Category: Good Writing

Quote of the Day

No Comments

Roger Ehrenberg, looks at a number of financial transactions, including the rather mundane one known as leasing nails what should be the core of any reform of the financial markets:

Both cash-market and derivative instruments should be put to the “business purpose” test. Accounting rule-makers, with support of the SEC, should move towards a “principles-based” system where common sense, and not black-and-white rules around which myriad loopholes can be found, should become the new paradigm. But let’s be clear. The issue isn’t derivatives; it’s all financial transactions whose objective is to deceive or to weaken financial transparency.

(emphasis mine)

He notes that a very old transaction, leasing, has been used for the same purpose for years:

Consider leasing, a transaction that has been popular for over 50 years. As the industry has evolved, transactions such as sale/leasebacks and “asset defeasance” have been used to synthetically borrow money without the obligation being reflected as debt on the balance sheet. The form of the transaction: a lease. The substance of the transaction: a borrowing. The multi-trillion dollar securitization industry has the same motivation: moving assets (and liabilities) off the balance sheet, while economic recourse still exists should asset values and/or debt ratings drop. This is what the market discovered when Citigroup’s multi-billion structured investment vehicles (SIVs) began to fail and the assets and liabilities came back onto its financial statements. What is the proper characterization of a contractually obligated stream of payments? Debt. How should a portfolio of assets and associated liabilities be treated if the risks and rewards of ownership haven’t been completely transferred? As never having left the balance sheet. Yet the accounting profession, with the SEC’s support, has enabled this charade to continue.

The idea of a business purpose rule is a very good one.

If Rahm is Gone, What Does It Mean?

No Comments

Cenk Uygur looks at Dana Millbank’s recent big wet kiss to Rahm Emanuel, and concludes that Rahm Emanuel is on his way out:

My second thought was, “Wow, what a hatchet job on Jarrett, Gibbs and Axelrod!” Since Rahm is obviously feeding this to Milbank, that is very revealing. You don’t throw these kinds of bombs unless you’ve already lost. This is an act of desperation. It’s bound to make mortal enemies of these people inside Obama’s inner circle. You can’t really work with these people anymore. That means you’re already finished there.

This is basically Rahm saying on his way out, I was right all along and these guys were wrong. ………

I hope that he is right, but Taylor Marsh sees a bigger picture, and it is scary:

But what if the problem isn’t Rahm?

It’s the question most Democrats can’t, won’t or refuse to face, because they can’t do anything about the answer. Because if they pretend it’s all about Rahm, hoping for his ouster, at least Democrats might get a re-set. With Gibby, Axe, Val and now even Dave still around, it’s better than nothing.”

Rahm Emanuel has some less than savory, and I think downright destructive characteristics, but Barack Obama is not simply some passive actor here; The problems here are clearly Barack Obama’s responsibility, his desk is where the buck stops, but it’s also likely that it’s his fault, and that his missteps on healthcare, stimulus, DADT, Afghanistan, Iraq, etc.

The question is whether these are mistakes, or an artifact of who Barack Obama is.

I fear that this is the latter, because mistakes can be fixed, but if the attempts to make nice and split the difference is at Obama’s core, then we are screwed.

Another Must Read from Krugman

No Comments

He’s talking about free trade and transportation costs, and makes the point that when the costs of transporting goods falls relative to manufacturing goods and services, as they did in the 1870-1913 era, international trade increases, and when the costs of manufacturing goods falls relative to transporting goods, as they did in the era of Henry Ford’s assembly line, pre containerized cargo 1913-1970 or so, international trade falls.

Go read, it’s 599 words well spent.

With the CPAC* Conference Going On

No Comments

The first rule of Investment Banking Club is,
you do not talk about Investment Banking Club.

You generally know where to look for selfishness and an immature sense of entitlement, but Moe Tkacik finds something that makes the folks at CPAC looking like Mahatma Ghandi.

Rather unsurprisingly, she finds it on wall street, where the bankers are, “As mad as hell,” about all the nasty things that people say about them ……… All while sucking down 7 figure salaries and bonuses.

You see, the bankers had a get together, and they invited her:

Still, I had heard of no plan for any sort of public up-close-and-personal plutocrat-on-plutocrat spectacle to give voice to the inchoate counterrevolution, no Millionaire’s March offering group catharsis to the angry wealthy white. But on Tuesday, Jan. 26, I received a mass e-mail from Schwartz Communications with the subject: “Wall Street Strikes Back at White House.”

It was held the trading floor of John Thomas† Financial, and (yet again) it defies belief, but suffice it to say that there was a Republican candidate for the US Senate, the bald guy is the head of the firm, Anastasios (Thomas) Belesis, who is a piece of work all on his own:

Belesis’s FINRA profile is similarly alarming. Investors have accused him of churning, fraud, excessive trading, breach of contract and other violations. Regulators have ordered him to repay investors more than a million dollars.

So, he’s mad as hell, and he’s not going to take it any more.

Of course, in a just world, he would be banned from the securities industry for life.

This story continues with epic tails of sexual harassment and the disposal whipped cream.

Just go read it.

*Conservative Political Action Comittee
†Yes, “John Thomas” is a bit of slang in Britain for a portion of the male anatomy, and it’s very apt here, and yes, there is a real investment bank by that name.

Taibbi On Wall Street (Again)

No Comments

I really cannot do justice to it.

He pens another gem, titled, “Wall Street’s Bailout Hustle,” where he juxtaposes Wall Street and street bunco games, and finds startling similarities:

The only reason such apathy exists, however, is because there’s still a widespread misunderstanding of how exactly Wall Street “earns” its money, with emphasis on the quotation marks around “earns.” The question everyone should be asking, as one bailout recipient after another posts massive profits — Goldman reported $13.4 billion in profits last year, after paying out that $16.2 billion in bonuses and compensation — is this: In an economy as horrible as ours, with every factory town between New York and Los Angeles looking like those hollowed-out ghost ships we see on History Channel documentaries like Shipwrecks of the Great Lakes, where in the hell did Wall Street’s eye-popping profits come from, exactly? Did Goldman go from bailout city to $13.4 billion in the black because, as Blankfein suggests, its “performance” was just that awesome? A year and a half after they were minutes away from bankruptcy, how are these assholes not only back on their feet again, but hauling in bonuses at the same rate they were during the bubble?

The answer to that question is basically twofold: They raped the taxpayer, and they raped their clients.

Just go read it.

Cracked.com Gets Serious

1 Comment

They just listed the, “The 6 Most Statistically Full of Sh%$ Professions, (%$ mine) and they are:

  1. Stock Market Experts
  2. Wine Tasters
  3. Art Critics
  4. Criminal Profilers
  5. Weather Forecasters
  6. Sportswriting

Note that this is not just a slam at these professions. It is a statistical analysis about how they perform relative to random chance.

Stock market experts underperform the market, wine tasters cannot tell the difference between “Grand Cru” and “vin de table”, art critics cannot identify clear forgeries, criminal profilers don’t beat control groups, weather forecasters don’t beat chance, and sportswriters bat about .476 at predicting games.

Just to let you know what it means when you allow non-peer reviewed professions to declare themselves “experts.”

Why We Love the Rude Pundit

2 Comments
Nothing to see here, move along

Because he writes stuff like this:

See, Sarah Palin is graded on the hot chick curve. Men wanna f%$# her and women with low self-esteem wanna be her, so whatever she does just affirms that she is hot and f%$#able and gets to travel. If she looked like Kay Bailey Hutchison, we wouldn’t even be talking about her. Palin knows it. And she wields her sexuality like a distraction while she magically steals attention from those smarter than her.

It ain’t just Palin. Let’s face it: if Hillary Clinton had looked like Sarah Palin, she’d be president. And if Barack Obama had looked like Dennis Kucinich, he would not. But, Jesus, you could argue there was substance there. It’s a sad fact of America in the 21st-century that shallowness is a quality and depth makes you an out-of-touch elitist.

(%%# mine)

He cuts to the core of the issue here: that there are an awful lot of people in the United States who think that the manner of selecting our leaders should involve no more intellectual rigor than selecting Miss Alaska (and by the way, she lost that one too).

Matt Taibbi Nails it Again

No Comments

He discusses the fact that John Thain, the man who spent over a million dollars rehabbing his office at Merrill Lynch while conspiring to conceal losses from Bank of America shareholders has now been appointed CEO of troubled business lender CIT.

Matt Taibbi asks the question that this raises, “Man, exactly what do you have to do to become unhirable in this country? Eat Christian babies on CNN?“

It’s true. As Mr. Taibbi notes, the “Genius” behind the LTCM fiasco is still getting to make his money playing with other people’s money.

This is all about corruption and nepotism.

OK, I Might Consider Donating to Fiorina

No Comments


Rachael Maddow’s take


Full ad

If just because she is an even bigger disaster as a candidate than she was as CEO of HP, where staffers broke out into “Ding, dong, the witch is dead” upon announcement of her firing.

You see, she has followed up the worst political website ever with the worst political ad ever.

I’m beginning to wonder if former HPers are working on her campaign ad just to f%$# with her.

In any case, when one considers her history at HP, where she demoralized and hurt the company but got pay increases, or her history at AT&T, where her staff falsified sales data, she is a poster child for over-privileged senior management, and so would be dead meat on the table in the general.

But right not, she is flinging sheep at Republicans, so she’s doing “God’s work.”

Brutal

No Comments

Stephen Colbert absolutely destroys Harold Ford, who has decided to try to run for Senate in New York, or maybe he’s just looking for a payoff not to run, but he’s been showing just how little he believes in.

He confronts him on his flip-flops, and exposes the fact that he has never voted in New York.

It couldn’t happen to a more smarmy hypocritical lying bastard .

What Krugman Said

No Comments

So says the Shrill One, and so say we all:

Put it this way: if our financial system is so high-strung, so manic-depressive, that low rates for a few years can inflate a monstrous bubble, while a few discouraging words from high officials can send them into a tailspin, this doesn’t make the case that policy must walk on eggshells, forgoing any attempt to fight prolonged unemployment. Instead, it makes the case for much, much stronger financial regulation.

I would only add that one of the metrics that should be used in financial regulation is proportion of GDP. There must be a conscious effort by regulators to keep the financial industry from becoming the tail that wags the dog of our economy.

The Racism of Our Press

1 Comment

Whenever someone flings a shoe at someone as a gesture of contempt, the press seems compelled to note that this action is an Arab gesture of contempt.

As Matthew Yglesias notes, when commenting on a shoe throwing incident involving Sudanese President Omer Hassan Al-Bashir, throwing shoes means, “you suck!” in every society out there:

My continuing question about this shoe-throwing business is in what culture, exactly, is it not the case that throwing a shoe at a guy giving a speech is a sign of contempt? I recall going as far back as when shoes were thrown at Iyad Allawi media types calmly explaining that this is an insult “in Arab culture.” But is the message really so unclear that we needed to break out our handy-dandy Arab cultural translation manual for? I think one thing that makes the shoe-toss such an effective gesture of protest against figures in the global news is that the message is loud, clear, and unambiguous to an audience from any culture. You’re talking to an audience, I’m in the audience throwing a shoe at you—it’s disrespectful.

You see, young Yglesias, the press is, or believes that their audience is, full of racists, and so they feel the need to describe the behaviors of brown people as if they were tour guides on safari.

Olbermann vs. Stewart

No Comments

Jon Stewart called out Keith Olbermann, complete with a Special Comment style rant, and to his credit, Keith Olbermann included the whole bit in his broadcast, and replied, “You’re right, I’ve been a little over the top lately………Sorry.“

I count it as manning up, though his one complaint, that he wants to be interviewed by Stewart, is completely legitimate. It would be a lot of fun.

(8:18)

Best, Satan

1 Comment

A letter to the editor from the Minneapolis Star-Tribune:

Dear Pat Robertson,

I know that you know that all press is good press, so I appreciate the shout-out. And you make God look like a big mean bully who kicks people when they are down, so I’m all over that action. But when you say that Haiti has made a pact with me, it is totally humiliating. I may be evil incarnate, but I’m no welcher.

The way you put it, making a deal with me leaves folks desperate and impoverished. Sure, in the afterlife, but when I strike bargains with people, they first get something here on earth — glamour, beauty, talent, wealth, fame, glory, a golden fiddle.

Those Haitians have nothing, and I mean nothing. And that was before the earthquake. Haven’t you seen “Crossroads”? Or “Damn Yankees”?

If I had a thing going with Haiti, there’d be lots of banks, skyscrapers, SUVs, exclusive night clubs, Botox — that kind of thing. An 80 percent poverty rate is so not my style.

Nothing against it — I’m just saying: Not how I roll.

You’re doing great work, Pat, and I don’t want to clip your wings — just, come on, you’re making me look bad. And not the good kind of bad.

Keep blaming God. That’s working. But leave me out of it, please. Or we may need to renegotiate your own contract.

Best, Satan

(line breaks are mine, the LTE had none)