Blog on the Run: Reloaded

Saturday, September 25, 2010 5:55 pm

Playing catch-up

As blogging goes, I have been slackeriffic of late, so let’s see what I can do to get caught up here.

Damn. Maybe I should just stop now.

Ah, well, like the man said, I can’t go on. I’ll go on.

  • But we’re not giving it up without a fight: Barack Obama believes he has the power to order American citizens executed without charge or trial. The ACLU and the Center for Constitutional Rights are fighting that.
  • Some of America’s greatest leaders? Would be considered terrorists today.
  • They’re everywhere: Government at multiple levels in this country is blurring the distinction between dissent and terrorism. In Pennsylvania, where activists are opposing new oil drilling (entirely understandable, if not ultimately a good idea, in the wake of Deepwater Horizon), opponents are being monitored by the state Department of Homeland Security, and when the governor was asked about it, he at first defended the program.
  • And it ain’t just government: Monsanto hired Blackwater to monitor activists who oppose genetically modified seeds, despite the risks they pose.
  • Double standard: When the Democrats nominate someone who’s insane for the U.S. Senate, they disown him. When the Republicans do it, they embrace her and give her lots of money.
  • But, no, we’re not racists: The National Federation of Republican Women has Sen. Glenn McConnell attend dressed in a Confederate Army uniform and pose with African Americans dressed as slaves. In 2010. For reals.
  • Enthusiasm gap: If Democrats and the White House wonder why their base is so much less motivated to turn out in November than the GOP base, they might consider issues such as this and conclude that warning against “the return of George W. Bush” is pretty pointless when you’re going Bush one better.
  • In deep: How could the Deepwater Horizon disaster happen? When Interior Department regulators are being bullied by the industry they oversee and undercut by their managers, I’d say anything is possible.
  • Risk assessment: Emptywheel poses a very good question: Is the greatest danger to our financial system really terrorism?
  • Well, at least he’s honest: U.S. Sen. Tom Coburn, R- Okla., tells the American people to, quite literally, eat shit.
  • Scheduling an election is not rocket science. So would it be too much to ask that states get ballots to troops overseas in time for those ballots to be cast? Sheesh. (h/t: Fred)
  • Questions of ownership: GMAC, one of the nation’s largest home-financing firms, tries to foreclose on a home whose mortgage has been resold only for a judge to conclude, quite reasonably, that, hell, no, it can’t foreclose on something it doesn’t own; further investigation suggests GMAC may be executing 10,000 fake documents a month related to mortgages. As a result, GMAC foreclosures are on hold in 23 states. But the real fun, not obvious at first glance, is that dealing with this issue is going to make it harder for a lot of insolvent banks to hide the fact that they’re insolvent.
  • Maybe somebody should have shot the deputy: Charlie Munger, populist billionaire Warren Buffett’s right-hand man at Berkshire Hathaway, recently suggested that America’s unemployed and underemployed should “just suck it in” and added, “Thank God for bank bailouts.” Why would he say such a thing when BH took no bailout money? Uh, because companies in which BH is invested took $95 billion, maybe?
  • You will know him by his trail of dead: Howard Fineman, one of the most relentlessly conventional journalists in American history — and, therefore, a guy who has whiffed on most of the significant political stories of the past 15 or so years — is deserting the sinking ship at Newsweek to go work for the Huffington Post. Conservatives everywhere should be of good cheer; if he does there what he did at Newsweek, HuffPo will be dead inside of three years.
  • Who broke the Senate?: Something called “Gingrich senators.” That’s a very short way of describing what is actually a pretty well-documented phenomenon.
  • Apparently we need another war on poverty. Sigh.
  • Fight the police state: Reason magazine offers tips on how.
  • The Washington Post’s problems in just three words: It. Can’t. Think.
  • Funniest line ever posted at PowerLine, by Paul Mirengoff on Christine O’Donnell: “It’s great to hear that O’Donnell learned from her experiences dabbling in witchcraft. You wouldn’t want a U.S. Senator who dabbled in witchcraft and learned nothing from it.” Heh. Indeed.
  • Genetically, we’re not only close to apes, we’re pretty close to jackals: Nancy Nall on scrapping, physical and financial.
  • Corruption in Afghanistan: Not that big a deal after all, the administration decides.
  • When was the last economic recovery that WASN’T jobless?: Oh, about 20 years ago.
  • Question for everyone who still believes in “the liberal media”: What do you think would happen if DEMOCRATS had filibustered a defense appropriations bill? And, naturally, John McCain lied about the reasons for it.
  • He is the egg man: Austin “Jack” DeCoster, whose company was implicated in the recent problem with salmonella-tainted eggs, may have been the guy responsible for introducing salmonella into the U.S. egg supply in the late 1970s or early 1980s.
  • Larry Summers gone: The problem is, unless his replacement is named Warren, Krugman, Bakker Baker, Shiller or DeLong, we’re going to have the same problems we have now.
  • Fannie and Freddie weren’t the ones who broke the economy: So said Barry Ritholtz a while back; so says the FHFA now.
  • Alternatives to bank bailouts: Let me show u them. We did, in fact, have some, which is worth remembering two years on.
  • Chain of command: I’ve got little but contempt for Bob Woodward’s “reporting” these days, but if he has accurately reported that Gen. David Petraeus told colleagues that President Obama “is f—ing with the wrong guy,” then Obama should fire Petraeus and thank Woodward for bringing that insubordination to his attention.
  • The Tea Party isn’t just about deficits and taxes and spending: Whether it started out this way or not, it is rapidly being taken over, if it has not already been, by the Christian Taliban. (More here.) Despite already having called for Obama’s impeachment, I’m not under any illusions about what else is going to happen next year if the GOP regains control of Congress in November. Nobody else should be, either.
  • Kidding themselves: Even such normally sensible outlets as Zero Hedge are buying into this silly-assed notion that businesses aren’t hiring because of an “atmosphere of uncertainty.” No. There’s always uncertainty in the business world, not least every election year. The problem this time isn’t uncertainty, it’s that no one is buying anything because no one has any money because they’re in debt up to their eyeballs, unemployment/underemployment is at its highest level in three-quarters of a century and even the people who have jobs are afraid they’re going to lose them. Moreover, consumers are afraid, probably with good reason, that things will get worse before they get better.
  • Stop the presses!: The new version of the GOP Contract on America was written by a former lobbyist for Exxon and AIG.
  • Pre-emptive strike: Is a newly discovered super computer virus the means by which Iran’s nuclear threat will be nullified? And did the virus originate in Israel?
  • Apparently neither a joke nor an urban legend: Good news, ladies! Having unprotected sex, although it can put you at increased risk of sexually transmitted disease if you’re not really careful and picky and can, of course, get you pregnant, also can render you significantly less likely than your latex-dependent friends AND your chaste friends to suffer from depression. And there’s actually a chemical reason for this!
  • Even Napoleon thought the third time was enemy action: Glenn Fine, inspector general of the U.S. Justice Department, expects us to believe that three separate FBI investigative efforts of the Thomas Merton Center’s anti-war activities during the Bush administration were isolated, coincidental and in no way politically motivated. He also expects us to believe in unicorns, too, I guess.
  • On the road to recovery: Uh, not so much, says well-known liberal Paul Volcker.
  • Here’s the thing about Republican congresscritters and stimulus spending: The most offensive thing isn’t that they’re hypocrites for criticizing the program while still trying to land some of its money for their districts. It’s that they’re lying when they say it doesn’t work.
  • Good news, bad news, Internet edition: Radio spectrum being abandoned by TV as it moves to hi-def could be made available for next-generation WiFi at little cost to the public or, in the alternative, be auctioned off for that purpose at huge benefit to the Treasury. But that’s not going to happen.
  • I want to play Roy Blount in poker: The Republican candidate for U.S. Senate in Missouri challenged Democratic opponent Robin Carnahan to six debates … and then backed out of four of them after she took him up on it.
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Sunday, August 22, 2010 11:35 pm

Catchin’ up on stuff; or, Odds and ends for Aug. 22

  • Questions more people need to be asking about the deficit, answered.
  • Why, if I lived near DC, I might be tempted to burn a Confederate flag at Glenn Beck’s upcoming rally.
  • I think the F-bomb has become a highly convenient excuse to keep adolescents from seeing a movie that shows how the American government screwed over an American hero and lied to his family.
  • Apparently it’s OK for American journalists to write highly inaccurate articles as long as they do so in the right (pun intended) way. Relatedly, these days, a DC journalist, given the choice between giving a deserved screwing to a colleague and giving an undeserved screwing to the American people in general, will screw the American people every time.
  • Governmental foot-dragging has its intended effect: Tom DeLay walks free. There are no consequences. There is no accountability. Rule of law? Ha.
  • The Internet will be the death of the music bidness as we’ve known it. Of course, no one who has known it will shed a tear, but that doesn’t mean the bidness is going down without a fight. Now they’re partnering with the National Association of Broadcasters, another powerful lobby, to try to get the government to mandate the inclusion of FM radio in future cell phones. Good luck with that. Oh, and die already.
  • The question isn’t why “Dr.” Laura Schlessinger “quit” her radio show after dropping about 11 N-bombs. The question is why any responsible broadcaster ever allowed someone with such obvious mental problems on the air dispensing advice in the first place.
  • Despite rising wheat prices caused by Russia’s drought-driven ban on exports, U.S. wheat farmers aren’t sure they should plant more wheat. Why? They’re pretty sure the wheat market is rigged, just as it was a few years ago. Now someone explain to me again what social utility investment bankers serve. Relatedly, Harper’s makes the case that they’re just playing games with the world’s food supply.
  • August: Stupid American Month.
  • If The New York Times or CNN had contributed $1 million to the Democratic Governors Association, do you think the country would have responded with such a yawn? Me, neither.
  • So will all the Wikileaks critics shut up now that the Pentagon’s own evidence shows Wikileaks tried to work with the Pentagon to redact sensitive information but was rebuffed? Yeah. I thought not.
  • The oil from BP’s Deepwater Horizon disaster? Government reports to the contrary, it’s mostly still out there.
  • When it comes to protecting our rights and our privacy, those commies in Europe are eating The Land of the Free’s lunch.
  • You know how the government has always claimed Guantanamo detainees are “the worst of the worst”? In fact, the government lacks enough evidence to charge 3/4 of them with any crime at all.
  • The $75 billion Home Affordable Mortgage Protection Act is a bust … because Congress, after approving the money, did nothing to ensure that bankruptcy judges would use so-called “cramdown” provisions to make sure the money would do what it was supposed to do. What has happened instead has left a lot of homeowners even worse off than if the government had done nothing and has hampered the recovery of the housing market. And the administration hasn’t bothered to try to get Congress to do the right thing. Heckuva job all the way around.
  • Memo to Army Maj. Gen. Charles E. Chambers: Your punishing soldiers who opted not to attend a concert by an evangelical Christian rock band should carry punishment of its own: loss of your stars and your pension. You violated your oath to protect the Constitution, General, plain and simple.
  • Robert Frank has an interesting proposal that could help both government and consumers: The government should buy up consumer debt, on which consumers are paying 20% and up, and charge consumers 8%. This would put more disposable income in consumers’ hands and give the government a substantially better return on its investment than the 2.8% or so that 10-year bills currently are paying. It makes so much sense that there’s zero chance Congress will pass it because it would hurt deny banks their current flow of blood money.
  • Shorter Paul Volcker: Lending deregulation was bad because allowing higher interest payments on risky sub-prime loans encouraged banks to make more risky loans.
  • Barry Ritholtz: We’re good at saying “What if we had done nothing?” about the bailout, but an even better question is, “What if we had done the right thing?”
  • COOL (as it were): Scientists are working on a way to use carbon dixoide and certain kinds of bacteria to convert crude oil into cleaner-burning methane — while the oil is still in the ground. A separate effort is working on using solar power to convert CO2 to carbon, or carbon monoxide to, in turn, synthesize hydrocarbon fuels.
  • I have found my Official Anthem for the Summer of 2010. Unfortunately, it’s a bit too R-rated to link to, but I’ll give you a hint: It’s by Cee-Lo, from his forthcoming album.
  • Colombian Supreme Court to U.S. military: Don’t let the sun set on you in Bogota. Oops.
  • Thomas Frank, author of What’s the Matter with Kansas?, leaves the Wall Street Journal and tears U.S. news media several new orifices on the way out the door (whether he also grabbed a beer is not clear).
  • The U.S. Chamber of Commerce has apologized for a blog post suggesting that the male-female wage gap and the glass ceiling aren’t real problems, which might actually mean something if it would apologize for everything else it has said and done in that same vein for the past several decades. But it won’t, so it doesn’t.
  • The American Family Association apparently believes our soldiers in Iraq died for nothing. Actually, so do I, inasmuch as that war was illegal from the git. But you know why the AFA believes it? Because Iraq is not a Christian nation.
  • Would someone who considers him/herself a deficit hawk and supports extending George Bush’s tax cuts for millionaires please explain to me how we can afford to do that but cannot afford to put people to work?
  • And, finally, this week’s tasteless joke, from D. Aristophanes at Sadly, No!:

A priest, a rabbi and an imam walk into an Islamic center two blocks from Ground Zero. The bartender says, ‘What’re you drinking?’ and the imam orders him beheaded because sharia law dhimmitude Allahu Akbar alalalalalalalalala flabberty jabberty jabber etc. etc.*

You’ve been a great crowd! We’re here all week!

*Also the priest molests the bartender’s kids and the rabbi drinks their blood.

Monday, June 21, 2010 11:04 am

Layin’ the smackdown on Alan Greenspan

Why do so many people think Alan Greenspan is a genius? Barry Ritholtz just doesn’t get it, and after reading him for several months, neither do I:

Former Fed Chair Alan Greenspan discussed the Federal deficit in a WSJ OpEd yesterday. In it, he argued that the budding “urgency to rein in budget deficits” is occurring “none too soon.”

Like most of the former Fed Chair’s analyses, forecasts, and economic beliefs, this one is pure, unmitigated nonsense. A brief look at the Greenspan legacy, along with his track record of forecasts, leads to the obvious conclusion: Greenspan is an economist to blithely ignore, as his commentary contains almost nothing of value other than its status as a contrary indicator.

Before we get into the details of his deficit commentary, I must highlight this sentence: “The financial crisis, triggered by the unexpected default of Lehman Brothers in September 2008, created a collapse in global demand that engendered a high degree of deflationary slack in our economy.”

No, Alan, the financial crisis was not triggered by Lehman’s collapse. You are getting the causation exactly backwards: The crisis is what triggered LEH’s collapse. Further, the fall of Lehman was hardly “unexpected.” Whether you want to look at stock price before the collapse, spreads on its debt, David Einhorn’s forensic accounting (he was short LEH) or our own quantitative analysis (we were short LEH), there were plenty of warnings about Lehman’s collapse. It was only unexpected by those whose ideological beliefs blinded them to reality. (Remind you of anyone?)

I am not particularly well-versed in economics — I’ve taken one course in my life — and yet I knew the economy in general and Lehman Bros. in particular were overextended even before Lehman failed. So how did this escape the notice of the Master of the Universe?

And this is not an isolated instance. Ritholtz actually makes a decent case that Greenspan is “the most incompetent economist of his generation” … which is saying something.

Thing is, there are still plenty of politicians in positions of power out there who will believe every word Alan Greenspan says because he tells them what they want to hear.

Wednesday, April 28, 2010 5:49 am

So nice they said it twice

Both Barry Ritholtz and Bill Fleckenstein think the SEC ought to sue not only Goldman Sachs but also the Financial Accounting Standards Board, whose accounting rule changes have so degraded accounting standards that companies, even publicly traded ones, essentially are bound by no rules. Want to know why Citi, Bank of America and probably Wells Fargo haven’t been taken over by the government even though they’re basically insolvent? Because the FASB is allowing them to carry loans on their books at roughly three times their probable market value.

Ritholtz:

As far as investors are concerned, (FASB has) have eliminated (standards). There is essentially no oversight of companies by accountants any longer. Accounting statements are all but worthless.  Frauds like Enron, Lehman Brothers and Overstock.com are everywhere. Companies can hide risk from investors, misstate earnings without fear of reprisal, engage in any manner of deceptive gamesmanship.

There are many reasons to buy various publicly traded companies — but what they report in their balance sheets ain’t one of them.

Fleckenstein:

The SEC also ought to consider pursuing the Financial Accounting Standards Board for helping denigrate accounting standards to the point that so much smoke and mirrors could pass for legitimacy.

Had real accounting standards been at work, they likely would have prevented the banksters from walking away with fortunes while they built financial instruments of mass destruction.

Wednesday, February 3, 2010 11:57 pm

Odds and ends for 2/3

Penn State “Climategate” scientist cleared of falsifying data: Three of four charges are dropped, including one claiming he destroyed e-mail; the investigating committee decides it isn’t competent to assess the fourth and punts to a different committee.

Eated: The FDIC closed six banks Friday, bringing the total for the month to 15. Six was the total for the month of January a year ago.

A cautionary note about the strong 4th quarter of GDP: Never, in 50+ years’ worth of data, has a quarter’s GDP growth of 5.7% coincided with a drop in private hours worked (-0.5%). Not sure what that means, but given that we know that productivity growth right now is being driven by layoffs, not capital investment or technological advances, and that 90% of that GDP growth was attributable to stimulus spending only, something’s fishy here.

Lessons from the AIG meltdown from one bureaucrat who sat at the table: I suspect that his conclusions are good because of, not in spite of, the fact that he worked for a state and not the feds.

Contributing factors vs. “but for” factors: Barry Ritholtz divides contributing factors from “but for” factors in deciding how much blame to apportion where for the economic crisis. What’s a “but for” factor? But for X, the crisis wouldn’t have happened. His three major but-for factors? “Ultra-low [interest] rates; unregulated, non-bank subprime lenders; ratings agencies slapping AAA on junk paper.” What about Fannie and Freddie? Contributors, yes, but not but-fors because they arrived so late to the subprime game.

MSNBC’s Dylan Ratigan carves the president a well-deserved new one. Perhaps he hasn’t heard what happened to Ashley Bancroft when she did the same to his predecessor. Who’s she, you ask? Indeed.

If the Democrats had the brains God gave a billy goat, this wouldn’t be happening, but Republican pollster Frank Luntz has laid out a strategy for Republicans to use in fighting financial reform, and I’m pretty sure that because of previous Democratic inaction, Luntz’s strategy will work.

David Rosenberg (via Zero Hedge) says this is all far from over: “We ran some simulations to see what would have happened in 2009 without all the massive amounts of fiscal and monetary stimulus. Instead of real GDP contracting 2.4% for all of 2009, it would have been close to a 4.0% decline. And, as for the last two ‘positive quarters’ — well, Q3 would have been -1.0% QoQ [quarter over quarter] at an annual rate and -1.5% for Q4 (as opposed to the +5.7% annualized print). Still no sign of organic private sector growth and here we have the Fed discussing exit strategies and the Obama team about to soak it to the rich (for anyone who makes over $250k). This is what is otherwise known as a ‘low quality’ recovery.” On the bright side, at least he puts paid to all this “The stimulus didn’t help!” nonsense.

James Fallows explains how circumstances now prevent the traditional conception of bipartisanship from functioning in American politics (at least in Congress). I understand all this — quite well, in fact. Indeed, millions and millions of ordinary Americans understand all this probably as well as Fallows does. The question is: Why is it that so many of the people whose job it is to understand this — David Broder, Chris Matthews, Maura Liaason, and I could go on and on and on — do not understand this? Relatedly, because they do not understand this, why do they still have jobs? Digby gets it: “Can anyone argue that the village just sees all electoral losses as a result of the losing party failing to be “centrist” and “bipartisan” enough?  It doesn’t matter what  the real factors are that drove the electorate.”

Way-cool animated model of the solar system: Go here for hours of family fun!

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