The Rude Awakening’s Joel Bowman has found himself in Istanbul, Turkey…a long way from Laguna Beach. While the whole country is experiencing an extreme drought, Joel reports that in Turkey’s capital of Ankara, the situation is very serious: they only have enough water left in their reserves for 78 more days.
“Some will undoubtedly fob this off as just another foreign crisis, a catastrophe restricted to the plight of second- or third-world countries and far off deserts,” writes Joel in today’s guest essay.
“This is simply not the case. Rainfall does not discriminate on grounds of a region’s economic prosperity. It takes account of no race, GDP or, despite enthusiastic prayers from millions of people here in Turkey, of religion. But rainfall is only one part of the problem. What to do with the water once it has descended from the heavens is at least equally important. Gross mismanagement (as has been seen here in Turkey) and insufficient infrastructure is also to blame.”
Joel BowmanAugust 30, 2007
Keep reading today’s guest essay here:
Praying for Rain
And now, over to Short Fuse with some views from Los Angeles…
Views from the Fuse:
*** While the Middle East is getting little to no rain, the U.S. Midwest has gotten more than enough in the past couple of weeks…
Powerful storms rolling through the upper Midwest have left 25 dead, destroyed countless homes and have hundreds of thousands without power. This week the cleanup begins, although parts of Wisconsin are still getting hammered by heavy winds and rains.
As with any major disaster, after the cleanup, comes the rebuild, the cost of which will be astronomical.
“Almost two years after Hurricane Katrina battered the Gulf Coast, the government, private enterprise and charities continue to pour billions into cleanup efforts,” Bulletin Board Elite’s Greg “Gunner” Guenthner tells us. “As of last summer, the federal government alone shelled out $3.6 billion to cart off nearly 100 million cubic yards of debris from the area. And cleanup efforts continue to this very day.
“Of course, there is even more work to be done after the debris is swept under the rug. Hazardous and toxic wastes from mining operations, industry and the like are routinely leaked onto agricultural land, city streets and residential neighborhoods during flooding. In fact, this type of cleanup is almost always necessary whenever flooding occurs.”
Gunner tells us that disaster cleanup is big business – and one miniscule company has the wherewithal to tackle any difficult cleanup. Its subsidiaries employ the scientists and technicians that can handle everything from mold to asbestos and hazardous waste removal.
*** Here’s a story to make your stomach turn…with people less likely to use credit to buy cars or homes right now, the lending giants have found another “big ticket” item to cash in on: your health.Credit card companies, led by Capital One (NYSE:COF), Citigroup (NYSE:C) and the CareCredit unit of General Electric (NYSE:GE), are offering zero-percent financin2g to those who qualify for not only procedures not typically covered by insurance, but for regular procedures.
The New York Times reports:
“Big insurers, too, are devising new financing plans with various payback options. Upstart players have also aggressively cut deals with doctors.”
This is already so unethical on so many levels…but wait, there’s more…
“The room for expansion looks ample, as rising deductibles, co-payments and other costs may force more of the nation’s 250 million people with health insurance to finance out-of-pocket expenses for even basic medical care.”
“‘As more and more of the costs of care are shifted to consumers, people are going to need more credit,’ said Red Gillen, a senior analyst at Celent, an insurance and banking research firm. ‘They are still going to need health care.’”
The companies say that the zero-percent financing deals will allow patients to pay off their procedure with no interest rates – that is, until they miss a payment, or take too long to pay it off…then you are in it up to your ears.
The NYT continues:
“Some consumer debt experts warn that as more people try to bridge widening gaps in their health insurance, paying for medical care on credit could plunge the unwary into a financial crisis. In recent years, the use of high-interest credit cards to pay big medical bills has become a leading cause of consumer bankruptcy.”
Here, we aren’t sure who to be more disgusted with: the credit card companies for taking advantage of, in many cases, sick people – and the fact that more and more, even routine procedures aren’t being covered by health insurance…
Or the health care companies for just, well, being slimy.
Or, you know, the government for backing these sleazy actions…
It’s a toss up. And no matter which way you cut it, those in need of health care are being taken for a ride.
Short FuseThe Daily Reckoning
It was a beautiful day in Paris yesterday. The sun was veiled, but the air was warm. The city is coming back to life after the summer vacation. People clear out in August. Now, they are back…buying school supplies…trying on new clothes…filling up the cafes…and stealing taxis from one another.
We came to town to visit our sick friend.
“When you are dying,” he said, “it concentrates your attention. I have had to think like a mafia capo. I need to figure out how to organize my affairs so my children don’t fight over things…and so life goes on without too much disruption. There’s a lot to do. So, I’ve been in the hospital for the last two weeks, but I haven’t had much free time. I’ve been operated on…and had tests…tests…and more tests. And then I’ve had to deal with so many of these practical questions. Not much time to read or reflect.
“There are little details too. I think I may have forgotten to close the windows…or to change the oil in the car. I need to tell someone.
“On the other hand, what difference does it make? It certainly won’t make any difference to me. I wonder why I’m concerned about these things. But I have been. And maybe that’s what keeps me from getting depressed.
“The doctors still don’t know exactly what is going on…but they know I have a form of lung cancer that is hard to treat. I’m going to have chemotherapy starting tomorrow…but it has only maybe a 15% to 30% chance of working. I had a friend who had something similar. She died in the chemotherapy stage. That could happen to me too…because it makes you very sick.
“But the interesting thing has been the way this illness has brought my family together. You know, my wife and I have not lived together for 15 years. We are Catholics. We did not divorce. And there’s nothing in the religion that prevents us from living apart. And really, it was better for everyone that way. We actually came to understand and appreciate each other more. And recently, I guess you could say we have reconciled.
“Some would say it was not an ideal marriage or an ideal arrangement…but I do not regret anything. No marriage that I have ever seen is ideal. You just have to do the best you can with what you have.”
We chatted for an hour. We gave him a copy of our latest book – co-authored with Lila Rajiva (Ms. Rajiva turned out to be the perfect person to work with, in many ways, because she brought an entirely different perspective; she’s a woman, a philosopher, and an Indian. She couldn’t be more different from your author…and yet, we found common ground. You’ll see the result in Mobs, Messiahs, and Markets…).
And then it was time to leave. We waved goodbye, as he was taken away in a hospital van…for more tests. We wondered if we would ever see him again.
“15%…30%…maybe the odds are as high as 50%…and 50/50 is even odds,” we had said to him. “And even odds are better than investors get.”
Then, after leaving the hospital, we were in a strange mood. We did something unusual. The French have a word for it – flaner. Usually, we walk so fast we practically knock over old ladies. This time, we strolled lazily. We walked through the garden of the Museum of Natural History…we stopped in books stores…even in a bookstore that sells only comic books, many of them for adults only. We gawked at furniture in the shop windows…and stopped to read about apartments for sale. We had lunch in a little brasserie on the Blvd. St. Germain, while reading a short history of ancient Scythia. One thing after another…not looking for anything in particular…not going anywhere in particular…not thinking anything in particular.
We were like a cork bobbing on the ocean…not knowing where we would wash up. We bobbed almost all afternoon…until late in the evening…when we tired of bobbing…and were making our way home.
“You look like you could use a little distraction; you look so serious,” said the woman at the Arc de Triomphe.
“Ah yes…you are probably right…but…”
“Returning from a three-day trip to Iraq and Jordan, Senate Chairman of the Armed Services Carl Levin (D., Mich.) declared the Iraqi government ‘non-functional’ and recommended that Prime Minister Nouri al-Maliki and his cabinet be replaced. ‘We care for our people and our constitution,’ said Maliki, who was visiting Syria, ‘and can find friends elsewhere.’ The U.S. Justice Department released documents showing that Dr. Ayad Allawi, Maliki’s chief opponent and the man most likely to replace him as prime minister, is paying the G.O.P. firm Barbour Griffith & Rogers $300,000 to lobby on his behalf.”
Pssst…Senator…the Prime Minister of Iraq was elected…elected, remember? You can’t replace him without holding another sham election.
And what’s this? Looking through the headlines, we notice that America is really trying to flex some muscles where Iran is involved. Dave Gonigam, writing for the DR blog explains:
“We begin with what could have been an extremely close call – a raid at the Baghdad Sheraton, during which U.S. forces arrested eight people from the Iranian Electricity Ministry who were in town to negotiate a deal with the Iraqi government. They were later released, found to have done nothing wrong, but only after the intervention of Iraq’s prime minister, Nuri al-Maliki. (Who says he’s an ineffective doofus?)
“But before it was all over, the eight men were bound and blindfolded, and trotted before TV cameras – which struck me as about as provocative a move as Washington could ever orchestrate. Well, maybe it wasn’t orchestrated, it might well have been an accident, but to give those guys the same treatment as the U.S. embassy hostages in Tehran in 1979 sure seems like rubbing the mullahs’ face in it.
“So that’s one provocation that hasn’t panned out. But there are always presidential speeches. And George W. Bush delivered a doozy yesterday to the American Legion…”
That’s all for today…after all, we are on vacation…
Bill BonnerThe Daily Reckoning
The Daily Reckoning occasionally features commentary from financial analysts, experts, gold bugs, economists and an array of contributors from various fields and occupations. Their diverse insights and contrarian investing ideas are hand selected by your Daily Reckoning editors.
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