He is a national treasure.
Author: Matthew G. Saroff
12%?!?!?!?
Analysts at Morgan Stanley have determined that 12% of all mortgage defaults in February were from people who afford to pay, i.e. they were “strategic defaults” from people who decided that their home mortgages were just a bad investment that they needed to walk away from.
If you think that home prices are on their way to a serious rebound, the fact that there are a huge number of people who are far enough underwater that they are walking away, even with the cost to their credit rating and social pressure, should make you pause.
The Shrill One Speaks
He notes that Gordon Brown, in the political fight of his life, should use his actions as Chancellor of the Exchequer to bolster his attempt to remain British Prime Minister:
Really, that should be Gordon Brown’s slogan: “He kept us out of the euro.” And that’s the saving grace of the situation.
True dat.
So Predictable
Because Larry Summers is too arrogant to realize that he will never be Chairman of the Federal Reserve, and because Larry Summers has Barack Obama’s ear,* the White House has all but threatened a veto if the finance reform bill passes with an amendment to audit the Federal Reserve:
Right now Sen. Bernie Sanders (I-VT) is trying to round up 60 or more votes to overcome a likely filibuster and include an “audit the Fed” provision in the Senate’s bill. There are just a few small obstacles: the White House, major financial institutions, and the Fed itself. Their resistance is fierce–but the measure is so popular that killing it will be difficult for them and that, in their eyes, threatens to put a grenade at the center of efforts to to tighten the rules on Wall Street.
The pushback is reminiscent, in a way, of the executive branch’s institutional opposition to oversight of the nation’s intelligence agencies and operations. The Fed has always been shrouded in secrecy, and its leaders (in both the private and public sector) continue to insist on keeping their activities opaque, in order, they say, to protect complicated monetary policy from the political process.
……
It’s likely, in fact, that the Obama administration will be under intense pressure to veto the entire financial reform bill if “audit the fed” survives.
This is nuts. I know that Ben Bernanke will be upset, but to the degree that any voter cares about this, they support this idea, and the audit specifically exempts the inflation fighting functions of the Fed, where independence really matters.
It’s pretty clear that the Fed bent (and likely broke) its own rules, and possibly the law, and we need to know how they handled this, and how they screwed this up in the first place, before we make any decisions on what authority they might hold.
*And Timothy “Eddie Haskell” Geithner’s testicles.
Economics Update
Well, generally good news today, with bankruptcy filings dropping 4% between April and March.
Additionally, there was a spike in pending home sales, though that was likely the now expired home buyer tax credits, and factory rose unexpectedly in March.
In energy and currency, it’s all playing off of Greece, which is pushing the dollar up, which in turn pushes oil down.
Questions that Need to be Asked
Is Every Right-Wing, Anti-Gay Christian Bigot Sucking Off Rent Boys?
I think that the answer is, “Yes”:
That man was George Alan Rekers, of North Miami—the callboy’s client and, as it happens, one of America’s most prominent anti-gay activists. Rekers, a Baptist minister who is a leading scholar for the Christian right, left the terminal with his gay escort, looking a bit discomfited when a picture of the two was snapped with a hot-pink digital camera.
Reached by New Times before a trip to Bermuda, Rekers said he learned Lucien was a prostitute only midway through their vacation. “I had surgery,” Rekers said, “and I can’t lift luggage. That’s why I hired him.” (Though medical problems didn’t stop him from pushing the tottering baggage cart through MIA.) Yet Rekers wouldn’t deny he met his slender, blond escort at Rentboy.com—which features homepage images of men in bondage and grainy videos of crotch-rubbing twinks—and Lucien confirmed it.
Sestak-Specter Primary Battle Closes
| Date | 5/2 | 5/3 | 5/4 |
| Arlen Specter | 48% | 49% | 46% |
| Joe Sestak | 40% | 40% | 42% |
| Undecided | 12% | 11% | 12% |
The latest tracking polls have the Arlen Specter Joe Sestak primary race too close to call.
If you use the rule of thumb that undecideds break against the incumbent by 2:1, Specter still appears to have the advantage, but it is a lot closer than it was a last, when Specter had a 20+% lead, 53%-32%.
I would be surprised if Specter wins by more than 3% when the primary is held in 2 weeks.
Note that the polls here describe Specter’s popularity among Democrats, and he is severely damaged goods, so the general, against the antediluvian Pat Toomey, he will have a very tough road to hoe.
Basically, he switched parties because he wants to stay a senator, and everyone knows it, and it’s unseemly, and no one trusts him, though the Senate Incumbent Protection Program Democratic Senate Campaign Committee (DSCC) is spending heavily on advertisements in his behalf.
This is yet another reason why I implore my readers not to give to the DSCC the DCCC, or the DNC (Post Dean): they are first and foremost an incumbent protection program.
Economics Update (a Day Late)
Click for full size
Miles Driven
Sales of cars and light trucks (the notch is the cars for clunkers program), H/t Calculated Risk
Yesterday was a mixed day for news.
On the plus side, we had:
- Institute for Supply Management’s Manufacturing index rose sharply.
- April auto sales Rose.
- Personal spending rose for the 6th straight month.
On the minus side:
- Private construction spending fell in March, though overall construction spending rose because of public spending (stimulus).
- The latest Fed survey shows weaker loan demand, even though banks were not tightening lending standards.
Additionally, we had US Treasurys falling, and their yields rising, but that is largely on reduced concerns about Greece following the successful implementation of a bailout package.
OK, Maybe Not Getting the Washington Post Gig Wasn’t So Bad
I while back, I applied to, and did not make the cut for, the Washington Post‘s America’s Next Great Pundit contest.
Maybe it was the best outcome, though I could use the money, because it appears that the paper is now going to blogs and asking for links to their blogs post, as well as the authority to give said bloggers their assignments, for the princely sum of $0.00 (€0.00):
Five weeks ago, I received an unsolicited offer from the Washington Post. They asked if they could post my picture and biography on their website and link to every new blog post appearing here if I agreed to produce regular original content for them at their request. I turned them down. Why?
Because they wanted me to work for them for nothing.
The Post is organizing a “local blogging network” linking to selected blogs from their website and asking bloggers to submit original content, which would be edited by them. The Post’s rights to that content would be enforceable under a written agreement. That agreement was written as follows:
…………
The Post is also demanding the, “non-exclusive right to republish the Work (in whole or in part) on the Site in real time simultaneous with Your own publication of the Work, as well as the right to adapt, edit, display, store, and promote the Work in connection with such republication on the Site.”
This deal sucks worse than a coupon for a week of sessions at John Boehner’s favorite tanning salon, though it might not suck worse than a coupon for two weeks at John Boehner’s favorite tanning salon.
Deep Thought
Click for version with full “f-bomb”.
You Keep Using That Word. I Do Not Think It Means What You Think It Means.
It appears that BP neglected to take precautions on the oil platform, because, “BP did not build containment devices before disaster because it ‘seemed inconceivable‘ the blowout preventer would fail.”
Tell me that this is not an Inigo Montoya moment.
OK, Maybe it Wasn’t a Glenn Beck Fan
It appears that authorities are looking for a person of interest with extensive ties to Pakistan regarding the abortive bombing attempt on Times Square.
It is, of course, terrorism, whether it’s an Pakistani-American, or someone who can trace their lineage back to the Mayflower, because, after all, blowing up a bomb in Times Square is terrorism.
The question now is whether it was Mayflower type, or someone with ties to the Islamic world.
In either case, it was someone who did not know how to do it right, so we can pretty much cross off going to one of those al Qaeda training camps, because he clearly did not take IED making 101.
A Thought on Barack Obama’s Most Likely Supreme Court Choice
Current Solicitor General, Elena Kagan, is on the short list to be the Supreme Court Nominee to replace John Paul Steven.
She has a long and distinguished record, though she has never been a judge.*
Perhaps her 2nd most prestigious position, after being Solicitor General was as Dean of Harvard Law School, where she made special efforts to “broaden the ideological diversity” of the institution by hiring conservative legal scholars.
Needless to say, this sort of thing would clearly play well with Obama, who has clearly drunk his own Koolaid on his post-partisan thing.
The thing is, her definition of “diversity” is pretty narrow, and it appears taht she did not hire minorities or women:
Granting that we know very little about Kagan, what do we make of the facts that we do know? Here are some data that gives me pause about Kagan. When Elena Kagan was Dean of the Harvard Law School, she hired 29 tenured or tenure-track faculty members. But she did not hire a single black, Latino, or American Indian faculty member. Not one, not even a token. Of the 29 people she hired, all of them with one exception were white. Under Kagan’s watch Harvard hired 28 white faculty members and one Asian American.
One of Kagan’s purported qualifications for the Supreme Court is that she is a consensus builder. The chief evidence for that contention is that she broke the hiring logjam at Harvard and made it possible for Harvard to hire conservatives. It might sound absurd to some, but I will accept the point that one of Kagan’s chief selling points is that she assured that Harvard did not discriminate ideologically. I am personally gratified that Harvard Law School is not closed to conservative faculty members. I support ideological diversity and would not want to see qualified individuals discriminated against on the basis of ideology.
But what about people of color? How could she have brokered a deal that permitted the hiring of conservatives but resulted in the hiring of only white faculty? Moreover, of the 29 new hires, only six were women. So, she hired 23 white men, 5 white women, and one Asian American woman. Please do not tell me that there were not enough qualified women and people of color. That’s a racist and sexist statement. It cannot be the case that there was not a single qualified black, Latino or Native-American legal academic that would qualify for tenure at Harvard Law School during Elena Kagan’s tenure. To believe otherwise is to harbor troubling racist views.
I am unaware of the dynamics at Harvard Law School, but having a stepmother who is both a former college president, and a Harvard grad, I do know that the politics at Harvard can be unpleasant, and produce less than optimal results.
Still, 28 hires, 27 of whom are white, and one of whom is of Asian extraction seems to me to indicate some very real issues, whether it’s just conflict avoidance/cowardice, or something more.
It seems to me that in an environment like Harvard Law, hiring 28 faculty and hiring only 1 non-white actually takes a lot of work.
H/t BTD.
*I think that the practice of appointing Federal judges is overrated. Every current justice was a Federal judge, which was not the tradition. The last non Federal judge appointed was O’Connor, and you have people like Warren, Douglas, Fortas, Marshall, Brandeis, Black, Frankfurter, etc., as well as people like Holms and Cardozo, who were judges, but not Federal judges.
Well, Here is a Blast from My Web Past
Around 1995 0r so, I really do not recall when exactly, I decided that the web was just too useful for me to compete on utility, so I would compete on uselessness.
So I created, hand coded, because that was the way then, a web page dedicated to bad hair days.
Originally, it was just me, you’ve seen the picture, it’s in the right column, and Al (Einstein, that is, the patron saint of bad hair).
Well, I realized that not only did the Internet completely out-class me in useful things, but it completely outclassed me in useless things, so it never went that far.
That being said, I did add one other public figure, just 12 days before September 11, 2001, James Traficant, who had arguably the worst hair in the 200+ year history of Congress.
Mr. Traficant was subsequently tried and convicted for matters unrelated to his hair, corruption, and expelled from Congress.
Well, He’s back!!!!!!
After serving 7 years for bribery, he is running for his old seat as an independent in his old district in Youngstown, OH.
Same as it ever was……
Federal Reserve Continues Its Full Court Press Against Transperency
Once again the Fed is trying to cover up its role in bailing out the financial bigwigs.
I think that they know that they will lose if it goes before the Supreme Court, so they are delaying in the hope of getting a “Get out of jail free” card from Congress in the financial regulation bill.
Their latest delaying tactic is that, after having lost at the Federal district and appeals courts, they are asking for an en banc (Full Appeals Court) review:
The Federal Reserve Board asked an appeals court to reconsider a ruling requiring the agency to disclose documents identifying financial firms that might have collapsed without the largest U.S. government bailout ever.
Attorneys for the Fed yesterday asked the full U.S. Court of Appeals in New York to reconsider a unanimous ruling by a three-judge panel. If the court refuses, the Fed can appeal to the U.S. Supreme Court.
“The decision is of exceptional importance,” the Fed’s lawyers wrote in a legal brief. “The real-world consequence of the panel’s decision will be serious, perhaps irreparable harm to the institutional borrowers whose information will be revealed.”
Nope. Everyone knows this information by now.
What they don’t know is just how much the Federal Reserve Bank of New York, and the Board of Governors of the Federal Reserve, are in the pockets of the financial industry, and how far they went to protect their buddies in Wall Street.
It’s time for the Fed to man up and fess up.
Entering the Last Decade
I’ve hooked up a webcam, and installed Skype.
I just confirmed that it worked with my brother, who uses both a lot, he has a D&D run that involves players from the west coast and China.
I’ll be having a video interview some time this week.
Daniel’s advice, “Remember to look at the camera.”
My Skype ID is “msaroff.”
5,113
The number of nuclear warheads currently in the US inventory.
This is the first time that the number has been released, and it is well down from, “22,217 in late 1989.”
This does indicate a modicum of compliance with the NNPT, which requires nuclear powers to draw down, and is good news.
Felix Salmon on Robert Rubin
It’s a beautiful and well deserved take-down of the man who deregulated derivatives and took hundreds of millions of dollars from Citi and let them drive themselves into the ground.
Just go and read it.
More Evidence of Chinese Naval Ambitions
The Chinese Navy is building a 2nd demagnetization facility at Maocao Nong.
This is significant, because while ships may be flashy and show the flag, you need support infrastructure in order to be able to maintain a reasonable level of operations, and this is yet another example of how the Chinese are building their naval power from the ground up.
On a related note, it’s amazing what you can find on Google Earth.
Greece Bailout Finalized
The bottom line is €120 billion in loans and guarantees, along with some fairly brutal austerity measures.
Of course, the problem is not that the Greek government is profligate, it has amongst the most meager safety net in the EU, but rather that the populace aggressively evades taxes, and the tax collection authority is inefficient and corrupt.
Estimates have the Greek government, “losing as much as $30 billion a year to tax evasion.”
The solution here is very simple. While the German people may object to lending money to the Greeks, which is one of the reasons that Angela Merkel dithered, I don’t think that the German people would object to lending a few hundred to a few thousand of their nastiest most aggressive tax collectors to Greece.
As it stands not, Greek austerity is being carried on the back of the lower and middle classes, while the wealthy will continue to avoid paying their share. Only a few thousand of the 11 million Greeks claim an income above €100,000.00, and this is clearly not true.