Month: October 2009

Someone Was Trying to Steal Money

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Tin Foil Hat Time!

I don’t know if it was insider trading, or just the standard front-running that accompanies the high frequency trading out there, but the fact that the New York Stock Exchange was unable to report trades for much of the morning due to a flood of “erroneous” trades is a byproduct of some thing to do with the seamier side of the markets.

My guesses:

  • A software glitch on a machine doing computerized trading.
  • Someone trying to capitalize on inside information using high speed trading (which, BTW, the NYSE does not do HFT, so it gets odd).
  • A deliberate attempt to take down reporting so some sort of funny business could get done in the dark.

In any case, a lot of people were trading blind as a result, which makes for much potential for mischief:

NYSE Euronext (NYX.N)(NYX.PA), the parent of the exchange, said the delays followed “an inordinate influx” of orders received as Friday’s session got under way. Later in the session, the company had to temporarily transfer quote processing to a backup system before the problem was resolved around noon.

The exchange’s quote delays caused some tickers to be locked, but a NYSE spokesman said trades were continuous throughout.

“It was an influx of erroneous orders which were caught before they were executed,” said Ray Pellecchia. He could not say where the orders came from.

Yeah, and it could just be an ordinary f%$#-up, and I’m being a conspiracy nut.

Evil: A Cheney Family Traditon

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Yesterday, I mentioned Obama’s trip to Dover to pay his respects to the dead whose caskets were coming back that day.

I figured that at some point, some prominent Republican would try to cast it ad evil and sinister, and out of the gate comes Liz Cheney, on the John Gibson Show:

“I think that what President Bush used to do is do it without the cameras. And I don’t understand sort of showing up with the White House Press Pool with photographers and asking family members if you can take pictures. That’s really hard for me to get my head around…It was a surprising way for the president to choose to do this.”

Only, neither George W. Bush or…You know….Her Father ever went to pay their respects to the dead.

In fact, they were they supporessed any and all photographs, whether the family assented or not.

Here’s a Shocker

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It appears that Bank of America and its subsidiary Countrywide Home Loans are routinely destroying mortgage documents:

Bank of America and Countrywide Home Loans destroyed mortgage documents, and “recreate” them by “insert(ing) data as they see fit,” to cover up their own failure to keep records – or their fraud – according to a federal RICO class action.

“To cover up the servicing mistakes and fraud and misrepresentation in the servicing of a consumer escrow, Defendants ‘recreate’ letters, insert data as they see fit, and fail to produce the entire HUD complaint form. This way, a consumer is left in the dark about the fraud that occurred to them,” the complaint states.

Lead plaintiff Kim Gorham says that when she sent a letter seeking information about her escrow account, she was informed that it had been “destroyed by a letter opener.”

After repeated requests, Gorham, who is blind, received her purported escrow analysis, but it was “100 percent illegible,” according to the complaint. The defendants knew that Gorham was legally blind, the complaint states.

She says that getting a “clear and concise” statement from the defendants has been an “impossible task.”

Countrywide routinely responded to customers’ requests for records by claiming they were “unavailable or destroyed,” according to the complaint.

The lawsuit alleges that the records were destroyed, “in an attempt to suppress damaging information.”

While not every lawsuit has merit, and a defendant should be presumed innocent, this certainly justifies a hearty, “Hoocoodanode?”

BoA will be paying for acquiring Countrywide for decades to come.

What a Moron

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I came across an article in the Washington Post yesterday….No really in the paper edition, about the problems with healthcare in China.

In a rather extensive article, they show how the increasingly private healthcare system is bankrupting ordinary Chinese:

China’s health-care system is in disarray, a side effect of the market reforms that have spurred private enterprise and rapid growth since 1980. Before then, state-owned companies offered cradle-to-grave care, part of a system based on danwei, or work units, that provided health, education, pensions and other benefits. But as the economy has grown more diverse, an increasing number of Chinese have had to fend for themselves, with only a porous government insurance program to help.

While there are some problems with a shortage of medical facilities, particularly in the rural hinterlands, the problem is that people are having their lives destroyed by the costs that they must bear under an increasingly spotty system of healthcare access.

Nonetheless But further down, for reasons known only to God, reporter Steven Mufson feels compelled to bring in a complete idiot as an “expert”:

China’s State Council is eager to improve the situation but can’t decide how. The government currently fixes the prices of all medical services, and doctors are treated — and paid — like public officials. But that has contributed to a shortage of doctors as many talented Chinese choose better-paid professions.

Some experts say more private spending and investment would improve the system. Gordon G. Liu, a professor of economics at Beijing University’s Guanghua School of Management, said he would let people with means spend more money on care, which he said would increase the availability of care by giving doctors incentives to work harder and by luring more Chinese into the medical profession.

So this guy’s solution is to raise prices, when the problem is not that there aren’t enough doctors, but that it’s already too expensive, because this will have doctors clamoring to treat all those rich people farming in rural areas?

Why on earth does the reporter feel compelled to bring this in to begin with? It has nothing to do with the problem described, and it is precisely the wrong thing to do.

This is Not a Business Lunch

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So, after Mark Sanford “hiking the Appalachian Trail,” Joe Wilson heckling a presidential speech, and those Republican County Chairman going on about how good Jews are with watching their money, one wonders what other shoe will drop from the South Carolina Republican party to as they continue the program to help employment by making Stewart’s, Colbert’s, O’Brien’s, Letterman’s, and Leno’s Job easier.

Well, wait no more. There is Assistant Attorney General Roland Corning, who wages a war on the business lunch that makes the fictional “war on Christman” look like an arcade game.

It appears that Corning, age 66, was hanging out in his car at a graveyard with an 18 year old stripper, along with Viagra and sex toys, and when police officer Michael Wines showed up in a marked car, Corning, “attempted to make a hasty retreat, spinning the tires in the driveway and accelerating rapidly.”

It gets better. When finally apprehended, the police verify who he is by calling the Attorney General’s office, where his wife answers the phone, and then rats him out to the notifies Attorney General, who fires his flabby white ass.

The high point of the police report:

The search revealed a sex enhancement drug and some sex toys. According to the report, Corning told Wines he had a prescription for the medication and the other items were always in the car “just in case.“

(emphasis mine)

Just in case….Yeah sure….I always carry sex toys and Viagra in my car….Why do you think that they call them “Jumper Cables.”

If Andrew Cuomo Does Not Announce for NY Governor Soon

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Spitzer on Ratigan

Eliot Spitzer should.

Listen to him here. He gets what is going on with Wall Street, and knows exactly what the monster is, and how to slay it.

Andrew Cuomo knows this about Wall Street too, and doesn’t have that whole, “Hypocrite Mr. Clean who paid for Blow-jobs from a Skanky New Jersey Prostitute” vibe, so I prefer Cuomo.

Incumbent “accidental” Governor David Paterson, by contrast, has been very much in the pocket of Wall Street, fighting kicking and screaming about anything that could possibly inconvenience the “Masters of the Universe”, and the Governor of New York needs to be more than that.

What’s more, David Paterson is dead meat on the table, he’s polling at Dick Cheney numbers:

Only 15 percent of the 624 voters polled between October 14 and 18 would re-elect Paterson while 72 percent preferred someone else, the poll by Siena College’s Research Institute found.

The governor’s job performance was rated negative by 79 percent to 19 percent.

The only question is whether he bows out, gets beaten in the primary, or gets beaten in the general.

I think that David Paterson is beginning to get a clue about this, probably because he is having trouble raising funds.

Seriously, and if a Republican takes the state house in 2010, it means that redistricting will remain what it is in New York, and we’ll be stuck with an over-representation of Republicans in an overwhelmingly Democratic state.

It’s how the ‘Phants held the State Senate for 40 years.

Seriously, his numbers are so bad, that Rudolph Giuliani could beat him without running a campaign.

Even more impressively, Rudolph Giuliani could beat him if he did run a campaign, because if there is anything that the 2008 Republican Presidential primaries showed, it was that finding Rudy Giuliani on the campaign trail was a lot like finding a cockroach in your coffee.

Economics Update

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Click for full size


Employment Chart H/t Calculated Risk

Home Vacancy, Home Ownership Rates, and Rental Vacancy Rates Also Courtesy of Calculated Risk


Some Improvement on Homeowner Vacancy Rates


Note that the Rental Vacancy Rate is an All Time High

Thursday is the new jobless day, and new unemployment claims were basically flat, falling from 531,000 initial claims to 530,000. The 4 week moving average, a generally better metric, was down to 526,250, from the previous week’s 532,250, and continuing claims fell to 5,797,000 down 148,000 from last week’s 5,945,000.

All in all, generally good news.

Additionally, US GDP increased at a 3.5% annual rate in the 3rd, which is a solid, though not stellar, growth rate.

By way of example, the recovery in the early 1980s was around 7% for a full year.

There is also the question about how much of this was driven by cash for clunkers driven auto sales, and the first time home buyer’s tax credit.

The former has expired, and the is due to expire, though I would only give it a 1:2 chance that Congress won’t renew it.

In any case, the 30-year fixed mortgage was basically flat this week.

The market’s reaction to the GDP news was as expected.

There was movement from safety to higher rates of return, which drove US Treasuries down, and their yields up, and the Dollar fell.

Anticipation of a recovery also drove oil higher, to back above $80/bbl.

Elections Make a Difference: Labor Regulations

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It appears that people who want to treat their employees like so much excrement are distressed that Barack Obama is not vociferously anti union, and that under his watch union leaders have access to, and information from, the White House, and that sensible rules have been established:

Delta Air Lines, the world’s largest carrier, would be more likely to lose union elections sought by flight attendants and machinists if a proposal by the AFL-CIO is approved.

The workers asked the National Mediation Board in July and August to clear the way for an election. Last month, the AFL-CIO petitioned the board to revise procedures and allow a union if most of those voting approve, instead of a majority of all workers in the class.

The board plans to announce a proposal in coming days to advance the union request on voting rules, people familiar with the matter said. Seven Republican senators said in a Sept. 30 letter that the board was delaying a decision on the union election while it considers the new vote-counting method.

Yes, under the old system, a non-vote was counted as a no vote, so you could lose because someone got the sniffles, or just didn’t want to be bothered to vote.

What’s more, they are appointing people who are not management toadies to boards. In the case of the National mediation board, you have a former flight attendent union official replacing a former lobbyist for Northwest (now a part of Delta), and the President of Delta Airlines is pissed about it:

“You have two former heads of AFL-CIO unions at the NMB and they really are politicizing the process,” Delta CEO Richard Anderson said on a conference call with investors last week.

My heart bleeds borscht for you sadistic equestrian necrophiliac…But that’s beating a dead horse.

Even more shocking, the head of OSHA decided to, “replace pictures of OSHA managers displayed in a conference room with photos of workers who had been killed on the job.”

It gives one the vapors.

I’m not sure how deep the support for labor is in the Obama White House, but what is going is a welcome change form the vociferous hostility exhibited by Bush and His Evil Minions&trade.

These have Epic Fail Written All Over Them

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In order to deal with budget issues, Mayor Daley of Chicago is considering selling its water system to private operators, and allowing them to charge whatever they want.

So he gets the money, and succeeding generations get the revenue loss and more expensive water.

Also, the state that has so many bad ideas that it gave us both Barry Goldwater and John McCain is looking to turn over operation of their prisons to a private firm.

This one is a little different though, because private prisons have already been tried, and failed, with some of the institutions going so far as to bribe judges to send children to them for minor crimes.

This will not end well.

Ford’s Unions Draw a Line in the Sand

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There have been 6 plants so far that have rejected Ford’s request concessions on their contracts in order to match the terms at Chrysler and GM.

I understand it. If I were a worker on the Ford shop floor, and I had already made major concessions about 8 months ago, I’d want to make sure that the shareholders, including the Ford family, were wiped out before I would give anything more:

[UAW Local President Tom] Spears, who backed the contract changes, said in an interview. “The membership did not have a warm reception to additional contract modifications. We did this in ‘05, ‘07 and in February and now they’re back at us again.”

Of course, you will doubtless hear how these guys are being selfish and stupid, and have to give back more, but if you go through those same papers over the weeks before and after, you will find them defending the outrageous pay and bonus contracts as sacrosanct.

It’s kind of like the Droit de seigneur, where of the local lord in the old days had the right to deflower any new bride, only with the banks, we all get f#$@ed.

Signs of the Apocalypse: Wall Street Journal Edition

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There it is in black and white, on the opinion page of the Rupert Murdoch owned Wall Street Journal, a we have an article that calls out the Rupert Murdoch owned Fox News for lack of journalistic integrity:

But no journalistic operation is better prepared to sing the tragedy of its own martyrdom than Fox News. To all the usual journalistic instincts it adds its grand narrative of Middle America’s disrespectful treatment by the liberal elite. Persecution fantasy is Fox News’s lifeblood; give it the faintest whiff of the real thing and look out for a gale-force hissy fit.

The author, Thomas Frank, had better hope that Rupert Murdoch does not read the OP/ED page of his flagship newspaper.

Luckily for Mr. Frank, I’d give 2 to 1 odds that he doesn’t.

A Level of Class that You Would Never See Out of Bush and His Evil Minions™

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How will Fox call this Communist?

Or for that matter, his Dad, who instituted the shameful news blackout on the repatriation of the bodies of servicemen killed in action.

I have been disappointed about a lot of things, but his going to Dover Air Force Base to honor troops killed in Afghanistan is a demonstration of Menschlichkeit.

Bush Jr. spent his entire term avoiding things like this, because he’s a coward with no integrity.

The picture on the left is him saluting* the men as they are transported off the transport

Video below.

*I know that this is a picayune observation, as this is a genuine show of respect, but I thought civilians weren’t supposed to salute, could someone with military experience please inform me on the finer points?

Details on Healthcare Bill

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PDF link to house bill. (1990 pages)

I don’t read that fast, but here is a my summary based on reading the Wonk Room’s summaries:

  • Bill won’t really phase in until 2013 (stupid, you need the benefits to become apparent sooner, rather than later).
  • Adds a high risk pool for the time between the enactment and when the benefits kick in.
  • Public option is not the “strong” (based on Medicare reimbursement) option.
  • Requires large (how large?) employers to provide health insurance.
  • Makes the medicare doctor reimbursement permanent, eliminating the annual reimbursement rate Kabuki in the Congress.
  • Kills insurer antitrust exemption.

It’s better than anything likely to come out of the Senate.

Breaking: House Dems Announce Their Bill

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Listening on CSPAN.

Pelosi is giving her House leadership is giving their press conference on the steps of the Capitol.

Pelosi:
10: 38 am — Will close “Doughnut Hole” on prescription drugs.

10: 39 am — Will have public option and end preexisting condition exclusion.

Hoyer:
10: 39 am — No specifics

Other folks:
10: 46 am — Carole Shea Porter brings out the “Petting Zoo”: a medicare recipient from New Hampshire to talk about Doughnut hole.

10: 49 am — Doughnut hole will be phased out between 2010 through 2019.

10: 52 am — More “petting zoo” with a small business owner.

James Clyburn:
10: 56 am — Just introduces Mary Joe Kilroy, who has MS.

10: 52 am — Changes on caps, pre-existing conditions, etc.

11:03 am — More petting zoo.

11:11 am — We’re just into soundbites now, bye.

D’oh!!!!

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You know, when you are an insurance company, like Blue Cross/Blue Shield, it is not a good idea for you to include a request for your customers to contact their Congressman to oppose the public option along with a notice of a rate increase:

First, they learned their rates will rise by an average of 11 percent next year.

Next, they opened a slick flier from the insurer urging them to send an enclosed pre-printed, postage-paid note to Sen. Kay Hagan denouncing what the company says is unfair competition that would be imposed by a government-backed insurance plan. The so-called public option is likely to be considered by Congress in the health-care overhaul debate.

“No matter what you call it, if the federal government intervenes in the private health insurance market, it’s a slippery slope to a single-payer system,” the BCBS flier read. “Who wants that?”

Plenty of people, it turns out.

Indignant Blue Cross customers have rebelled against the insurer’s message, complaining that their premium dollars have funded such a campaign.

They’ve hit the Internet in a flurry of e-mails to friends and neighbors throughout the state. They’ve called Hagan’s office to voice support for a public option. They’ve marked through the Blue Cross message on their postcards to instead vouch support, then dropped them in the mail — in at least one case taped to a brick — to be paid on Blue Cross’ dime. Or dimes.

(emphasis mine)

As the saying goes, “ない愚かさはない薬です”.*

*Pronounced in Japanese, “baka ni tsukeru kusuri wanai”, which means, “There is no medicine for stupidity.”