Though I’ve lived in the US for 7 years, it feels a little odd to be working today. Today is Remembrance Day in the Commonwealth (Veterans Day in the US). Many in Canada attend ceremonies today to see or place wreaths laid to honour the fallen. It is common to wear a red poppy on your lapel and the day tends to be reserved and respectful. I miss it here. That’s a funny thing with traditions and I – easily adopt new ones, but hate to drop old ones.

It seems the question I asked early in the year has been soundly answered, for now. Deflation is the name of the current game, not inflation. Money supply has been demolished through credit collapse and hording of the leftovers. The surprising thing in all of this to me is how strong the US dollar has stayed relative to other currencies. This seems to be because of three things:

1. In some cases the US wasn’t as exposed to its own bad investments as the rest of the world was
2. The rest of the world is not decoupling from the US economy, this is a global downturn
3. There is still a perception that there are few places to stash a lot of cash safely other than US bonds

The third point is surprising to me. I would have expected the market to hunt out new strongholds to stash their cash. Perhaps that shift will only happen gradually.

Long term the value of the dollar depends on what happens with the economy. As the CS Monitor asks – Who will bail out the US Govt? Currently it is foreign investors buying US bonds and others looking for safe haven. However, if stimulus after stimulus are given or the upcoming debt obligations with Social Security and Medicare obligations are not handled, I don’t see how the US dollar is going to stay stable. At some point the debt load for the US will become critical – once that happens there is a very real risk of the US defaulting or trying to inflate its way out of obligations. Both would be catastrophic.

The LA Times reports “Tensions between McCain and Palin camps come to light“. Might be interesting, let’s take a look:

“…aides to John McCain disclosed new details about her expensive wardrobe purchases and revealed that a Republican Party lawyer would be dispatched to Alaska to inventory and retrieve the clothes still in her possession.”

That’s pretty damned funny.

“Fox News reported Wednesday that Palin’s lack of knowledge on some topics also strained relations. Carl Cameron reported that campaign sources told him Palin had resisted coaching before her faltering Katie Couric interviews; did not understand that Africa was a continent rather than a country; and could not name the three nations that are part of the North American Free Trade Agreement — the United States, Canada and Mexico.”

That’s pretty damned sad.

Best of luck, Obama. You are going to need it to deal with the mess that has been left for you.

• Marketplace has some ideas on what will happen on the economic side when Obama comes into office.
• Horizon had a program called the President’s Guide to Science. Worth a watch, but you might have to bend some rules to see it this side of the ocean.
• The FT reminds us that expectations could not be higher.
• The Telegraph believes Obama should be cautious. They remind that Clinton had a similar situation – bold mandates and control of the house and senate in ’92. But Clinton’s push failed – the reforms were too radical.
• What the word expects, from BBC
• Obama has started his presidential transition team, but won’t announce his cabinet until after thanksgiving.  I’m looking forward to new secretaries and heads of agencies.

Photos of diving Scripps Canyon

There was some epic visibility last week that I just caught the end of on Saturday, during a Scripps Canyon dive. The shallows were quite nice, but a little bit of a dead zone. Mistaking a crab trap for the new canyon line, we dropped in to find sheep crab tripping over each other to climb in. The canyon was bright and full of life as usual. I always forget how long the swim back to the pier underwater is (total run time for the dive was an hour, max 125′), but it definitely helps with off-gasing. I feel a lot better doing the long underwater swim back, rather than doing a slow accent, safety stop, and surface swim.