Month: September 2017

If You Have a Problem Understanding Monetary Theory, Read This

Rebecca Rojer has done meticulous work describing Modern Monetary Theory (MMT), and seeing as how it is an approach that is both becoming more popular, and is in opposition to the (almost always wrong) economic orthodoxy, it pays to understand this:

Too often the origins of our economic ills are cloaked by a mystical reverence for some autonomous money spirit. The economists behind Modern Monetary Theory (MMT) seek to lift money’s veil by studying the specific actions that occur as money is created, circulated, and destroyed.

For those seeking a grand, unifying sociopolitical economic theory, MMT will disappoint. But as an analytic tool, MMT clarifies who holds genuine power—sovereignty—within society, and how they organize the money system to serve their interests. Unsurprisingly, this is often a story of tremendous cruelty and exploitation.

But the revelation that the rules of money are not immutable laws of nature but are instead created and constantly modified by people opens up possibilities beyond the scope of our current political imagination. The questions become: What sort of society do we want? Do we have the physical resources to support that society? And finally, how the hell do we muster the political will to get there?

At its core, MMT sees money as being a construct that derives from the willingness of the state to use coercion, and frequently violence, to enforce the use of a token for value.

Typically, this is done through taxation. The sequence runs like this:

  1. Government: Pay your taxes.
  2. Citizen: Here is some grain.
  3. Government: Nope, you have to use my coin.
  4. Citizen: But I have no coin.
  5. Government: Then sell your grain to give coin to me.
  6. Citizen: Sell my grain to who?
  7. Government: You can sell it to me, or to the blacksmith who I paid for spears, or to whoever the blacksmith paid with my coin.

Thus, Money is born.

Read the rest.  It opens a world of possibilities not imagined by our current leaders..


Caption this picture: (H/T naked capitalism)

Oh Snap!

In response to reports that the EU scientific report on the safety of its glyphosate (RoundUp) weedkiller, where large blocks of text were copied and pasted from Monsanto application for re-approval, the European parliament held hearings to investigate whether or not the agricultural giant exerted undue influence on the process.
Monsanto refused to attend the meeting, so the EU banned Monsanto and its lobbyists from the European parliament:

Monsanto lobbyists have been banned from entering the European parliament after the multinational refused to attend a parliamentary hearing into allegations of regulatory interference.

It is the first time MEPs have used new rules to withdraw parliamentary access for firms that ignore a summons to attend parliamentary inquiries or hearings.

Monsanto officials will now be unable to meet MEPs, attend committee meetings or use digital resources on parliament premises in Brussels or Strasbourg.

While a formal process still needs to be worked through, a spokesman for the parliament’s president Antonio Tajani said that the leaders of all major parliamentary blocks had backed the ban in a vote this morning.

“One has to assume it is effective immediately,” he said.

I’m a pessimist, so I expect that, after aggressive American lobbying, the EU will re-approve the chemical, but I’d really love to see them get slapped down.

Oh, Crap!

The Supreme Court will hear a challenge to public labor unions.

With Gorsuch on the board, I expect a 5-4 decision saying that unions cannot collect fees to cover the cost of representing non members, effectively gutting  public labor unions:

Its conservative majority restored, the Supreme Court said Thursday it will return to an issue with the potential to financially cripple Democratic-leaning labor unions that represent government workers.

After the justices deadlocked 4-4 in a similar case last year, the high court will consider a free-speech challenge from workers who object to paying money to unions they don’t support.

The court, with conservative Justice Neil Gorsuch on board, could decide to overturn a 40-year-old Supreme Court ruling that allows public sector unions to collect fees from non-members to cover the costs of negotiating contracts for all employees.

The union fees case is among nine new cases the justices added to their docket for the term that begins on Monday. Others deal with a defendant’s right to direct his own defense, police searches of vehicles and overtime pay for service advisers at car dealerships.

Unions, and public employees, are going to get absolutely screwed.

North Korea is Desperate

No, I don’t mean that the sanctions are causing real problems. Nor do I mean that military posturing by the US has them terrified. What I mean is that Donald Trump is simply too weird for them to understand, so they are trying to hire Republican political consultants to explain what the f%$# is going on.

“Their number-one concern is Trump. They can’t figure him out,” said one person with direct knowledge of North Korea’s approach of experts on Asia with Republican connections.

You and me both can’t figure Trump out.

 I think that the DPRK should consider hiring Paul Manafort, seeing as how he’s a Republican political consultant, and he’s not got a lot of clients right now.

This is Kind of Tempting

The websites of US telly giant CBS’s Showtime contained JavaScript that secretly commandeered viewers’ web browsers over the weekend to mine cryptocurrency.

The flagship and its instant-access sibling silently pulled in code that caused browsers to blow spare processor time calculating new Monero coins – a privacy-focused alternative to the ever-popular Bitcoin. The hidden software typically consumed as much as 60 per cent of CPU capacity on computers visiting the sites.

The scripts were written by Code [Coin] Hive, a legit outfit that provides JavaScript to website owners: webmasters add the code to their pages so that they can earn slivers of cash from each visitor as an alternative to serving adverts to generate revenue. Over time, money mined by the Code-Hive-hosted scripts adds up and is transferred from Coin Hive to the site’s administrators. One Monero coin, 1 XMR, is worth about $92 right now.

Let me start by saying that I won’t be putting code like this on my site.

I am considering placing an additional button on my tip jar (aka Matthew’s Saroff’s Beer Fund), but it would take the form of another donation button, since the revenue from Google™ Adsense™ is so pathetic.

If I do this, it will be voluntary, another button to click on the page, and I might occasionally nag my reader(s) to click the button.

As always, note that this post should in no way be construed as an inducement or a request for my reader(s) to click on any ad that they would not otherwise be inclined to investigate further. This would be a violation of the terms of service for Google™ Adsense™.

Yeah, Like This is Gonna Work………

The Commodity Futures Trading Commission, which in recent years has been rather more aggressive in its investigation and regulation of various financial shenanigans, is changing its policies to rely soley on financial malefactors reporting themselves.

Yeah, like That is going to work:

After years as a sleepy federal backwater, the Commodity Futures Trading Commission became one of Wall Street’s most aggressive watchdogs during the Barack Obama administration.

Now the agency — which is responsible for policing a broad swath of markets and financial machinery, from trading in commodities to digital currencies to the complex derivatives that helped torpedo the financial system in 2008 — is shifting its law enforcement strategy: It will increasingly look to banks and other financial institutions to come clean on their own about misconduct and problems in the market.

The commission’s director of enforcement, James McDonald, plans to unveil the new framework in a speech Monday night at New York University. It is premised on the idea that large financial institutions, given the right incentives, have the potential to be invaluable partners for law enforcement.

“We start with the shared understanding that the vast majority of businesses want to comply with the law,” Mr. McDonald will say Monday, according to a draft of the speech reviewed by The New York Times.

Yeah, this goes hand in hand with Citi going back into the Synthetic CDO market, so I expect to see a resurgence bucket shops to accompany this regulatory malfeasance.

We are f%$#ed.

Things Just Went Pear Shaped in Iraq

Kurdistan has just overwhelmingly backed a referendum for independence, and the government in Baghdad is going postal:

The Iraqi government escalated its confrontation with its northern Kurdish region on Wednesday, threatening to send troops and seize oil fields there and taking steps to shut down international flights to and from the region.

The moves came in retaliation for a referendum on Monday in which the region, Iraqi Kurdistan, voted decisively to seek independence from Iraq. Kurdish officials announced Wednesday that nearly 93 percent of voters approved the referendum, which aims to create an independent state for the Kurds, an ethnic minority in Iraq.

Iraq’s Parliament asked the country’s prime minister on Wednesday to deploy troops to the oil-rich city of Kirkuk, one of several disputed areas held by Kurdish troops but claimed by Baghdad, and to take control of all oil fields in the Kurdish region.

A decision to send troops would be up to Prime Minister Haider al-Abadi. He gave no public indication of his intentions on Wednesday, except to say he wanted “no fighting among the people of the country.”

He also sent a delegation from the Iraqi military to Iran to “coordinate military efforts,” a military statement said.

Iraq has called the vote illegal and has vowed to ignore the results. The vote has also provoked the Kurdish region’s two powerful neighbors, Turkey and Iran.

All three countries have been conducting military exercises near the border of Iraqi Kurdistan this week.


Iraqi aviation authorities notified foreign airlines on Wednesday that it would cancel all permits to land and take off from two international airports in the Kurdish region as of Friday afternoon. The action followed an ultimatum by Prime Minister Abadi on Tuesday for Kurdistan to surrender control of its two international airports or face a shutdown of international flights.

This Business Will get out of Control. It Will get out of Control and we’ll be Lucky to Live Through It.

This is going to get very crazy very fast.  I honestly expect both Iraq and Turkey to threaten invasion with a reasonable chance of this leading to an actual invasion.

To quote Freddie Dalton Thompson from The Hunt for Red October:

Crazy Motherf%$#er Wins Republican Primary

What? Not specific enough?

OK, It was the Georgia Senate primary, and the crazy motherf%$#er just won.

What, still not specific enough?

OK, it was Roy Moore who beat the rather aptly named Luther Strange:

Roy S. Moore, a firebrand former chief justice of the Alabama Supreme Court, overcame efforts by top Republicans to rescue his rival, Senator Luther Strange, defeating him on Tuesday in a special primary runoff, according to The Associated Press.

The outcome in the closely watched Senate race dealt a humbling blow to President Trump and other party leaders days after the president pleaded with voters in the state to back Mr. Strange.

Propelled by the stalwart support of his fellow evangelical Christians, Mr. Moore survived a multimillion-dollar advertising onslaught, in the eight figures, financed by allies of Senator Mitch McConnell, the majority leader. His victory demonstrated in stark terms the limits of Mr. Trump’s clout.

In a race that began as something of a political afterthought and ended up showcasing the right’s enduring divisions, the victory by Mr. Moore, one of the most tenacious figures in Alabama politics, will likely embolden other anti-establishment conservatives to challenge incumbent Republicans in next year’s midterm elections.

And more immediately, the party will be forced to grapple with how to prop up an often-inflammatory candidate given to provocative remarks on same-sex marriage and race — all to protect a seat in a deep-red state. Mr. Moore’s incendiary rhetoric will also oblige others in the party to answer for his comments, perhaps for years to come, at a time when many Republicans would just as soon move on from the debate over gay rights.

On Dec. 12, Mr. Moore will face Doug Jones, a former federal prosecutor and the Democratic nominee, in a race that will test the party loyalties of center-right voters who may be uneasy about their nominee. It may also reveal just how reliably Republican the state has become in the quarter-century since a Democrat last won a Senate election here.

My prediction for the general election: 

  • We will receive innumerable fund raising emails. 
  • Doug Jones will spend a lot of money, and hire Democratic Party consultants.
  • They will advise him to run against Trump and avoid talking about real issues.
  • Doug Jones will listen to these consultants.
  • Doug Jones will lose the election badly.
  • Said consultants will blame Bernie Sanders.

Not the Onion

The National Review is siding with a black athlete over a white Republican.

I think that this is a sign of the apocalypse:

Americans do not and should not worship idols. We do not and should not worship the flag. As a nation we stand in respect for the national anthem and stand in respect for the flag not simply because we were born here or because it’s our flag. We stand in respect because the flag represents a specific set of values and principles: that all men are created equal and that we are endowed with our Creator with certain unalienable rights.

These ideals were articulated in the Declaration of Independence, codified in the Constitution, and defended with the blood of patriots. Central to them is the First Amendment, the guarantee of free expression against government interference and government reprisal that has made the United States unique among the world’s great powers. Arguably, it is the single most important liberty of all, because it enables the defense of all the others: Without the right to speak freely we cannot even begin to point out offenses against the rest of the Constitution.

Now, with that as a backdrop, which is the greater danger to the ideals embodied by the American flag, a few football players’ taking a knee at the national anthem or the most powerful man in the world’s demanding that they be fired and their livelihoods destroyed for engaging in speech he doesn’t like?

I guess that this falls in the, “Stopped clock,” category, but still, the National Review?

We are in Bizarro World.

Oh Dear Lord!

The vaguely legal form of gambling known as Synthetic CDOs are back, but don’t worry, Citigroup is telling us that it’s different this time.

“It’s different this time,” is the most terrifying phrase in finance:

By now, the whole Lucy-and-the-football thing has become a political cliché, which is the worst kind of cliché to be. However, while considering the history and practice of the Wall Street casino, it is the most accurate metaphor and it’s likely to be until the day of glory and sunshine when the tumbrels begin to roll. From Bloomberg:

The 35-year-old Citigroup Inc. director has spent the past two years meeting clients, speaking at industry panels and becoming the face of a resurgent market for synthetic CDOs — complex derivatives that let buyers make big, leveraged bets on the health of corporate America. Along the way, she’s helped establish Citigroup as its dominant player. It’s an astonishing comeback for the roughly $70 billion market for synthetic CDOs, which rose to infamy during the crisis and then faded into obscurity after nearly destroying the financial system. But perhaps the most surprising twist is Citigroup itself. Less than a decade ago, the bank was forced into a taxpayer bailout after suffering huge losses on similar types of securities tied to mortgages. Now, many in the industry say Citigroup is responsible for over half the deals that come to market, though precise numbers are hard to come by.

I’ll bet they are.

This time, Citigroup says, it’s doing things differently. The deals are tailored in a way that insulates it from any losses, while giving yield-starved buyers a chance to reap returns of 20 percent or more. The market today is also just a fraction of its size before the crisis, and few see corporate defaults surging any time soon. But as years of rock-bottom interest rates have pushed investors toward riskier products, the revival of synthetic CDOs may be one of the clearest signs yet of froth in the credit markets.

Why in the everloving fck would we trust these clowns again? And, even if we all got really stoned and decided to do that, why would we trust them with the same goddamn hand grenades that blew up everything the last time? There’s recividism and there’s recidivism and then there’s a genetic predisposition to stick your hands in everyone’s pockets and steal every last lint-covered penny that’s in there.

This is unbelievably f%$#ed up and sh%$.

More of This

A group of people on Twitter known as “Sleeping Giants” has taken to visiting Breitbart, taking screenshots showing the ads and then naming and shaming the advertisers:

Hardly anyone paid attention last November when a strangely named Twitter account, Sleeping Giants, sent its first tweet into the digisphere. “Are you aware that you’re advertising on Breitbart, the alt-right’s biggest champion, today?” read the tweet, aimed at a consumer lending outfit called Social Finance. “Are you supporting them publicly?”

Within 30 minutes, Social Finance replied, tweeting that it would stop running ads on Breitbart.

It was, it turns out, the start of an odd, and oddly effective, social media campaign against Breitbart, the influential conservative news site headed by Stephen K. Bannon, President Trump’s former campaign chairman and ex-chief White House strategist.


Sleeping Giants’ basic approach is to make Breitbart’s advertisers aware that they are, in fact, Breitbart advertisers. Many apparently don’t know this, given that Web ads are often bought through third-party brokers, such as Google and Facebook. The brokers then distribute them to a network of websites according to algorithms that seek a specific target audience (say, young men) or a set number of impressions.


So when an ad appears on Breitbart, Sleeping Giants or one of its 109,000 Twitter followers and 35,000 Facebook followers flag the advertiser, often accompanied by an image of the sponsors’ ad next to a Breitbart story.

The other day, for example, a Sleeping Giants follower tweeted at Country Inns, informing the hotel chain that it was advertising on “the racist Breitbart site.” Within a day, the company tweeted back: “Thank you for your concern. . . . We have added Breitbart to our blacklist of ads.”

This apparently happens a lot. Sleeping Giants’ database lists nearly 2,900 companies that have declared Breitbart off limits since November — an astonishing figure, though one hard to confirm because some ad buys recur. Nevertheless, it’s not an implausible number. During one 24-hour period, advertisers such as the air-conditioning manufacturer Rheem, transport operator Caltrain, Sutter Health Plus and Rose Medical Center of Denver all publicly acknowledged that they had blacklisted Breitbart in response to a Sleeping Giants tweet.


The group decided to single out Breitbart almost by happenstance. “It really happened as a reaction to Steve Bannon’s rise,” the spokesman says. “We weren’t familiar with Breitbart at the time and were obviously pretty shocked at the articles. . . . To be honest, we weren’t familiar with [other conservative] sites,” so those weren’t even considered, he says.

The group has raised about $1,500 from T-shirt sales and about $7,000 from an online fundraiser, but it otherwise operates with little overhead, he notes. “If I had a nickel for every claim that we’re being funded by [liberal billionaire activist] George Soros, I’d be well off. It’s crazy. There’s not much need for funding. Tweeting is free.”

Two points here:

  • People have been writing to advertisers about where their ads appear since Madison Avenue was a cow path.
  • The fact that the big players in the online advertising market are this cavalier with how they serve up ads.  If you buy ads, be aware of this, or maybe beware of this; your choice.

I think that I might know someone who knows who these guys are.

Wah ……… Wah ……… Wah ……… Waaaaahhhhhh

Cue Sad Trombone Music

Mitch McConnell just threw in the towel in the last attempt to repeal Obamacare:

Senate Republican leaders on Tuesday abandoned their latest campaign to dismantle the Affordable Care Act, conceding that their plan lacked key support. But they showed little interest in moving swiftly to shore up the seven-year-old law with the crucial funding it needs.

The official collapse of the Cassidy-Graham health-care bill once again leaves the party short of fulfilling a signature promise, which some Republicans worried could inspire a backlash among their base heading into the 2018 midterm elections.

And the failure of that alternative to the ACA, combined with the GOP’s reluctance to fix weaknesses in the existing law, leaves states, insurers and millions of consumers who rely on its coverage with substantial uncertainty. Enrollment begins in barely a month for 2018 health plans in marketplaces created under the law.

The Senate leaders said they would turn their attention to their next major legislative undertaking. “Where we go from here is tax reform,” Majority Leader Mitch McConnell (R-Ky.) told reporters after holding a closed-door policy lunch with members of his caucus.

Republicans already are bracing for the political fallout from the measure proposed by Sens. Lindsey O. Graham (S.C.) and Bill Cassidy (La.)., which McConnell had hoped to bring to a vote this week. They said the pressure to pass a tax overhaul bill was higher than ever and hoped the Republican base would give them a bit more time to take another shot at repealing the ACA.

Sucks to be Mitch McConnell today, then again, it sucks to be Mitch McConnell EVERY day.

About the only thing that sucks worse is being Elaine Chao.


I am not a big fan of the music, it’s mindless pop, but this was done in one continuous shot with one camera, which is impressive, even with a Steadicam:

Not a Surprise

The EU spent €360,000.00 on a study of the effects of piracy on sales of media, and found that there was no evidence of an effect, so they buried the report in a deep hole in Brussels until an MEP demanded its release:

One of the problems in the debate about the impact of unauthorized downloads on the copyright industry is the paucity of large-scale, rigorous data. That makes it easy for the industry to demand government policies that are not supported by any evidence they are needed or will work. In 2014, the European Commission tried to address that situation by putting out a tender for the following research:

to devise a viable methodology and to subsequently implement it in view of measuring the extent to which unauthorised online consumption of copyrighted materials (music, audiovisual, books and video games) displaces sales of online and offline legal content, gathering comparable systematic data on perceptions, and actual and potential behaviour of consumers in the EU.

The contract was awarded to Ecorys, a “research and consultancy company” based in the Netherlands that has written many similar reports in the past. The value of the contract was a princely €369,871 — over $400,000. Given that hefty figure, and the fact that this was public money, you might expect the European Commission to have published the results as soon as it received them, which was in May 2015. And yet strangely, it kept them to itself. In order to find out what happened to it, a Freedom of Information (FOI) request was submitted by the Pirate Party MEP, Julia Reda. It’s worth reading the to and fro of emails between Reda and the European Commission to get an idea of how unhelpful the latter were on this request. The European Commission has now released the report, with the risible claim that this move has nothing to do with Reda’s FOI request, and that it was about to publish it anyway.


The European Commission was quite happy to publish partial results that fitted with its agenda, but tried to bury most of its research that showed industry calls for legislation to “tackle” unauthorized downloads were superfluous because there was no evidence of harm. This is typical of the biased and one-sided approach taken by the European Commission in its copyright policy, shown most clearly in its dogged support for the Anti-Counterfeiting Trade Agreement — and of the tilted playing field that those striving for fair copyright laws must still contend with on a regular basis. Sadly, it’s too much to hope that the European Commission’s own evidence, gathered at considerable cost to EU taxpayers, will now lead it to take a more rational approach to copyright enforcement, and cause it to drop the harmful and demonstrably unnecessary upload filter it is currently pushing for.

The study actually showed that illegal downloads BOOSTED legal sales of games, books, and music.

You can see MEP Reda’s comments on this whole perfect storm hypocrisy here .

Speaking of Fascism………

The Ukraine has upped its slow-walked ethnic cleansing program, the Ukrainian parliament has passed a law banning non-Ukrainian language education after elementary school:

Timeya Leshko doesn’t see much of a future for her four children in Ukraine, where a Moscow-backed conflict still flares up in the east and economic opportunities seem few and far between elsewhere.

“There’s no way to earn a living here. Everyone knows that. All the young people are leaving,” Leshko told RFE/RL’s Ukrainian Service in a recent interview. “And I don’t think it’s going to get better, only worse.”

The ethnic Hungarian in the sleepy village of Mali Heivtsi on Ukraine’s western fringes, not far from Slovakia and Hungary, is convinced that learning her native tongue is the ticket out for her kids.

But that may be tougher for Leshko and other ethnic minorities in Ukraine after the country’s parliament passed an educational-reform bill on September 5 that includes a clause making Ukrainian the required language of study in state schools from the fifth grade on.

Leshko is not a fan of the bill, which would roll back the option for lessons to be taught in other languages.

“I don’t like it. Why? Because, for example, I am a Hungarian. I was studying in a Hungarian school and I want my children also to speak Hungarian,” she explained. “Maybe they will move to Hungary or maybe they will go there to earn money. In that case, the Hungarian language will be more useful than Ukrainian, I think.”

They want you to leave.

This is what the Quebecois did in Canada, and they have been fairly successful.

And Then There’s the German Elections………

The neoNazi AfD is now a part of the German parliament for the first time cince WWII, the so-called center-left SPD had its worst showing since that guy with the funny mustache abruptly left the Chancellorship over 70 years ago.

Also, the both “center” parties had their worst showing since before 1950.

On the other side of the populist spectrum, die Linke (the Left) which was already in the Bundestag picked up a few seats, as did the Greens, and the (kinda libertarian) FDP, which got back into parliament.

When people wonder why the “Center Left” in Europe is in trouble, they need to understand that it no longer exists.

The parties that were “Center-Left” in the 1960s and 1970s have decided that their defining position is unequivocal and unconditional support for the European Project, and the  European Project is a fundamentally reactionary program.

This is why when the SDP was in power, its leader introduced “Agenda 2010“, with the justification that the European project demands it, which involved:

  • Tax cuts.
  • Cuts to unemployment benefits.
  • Cuts to general social welfare programs.
  • Cuts in pension benefits.
  • Deliberate downward pressure on wages. 
  • Reduced labor regulations.

It also resulted in an increase in poverty, and falling wages relative to GDP.

As is normal, the rising tide did not lift all boats, just the rich getting richer, and everyone else getting the shaft.

What it means is that the “Center-Left” is now about forcing down wages, tax cuts for millionaires, throwing poor people out in the street, and sucking up to media moguls.

The “Center-Left” has consumed itself on the altar of neoliberal dogma.

On the bright side, it appears that a bit of self immolation is occurring with the fascist AfD as well:

Germany’s rightwing nationalist party Alternative für Deutschland, in celebratory mode after coming third in elections, was delivered a bombshell by its co-leader when she announced she would not sit with the party in the Bundestag.
What the stunning success of AfD means for Germany and Europe | Cas Mudde
Read more

Frauke Petry walked out of a press conference on Monday morning at which the party leadership marvelled at its success, having secured nearly 13% of the vote and 94 seats in the federal parliament.

The departure of one of the AfD’s most prominent figures illustrates the splits in the party despite its attempts to show a united front during the election campaign.

Petry, who was on the moderate wing of the party, saw her role as that of uniting the AfD. But she has earned scorn from emboldened rightwing nationalists who have increasingly sidelined their opponents.

This is what happened to Ukip after Brexit.  It’s like a dog that has finally caught a car:  The racist right doesn’t know what to do next.