Here is the crash in one picture — below the fold is the BDI chart — this is the index of all global shipping.

Here’s one picture that shows how the world’s economy has come almost DIW — dead in the water — a everyone stopped filling ships with goods.  Remarkable.

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collectors' item?

With its global perspective, the Financial Times opens the week cautioning that there are plenty of downside signs to counter the wavelets of optimism of the past few days.

FT notes a couple of dour signals:

• Global concerns about the failure of General Motors.  The White House has fired the CEO (well, forced him out) and given GM 60 days & Chryser a month to change personalities.  Global expectations: GM in its current form is toast.  Time to start imagining how the post-GM manufacturing landscape will evolve.
• European and Asian markets down.  It seems clear Europe is beginning to run behind the power curve in responding to the global meltdown. Germany and Spain each just took over a real estate banking firm. More European failures to come?

With President Obama meeting the G-20 in London this week, lots of attention on the global economy — probably good for us to remember that this is a world-wide crisis.

Our sole daily print newspaper, Seattle Times reports today that a number of our state’s banks are in trouble.

At least a dozen have serious problems: too many non-performing loans, too few assets, etc.  The article includes a chart showing the rapid rise failures nationally — banks closed by the FDIC — 20 already this year.

Here is a graphic from the Times showing which of our banks are in the most trouble. Bremerton’s WestSound Bank here in my district seems to lead the most-troubled list.

And here is the roster of all our banks and the various paramaters the regulators track to verify soundness.  The chart is interactive — you can click on a column and reorder the list.

This is one example why we must keep our newpapers going.  We need this kind of analytic journalism.

Not to be missed — repeat as often as you like.

Paul’s song

The International Monetary Fund staff published this note.  Dozens of excellent charts accompany a survey of the changes afoot in the global economy.

Among the many interesting trends one jumps out: global energy prices — which had zoomed in 2008 to seven times (!) their 2002 level — are still three times that baseline and climbing!

The message I take away: we better keep pressing ahead vigorously on energy efficiency and alternative energy sources.  Energy costs will help trap us in this recession, we better keep battering at that barrier, never mind that $2something gas seems cheap.

winter sunrise? false dawn?

Sprigs of Recovery came with the first days of spring — Dow above 7,000 etc.  The Chinese news agency  Xinhua reported the signs from a Moody’s conference in New York.  But notice what we’re supposed to be opptimistic about:

• home sales bottoming out mid-2009,
• house prices bottoming out in late 2009,

BUT that good news only leads to

• a sustainable recovery starting in the fourth quarter of 2010.

And this reminder: “conditions are expected to worsen before we see signs of recovery.”

In sum, we’re still on the same path — bottoming out late this year followed by a long, very slow recover.

What are you seeing?  Signs of recovery?  Or signs of continuing, somewhat mysterious crash?

The President is backing Geithner’s plan to attack the toxic asset wrench which is jamming our finance system’s gears.  Here is the Wall Street Jounal’s report.

Paul Krugman,  New York Times columnist and influential Princeton economist disagrees in his column today.  Calling this nothing but recycled Bush-Paulson, he ends expressing dispair if we head down the Obama-Geithner path.  Among his concerns:

• By what will soon be seen as a bad move, Obama will lose the political upper hand just when he needs the clout to persuade a flighty Congress to authorize yet another stimulus package, and
• As this certain-to-fail gambit plays out, the economy will continue to crash, shedding jobs on the way down.

Ahead: millions of words on TV and in print on all sides.  Whatever else may be shrinking, our national capacity for speaking out is undamaged.

And if you’d like to inspect the plan itself, here is the 5-page Treasury white paper explaining the program.  Worth skimming — that is your money in the “$500 Billion to $1 Trillion” in the title.

Your view?  Which way would you go?

one of the most astute

Some wisps of hope showed around the edges of the last week’s news: forecasts of growth in 2010 — anemic but growth — both in the national and Washington State forecasts.

But if as most agree there is no recovery until the banking/financial system deadlock is solved, we’re still way deep in a continuing crash.

Two notes:  If you have the 34 minutes, please watch this recent interview by Charlie Rose. Charlie has 3 expert analysts, including 2 of our major journalists, and former AIG CEO (apparently the one who didn’t cause the problems), Hank Greenberg.  I came away freshly sobered by the probabilities that we’re going to screw this up.

And Paul Krugman is saying out loud that we are screwing this up.  His blog series here.  Scroll down a couple of entries to “More on the bank plan.”

fear & anger aplenty

History has plenty of examples of radicalism arising in societies under stress.  A number of countries are showing signs: China, for example, where millions of workers are headed back to rural poverty as the estimable James Fallows reports from Beijing in The Atlantic.  Fallows notes that so far that the public outrage is directed toward corrupt local officials, not the governing regime which he expects to survive, even strengthen.

How about us here in America?  In The New Republic Walter Shapiro reviews the populist-extremist demagoguery of Huey Long (left) and Father Coughlin (right) during the Depression.  Shapiro finds reason to worry that we could see rage crowd into the political arena pushing aside the thoughtful politics we most need right now. One quote:

“What you’re seeing in the public right now is not anger but terror. They don’t know who to believe. They just know it’s bad.” [A pollster] adds, “The political system is still learning how to respond to an electorate that is terrified.”

WASHINGTON BUDGET How about here in WA?  We’re going to find out next week when we publish the first “all cuts” budgets.  I’m working to facilitate some serious dialog about priorities and strategies.  There will be lots to be unhappy about.  Will that turn to anger and paralysis or to creative reflection?  How can we help open the path to collective problem solving?

Here’s the link to the 60 Minutes interview with Fed Chairman Ben Bernanke.  A good review of the evolution of this crisis.  And some interesting Bernanke estimates:

• Collapse should flatten out this year,
• Recovery begin slowly next year,
• We’re close to a 2nd Depression,
• Key to recovery is restarting the financial system,
• Now in a 2nd phase of the crisis — the weak economy — first phase was the sub-prime problem,
• Fed will not led any big banks fail — but will ‘wind down’ bad situations like AIG,
• Biggest risk now is lack of political will to stay the course to recovery,
• need tougher laws to enable winding down bad banks better,
• Progress: mortgage rates coming down,
• Green shoots of recovery: when a large bank starts bringing in private capital,
• No recovery until financial system, banks, stabilized.