Food for thought, a black horse and a view from Saturn

Anyone can throw a bunch of graphs together and draw a conclusion whether it sticks or not. In fact it seems that most media, newspapers and journalists do just that and present their view on what reality should look like contrary to what their real job description should be: report on the facts, not opinionise their own views. In the spirit of "if it's good enough for them it's good enough for me" I have... No wait, lets do it differently. I am going to present you three graphs and there is a relation between two. The third one I have thrown in for your contemplation. I didn't make up the graphs either, I'll give you the references where they can be found.

First let me tell you that we are not looking at Europe this time but at the US. And the first graph show you the Dow Jones and Nasdaq since 2007. You can see the crash in 2008/2009 and the breathtaking recovery since (you can find these graphs on any financial website, I took mine from http://www.tijd.be). The second one comes directly from the US-FED website and shows the ballooning balance sheet since 2007 (http://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm). No the synchronised rise in the stock markets and the FED balance sheet is not a coincidence. The stock exchange recovery is a result of the FED quantitative easing programs that have exploded the FED balance sheet. Everyone agrees on this, that is why the stock markets get very nervous every time Ben Bernanke sneezes. Some are even so worried that when looking at these graphs they get Tourette-like symptoms as they can't help scream "BUBBLE".

Now for the last graph, number of US citizens who depend on food stamps, I made this one myself based on data from the USDA (http://www.fns.usda.gov/pd/SNAPsummary.htm) and I normalised it to the total United States population so it shows you the US citizens on food stamps as a %.

Since the seventies, this percentage hovered around 6-10%, since 2007 it started to rise and now they are approaching 15%. That's > 46 million Americans who are on food stamps. Is there a relation between this rise of food stamp dependent Americans and the US-FED balance sheet? I leave it up to you to draw your conclusions. If you need some guidance, read Joseph Stiglitz 'The price of Inequality' (http://www.amazon.com/The-Price-Inequality-Endangers-ebook/dp/B007MKCQ30).

Last week I told you I was reading a book in my hammock (no surprise there!), but I didn't tell you which one. The title is 'Ten Oorlog' ('To war'), and it is the book based on the documentary that was broadcasted this Winter on Belgian public tv in commemoration of next year's 100th anniversary of the start of WWI. It featured 3 friends who walked the complete European front line from West (Nieuwpoort) to East (Gallipoli), guiding us along the way through WWI, the monstrosities, the battlefields, the trenches ... But it was much more than a history lesson, their journey showed how WWI still affect today's lives of those who live in the area where fierce battles where fought. How the stories of then still live on in their families and how it changed their lives. It was an amazing road-movie with lots of memories quoted from the diaries and letters of soldiers who died and those who survived. The book is equally good. It is only in Flemish and I can recommend it to anyone who masters our language.

One of the diaries quoted from is the one of Earl Fransesco Baracca. He was a pilot and achieved 34 victories in air combat. On the side of his airplane (he flew the Nieuport 17 and Spad VII / XIII) he had a black stallion painted as tribute to his former regiment in the cavalry. In those early days of aerial warfare the respect for enemy pilots was high and the Earl was a real gentleman. Apparently he visited the pilots in hospital after he shot them down, or he paid tribute to them at their grave. Baracca didn't survive the war and was killed on June 19, 1918. His mother donated Baracca's personal emblem, the prancing black stallion, to car racer Enzo Ferrari and he immortilised it.

I have to show you one more image I came across this week. A view on Earth (where the arrow is) taken from Cassini which is orbiting Saturn. Images like these always take my breath away.