Wednesday, June 24, 2009

Clara's 5 Tips for the Hard Times

Some of you will perhaps remember my post on "Depression Cooking With Clara" a few months back. Well, it's time for some more help from Clara. Here are her "Five Tips for the Depression," a special short video.

Clara now has a DVD for sale. I think it would be worth buying. I absolutely LOVE this woman. We need to hear her stories and draw strength and encouragement from her experiences.

I'm learning, too. Just the other day we got a roast chicken from Wal Mart's deli. After dinner, there was a pile of bones, skin, and some small meat deposits left on the plate. On a whim, I plopped that carcass in a pot and boiled it for two hours, then I cooled it and picked all the meat off the bones. I returned the meat to the pot. Now I had a real nice chicken stock. From there it's easy.

Sautee one finely chopped onion in olive oil. Add 3 finely chopped carrots (not the baby carrots, they're too sweet) and a chopped bell pepper and a little garlic. Sautee until soft. Once things are softened up a bit, pour the whole thing into the pot of chicken stock, oil and all. Add a small package of black beans. Add salt, black pepper, white pepper, cayenne pepper, cumin, oregano, and basil to taste.

Cover and simmer for a couple of hours and then turn it off and let it sit covered on the stove overnight. The next morning, check the moisture level. Add water if necessary. Keep it covered. Warm it up and simmer some more. You can't let this stuff cook too long, so don't worry. As long as you don't let things dry out too much and scorch it, it just gets better and better. Cook some rice (the long grain, slow cook rice is best. It sticks with you longer because it doesn't spike your blood sugar.) About a half hour before you want to eat it, take the cover off so the moisture evaporates and it thickens a little. Pour it over the rice and presto. You've just made a Clara-esque mean with a down South flare.

Tuesday, June 16, 2009

Turning Point

It's important to remember that the stock market isn't the economy. But it's also important to remember that both the stock market and the economy are controlled by one thing: mass social mood. The stock market is an excellent barometer of mass social mood, and can give reliable direction concerning what the economy is doing.

Some in the bear camp are openly calling the rally from the March lows over and done with. And I think I agree. The short term question is, for how long?

I wrote a couple of weeks ago that we were at an important fork in the road. We shall soon see which direction we will take.

If all of the action since the early March lows is an extended Wave IV in Elliott Wave terms, then we should fall from here and make a new low, and then a furious, multimonth rally will follow. I would expect that bottom to happen in the September-October time frame of this year.

If what we have experienced since early March is the furious, multimonth rally I anticipated above, then we will probably go down and test (or even marginally violate) the March lows, and then rally all the way back up again, with Dow 9500 being quite possible. Then we will turn down and head for new lows through 2010 and beyond.

Either way, the stock markets still have more down in front of them before we make a lasting bottom. That is all but certain. The only question is, how much bounce is there in the near future?

The key level to watch is 6400 Dow, 666 on the S&P 500. The Dow is a little bit of an unreliable indicator because last week they kicked Citigroup and GM off the Dow and replaced with with other companies, so it's not the same index it was in March. The S&P is a broader and more reliable indicator.

Those of you who haven't bought gold and silver will probably have another opportunity to do so a little later in the summer. I think we could see $880 gold and $11.75 silver soon.

I also wrote that I anticipated $80+ oil and $3 plus gasoline through the summer because of a technical bounce in the oil markets. The price should come down again this Fall. A friend who listened to my counsel pre-bought most of the diesel fuel he needs for his business in April and has saved himself a tidy sum already.

Once again, the "green shoots" are weeds. The bounce in housing starts and the increase in the PPI are temporary sentiment blips on the radar and will not last. The bottom is not in. The economy is not turning around. More pain is around the corner. Keep your powder dry and you will have the opportunity to scoop up real bargains at the bottom.

Sunday, June 14, 2009

Why I Am Still A Deflationist

Gary North is a Christian economist. He's no dummy. He's an inflationist. I'm a deflationist. I can be convinced to change my mind, but I've got to see evidence. I've got to see consumers with so much money in their pockets that they've got to spend it on something today, because goods they need will be more expensive next week. So far, I don't see any of that. Below is an article which (for now) supports my case.

Notice also that he mentions that the FDIC is almost broke. The FDIC is the entity which insures your bank deposits, up to $250,000. How can the FDIC get more money? Two ways. The first way is to increase the fees it charges for the member banks. In other words, to sock it to the solvent banks to prop up the insolvent ones. Of course it doesn't take too much socking in this environment to turn a solvent bank into an insolvent bank. The other way to get more money in their slush fund is to go to Congress and/or the Fed and ask for it. But do you feel like bailing out any more banks? Me either. If you have a lot of money in a checking or savings account, consider taking the bulk of it out and putting it in a safety deposit box. Or spread it around in several banks. Also, keep 2 months living expenses in cash at home. If your bank goes belly up, the FDIC is taking 4-6 weeks to get you your money. That's assuming they still have some to give you.

Bankers Are Scared. Are You?

by Gary North

"What, me worry?"

From its beginning in 1954, the official representative of Mad Magazine has been Alfred E. Newman. He is a dim-witted looking fellow, always smiling. His slogan is, "What, me worry?"

Half a century ago, I took an image of Alfred and turned it into a campaign poster. I was running for student body president at my high school. I pasted a poster with my name and his picture on it on every locker on campus. I did it twice. I won.

Today, the person I defeated is a professor of business. He was one of the 535 economists who issued a public warning about the anti-growth effects of Obama's tax hikes.

He is worried. So am I. He and I are still in the labor force. We see what is coming for those who aren't.

"What, me worry?" You bet!

In contrast, ever since March of 2009, stock market investors have been sticking with Alfred. He still speaks for my generation, most of whom are retired, as well as for those aged 35 to 55, who haven't a snowball's chance in Yuma of retiring. They're not worried.

But their bankers are. One statistic more than any other reveals just how worried they are.


The Federal Reserve publishes this statistic. I have a link to it on, under the free department, "Federal Reserve Charts." You can check it weekly. Here is what it looks like these days.

This graph tracks what is sometimes referred to as the velocity of money. It is an indicator of the number of exchanges for money per unit of time. A dramatic increase or decrease in this statistic is rare. People stick to their budgets pretty closely. Bills get paid monthly. Expenditures reflect closely people's monthly incomes.

Ever since the September 2008 financial crisis, this statistic has fallen as never before. It looks as though it went over a cliff.

Why? It was not that people stopped spending. Bills must be paid. Companies still meet their payrolls. The basics get taken care of.

What happened is that banks stopped lending. Bankers looked at the financial markets, and they abandoned faith in Alfred E. Newman.

Use Photoshop to put a beard on Alfred's image, and then shave off most of his hair, and the image bears a remarkable resemblance to Ben Bernanke. Anyway, I see such a resemblance. So do most bankers.

Since September 2008, the Federal Reserve System has approximately doubled the monetary base. It has bought T-bills and Fannie Mae and Freddie Mac debt. It has lent newly created money to buy toxic assets from large American banks. It has loaded up on assets, creating new money to pay for this. Its balance sheet is twice as large.

Yet this money is not flowing into the economy. It is flowing into the banks, but the banks are parking it with the Federal Reserve System. The FED pays them the going rate for overnight money, something in the range of one-tenth of one percent. This is not what I would call a compelling rate of interest. Yet, for bankers, it is very compelling. They prefer to lend this money to the FED, which refers to this money as excess reserves, rather than lend it to producers or consumers.

"Wait a minute," you should be thinking to yourself. "If the banks pay 2% to depositors and then turn the money over to the FED at a tenth of a percent, the banks will be bled dry. They can't make it on volume."

Banks are walking away from far higher rates of return. They are carrying the existing system by lending to high-interest borrowers who still use their credit cards, but only if the borrowers are making their monthly payments. But banks are no longer willing to lend most of their post-September legal reserves to the general public. They prefer to let the FED sit on the money. They are walking away from the interest they could earn on a trillion dollars of available reserves.

This is unprecedented. It is happening all over the Western world. Commercial bankers are not lending the reserves that central banks have made available to them through massive purchases of debt. The banks bought the debt. The recipients – when not banks themselves (toxic asset sales) – deposited this money in their banks. The banks then turned the money over to the central banks that created it.

The fractional reserve multiplication effect has broken down. The money multiplier isn't multiplying any longer.


This is good news for central banks. They have been able to fund a financial system that came close to crashing last September. They have been able to re-capitalize the largest banks, which were facing bankruptcy because of bad loans to over-leveraged hedge funds. The primary purpose of every central bank is to preserve the banking cartel by protecting the largest banks. These are the multinational banks.

This is not the official purpose of central banking. For example, the two-fold official purpose of the Federal Reserve System is to maintain high employment and the purchasing power of the dollar. This is public relations fluff. The dollar has depreciated by over 95% since the FED opened for business in 1914. This is revealed by the inflation calculator of the Bureau of Labor Statistics, a Federal government agency. The unemployment rate has always fluctuated wildly in recessions. The recession of 2007–9 is no different.

There have been some major bank failures and a few dozen local bank failures. The FDIC has depleted its reserves of T-bills. The Federal Reserve and the Treasury have subsidized these liquidations. The losses continue anyway. Commercial real estate is plummeting, and will produce hundreds of billions of dollars in losses for commercial banks. The residential housing market continues to plummet, with waves of mortgage re-sets scheduled for 2010 and 2011. There is end in sight.

But the FED has kept the largest banks, now gutted, from going under. It has done this by doubling its balance sheet.

This balance sheet serves as legal reserves for commercial banks. Because commercial bankers are petrified, they are not lending to the general public. They are lending to the FED. This has enabled the FED to achieve half of its two-fold assignment: preserve the purchasing power of the dollar. The Consumer Price Index is down slightly over the last 12 months. It only rose by a tenth of a percent in 2008 – the lowest in over half a century. The Median CPI, which I have used for many years as a better guide than the CPI, is in the 2% to 2.5% range. It is low, though not so low as the CPI.

On the other hand, the refusal of commercial banks to lend has undermined the other half of the FED's official assignment: preserve high employment. Month after month, the unemployment rate rises. This shows no signs of abating. But it is far easier for the FED to blame external market conditions for rising unemployment than it would be for the FED to explain (say) 50% price inflation.

What are bankers afraid of? The thing Will Rogers was afraid of in the 1930's. Homespun Will spoke for the nation when he said that he was more interested in the return of his money than the return on his money. So are the bankers.

Commercial bankers see that the economy is in a recession. Risk of default rises in a recession. Bankers know that they are beyond criticism by the government or by the Federal Reserve if they deposit funds with the FED. They know they will get this money back. They are in the safest investment the economy offers to bankers. They are beyond criticism from agencies that are in a position to impose negative legal sanctions. The bankers want safety more than return. They want immunity from legally effective criticism. They want safety. So, the money multiplier has fallen like a stone. This has kept price inflation low.

The greatest source of new jobs is small business. In second place are medium-size businesses. Economists and policymakers have known this for at least two decades. But small businesses are among the highest-risk borrowers. Those that survive do hire workers. Those that do not survive fire workers and stiff their bankers. In the aggregate, small business loans pay off, but bankers in a recession know that the odds of survival get lower. They decide to seek safer borrowers.

So, central bank policy has kept panic from spreading to the general public. There have been no runs on the banks. There has been no replay of the bank runs of the Great Depression. A bank run today involves taking digital money out of one bank and transferring it to another bank. The money supply does not shrink. The system as a whole survives. The cartel survives. This is the FED's #1 purpose, and it has served its clients well. Its clients are commercial banks.

The public has posted digital thumbnail photos of Alfred E. Newman onto their bank statements. So have the retirement fund managers who act on behalf of the public.

The commercial bankers have not.


The buzz words among optimists is: "green shoots." These green shoots are evidence that economic springtime beckons. The cold, dark winter is receding. The experts who did not predict the dark winter – who denied it even existed – are confident that there are signs of economic growth. These signs are in the form of less-bad news.

The premier mark of economic recovery is that small businesses are again hiring. They are borrowing to launch new projects. Their owners have seen compelling evidence of an economic turnaround. They are ready to commit new capital to meet the demand of buyers in the future. They are ready to go to their bankers and say "Shoot me some green."

This is not happening.

When it does happen on a widespread basis, the chart of the money multiplier will reverse. We will see a sustained increase in the multiplier. This will indicate a change in the assessment of bankers regarding the prospect of recovery. They will decide, case by case, that business borrowers are sufficiently confident regarding their firms' prospects that they are willing to place their businesses' collateral on the line.

This is not happening.

Bankers want to see confident businessmen. They want to see businesses with collateral worth repossessing in case of a default. They want to see businessmen who put their companies' future at risk for the sake of expansion. Bankers are not going to shift their banks' funds out of excess reserves at the local Federal Reserve Bank on the basis of Ben Bernanke's sharp-eyed perception of green shoots, or some unknown fund manager's appearance on CNBC, who assures viewers that it's time to get back into the stock market. They are going to shift funds when they are confident that they will get the money back from the corporate borrower.

This is not happening. Why isn't it happening? It has to do with businesses whose collateral is suspect. Toxic investments are now perceived as toxic.

It has to do with businessmen who regard their companies as their life's work, and who are unwilling to place the survival of their companies at risk on the basis of green shoots. Green shoots in general are neither here nor there for a business owner who is must place his company's survival at risk. It is the local market that counts for him, and his niche in that local market, that matters.

It has to do with bankers who know they have made rotten loans in the past, whose banks' balance sheets would call in the FDIC if the assets legally had to be marked to market: a sale price based on a rapid sale. It was only April's reversal of the Financial Accounting Standards Board – under intense pressure from the government – that saved these banks from insolvency. The FASB allowed creative reinterpretation of FAS 157, which mandated market pricing of bank assets. These bankers are not interested in risking any more of their banks' capital in a series of premature loans to local businesses.

It has to do with commercial real estate loans. Local banks that sold mortgages to Fannie Mae and Freddie Mac were not hurt by the collapse of residential real estate. But they took their depositors' money and invested in companies developing commercial real estate. These ventures are the next shoe to drop. Banks need liquidity to cover for the losses that are now inescapable. Money lent to local businesses is not liquid.

For whatever reason, commercial bankers are telling Bernanke, "Show us the money!" The story of the green shoots may convince fund managers that happy days are just about here again, but it has not persuaded the bankers who have the money. When bankers are lending to the FED at the federal funds rate – a tad over 0% – the people with the money needed to water those green shoots are turning thumbs-down on the green shoots story.

They are frightened. Talking heads on CNBC aren't. Take your pick.


Those who predict price inflation believe that the money multiplier will turn upward again. They just don't know when.

Those who predict price deflation believe that the money multiplier will not turn upward again. Indeed, it must fall much further. Prices are close to stable today. To get to significant decline – 5% or more per annum – the money multiplier must continue its downward path.

I am in the inflationist camp. But until I see a sustained reversal of the money multiplier, I will continue to predict relatively stable consumer prices.

But not for real estate. It will continue downward. Families' net worth will continue to fall. There will be deals. Commercial rents will continue to fall. There will be deals. Small local banks will continue to go belly-up. There will be deals . . . for big banks.

That is the goal of the Federal Reserve System: to create deals for big banks at the expense of little banks. It always has been. The FED is not about to change at this late date.

Small bank managers are scared. They should be.

How about you? Do you think the fractional reserve banking system is on your side? Do you think fiat money is productive capital? Do you think you will retire in comfort, based on government promises? Do you think you're in good hands with Big State? If so, sit tight. Do nothing new. Just keep repeating Ben Bernanke's mantra.

"What, me worry?"

Thursday, June 11, 2009

Lies, Damned Lies, and Statistics

"Figures often beguile me, particularly when I have the arranging of them myself; in which case the remark attributed to Disraeli would often apply with justice and force: 'There are three kinds of lies: lies, damned lies, and statistics.'"
-Mark Twain

Because the Powers That Be understand, at some dim level, that our mass social mood moves the economy, they set out to manipulate that mass social mood using the media. Just for instance, it didn't come out until well after the fact that we were hours away from a worldwide financial meltdown last fall when a money market fund "broke the buck." According to Congressman Paul Kanjorski, Fed Chairman Ben Bernanke and Treasury Secretary Hank Paulson appeared before Congress and said,

On Thursday (Sept 18), at 11 am the Federal Reserve noticed a tremendous draw-down of money market accounts in the U.S., to the tune of $550 billion was being drawn out in the matter of an hour or two. The Treasury opened up its window to help and pumped a $105 billion in the system and quickly realized that they could not stem the tide. We were having an electronic run on the banks. They decided to close the operation, close down the money accounts and announce a guarantee of $250,000 per account so there wouldn't be further panic out there.

If they had not done that, their estimation is that by 2pm that afternoon, $5.5 trillion would have been drawn out of the money market system of the U.S., would have collapsed the entire economy of the U.S., and within 24 hours the world economy would have collapsed. It would have been the end of our economic system and our political system as we know it.

Hear it for yourself here:

Nope. They waited months to say that, and if Congressman Kanjorski hadn't flapped his gums on CSPAN, we probably wouldn't know it even now. Better to leave that sort of thing for your grandchildren's history books, fifty years from now. You can bet the good Congressman got a stern talking to later that afternoon.

In the past few weeks we've been presented with government statistics that seem to paint a rosier picture of the economic landscape. "The bottom is in. Green shoots are sprouting." they say. Well, let's look at the evidence.

"The Unemployment Picture is Improving" we were recently told. The unemployment rate actually spiked to 9.4%, but it didn't increase as fast as some were expecting, so that's counted as good news. During the Great Depression, we're often told, unemployment hovered at around 25%. What we're not told is that if we used the same statistical methods to measure unemployment today as we did back then, today's unemployment figure would be just under 20%.

Just today we were told by the U.S. Department of Commerce that retail sales rose. That's got to be good, right? Isn't increased spending a sign of economic health and confidence? Well, actually, no. Retail sales rose in May relative to April's figures. Why? Gasoline has gotten more expensive in the last few weeks, which has bumped up prices of everything, meaning we spent more in May than we did in April to buy the same things. That's actually harmful.

But what is relevant is to compare this past May to May of 2008. And what do we find? Purchases of gasoline are down 33.8% from this time last year (when gas was almost $4.00 per gallon!) Sales of new cars are down 19.6% from last May. Retail sales were down 9.6% compared to last May. That's actually the worst year-over-year plunge in retail sales in the post WW II era, or in other words (do I even need to say it?) SINCE THE GREAT DEPRESSION.

May housing starts were off 54% from last year. Worst performance since (wait for it!) THE GREAT DEPRESSION.

1Q 2009 Industrial Production figures showed the biggest collapse since the shutdown of all the wartime industrial production at the end of WWII. In other words, if you take out the artificial situation of a world war ending, and thus the cessation in production of tanks, guns, ships, fighters and bombers, jeeps, etc. the first quarter of 2009 was the worst showing since (tired of hearing it yet?) THE GREAT DEPRESSION.

We're now told that in certain areas of California, real estate has collapsed back to 1989 price levels. Good. Now we're getting close to a bottom in those markets.

The real estate market isn't done correcting. Not by a long shot. We have not yet seen the effects of the collapse in commercial real estate that is happening right now. There is a wave of ARM resets coming in late 2010 and early 2011 that is almost as big as the wave that precipitated the beginning of the housing crisis. Mortgage interest rates, which are tied to the 10 year Treasury market, have jumped up more than a full point in the last 3 weeks. That's going to put a further drag on refis and new home purchases. A drag which the economy can ill afford. Foreclosures are down, but that's because banks have realized that

1. They can't repay the TARP money and get out from under Uncle Sam's oppressive oversight if they show a bunch of non-performing loans on the books and

2. That empty houses get gutted and trashed and are worth even less than they were at foreclosure.

So banks are letting people stay in their homes under very favorable terms, often for token payments. Obviously they don't want to be too public about that, because people are like children on a playground. Give one kid a cookie and everyone else will be asking for one, too. But that is what's happening. Particularly in the People's Republic of California, Las Vegas, and Michigan. People are getting to stay in their old homes for as little as $100 per month.

Why do I say all of this? To distress and depress you? No. I say it so that you can make sound decisions. If I'm wrong, and recovery is just around the corner, then you have not been hurt in the least by my advice. You have gotten your budget and your lifestyle under control. You have eliminated debt and started saving money. You have bought a little gold and silver which will always be worth something (unlike your General Motors, Citibank, and Chrysler stock.) If you need to sell real estate, now is your window of opportunity. Price it aggressively and get rid of it. If you're considering buying real estate, don't. Not unless you can't put it off, or you can afford to watch it lose another 20-30% of its value before it bottoms. If you want to buy a new car and you can get 0% financing or something like that, this may be a reasonably good time to buy. I still think there will be better times to buy. If you're in the market for a good used car, wait. Prices will come down when people have to sell their cars.

On the other hand, if you are in the market for an SUV or a full sized pickup, now is an excellent time. Lots of people are afraid of the gas prices, and lots of contractors and people in the construction trades are leaving the industry and having to sell their vehicles and equipment. I just picked up an 85 Ford F150 with 90K miles on it for $750. It's also a good time to buy used construction equipment. The market is flooded with it. This would be a good time to open a pawn shop, or to start a business that buys and sells gold and silver. It would also be a good time to open a certain kind of restaurant... one that specializes in cheap, filling food. White Castle Hamburgers, for instance, went like gangbusters during the first Great Depression. Something like that, but with a 21st century twist, would probably do very well now. Look at what the poor eat in other countries for clues. A mobile taqueria, or an Asian style noodle restaurant, or a barbecue joint that can take cheap cuts of meat and make it taste delicious are probably good bets.

Now is a good time to be a mechanic, or to open a mechanic's garage. People are keeping their cars longer and fixing them. In general, if you have a skill that includes repairing things that break, now is a golden opportunity. Plumbers and heating and air conditioning repair technicians will probably do well during the next few years. If your job relies on selling new things, you're probably going to be hurting. If your job relies on the whims of the wealthy, you are in trouble. Find another industry. They are not going to be employing as many masseurs and valets and personal chefs and gardeners as they had before.

Above all else, trust God. Save money. Pay off your debts. Live simply and frugally, well beneath your means.

Tuesday, June 9, 2009

Small Towns

Today I'm going to extol the virtues of life in a small town, especially during this unfolding Second Great Depression.

First and foremost, life in a small town is generally cheap compared to suburban or urban life. While my town, Sturgis, is still somewhat overpriced in the real estate department, I am confident that will soon change. But in many small towns modest, well cared for houses can be had for well under $100,000. For instance, I am friends with the OPC minister in Carson, ND. I preach at his church from time to time when he goes on vacation. Carson is a tiny town about an hour southwest of Bismarck. A few years ago the church sold the manse in order to purchase a house outside of town with some acreage, affording their pastor a more rural lifestyle. The manse, a neat, tidy home of about 1300 square feet which had new windows and some recent updates, sold for less than $28,000. It was bought by a man who lives elsewhere and likes to pheasant hunt in that area. He occupies the house less than 1 month per year.

With the advent of the internet, small town living is not as remote from some amenities as it used to be in decades past. Nor is it as bereft of economic opportunities as it used to be. Consulting, home-based businesses, or sales jobs with a large territory where it doesn't matter where you live within the territory make small town living quite lucrative and pleasant.

Secondly, small towns are safe, generally speaking. Just as a for instance, this past January when it was 20 degrees below zero, I went to the grocery store. I don't like starting cars and turning them off for short hops when it's that cold. It increases the wear on the engine. So I left my Blazer unlocked and running in the grocery store parking lot for twenty minutes while I went inside and did my shopping. When I came back out, the vehicle was, of course, still there. If we forget to lock the doors at night, we don't fret about it. I almost never lock my car, and have been known to forget and leave the keys in it. Nobody's ever bothered my stuff. In Lemmon, SD, about two and a half hours up the road, the gas station that sells used tires has them outside on a rack. They're not locked up. Anybody could steal a tire. Nobody ever does. The pastor of the PCA church there says, "I live in Mayberry."

People in small towns tend to be more self-reliant. I have a friend who is a Meade County Sherrif's deputy. Now, I'm told that Meade County is one of the largest counties in the United States. But our Sherrif's department isn't that big. I asked him where his patrols took him. He said he spent almost all of his time on I-90 and its environs between here and Rapid City. He said he had been up to Faith (about an hour north of here) only once, and that was for a charity basketball game. I asked him who patrolled up there. He said, "No one. Those people take care of their own problems." That kind of self reliance is a handy skill, and most people are quite willing to teach you what they know if they like you and you ask them. I know who to go to when I need advice about chainsaws or woodstoves or tractors or gardens or raising chickens or any number of things. When we have a blizzard, we don't sit around waiting for the government to declare us a disaster area. We know our municipal and county crews are not numerous enough to do everything in a timely fashion. We simply dig ourselves out. Half to three quarters of the snow removal in Sturgis is done by people using their own equipment, even without pay. During the November '08 blizzard, one rancher hopped in his high loader and plowed the way into town one bucket of snow at a time. Then he cleared the road into my neighborhood and dug out several of my neighbors who had drifts 8 or 10 feet high in their driveways. We bought him a tank of diesel fuel and gave him coffee and cookies.

The thing I like best about small town living, though, is the built-in sense of community that comes after you've spent a few years living in one. You can't be arrogant or pushy or high-handed with small town and country people. They're not stupid. They're not uneducated. They're not bereft of culture. If you're humble and helpful and kind, they will generally respond very well and after awhile you will find yourself to be adopted into a huge, extended family. I am friends with my dentist, my doctors, my veterenarian, my insurance agent, and my machinist. If I needed a barber, I'd be friends with my barber. But even though I don't ever need a haircut (see my photo for an explanation) sometimes I go over to his shop and sit down and drink a pop and shoot the breeze. I know the manager at the local grocery store. I know the clerks at the post office. I know the guy who sells me my propane. I'm friends with the guy who repairs my computers. I taught a local police officer's kids Latin. When somebody's in the hospital, I just go. No signing in. No HIPA nonsense. Often as not they greet me by name and direct me to the correct patient without me even asking. When I go to the high school football games, I can hardly walk ten feet without being greeted by somebody, and many who greet me have no connection at all to my church. When I went to have an exhaust put on my new $750 Ford truck, the guy who owns the exhaust shop remembered me as the neighbor of his best friend... the one who had "talked Kirby into buying his old BMW." Since he's a Ford guy, he looked a bit askance at that, but in spite of that he gave me a good deal and great service. There is a richness of relationship here that I never found living in Minneapolis or St. Louis or Cincinnati.

And then, of course, there's rush hour. We don't have one. We have rush minute when the high school lets out during the school year, but that's about it. Rush minute means you might have to wait 60 seconds before you can make a left turn, instead of making it almost immediately.

Are there drawbacks? Sure. There can be. There can be petty fiefdoms and nasty people and corrupt cops and malicious gossip. I ran into those in other small towns, but not this one. But it's also been my own observation that I inadvertantly caused many of my own problems simply by not understanding and respecting the culture, and being young and dumb and arrogant. That observation has held true for others. You've got to watch what you say and who you criticize, because you're liable to be talking to his cousin or standing right next to her sister-in-law when you say it. But watching your tongue is a good rule for a Christian, whether anyone related or relevant is listening or not.

If I were to give advice to any new seminary graduate, it would be to seek out a small church in a small town, and hunker down for eight or ten years and learn to be a pastor. And by that, I mean a pastor. A shepherd of the flock of God, a healer of sin-sick souls, not an administrator or a programmer or a pulpiteer. Go with your parishoners or your neighbors when they invite you fishing or ask you if you want to ride in the combine during harvest. Ask questions. Show an interest and ask to be taught. Offer to drive the grain truck to the elevator if they'll teach you how to drive a truck with a splitter and an unsynchronized transmission. If you've got a strong stomach, go with them for castrating and branding the calves. Whether you eat the mountain oysters or not is up to you. It'll teach you a lot about the people you pastor. It's good for them to have a chance to teach you. That spirit of reciprocity will make it easier when it's time for you to teach them. Plus, they'll know that you're not a careerist who will be gone inside of three years. They'll know that you don't see them as a means to an end. When they know that, they'll talk to you about their doubts and their fears and their problems.

Yessir. There are few places that I can think of which would be better to ride out a depression. Find yourself a small town and hunker down. You'll be glad you did.