Cutting Back

When news about the economy is bad, individuals and businesses cut back; they cut jobs, budgets, forecasts, etc. These cutbacks in turn cause the economy to worsen, as we spend less and take on a defensive financial posture. The bad news and the cutbacks mutually reinforce each other, and can produce a long and painful recession, or a depression.

Are we in a depression? In my opinion, no, we're not, and we aren't headed for one either. The American economy is simply too robust, and today the government has a lot more power to get growth back on track than it did back in the 1930's. The main difference between now and then is that back then money was backed by gold -- the gold standard -- whereas today we have a fiat currency. Fiat currency means that the Fed and the Treasury Department can literally pump trillions of dollars into the economy, as they are doing now, without putting the real treasure -- American gold -- at risk. Soon, everything will be OK. All our government has to worry about is inflation down the road, which it will tackle by raising interest rates. Easy.

I'm still trying to figure out what the next bubble is going to look like. During the Clinton years, it was technology in general, with the Internet leading the charge. Earlier this decade, it was, of course, housing and easy credit. But how is America going to prosper after the Fed has raised rates? Can the green movement really generate serious wealth for you and your neighbor? Will American innovation be a big enough engine that can raise the standard of living for a large swath of American households? I'm still trying to figure it out, so I can prepare for it and ride that wave when it comes.

For now, my prediction is that this recession will last until at least the second quarter of 2010. Fed Boss Ben Bernanke, America's most powerful economist, recently said that he thinks a return to growth will happen by the end of the year. Here's a clip:

"...We continue to expect economic activity to bottom out, then to turn up later this year. Key elements of this forecast are our assessments that the housing market is beginning to stabilize and that the sharp inventory liquidation that has been in progress will slow over the next few quarters. Final demand should also be supported by fiscal and monetary stimulus. An important caveat is that our forecast assumes continuing gradual repair of the financial system; a relapse in financial conditions would be a significant drag on economic activity and could cause the incipient recovery to stall. I will provide a brief update on financial markets in a moment.

Even after a recovery gets under way, the rate of growth of real economic activity is likely to remain below its longer-run potential for a while, implying that the current slack in resource utilization will increase further. We expect that the recovery will only gradually gain momentum and that economic slack will diminish slowly. In particular, businesses are likely to be cautious about hiring, implying that the unemployment rate could remain high for a time, even after economic growth resumes..."

I think Bernanke's prediction is too optimistic. In my opinion, the housing problem needs more time to stabilize. I'm hoping Uncle Ben is right, and I'm wrong. But I understand where he's coming from. Bottom line: The best way to break the self-reinforcing, downward spiral is to dump as much cash as possible into the financial system, and inject as much optimism as possible into the collective American psyche.


No More TV

Since the peak of the credit crisis in October 2008, I've been cutting back in many ways, but yesterday I did something I never thought I'd ever do: I canceled my cable TV. I kept the High-Speed Internet service, but canceled all cable TV options. I'm no TV addict -- I never watch TV during the day -- but there are certain programs I enjoy when I need to take a break from work. Here's a list:

• Nightly Business Report
• Nature
• NOW
• Bill Moyers Journal
• Secrets of the Dead
• Frontline
• Masterpiece (they should run I, Claudius every year)
• Modern Marvels
• How It's Made
• On The Money
• Suze Orman
  
• Kudlow and Company
• for the occasional laugh: Family Guy, Robot Chicken, American Dad, (that alcoholic, drama queen alien cracks me up) and South Park.
  

Digital TV is just around the corner, and I'm hoping it will work in my area. Conventional TV never worked where I live. I think it's because the cable company is sabotaging it. When I had cable installed years ago and asked why I couldn't get any free TV through the airwaves, I was told that it was because I'm too close to the airport. Nonsense!

I won't miss Comcast. I don't like the way the company operates. They treat their customers like suckers: all those ridiculous fees! For example, why should I be forced to pay a monthly fee for a cable box? Should be a one-time fee. Moreover, the more channels you have, the more they charge you for each cable box! It's BS and I can't stand it.

It's all good, really. Fact: all the smartest and most accomplished people I know either don't own a TV or they have a TV set but only use it to watch rented movies. Yep.

I really need to play catch up with my reading list anyway.

Expanding My Culinary Repertoire

I've also been expanding my skills in the kitchen so that I don't get the urge to eat out as often as I do. I need to learn how to cook dishes that don't require a lot of preparation, cook fast and taste great. I'm middle-aged, so eating right is important. Besides, I have no tolerance for grilled cheese, Ramen noodles and the like.

An old boarding school friend helped me perfect what has become my most common meal: London Broil. This cut of meat is always reasonably priced at my local market, and, thankfully, it goes on sale quite often. There is no need to marinate this steak for hours as many pro chefs will tell you. I make an extremely tasty meal from this cut like this:

1. List of Ingredients: London Broil steak, Lea and Perrins Worcestershire Sauce, one yellow onion, olive oil.
   
   
2. Preheat your conventional oven to 375 degrees.
   
   
3. You want to caramelizing slices of a yellow onion in a pan with olive oil while the meat is cooking in your conventional oven. Begin by heating the olive oil on high heat, add the onion slices then turn the heat down to medium-low. Turn slices every 5 minutes or so until nicely browned. Meat will be done a few minutes after your onions are ready.
   
   
4. While the onions are caramelizing, place the steak on a glass Pyrex® baking dish. (FYI: all Pyrex bakeware is manufactured in the USA!)
   
   
5. Poke holes on one side of the meat with a standard fork. The more holes, the better.
   
   
6. Shake up a bottle of Lea and Perrins Worcestershire Sauce and flood the perforated meat with plenty of sauce. Don't be stingy. Important: Don't use any other brand of Worcestershire sauce.
   
   
7. Flip the meat over and repeat steps 5 and 6.
   
   
8. Place meat in oven, middle rack, and cook each side for 12 minutes.
   
   
9. Remove meat from the oven and cut into the center. You should have a thin, brown outer layer and plenty of pink in the middle. This meat is best when it's medium-rare. If you don't like all that rawness in the middle you can stick in back in the oven for a few more minutes, but be warned: if the meat is brown right through to the center, it will be tough and won't taste as good.
   
   
10. Add your carmelized onions to the pyrex dish with the meat and let the meat stand for 3-5 minutes. Makes sure the onions are submerged in plenty of drippings. Also, use a spoon to spread plenty of drippings on top of the meat to keep it moist. And you're done!
    

You can save even more time by forgoing the onions. Meat will still taste great.

While the meat is cooking, the smell of the cooking meat will probably make your mouth water. I always snack on a raw carrot while cooking.

I get plenty of carbs from my other meals during the day so when I cook this dish I have it with a side of salad and a couple of raw carrots. This roughage is very important if you want your gut to last a good long time (i.e. avoid colon cancer.) I also eat plenty of fruit during the day to keep my pipes happy.

One bite of this and all my cravings for a savory restaurant meal quickly melt away.

I don't worry about cholesterol since a) it's never been a problem for me, b) no problems with it in my family history and c) I believe in the Blood Type Diet.

The above is a great meal for a bachelor. When my daughter visits, we usually enjoy pasta with low fat meat sauce (I brown the meat, dump it in a colander then run it under hot then cold water to get rid of the fat) with a salad on the side.

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