31 March 2008

How Barack Obama Blew the John Edwards Endorsement

I was reading an article discussing what it would take for Hillary Clinton to quit the race, and we had an interesting insight into how Barack Obama blew a possible Edwards endorsement:
In the days after John Edwards’s withdrawal from the Democratic race, the political world expected his endorsement of Barack Obama would be forthcoming tout de suite. The neo-populist and the hopemonger had spent months tag-teaming Hillary Clinton, pillorying her as a creature of the status quo, not a champion of the kind of “big change” they both deem essential. So appalled was Edwards at Clinton’s gaudy corporatism—her defense of the role of lobbyists, her suckling at the teats of the pharmaceutical and defense industries—that he’d essentially called her corrupt. And then, not least, there were the sentiments of his wife. “Elizabeth hasn’t always been crazy about Mrs. Clinton” is how an Edwards insider puts it; a less delicate member of HRC’s circle says, “Elizabeth hates her guts.”

But now two months have passed since Edwards dropped out—tempus fugit!—and still no endorsement. Why? According to a Democratic strategist unaligned with any campaign but with knowledge of the situation gleaned from all three camps, the answer is simple: Obama blew it. Speaking to Edwards on the day he exited the race, Obama came across as glib and aloof. His response to Edwards’s imprecations that he make poverty a central part of his agenda was shallow, perfunctory, pat. Clinton, by contrast, engaged Edwards in a lengthy policy discussion. Her affect was solicitous and respectful. When Clinton met Edwards face-to-face in North Carolina ten days later, her approach continued to impress; she even made headway with Elizabeth. Whereas in his Edwards sit-down, Obama dug himself in deeper, getting into a fight with Elizabeth about health care, insisting that his plan is universal (a position she considers a crock), high-handedly criticizing Clinton’s plan (and by extension Edwards’s) for its insurance mandate.
I will say that this plays into the worst perceptions of Obama, as someone who is far too fond of himself and far too confident in his charm to get people to do what he wants.

You have to be an egotist in order to run a real campaign for President, but the thing that has always disturbed me about Obama is the sense that he thinks that he is so personally awesome, and when he threw gays under the bus in South Carolina, I was wondering who is next.

At this point, I think that it is every major Democratic constituency, because he wants to show that he can reach across the aisle.


While campaigning in Pennsylvania, Barack Obama bowled a game.

His score was 37.

I have bowled perhaps 6 times in my life. I think that my best score ever was about 103. I really suck at bowling.

That being said, I could not be drunk enough to bowl a 37.


Bush - Dilbert


Go Read his riff.

BTW, Richard Band Is a Moron

Reference my previous post.

In any case Richard Band, publisher of a well respected Wall St Newsletter is saying that the Dow will hit 16,000 by late 2008 or early 2009.

Dow 36,000 writ small, I guess, because the only way I see it hitting that number that soon (a 33% appreciation) is inflation hits 50%.

I dunno, maybe he's banking on some sort of Bush is not the President rally, but this still makes him stupid.

18%??? Eighteen F%$@ing Percent???

Thornburg Mortgage's bond sale at 12% just failed, so now they are trying to sell bonds to stay solvent at an interest rate of eighteen percent.

They could not get buyers at 12% and they are trying to sell bonds at 18%???

The people who think that this is going to get better soon are morons.

Merkel Will Boycott Beijing Olympics

Sarkosy is considering, and Tusk of Poland and Klaus of the Czech Republic have said that they will boycott too.

The Chinese had no bloody clue what they were getting into when they won the Olympics.

First Up Against the Wall When the Revolution Comes

Top Countrywide Financial Executives Will get Millions in Bonuses.

Quote of the Day

Some Guy With a Website:
There is not a single instance of political discourse in the history of this nation in which the participants did not want to simply kick their opponent in the balls.

More Iraq

Busy past few days.

Basically, even though undoubtedly better equipped, and possibly better trained, the Iraqi Army and Police are getting their asses handed to them, because they are completely unmotivated. Unlike the Hakeem family, the army and police really don't like fighting for the idea of greater Iranian hegemony in Iraq, which is clearly the goal of the current government.

Sadr is the only major Shia player who isn't in the Iranian's pockets, but he's the one we are targeting air strikes at.

In any case, after some It appears thatfits and starts, negotiations finally got underway, with an Iranian general brokering the cease fire which is not in effect, if only barely (see here, here, and

If you are wondering who won this, just reflect on Sadr's terms for a truce, release of all Sadrists not convicted of crimes, and amnesty for members of the Mahdi militia.

This is a victory for him, and for Iran.

California Eschews Bond Insurers

It's interesting how often financial reporters miss the forest for the trees.

Case in point, we have California Treasurer Lockyer telling Warren Buffet's new bond insurance business to go pound sand.

The core of the dispute is that bond ratings agencies have low rated municipal debt as compared to commercial debt for years.

This has meant that entities like the state of California have had to buy bond insurance to get AAA rates, despite the fact that the risk of default is negligible:
"We're selling water in a desert; we should be rated to reflect that," said Cary Casey, who oversees bonds at the Southern Nevada Water Authority in Las Vegas that have a AA+ rating from Standard & Poor's. Casey said he's not interested in Buffett's insurance. "He's no savior."

The first municipal bond insurance policy was sold in 1971 by Ambac. The near bankruptcy of New York City in 1975 bolstered demand for the industry, said Richard Larkin, research director at brokerage Herbert J. Sims & Co. in Iselin, New Jersey, and a former chief municipal rating officer at S&P.

New York City creditors were paid in full. When Orange County, California, filed the largest municipal bankruptcy in 1994, only one issue defaulted and no principal or interest payments were missed, according to Moody's.

"The legalized extortion has been going on since before I became mayor of Somerville in 1990," said U.S. Representative Michael Capuano, a Massachusetts Democrat on the House Financial Services Committee. Capuano said he was forced to buy bond insurance, even though his town of 80,000 had never defaulted and the state provided backup guarantees.
Emphasis mine.

Bond insurance to municipalities have been a protection racket for years, and not it turns out that the insurers, not the municipalities, are the ones with the problem.

I think that as we tease out the credit collapse, we will find many more examples of systemic corruption and extortion by Wall Street firms.

The FSM may be wrong, these guys are pirates, and global warming proceeds unabated.

Zimbabwe Elections

The opposition is claiming victory, but results are coming out very slowly, so my guess is that there will be significant vote fraud.

787 Partners Reorganizaton

One of the central "innovations" of Boeing's 787 plan was the idea of bringing in suppliers in as fully involved partners, where they would bear much of the risk, and be responsible for much of the design and engineering.

Recent developments appear to indicate that Boeing is walking away from this policy.

Boeing has just bought out Vought Aircraft's ownership stake in Global Aeronautica, which means that Boeing and Alenia now each own half of the enterprise.

Vought will still be a supplier for the 787, particularly the aft fuselage, but their more senior role in design and engineering has been taken over by Boeing.

I expect to see more in the way of recentralization by Boeing on the 787 to come, with yet more on their next project, a replacement for the venerable 737.

Full disclosure, the CEO of Vought Aircraft, Elmer Doty, was head of my division* when I worked at United Defense/BAE Systems.

*Yes, I have worked everywhere. Maybe I can't hold down a job, but more likely this has been my role as "technical hit man", where you are parachuted in to take care of a specific need.

Good Politics, Good Policy on Iraq

42 Democrats are promising to submit legislation for an immediate withdrawal from Iraq if elected.

At least one of the 42, Donna Edwards, is pretty much already in, as she defeated the incumbent in the primary, and it's one of the safest Dem seats in the country.\

What needs to be done is to lean on the Bush Blue Dog Democrats.

If we see a few more "Mini-Tets" in Iraq, which I think is likely, then more people will sign on to something like this.

30 March 2008

Clinton Promises to Stay in Race

I honestly think that she really believes, and this is what is leaking out from her advisers, that Barack Obama is dead meat on the table in November.

I disagree, it does explain what she said in this interview.

Torture Tapes Destruction May Prevent Fair Trials

While I'm sure that Bush and His Evil Minions think that fair trials, much like military service, are for losers, it comes as no surprise that the torture and subsequent destruction of the torture tapes is making holding something resembling a fair trial difficult.

We can't have kangaroo courts if we expect anything but a further souring of our already toxic relations with the rest of the world, but after an orgy of law breaking and ass covering by people working in our name, it looks like kangaroo courts is all we got.


The Unsinkable BUFF

It appears that the USAF is looking to change its draw down on B-52s, with 76, as opposed to 56.

Their justification is that they want some of the B-52s dedicated to nuclear strike, as opposed to swapping squadrons in and out of the service, on the theory that they won't do stupid stuff like sending detonators to Taiwan, or flying live missiles by mistake.

Once again, the BUFF (Big Ugly Fat F&^%er) is being tasked to pull the Air Force brass's ass out of a fire.

Kenyan Dispute Still Not Resolved

President Mwai Kibaki and PM Raila Odingaappear to be having significant problems resolving the composition of the cabinet.

I haven't followed this closely, quite honestly Africa is pretty much off of my radar, but to the degree that I have, it's painfully clear that Kibaki stole the election, and that he is being given a bit of a pass by outside powers, because he is seen as being "good for business."

The impetus here should be for an arrangement that respects the will of the people as it was actually expressed at the ballot box, and to the degree that Kibaki is backing away from these agreements, it should be made clear that this is not acceptable.

U.S. F*^%ing It Up In Pakistan

First, we enthusiastically back and fund a not-particularly-competent military leader, who spends most of the money we send him on a potential war with India, and now we send "Mr. Death Squad" to lean on a not yet formed opposition government to be more proactive, all while continuing unilateral air strikes in populated areas.

Some selected quotes from the article below:

The meeting with Nawaz Sharif, .... have failed entirely. Sharif said that Pakistan would no longer be a "killing field" where other countries pursue their own interests.


[with tribal elders] "We told them that whatever differences we have (with the extremists), they can all be solved through the jirga system," said Malik Darya Khan, one of the tribal chiefs who participated, referring to the traditional meetings of elders to solve disputes.

There also appeared to be an open dispute between Sharif and U.S. officials on how to deal with Musharraf. Sharif said afterward: "We don't recognize him as the legitimate president."

Dawn newspaper, in an editorial on Thursday, described the arrival of the two U.S. envoys as "indecent haste." It added: "It is time Washington gave the new government time to settle down."

"Bad timing gives the wrong signals, as if they are trying to pressurize the new government when it is in the stages of being formed," said Shireen Mazari, the director general of Institute of Strategic Studies in Islamabad.

"The war on terror has be to revisited. The most dangerous thing is that the Americans have succeeded in shifting the center of gravity of the war to Pakistan. We have to shift it back to Afghanistan," Mazari said.

Pakistani concerns about U.S. activity have been ignited over the last month by a series of apparent American missile attacks on targets in Pakistan. The news that the former commander of the Guantanamo Bay, Cuba, detention camp, where hundreds of Muslim prisoners, many of them Pakistanis, have been held without charge, has been appointed the chief U.S. defense representative in Pakistan isn't likely to help relations.
Seriously, they could not screw this up more if they tried.

28 March 2008

Hillary Says, "Don't Vote for McCain"

Good for her.

I've always said that no one in their right mind would vote for the sick old man, but "no one in their right mind" constitutes only something like 30% of the electorate.

Waiting for a similar statement from Obama, who was the first one to say that his supporters would not vote for Hillary in the general.

Economics Update

In honor of March Madness:

Click image for source

You may recall that Monoliner insurer FGIC having problems. Now it is saying that was saying that it would not honor its insurance contract withCredit Agricole SA and IKB Deutsche Industriebank, because they deceived the insurers about their financial health.

Seeing as how IKB seems to be facing villagers with torches, this may very well be true.

It's in court.

And of course, because it's a day of the week ending with "y", the Federal Reserve is giving away another $100 billion to the banks.

No wonder noted bear, and Oppenheimer analyst Meredith Whitney is predicting that Citi will be cutting its dividend again soon.

In economic matters for the rest of us, personal income did better than expected, but personal spending remained weak, and the head of Freddie Mac is saying that he does not expect recovery in house prices until 2010.

I say that he is an optimist. The regional crashes we have seen, which have been much less severe, have all lasted at least 5 years, which puts the date at 2012, though I would take 2015 in the over/under in non-inflation adjusted dollar terms.

I don't think that we will be back to the 2006 highs adjusted for inflation in my lifetime.

And in the world of collapsing economic institutions, we have former sub-prime lender Fremont General ordered to find a buyer by the FDIC, in addition to restricting interest it can pay to depositors, payments to senior executives, and transfers to its parent company.

This does make the fact that the Office of Federal Housing Enterprise Oversight has told Fannie Mae and Freddie Mac that they are free to raise another $20 billion a bit nonsensical.

The taxpayers will end up on the hook for all of this.


It appears that Barack Obama has just said that if Reverend Wright had not retired, he would have left the church.

Stupid move. Barack Obama just bitch slapped himself in an effort to separate himself from the man who married him and baptized his daughters.

This is wrong, we can disagree with people we love, and it's stupid, because it plays right into Josh Marshall's Bitch Slap Theory of Politics, where by not defending themselves, and in this case people who are near family, they make voters wonder if they will stand up for them.

This is stupid. It makes him look weak, and folks that he is reaching out to will never vote for a black man.

Wanker of the Day: Michael Kinsley

He seems to be a wanker every time he writes.

In this case, he generates a 822 words on musing on how long Hillary Clinton spends putting on clothes and makeup each day.

By Yog Sothoth's Yellow Yogurt, this is unbelievably wankeriffic.

We Have Reached the Tipping Point on the Dollar

Small local money changers in Holland are refusing to exchange the dollar, since they don't typically exchange money back to Euros at the close of business each day, they think that the risk of a significant loss is too great.

And the South Korean pension fund that I mentioned yesterday are part of a trend which will likely see the end of the US dollar as the major reserve currency sooner than most people expect.

Mess-O-Potamia (Iraq Update)

Yes, I stole the hed from TDS.

First, it appears that the Iraqi security forces are giving Fatah a run for their money as the worst military in the world, see here, here, and here.

Much of this is about the fact that many in the security forces are deserting and joining the Mahdi army. Truth be told, many were already members of the Mahdi army.

As a result, Maliki is extending his so-called ultimatum to disarm, because everyone is laughing so hard at him.

As a result, the US military is being sucked into the fighting.

UK forces are not deploying to Basra, and have made it clear that they will not be doing so.

I guess it's a bonus for getting rid of the Poodle.

More tanker

Both the USAF and Northrop Grumman are requesting that the Boeing Challenge be rejected, see here, here, and here.

Of more import is the fact that the UK just signed a contract for $13 billion for A330 tankers. Note that the contract is different, as it is to replace the RAF's Lockheed TriStar and Vickers VC10s, and the former are large, as opposed to medium tankers, but it points to a trend.

I think that Boeing is out of the tanker business for the next 10 years, until the money is found to replace the KC-10 tankers.

Fun in Canada

Well, it appears that the investigation of the Harper government's leak of conversations between Austan Goolsbee and the Canadian Ambassador will be made public.

It probably won't be pretty for Harper and his cronies.

Could a Canuck out there explain why the opposition is not trying for a no-confidence vote?

Incompetents Abroad

Pakistan's new coalition government is saying that it objects to what it considers the reckless and excessive air strikes of the US in Pakistan.

It's clear that Musharraf is on the way out, and that this is the policy of the government, so what is the response of the US Military? They accelerate their bombing, because we need to get those last few licks in before the end of Musharraf actually become official.

Does anyone in the White House or Pentagon have a clue as to how damaging this behavior is?

More importantly, does anyone in the White House or Pentagon have any clue about anything period.

Will KPMG go Arthur Anderson?

It now appears that KPMG systematically helped New Century Financial, a mortgage lender, conceal its financial troubles.
New Century Financial, whose failure just a year ago came at the start of the credit crisis, engaged in “significant improper and imprudent practices” that were condoned and enabled by auditors at the accounting firm KPMG, according to an independent report commissioned by the Justice Department.
This is what killed Arthur Anderson.

The specifics:
  • KPMG auditors raised red flags, but KPMG partners rejected them because they, "feared losing a client."
  • The accounting changes converted a loss ot a profit in the 2nd half of 2006.
  • These "profits" meant large executive bonuses
  • They also misled Wall Street about the status of the company and artificially inflated the stock price.
FWIW, I disagreed with the Supreme Court decision exonerating Arthur Anderson.

The only we get honest audits is if there is a threat of a corporate death penalty hanging over these folks heads.

We Sent Nuclear Missile Parts to Taiwan?

It appears that batteries were mistaken for missile fuses.

Well that cinches it for me, Homer Simpson and George W. Bush are the same people.

Think about it. You've never seen them together at the same place and the same time.

Also, look at the Simpsons episode with George H.W. Bush....That hatred is Oedipal.

Navy Says JSF Costs Under Control

In related news, the Navy also says that, the check is in the mail, this will hurt me more than it hurts you, and that it won't come in your mouth.

I believe that the organization whose latest destroyer's price has escalated to a number larger than that of the GDP of Zimbabwe when they say that the costs of the naval version of the JSF are under control.

This has disaster written all over it.

Iraq Update

First, we must mention that Tahsin al-Sheikhly, a spokesman for the Iraqi government's security forces has been kidnapped by elements of the Mahdi Army (See here and here).

It makes one wonder if Maliki's really the head of the Iraqi government, or a very subtle sketch comedy troupe.

The fighting continues, and we are seeing large protests in Baghdad over this.

It's increasingly clear that Cheney wanted provincial elections to go forward, and signed off on operations against the Mahdi Army to do this, not because they would prevent elections, but because Maliki wants to take them out to prevent Sadr's party from making political gains in the elections.

Of course, Maliki is vowing "no retreat" on the operations, but if this ends with a cease fire, he's done, so it's not like he has an alternative.

In the mean time, the Maliki forces are not doing well, and it appears that US Armored forces are now actively involved. The Iraqi army is not, as they say, "standing up".

Finally, on the real reason that we are there, oil, we are seeing oil price spikes on pipeline sabotage.

France to Cut Nuclear Arsenal

This is something that we should be doing too. Sarkosy has announced that the French nuclear arsenal will be cut to less than 300, about half of what it was at its peak.

This is a good step for everyone. Currently, according to the wiki, "[the USA] maintains a current arsenal of around 9,960 intact warheads, of which 5,735 are considered active or operational".

I see no reason that we could not drop down to below 1000 operational warheads.

Zumwalt in Trouble

The DDG-1000 class ships are losing Congressional support, with Rep. Murtha proposing that they be delayed for other needs.

There were originally supposed to be 24 of these, then 7, and now 2, and they are being delayed, and the price has gone through the roof, with it now being quoted at $3 billion each, with realistic estimates putting it at $5 billion.

It's a bad program. 80%+ of any surface combatant's benefits are simply a product of their being afloat and available, so going with what are very large boats and fewer numbers gets fewer boats in the water, and this does is not outweighed by the additional capabilities of the larger boats.

The problem is that the US Navy has a fixation on size.

Retaliatory Downgrades, or Wall Street as Sketch Comedy

It appears that in response to JP Morgan and UBS cutting earnings estimates on Merrill Lynch, Merrill Lynch has cut its ratings on Bank of America, PNC, and SunTrust.

At least that's how I read the article....Weird Kabuki dance this.

Economics Update

South Korea’s National Pension Service will no longer invest in US Treasuries. They are saying that the rates of return are too low.

Note that this is the 5th largest pension fund in the world, so this is a decision with consequences.

I have noted on a number of occasions that the Fed would find itself torn between keeping the economy afloat, and keeping the dollar strong, and this is the first leak in the dam.

This does not necessarily mean that they won't be investing in the US though. While the rates treasuries are low, other interest rates are rising, with the London interbank offered rate (LIBOR) up about 1%. Mortgage rates are also not responding to Fed Rate cuts.

Search for the term "pushing on a string" in my archives. It's a quote from Keynes.

The weekly jobless claims numbers are less than were expected, which is good news, but there is a lot of noise week to week, so I'm more concerned about Commerce Department's final GDP numbers, which show the inflation adjusted growth of the GDP being 0.6% annually.

Additionally, investors initial reaction was to flee long term treasuries following the unemployment numbers, which implies an expectation of increasing inflation.

In terms of the market recovering trust, not so much, with asset backed commercial paper, short term asset backed debt, falling. There are no buyers for it.

Finally, Merrill will write down $4.5 billion on CDOs (collateralized debt obligations), and post a loss in Q1.

Al Wynn to Resign

Wynn is retiring, effective June.

Nominally, the reason given is that he wants to give Edwards a leg up on the general, that she does not need, but I don't buy that.

My guess is that either he wants to get a running start on his lucrative lobbying gig, or he is doing this as a way to shaft either Donna Edwards or his constituents.

My suggestion would for O'Malley to call a special election on the same day as the general. That way Edwards has a seniority edge on the rest of the 2009 Freshman class.

27 March 2008

Siegelman Released by Appellate Court, Will Appear Before Congress

The Appeals court has ordered former Alabama Governor Don Siegelman released from prison pending his appeal. They overturned the ruling of his judge at trial, Mark E. Fuller, who is also a political foe of the former governor.

He's been in custody for some time, one of the reasons that Judge Fuller has dragged his feet on releasing the transcript, without which you can't even start filing an appeal.

Also, the House Judiciary Committee is requesting his testimony.

Guns for What?????????

India is now giving firearms permits to men who get vasectomies.
A scheme that trades one male status symbol for another has achieved a large rise in the number of men undergoing vasectomies in a bandit-ridden region of central India.

Shivpuri district in the state of Madhya Pradesh, an overpopulated area renowned for its machismo culture, has started to offer fast-tracked gun licences for those who agree to be sterilised.
There has to be a crude joke here, but I'm not seeing it.

Remember, Stocks are Always the Best Long Term Investment

Except, of course when they are not, as has been the case in what the Wall Street Journal so evocatively calls the Lost Decade, where stocks have provided no return over the past decade.

This is not surprising, seeing as how we are coming off a bubble, tech stocks segueing into real estate, and this is when stocks don't do well.

Dean Baker asks the question the WSJ won't, "What if your social security was invested in this?

The answer is that we, and our parents and grand parents, would be completely screwed.

E.U. Considers Olympic Opening Ceremonies Boycott

As a tactic the boycott sounds lame, until one considers the alternatives.

Still, the Chinese wanted have the opportunity to be the center of world attention by hosting the Olympics, and it seems that they will get that.

My heart bleeds borscht for them.

We're All Gonna Die

Uh-oh.....a chunk of ice about 7 times the size of Manhattan just detached from the Wilkins Ice Shelf in Antarctica.

I think that we are heading down a steepening slope, and I would not be at all surprised if there is blue water between the three islands that make up Greenland (they currently share an ice field) in my lifetime.

GOP State Parties in Disarray

We have lack of money, an orgy of back biting, and general disaffection of the true believers at the state level as well as at the federal level.

Pass the popcorn.

Neat Tech: Satellite Swarms

Basically, as opposed to launching one big satellite, like the one that the navy had to shoot down, you launch fractionated satellites, basically a cluster that orbit close to one another, and together provide the capabilities of a single larger satellite.

It means that a launch or satellite failure won't remove the capability, though it may reduce performance somewhat.

The program is from DARPA, and it's called "System F6" (future, flexible, fast, fractionated, free-flying spacecraft united by information exchange).

McCain Clueless on Financial Crisis

He's saying that, "leavint the door open", but that really means that he doesn't know what to do.

Not surprising, since his number one and two economic buddies are Alan Greenspan, whom McCain once famously said that if he died, he put sun glasses on him and do the Weekend and Bernie's thing, and Phil Gramm, who spent his career making wall street safe for scam artists.

They are numbers one and two on the "who f%&$ed Wall Street up" hit parade.

Scare Quotes of the Day

Courtesy of that communist rag, the Financial times of London, where they ask Why we should fear a McCain presidency?
It may seem incredible to say this, given past experience, but a few years from now Europe and the world could be looking back at the Bush administration with nostalgia. This possibility will arise if the US elects Senator John McCain as president in November.
Emphasis mine.

Of course, this quote is no where near as disturbing as Harold Meyerson's in the Washington Post:
It is 3 a.m., and the stillness of the White House night is shattered by the ringing of the red phone. President John McCain, rousing himself from a deep sleep, turns on the light and picks up the receiver. A U.S. embassy in a Middle Eastern country, he is told, has been blown up, and al-Qaeda is taking credit.

McCain takes a deep breath. "Character counts, my friend," he says. "Bomb Iran. Bomb, bomb Iran."

There is a rustling of blankets, and, brushing aside Cindy McCain, a concerned Joe Lieberman rises from the bed. "Not Iran, Mr. President," he says. "They hate al-Qaeda."

"That's right," the president says. "I remember now." He sighs with relief. "Good thing you're here every night, Joe."

But suppose, dear reader, that John McCain becomes president and Joe Lieberman doesn't bunk with the McCains on a nightly basis. How easily should the rest of us sleep? It's anything but an academic question after McCain's bizarre performance in Jordan last week.
As disturbing as the last image is, it's clear that McCain's solution to anything short of unstopping a toilet is to launch a military strike.

Military strikes against the DPRK and Iran would be almost certain, and I'd offer even money for shooting between Russia or China and the US.

Stealth Costs of F-22 Exceed Estimate

Bill Sweetman notices a USAF document touting improvements in the cost and maintainability of stealth operations for the F-22, and notes that they have still not achieved what was promised about 8 years ago, even with the improvements.

While the Air Force is hailing efficiency gains, it appears that maintaining the LO capabilities of the Raptor are a crushing burden.

More Toxic Exports

We are not talking Chinese toys, or Mexican lettuce, we are talking about "Anglo-Saxon" financial products.

Increasingly the rest of the world is looking at the US and UK system of regulation, more accurately a system of no regulation, and seeing the downside, and becomind disenchanted with the US-UK model.

Henry Farrel cites articles by Wolfgang Münchau, and Steve Clemons about the change in attitude.

They both make the point that this is an ongoing, and IMHO accelerating, loss of power for the US, though Münchau is rather more stark, first because he has been an unabashed fan of what I call US style klepto-capitalism, but also because of his the points that me makes:
  • The Euro would replace the dollar as the world’s largest reserve currency within the next 10 or 15 years. (I rather believe that it will be in 5-10 years, but I'm not an economist)
  • If yours is a global reserve currency today, it is likely to be one tomorrow too. But this works only up to a point – a tipping point.
  • But the Euro is a real alternative. [to the dollar as a reserve currency]
  • This has been a crisis of Anglo-Saxon transaction-based capitalism.
  • Losing the dollar as the world’s leading international currency not only leads to a loss of political power. It constitutes loss of power.
What happens when your bank starts demanding Euro denominated mortgages?

D.B. Cooper Update

It looks like they have found a buried parachute in Southwest Washington state, and the FBI is investigating.

I went to high school in the Pacific Northwest, and like most people from Oregon and Washington, there is a bit of interest there.

ISO Looks to Reject OOXML Again

Mouthful, huh?

The short version is that the International Standards Organisation (ISO) and the International Electrotechnical Commission (IEC) are having a vote as to whether to adopt Microsoft's Microsoft’s Office Open XML (OOXML) format for its office suite as a formal standard, and Cuba and India just voted no.

Microsoft had this voted down before, largely because there already is an ISO standard format out there, Open Dcument Format (ODF).

Microsoft, of course, uses OOXML, which is a proprietary format, notwithstanding its name, but with increasing numbers of users, particularly in government, demanding open formats to prevent vendor lock in, they want to be adopted as a "standard".

Microsoft's whole business model, of course, is vendor lock in.

Furthermore, as is made clear here, OOXML was written around the specific internals of Microsoft products:

Here is the Microflaccid office way of making text red:
Word: <w:color w:val="FF0000"/>
Excel: <color rgb="FFFF0000"/>
Powerpoint: <a:srgbClr val="FF0000"/>

Here is a standards compliant way.
ODF text: <style:text-properties fo:color="#FF0000"/>
ODF sheet: <style:text-properties fo:color="#FF0000"/>
ODF presentation: <style:text-properties fo:color="#FF0000"/>

Why Yes, I did Work on This!

I came across this article on the USMC putting prognostics on its vehicles, and it turns oout that it's yet another field of study that I've applied my engineering skills to.

Specifically the Marines are installing the Embedded Platform Logistics System (EPLS), which works by determining the actual condition of the equipment, as opposed to implementing a fixed maintenance/replacement schedule by using sensors on the equipment and computer algorithms to determine when components are wearing out.

When I was working on the Advanced Amphibious Assault Vehicle (AAAV), now called the Expeditionary Fighting Vehicle (EFV), it was primarily on a prognostics demonstration for the landing craft.

It was a nice job, with a nice boss (Hi Dave), but it was the commute from hell (75 miles through the heart of DC), and the scope of the program was being increasingly reduced, and I figured that it was not too long before I would be de-scoped, so I found something with what was then United Defense.

Parents Putting Children, and the Community at Risk

The facts are quite clear, there is no tie between vaccines and Autism*, and this has been conclusively proven.

The doctor who came up with this cockamamie theory had his ticket yanked. The removal of Thimerisol (which was an independent good regardless of the non link to Autism) made no difference in the trajectory of the disease.

Vaccines represent the greatest success in public health in the history of...well..history.

When we see reports like this one the Neanderthal anti-vaccination movement, the basic points which need to be made are as follows:
  • There is no evidence that vaccines are listed are linked to any disease.
  • The idea that there is a link to Autism is false and has been completely disproven.
  • This puts the entire community at risk, because unvaccinated children spread the disease.
  • It puts holes in herd immunity.
These basic points were not made in this article, though it was hinted at when the writer quoted Sybil "I'm a Moron" Carlson saying that vaccines caused "immunology".

Let's be clear. Vaccines do have risks, I know someone who is in a wheelchair because of a vaccine induced case of polio, and my mother had an allergic reaction to the horse serum used in the tetanus vaccine, but they are less than that of not being vaccinated, and they are acute, not chronic.

The anti-vaccine movement is based on two things, stupidity and ignorance involving the science, and a blithe disregard for for the effects of society.

That's why we are getting outbreaks of measles, mumps, whooping cough. Because these people are creating reservoirs of disease out of their children, and it affects the vaccinated too, because no vaccine is 100%, and some vaccinated children are put at risk.

*Full disclosure, my son is on the spectrum, diagnosed with Aspergers.
In deference to the GEICO cavemen, I wish to apoliogize for any offense to true Neanderthals.

26 March 2008

Tet in Iraq Update

Well, when we look at the straight news stories, we have the New York Times saying that the, "Iraqi Crackdown on Shiite Forces Sets Off Fighting", and CNN Reporting that Maliki is offering an "Ultimatum" (AFP says the same.)

There are two possibilities here:
  1. Maliki wants to take out a more political opponent before the provincial elections.
  2. The US Military demanded this, because they want to show "Iraqi military progress" for the upcoming congressional hearings.
My money is on the second. Even a hack like Petraeus knows that the Iraqi military is not ready for this.

Additionally, the reports that Maliki is "personally supervising" the operations in Basra, seems to indicate a ploy by Maliki, not by the members of the Bush military-political complex/

Spencer Ackerman makes a very good point when he says that the US role in all of this is that of a hostage:
As long as Maliki is in the prime minister's chair, and as long as we proclaim the Iraqi government he leads to be legitimate, Maliki effectively holds us hostage.
Eric Martin asks if Bush and His Evil Minions are backing the wrong horse.

I agree with his concerns. While Sadr is looking for a stricter theocracy, he is the most outspoken Shiite Iraqi nationalist in the game, while the other two main Shiite factions, (ISCI/SCIRI and Dawa) are firmly committed to Iran, possibly near-puppets of Iran.

The reason that the US does not make nice with Sadr is because he opposed to the US's Iraq forever plan, which Bush is irrevocably committed to.

Finally, Matthew Yglesias makes a very good point about the nature of imperialism:
The would-be imperial power has to back the 'less popular local elements.' The key thing is to find groups that are strong enough to hold on to power with external support, but too weak to come to be in a position to kick the ladder of external support away.
Any politician in Iraq who could become popular enough to have a meaningful and independent power base is a threat to the US presence there, and thus will be opposed by the US.

Economics Update

The first two bits are easy to understand, New home sales are the lowest since 1995, which matches with the horrid existing home sales data that I posted yeaterday, and Factory orders fell off a cliff in February.

First, things are simply getting even weirder in the never-dull world of monoliner insurers, with the Federal Home Loan Banking looking at offering bond insurance for municipal infrastructure project bonds.

It's a dull, but very profitable racket, because there has been some sort of freaky deal between the monoliners and the rating agencies for years that has them offering artificially low ratings to muni bonds, which pretty much forces said governmental agencies to buy bond insurance.

If it works, it kills the monoliners, because this business is the only thing keeping them afloat on a sea of collateralized debt obligations (CDO).

Additionally, we have monoliner insurer FGIC notifying regulators that due to some "dodgy" dept that it is ensuring, that it is insolvent under New York State law, "FGIC in notes to its consolidated financial statements said it plans to submit a plan to the New York superintendent to reduce its risk. FGIC also said it has voluntarily ceased writing new business to preserve capital."

This means that, theoretically at least, regulators could seize the FGIC, though they are in litigation with the borrower of the aforementioned debt, and they are filing a recovery plan.

Tonya Harding Option? I Call Bull$#@&!

So we have Jake Tapper of ABC News reporting that a "Democratic Party official, who asked for anonymity", which could be anyone from Howard Dean to the guy who gets the coffee, saying, "Her securing the nomination is certainly possible - but it will require exercising the 'Tonya Harding option.'" and then adding "Is that really what we Democrats want?"

While I appreciate Tapper's skills in parlaying a couple of dates with Monica Lewinski into a heavy duty "reporting" gig, first with Salon, and then with better paying media, he's a still a wanker.

He spent all of 2000 hating on Al Gore, because he missed a flight because they did not hold the press plane for him.

First, if this were someone senior, say someone of my generation (I'm 45) or older, they would not use this term.

Second, he didn't use the term "senior", which he would have used if it were defensible.

Furthermore, notwithstanding the use of the quote by some of the hyperventilating elements of the blogosphere, what we have here is someone, and someone not particularly senior saying what has been the standard line for places like MSNBC for some time: that Hillary Clinton is "destroying the party".

A lot of people are hyperventilating about a story with no "there" there, which I'm sure tickles Mr. Tapper no end.

Social Security Numbers Actually Getting Better

Paul Kurgman notes that the actuarial numbers for Social are better now than they were 15 years ago.

And that's with the Social Security board being populated by Bush's Evil Minions&trade, who are being as alarmist as they can.

Great Prank

This is a great way to protest, and an inspired prank, and I approve of this message.
Root beer keg party doesn't amuse officials

By Brian Reisinger
Wausau Daily Herald

The Zebro home in Kronenwetter showed all the signs of an underage drinking party March 1: cars blocking the road, dozens of rowdy kids and a keg.

And yet, every partyer's breath test revealed an alcohol-free gathering.

Dustin Zebro, 18, and his friends said they threw the party after D.C. Everest High School administrators suspended their friends from sports.


Forest Service May Move From AG to Interior

Personally, I like the idea of moving the National Forests, but there may be issues with cultures.

The Forest Service is has very much the culture of the AG department, profits through harvest, with the National Forests having as their de facto primary purpose providing wood for the timber industry, and the Interior Department is about preservation of special places as an independent good.

To the degree that the Forest Service ends up more like the Park Service, that will be a good thing.

The Case for Partisanship

Matthew Yglesias, who I think is sometimes contrarian for its own sake, nonetheless nails it in this essay.

The best point for me is here:
For veteran Washington hands—wheelers and dealers in the lobbying game or at the major interest groups—the new system is worse than dull. It’s emasculating. This is why political elites find polarization so distasteful. In a polarized world, elections and procedural rules largely determine policy outcomes; there’s little room for self-styled players to construct coalitions on the fly, and enhance their own power in the process. The growth in the lobbying industry might seem to belie the point, but consider Tom DeLay’s post-1994 “K Street Project”—which pressured lobbying firms who wanted access on the Hill to hire more Republicans—or the swing of the pendulum back after the Democratic takeover in 2006. Power in Congress is firmly in the hands of the party leadership; lobbyists become less powerful, not more, in a polarized system.
The fact is that outside of the beltway, no one really cares what David Broder thinks, or what gets said at Sally Quinn's parties, and if you have a political system in which party affiliation actually means something, neither do the members of Congress or the Executive branch.

They answer to the voters under those circumstances.

The Sacrifices We Must All Make in War

H/t Atrios

The KC-X Tanker, The Musical

It appears that we've got our first astroturf, Tankerblog.com, which has been anonymously registered, where they brethlessly reveal that A330 tanker cannot refuel the V-22, while the 767 could.

The blog describes itself as, "The blog is moderated by Mike Reilly who spends his days at the Center for Security Policy and a bipartisan group of legislative assistants who spend their days, and most nights, working on Capitol Hill."

These "staffers" are from the Seattle no doubt, and the CSP has among it members, Richard Perle, Douglas J. Feith, , Frank Gaffney - Project for the New American Century, Monica Crowley and , Laura Ingraham. (You can get a line on their right wing nut supporters here)

No reasons given for why the difference, and in the real world, if refueling were needed it would be done by a KC-130 turboprop, since using a jet to refuel a turboprop that has to operate below 15k feet because it is not pressurized is just nuts.

A bit of humor at this "blog" though, they have a poll on whether congress should stop the deal, and the pro EADS sides in winning.Tanker War Blog, unnamed bipartasin staffers in congress, from Washington state, no doubt. http://tankerblog.blogspot.com/ look at their poll...good yucks.

The kicker is that Northrop Grumman says it can refuel the V-22, "said on Monday its aerial tanker based on the Airbus A330 could refuel the V-22 tilt-rotor aircraft flown by the Marine Corps."

Nice to see some defense procurement related humor.

In the meantime, we are starting to see people worrying that Congress will go xenophobic, and queer the contract which would threaten weapons sales in Europe. *cough* JSF *cough*

As to what Boeing is arguing about, it appears that a lot of this is the spacing between wingtips while parked. The USAF reduced this on the basis of what had actually observed.

Additionally, Boeing complained that the Combined Mating and Ranging Planning System (Cmarps) system which was used to develop operational scenarios for the bidding, was something that NG was more familiar with, but seeing as how the software is over 20 years old, I think that this is more another example of how Boeing was being petulant in the bid process.

Aviation Week (subscription required) also lists the following issues:
  • The Air Force added a "receptacle credit" for the capability of receiving as well as offloading fuel. Should have been there from the start, but it's a clearly a positive capability.
  • Changed its assessment of the pavement thickness/strength at airports used in the mission modeling, allowing more A330s to be parked.
  • There was a change in ground turnaround time, which was then, "fixed for both competitors at 4 hr., 15 min.

For what it's worth, Airbus tanker is already in test, see picture:

There are 767 tankers flying, but they are substantially different from what was pitched to the USAF.

Bear Stearns Employees Already Financially Raped, Now Possibly Enslaved - Business on The Huffington Post

Jill Brooke is reporting that JP Morgan CEO Jamie Dimon is now calling Wall Street firms and threatening them if they attempt to hire away curretn Bear Stearns employees. (The hed, btw is Ms. Brooke's not mine).

He's claiming that it's "unpatriotic" to poach people before he fires them, and he also, "threatened to cut counter-party credit lines to firms that poach Bear stars before the transaction is completed".

If I were on the jury, I would vote to acquit his murderer.

On a slightly more law abiding note, I believe that the Bear employees might have grounds for one hell of a class action lawsuit.


My Grandmother, Sylvia Saroff, died last night. She was 99.

I feel Left Out!

Bill O'Reilly calls everyone else fascists, but leaves me out.

I'm crushed.

Maybe I should write about O'Reilly's bust for soliciting an underage prostitute a few years back.

Just kidding, but one wonders if how many readers this will pull in via "the Google".

Iraq: Living in the World that Kafka Created

Because it appears that the Pentagon is claiming that the "new Iraq fighting arises from surge's success".

Maybe it's not Kafka. Maybe it's the Onion. I'm not sure, but it would be nice if the press called Bush and His Evil Minions on this heads I win, tails you lose crap.

FCC Auction Rundown

I can't add much to Harold Feld's analysis. The short version is that it generated more money than expected, and unless you explicitly exclude the incumbents, they will tend to win.

People Who Should Be First Up Against the Wall When the Revolution Comes

Landlords, and banks who have foreclosed, who instead of going through a formal foreclosure, where the tenants have rights, they simply refuse to pay the water bill to force the tenants out when the water is cut off.


Yes, Secretary Paulson is saying that we need to take immediate action to "fix" Social Security.

They are, of course, using the word "fix" much in the same way that my veteranarian does.

We are (run around and scream like a little girl) about 41 years from insolvency! Ten years ago we were 42 years from insolvency! Think about what this means?

Ummmm...that in 410 years we will be down to zero years? But what do I know about math...I'm an engineer.

I think that the earnings cap should be removed and a portion of the amount collected needs to be diverted to medicare, where there is a problem, but my main reason for wanting the cap raised is the same is Warren Buffett. We both find it completely absurd that his secretary pays more of her salary in taxes than he does.

The Republicans want to kill Social Security. There is no crisis, and it does not need to be fixed, but it is a Federal program, it does not kill people, and it helps ordinary people, so they hate it for philosophical reasons.

The response to Republican attempts to kill Social Security should be, "Over the Elephant's dead rotting body".

25 March 2008

Clear Channel's Going Private Likely to Collapse

It appears the deal for private equity firms Thomas H. Lee Partners LP and Bain Capital Partners LLC to take Clear Channel Communications' Private is in the process of imploding.

The banks that are supposed to back the deal, "Citigroup Inc., Morgan Stanley, Deutsche Bank AG, Credit Suisse Group, Royal Bank of Scotland PLC and Wachovia Corp", appear willing to eat the termination fees, and the private equity firms aren't to interested in going forward either.

The only folks looking eagerly toward closing the deal are the founders, the Mays family.

The article describes the process as, "The negotiations have turned into a bizarre "kabuki" dance, said one person familiar with the situation. To protect against litigation, neither the private-equity firms nor the banks want to leave any doubt that they are committed to closing the deal. But their public actions have little to do with what's going on in private, say a number of people involved in the matter."

Basically, the first person to blink gets sued.

The deal is supposed to be for $19 billion, and a breakup fee is likely to be around $600 million, and if the banks repackage and resell the loan, which they really have to do, they are saying that it would have to be at around a 15% discount, which seems to me with my imperfect non-MBA math to show that it is cheaper to back out.

I wish that there was a way for all of them, particularly the Mays family, the creator of the cancer of the airwaves, Clear Channel, to lose.

Video below:

Supplying Weapons to Kosovo May Be Illegal

The Russian Foreign Minister makes the point that supplying arms to Kosovo, except to UN forces, is illegal under Security Council resolutions.

To the best of my recollection, he is technically correct.

While I support Kosovar independence, doesn't this mean that someone can invade us for ignoring a UN Security Council resolution?

LG Phones is People!!!!!

It appears that LG's new slider phone features a silicone keypad with a "feel of human skin".

Does Sex Ed Really Work?

Yes, and the mythology that masqurades as knowledge that is abstinence only sex education does not, because children know when you lie to them.

This has been another episode of simple answers to simple questions.

Contempt Suit in June

The House of Representatives vs. Bush and His Evil Minions&trade, specifically Harriet Miers and Josh Bolton.

Gotta start the popcorn.

Rabi' al-awwal (ربيع الأول) is Arabic for Tet

It appears now that the truce with Moqtada al-Sadr is well and truly over. Even if hasn't called for a revolt against the Maliki government, he has called for civil disobedience and self defense, and the shooting has begun.
The US blames the latest attacks on rogue Mahdi Army elements tied to Iran, but analysts say the spike in fighting with Shiite militants potentially opens a second front in the war when the American military is still doing battle with the Sunni extremists of Al Qaeda in Iraq.

"The cease-fire is over; we have been told to fight the Americans," said one Mahdi Army militiaman, who was reached by telephone in Sadr City.
The force most closely linked to Iran is not the Mahdi Army. It is sectarian, but also Iraqi nationalist.

It isn't helping that out west, the Sunni Militias are going strike because they have not been paid.

It would be comical if it were not for the killing.

The ones in the thrall of Iran, are Maliki's guys. They fought for Iran in the war, and tortured Iraqi POWs at the request of the Iranians.

The Americans don't get it. Sadr is not an Iranian puppet, he's the strongest nationalist Shia out there, though this is not stopping David Petraeus, Bushes Bitch on the Euphrates, from claiming that all the attacks are coming from Iran.

Sir, you are a lying sack of sh%$ and a disgrace to your uniform, the men who serve under you, and the United States of America.

The press coverage on this side of the pond, excepting the Monitor and McClatchy, is universally poor, with claims that the civil disobedience causing the violence.

Eric Martin makes some very good points about how Malicki and the US undermined the truce int he first place.

He notes there has been a crackdown against the Mahdi army and its related political party in advance of provincial elections.

It's pretty clear that the state security apparatus, and the US military, have been used in an attempt to influence these elections.

Ilan Goldenberg notes, when talking about the factors responsible for the current lull in the violence:
It's hard to say for sure, which of these factors [The surge, the Anbar Awakening, the Sadr ceasfire, or the Completion of ethnic cleansing in most of Baghdad] was the most important. The Bush Administration will tell you it's all about the troop levels. I've tended to believe it's more of a mix and was most inclined towards the Anbar Awakening and the sectarian cleansing as the important factors. But when you look at the data it really seems to indicate that the Sadr ceasefire may have been the key.
More than anything else, Sadr wants us out.

He may get it before November.

So, the Plot Sickens with the Bear Bailout/Buyout

Well, we have the WaPo reporting on the increased share price, and calling it "a good deal" since the stock was selling for $70 two weeks ago.

Then again, you have a noted stock analyst saying that the true cost, which includes all the debts owed, will be close to $65/share, and you have Market Watch reporter Greg Robb calling the Fed and JP Morgan's actions putting lipstick on a pig.

Economics Update

People are not feeling confident right now, Conference Board's consumer confidence index fell to 64.5, and the expectations index fell to 47.9, the latter being the lowest since December 1973.

Not surprisingly, the dollar is down as a result, though the fact that the Federal Reserve continues to run those printing presses like they were making toilet paper for rancid burrito day may have contributed.

In real estate, Freddie is seeing mortgage delinquencies increasing.

We are also seeing an explosion in payday loans, which means people are being abused by the system just as Bear shareholders are getting a freebie courtesy of the Federal Reserve.

Home Sales Rise (Not Really, We Are All Still Doomed)

So, according to so-called business reporters, we have a slight sales rise in home sales off of the biggest price drop ever, 10.7% year over year.

This might be a reasonable story, a tale of light at the end of the tunnel, except for the fact that by any reasonable metric, as Barry Ritholtz so ably notes, housing sales fell. They are down 28.3% from a year ago, and the uptick is actually a seasonal difference from January to February, which is conveniently ignored by the National Association of Realtors, who never tell the truth when a lie would serve.

People do not buy homes in January.

Morons See Dead Cat Bounce, Pretend It's Schrodinger's Cat

So, this mouthdrooling moron thinks that we have seen the bottom of a falling stock market when the Dow hit 11,740.15 on March 10.

The Fed has just dumped the gross national product of Guatemala in the stock markets, and you think that the bottom has been reached.

More phony numbers, and the DJI is always a phony number, from people who have a vested interest in dumping their crap off on you.

"The Audacity of Nope"

Details here.

Well, I thought it was a funny turn of phrase.

Sweet Cthulhu Chocolate Chip Chews, This is Stupid!!!!

So, Hillary Clinton is suggesting that Bush create, "an emergency working group on foreclosures", staffed by such notables as Robert Rubin, Paul Volker, and ....wait for it....wait for it....wait for it....wait for it....Alan Greenspan.

Alan Greenspan the man who suggested in 2004 that the housing sector was, "in good shape", we would all be better off if, "lenders provided greater mortgage product alternatives to the traditional fixed-rate mortgage"?????

I am completely at a loss for invective.

24 March 2008

Re-Regulating the Financial Markets

The New York Times notes that there is a tug of war going on between the Bush Administration and Democrats over the type and extent of new regulations.

While I think that some centralization of the "regulatory alphabet soup" is a good idea, one of the things you are hearing, particularly from the Bushies, is that there is a, "tangled web of federal and state regulators".

I think that this is Bush speak for cutting the states out of it, so actions like those of Elliot Spitzer* will be impossible.

On the other end of Pennsylania Avenue, you have Barney Frank, who I like, but truth be told, I think does not go far enough.

We have large organizations operating under the idea that they are too big to fail, and remember that Bear Stearns is a smallish player in this market, so this assesment is correct.

If the taxpayers are at risk, and they are, then the taxpayers must be allowed to regulate to minimize that risk.

Krugman makes this very point:
America came out of the Great Depression with a pretty effective financial safety net, based on a fundamental quid pro quo: the government stood ready to rescue banks if they got in trouble, but only on the condition that those banks accept regulation of the risks they were allowed to take.

Over time, however, many of the roles traditionally filled by regulated banks were taken over by unregulated institutions — the “shadow banking system,” which relied on complex financial arrangements to bypass those safety regulations.

Now, the shadow banking system is facing the 21st-century equivalent of the wave of bank runs that swept America in the early 1930s. And the government is rushing in to help, with hundreds of billions from the Federal Reserve, and hundreds of billions more from government-sponsored institutions like Fannie Mae, Freddie Mac and the Federal Home Loan Banks.
As does Noriel Roubini who believes that the actions taken to this point are band aids, and not solutions, furthermore, he notes that, "Only a few of such securities firms are systemically important and deserve the liquidity support of the Fed in case of a run on their liabilities", which is a large portion of this crisis.

Many of these institutions have, through years of lax antitrust enforcement become "too big to fail".

So, my first suggestion is that the continuing concentration of market among fewer and fewer firms in the financial arena needs to be reversed.

These firms need to be broken up into small pieces.

On CNN Money, of all places, Paul R. La Monica suggestion that investment banks need to be treated like children. It's eye catching, but wrong, particularly when he suggests that the repeal of Glass-Steagall was still a good thing..

The behavior of the banks, or more accurately the individual people working in those banks, was quite mature, if amoral.

From top to bottom, the employees of these firms behaved in a manner consistent with those employees own personal best interests, as opposed to those of the firm or the market.

The name for such a system, where individual players arbitrage for their own personal best outcome is called Capitalism, by the way.

What we need to do is to ensure that taxpayers are not left on the hook down the road for decisions made for personal benefit now.

Among other things, this means that we need real regulations of wages and benefits in the financial services industries, with real consequences including asset forfeiture and jail.

People will continue to do stupid things for good results this quarter so long as their bonuses and promotions are a result of their performance in this quarter.

I would note that I have not yet come up with any specifics on how to limit excessive compensation for short term results beyond taxing all excessive taxes. I'll put my thinking cap on.

The push for quarterly results is what leads to excessive leverage, which is what has led to many of the problems.

In 1929, you needed about 20¢ to buy $1.00 stock on margin. Following the Roosevelt regulations it was 75¢ to buy that same stock on margin, though this was lowered to 50¢ in the late 1970s.

Bear Stearns was leveraged on the order of 50 to one, or about .

Leverage is essential to a modern financial system working, but excessive leverage causes a collapse.

We need to put government auditors in the major financial firms today, with the power to review all records and investments, and to demand changes.

Also, there should be a change in taxes. If the rich have to be bailed out, and this appears to be the case, then they should make the down payments on that bail out.

I would also suggest that a surcharge be added to income tax to which no credits or deductions apply, starting at the salary of the President (currently $400K) with a 1% surcharge, and increasing by 1% for each multiple above that (so $400k-$800K would be 1%, $800K-$1.2M would be 2%, etc), to a maximum marginal rate of 75% at around $180 million a year, which would apply to all forms of compensation (H/T to Dean Baker, see below, for noting the total compensation thing).

It would serve to put a brake on executive compensation, and generated some much needed revenue for the treasury.

Dean Baker, co-director of the Center for Economic and Policy Research in Washington, DC, suggest instead that we legislate a cap on total compensation in the financial industry of $1 million.

It appeals to my vengeful side, but I think that my suggestion is better. It applies to overpaid athletes, drugged out pop stars, and worthless hotel heiresses too, and provides resources to create a better and more just society.

*No, I mean his legal actions against Wall Street, when the FTC, SEC, etc., led by Bush and His Evil Minions were letting the foxes run the henhouse.
Let's be clear, I am keeping my promise not to mention They Who Must Not Be Named. I don't see no names, do you?

Stupid Arguments

Josh Marshall has it right when he calls out Evan Bayh for being stupid, when he suggests that electoral votes should count in the super delegates decision.

He does not go far enough though.

All the arguments, whether popular votes, delegates, etc. should be irrelevant to the super delegates decision.

They are a 20% swing vote, and their concerns should be as follows (in order of descending importance):
  1. Who will be the best president of the United States of America
  2. Who is best for the party.
  3. Who is most likely to be elected.
Now it's clear that things like delegates, popular vote, and fund raising, etc. are factors in those concerns, but they are not the concerns themselves.

They are the trees, not the forest.

Because Right Now the Stakes are So Small

Again Josh Marshall has a good insight
But it seems to me that the real reason the Democratic primary race has gone from heated to vicious (at least among the candidates' supporters, if not the candidates themselves) is precisely because we're in this awkward seven week hiatus in which there are no actual elections being held.
There is no weekly reality check for the next few weeks.

787 Needs Wing Box Design

So, the latest update on Boeings increasingly delayed 787 has us seeing that Boeing and partner Fuji heavy industries will have to redesign the center wing box, because it is too weak.

Boeing's delays on the 787 now rival that of Airbus on the A380, only once the problems with the European super jumbo came out, the all came out, and we are still getting this drip, drip, drip of bad news from Seattle Chicago.

This is yet another reason why the Boeing wonks who suggest that the 787 should have been used instead of the 767 are full of it, BTW.

The USAF needs its tanker sooner, rather than later.

Yeah, Right, and the Dog Ate My Homework

So now the White House is maintaining that the computer hard drives containing the email records subject to a federal lawsuit were all destroyed as a part of computer upgrades. (Background here)

Got Everything Wrong

So says John Cole of Balloon Juice.

While it is amusing to read that he finds it, "amazing I could tie my shoes in 2001-2004", my question is more direct. What the hell are your going to do to fix it?

I've wrong on most of my predictions, but I have not pushed policy prescriptions on the basis of those predictions.

You were were more than wrong, you were an accessory to evil, and an enthusiastic one at that.

You contributed to making us less safe, killing in excess of half a million Iraqis, driving more than a million from their homes, and damaged the United States for decades to come economically, diplomatically, and morally.

You cheer led for this evil.

The Julius Streicher, the publisher of Der Stürmer was put to death for his cheer leading, and while your misdeeds are far more milder, simply saying, "oops, sorry", does not cut it

What Are you going to do to make it right?

Signs of the Apocalypse: Fox News Edition

First, Fox and Friends anchor Brian Kilmeade walks off the set over constant Obama bashing, though to be fair, they also made fun of his background as a sports caster, and then Chris Wallace also on FOX and Friends, objects to similar behavior.

The Fux Newsies were objecting to the bashing over the phrase, "typical white person".

If it were just Chris Wallace, I would assume that his father, Mike Wallace, had dope slapped him over it, but two news anchors essentially defending Obama?

I'm expecting to see the Stay Puft Marshmallow Man.

Israel's Newest F-16s Grounded on Formaldehyde Concerns

High levels of Formaldehyde have been found in the cockpits' of F-16I'ss.

The F-16 I (see picture below), is a variant unique to the IAF, with conformal tanks and a spine for additional avionics, and given the IAF's specific needs, it likely has an air conditioning system tailored to this equipment, which is likely the source of the contamination.

It could come from combustion, but the path from combustor to cockpit would be unlikely.

Common Sense Consumer Protection in Arkansas

Arkansas Attorney General Dustin McDaniel is saying that two recent State Supreme Court decisions mean that payday lenders can be prosecuted under the Arkansas Deceptive Trade Practices Act.

No offense to any reader of mine from Arkansas, and a quick look at the statistics reveals that number over the past 8 months to be 27, but this is the one of the last places that I would expect this.

I do understand that Arkansas is less corrupt than Louisiana, more populist than Texas, and less backward than Mississippi, but I find this to be a very surprising development.

While Arkansas does have a a bit of a tradition of populism, I think that this more important than simply short term politics.

There is an increasingly strong view, society wide, that deregulation of financial markets, from the very small (Payday Lenders), to the very large (Wall Street) have failed.

People realize that in the real world, there are situational and informational asymmetries that require that the government take action to prevent predators from preying on the weak.

Took them long enough.

Larry Craig Is Out!!!

The toe tapping Senator is Out!

Ummm...let me rephrase that in a slightly clearer way: Larry Craig (R-ID) is not standing for reelection.

1000 Words on Economics

Best Telecommunications Regulation Joke Ever!

Courtesy of Harold Feld's Tales of the Sausage Factory
The intervention of the Jewish holiday of Purim, which is celebrated by getting drunk until you cannot tell the difference between Verizon winning the C Block and Google winning the C Block, kept me from posting sooner.
OK, there aren't that many great telecommunications regulations jokes, but still, this is really funny....If you are Jewish.....and if you have been following the FCC's C Block auction.

OK, it's a limited audience....but I find it funny, OK?

Economics Update

Oil is holding steady, and the dollar has strenghtened, but Gasonine has hit a new record.

My predictions, which are usually wrong, Oil is pretty much permanently above $100/bbl, the dollar has a way to go down still, probably settling sell south of $1.75:€1.00, and Gasoline prices will break $4.00/gal in a year, and that there will be overshoots on all of them.

But my predictive record sucks wet farts from dead pigeons.

It looks like the Federal Home Loan Banks will be performing the way that God and Herbert Hoover* intended, in that will be making things much worse by bailing out investors in bad mortgage bonds to the tune of $150 billion.

Hoover was a stalwart supporter of doing the wrong thing, back to his days in China, where he supporter what came very close to murder in Chinese mines.

Oh....JP Morgan blinked, and upped their offer on Bear Stearns to $10/share. This is a bailout of two groups of people:
  • The Bear Stearns employees who f&%$ed up the place to begin with.
  • The investors who saw the mess, and said, "Give me some of that."
They both deserve to lose, and, of course, those people who bought at $5/share just made out like raped apes.

*Hoover created the FHLB system.

Guns on Planse, Great Idea

Now, will you please run with these scissors, and French kiss this cobra.

Yes, in our post 911 environment we decided that it would be a good thing for pilots to carry guns on flights.

Thankfully, Myth Busters has shown that it won't cause a "Goldfinger" style decompression.

Another Day, Another Taser Death

Well, a few days, and a couple of deaths actually, see here (tasered while in handcuffs), and here.

Let's be clear on this: as long as Tasers are not designated lethal weapons, they will continue to kill, and as long as the police know that they can use them, and that they do not get automatic review that a peace officer does every time he discharges a weapon, police will continue to abuse this lethal weapon.


U.S. death toll in Iraq hits 4,000

23 March 2008

The Pope Bitch Slaps Condi Rice

OK, my opinion of Benedict has improved a bit, though he is still a reactionary idiot.

The title is not mine though, I whole heatedly approve the hed, and will defend it, but that bon mot is not mine, so I cannot take credit for it.

It appears that Pope Benedict XVI has refused an audience for Condolleza Rice.

She had requested an audience in August (you know, in order to play politics with the conventions and the November election).

The pope has denied this request, ostensibly since it was his August holiday, but really for two reasons:
  • Bush and His Evil Minions in general, and Condoleeza Rice in particular, were hostile and rude to John Paul II when he sent emissaries out to attempt to prevent the war.
  • Because the US has steadfastly rebuffed requests from the "Holy See" to prevent the ethnic cleansing to of the Christian minority in Iraq.
Condoleeza Rice should not be too upset by this, "Instead of meeting the Pope, Ms Rice had to make do with a telephone conversation with the Vatican's number two, Cardinal Tarcisio Bertone, who was visiting the US during August on other business."

So, he won't talk to her, but his number two will talk to her on the phone.

Girlfriend, maybe he just ain't into you...You know.

Thank God for Tamiflu®

I went to the Health First clinic, and got a prescription for Tamiflu®.

I'm already feeling better, but I'm not going to be stupid about this. I'll skim the news and get some sleep.

McCain Aggressively Pursued Hagee's Endorsement

One of the questions about John McCain's hookup with Rightwing Bigot Evangelical pastor John Hagee is just who pursued whom.

Obviously, if McCain pursued Hagee's endorsement, there is a greater obligation for due diligence.

Well, now have this directly from Hagee's NY Times Magazine interview:

NYT: As a prominent evangelical pastor based in San Antonio, you were recently catapulted into national controversy when you endorsed Senator John McCain for president. Is it true that McCain actively sought your endorsement?

John Hagee: It’s true that McCain’s campaign sought my endorsement.
Mr. "Straight Talk" doesn't give a damn. There is no corner he won't cut, nor any value he won't turn his back on, in order to be president.