down, she brazenly flirts with the mechanic when she realizes she doesn't have enough money to pay him to fix her car. Now, we'd been aware of Betty's sexual fantasies in season one; she imagined having sex with a door-to-door salesman, and she actually had sex, or foreplay at least, with a balky washing machine (don't ask, go rent season one's DVDs). But her actions this season show a woman on the brink, a woman longing for sexual attention. Trouble is brewing.
Besides the actual events, the change theme seemed palpable in other ways. The entire episode seemed a little off-key. The scenes set in the Sterling-Cooper ad agency were somewhat muted, the scenes in Don's home were downright dark, and the entire atmosphere seemed a bit claustrophobic. Much of this was probably deliberate; if you're going to portray a man's downfall it's better done in the subdued atmosphere of the other night's show than with the bright colored confidence of last season. Sunday night's episode lacked the smart sheen, the confidence and glamour, of last season. And Don Draper seemed hesitant, shaken. In the show's final sequence we get a hint about why. We see Don reading the O'Hara book and then slipping it into an envelope with a note - "Made me think of you - D". He mails it that night while walking the dog. Now there are two possibilities here: Draper mailed the book to Midge, his Greenwich Village lover from last season, who seems the obvious choice given her bohemian lifestyle; or he sent it to Rachel Menken, the rich Jewish department store owner. My guess is that he sent it to Rachel. She was the one who moved him; the one who broke through his defenses, the one he opened up to. She broke off with him when he wanted her to drop everything and run away with him, and we found out later she'd left on a three-month world tour in order to get away from him. Now, Don is in despair. At least that's my guess. We'll find out soon I'm sure.
The change theme is reflected even in this final sequence. The show that started with "Let's Twist Again" ends with Don reciting one of O'Hara's poems. That's a pretty jarring juxtaposition and I'm sure it was deliberate.
Sunday, July 27, 2008
"Mad Men" isn't satire. You don't get the feeling that the show, in its willingness to relegate black characters to elevator operators and lunch cart attendants, is attempting to self-consciously ridicule this historic truth but merely to represent it accurately. When the men call the secretaries "girls" and the women respond, the moments aren't played for irony. Instead it's meant to be a glimpse of life through a time machine.
The show's depiction of this sort of prejudice isn't unique. But the tone is striking. Typically, popular culture depicts racists and sexists as evil characters in need of redemption: red-faced men with hick accents, pinch-faced women with cruel mouths, or sleazy lotharios who exude the hygiene of a petri dish. These men are handsome and charming.
Just so. We, in our supposed enlightened age, have the nagging tendency to judge other eras by the standards of our own. We think we're the be-all-and-end-all, that we've arrived at some universal truths that other eras were blind to. Nonsense. Fifty years from now people will look back on our own age and chuckle, or be outraged, that we behaved and believed as we do - perhaps not about race, or sex, but they'll find something. I myself am fairly certain future generations will look back on us as a silly and frivolous people, who allowed their national identity to be diluted, and their standing in the world to be diminished, due to their acceptance of the doctrines of political correctness. But that's a story for another day. The makers of "Mad Men" reject the kind of thinking that says we must judge previous eras through the prism of modern opinion. Ms. Givhan understands this but it still seems to stick in her craw.
Look, I have no problem if "Mad Men" decides to take up the subject of race, to add, as Ms. Givhan suggests, a black secretary or a black man as one of the advertising men. We're dealing with the 1960's here, not the 1860's - it's not like these things were unheard of at the time. The statistics show that blacks made tremendous strides within middle-class America in the 1950's. Even in the pre-civil rights era and without the government's help, many if not most Americans had already come to the conclusion that the treatment of blacks in America was an outrage and must be changed; that blacks were as American as the rest of us (more so than most if judged by the time their ancestors arrived in this country) and deserved an equal place at the table. For "Mad Men" to acknowledge this reality with a black character would be historically accurate and would not go against the grain of the show; after all, they acknowledged the advancement of women in the workplace with the promotion of Peggy, Don Draper's secretary, to junior copywriter in season one's final episode. But, like the promotion of Peggy, the advancement of blacks in this white man's world would need to be done in the context of the show and in the same spirit the rest of the show operates. Otherwise it would fail. If it does becomes satire, or irony, or (even worse) a morality play, I'm done. I've seen it before and I've had enough of it. The day "Mad Men" starts asking forgiveness for its era's perceived sins is the day I stop watching.
As for you, watch it tonight. If season two can live up to the entertainment standards set in season one, you're in for a refreshing treat.
Friday, July 25, 2008
- I've just finished Victor Davis Hanson's excellent column on Obama's speech yesterday, in which he points out that it was not "the world" that saved Berlin during the airlift, nor did "the world" save the Muslims in the Balkans. It was, rather, the United States of America. For the historically and/or morally confused, it's a must read.
- Appalling. That's how Derb describes both presidential candidates this year and it is hard to disagree with him. You know my views on Obama but I've said little about McCain. I tried to address McCain and his campaign last week but I just didn't have the energy, or the interest. Suffice to say that the main point of the aborted post was that McCain, rather than being any sort of 'maverick', perfectly reflects the current Republican party - a tired old man at the head of a tired old party. He has big openings - drilling, nuclear energy, secure borders, judges who follow the law and the constitution rather than make their own laws, lower business and capital gains taxes to get the economy going, foreign policy expertise - but he's only paying lips service to any of these issues. I understand the mainstream media's strategy is to ignore him as they fall humbly at the feet of the Obamassiah but there are ways to get your message across if you want. I think he'd be a disaster as president and the only reason to vote for him would be that he'd be only slightly less disastrous than Saint Barack.
- Regular readers of this blog may think I'm too hard on politicians. Yes, I do subscribe to Mark Twain's famous remark that "there is no distinctly native American criminal class except Congress." On previous occasions in this space I've called them cowards, boobs, and idiots. You may disagree but before you take me to task please open up the Wall Street Journal editorial page this morning and read its top two editorials: Housing Bill Hammers Taxpayers and Democrats Against Drilling. Done? I rest my case.
Judging from the local drive time radio shows, we bitter, religious pistol-packers here in flyover country remembered only two things from Obama's Berlin visit: the phrase "citizen of the world" and Obama's failure to visit wounded troops at Landstuhl and Ramstein.
This morning the radio fairly crackled with callers incensed at what they perceive as Obama's snub of American warriors while ingratiating himself with people who refuse to send any combat troops to Afghanistan. This was not conservative radio but your typical morning traffic and weather blowtorch. And it was in the bluest part of the state (although callers come from much of northern Ohio).
Last evening on a different station, people were put off by Obama proclaiming himself to be a citizen of the world when — according to several callers — he regularly gives indications he's not particularly enthused about being a citizen of the United States. The litany was recited: Obama's making a show of not wearing the American flag lapel pin; his wife's claim that America is a "downright mean" country; Obama's association with Bill Ayers, photographed stomping on the American flag; Rev. Wright damning America; Obama's embarrassment that Americans can't speak German and French; his wife's being proud of America for the first time only because of her husband's candidacy; his condescension toward the purportedly bitter folks clinging to religion; Obama's delegation to the U.N. of the right to tell Americans how much we can eat and how far we can drive, etc — all the greatest hits.
Scott Johnson over at Powerline alerts us to Rush Limbaugh's comments regarding Obama's criticisms of the United States in front of a foreign audience (something Bill Clinton also makes a habit of; apparently these two megalomaniacs can't resist applause lines no matter who the audience and they know the best way to get it in front of a European crowd is to criticize the United States). Read the whole thing but here are Rush's comments, which I agree with completely:
So now he has to go apologize for the United States of America. What is it? He's black, he's running for President of the United States, "We haven't perfected ourselves." You know, that's a key phrase, by the way, is one of the things that drives liberalism is the fact that they think people and institutions can be perfected. They think they can be perfect. And when nothing is perfect, then everything's wrong. But this is just beyond the pale. He's talking to Germans and making excuses for the United States of America, which to this day defends and protects Germany? (interruption) Exactly right. This is insulting. It is demeaning. "We have made our share of mistakes. There are times when our actions around the world have not lived up to our best intentions." This is Iraq. But he's not a candidate, folks. He's just a guy strolling through the forest there who happened to see a microphone and a podium.
He says, "Oh, there's about 100,000 people out there. I think I'll go make a speech." This is change. But ladies and gentlemen, if you are wondering when you hear Obama talk about change, this is it. The change is: America sucks, America's deficient, America's guilty, but America is now willing to pay the price because we have a Messiah who understands the faults, the egregious errors made by the United States and her people. We are racists, sexists, bigots, homophobes. We discriminate against people who worship differently than we do, have skin color different from ours, and we have not always behaved properly in the world. And we torture. And we, of course, are biased against people who want to get into our country illegally. We have a lot to pay for. Not to mention that we are primarily the country responsible for climate change, shrinking the Atlantic coastline, melting the Arctic ice. This is the change. You want change? This is the change.
"Citizen of the world,", criticizing America on foreign soil, and snubbing American soldiers is probably not the message the Obama campaign wanted this trip to convey. But it seems to be what people are focusing on these past few days.
Mad Men is set in the world of Madison Avenue advertising circa 1960. Season one ends with the election of JFK and the Thanksgiving that followed so I expect season two will pick up from there. While they aren't explicit about it, one of the aims of the makers of Mad Men is to contrast that world with our own PC-drenched, so-called enlightened era. The attitudes then in place - towards women, marriage, divorce, drinking, smoking, psychiatry, and more - are presented here with little editorializing; things are simply portrayed as they were without comment or judgement. When one of the advertising executives calls a secretary "honey" or "sweetheart", or comments on the way she walks, there are no pauses in the action. The camera doesn't stop to show the woman's reaction. We only notice the moment because it contrasts so sharply with our current attitudes. The same is true when Roger Sterling, one of the firms partners, gets into his car to drive home blind drunk. Don Draper, the advertising whiz who is the show's main focus, doesn't try to stop Sterling, or take his keys, or call him a cab; he simply closes his front door. During another episode, one of the other ad men buys a rifle and playfully aims it at people in the office. In virtually every episode, the men sit in meetings, each with a drink and cigarette in hand. Draper keeps cleaned and pressed shirts in the bottom drawer of his desk so he can change into a fresh one before going home to his wife; he doesn't want her to smell the scent of his lover. Inter-office affairs are conducted, sometime in the office behind closed doors. Never does the show stop to announce, "See how bad things were back then? See how much we've progressed?" Nor does it take the other side, claiming things were better in the old days. Mad Men simply portrays the world as it was, a world in which women married young, had babies, raised a family, and had dinner waiting in the evening when their husbands arrived home; if they were ambitious they became secretaries. Men worked, smoked, drank, and had affairs.
And boy did they smoke. The screens becomes almost claustrophobic with cigarette smoke at times. Everyone smoked back in those days, or nearly everyone. My buddy who first told me about the show was from a military background and apparently his parents were non-smokers. He told me he found the amount of cigarette smoking done on the show to be off-putting - it was simply too much. It doesn't bother me because I come from a world in which everyone smoked. I grew up in that world. My mother didn't smoke but she was the only one - I remember my mother's uncle (Uncle Fred, long gone now, and one of my favorite people) once telling me that she was the only person in the entire extended family who didn't smoke. Same on my father's side. We all smoked. So the world of Mad Men does not seem far-fetched or exaggerated to me in that aspect whatsoever. Smoking was cool; it was glamorous. Take the cigarettes out of Mad Men and it loses that glamour.
Mad Men is much more than an anthropology lesson though - I hope I haven't given that impression. The acting is marvelous, the story lines are quirky and surprising, and it has lots of excellent characters. Don Draper is clearly the most interesting; the man with a past he's trying to escape. I think of The Great Gatsby when I think of Draper - the American story of escaping the world you were born into, remaking yourself into what you want to be, limited only by your own ability and imagination. And Draper is a man of immense ability and large imagination. As portrayed by Jon Hamm, he's a riveting presence on the screen, the kind of man other men want to be like, and women want to be with. I'm looking forward to season two of this excellent series with great anticipation.
Sunday, July 20, 2008
Dial M doesn't measure up to the best of Hitch but it will do. I was intrigued by (spoiler alert!) the plot the Ray Milland character devises to kill his unfaithful wife, Grace Kelly, and even more intrigued by how, after she kills the intruder who is supposed to kill her, he sets her up to make it seem like premeditated murder. And, of course, the Milland character almost get away with it. You know all along he won't, just as you know Grace Kelly won't end up in the gas chamber. What you don't know is what will trip him up in the end. It's fun - not hugely entertaining like the best of Hitchcock, but well worth staying up late for.
The question that kept nagging me the whole way through was this: why would Grace Kelly cheat on Ray Milland with so bland a fellow as Robert Cummings? Milland was suave, debonair, witty, charming. A bit of a cad perhaps, but a lot of woman like cads, just as, as a moviegoer, a lot of us like woman who like cads. Anyhow, Robert Cummings is such a zero that it is hard to believe she'd find something appealing about this guy. We lose respect for her. The movie would have worked much better if Cummings were the cuckolded husband and Milland were the lover. We could understand Grace Kelly making a mistake of marriage to a nonentity, and as a result we could much better understand an affair with the sophisticated Milland. Furthermore, the smallness, the nothingness, of Cummings would have made his getting caught in the end much more satisfying; we would feel he got what was coming to him and the two people who belonged together - the ravishingly beautiful Grace Kelly and the charmer Milland - were now free to do so. Instead, we're almost sorry Milland doesn't get away with it.
Grace Kelly is beautiful here but the script doesn't allow her to show off her full sensuality. She is dressed in a lovely nightgown during the murder scene and immediately afterwards; we're aware of her beauty. But the character she plays and the plot direction don't allow for anything more than this. We don't get the playful flirtations from her as in To Catch a Thief, nor the more overtly sexual longings of an adult woman as in Rear Window. This is another reason why the movie could have been better with the male roles switched. As it is, Grace Kelly is an adulteress but one without guilt or shame. If the male roles had been switched and she were shown enjoying her sensuality during a tryst with Milland, she'd be more of a fallen woman, and more interesting. As it always is in the movies, the bad girls are much more interesting than the good ones. Grace Kelly is too good here.
Saturday, July 19, 2008
Friday, July 18, 2008
I swing back and forth on Obama's chances for the presidency. Some days it appears inevitable. Other days he seems to have insurmountable obstacles. I will say this: if Obama is to lose, Krauthammer - who to my mind is the finest political columnist now working in America - will be one of the first people we should thank. Nightly on Brit Hume's Special Report panel and week in and week out in his column, he has become a one-man wrecking crew aimed at Obama and his presidential aspirations.
Of course, if I'm wrong I'll get burned. Say the price of ABC stock goes up to $110 per share. I must still cover and return the shares to my broker. In this case I've lost $1000 ($10,000 I received when I borrowed and sold vs. the $11,000 I had to pay to cover, i.e. repurchase the shares to return to my broker.)
The SEC moved to limit naked shorting against the financial sector the other day. Naked shorting is the practice of selling shares without borrowing them first. I don't really have a problem with this, though I don't know enough about it to be sure. In what is probably a first for this blog, I'll state that on this issue I may change my mind once I've learned more about the practice.
But my real concern in this post is normal shorting, and with this I have no problem whatsoever and neither should anyone else. Shorters get a bad rap but they perform an important function in money and commodity markets. As Jerry Bowyer pointed out the other day on Kudlow's show, short sellers are (I paraphrase) the market disciplinarians, the ones who say, "no, I don't believe this story." They are the market pessimists, often the market realists, and they keep stocks and commodity prices from exploding irrationally to the upside. They have been blamed for the crash of the financial stocks but they've been correct in their analysis - the balance sheets of many financial companies, even in good times, are baroque works of fiction that are not understood even by company insiders. So complex are the assets these firms hold that putting a value on them is akin to throwing a dart blindfolded. It is natural for executives to be, shall we say, optimistic when assigning those values. When the subprime crisis arrived last fall, the shorts were the ones who understood this first. They made money of the trade because they were right. More power to them.
Anyhow, the Wall Street Journal has a nice column this morning on the recent SEC decision. It's well worth reading in full. The point is, people who speculate on oil are not evil, nor are people who short the market. They both perform important functions. Blaming all our current woes on them is an prerogative only for politicians and other ignorant people.
George Bush on occasion gets something right and on this issue he can take a well-deserved bow - a partial one anyway. The three day sell off in oil came immediately after he lifted the executive order banning off-shore drilling. The move clearly had a psychological effect on the market as traders came to the conclusion that public opinion on drilling has finally reached the political class and perhaps future sources of supply are on the horizon. Add to this the news of shrinking demand here in the U.S. along with evidence of a global slowdown and it all adds up to a quick correction in oil prices. As I've argued from the beginning, supply and demand forces seem to be in control, not speculators.
T. Boone Pickens, America's leading oilman, agrees. From a recent Reuters article:
Pickens downplayed the role that speculative trading and institutional investors -- forces some see behind the high oil prices -- have had in the price trend. Asked about the role of institutional investors, Pickens told reporters he does not "agree that that has anything to do with oil prices ... It's a global market. It doesn't have anything to do with traders on Wall Street or any place else."
Jim Rogers, one of the world's most famous and successful commodity traders, said this the other day:
"Some people blame speculation for oil price rise. If it is speculation, when the oil price is too high, the people with oil will drown the speculators. It is just a stupid accusation that speculators are behind the oil rally,"
Ben Bernanke, Fed Chief, said this to the geniuses on Capital Hill during his congressional testimony the other day:
Another concern that has been raised is that financial speculation has added markedly to upward pressures on oil prices. Certainly, investor interest in oil and other commodities has increased substantially of late. However, if financial speculation were pushing oil prices above the levels consistent with the fundamentals of supply and demand, we would expect inventories of crude oil and petroleum products to increase as supply rose and demand fell. But in fact, available data on oil inventories show notable declines over the past year. This is not to say that useful steps could not be taken to improve the transparency and functioning of futures markets, only that such steps are unlikely to substantially affect the prices of oil or other commodities in the longer term."
I hope people take note of what these experts have to say and ignore the demagoguery of Obama and the left. We need more oil, period. Better we produce as much as we can here and keep the profits in house, so to speak. Let's get moving.
Monday, July 14, 2008
Well, as with Boss Clinton, I just don't get it. I could never understand the fascination with Bill Clinton - I thought it was pretty clear from the start that he was a snake-oil salesman. But a lot of Americans obviously disagreed. Now, there is a fascination with Obama that is even more intense that the Clinton phenomenon; as I've mentioned before, it borders on the Führerprinzip. And again I'm in the dark. Even many people on the right say they can see the attraction of the man but I apparently am lacking in some vital inner sensibility; all I see is an arrogant gasbag, spewing gusts of hot air. Now, hot air is the norm for politicians, but what separates Obama from the usual crown is his vast abundance of it; he never talks about the substance of his policies, such that they are; he never gives a straight answer; he always talks in shades of gray; he almost always averts attention from what was actually asked to some talking point that has nothing to do with the real issue. And he expects us to fall for it (reasonably so, since so many people are falling for it.) Again, this is the man who claims he is a new type of politician, post-racial, post-partisan.
But how about the condescending arrogance of the man? Have you noticed how he likes to lecture us? When he made the Philadelphia speech in which he was supposed to explain his twenty year relationship with the racist Reverend Wright, he turned it into an opportunity to lecture us about race. Later, he scolded us for driving SUVs, eating what we want, and keeping our homes at a comfortable temperature, apparently because the Europeans might frown upon these behaviors. Last week, he answered the question of whether newly-arrived immigrants should learn English thusly:
Instead of worrying about whether immigrants can learn English—they'll learn English—you need to make sure your child can speak Spanish. We should have every child speaking more than one language. It's embarrassing when Europeans come over here, they all speak English, they speak French, they speak German. And then we go over to Europe and all we can say is merci beaucoup.
My goodness, we've embarrassed Barack Obama in front of all his European friends again. Here is just one more example of the university lounge mentality of Obama. He'd fit right in with all the sophisticated professors having a good laugh at all us plebians.
I wrote the above portion of this post over the weekend but didn't have time to finish it. I rarely post during the week but decided to pick it up here tonight when I saw that they had a discussion about this very aspect of Obama's personality today over on The Corner. Peter Kirsanow's post mentions something I hadn't thought of: the lectures are being delivered by a man who's life experience is rather thin:
The bully pulpit can be a good thing, especially when the speaker addresses something universal (e.g. the need for fathers) or with which he has unique or considerable experience. Nonetheless, while most of us might listen to someone whose judgment is tempered by experience, even paternalistic lectures from wise men can grate after awhile. I often resented lectures from my father who fought in WWII, survived a German POW camp, was tortured by and escaped from the NKVD, labored for 20 years next to the blast furnaces of Cleveland, Ohio and started a small business; but at least he had something to say. Obama's lectures grate in no small part because there's little evidence that he's had any life experiences more grueling or tempering than, say, casting a vote in the senate.
Derb picked up on this a little later:"we have interns round the office with deeper life experience than Obama." How true! Obama loves to lecture but he has done little to earn the right. How many of us would dare scold others for not being able to speak a second language if we didn't speak one ourselves? The audacity indeed.
Saturday, July 12, 2008
The world is a poorer place today. Heaven is a little brighter. Rest easy my friend.
"I want you to think about this," Barack Obama said in Las Vegas last week. "The oil companies have already been given 68 million acres of federal land, both onshore and offshore, to drill. They're allowed to drill it, and yet they haven't touched it – 68 million acres that have the potential to nearly double America's total oil production."
The Wall Street Journal has offered Obama and other Democrats who spew this nonsense some remedial education. Read the whole thing so you're not mislead by politicians who want to keep you ignorant.
Sigh. I've got news for Senator Obama. Last I checked, there were more NYMEX oil contracts on the short side than the long side. In other words, more people were speculating that the price of oil would be going down rather than up. If Obama were to curb or end speculating under these circumstances, the short-term price of oil would almost certainly go up.
What about the long-term price? James Hamilton, over at the Econbrowser blog, wrote this excellent analysis of the effects of speculation in the real world back on May 22:
There are individuals who use this physical commodity-- namely, consumers who use the gasoline to drive their cars-- and separate entities that produce it-- most importantly today, the national oil companies of the oil-producing countries. The key question is, How would the behavior of these two parties change as a result of a new higher price for the basic commodity they are consuming or producing?
If your answer is, neither consumers nor producers change anything they do at all in response to the price increase, then I agree you could make a case that speculators by themselves could make that price any old number. But I don't believe it is accurate to assume that both consumers and producers would do exactly the same thing, no matter how high the price goes. At a higher price of gasoline, consumers will use less of the physical commodity. Not much less, I grant you, and that's why I agree that speculators are able to have more of an influence than I might have expected. But I would insist that if you drive the price of gasoline sufficiently high, consumers will respond.
And that's a problem for any "paper oil" theory-- if consumers are buying less of the physical commodity, what's happening on the production side? If production doesn't change, then oil must be piling up somewhere in inventory, possibly some just idling in tankers in the Persian Gulf. But no one has an incentive to keep adding more and more oil to inventory forever. So ultimately, the "paper oil" theory is going to require a reduction in the production of actual physical oil.
And that leads you to the question, Why would producers want to cut production? If the answer is, they make more profits with lower production and higher prices, then they would want to make those same production cutbacks with or without the speculation, and you'd have to blame the whole phenomenon on the operation of those profit calculations themselves, with the speculators just a device that got us to equilibrium between supply and demand more quickly.
Now, I personally do accept the view that the "paper oil" speculation has made a contribution in recent months to the increase in the price of physical oil. I believe that this speculation has resulted in a slight decrease in the quantity demanded that has required some modest supply reductions or accumulation of inventory by producers. But I expect that producers will find these changes not to be in their best interests as the demand adjustments become more prominent, at which point the price must return to that governed by the underlying physical fundamentals.
Ultimately, the price must be such that the quantity of physical oil demanded at that price is equal to the quantity of physical oil supplied. Any speculator who promises on paper to buy oil for more than the physical stuff is actually selling for will find themselves at that point with a big, fat paper loss.
Read the whole thing here. In a nutshell, Hamilton explains why the price of oil will always fall back to a price that is "governed by the underlying physical fundamentals." It's simple supply and demand. Once consumer behavior changes - i.e, when demand destruction sets in, as we've seen in recent months - producer's behavior will also change on the supply side; they'll produce less oil. If producing less oil for a higher price is more profitable for oil companies, than they would have been doing so all along, profit maximization being the ultimate goal of any money-making endeavor. So speculation may have short-term affects on price but in the end the economic fundamentals will rule; indeed, speculation may well end up bringing the market back into equilibrium sooner than otherwise. And speculators who ignore these facts will get burned.
Hamilton has another terrific post on speculation here, taking some other economists to task for some of their outrageous claims regarding the effects speculation has on the price of oil.
Obama is a demagogue; a slick one, but one nonetheless. He is playing off people's fears and ignorance, looking for bogeymen (i.e. oil executives) and pointing fingers. The energy fix we find ourselves in right now is, to be clear, a shortage of light sweet crude. Everyone knows where the solutions lie; more drilling, in ANWR and off-shore, more nuclear power, the exploitation the oil shale and oil sands territories, the use of more coal and natural gas. But none of these solutions can be found in Obama's so-called energy plan. Rather, he wants to redistribute $50 billion more in rebates and "crack down" on oil speculation. How do either of these "solutions" produce more oil?
Friday, July 4, 2008
I am, when it comes to modern culture, completely out of it. I never, and I mean never, listen to modern popular music. I don't even know the names of the bands or singers who are popular these days. If you asked me to name a single song that has been a top-40 hit over the past decade I couldn't do it, so separated I am from that culture. For me, it simply doesn't exist.
My distance from modern movies is not so complete. I still hear about most new-release movies, and read about some of them. On occasion, I am actually intrigued by one of them and desire to see it. But the vast majority of them pass me by with barely a notice. Which is fine; I've seen enough of the dreck that modern Hollywood produces to know that I'm not missing much.
When Little Children arrived, my wife, who handles the mail, was intrigued by the blurb on the Netflix sleeve. This is a major event in itself; rarely does she look forward to watching movies but she usually enjoys the good ones, and we quite often have short conversations afterwards about what worked and what didn't. I enjoy this a lot. We come at things from different perspectives and she'll often point things out that I've missed because we notice different things. A wise and perceptive woman I am married to, and I've learned over the years never to dismiss her take on something, even if it differs completely from mine. She's more often correct than not.
So we watched it. Or, to be more accurate, we watched about thirty minutes of it. By the time one of the characters started to whack off to porn in his office at work, we'd both had enough. Little Children is supposed to be some deep statement about the state of modern marriage and suburban life; but it is puerile, tendentious, and false. The little children here are supposed to be the adults portrayed in the movie but the term could also describe the folks who made this movie and who hold such views about a world they clearly know little about. Besides that, it is a badly made movie. After virtually every scene, a narrator's voice enters to tell us what is was we just saw, what the characters are thinking, and what we're supposed to think about it; in other words, the things most movies convey without the use of narration - part of the art of movie-making. It's as if they're scared we'll miss the point, but there is really no chance of that; each point is driven home with a hammer, then the narrator comes in to drive the nail in a little deeper. Which is not surprising; the filmmakers who have such obvious contempt for the regular people portrayed on the screen seem to have a similar contempt for the audience. They throw subtlety aside, assuming we're too stupid to get the point.
And what are the points? Suburban life kills the soul. Modern marriage is a lie. We'd all be happier if we acted on our secret desires. We're all hypocrites. Sigh. Aren't we all tired of this by now? The cynical, hipster, ultra-cool attitudes held by pop-culture mavens? In the fake world of Little Children, who are the sympathetic characters? Why, the bad mother who has affairs and the man she is having the affair with, a stay-at-home dad who has failed the bar exam multiple times. The stay-at-home moms don't fare so well. They are portrayed as lifeless, soulless, Stepford moms, who have no life beyond their children. The out-of-work policeman is portrayed as a slight lunatic, obsessed with making life hell for a recently released flasher who lives in the neighborhood. You're supposed to feel for the flasher. The wanker in his office, the husband of the woman having the affair, I'm not sure what we were supposed to think of him because we turned it off at that moment - it's really not something I've ever desired to see on film. Right before this we learn that there are others in the neighborhood who also have secrets obsessions - one likes to dress up as a woman behind closed doors, the other is a closet homosexual who has anonymous sex in seedy men's restrooms. You see? It's when we act on our shocking desires that we come closest to being real. Even the robotic women who take their children to the park each day, they too have these desires - they all lust after the guy who can't pass the bar - but they are too repressed to act on them. Suburban bigotry and intolerance are keeping us down, folks.
I for one have had enough of this type of 'art.' Now, I never intended this blog to be a constant rant and I will try in the near future to think of things to write about that are light and happy. Still, after watching a movie like this, it becomes all the more clear to me that I am out of step with the opinion-setters of the world. Call me old-fogy. I checked the reviews of Little Children on Rotten Tomatoes this morning and was not surprised that it was well-received. The people who write the reviews accept the attitudes of the pop-culture that emanates from Hollywood. I don't. I'll have to look backwards, as is my wont, to find art - movies, music, books - that speak to me. And that's not a problem; I've been doing it for years. I'm not dropping out. I'll still seek out the good in what's new. I'll endeavor not to become one of those tiresome bores who insists everything was wonderful back in his day and the world has gone to hell-in-a-hand-basket. I am an optimist, who looks forward to the future. But it will be a future without movies like Little Children.
Finally, to prove that I am not some prudish bore who is threatened when presented with uncomfortable material, I'll make a recommendation. If you are truly interested in stories that deal with adultery, the stifling aspects of marriage, the secret lives of others, read Chekhov's short story Lady With a Lapdog. It is brilliant. The protagonist Gurov also believes "that every man had his real, most interesting life under the cover of secrecy and under the cover of night." There is more understanding of human nature in a single paragraph here than in the whole of Little Children. Chekhov was a master of course, and an adult, unlike the makers of Little Children. He tells a real truth here; not the whole truth, or even close it, but a universal truth that all of us - the adults in the audience anyway - can understand.
Thursday, July 3, 2008
The column ends with this brilliant insight:
Socialism may have failed as an economic theory, but global warming alarmism, with its dire warnings about the consequences of industry and consumerism, is equally a rebuke to capitalism. Take just about any other discredited leftist nostrum of yore – population control, higher taxes, a vast new regulatory regime, global economic redistribution, an enhanced role for the United Nations – and global warming provides a justification.
Finally, there is a psychological explanation. Listen carefully to the global warming alarmists, and the main theme that emerges is that what the developed world needs is a large dose of penance. What's remarkable is the extent to which penance sells among a mostly secular audience. What is there to be penitent about?
As it turns out, a lot, at least if you're inclined to believe that our successes are undeserved and that prosperity is morally suspect. In this view, global warming is nature's great comeuppance, affirming as nothing else our guilty conscience for our worldly success.
In "The Varieties of Religious Experience," William James distinguishes between healthy, life-affirming religion and the monastically inclined, "morbid-minded" religion of the sick-souled. Global warming is sick-souled religion.
Of course, Al Gore is the unquestioned leader of this movement to drastically alter how we live, but others in high-places have drunk the kool-aid, including the execrable Harry Reid, whose comments this week can fairly be described as sick-souled:
Watch the video and get Captain Ed's comments on this nonsense here. We now have two nationally-elected Democrats coming out in favor of nationalizing the U.S. oil industry. We have the Senate majority leader claiming that "we’ve got to stop using fossil fuel." We have attempts from the Democratic Congress to sue OPEC and to curb speculation in crude markets. The same Congress is hauling oil executives up to Capital Hill to defend themselves and their industry, and calling for windfall profits taxes. We have Barack Obama and Nancy Pelosi insisting that "we can't drill our way out of this."
“Coal makes us sick. Oil makes us sick. It’s global warming. It’s ruining our country, it’s ruining our world. We’ve got to stop using fossil fuel.”
These are the people who will be the making the decisions come November.