Frozen Arctic Tundra

1000% committed to snarkiness

2012-01-10T14:59:00.001-06:00

Our former CEO of Thomson Reuters Markets was a Financial Times Guff award winner:

Rehypothecation and why everyone should know at least one Romance language

2011-12-10T15:27:00.000-06:00

Courtesy of the ZH commenters on the re-hypothecation wheeze gradually being discovered by public. At least the financial services public, who hopefully are getting this news out to the non-finance public.

[Spanish] hipoteca = mortgage

On Wednesday, 7 December 2011 Christopher Elias of Reuters dropped this bombshell:
MF Global and the great Wall St re-hypothecation scandal

I'm still trying to wrap my head around the implications of London's no-holds-bar on re-hypothecation, which I understand to believe that collateral can be pledged ad infinitum. And because of that rule, MF Global shifted customers' collateral to its London branch to take advantage of that. And because of that, the money wasn't stolen (it was, but rules and venues changed to cover the practice under the letter of the law) but LOST. Like losing money at the blackjack table.

And you didn't even know you were gambling. Have you figured out you're part of the 99% yet?

S&P gets okay to warn six European countries on downgrade

2011-12-05T13:49:00.000-06:00

(Reuters) - "Standard & Poor's has warned Germany, France and four other AAA-rated euro zone countries that they might get downgraded in the next 90 days, the Financial Times reported on Monday.

S&P is poised to announce later on Monday that the credit ratings of those six countries -- which include the Netherlands, Austria, Finland and Luxembourg -- are in credit watch negative, the FT said in a story published on its website."

So somebody gave the big green GO to S&P to do some saber-rattling. And at the time of this writing, the market went from up 140 to up 60. But yet, still up on the day. Go figure.

Meanwhile, Europe saw this one coming and started making noises in October that sovereign debt shouldn't be rated.

[WSJ] EU Wants Ratings Firm to Relent on Troubled Nations
BRUSSELS—The European Commission is leaning toward proposing a ban on the issuing of sovereign credit ratings for countries in bailout talks, a top official said on Thursday.
"I think it's legitimate to have a special treatment when a country is in negotiation or is covered by an international solidarity program with the IMF or a European solidarity" program, said Michel Barnier, European internal market commissioner.

Mr. Barnier, rationalizer par excellence.

How I Balanced My Budget, or, I'm Finding New Revenue Streams

2011-11-09T20:47:00.000-06:00

Mentors are all around. The press* reports on them constantly. You have to willfully run away from the inspirational stories.

Mentor #1: City of Chicago. A daunting deficit is to be laughed at, ignored, and of course dined-and-dashed on the government scale. In other words, stick the citizenry with the tab.

Suggestion #1: Get the scofflaw dog owners. Animal Control and Care Commission estimates only 5% of dogs have licenses. They. Must. Pay.
Fines could range $20 to $200. The license is $5. People are already paying a $6 tax per rabies shot, per year.

Suggestion #2: Those people who don't shovel the sidewalks? Get them. Ald. Tunney (44th) proposed fining homeowners who don't clear their sidewalks. And for the ones who drop dead while doing so, the estate will be charged for that removal too.

Suggestion #3, and well on its way to reality: Speeding cameras. Red light cameras were such a revenue hit, let's ramp it up. Illinois Senate and House dutifully passed Mayor Emanuel's bill.

Suggestion #4: Just one city sticker per year. And make it the current year's sticker. None of this 2-3 old stickers on the windshield, turning it into a hangout for the City Sticker Gang. Or pay $120 fine for improperly displayed sticker.

Mentor #2: Cook County. Toni Preckwinkle jumped from City Council to Cook County. It's difficult to determine if it was a jump up, down, or lateral.

Suggestion #1: Make those slack-jawed unincorporated losers pay for the police protection they don't get. $150 a year.

Suggestion #2: Leave no sin tax unhiked. True to form, Preckwinkle proposes another $0.50 on the hard stuff. The current state/county/city troika on liquor taxes makes Chicago the highest-taxed city in the nation. We're Number One!

Suggestion #3: Get them in their civic duty. Charge for parking at the courthouses. About time the country recouped that $17.14 paid out to jurors. Say, we might even come ahead on the deal!

Suggestion #4: Can't believe we forgot to tax these: billiard tables. And jukeboxes.

Suggestion #5: Don't fail to kick a sucker when he's down. Jack the use tax on sale of titled property, such as real estate, cars, and boats.

Mentor #3: State of Illinois. In the great Combine of Illinois, two legs pay taxes, four legs don't.

Suggestion #1: Raise the personal and corporate income tax, then let big corporations negotiate a lower tax rate. Equal under the law - ha!
*Personal went from 3% to 5%; Corporate from 4.7% to 7%.

Suggestion #2: Don't raise the sin tax - raise the sin activity level. Springfield is trying to pass a gambling bill omnibus. A little something for everyone: a city-owned casino for Chicago; slots at horse tracks; 4 private casinos for the rest of the state.

This entry will be updated as more examples come pouring in. And taxed appropriately.

*The corporate press, that is.

Occupy Chicago, aka Occupy LaSalle Street

2011-09-29T12:40:00.001-05:00

Here’s what I’m doing to help Occupy Chicago:

I work in the Chicago Federal Reserve building but I do not work for the Fed, and Occupy Chicago is camped out right in front on LaSalle Street.

I make a point to encourage and talk to as many protesters when I enter and leave the building. I then immediately engage in a little small talk with Fed (armed) security, to drive home the point that I support these guys. I also prominently wear my Fed building ID and company ID (and if they want to think I’m with the REUTERS news arm of the company, so much the better).

Taking a page from Michael Rivero's book, I have pizzas delivered to the protesters. I hope they like Giordano’s because they’re a block down the street.

I printed up 10 copies of A) ACLU’s “Know Your Rights: Photographers”, B) ACLU’s “You Have Every Right To Photograph A Cop”, and C) Reason.com’s article on the Illinois State Court throwing out the charges against Michael Allison and distributed to the campers. It's one thing to know your rights, it's another to show them in writing to law enforcement.

I also use chalk to write slogans throughout Chicago’s financial district. My current favorite is Vichy Chicago, but friends keep telling me it could be misinterpreted as “Viva Chicago.”

Chicago’s Fed is at LaSalle and Jackson, across the street from Bank of America (in the old Continental Bank of Illinois – how apropos) and the Chicago Board of Trade/Chicago Mercantile Exchange. It really is Chicago’s Ground Zero.

I’ll be there on Sunday, 2 October 2011, and if I get any great footage I’ll post it.

Maybe the CPD manpower shortage isn't as acute as we thought

2011-09-28T22:27:00.000-05:00

Chicago's Police Department is so understaffed that Rahm Emanuel made it a campaign issue. Why, if he were elected he'd put another 1000 cops on the street.

On 14 September 2011, Sun-Times reporter/columnist Mark Brown noted:

At least half the police officers that Emanuel and Police Supt. Garry McCarthy have redeployed since May to help them say they’ve met that goal were already working ON THE STREET fighting crime.

Mark Brown doesn't note, however, that CPD's union contract permits full-paid time off of 12 months out of every 24 month period. Colleagues of mine thought that statement couldn't possibly be true. I agreed - it seemed hyperbolic. So I went to the current FOP contract:

Section 18.2 — Non-I.O.D.
Any officer absent from work on account of non-I.O.D. injury or illness for any period of time not exceeding twelve (12) months in any twenty-four (24) consecutive month period, shall receive full pay and benefits for the period of absence, provided such injury or illness is certified by the Medical Services Section. Such certification shall not be unreasonably withheld.

I.O.D., incidentally, is injury on duty. That is covered in a preceding section.

Maybe if the cops had sick leave allowances that were reality-based, the manpower shortage wouldn't be so acute.

Sun-Times round-up for Thursday 22 September 2011

2011-09-22T21:47:00.000-05:00

Is today the first day of fall? No. Tomorrow, Friday, 23 September 2011 is. So I overslept today on the last day of the year with more than 12 hours of sunlight. Curses.

And now, on to the Sun-Times round-up.

Tony Bennett found a very mild way to express his feelings of 9/11 and got lambasted for it. Oh, the online version has excised the actual comment! Checking the print edition - they don't have it either. Here's the incendiary lines:

"They flew the plane in but we caused it," ... "Because we were bombing them and they told us to stop. Are we the terrorists or are they the terrorists? Two wrongs don't make a right."

Buried on page 25 is this: U.S. House kills spending bill with disaster aid. The bill included $3.7 bn for disaster relief (read: $3.7bn for FEMA) and rejected 230-195 in a coalition largely made up of Democrats and Tea Partiers.

[Ed. note: This, by the way, is what they're blaming the market tanking on. The DOW was down 391.01 (-3.51%). This would mean that Asia & Europe plunges were also due to this, which is farcical.]

Maybe the markets plunged on this: O'Hare $8 car rental fee may rise to help fund more parking. The good news is that L.A. travelers are extorted for an $18 rental car fee. The bad news - well, let the article lay it out for you:

At the time, officials described the $8 "customer facility charge" as a starting point and said the fee would go higher if the people mover system was extended to the new rental car campus instead of simply consolidating the companies' shuttle bus operations.

Wunderbar. With TSA goons staffing every airport do they really think airline travel is going to increase? (Leading to the mythical car rentals, natch.)

Down at City Hall, Ald. Burke in a bid to stay covered by the press echoes "Top cop has power to close stations." From the article:

The chairman of the City Council’s Finance Committee acknowledged Wednesday that Police Supt. Garry McCarthy could “unilaterally close police stations” without City Council approval and said Chicago’s financial crisis is “so dire” that the closings must be considered. . . Former Mayor Richard M. Daley once embraced a consultant’s proposal to close seven police stations to free 400 officers for community policing, only to abandon the idea and start building new police stations.

Starts to paint a picture on why the city is a microcosm of how f*cked the country is.

And then there are the Cook County Commissioners. They voted 17-0 earlier in 2011 to take 5 furlough days and 5 shutdown days - 10 days without pay. But now that the end of year is nigh, William Beavers and Earlean Collins don't want to take them. Beavers asserts that the state Constitution bars any reduction or increase in a sitting official's salary. Not sure about that, but if that's true then Beavers & Collins should be indicted for fraud since they knowingly voted for a bill that was illegal, with no intent to fulfill their duty. And if they used a buzzer to vote, get them on wire fraud.
[Update: Fellow Democrat commissioners Murphy, Sims, and Steele have now joined Beavers & Collins in repudiating their 26 February 2011 vote to take 10 days w/o pay.]

Back to the city, new head chosen for the CHA. And he's from Charlotte, NC. Emanuel is sticking to policy of hiring people from outside Chicago. Way, way, way outside Chicago. (Cf. Jean Brizard, Gerry McCarthy.) Don't know what his qualifications are, don't care.

And a Chicago cop story to round it out: Cop's lie made woman miss sister's burial.
Debra Green's sister passed away and she was in the funeral procession to the cemetery. Officer Sylshina London was late for work and weaving in and out of the procession. When Green called her on it, London radio'd 10-1 (officer in need of assistance) and claimed Green threw a bottle at her and hit her in the head. A CPD blue light camera contradicted Sylshina's claim. Now SHE'S charged with felony perjury for lying in Green's trial. Neighbors said Sylshina moved to North Carolina.
Delightful.

One last thing. Richard Roeper's column today addressed the two American "hikers" who were released by Iran this week. His insipid headline: Hiking near Iranian border probably not good idea.

I know: they’re not the only American civilians to have visited Northern Iraq. We’re told Iraqi Kurdistan is safe for tourism and people are welcoming to Americans. It’s the “other Iraq,” as many websites put it, a “popular tourist destination for people living in the Middle East.” The hikers were experienced world travelers. Bauer and Shourd were living in Damascus. Bauer is fluent in Arabic.

"We're told Iraqi Kurdistan is safe for tourism?" Who is the "we" there? After thinking this over, I think it's Roeper that's the idiot and not that he's taking his readers for one. Although his regular readers probably are.

The Republic of Iran says they illegally entered the country and engaged in espionage. Bauer is a journalist. Fattal is an environmentalist and teacher. Shourd, who has battled serious health problems, is an educator and social worker.

Hold on. On those alleged vocations, and health issues, and two are living in Damascus, and they're hiking in IRAN? And one's fluent in Arabic? That doesn't stink of intelligence assets?

Indian train goes wrong way, no one notices

2011-09-20T21:23:00.000-05:00

An allegory of every U.S. company betting on India.

Indian train travels 980km in wrong direction

As the packed service pulled into the Indian city of Warangal people on board went berserk as they realised they were five hours away from where they should have been and no staff on board had noticed.

9/08/2011 Round-up on Sun-Times columnists

2011-09-08T13:11:00.000-05:00

Lynn Sweet's column in the paper is headlined "The tax break you don't know you have."

From the article:

No one I’ve asked over the past few months can tell me the amount of cash Obama has put in their pocket. And it’s clear the people I’ve been chatting with — friend and foe of Obama — had no idea they were getting a tax break. Maybe it’s a result of so much direct deposit that people don’t study pay stubs anymore or a matter of financial literacy or confusing messaging from the White House.

The online version changed the headline to "Obama's jobs speech to pitch extension of payroll tax cut." Maybe that's because someone pointed to her that at the same time the payroll tax was cut by 2% Illinois jacked the income tax 2% so no, Lynn, there was no change in our paychecks.

Oddly, I couldn't retrieve Roeder's column today, "Markets Hop on Hope." He attributes yesterday's market to the announcement that Obama will announce a proposal for a jobs package. Not one word on the German court capitulating on the bail-outs.

From the 9/07/2011 Sun-Times: Cops Crack Down On Phony Sick Leave

Chicago cops have a generous medical-leave policy. Under their contract, they’re allowed 365 days of sick leave every two years.

Ich bin ein Scmuck.

DTCC, OCC stand pat on U.S. Treasuries

2011-08-07T18:12:00.000-05:00

Timmy Geithner reassures the President, and by extension the country (presumably) that he will NOT resign. Strangely, DTCC and OCC haven't reversed course on their U.S. Treasuries as collateral position.

OCC
O[ption] C[learing] C[orporation] said today it has no current plans to adjust its current valuations or haircuts on Treasury Securities used as collateral in light of the Standard & Poor's rating change on U.S. sovereign debt.

DTCC
The Depository Trust & Clearing Corp. told traders that its Fixed Income Clearing Corp. subsidiary would not immediately require more Treasurys to be posted to maintain required collateral levels for outstanding trades, signaling that one of the biggest U.S. clearinghouse operators did not anticipate a dramatic slide in the value of U.S. debt following the S&P downgrade.

The chips are falling

2011-08-06T16:37:00.000-05:00

A casual trip through Zero Hedge alerted me to the fact that Germany won't commit 133% of their GDP to save Italy, let alone Spain.
So, I reacted the way I usually react: find the supporting articles from mainstream publications and throw the links up on Facebook with semi-snarky commentary.

Here are the three (3) I threw up in quick succession Saturday afternoon.

[Spiegel] Germany: Italy too big to save

My comment: The New Zealand Stock Exchange opens 8am Monday, 3:00pm Sunday Chicago time.

[Telegraph] G7 ministers to hold emergency conference this weekend

My comment: This man is lying: Francois Baroin, France's finance minister, who would chair such a meeting under the French presidency of the G7 and G20, said in a radio interview it was too early to say whether there would be an early G7 meeting.

And finally, this:

[The Australian] Europe reels as MPs split on crisis

My comment: "Mr Trichet said mounting speculation that Italy would be unable to pay its share of the second Greek bailout package was ridiculous." There is nothing ridiculous about bankrupt countries bailing out other bankrupt countries. *The U.S. through the IMF is also bailing out European countries.

Game on!

S&P Said They Were Going To Do It. And They Did It.

2011-08-05T21:49:00.000-05:00

Way after market close on Friday, 5 August 2011, S&P downgraded the U.S. from AAA to AA+.

In other news, I think I deciphered why the White Sox mega-suck this year (although they managed to beat the Twins 5-3 at Minnesota tonight). They're part of the Resistance, trying to overthrow the Vichy Chicago regime.

The First Rule of Panic: If you are going to panic, do so before everyone else does.

2011-08-05T12:17:00.000-05:00

Northern Rock bank run, September 2007.

The South Shore Sinkhole ate the stock market

2011-08-04T20:08:00.000-05:00

Not a great day in the markets,and if you want me to be more specific than not a great day in ANY market. Every flipping bourse closed down, down, down doobie down.

Reuters: Wall Street suffers worst sell-off in two years
FT: Global stock sell-off accelerates
Bloomberg: Japan stocks plunge most since March amid global equities rout
Bloomberg resists the urge to use "sell-off."
IBD: U.S. stocks pummeled on economic worries
The Guardian: Police raid Milan offices of Moody's and Standard and Poors
Sydney Morning Herald: Black magic behind sharemarket carnage
From this article: After the ASX opened today, shares fell 4.4 per cent on the All Ordinaries Index, or 192.3 points, to a two-year low of 4160.6. The dive adds to the $65 billion or so lost since Tuesday.

So that's good news. The rapine of stock markets continues, rolling west from PacRim to Europe to Americas to PacRim again.

Oh, and gold & oil sold off. Margin calls.

Meanwhile, the South Shore Sinkhole at 70th Street and Oglesby is growing. That Sheltie in the lower left corner better be careful.

Beware of Greeks bearing yogurt

2011-08-01T08:10:00.002-05:00

I found out that you should never have super-fiber oatmeal and Greek yogurt in the same meal unless you want to be incapicated 6 hours later.

The July 18 2011 round-up

2011-07-18T13:12:00.000-05:00

The Murdoch/media empire story not only has grown legs, but is jumping hurdles like an Olympian.

A whistleblower, former News of the World reporter Sean Hoare, was found dead today (10:40am GMT). The UK Guardian reports "The death is currently being treated as unexplained, but not thought to be suspicious. Police investigations into this incident are ongoing."

Just like Gary Webb and Hunter S. Thompson committed suicide.

The two top London cops got off comparitively easy - they resigned. BBC reports: "The Met has lost its highly respected Commissioner, Sir Paul Stephenson and its top counter-terrorism policeman, Assistant Commissioner John Yates, who have both resigned over the phone hacking scandal."

Meanwhile, on this side of the Atlantic Egan-Jones downgraded U.S. debt. Gold is at 1603.9 and silver at 40.295 at the time of this writing. Equities and bonds are both selling off: DJIA at 12,350.65, -128.70. The 30 year US Treasury is at 125 13/32, down 20/32. (When the price goes down, yield goes up.)

And Bank of America (BAC), ahead of their Q2 report Tuesday, 7/19/2011, admits it needs to raise capital and therefore will not increase the dividend. The stock is at 9.73, down only 0.27 on 165.42 million shares traded. Nothing nefarious going on there.

And Goldman's Sigma-X platform is showing UK banking stocks under attack, just like Italian banks were under attack 3 weeks ago.

The Soxo-Twin War of 2011 Continues

2011-07-08T22:33:00.000-05:00

Live blogging the Friday 8 July 2011 Twins-Sox game.

1st inning, Twins go up 1-0. I couldn't take it and turned to the Mary Tyler Moore show on 26.3 (MeTV). Turned back to see Konerko drive Alexie Ramirez in with a double. PaulStar! Then I stuck around and saw Adam (Grand Canyon) Dunn hit a monster home run to right center. Now Quention hits a double. 1 out. His 25th double.

I'd like to see a 20-1 game to ease that debacle I saw in 2009. Criminy.

7:30pm Bottom of 1st, mound visit by Twins pitching coach. 3-1, Sox.

And it's fair - Rios doubles, bringing in Quentin. Yes! They get AJ to bounce out to 2nd, moving Rios to 3rd. And there's a base hit for Beckham, bringing in Rios.
5-1, Sox.
And Beckham steals 2nd during Morel's at-bat.
Oh yeah, and it's still the first inning. Morel grounds out to shot but the Sox put a crooked number up.

Gavin Floyd #34 is pitching. Let's hope he keeps focus and doesn't mentally wander through the poppy fields.

2nd Inning - top
Ah jeez. Floyd walks a dude after giving up a hit.
Strikes out Tolbert. Whew.
3rd out is a grounder to Floyd. Take that, Twinkies.
bottom
You know what the problem with live blogging is? The internet is beckoning you from the other browser tabs.
Two outs, no runners. PK is up to bat again. PaulStar! *He won the Final Man vote for the All-Star game in Phoenix. It works out since he was going home for the All-Star break anyway. And this is the 3rd time a Sock has won the Final Man vote: Podsednik in 2005, AJ Pierzynski in 2006, and now PK in 2011.

And Konerko singles this time. And Dunn strikes out. Everything's back to normal.

3rd Inning
I'm taking a slight break to catch Bob Newhart on MeTV.
8:13pm Commercial break, switched back to the game. Bad news - still top of the 3rd. Bases loaded. 2 out. For crying out loud. And I can't get my bottle of Blue Goodness open. A budding catastrophe.
Sweet pickup by Morel and the side is retired.
5-2, Sox.

8:22pm Commercial break, switched back to Sox game. They're on a commercial break too.

Sweet Moses, it's the top of the 4th, still 5-2.

8:27pm Bob Newhart is over. Switched back just in time to see Floyd plunk ?, to load the bases. Cooper's at the mound and he doesn't look happy. And he shouldn't. I'm not happy. Floyd is 4-9 lifetime against Minnesota. Yuck. Twins are 8-0 for last 8 games played at Comiskey. Come on.
Cuddyer gets a base hit, one run in.
5-3, Sox.
Strikes out ?. Who cares. Got a Twin to strike out. Bases still loaded, 2 outs.
Twins drive in 2 more, to tie the mother-flipping game, fans are booing, and Floyd's getting the hook. #77 Will Ohman's coming in. Still 2 outs.
5-5. Awesome.
Ohman breaks the ice by giving up a home run - 3 runs score.
5-8, Twins. Now I have to focus on what I'll enjoy at Sunday's game because clearly it won't be the overall game.
And finally this nightmare inning is over.
Box score
Twins 8 10 0
Sox 5 5 0

Pathetic. And no Newhart to pull me away from this.

8:48pm Bottom of the 4th. Just a note - this game started at 7:10pm. So it's going to be slow and painful.
Minnesota SP Blackburn's got to be relieved.
Meanwhile, Max has rethought his position on raw eggs. He likes them. Too bad for him that Flurry knew from the get-go she liked them and licked the bowls clean.
#1 Juan Pierre singled, #10 Alexei batting.
Max just realized there's a baseball game on (this means he rushes the TV and barks).
Infield-bleeping-fly rule. For chrissakes.
PK's up. Blackburn's on pitch 87. In the bottom of the 4th. And it's 8:58pm. I would be close to suicidal if actually at the game.
Walked PK. Adam "Grand Canyon" Dunn is up. Two outs. Please god don't let him strike out AGAIN.
I'm diverting myself by reading up on vitamin and mineral supplements. My back-up American League team, for seasons such as this when the Sox closely resemble an extinct sulphur pit - smelly and useless, is the Cleveland Indians.
Stone is commenting on the Human Rain Delay, Nick Blackburn. And Mauer takes his time sending the sign. I hate Minnesota so much.
I couldn't take a Dunn strikeout. I flipped to "My Name Is Earl" on WPWR.
Naturally, it's a commercial break so I go back to the game and it's a commercial break too. So my plan worked - I missed Dunn's strikeout. (I just checked GameCast - Dunn did strike out, swinging.)

9:12pm The good news is that the Twins haven't scored any more runs. Of course, neither have the Sox. And it's the top of the 5th. There's going to be a spike in the suicide rate tonight.
Sox pick off a wandering Twinkie, and finally the top of the inning is over.

9:30pm Should I flip back to the game? Sure, I'm a gambler. Top of the 6th, still 8-5 Twins. For gawds sake.
9:59pm Well, I'm back to the Sox game. And it's a commercial break.
Cleveland lost to Toronto. Crap. Detroit's beating Kansas City. Who cares.
And that's that. 3 up, 3 down and off to the 8th inning.

10:27pm Going into the bottom of the 9th. And it's still 8-5, Twins.
10:32pm This game is o-vah. Call it!

Twins 8
Sox 5

Bonds are forever, but the ratings don't have to be

2011-07-06T13:57:00.001-05:00

Moody's, belatedly, is gettting real on ratings reviews of sovereigns and the EU is not happy about it.

Greece was downgraded to JUNK by Moody's in June 2010.

Portugal got their rating whacked today*. Spain and Italy were put on notice.
*From Baa1 to Ba2. Not impressed? Who can be with raters and their archaic hoodoo voodoo.

Ireland is one grade above JUNK (what is that, Junk+?).

[BusinessWeek] Moody, which slashed Portugal to Ba2 from Baa1, in April lowered Ireland’s credit rating to the lowest investment grade Baa3 and left country’s outlook on negative.

For comparison, let's see how Iceland is doing.

[Bloomberg] The credit rating companies that were too slow in predicting Iceland’s economic collapse in 2008 may be underestimating the strength of its resurrection.

Fitch Ratings said in May it may take two years for the island to shed its junk status, while Moody’s Investors Service and Standard & Poor’s give Iceland their lowest investment grades. That hasn’t deterred investors from trying to buy twice the amount offered in last month’s $1 billion bond sale as the island returned to global capital markets less than three years after its banks defaulted on $85 billion in debt. "When you look at how successful that auction was, it's clear that investors are now crunching the numbers themselves and that the credit grades from the rating agences are less relevant," Valdimar Armann, an economist at Reykjavik-based asset manager Gamma, said in a July 4 interview.

Possibly the EU is drawing the wrong lesson from the Iceland story. No, no - I jest. They want to bury Iceland. How dare they recover!

Keeping it simple

2011-06-19T10:15:00.000-05:00

From the UK Telegraph

Today's posting is action oriented. Get some chalk and write your protests everywhere.

For my part, I'm chalking downtown Chicago with "Vichy Chicago," "Outlaw The Fed," Up The Republic," and "Nobody Expects the Spanish Revolution." That should go over well at Taste of Chicago time, in a week.

I got the last one from signs I saw in the Puerta del Sol Square protests in Madrid, Spain.

The CIA coup prior to JFK's assassination

2011-05-07T12:43:00.000-05:00

Try this on for size:

May 1 1960 Gary Powers crashed in his U2 near Sverdlovsk, 1200 miles inside Russian territory.

It was reported that the Russians shot the plane down, but photographs show no such damage. Fletcher Prouty writes in "The Secret Team" that the plane did not get its full allotment of hydrogen, necessary to power the engines at 60,000 feet. It stalled and forced Powers to land within Russian territory.

Why? Well, let's take a look at what happened in the wake of the U2 incident.

Eisenhower's long-planned Peace Summit, scheduled for May 16 1960, was scuttled.

How handy for the military industrial complex that Powers' U2 crashed/shot down two weeks prior to the summit.

The summit was designed to bring Eisenhower, MacMillan, DeGaulle, and Kruschev together to, among other things, end nuclear testing, put a cap on nuclear weapons, and erase the Iron Curtain.

Kruschev offered Eisenhower a way out - saying a rogue action by a US agency or department would not adversely impact the Summit. Apparently Eisenhower weighed his options and decided he couldn't admit that and took public blame for the U2 flights.

Learning this story leads one to Eisenhower's warning against the military industrial complex in his farewell seech. No one ever speculates why the warning was made. Until now, I've only wondered if he was so damn worried about it, why didn't he do something during his two terms. Now I think I know why.

So this changes the timeline when the Washington fell to an intelligence coup - not JFK's assassination but May 1960.

Well, well, well.

Morgan Stanley does jingle mail - again

2011-04-17T08:26:00.000-05:00

Morgan Stanley is bailing on Tokyo properties.

Morgan Stanley fund fails to repay debt on Tokyo property

(Reuters) - A Morgan Stanley property fund failed to make $3.3 billion in debt payments by a deadline on Friday, handing over the keys to a central Tokyo office building to Blackstone (BX.N) and other investors, the largest repayment failure of its kind in Japan.

[Ed. note: MS does jinge mail - again.]

It marks the latest fallout from a series of highly leveraged investments by Morgan Stanley (MS.N), one of the most aggressive investors in worldwide property markets before the global financial crisis.

The $4.2 billion MSREF V real estate fund missed its April 15 deadline to repay 278 billion yen($3.3 billion) worth of debt packaged in commercial mortgage-backed securities on the 32-storey Shinagawa Grand Central Tower, a property which has seen its value plunge, two people involved in the transaction said.
[Ed. note: Did that value plunge occur after 11 March 2011?]

They spoke on condition of anonymity due to the sensitive nature of the matter.
[Ed. note: Thank god for Anonymous, or else we'd learn precious little.]

A Morgan Stanley spokeswoman in Tokyo declined to comment. A New York based spokesman for Blackstone, which holds the most junior portion of the debt and gains the right to market the building for seven months, was not immediately available for comment.
[Ed. note: The Blackstone spokesman was strangling the Morgan Stanley spokesman.]

This is the largest repayment failure of debt packaged in CMBS in Japan, according to analysts and industry experts, bigger than the 112 billion yen that real estate investor K.K. daVinci Holdings failed to pay on the Pacific Century Place office building.
[Ed. note: The largest repayment failure so far.]

MSREF V bought the Shinagawa property for 140 billion yen in 2004 from Mitsubishi Corp (8058.T) and Mitsubishi Motors (7211.T). The building now houses Microsoft's Japan offices among other tenants.

Morgan Stanley repackaged the loans into 125 billion yen worth of CMBS in 2005, according to a website for Morgan Stanley.

Taking advantage of a run-up in property prices, MSREF V refinanced its debt on the Shinagawa property in 2007 with new debt worth 278 billion yen, twice the value of its purchase and likely yielding a tidy profit for the fund.

The refinanced debt was sold in six different tranches by Morgan Stanley to investors.
[Ed. note: Six tranches of pissed-offed-ness.]

Turning Japanese in Massachusetts

2011-03-28T12:11:00.000-05:00

Based on medium-case scenarios out of Fukushima, cClearly it would be foolish to cut back on ANY vices at this juncture because frankly, you just won't have time to die of alcoholism or drug addiction before the Cesium-137 gets you.

From Press-TV

Traces of radioactive iodine linked to quake-hit Japan's nuclear power plant have been found in rainwater samples taken last week in Massachusetts, US.
The low level of radioiodine-131detected in Massachusetts rainwater samples is comparable to the amounts found in California, Washington and Pennsylvania.

However, what the story doesn't cite is the plutonium seeping into water & ground. Plutonium (alpha emitter) can decay into far more deadly materials after after a short period of time. Plutonium-241 can decay into Americium-241, which is a gamma-ray emitter.

What are alpha emitters? From Princeton:

An alpha particle consists of two neutrons and two protons ejected from the nucleus of an atom. The alpha particle is identical to the nucleus of a helium atom. Examples of alpha emitters are radium, radon, thorium, and uranium.

Because alpha particles are charged and relatively heavy, they interact intensely with atoms in materials they encounter, giving up their energy over a very short range. In air, their travel distances are limited to no more than a few centimeters. As shown in the following illustration, alpha particles are easily shielded against and can be stopped by a single sheet of paper.

So, those workers at the plants are dead ducks. And everything leaking into the ground & water could mutate into gamma emitters.

What are gamma emitters? From Idaho State University:

After a decay reaction, the nucleus is often in an “excited” state. This means that the decay has resulted in producing a nucleus which still has excess energy to get rid of. Rather than emitting another beta or alpha particle, this energy is lost by emitting a pulse of electromagnetic radiation called a gamma ray. The gamma ray is identical in nature to light or microwaves, but of very high energy.
Like all forms of electromagnetic radiation, the gamma ray has no mass and no charge. Gamma rays interact with material by colliding with the electrons in the shells of atoms. They lose their energy slowly in material, being able to travel significant distances before stopping. Depending on their initial energy, gamma rays can travel from 1 to hundreds of meters in air and can easily go right through people.
It is important to note that most alpha and beta emitters also emit gamma rays as part of their decay process. However, their is no such thing as a “pure” gamma emitter. Important gamma emitters including technetium-99m which is used in nuclear medicine, and cesium-137 which is used for calibration of nuclear instruments.

Chernobyl goes east

2011-03-25T12:50:00.001-05:00

Sun-Times reports that Tokyo residents clean out shelves of bottled water, and other supplies. It is now admitted that tap water is not safe for adults.

Today's reports state mustard spinach in Tokyo have radiation levels above acceptable limits.

But there is some good news: GE reported $5.1 billion in profits for 2010 and a tax credit of $3.2 billion. Well played, GE.

And the latest part of the world to go up in flames: Syria forces fire on protesters.

Maybe it does start with a bang

2011-03-13T21:38:00.000-05:00

Thursday, 10 March 2011, shortly before midnight Chicago time (CST) a 9.0 earthquake hit Japan. Then the tsunami struck. And a chain of volcanoes from Russia to Indonesia erupted - going out on limb here, probably tripped by the epic earthquake. Then six (as of now) nuclear reactors' cooling systems are failing or failed.

What next for Japan?

The Japanese stock markets plunged on open, triggering circuit breakers. Financial Times reports the Bank of Japan plowed Y7 trillion into the markets to prop them up. Yen worldwide is being repatriated to invest in repairing/rebuilding Japan. What is not reported in that article but should be assumed is the Fed doing the same plunge protection in the Sunday overnight futures markets and ready for the Monday open of US markets.

When it rains, it erupts

2011-03-11T19:45:00.000-06:00

Japan was struck by a 9.1 earthquake at 11:45pm CT (upgraded from an earlier reported 8.9).

In the wake of this tragedy, an Indonesian volcano erupted.

One of Indonesia's most active volcanoes, Mount Karangetang, erupted Friday, sending lava and searing gas clouds down its slopes. The 1784-meter mountain is located on Siau, part of the Sulawesi island chain. It last erupted in August, killing four people. The eruption occurred hours after a devastating 8.9-magnitude earthquake hit Japan and triggered a Pacific-wide tsunami.

Over in East Java, Mount Bromo is now erupting.

And two volcanoes in eastern Russia are erupting.

Two volcanoes in Eastern Russia , Kamchatka and one other in Indonesia, have erupted around the same time as the Japan 8.9-magnitude Earthquake on Friday.

And Japan has problems with some of their nuclear reactors.

March 12 (Bloomberg) -- Tokyo Electric Power Co. said it lost control of pressure building at three reactors at one of its nuclear power plants, and radiation levels are rising at another after a powerful earthquake shut down the plants’ cooling systems.

Wartime sucks

2011-02-24T12:45:00.002-06:00

Because it means that sometimes even those you despise say things you agree with.

Latest case in point: [Resident Commissioner Pedro] Pierluisi said Gutiérrez “went too far” when he took to the House floor Wednesday urging members of Congress to eye what he called human and civil rights violations in the “U.S. colony of Puerto Rico.”
I can't believe he had the cojones to call it like it is for the record.

The Saudis are getting restless

2011-02-23T12:43:00.000-06:00

Thanks to Zero Hedge for this tip: Saudis ramping up for a protest against the monarchy on March 20 2011.

And where better to get the word out than Facebook? Riyadh expected to shut down access shortly.

Meanwhile, 50% Libya's oil production is offline. Italy gets 425k barrels A DAY. Italy is hosed. And Libya exports the sweet crude - not the heavy sour that gets shipped out of the Middle East.

Brent hit $111.
WTI hit $100.
The moves in the last two trading days undid just about every penny of QE1 and QE2. Bernanke, your plane is leaving.

America, meet your Arab Unrest moment.

Lots of players in this game

2011-02-22T12:56:00.000-06:00

I think we're now at the point that it's time to move attention from the countries in open revolt (see LIBYA) and look for the ones about to break out.

Ivory Coast extended their ban on exports, roiling the cocoa markets further.

The country's first election in a decade descended into a bloody standoff after incumbent President Laurent Gbagbo refused to cede power to winner Alassane Ouattara. Dealers now fear the country's cocoa industry may bear the brunt of the ongoing crisis as Mr. Ouattara has extended the ban until March 10, according to media reports citing his government's spokesman. Fresh clashes erupted between supporters of the rival presidents Monday, with army gunfire killing one civilian and injuring more than a dozen, as African leaders launched a new bid to break the impasse.

Zimbabwe arrests 54 for watching Al Jazeera coverage of Egypt and Tunisia to help inspire revolt. Lawyers said at least 7 showed signs of torture.

Egypt granted permission on 18 February 2011 for Iran warships to pass through the Suez, and today they navigated the canal into the Meditrerranean.

Bolivian unions struck on Friday, 18 February 2011, over soaring food and transport costs.

Another country on the edge, Mexico could escalate from civil war to conflagerations crossing borders. Actually, it already has but it is easy to marginalize Arizona and Texas' south border for now.

Add Libya and Morocco to the list

2011-02-21T21:18:00.000-06:00

Libyan protests are ramping up and the Gaddafis have taken a different set of lessons from the Tunisia and Egypt protests: kill everyone as quickly as possible. That, and drop the big threats early. Saif Gaddafi, son of the Colonel, threatened civil war and destruction of the oil revenues.

Now Moroccans are marching, demanding the king cede powers to the newly elected government. The king's response? He will not kowtow to demagoguery.

So North Africa and the Middle East are up in flames. Wisconsin's on the edge over public unions, Washington could be shut down over budget impasse March 4. Chicago's mayoral election is February 22 and Ireland's general election is February 25. The French and Greeks are protesting. Where is the next weak link in the chain?

Anyone who had Mozilo in the Scapegoat pool is now OUT

2011-02-19T22:11:00.000-06:00

From the Daily Bell:

According to Los Angeles Times' sources, Angelo Mozilo has been the subject of a secret federal criminal investigation since 2008, and the 3-year investigation has now been officially closed with no indictments.

Good thing the press had the Wisconsin 14 for distraction.

Event Horizon in Libya & Bahrain?

2011-02-19T21:13:00.000-06:00

It's been said many times over the past 2.5 years, but things are accelerating to an alarming degree. Take, for instance, the past 96 hours. Wednesday I have an outpatient procedure which took me out of the news loop effectively until today.

So today I had to get caught up on:
A) The Wisconsin 14 hiding out in Illinois. As if WE are the beacon in the darkness.
B) Ray McGovern gets roughed up while silently protesting a speech by Sec. Hillary Clinton. Naturally, this occurred while she lauded the merits of peaceful protest.
C) Protesters in Bahrain and Libya mowed down by police state agents. Zero Hedge links to a Libyan boy killed by a sniper.

Not to forget where the causes of this ramp-up in revolution is coming from (read: hyperinflationary food prices that will be coming to the United States soon) the insolvent Irish banks are issuing Euro-denominated bonds to themselves. Yes, they are printing money, Virginia.

Very quietly, the Icelanders are bouncing back and arresting the banksters. Those facts are related.

Liberman is the Pied Piper of Congress

2011-02-10T12:35:00.000-06:00

Rep. Christopher Lee (R-NY) bolted from the House of Representatives, shouting to Speaker Boehner as he ran past, "I quit!"

Why did Chris Lee leave so suddenly? It seems he admits he sent a shirtless photo of himself to a woman on Craigslist. Really. This could possibly be the LAMEST reason for resigning from Congress.

Over at the Senate, Senators Jon Kyl (R-AZ) and Jim Webb (D-VA) announce they won't seek reelection. Did Lieberman cast some voodoo spell over them? If you're keeping score, Kay Bailey Hutchinson (R-TX) and Kent Conrad (D-ND) also announced within the last month they're not going for the gold again either.

So the only way to get turnover in Congress is for those slack-jawed rats to retire? Of course not. It means that every election, nationwide, is fixed.

And now the Suez is a front in the Egypt revolt

2011-02-08T12:07:00.000-06:00

Business Insider picks up a story from Ahram Online:

According to Ahram Online (via NYT), the first worker strike at the uber-important Suez canal have gone on strike. 6,000 workers are sitting in. Specifically they are opposing weak pay and bad conditions.

So far there's been no disruptions. That doesn't mean there won't be.

Note this, because they'll do it to you

2011-02-02T22:29:00.000-06:00

A Whistler, BC resort's business slumped in the wake of the 2010 Vancover Olympics so they killed 100 of their employees. The Canadian National Post reports:

Reports surfaced Monday that an unidentified man involved in the dogsledding operation was granted workers’ compensation after developing post-traumatic stress disorder for allegedly being forced to kill the dogs.

Wait, there's more.

There are provisions in the SPCA act that allow for Criminal Code charges and Moriarty [BC SPCA] said this case warrants them: “Dogs crawling around in a mass grave; half of one’s face blown off — if those actions don’t constitute Criminal Code offence, I don’t know what does.”

Mark this. What people do to dogs they'll do to people, and they'll do it a lot faster with less guilt.

Never let a distraction go to waste

2011-02-01T13:31:00.000-06:00

While everyone's looking at Egypt* Israel is massing troops along the Lebanon border.

*Pretty impressive Million Man March today though.

Sudan is mad as hell now

2011-01-30T12:07:00.000-06:00

Khartoum is down the Nile from Cairo and they're not happy either.

Police clash with students in Khartoum

And if you're wondering about that referendum, 99% of South Sudan voted for splitsville.

So much for the NFL being recession proof

2011-01-30T10:41:00.000-06:00

From the Sunday Sun-Times:

At least 16 NFL clubs have announced they will not raise prices for their 2011 tickets, with two teams, the Tampa Bay Buccaneers and San Diego Chargers, rolling some prices back.

The Bears have not made a decison on an increase, spokesman Scott Hagel said. For some teams, the sting of empty seats from the past season may affect the decision. The Buccaneers had all eight of their games blacked out because they failed to sell out, while the Chargers (three blackouts) and Cincinnati Bengals (four) had similar woes.

For other teams, such as the Indianapolis Colts, Baltimore Ravens and New England Patriots — who all made the playoffs and still decided to forgo price hikes — the ongoing fight over the soon-to-expire collective bargaining agreement, and the potential for a work stoppage, may be influencing the decision. Last year, 18 teams raised prices.

Charlotte Airport somewhat unclear on securing the premises

2011-01-28T22:19:00.001-06:00

On November 19 2010 (week before Thanksgiving) an undercover TSA agent bribed a JetBlue agent in Charlotte NC to sneak a bag on board and assign it to a different passenger. How much did it cost? $100. Life's cheap in the South.

This would be bad enough except the week prior to this Charlotte had another security misadventure.* A North Mecklenburg HS student, Delvonte Tisdale, snuck onto the tarmac, climbed into the wheel well of an airplane, and then the mutilated body fell to the earth when the plane prepared to land in Boston. Guess that high school kid was smart enough to outwit TSA (sure, that's setting the bar pretty low), but failed to account for the fact he'd freeze to death at 35,000 feet.

*I say misadventure, you say breach. Law enforcement also says breach.

The Italians aren't happy, and worse - they're starting to figure things out

2011-01-28T21:18:00.000-06:00

PressTV

[January 27] is held in Italy as a memorial for those who died fighting against Benito Mussolini's fascist government before and during World War II.

Davide Boni of the Northern League Party told Press TV, “People have been talking out against the Northern League and Silvio Berlusconi for years but nothing ever changes. It is just a tactic to sell more newspapers and divert attention away from other problems. The Left plays a part of this game as they are the ones who keep bringing this question up.”

Italy has seen a wave of protests directed at the Berlusconi regime. On Wednesday, a nationwide transportation strike caused heavy delays as workers protested government spending cuts for public transportation.

Davos soldiers on

2011-01-28T14:45:00.000-06:00

No pun intended.

They're still talking smack at Davos, while Tunisia showed support for Egyptian protesters. British PM Cameron went out on a limb, telling the Davos World Economic Forum it that it was "frankly ridiculous" that the Doha round of world trade talks had so far limped on for a decade.

Good for you, Cameron. Don't let the fact North Africa is on fire divert you. Or that Cairo police beat up a BBC correspondent with steel pipes. Or that ElBaradei was hit by police water cannons. Reportedly he's under "house arrest" now. Whatever the fuck that means in a Cairo under siege.

Syria's panicking, Mubarak calls out the military

2011-01-28T12:12:00.000-06:00

Being reported: Syria shutting down internet access. Syria, did you notice how that did not stop things in Egypt?

UK Telegraph with every other major media outlet is reporting that Mubarak has called in the military, including tanks, and other sources report shoot-to-kill orders are issued. From the Telegraph:

Protesters cheering the police who joined them and hoisted them on their shoulders in one of the many dramatic and chaotic scenes across Egypt on Friday.

After chasing the police, thousands of protesters were able to flood into the huge Tahrir Square downtown after being kept out most of the day by a very heavy police presence. Few police could be seen around the square after the confrontation.

It's over, it's all over

2011-01-27T22:42:00.002-06:00

The Illinois Supremes voted 7-0 to put Emanuel back on the ballot. Does this mean the two Appellate justices who took him off are in TROUBLE?

The Sun-Times is happy. The Tribune is happy. The CME, CBOE, Citadel, and assorted hedge funds are happy. The fucking suburbanites are happy.

Who's not happy? I'm not happy. That fucking jagoff.

Protests in Egypt

2011-01-25T12:58:00.000-06:00

Reuters links it to the Tunisian protests which began December 17 2010 when a man immolated himself in response to police harassment. President Zine al-Abidine Ben Ali fled Tunisia on January 14 2011. Protests today in Cairo and other cities were preceded by lawyer Mohamed Farouk Hassan, 52, protesting rising prices before setting himself alight on January 18.

From December 2010 through today
Protests erupted in Tunisia's neighbor, Algeria in the wake of Tunisia's crisis and focused on food prices.

In Jordan, hundreds of protesters chanted slogans against Prime Minister Samir al-Rifai in the southern city of Karak on January 14.

Sudan saw student protests against cuts in subsidies to sugar and petroleum products.

Oman saw protests against government corruption.

Banks and cops - who's in more danger

2011-01-25T12:21:00.000-06:00

I jest of course - it's the cops in more danger. Meanwhile, on the bankster front, Ambac has a bone to pick with Bear Stearns/JPMorgan. Included in the lawsuit is this statement:

JP Morgan personnel understood that the loans underlying the transactions were in fact – to use one JP Morgan employee’s unequivocal if impolite words – a “sack of shit.”

Back to the cops. In the 24 hours from Sunday (1/23/11) afternoon to Monday (1/24/11) eleven officers were shot. Sunday afternoon saw attacks against officers in Indiana (1), Oregon (1), and a Detroit police station (4). Monday had attacks in Washington (2), Florida (3 - 2 fatal). From the Examiner:

"It's not a fluke," said Richard Roberts, spokesman for the International Union of Police Associations. "There's a perception among officers in the field that there’s a war on cops going on."

I'd be hard-pressed to disagree with that statement. The break-ins conducted by cops on the wrong houses; wounding or killing innocent people by cops; failure to investigate, arrest, indict, and convict the rampant lawlessness in the financial community (start but don't end with FRAUD). And that's without touching on the TSA (no pun intended).

Yeah, the American people aren't really wild about the law enforcement community.

Left one thing off the to-do list

2011-01-24T22:46:00.001-06:00

Picture it: Rahm Emanuel at a table with his campaign advisors, going over the To-Do List.
Election Hearing? Check.
Circuit Court? Check.
Burt Odelson? Ah, who cares about that guy - he's done.
Well, to be sure we should send someone to talk to the Appellate Court.
Rahm, Rahm Rahm - it's in the bag!

Cut to Monday, 24 January 2011.

“We ... order that the candidate’s name be excluded (or if, necessary, be removed) from the ballot,” Judge Thomas Hoffman wrote in the opinion upholding the requirement under the state’s municipal code that candidates for mayor in Illinois must have “resided in” the town where they are running for a year before Election Day — in this case Feb. 22. Hoffman was joined by Justice Shelvin Marie Louise Hall. [Sun-Times]

Rahm Emanuel's unofficial reaction: What the ! Who's the who told me it was in the bag?!?! Somebody's going to be !

The FT reports:

The Illinois appellate court determined that Mr Emanuel did not fulfil the one-year residency requirement for mayoral hopefuls since he moved to Washington in January 2009 to become President Barack Obama’s chief of staff and lived there until last October. Monday’s decision came just a week before early voting in the race is due to begin January 31.

Ha HA, you lousy slack-jawed rat!
And FT goes on to say:

Mr Odelson, who was a member of George W. Bush’s legal team in the Florida recount effort during the 2000 presidential election, argued that Mr Emanuel was ineligible, since he has been living in Washington and his house in Chicago had been rented out. Mr Emanuel’s lawyers countered that he always considered Chicago home and was exempt from the residency rule since he was in Washington on the business of the nation.

Once again, the enemy of my enemy is my friend.

Let the cannibalism commence!

2011-01-19T16:55:00.001-06:00

When only the big boys are the only ones left with money, how long does it take before they turn on each other?

Bloomberg reports:

JPMorgan Chase & Co.’s EMC Mortgage, facing homeowner lawsuits over foreclosures, was sued by the trustee of a mortgage portfolio for refusing to turn over documents detailing the quality of loans bought by the trust.

Wells Fargo & Co., the trustee, is seeking access to files for more than 2,000 underlying mortgages in the Bear Stearns Mortgage Funding Trust 2007-AR2, according to the complaint filed today in Delaware Chancery Court in Wilmington.

“The trustee has repeatedly requested that EMC provide access to the subject documents,” Wells Fargo said in the complaint. “EMC has played proverbial ‘rope a dope’ and otherwise continued to drag its feet, and has produced nothing.”

Claims of wrongdoing by banks and loan servicers triggered a 50-state investigation last year into whether hundreds of thousands of foreclosures were properly documented as the housing market collapsed. Lending practices have also pitted mortgage-bond investors against banks over misrepresentations such as overstatements of borrowers’ income and inflated appraisals.

Christine Holevas, a spokeswoman for New York-based JPMorgan, declined to comment.

Wells Fargo said it needs access to the documents to answer “serious” questions raised by investors in the trust about whether EMC breached representations and warranties regarding the quality of option-adjustable rate mortgage loans the trust bought.

In the Aug. 31, 2010, letter to San Francisco-based Wells Fargo, Grais said he had investigated 1,317 of the loans held by the trust and determined that EMC appeared to have violated its representations with respect to 938 loans, according to the complaint.

71.2% percent FAIL rate - how do you like them apples?

So glad Springfield didn't piss off this constituency

2011-01-12T10:28:00.000-06:00

[Sun-Times] House Rejects $1.01 Cigarette Tax Hike
BY DAVE MCKINNEY Sun-Times Springfield Bureau Chief Jan 12, 2011 01:06AM

The Illinois House rejected a $1.01-a-pack increase in the state’s cigarette tax, dealing a setback to efforts by Gov. Quinn to pass a revenue package that will help the state out of its $15 billion budget hole.

The vote was 51-66, but the measure was kept alive through a parliamentary maneuver. The cigarette tax increase would have earmarked $375 million for education.

So glad the 14 smokers left in Illinois aren't getting screwed.

I was a spy for the government because I think out-of-the-box

2011-01-11T12:35:00.000-06:00

This combo of NY Daily News article and comments is pure comedy.

Author Brad Meltzer was recruited in government agency, 'horrified' at how easy it is to attack U.S.

I was a real-life secret agent. [I]n 2004 I was recruited by the Department of Homeland Security for its Red Cell program.
Red Cell was the government's way of trying to anticipate how terrorists would next attack the United States. To do that, the government brought together what they called "out-of-the-box thinkers."
I'm not allowed to tell you what the targets were. Or where they were. But I can say that we'd destroy major cities like my hometown, New York. In minutes. And when I went home at night, I felt horrified, because I saw how easy it was to kill us.
Sure, there were "real" heroes, members of the FBI and CIA, who helped us with vital facts. But there were far more professors and transportation employees, musicians and software programmers - regular people whose names will never be known and whom you'll never hear about.

And now for some comments:

Lenscap comment: psy-op

Dick Myers comment: Unknown to Brad Meltzer, I am the secret spy coordinator he has been reporting to. FYI, your "Decoded" series is boring.

Factchkr comment: This is a remarkably fact-free piece of writing.

realistic22 comment: Doesn't sound like you were a secret agent. It sounds like you were a bureaucrat.

And so many more good ones.

No, really, you're different from the others

2011-01-09T11:04:00.000-06:00

Piggybacking on a Der Spiegel report, Reuters had this Saturday 8 January 2011:

"BERLIN (Reuters) – Germany and France want Portugal to accept an international bailout as soon as possible in order to prevent its debt crisis spreading to other countries, German magazine Der Spiegel reported on Saturday."

That might mean something if they were saying it for the first time. To the way-back machine!

UK Telegraph, 28 April 2010

Greek debt crisis spreading 'like Ebola' and Europe must act now, OECD warns

"The Greek debt crisis is spreading “like Ebola” and Europe must act now to protect the stability the financial markets, according to the Organisation for Economic Co-operation and Development. "

On to Reuters, 16 November 2010:

"Ireland's Finance Minister Brian Lenihan said on Tuesday it would welcome help in fixing the problems in its banking system but financial assistance to the country is not inevitable.

Euro zone ministers have agreed to send a joint European-IMF mission to Ireland that could prepare the way for a bailout to prevent its debt crisis spreading to other countries."

Then Bloomberg, 1 December 2010:

Debt Crisis Spreading to the Heart of Europe as Belgium Bond Yields Surge

"Europe’s sovereign crisis is spreading to the heart of the 16-nation bloc as investors question Belgium’s ability to cut the euro region’s third- highest debt load, overshadowing its economic performance.

The Italian spread climbed to a euro-era high of 186 basis points.

The European Union’s 85 billion-euro ($111 billion) rescue package for Ireland has failed to quell market turmoil as investors shift their focus from peripheral states[.]"

Cub bailout? No, hell no, no!

2010-11-13T13:06:00.000-06:00

Ricketts & Co. making play for taxpayer-funded renovations to Wrigley Field and surrounding area.

Cubs Executive Chairman Tom Ricketts tried Friday to calm the uproar. In several radio interviews, he said Cubs fans are on the hook, not the at-large taxpayer on the South Side, in Peoria or in Carbondale.

That's not quite true, is it Mr. Ricketts?

The bonds also would get a better credit rating with additional security, much like a co-signer on a loan. The Cubs' proposal calls for the bonds to be backed by a hotel tax that is used by the sports authority to repay debt for U.S. Cellular Field and Soldier Field.

And then there's this:

Ricketts argued that the city and county can't count on incremental revenue from the Wrigley amusement tax if the Cubs don't refurbish the 96-year-old ballpark. The growth in the amusement tax will primarily come from increasing ticket prices. Ricketts said it's easier to justify higher tickets prices over time in a renovated stadium.

Then refresh my memory - what was the justification for raising prices for the 2010 season? The 2009 season? Etc?

From Ticket News on the 2010 season:

Also raising prices by 10.1 percent this year, the Chicago Cubs take the title of the highest average ticket price in the league, at $52.56. The Boston Red Sox, which historically charged some of the highest ticket fees in the league, came in second this year at $52.32. The Yanks come in third at $51.83.

Interesting. The Yankees are the 2009 champions, while the Red Sox won championships in 2007 and 2004.

I'm so flaming irritated by this naked grab for taxpayer money that I have heartburn. How handy that slack-jawed State Sen. Cullerton is already prepped to introduce the legislation to authorize the Illinois Sports Facility Authority (ISFA) to issue bonds backed by city & county amusement tax revenues. And that it was announced after the election.

With this state/county/city in a death spiral of bond rating downgrades, who in their right mind would buy those bonds? Backed by amusement taxes in a depression no less! (Oh sure, NBER said the recession ended summer of 2009. Other than Washington, who pays attention to those idiots?)

And if I hear one more idiot talk about the benefit sports teams bring to the economy I may get violent. Sports teams, professional and amateur, do not generate extra revenues in the metro area. What they do is redirect discretionary spending away from other neighborhoods. And in the Great Recession the discretionary spending is evaporating to nothing.

Benefits of pro sports on economy often overstated

Pro Sports Impact Closer To A Bunt Than A Homerun
(University of Washington)

To warm up his audience, [UW Professor] Beyers held a "pop" quiz. "I'm going to give you three different percentages for the economic impact of sports on the local economy, and you raise your hand for what you think is the right answer," he said.
"Ten percent." (A good number of hands rise.) "One percent." (A majority of hands are held high.) "One-tenth of one percent." (Hardly a hand in the air.)
"The correct answer is 1/10th of one percent, and even that is probably overstating it," Beyers told the crowd.

Well, we certainly can't let that information get in the way of a bond issue!

I see your punk ass and I'm shooting it off

2010-09-30T12:58:00.001-05:00

In today's Chicago Sun-Times they cover Margaret Matthews, 68 year old black woman, living in Chicago's South Shore neighborhood, finally had enough of the terrorizing and attacks and fired upon her attackers: teenage boys. And she nailed one of them in the shoulder.

From the Stella Foster column:

IT IS SO SAD THAT Margaret Matthews, a 68-year-old widow living alone in her South Side home, got so fed up with some little thugs in her neighborhood victimizing her that she pulled a gun, chased and shot a 12-year-old boy in the arm on Tuesday after she was hit in the thigh with a brick. The boy survived and has been charged with assault. She fortunately was not charged because she acted in self-defense.

A 12-year-old hurling a brick can be just as lethal as one thrown by a grownup. A 12-year-old with a gun can kill just like an adult. And it is time for parents and their rowdy offspring to be held more accountable for their actions.

Yeah, I said it!

From the Mary Mitchell column:

Fed-up woman realized cavalry wasn't coming

When people get fed up, they stop waiting for help to come. On Tuesday, one South Side senior had had enough. When two boys who allegedly broke her windows were brazen enough to come back and curse her out, Margaret Matthews shot one of them in the arm.

According to the woman's neighbor, Hilda Brunt, the boys, ages 12 and 13, had been tormenting the senior for a while.

And from the front page article (which strangely is very hard to find on the web site):

Support for senior woman who shot boy, 12

Margaret Matthews gave a simple reason why she shot a 12-year-old boy who threw rocks at her on her South Shore porch Tuesday: "I done had enough."

These kids are out of control --we all done had enough," Johnson [friend of Margaret Matthews] said Wednesday as neighbors overwhelmingly rallied in Matthews' support, dubbing her a "hero."

But Matthews, who has lived at the coach house in the 7600 block of South Cole for 30 years, won't be charged because she acted in self-defense, police say.

I think if Daley and the CPD had their druthers they would have preferred to press charges on Margaret Matthews, but the outcry on the elderly gentleman who protected himself against an invader earlier this year (shooting and killing the criminal) has put them back on their heels for now.

And the comments on the Sun-Times articles are awesome - the only people protesting Matthews' actions claim "it's never right to shoot a boy." Trolls and misguided idiots.

Oh, one other thing: I live in the same neighborhood as this woman, 5 blocks north of her. And almost everyone in this neighborhood is packing, legally or not.

One last thing: Mrs. Matthews lives in a section dubbed "Terror Town" which has the Chicago Police blue lights and no patrols.

No wonder Daley is getting out. Well, that and he probably can't hide Chicago's massive budget shortfall any longer.

Up the Republic!

Adventures of a Bible Transcriptionist, no. 37

2010-08-03T20:15:00.031-05:00

Getting close to another election, so the talk of the Ten Commandments is ramping up again. I'm sure this has been done before, but can we get on tape people coming out of various houses of worship to recite the 10 Commandments? On to the adventure, this time Exodus.

God spake all these words (Exodus 20:19). And his secretary was a graduate of the King James Version. And the Secretary annoyeth God to no end.

In a nutshell, God got those stiff-necked people (his words) out of Egypt, and Egypt was plenty glad to see them go. Oh sure, we've already heard the Israelites' version.

After he got them into the desert, he had them just where he wanted them. Flatfooted and hotfooted.

God rattled off 17 statements in pretty quick fashion (King James Version School for Secretaries had a rudimentary form of shorthand, and it didn't mesh well with cuneiform/hieroglyphics). Not only was the secretary flustered, but the Israelites were thrown off their game too. So they tooketh Moses aside and said unto him, "Speak thou with us, and we will hear: but let not God speak with us, lest we die." And if you're wondering, yes, yes they were a bunch of drama queens.

So Moses went back to God, who had retired to a thick darkness. We call them taverns today. And lo and behold, God wasn't done talking. He had only gotten started. It was a long night for Moses.

At this point let me backtrack a little. In his first spouting off, God mentioned "Lord your God am a jealous God, visiting the iniquity of the fathers on the children to the third and the fourth generation of those who hate me, but showing steadfast love to thousands generations of those who love me and keep my commandments."

So say someone loves God (great!) and his thousands generations get steadfast love of God. But say someone in Generation Two hates God (got lots of acne in his teens - so much for the steadfast love) and God visited iniquity onto his descendants to the 3rd and 4th generations. But aren't they supposed to get the steadfast love, being originally covered in the thousands generations covenant? Ed. note: God kicked this to the boys over at Yale Law Review to ponder.

Exodus 21:12 He that smiteth a man so that he shall die, shall be put to death. Ed. note: Exception for war, death of any "outsiders," women (of course), and mean geezers (not including God, of course).
Exodus 21:27: And if he smite out his manservant's tooth, or his maidservant's tooth; he shall let him go free for his tooth's sake. Ed. note: For tooth's sake!

God goes on and on for some time. Ten Commandments - bah! It's more like the Law Bulletin.

The secretary recalls (Exodus 22:24) "And my wrath shall wax hot, and I will kill you with the sword; and your wives shall be widows, and your children fatherless." Groucho was funnier.

Exodus 22:28 Thou shalt not revile the gods, nor curse the ruler of thy people. The secretary pressed him on this, "surely you mean 'god,' right God?" God get snappeth and barked a few verses later (23:13) "Make no mention of the name of other gods, neither let it be heard out of thy mouth." I think God's letting some of those other personalities seepeth through (again).

Secretary further offers, after a sympathetic colleague buys Secretary a beer that God didn't omit the liquor distribution racket (Exodus 22:29) " Thou shalt not delay to offer the first of thy ripe fruits, and of thy liquors." And he mentioned liquors TWICE. Oh, and he never buys a round - he doesn't have any pockets to carry his wallet. What a cheapskate.

Sadly, God is a lobbyist for Goldman Sachs (Exodus 23:3) "Neither shalt thou countenance a poor man in his cause."

And he was weirdly obsessed with unleavened bread (Exodus 23:15). Have you ever had that stuff? It's gross.

And then, Secretary confided, God had a little too much of the first liquors and barketh at Moses (Exodus 23:21) "Beware of him [i.e. angel] , and obey his voice, provoke him not; for he will not pardon your transgressions." So he's sending an emissary with a nice personality combination, hostile and intolerant."

But God's not just a speculator, he's a hedger too. (Exodus 23:28-30) And I will send hornets before thee, which shall drive out the Hivite, the Canaanite, and the Hittite, from before thee. And I will send hornets before thee, which shall drive out the Hivite, the Canaanite, and the Hittite, from before thee. I will not drive them out from before thee in one year; lest the land become desolate, and the beast of the field multiply against thee. By little and little I will drive them out from before thee, until thou be increased, and inherit the land.
Ed. note: We'll let the whole hornet thing pass without comment.

Secretary also mentions, in keeping with God's other habits, that he can go on quite a bender. And the hangover that follows is of epic proportions. (Exodus 24:16) And the glory of the LORD abode upon mount Sinai, and the cloud covered it six days: and the seventh day he called unto Moses out of the midst of the cloud.
Ed. note: "Glory" is code for "hangover." Note it took six days to work off that hangover.

In Exodus 26, God gets all Martha-Stewarty, getting into way too much detail on what wood the ark should be, and the curtains. BORING. Although it is interesting to see that God likes gold as much as we do.

The Secretary was asked about Exodus 26: And thou shalt put the mercy seat upon the ark of the testimony in the most holy place. Secretary confirmed it was frightening to ask.

For chapter 28, God was out of town so Aaron provided God's dictation. Secretary found this odd, but took it anyway. Strangely, the whole thing revolves around garments "made for beauty and glory" of the priests. Although they do have to wear a bell when Aaron goes into the holy place or God will have to kill him.
Ed. note: That does have the ring of a God commandment.

After yakking for several chapters, God finally finished the tablets (Exodus 31:18) written by the finger of God. So, Secretary, no credit whatsoever for the endless dictation? Secretary smirks and says "Oh, I got my glory a little later."

Secretary continues "Chapter 32 was the 'Aaron' chapter - not dictated by Aaron though. He went crazy with desert fever and made golden calves. And God was not amused. He told Moses (Exodus 32:9-10) ' I have seen this people, and, behold, it is a stiffnecked people: Now therefore let me alone, that my wrath may wax hot against them, and that I may consume them.'" Moses talked him out of it, by pointing out all the work he had already done just getting this stiffnecked people out of Egypt and to this point.

But then, Secretary says, chapter 33 got a little weird. A little weird, we exclaim! Secretary recounts (Exodus 33:11) that God spake unto Moses face to face. Naturally, we have to take Moses' word for it because a cloudy pillar blocked the entrance to the tent. It's followed up with (Exodus 33:20) "Thou canst not see my face for there shall be no man see me, and live." Secretary comments "I think both God and Moses were dipping into the liquor." But, Secretary says, "I promised you it would get weirder and it does. (Exodus 33:22-23) "And it shall come to pass, while my glory passeth by, that I will put thee in a clift of the rock, and will cover thee with my hand while I pass by: And I will take away mine hand, and thou shalt see my back parts: but my face shall not be seen."
Ed. note: So God mooned Moses. And Secretary was there to see it all.

Beau Geste in the World Cup

2010-06-22T20:48:00.002-05:00

Today's FT revealed I am way behind on salacious World Cup stories. Credit Agricole, Quick (a burger chain), and Pringles have all pulled advertising because of dissension on the team, including a strike by the French players. (Insert your own joke here.)

But as funny as that is (and it is), here's what I took away from it: advertisers are not only willing but anxious to find a reason to pull advertising on sports. The economy is that bad that even sinking money into our modern day opiate isn't getting it done.

Crédit Agricole shows French World Cup team the red card

By Roger Blitz and Richard Lapper in Bloemfontein and,Peggy Hollinger in Paris

Published: June 22 2010 03:00 | Last updated: June 22 2010 03:00

France's World Cup campaign, crippled by dire performances on the pitch, internal strife and a players' strike, went from bad to worse yesterday when Crédit Agricole pulled an advertising campaign and sponsors demanded action by the country's football authorities.

The French bank said it had stopped the advertising campaign - due to run until June 25 - early "in view of the current controversy surrounding the French national team".

The team's corporate sponsors have held conference calls to voice their anger at the players' refusal to train.

One person who took part in the calls said that the sponsors believed the situation was "unacceptable".

France are on the verge of elimination from the tournament, their 2-0 defeat to Mexico on Friday forcing tension between management and players into the open. The French play South Africa in their final group game tonight.

The crisis and the behaviour of the national team has triggered an avalanche of public criticism in France. President Nicolas Sarkozy has demanded representatives of the players and the football federation meet with sports minister Roselyne Bachelot to restore calm.

It has highlighted, too, the sometimes fragile relationship between teams, players and their sponsors - graphically illustrated in the past year by sponsors deserting US golfer Tiger Woods over revelations about his private life.

The team's management sent home striker Nicolas Anelka for verbally abusing coach Raymond Domenech during half-time in the Mexico game, a move that led to the team's refusal to train on Sunday in protest. Jean-Louis Valentin resigned as team director in disgust at the players' behaviour.

Quick, the French burger chain, and Pringles the crisp brand owned by Procter & Gamble, have also pulled ad campaigns involving Mr Anelka.

The French debacle has led to sponsors working collectively to demand immediate action by the French Football Federation. Sponsorship and TV rights of the French national team are worth €70m, according to Les Echos. The team sponsors are retailer Carrefour, utility provider GDF Suez, Crédit Agricole, SFR, the telecoms company, and sports goods maker Adidas.

Let's talk geology of the Deepwater Horizon disaster

2010-06-20T16:05:00.001-05:00

We've given it 2 months, now let's talk about the geology of this oil spill. Courtesy of the George Washington blog, reposted on Zero Hedge:

There are several topographical maps in the post, making the point that the Deepwater Horizon well is in a canyon. On a slope in a canyon, to be more precise.

And the area is tectonically active.

And landslides are a real risk.

Per Offshore Magazine, on 4/21/2010:
ZUG, Switzerland -- The semisubmersible drilling rig Deepwater Horizon has reported a fire onboard, says Transocean Ltd. The rig is in the Gulf of Mexico Mississippi Canyon block 252, 41 mi (66 km) offshore Louisiana.

Transocean reports its Emergency and Family Response teams, the US Coast Guard, and oeprator BP Exploration & Production Inc. are responding. The reports says "a substantial majority of the 126 member crew is safe but some crew members remain unaccounted for at this time."

Offshore has a running column on the Deepwater disaster: The 6/21/2010 covers efforts to boost recovery of escaping oil.

Sinkhole terrorizes Montreal

2010-05-12T13:46:00.004-05:00

From the Montreal Gazette:

On Monday night a huge sinkhole opened up and a family home sank into it, in St. Jude, about 77 kilometres northeast of Montreal, and north of St. Hyacinthe. Five nearby homes have been evacuated. All four members of the Préfontaine family were confirmed dead around 8:30 p.m. on Tuesday evening.

You see that little blue thing? That was a two-story house. There are more pictures at the link.

Moving on - Portugal? Spain? France?(!)

2010-04-18T19:50:00.002-05:00

Baseline Scenario makes the argument that Portugal is the next target of CDS speculators, and while reading the article made me think of this line:

Then there was Portugal, half-senile and three-quarters bankrupt, hoarding her ancient possessions in Africa[.]

It's from "Scramble for Africa" (Thomas Parkenham). I've read it multiple times - great stuff. What was true in the 19th century (and through to WWI), true today.

Back to Baseline Scenario:
To resolve its problems, Portugal needs major fiscal tightening. For example, just to keep its debt stock constant and pay annual interest on debt at an optimistic 5% interest rate, the country would need to run a 5.4% of GDP primary surplus by 2012. With a 5.2% GDP planned primary deficit this year, they need roughly 10% of GDP in fiscal tightening. It is nearly impossible to do this in a fixed exchange rate regime – i.e., the eurozone – without massive unemployment.

I'm leaning towards the ZH position, that France is the bigger target, because they're literally the bigger target:
CDS traders are now focusing their attention on the one country which has so far slipped under everyone's radar, yet which we disclosed is more on the hook in terms of Southern European exposure than even Germany: France, with $781 billion in total claims. Should Greece topple the PIIGS dominoes, France will implode. And this is precisely what CDS traders are betting on now, taking advantage of absurdly tight France CDS levels.

And as for you, Angela Merkel - who exactly is going to be left standing to be on the receiving end of your export economy model? Take your sanctimonious prattle and cram it down your throat.

Pres. Obama: The smoother, smarter version of Bush Jr

2010-03-21T10:51:00.002-05:00

I had hoped Obama wouldn't confirm my suspicions. And he has, in spades. (Too soon to pun? Okay.)

From Firedoglake:

"Edward Horgan, a well-known Irish activist and former Irish Defense Force officer, has had his 10-year, multiple-entry U.S. visa revoked without explanation. Horgan and others believe it is because of his principled stand against the U.S. use of renditions, and in particular, the use of Shannon Airport in western Ireland as a stopover for U.S. rendition flights. The Obama administration should be ashamed for its behavior in keeping Mr. Horgan from entering this country."

Obama's State Dept. pulled it on St. Patrick's Day. Those f*ckers have a sense of humor, don't they?

Today's word is COLORABLE

2010-03-11T21:53:00.001-06:00

Here's a handy little word: colorable.

According to Webster's:

–adjective

1. capable of being colored; 2. seemingly valid, true, or genuine; plausible; 3.

pretended; deceptive

Origin:
1400–50; late ME

Example of colorable:

The Examiner concludes that colorable claims of breach of fiduciary duty exist against Richard Fuld, Chris O’Meara, Erin Callan, and Ian Lowitt, and that a colorable claim of professional malpractice exists against Ernst & Young.

Goldman Sachs has feelings too

2010-03-04T13:36:00.002-06:00

GS's 10-K filing on 3/01/2010 below, with clarifying commentary thrown in for free (just doing God's work here):

Substantial legal liability or a significant regulatory action against us, or adverse publicity [talking about you, Zero Hedge], governmental scrutiny or legal and enforcement proceedings regardless of the ultimate outcome [Regardless of outcome - so don't inititate in the first place, or else], could have material adverse financial effects, cause significant reputational harm to us or adversely impact the morale and performance of our employees [and we can't stress enough, all of whom are doing God's work, not like those heathens at CME Group], which in turn could seriously harm our businesses and results of operations [We had 131 $100mln days in 2009, and we're shooting for 132 days in 2010]. We face significant legal risks in our businesses, and the volume of claims and amount of damages and penalties claimed in litigation and regulatory proceedings against financial institutions remain high. Our experience has been that legal claims by customers and clients increase in a market downturn [Which is odd since we make even more money in the downturns] and that employment-related claims increase in periods when we have reduced the total number of employees [like how we said layoffs without saying layoffs?]. For a discussion of how we account for our legal and regulatory exposures, see “— Use of Estimates” below. ["Use of Estimates" is code for "go f*ck yourself."]

64

Whatever you do, don't mention the war. Greece said what?!

2010-02-25T13:16:00.003-06:00

From the UK Telegraph:

Theodoros Pangalos, deputy prime minister, said Germany had no right to reproach Greece for anything after it devastated the country under the Nazi occupation, which left 300,000 dead. "They took away the gold that was in the Bank of Greece, and they never gave it back. They shouldn't complain so much about stealing and not being very specific about economic dealings," he told the BBC.

If the duck doesn't have money and doesn't pay its bills, it's Illinois

2010-02-19T08:29:00.003-06:00

The Chicago Sun-Times has an article in the Friday (2/19/2010) paper detailing how the State of Illinois has failed to deliver $250 million owed to the RTA (Regional Transportation Authority).

[Executive Director] Schlickman said the state is regularly late with its payments to the RTA for state-funded programs, but now the RTA is running low on cash. The agency has just $90 million in cash on hand, which will help cover operating costs and debt payments through the end of May.

"After May, the debt trustees* will start intercepting our funds," Schlickman said. "Come this summer, we may be forced to ask the service boards to adjust their budgets accordingly."

Included in the print edition but not the online is an insert titled "Where's the money?" (page 18).
State is $735 million behind on payments to public universities ($475 million to University of Illinois alone).
Has paid one-third of $15 million due to library systems.
State owes $564 million to public schools.

It would be helpful if the press called it like it was - the state is bankrupt. Nomina Rutrum Rutrum

*I don't know what "debt trustees" are, but I find it intriguing.

Nominated for dumbest state: Arizona

2010-02-06T13:32:00.002-06:00

Mesa AZ, anxious to keep the Chicago Cubs from fleeing to the Grapefruit League in Florida, promised them a new park.

A small hurdle: Arizona, and every municipality in it, is the fiscal equivalent of a SuperFund site.

So how to pay for this $83 million baseball park?

A surtax on Cactus League tickets, of course.

Wholly unexpected in Phoenix was the reaction of the other teams in the Cactus League - such as the Chicago White Sox. Their position, to borrow from Professor Quincy Wagstaff: whatever it is, I'm against it.

Road to Morocco

2010-01-28T22:29:00.001-06:00

If trouble comes looking for me I'll be awfully hard to find.

Hate the (Minnesota) Twins.

2010-01-25T12:36:00.001-06:00

Illinois is flat broke busted

2010-01-18T16:52:00.004-06:00

From the Crain's Chicago Business article:

"The crisis will come when you see state institutions shutting down because they can't pay their employees," says David Merriman, head of the economics department at the University of Illinois at Chicago.

A record $5.1 billion in state bills was past due at year end, almost doubling to 92 days from 48 days a year earlier the average amount of time it takes the state to pay vendors such as doctors, hospitals, non-profit service providers and other contractors.

State tax receipts from July through December last year were running more than $1 billion behind 2008, including a $460-million plunge in sales taxes and a $349-million drop in personal income taxes.

While California has an even bigger budget hole to fill, Illinois ranks dead last among the states in terms of negative net worth compared with total expenditures.

The sharp rise in pension payments is the biggest factor pushing Illinois toward what a legislative task force last November (2009) called a 'tipping point' beyond which it will be impossible to reverse the fiscal slide into bankruptcy.

And if you're wondering, while there is no legal provision for states to file bankruptcy, they can and have defaulted on debts. Arkansas did during the Great Depression. In the 1840s nine states defaulted on debts. Four completely or in part repudiated their debts. Two, Maryland and Pennsylvania, were able to pay back debt & interest after enacting property taxes. (New taxes - sounds familiar.) The other states already had property taxes which had been raised "(also sounds familiar) and thus resorted to walking away.

Pending changes to money markets, 401k, and IRAs

2010-01-10T11:49:00.000-06:00

With an eye to the lengthy post, I'm presenting the summary first: the Federal Government, in a joint effort by the Treasury Dept & Labor Dept, is proposing to permit freezing redemptions of money markets, 401ks, and IRA accounts - the latter two by converting them to annuities.

What this means to you:
A) no option to redeem your IRA/401k account (I believe the current penalty is 10% plus income tax paid)
B) forced conversion to Treasury bonds - which are at historically low yields (the 30yr is 4.375%)
C) the US Treasury issued $1.2 trillion in bonds in 2009 - of which the Chinese only bought $200 billion and other foreign buying was less than that. This means nobody is buying our crap paper but we have to issue even more than $1.2 trillion in 2010 - somebody's got to buy that stuff. Oh, and in December 2009 Moody's put the US on a watch list for possible downgrades. When an issuer gets downgraded, they have to raise rates to attract buyers - unless they have a captive audience.

Bloomberg: Retiree Annuities May Be Promoted by Obama Aides
The U.S. Treasury and Labor Departments will ask for public comment as soon as next week on ways to promote the conversion of 401(k) savings and Individual Retirement Accounts into annuities or other steady payment streams[.]

[Ed. note: It's also a very handy way to drum up demand for the flagging US Treasury market. And the ensuing equity market crash (which will happen when all those 401k & IRA income streams get diverted from the equity market to the bond market) will drive even more investors to Treasuries.]

Zero Hedge - This Is The Government: Your Legal Right To Redeem Your Money Market Account Has Been Denied

Money Market funds, which account for nearly 40% of all investment company assets. The next time there is a market crash, and you try to withdraw what you thought was "absolutely" safe money, a back office person will get back to you saying, "Sorry - your money is now frozen. Bank runs have become illegal." This is precisely the regulation now proposed by the administration. In essence, the entire US capital market is now a hedge fund[.]

And Zero Hedge's conclusion:

What we will know, is that now i) the government is all too aware that the market has become one huge ponzi, and that all investment vehicles, even the safest ones, are subject to bank runs, and ii) that said bank runs, will occur. It is only a matter of time. And just as the president told everyone directly to buy the market on March 3, so the SEC, the Group of 30, and Barney Frank are telling us all, much less directly, to get the hell out of Dodge.

Jesse's Cafe Americain: Obama Adminstration Wants To Annuitize 401k's and IRA's - Mandatory "R Bonds"
My model for thinking about this annuitization is that the government wishes to appropriate your savings for a 2.0% return, ex fees and mispriced risk and inflation, as a source of funding for the bailouts of an oversized and insolvent FIRE* sector (like AIG) and the imploding pretensions of a global financial elite.

Good luck.

*FIRE: Finance, Insurance, Real Estate

More Good News

2010-01-06T12:38:00.001-06:00

You'll see news outlets furiously try to persuade us that consumer spending was up for Xmas '09 over Xmas '08, but you can't argue with sales tax receipts.

And they were down 7.7% Dec '09 from Dec '08.

"Month to date tax receipts are now in for the entire month of December. They’re down 7.7% from December 2008, which is exactly the same rate of decline as November’s. We know that the TBAC and Treasury officials were not anticipating that in their debt sales forecast for the first quarter. They had assumed that a recovery was taking root and would continue to do so. That spells trouble for both bonds and stocks."

Contrast that with the Pollyanna NY Times:

"Despite a weak start to the holiday shopping season and snowstorms on historically big spending days, the nation’s retailers managed to have a better Christmas than in 2008, according to the latest data.

Mr. McNamara*, however, estimated that the retailing industry turned in a 1.7 percent sales increase in November and December compared with the period a year earlier."

Economists who actually saw the real estate bubble and coming crash have worse news for us:

"The recession is not over," said Michael Intriligator, professor of economics at the University of California, Los Angeles. He predicted economic output would not return to pre-crisis levels until 2013, while the job market would not fully recover until 2016.

[Joseph] Stiglitz^ said, what has so far emerged in terms of regulatory reform proposals is far too meek to have any effects. "The regulatory reforms on the table are totally inadequate," he said.

*Vice president for research and analysis at SpendingPulse, an information service of MasterCard Advisors.
^Joe Stiglitz was an economic advisor to Pres. Obama during his presidential campaign.

Neurotic, or Type A - or something else altogether

2009-12-01T21:21:00.001-06:00

As I patiently wait here for the company's internal website to come up so I can provide Wider Feedback to three lucky people (part of our excrutiatingly long annual review process - and you thought your job sucked) I start to ponder a jab made by a colleague a couple of months ago that I'm a Type A personality.

The mere fact I'm still harping on this worries me that I am indeed a Type A. Then I wonder, what exactly is Type A? I'll cop to neurotic, and yea a hypochrondriac, but Type A? That can't be.

So my first Google search leads me to "Neurosis and Psychosis: Are They Really The Same?"

Good lord - now I have PSYCHOSIS in this bag of worry?

[Ed. note: If you're keeping score, the company site is still loading. We're going on 6 minutes now.]

From the above article:

"People who suffer from neurosis exhibit an excessive reaction to what others would deem minor stresses. This means that a neurotic individual worries over things that are of little importance or substance."

Well, that seems to fit.

Wikepedia has this about Type A:

Symptoms of Type A Behavior

An intrinsic insecurity or insufficient level of self-esteem, which is considered to be the root cause of the syndrome. This is believed to be covert and therefore less observable.
Time urgency and impatience, which causes irritation and exasperation.
Free floating hostility, which can be triggered by even minor incidents.

Well, this is perturbing. But if Type A means free-floating hostility then I can reconcile myself to that diagnosis as well.

[Ed. note: Still keeping score? Company site is still loading. We're going on 9 minutes now.]

I think I'll pick a fight with some clown who boards at Randolph, puts their bag on the aisle seat and fakes sleep. I was ready to punch some Hyde Park chick on yesterday's 5:18pm for that very thing. Today I'll let the free-floating hostility take over.

[P.S. Still keeping score? Company site is STILL loading. We're going on 11 minutes now. That free-floating hostility should be taking over any time now.]

This secret goes to the grave

2009-11-28T20:43:00.002-06:00

Wikileaks published several thousand text messages from 9/11.

Here's one:
2001-09-11 09:46:48 Arch [1399051] C ALPHA Sir, Pentagon just was hit by what looks to be fairly large bomb in vicinity of Heliport. Base has gone to threatcon "C" which essentially closes the base gates. Trying to get more info. [] 2001-09-11 10:00:19 Arch [1399051] C ALPHA Admiral, Call when able. We are going to TREATCON C. vr Nigel [] 2001-09-11 12:20:37 Arch [1399051] C ALPHA Admiral, Your mother called. vr Nigel []

The state secret revealed here: even admirals have mothers.

The DoJ is high on crack

2009-11-09T16:47:00.003-06:00

The Department of Justice wouldn't know an anticompetitive hookup if Standard Oil bit them in the face.

The Recession is over - hello, Depression!

2009-10-29T13:40:00.003-05:00

From the Bureau of Economic Analysis (BEA) report used to pronounce the recession is dead. They forgot to add "The Depression is here."

In the 1st paragraph the Bureau of Economic Analysis reports that 2Q GDP decreased 0.7%, but increased 3.5% in the 3rd quarter.
(Ed. note: No consecutive 4 quarters of growth here.)

In the 2nd paragraph the BEA hedges by saying source data is incomplete and the “second” estimate for 3Q will come out 11/24/09.
(Ed. note: Pretty sure that will be downward revisions – and not covered in the press.)

Motor vehicle output added 1.66% to 3Q – in other words, the cash-for-clunkers is responsible for almost half of GDP growth (as cited by BEA later in their report).

Real federal government consumption expenditures and gross investment increased 7.9 percent
in the third quarter, compared with an increase of 11.4 percent in the second.

Current-dollar personal income decreased $15.5 billion (0.5 percent) in the third quarter, in
contrast to an increase of $19.1 billion (0.6 percent) in the second.

Personal current taxes increased $4.8 billion in the third quarter, in contrast to a decrease of
$119.1 billion in the second.
(Ed. note: Income heading down, taxes heading up: not the recipe for recovery.)

Disposable personal income decreased $20.4 billion (0.7 percent) in the third quarter, in contrast
to an increase of $138.2 billion (5.2 percent) in the second.

Cue the Good Times.

The World Reacts (when pressed on it)

2009-10-03T23:57:00.003-05:00

New York City: Chicago Mourns, New York Sympathizes
From the New York Times:
“I think it’s a shame,” said Andrew MacNair, 60, an architect who lives on Central Park West. “It’s the sister city. It’s the cowboy town. We’re the sail port.”
Not exactly sympathy.
[A] majority of New Yorkers supported this city’s Olympic bid, contrary to the perception that New Yorkers cared little for the Games. But Chicago seemed particularly taken with the notion of hosting the Games, at least in terms of publicly expressed enthusiasm.
Actually, Chicago never crossed 50% of public support. Cf. Silver Shovel, Shakman Decree, Parking Meters, Chicago Skyway, Midway Airport, Christopher Kelly, etc.

Milwaukee, WI - Chicago's Failed Olympic Bid Hurt Wisonsin Tourism
Then make the Brewers a winning team, and get over Bret Favre already.

Kansas City, MO - Chicago's Defeat Riles Critics of USOC
"James Ravannack, the president of USA Wrestling, said: 'Resignations. It’s an absolute embarrassment. … Where is the leadership?'"
After making that statement, Mr. Ravannack got Daley into a half-nelson.

Reuters - Obama Olympics Ouch!
“We recognize that we need to do more to make it easier for legitimate visa applicants to make it to the U.S. We understand we have an image problem about that process,” [State Dept Spokesman] Kelly said.
Yes, that's right: it was the federal travel visa to blame.

Toronto, CA - Rio de Janiero Could Boost Toronto's Pan-Am Bid
"[T]hat South America has bagged the biggest sporting prize for the first time gives Toronto a slight edge over competitors Bogota, Colombia, and Lima, Peru, for the Pan American Games."
Is it too late for Chicago to make their pitch?

Chicago skates on this one

2009-10-02T10:32:00.002-05:00

And Chicago heaves a big sigh of relief.

Bears showed up at Pamplona

2009-09-25T15:44:00.005-05:00

The spirit of Generalissimo Franco is alive in Spain. A brigade of bears stalked the bulls at Pamplona, ate them, then ran amuck throughout Spain.

[The Hartford elk had no comment to this reporter.]

UK Telegraph

By Ambrose Evans-Pritchard

Published: 10:28PM BST 24 Sep 2009

Spain Tips Into Depression

The Madrid research group RR de Acuña & Asociados said the collapse of Spain's building industry will cause the economy to contract for the next three years, with a peak to trough loss of over 11pc of GDP. The grim forecast is starkly at odds with claims by premier Jose Luis Zapatero, who still says Spain's recession will be milder than elsewhere in Europe.

[Ed. note: Sound familiar, Americanos?]

RR de Acuña said the overhang of unsold properties on the market, or still being built, has reached 1,623,000 . This dwarfs annual demand of 218,000, and will take six or seven years to clear. The group said Spain's unemployment will peak at around 25pc, comparable to the worst chapter of the Great Depression.

[Ed. note: This is getting downright spooky.]

Separately, UBS said unemployment will reach 4.8m and may go as high as 5.4m if the job purge in the service sector gathers pace. There is the growing risk of a "Lost Decade" akin to Japan's malaise after the Nikkei bubble.

[Ed. note: OK, the joke's over. We're really talking about the United States, right?]

Roberto Ruiz, the bank's Spain strategist, said salaries must fall by 10pc in real terms to regain lost competitiveness, replicating the sort of wage squeeze seen in Germany after reunification.
There is no sign yet that either Spanish trade unions or the Zapatero government are ready for such draconian measures. Talks between the unions and Spain's industry federation (CEOE) broke down in acrimony in July.

[Ed. note: I hate to mention this, but - this is happening in the United States too.]

The Spanish government can do little to cushion the downturn. "The room for manouvre in fiscal policy has been exhausted," said Mr Ruiz.

[Ed. note: Bernanke, Geithner - did you catch that?]

Combined private and corporate debt reached 230pc of GDP, funded by French and German savings.

[Ed. note: Swap that for Japanese, Saudi Arabia, and of course - China.]

The Bank of Spain made heroic efforts to counter the effects of the bubble by forcing banks to put aside extra reserves, known as dynamic provisioning, but the sheer scale of the problem has washed over the defences.
Spain no longer has the escape valve of devaluation to claw back market share. It cannot resort to emergency monetary stimulus – as Switzerland, Britain, the US, and Japan are doing to prevent the onset of debt deflation. Prices are already falling at a rate of 1.2pc. [Emphasis mine.]

[Ed. note: That would also be known as DEFLATION, for all you inflation hawks out there.]

Patrick Swayze goes on one last Roadhouse-range

2009-09-15T22:08:00.000-05:00

You're reading it here first - Patrick Swayze, before succumbing to cancer grabbed the Costco-sized Bayer aspirin and wiped out Christopher Kelly, James McDonald, Finn Casperson, and Danny Pang.

Because somebody took them out of the corner and he put them right back in it, baby.

Struggling Borrowers Raise Risk of Credit Card Lending

2009-09-15T21:50:00.002-05:00

Some stray thoughts on FT's "Struggling Borrowers Raise Risk of Credit Card Lending."

That is, I was going to until I read THIS:
Please don't cut articles from FT.com and redistribute by email or post to the web.

No doubt I am now in big time trouble for redistributing THAT.

Once again, South Carolina contributes nothing but garbage

2009-09-10T08:14:00.003-05:00

Rep. Joe Wilson (SC-R) yelled "you lie" to President Obama during his health care speech Wednesday, 9 September 2009.

Unfortunately, the Congressman was stricken with laryngitis for the entire President Bush Administration and thus was unable to yell what a liar Bush was (is).

White Sox win their last game in Metrodome - take that, Joe Nathan!

2009-09-02T15:13:00.003-05:00

When you need to update your colleagues on a fast moving 9th inning and you have to make work's email function like Twitter.

*Notice there are no work emails sent during the 9th inning of the White Sox-Twins game.

The Cows Must Be Stopped

2009-08-02T16:17:00.001-05:00

It's not news until the NY Times decides it is, and they've decided it's news now.

Why, cows kill 20 people a year in the United States. That makes it more rampant than H1N1.

Cows must be stopped.

From the NY Times:

All but one of the victims died from head or chest injuries; the last died after a cow knocked him down and a syringe in his pocket injected him with an antibiotic meant for the cow. In at least one case the animal attacked from behind, when the person wasn’t looking. Older men with arthritis and hearing aids have the highest risk of being injured by livestock, the report says.

He who wields the cattle prod gets the hoof.

7/06/2009 Sports Economics update/Baseball

2009-07-06T12:32:00.002-05:00

Today's SPORTS ECONOMICS news.

And no, I'm not talking about the Cubs' sale.

Over the Fourth of July weekend it was reported that MLB is loaning millions of dollars to the Texas Rangers. Nolan Ryan is part of a group making an offer to purchase the team.
And because it's sports, the only way the Rangers can make any money is to win. Except, of course, they play in Arlington, TX. And we're not even into the Sahara-like days of July & August yet.

So let's wrap this up with a conspiracy theory on the All-Star Game: the Rangers' outfielder, Josh Hamilton, the Feel Good Story Of 2008, was on the DL for a good part of the first half this year. And yet, miraculously, he was voted by the fans to be a starter in the All-Star Game. By the same fans who don't go to games or watch them on TV or listen to them on radio.

Yeah, just like Evan Longoria of Tampa Bay was voted a starter by their non-existent fans last year.

What am I saying - internet voting can be rigged? Say it ain't so, Joe!

Narodna Odbrana's Holstein Cows division

2009-06-27T18:19:00.003-05:00

Hat tip to Guerrilla News Network:
Lesbian Animal Killer Trampled to Death by Holstein Cows

The man, who declined to give his name, said: “At first we thought nothing of it, but then we realised that something was not right.

“I looked outside and saw a herd of cows crowded round one area of the field.

“I knew something was wrong so I went outside, picked up a wooden post, which was nearby, and went to the cows and shooed them away.

“Then I saw a woman on the ground, with her head bent at an unnatural angle.”

Apparently the cows were like ninjas: They hemmed her in against a wall, squeezed the life out of her with their arses, and when she went down – tried to kick her fucking head off.

In Britain vets are right sick bastards. It’s nice to see some justice for once. I hope the cows shat on her face.

So, I had to check it out - was there a British vet killed by (Holstein) cows? And the answer is yes, yes there was, Mr. and Mrs. America.

If you see a herd of them coming down your street, you'll grab your bag a little tighter and cross the street, won't you? Admit it - you'll never take cows for granted again.

Once you have the scorecard

2009-06-20T16:21:00.002-05:00

The emerging stories on the Iranian election never smelled right - especially since it is a good idea to be skeptical of any concerted storyline being promulgated by American media.

But without knowing the Iranian backstory I was floundering. You really can't tell the players without a scorecard. Paul Craig Roberts managed to put everything together, succinctly and coherently.

To sum up: it was reported two years ago by several media outlets that the Bush Administration gave the CIA the green light to foment revolution in Iran.

Moussavi, the preferred candidate by Washington, announced HE was the winner before the polls closed. That makes Mahmoud Admadi Nejad a laggard, waiting hours after the polls closed to announce he won.

Paul Craig Roberts cites a Kenneth Timmerman, neocon, who spoke of a "green revolution" the day before the election.

Does that name ring a bell? Maybe you are thinking of Tim Timmerman - an alleged eyewitness to flight 77 crashing into the Pentagon who insisted it was the American Airlines plane.

Very probably just a coincidence, but strange.

Italian police make a long distance phone call

2009-06-15T22:21:00.005-05:00

The Italian police have asked the SEC to authenticate the $134 billion Treasury bonds found in a suitcase false bottom.

The SEC? The SEC?

Why - the Treasury Department was out to lunch?

This story is getting curiouser and curiouser.

And as the article points out - those two Filipino/Japanese/Other travelers were heading to a Swiss free port - legal limbo.

Calling Leo Wanta! Your tranche is here!

Oh dear, this IS awkward

2009-06-09T20:39:00.004-05:00

The Canadian Mint called in the RCMP. Seems they have misplaced some gold. Someone in a position to know how dirty Roland Burris is dies in a car accident. And then there's this:

Upstart Congress subpoenaed the Federal Reserve Bank.

The committee said it would "have a subpoena served on the Federal Reserve" as it tries to discover whether undue pressure was placed on Ken Lewis, chief executive of Bank of America, to complete an agreed deal to buy Merrill Lynch last year.

"We have received it," said the Fed. Cue the ominous silence.

One person familiar with the Fed's history could remember only one previous occasion in the past 20 years when it had been served with a subpoena. And then, suddenly, he couldn't remember it anymore.

Royal Canadian Mint misplaces gold. Or maybe not. Another atrocious example of spokespeople who suck at their jobs. Mint spokeswoman Christine Aquino said last week it could be anything from a heist to sloppy record-keeping.
And if that's how they take care of their gold, god save Canada. (Because the Queen can take care of her own gold.)

A troublemaker for (ahem) Senator Roland Burris dies in tragic - and convenient - car accident. The Sun-Times reports

"Ruff insisted that the only way to determine whether Burris lied about the circumstances of his appointment when appearing before an Illinois House impeachment panel was for prosecutors in Sangamon County and investigators overseeing a U.S. Senate ethics probe to zero in on [Burris’ business partner Fred] Lebed.
"There is more to be discovered," Ruff told the Sun-Times. "I know the key to finding the information out is through Fred. That's the main point I wish to get across.”

Very awkward.

6/08/2009 Sun-Times Monday wrap-up

2009-06-08T08:28:00.003-05:00

There we were, talking about the burgeoning civil war in Mexico and I read today about a shootout in Acapulco over the weekend.

China puts New Orleans Mayor Ray Nagin in quarantine. Ostensibly because someone on his flight exhibited flu symptoms. This could be a handy way to deal with troublesome officials from other countries.

And the headline story: Illinois' 529 college fund lost 38% due to a rogue trader at Oppenheimer. He decimated the most conservative fund, a govt bond fund, to the tune of 38%. Lisa Madigan and Alex Giannoulias have been negotiating with Oppenheimer in secret and have a handshake deal to get $77 million of $85 million lost (90.5%).
And now they're all mad because a family filed an arbitration claim against Oppenheimer for lost monies, PLUS damages and legal fees.

To that last story, I'm with the family.

I swear I can hear Louis Jordan's "Let The Good Times Roll" wafting gently through the air.

States reluctantly start hacking at budgets

2009-06-05T20:41:00.004-05:00

Well, not all states. California is still fulminating but I suspect behind closed doors ugly cuts are being discussed. Here in Illinois, the General Assembly gleefully disbanded and ran home. So, let's see what's going on elsewhere in the country.

Minnesota will begin unallotments on July 1, the beginning of their fiscal year. The state has a unique setup that mandates the governor to make cutbacks when the state's chief financial officer formally reports the state can't meet its budget. Their budget shortfall is so great that they have to make significant cutbacks.

Alabama home to bankrupt Jefferson County, is also making cuts. The poor, the elderly, and sick will bear the brunt of most of the cuts.

Meanwhile, Rep. Ron Paul's HR 1207 and Sen. Bernie Sanders S.604 - the Federal Reserve Sunshine Act of 2009 are sitting on Capitol Hill. The House and Senate versions are identical.
The House bill has 175 co-sponsors. Not one in the Senate.
The bill calls for an audit of the Federal Reserve system.

Ron Paul has acknowledged that he and his staff have received death threats.

The Fed has hired a lobbyist firm to gin up opposition to the House and Senate bills.

Not a single black Congressman from Illinois is supporting this legislation.

You can make a strong argument that blacks suffer disproportionately from Fed policies - certainly no less than other middle-, working-, and poor classes. And yet, nowhere to be found.

Oh, and the Sox are losing to Cleveland 4-0 at the time of this writing.

Is Hell Starting To Break Loose?

2009-05-27T12:34:00.002-05:00

Dateline Chicago, Wednesday 27 May 2009

[WSJ] At least 30 people died and dozens were wounded in an explosion at a police building in the eastern Pakistani city of Lahore.

North v South
Korea, that is.

Can we bring M*A*S*H back, picking up with today's events?

North Korea says the 1953 Truce is OFF.

S. Korean President Lee Myung-Bak already had problems, trying to head off herds of mourners for the former President Roh Moo-hyun, who leapt to his death last Saturday (23 May 2009). From the Korea Times article:
"They [Seoul] didn't rule out the possibility that ongoing mourning parades could develop into anti-government rallies, with a large number of Roh's supporters believing the former head of state had fallen prey to a politically motivated investigation by the prosecution, which they say is under President Lee Myung-bak's control. "

Good news: the market is only down 0.6% at the time of this writing.

Did we mention that Japan's going to get back into the weapons game?

Ha'artz editorial reports that Netanyahu is bringing Israel closer to war with Iran. From the article:
"Netanyahu said that if Israel does not lead the defense against the Iranian threat and bring in the United States and other countries, no one else will."

This just in: North Korea says truce is still broken.

More good news - WWIII not too far off now

2009-05-26T10:04:00.000-05:00

Japan is going to lift their self-imposed ban on weapons manufacturing.

They're doing it to save their economy, and while the obvious parallel is Hitler's Germany, ca. 1930s, I see the Ango-German naval arms race leading to WWI as a better blueprint.

In the years prior to the big breakout, there were the regional conflagerations (Boer War, Boxer Rebellion, Spanish-American War, Balkan War(s) - with all the Great Powers either directly or indirectly by proxy involved.

My question: is there anybody out there who fails to see this as a major step forward to WWIII?

Second question: Are we going to skip worrying about a deepening depression and go straight to worrying about another Bataan Death March?

Goldman Sachs isn't wearing any clothes

2009-05-14T22:55:00.002-05:00

Reading the comments of Mish's most recent post today, on the Rapid Decline And Fall of California and I find I've strayed was off the reservation.

A lot of the commenters (and Dealbreaker was toeing the same line) were barking how Paulson made the banks take TARP money last autumn. And then had the gall - the gall! - to make it difficult for them to give the money back.

And I'm thinking: are you f*cking kidding me? The banksters at that Paulson/Bernanke BBQ were telling them how it was going to go down. And the cover story would go something like this: Treasury/Fed is making all the banks take money so no one institution is singled out. Also recall that nothing was said at the time about paying the money back.

Now fast forward to the outrage over AIG bonuses while billions fell out the back door to Goldman Sachs et al, making their bets whole. (By the way, there's more to that bonus story, starting with that Cassano dude - it isn't the red herring cynics think it is.)

Goldman Sachs, knowing the script, then claimed they wanted to pay their TARP money back but Washington wouldn't let them.

Now I'm thinking: if you don't have the money to pay back gigantic sums of moolah, the public is ticked off about same said moolah, you then claim "I'm ready to pay it back. Oh, wait - Treasury says no. Nuts."
How HANDY. Deus ex machina.

And unbelievably enough - tons of people are buying it! People who should know better. Crikey.

I think of that fable of "The Emperor's New Clothes" and shake my head.

About those green shoots

2009-05-08T14:25:00.002-05:00

Are we talking about dusky green, dried shoots? Maybe encapsulated in a rolling paper?

From the San Jose Mercury News:

SANTA CRUZ -- Call it a threat or a grim reality. Whatever it is, it's not being welcomed at city halls across California.

The governor's office suggested this week that if the May 19 budget-reform measures are rejected by voters, the state will have to borrow $2 billion from cities and counties.

The proposal, which comes as polls show little hope for the ballot measures, is being met with horror by local governments that face red ink of their own.

"Our budget gap is so big it's beyond anything we could have imagined already," said Santa Cruz City Manager Dick Wilson. "If the state adds this additional burden, it's overwhelming. ... It's appalling beyond words."

And TrimTabs doesn't see any green shoots either:

Sausalito, CA - May 6th, 2009 - TrimTabs Investment Research estimated today that the U.S. economy shed 745,000 jobs in April as wages and salaries plunged an adjusted 5.7% year-over-year. TrimTabs estimated that the economy shed a record 5 million jobs in the past 12 months.

That's somewhat at odds with BLS's report:

Nonfarm payroll employment continued to decline in April (-539,000), and the unemployment rate rose from 8.5 to 8.9 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Since the recession began in December 2007, 5.7 million jobs have been lost. In April, job losses were large and widespread across nearly all major private-sector industries. Overall, private sector employment fell by 611,000.

To sum up, TrimTabs says 745k jobs lost in April '09.
BLS says 611k.
Difference: 134k.
[Ed. note: Expect to see a large revision upwards next month for the April numbers.]

TrimTabs says 5 million jobs lost since April '08 (past 12 months).
BLS says 5 million jobs lost since December '07.
Difference: BLS claims it has taken 17 months to lose 5 million.
[Ed. note: The BLS are liars.]

TrimTabs doesn't say what they think the unemployment rate is, but we know BLS's 8.9% rate is crapola.

Mexican swine flu gets curiouser and curiouser

2009-04-27T14:51:00.003-05:00

At the time of this posting, Mexican deaths from swine flu are at 149.

Baxter International, one of the companies trying to get a vaccine for this flu to market, was involved in a botched shipment of bird flu to an Austrian lab in February 2009.

The company [Baxter Intl] that released contaminated flu virus material from a plant in Austria confirmed Friday that the experimental product contained live H5N1 avian flu viruses.

And then there's this reported today (4/27/2009) from the UK Independent:

Felipe Solis, a distinguished archaeologist who showed Mr Obama around the city's anthropology museum during his visit to Mexico earlier this month, died the next day from "flu-like symptoms".

And from the "when it rains, it pours" file: Earthquake hits southern Mexico, about 250km from the capital.

And from the "random noise file:" The WSJ is all over a low-flying plane cruising Manhattan for a photo-op. From the WSJ:

A low-flying airplane escorted by military jets sent worried workers fleeing offices in the New York City area. The FAA said it was a "photo op" conducted by the Air Force.

An old Spanish tradition, 21st century style

2009-04-21T16:25:00.002-05:00

From the 4/20/2009 New York Times:

The nation’s jobless rate, already a painful 15.5 percent, could soon reach 20 percent, a troubling number for a major industrialized country.

With the combination of rising unemployment and falling prices, economists fear Spain may be in the early grip of deflation, a hallmark of both the Great Depression and Japan’s lost decade of the 1990s, and a major concern since the financial crisis went global last year.

In other news, Pamplona's running of the bears is still on for this July.

Today's Market Report

2009-04-20T14:31:00.001-05:00

While the market is taking a break from the bear market rally, I'll take this opportunity to pass on all sorts of stuff.

Treasury Dept's stress test results leaked.
Here's the important sentence: Of the top nineteen (19) banks* in the nation, sixteen (16) are already technically insolvent.

*Don't forget, the investment banks (Morgan Stanley & Goldman Sachs) converted to commercial banks to cash in on the Fed's largesse last fall.

What does this mean?
This means it is not a subprime crisis. Trixie & Bubba buying a McMansion they couldn't afford didn't cause this problem, nor are they even the most important part of the problem.
This is not a liquidity crisis. That is, the banks would be fine if only they had access to cash. Why, in that case, every homeless person is experiencing a liquidity crisis.
IT IS A SOLVENCY CRISIS. To put it bluntly, the United States is bankrupt. And BushObama policies are saving Wall Street and throwing the rest of us to the wolves.

What two-party system?
Rep. Jane Harman (D-CA) assisted AIPAC* in attempting to reduce espionage charges (see Jack Abramoff) back in 2006. CQ's Jeff Stein's scoop is that then-Attorney General Alberto Gonazles intervened to kill the criminal investigation into Harman -- even though DOJ lawyers had concluded that she committed crimes -- because top Bush officials wanted Harman's credibility to be preserved so that she could publicly defend the Bush administration's illegal warrantless eavesdropping program.
*See Sibel Edmonds on AIPAC.

Prepare for (much) higher food prices.
Somewhat of a perfect storm (pardon the pun) is coalescing. The meteoric rise of commodity prices last year priced farmers out of fertilizer for this year's crop. This translates to fewer acreage and reduced yields per acre.
Add to that bad weather, such as hard freeze across the U.S.'s wheat belt. In Oklahoma 60% to 90% of the spring wheat crop is wiped out.

The next shoe(s) to drop.
Pensions and commercial real estate are rapidly approaching critical mass in terms of mass financial destruction. General Growth Properties filed for bankruptcy last week. So did Six Flags (debt restructuring). In the flash of an eye, the shopping mall model fell apart and left GGP with debt it couldn't roll over.
Moody's downgraded all municipal debt, which translates into states & local governments experiencing more problems financing their debt. This will translate into higher taxes, "fees*," and services getting cut.
*For example, the City of Chicago emailed me, to remind me not to forget my city sticker in June. And not to forget my dogs need city dog licenses. Very helpful, those Department of Revenue people.

And finally, the lesson we need to relearn: everybody in the market is lying. Exhibit A: Citigroup's so-called earnings report. They stated they lost $966 million in the first quarter. And that's in spite of Titanic-sized cash infusions from Washington. Worse, they lost more than that but courtesy of accounting tricks the loss may have been well north of $3.5 billion.
[Dealbook] Citigroup posted a $2.5 billion gain because of an accounting change adopted in 2007. Under the rule, companies are allowed to record any declines in the market value of their own debt as an unrealized gain because a company COULD buy back its own debt at a discount.

Then there's FASB caving under pressure and letting mark-to-model back into the game. But I'll save that for another rant.

Citi suckers investors. Again.

2009-04-02T13:13:00.000-05:00

Yesterday an analyst at Citi advised buying May puts on XLF - to rephrase, to bet against itself.

Mish wrote this up and added "I'm not bullish on financials, but considering Citi hasn't gotten anything right, this might be a good time to buy."

Then the mark-to-market news broke today and financials took off, including XLF. So much for those May puts.

London's CCTV ruled illegal

2009-03-31T15:10:00.002-05:00

Actually, the important part of the article is here:

The security operation at this week's G20 summit was thrown into chaos last night when it emerged that the entire network of central London's wireless CCTV cameras will have to be turned off because of a legal ruling.

I don't think all of the security operation was thrown for a loop. The CCTV network was turned off for the 7.07.2007 terrorism exercise in London as well.

Meanwhile, Chicago should take heed of that ruling (most monitored city in the United States).

The Globe & Mail, among other outlets, reports that London is battering down the hatches in fears of violent protests.

Are we getting set up for something?

Ed. note: The answer is YES.

Ha, and double ha!

2009-03-31T12:30:00.002-05:00

I was gently chastised last week for missing the forest on my outrage at AIG bonuses last week.

And now it turns out that there's more, much much more to those bonuses.

And now a gentle reminder: I am perfectly capable of maintaining outrage at several entities simultaneously and over long periods of time. Which is I why I maintain my Arch Enemies List (and you're still on it, DuPage County).

The IRA tricks S&P into downgrading Ireland

2009-03-30T14:19:00.000-05:00

Those diabolical bastards.

Of all places

2009-03-27T14:34:00.000-05:00

Of all places, FT had this headline:

Miners Lead Footsie Lower

They couldn't just stick with FTSE?

From the "Can't Make This Stuff Up" files

2009-03-25T20:50:00.002-05:00

OTARU, Japan, March 25 (Reuters) - Bank of Japan Deputy Governor Hirohide Yamaguchi said on Wednesday he would not completely rule out the possibility of cutting interest rates further from an already low 0.1 percent.

That's right: Dep. Governor Yamaguchi sees room to maneuver on lowering the interest rate FROM 0.1.

Well, if they make microscopic transistor radios, why not do the same with interest rates?

Rep. Luis Gutierrez Hits the Trail

2009-03-25T15:01:00.003-05:00

So glad Rep. Luis Gutierrez (D-IL) picked DETROIT as part of his 5-week tour promoting amnesty for illegal aliens.

Nothing people like hearing more while dealing with crushing unemployment is a Congressman pitching a renewed effort to add illegals to the workforce.