Month: April 2013

Not Surprising News………

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Though it is surprising that it was former FBI director Louis Freeh who reported that Jon Corzine ran MF Global into the ground: (Thorough investigation is not what his consulting business is all about)

The “negligent conduct” of Jon Corzine and other officers of the MF Global Holdings Ltd brokerage contributed to the firm’s dramatic collapse in 2011, according to a report by the bankruptcy trustee.

The report by former FBI director Louis Freeh said the failure of MF Global’s officers contributed to losses of as much as $2.1 billion and adds to the growing number of reports and investigations pointing to their liability.

Freeh has prepared a lawsuit against former executives for breaches of fiduciary duty, but had not filed it pending the outcome of talks with a mediator appointed in a separate securities class action, according to the report.

Freeh’s 124-page document blamed the collapse on “the risky business strategy engineered and executed by Corzine and other officers and their failure to improve the company’s inadequate systems.”

While the report was sharply critical of Corzine’s conduct, it did not focus on one of the biggest mysteries of the MF Global collapse: the misappropriation of funds from customer trading accounts.

What, you mean that Freeh was too busy looking for Monica Lewinski’s blue dress to figure out who stole the f%$#ing money?

Now, there’s a surprise.

When Freeh is on the case, it is not about finding wrong-doers, it’s about protecting the powerful and generating PR.

Yeah, the Sequester is Benign………

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That’s why cancer clinics are unable to treat thousands of patients:

Cancer clinics across the country have begun turning away thousands of Medicare patients, blaming the sequester budget cuts.

Oncologists say the reduced funding, which took effect for Medicare on April 1, makes it impossible to administer expensive chemotherapy drugs while staying afloat financially.

Patients at these clinics would need to seek treatment elsewhere, such as at hospitals that might not have the capacity to accommodate them.

“If we treated the patients receiving the most expensive drugs, we’d be out of business in six months to a year,” said Jeff Vacirca, chief executive of North Shore Hematology Oncology Associates in New York. “The drugs we’re going to lose money on we’re not going to administer right now.”

………

The care will likely be more expensive: One study from actuarial firm Milliman found that chemotherapy delivered in a hospital setting costs the federal government an average of $6,500 more annually than care delivered in a community clinic.

Those costs can trickle down to patients, who are responsible for picking up a certain amount of the medical bills. Milliman found that Medicare patients ended up with an average of $650 more in out-of-pocket costs when they were seen only in a hospital setting.

So, not only are we going to kill grandma, it’s going to cost us more money to do so.

Well, anything to make Grover Norquist happy, I guess.

Misplaced Priorities

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H/t JR at the Stellar Parthenon BBS.

I understand that they have problems getting their games out on time, and getting them out finished, they buy up companies and destroy their ideas, and they routinely treat their employers like galley slaves, but considering the excesses of they banksters, or the the slapdash contracting at KBR (which literally electrocuted soldiers in the shower), it is a bit much for a poll to vote computer gaming company Electronic Arts the “Worst Company in America”:

Video game publisher Electronic Arts has a new feather in its cap: It has won The Consumerist’s Worst Company in America award.

 The tournament rookie beat out America’s other most-hated companies by a landslide 64 percent vote. Rival honorees included Walmart, PayPal, Bank of America, and even fellow game industry villain, Gamestop.

 A statement from The Consumerist, part of the nonprofit group that publishes Consumer Reports, noted that “while both Bank of America and EA drew consumer ire for their poorly-received practices of swallowing up smaller competitors and nickel-and-diming customers with up-charges and fees, EA’s success in this year’s tournament shines a spotlight on an industry that is often considered ignored by regulators, courts, and the mainstream media.”

 “Some may look down their noses at the idea of voters picking a video game publisher as the Worst Company In America, but that is the exact kind of attitude that has allowed EA and its ilk to nickel and dime devoted customers for a decade,” said Chris Morran, Deputy Editor of Consumerist.com. “This is not just a few people complaining about bad games; this vote represents a large group of consumers who have grown sick and tired of being ignored and taken advantage of.”

There are plenty of companies that abuse and nickel and dime their customers, but the banksters blew up the world, and companies like Blackwater XE Academi murder brown people with impunity.

From all reports, and I know people in the game publishing business, EA is one of those companies that seems to fly in the face of the conventional wisdom that successful companies deliver good products that satisfy their customer needs.

But the worst company in America?

Puh-leeze!

As if the Obama Administration Revolving Door Could not Spin Any Faster………

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Promontory Financial Group has hired Former SEC Chief Shapiro:

As regular readers may recall, Promontory Financial Group was one of the huge winners from the joke on the public otherwise known as the Independent Foreclosure Review. The only accurate word in that label, it turns out, was “foreclosure”.

As part of a series of consent orders issued to servicers in 2011, the OCC mandated that borrowers who had a foreclosure underway or completed in 2009 and 2010 could receive a review to determine if their foreclosure was handled improperly and caused financial harm. If so, they could receive as much as $125,000 in compensation.

Many observers, including yours truly, could see as soon as the reviews were announced that they were destined to be a sham, since the consultants hired to perform these assessments would be selected and pad by the banks, who would also be their immediate client. And after the reviews were hastily shut down, the revelations were even worse than even the cynics had predicted. Consultants like Promontory, who worked for three servicers, including Bank of America and Wells Fargo, ran up enormous tabs via being utterly incapable of organizing a process of this scale and complexity. Not that the bank cared, since they didn’t really want the work completed. Promontory racked up an estimated $1 billion in fees. Our whistleblowers say they completed only 4,800 borrower letters at Bank of America and may not have gotten through any at its smallest IFR client, PNC (in October of 2012, after over a year of work at PNC, Promontory said the work to dat needed to be scuttled since questions had been raised about the independence of the process. The reviews were shut down two months later).

So how is Promontory using all this lucre? Buying up even more former regulators to further its reputation as a connected insider. Mary Shapiro had barely left the SEC when she was nominated for a board seat at General Electric, which despite its image as a manufacturer, has for over two decades had nearly half its revenues coming from financial services. And now Shapiro has been signed by Promontory to help arm-twist regulators not to do their job.

This sort of incestuous corruption is a feature, not a bug.

More Judges Criticize Bankster’s Get Out of Jail Free Cards

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First, it was federal Judge Jed Rakoff, who has refused to accept “no harm, no fowl” deals with the SEC, and now U.S. District Judge Sidney Stein is questioning the fairness of a settlement of shareholder lawsuit:

A Manhattan federal judge on Monday signaled he will not rubber-stamp Citigroup Inc’s proposed $590 million settlement of a shareholder lawsuit accusing it of hiding tens of billions of dollars of toxic mortgage assets.

U.S. District Judge Sidney Stein asked lawyers for the bank and its shareholders to address several issues at an April 8 fairness hearing, including requested legal fees and expenses of roughly $100 million, and the absence of payments by former Citigroup executives.

………

Stein joined other judges in recent years to question the fairness of large legal settlements in the financial industry.

Citigroup awaits a decision from the federal appeals court in New York on whether Stein’s colleague Jed Rakoff properly rejected a $285 million settlement with the U.S. Securities and Exchange Commission over the alleged defrauding of investors.

On Thursday, U.S. District Judge Victor Marrero in Manhattan cited that case in delaying a decision to approve the SEC’s $602 million insider trading settlement with a unit of Steven Cohen’s hedge fund SAC Capital Advisors LP.

………

According to court papers, the shareholder settlement also resolved claims against several former top Citigroup officials, including Chief Executive Charles Prince and senior adviser Robert Rubin. Stein asked whether this was proper.

“Does the absence of any payments from the individual defendants render the settlement unfair to class members who still hold the Citigroup stock they purchased during the class period?” he asked both sides to address.

More of this, please.

Can We Throw His Ass in Jail for Civil Rights Violations?

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We now have a report that New York City Police Commissioner Ray Kelly deliberately target people to be terrorized by the police on the basis of race:

Ever since the New York City Police Department initiated its reviled stop-and-frisk technique, the force’s laughable refrain has been that its officers are not engaging in racial profiling. It may not look like racial profiling to Mayor Michael Bloomberg or NYPD Commissioner Ray Kelly, who oversee stop and frisk, but to the millions of blacks and Latinos harassed by the NYPD over the years it is a blatant campaign against dark skin.

Today, a New York legislator testifying in a class-action suit against stop and frisk confirmed that those suspicious of the program’s racial motivations are correct. Doubling down on an accusation he made in 2011, New York State Senator Eric Adams said on the record that he heard Commissioner Kelly tell then-Governor David Paterson and a room of other lawmakers that stop and frisk targets minorities because “he wanted to instill fear in them that any time they leave their homes they could be targeted by police.”

What Ray Kelly is alleged to have said here is exactly the same as burning a cross on a hill overlooking a minority neighborhood: Instilling fear in minorities on the basis of their ancestry.

This is Bull Connor sh%$, and it’s illegal.  It’s detention and harassment on the basis of race.

If the FBI is not on the case, someone needs to get their head out of their ass, and do their f%$#ing job.

This is Not a Surprise

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What a surprise, New York State Senator Malcom Smith was caught bribing Republican officials in an attempt to secure the GOP nomination for New York City mayor:

The two men sat in the state senator’s parked car in suburban Rockland County, but New York City was at the front of their minds and the focus of their conversation.

What the senator, Malcolm A. Smith, wanted to do, the other man explained, was going to cost “a pretty penny.”

“But it’s worth it,” replied Senator Smith, a Democrat, according to a transcript of the January meeting. “Because you know how big a deal it is.”

His plan, described by federal prosecutors in a criminal complaint unsealed on Tuesday, was as ambitious as it was audacious. Mr. Smith was going to bribe his way onto the ballot to run for mayor of New York.

But he needed help, from a disparate cast of characters, including a Republican City Council member from Queens, Daniel J. Halloran III, and two Republican leaders from Queens and the Bronx, Vincent Tabone and Joseph J. Savino. And he needed the help of the other man in the car, who, unbeknown to Mr. Smith, was a cooperating witness for the Federal Bureau of Investigation and was recording the whole conversation.

Instead of appearing on the ballot, Mr. Smith’s name has landed in a marquee spot on the criminal complaint. On Tuesday, he, Councilman Halloran and the Republican Party leaders were charged with wire fraud and bribery. The senator was also charged with extortion.

This is not surprising, because he is also one of the Benedict Arnold Democrats who colluded with Republicans in the state to wrest control from the Democrats who actually won most of the seats:

New York Republicans joined forces with a group of dissident Democrats on Tuesday to form what they called a “bipartisan governing coalition” to run the State Senate, preventing the Democratic Party from taking control even after it appeared to have won a majority of Senate seats in elections last month.

The announcement was the latest twist in a state capital that has had more than its share in recent years, with a string of leadership squabbles, corruption investigations and sex scandals that at times crippled the government and made Albany a laughingstock.

The power-sharing deal announced Tuesday was a victory for New York Republicans, who are outnumbered 2-to-1 in the state’s electorate and who fared unexpectedly poorly in a series of Senate races last month. The exact outcome of the election remains unclear, because ballots in two close races are still being counted, but the consensus in Albany is that the Democrats won more seats than the Republicans.

But shortly after the elections, one Democrat said he would align himself with the Republicans, and on Tuesday five others said they would join with the Republicans to control the Senate. Many of the remaining Senate Democrats were furious, accusing the Republicans and the breakaway Democrats of orchestrating a coup to steal control.

As part of the deal, the Senate majority leader, Dean G. Skelos, a Long Island Republican, agreed to share authority over the chamber with Senator Jeffrey D. Klein, a Bronx Democrat who was the No. 2 official in his caucus before defecting nearly two years ago to form the Independent Democratic Conference.

The obvious question here is, “Why did he think that he could bribe Republicans into nominating him for Mayor?”

The simplest answer (see Occam’s Razor) as to why he might believe this is is pretty clear here:  The Republicans bribed him to jump over the aisle, and so Senator Smith expected them to be similarly receptive to bribes.

I have no evidence of this, but it seems to me that some sort of payoff had to be involved in the “Independent Democratic Conference” knifing their fellow Dems in the back.

The only question is whether it was limited to legal things, like committee chairmanships, or there was something more remunerative involved.

Considering the fact that this is Albany, I’ll take the door behind the piles of unmarked bills.

H/t Ed Kilgore.

Obamacare Hiccup ……… Is this the Shape of Things to Come

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The healthcare market for small business medical insurance mandated under the PPACA will be delayed:

Unable to meet tight deadlines in the new health care law, the Obama administration is delaying parts of a program intended to provide affordable health insurance to small businesses and their employees — a major selling point for the health care legislation.

The law calls for a new insurance marketplace specifically for small businesses, starting next year. But in most states, employers will not be able to get what Congress intended: the option to provide workers with a choice of health plans. They will instead be limited to a single plan.

The choice option, already available to many big businesses, was supposed to become available to small employers in January. But administration officials said they would delay it until 2015 in the 33 states where the federal government will be running insurance markets known as exchanges. And they will delay the requirement for other states as well.

The promise of affordable health insurance for small businesses was portrayed as a major advantage of the new health care law, mentioned often by White House officials and Democratic leaders in Congress as they fought opponents of the legislation.

Supporters of the law said they were disappointed by the turn of events.

………

D. Michael Roach, who owns a women’s clothing store in Portland, Ore., said the delay was “a real mistake.”

“It will limit the attractiveness of exchanges to small business,” he said. “We would like to see different insurance carriers available to each of our 12 employees, who range in age from 21 to 62. You would have more competition, more downward pressure on rates, and employees would be more likely to get exactly what they wanted.”

John C. Arensmeyer, the chief executive of Small Business Majority, an advocacy group, said that the delay of “employee choice” was “a major letdown for small business owners and their employees.”

Gee, the delay shafts small businesses, and favors the big players in the FIRE (Finance, Insurance, and Real Estate) sector.

Gee, that’s a surprise ……… Not.

The Obama administration doesn’t work hard for anything that does not have a payoff for the banksters and their ilk.

Manufacturing Slows

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The Institute for Supply Management’s manufacturing survey shows factory activity growth slowing:

Factory activity grew at the slowest rate in three months in March, suggesting the economy lost some momentum at the end of the first quarter as the effects of tighter fiscal policy started kicking in.

Data so far this year had shown little sign that higher taxes, and the $85 billion in across-the-board government spending cuts that took effect March 1 known as the “sequester,” had weighed on economic activity.

“It suggests the economy was probably starting to slow at the end of the quarter, possibly reflecting the impact of the fiscal headwinds coming from sequestration and higher taxes,” said Millan Mulraine, a senior economist at TD Securities in New York.

So not surprising.

Weak demand, nut-jobs who want to crash the economy in the house to reinforce their 2014 electoral prospects.

I would not be inclined to ramp up anything either.

India Rejects Evergreening Pharmaceuticals

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The Indian Supreme Court has rejected a patent for a slightly modified drug, on the basis that it was not a significant change.

The drug companies do this all the time, in order to extend their patents on drugs nearly indefinitely:

People in developing countries worldwide will continue to have access to low-cost copycat versions of drugs for diseases like H.I.V. and cancer, at least for a while.

Production of the generic drugs in India, the world’s biggest provider of cheap medicines, was ensured on Monday in a ruling by the Indian Supreme Court.

The debate over global drug pricing is one of the most contentious issues between developed countries and the developing world. While poorer nations maintain they have a moral obligation to make cheaper, generic drugs available to their populations — by limiting patents in some cases — the brand name pharmaceutical companies contend the profits they reap are essential to their ability to develop and manufacture innovative medicines.

Specifically, the decision allows Indian makers of generic drugs to continue making copycat versions of the drug Gleevec, which is made by Novartis. It is spelled Glivec in Europe and elsewhere. The drug provides such effective treatment for some forms of leukemia that the Food and Drug Administration approved the medicine in the United States in 2001 in record time. The ruling will also help India maintain its role as the world’s most important provider of inexpensive medicines, which is critical in the global fight against deadly diseases. Gleevec, for example, can cost as much as $70,000 a year, while Indian generic versions cost about $2,500 a year.

The ruling comes at a challenging time for the pharmaceutical industry, which is increasingly looking to emerging markets to compensate for lackluster drug sales in the United States and Europe. At the same time, it is facing other challenges to its patent protections in countries like Argentina, the Philippines, Thailand and Brazil.

“I think other countries will now be looking at India and saying, ‘Well, hold on a minute — India stuck to its guns,’ ” said Tahir Amin, a director of the Initiative for Medicines, Access and Knowledge, a group based in New York that works on patent cases to foster access to drugs.

………

In Monday’s decision, India’s Supreme Court ruled that the patent that Novartis sought for Gleevec did not represent a true invention. The ruling is something of an anomaly. Passed under international pressure, India’s 2005 patent law for the first time allowed for patents on medicines, but only for drugs discovered after 1995. In 1993, Novartis patented a version of Gleevec that it later abandoned in development, but the Indian judges ruled that the early and later versions were not different enough for the later one to merit a separate patent.

Leena Menghaney, a patient advocate at Doctors Without Borders, said that the ruling was a reprieve from more expensive medicines, but only for a while.

“The great thing about this ruling is that we don’t have to worry about the drugs we’re currently using,” Ms. Menghaney said. “But the million-dollar question is what is going to happen for new drugs that have not yet come out.”

Others decried the ruling, saying it was further evidence that India does not respect the intellectual property rights of pharmaceutical companies. Last year, India granted what is known as a compulsory license to a generic drug manufacturer to begin making copies of Bayer’s cancer drug Nexavar, and revoked Pfizer’s patent for another cancer drug, Sutent. Both companies have appealed the decisions.

First, evergreening does not serve to create new products, it encourages minor, non-functional, changes to existing products to maintain a monopoly.

Second, compulsory licensing is specifically allowed for under all major international IP and trade regimes.

Unfortunately, when you look at intellectual protections (IP) as property it means that the holder of that monopoly has a God given right to extract unreasonable rents forever.

There is no place where our patent system is more broken than in the evergreening of pharmceuticals, and that is saying a lot.

It’s April First

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So I guess that I should make a joke.

I considered announcing that, because of gay marriage, my wife and I were getting divorced, but it seemed sort of cliched.

Then I considered reporting a prank in Pisa, Italy, where some mischievous supporters of Beppe Grillo’s party used large Mylar mirrors to create the illusion that the Leaning Tower vertical, thereby setting a prank withing a prank, but I’ve decided that one day, I will go to Italy, and actually do this.

So, no jokes, just news ……… At least as I can best determine.

The difference between reality and The Onion is sometimes quite subtle.