It seems that sometimes private enterprise does a lot more good then they are given credit for. I shop at Walgreens just about everyday to buy my lunch or snacks. Too bad there is no Take-Care clinic in that store.
Individuals must prove they are receiving or will receive government unemployment benefits in order to qualify for the free services, which are being offered weekdays from 11 a.m. to 3 p.m. If a participant finds a new job or health insurance, that person and his or her family will no longer qualify.
Also Quest Diagnostics is chipping in with some freebies as well.
Quest Diagnostics Incorporated (NYSE: DGX: 47.31, 0.18, 0.38%), the world's leading provider of diagnostic testing, information and services, will provide strep and urine cultures and other select laboratory testing services for free to qualified patients served through the Take Care Recovery Plan, which is an offer, announced by Walgreens (NYSE, Nasdaq: WAG) and Take Care Health Systems, to provide free health care services at Take Care Clinics. The offer is available to qualified patients, including Take Care Clinic patients, and their immediate family members, who lose their job on or after March 31, 2009, and are uninsured. The offer runs through the end of the year.
Tuesday, March 31, 2009
Friday, March 27, 2009
KB Homes Builds Houses For A New America: Is it the Rise of the Netbook Home?
It seems that the McMansion may be dead according to this article. It also seems that KB Home is finally starting to sell more houses but they are much smaller and more affordable according to their earnings statements.
Half of all KB Home's sales this year are expected to come from its new Open Series blueprint, a smaller and less expensive model the company unveiled to compete with discounted foreclosed homes. KB Home is offering the Open Series in 30 communities, including some in southern California, North Carolina, Tucson, Ariz., Orlando, Fla., and Houston.
"Homes must change with the times," Mezger said. "It is not simply about reducing prices. It is about increasing value to the consumer."
These smaller homes helped make new home buyers account for 70% of KB Homes revenue this past quarter. These homes show that there is pretty decent demand out there for the right kind of home.
It kind of reminds me of the rise of the Netbook. For a while we had these massive laptops that cost thousands of dollars that made DVDs, played games, allowed you to edit movies, etc. HP and Dell's margins were great and people were buying them like crazy. Then when hard times hit people finally understood that for $300 you can do everything that you actually used laptops to do like browsing, email, carrying the thing in your bag, etc.
These Open Series blueprint homes are kind of the same thing. They hopefully get home buyers back to what they *should* be looking for in a home. A nice place to keep your stuff and live your life while you raise your family.
Your home is not an investment you can flip. It is not a piggy bank you can tap to finance a lifestyle on 100% credit. It is certainly is not a place where you can pretend to be rich and famous. That means no more eating off of a granite countertop, getting beers from your Sub-Zero freezer, and pooping in one of your 6 toilets while you forget about your interest-only ARM resetting next month. It seems fitting that the Netbook Age should follow so closely after the Age of Excess.
Half of all KB Home's sales this year are expected to come from its new Open Series blueprint, a smaller and less expensive model the company unveiled to compete with discounted foreclosed homes. KB Home is offering the Open Series in 30 communities, including some in southern California, North Carolina, Tucson, Ariz., Orlando, Fla., and Houston.
"Homes must change with the times," Mezger said. "It is not simply about reducing prices. It is about increasing value to the consumer."
These smaller homes helped make new home buyers account for 70% of KB Homes revenue this past quarter. These homes show that there is pretty decent demand out there for the right kind of home.
It kind of reminds me of the rise of the Netbook. For a while we had these massive laptops that cost thousands of dollars that made DVDs, played games, allowed you to edit movies, etc. HP and Dell's margins were great and people were buying them like crazy. Then when hard times hit people finally understood that for $300 you can do everything that you actually used laptops to do like browsing, email, carrying the thing in your bag, etc.
These Open Series blueprint homes are kind of the same thing. They hopefully get home buyers back to what they *should* be looking for in a home. A nice place to keep your stuff and live your life while you raise your family.
Your home is not an investment you can flip. It is not a piggy bank you can tap to finance a lifestyle on 100% credit. It is certainly is not a place where you can pretend to be rich and famous. That means no more eating off of a granite countertop, getting beers from your Sub-Zero freezer, and pooping in one of your 6 toilets while you forget about your interest-only ARM resetting next month. It seems fitting that the Netbook Age should follow so closely after the Age of Excess.
Reid Tells MoveOn to Drop Ads that Go After Dem Moderates
I think Reid is afraid that these people will jump ship and join with moderate republicans to from a powerful voting block.
Sen. Harry Reid, D-Nev. wants liberal groups who are targeting Democrats over the budget to back down.
The left-leaning Americans United for Change and MoveOn.Org have been airing advertisements on the radio and Internet in a dozen states that are home to both Republican and Democratic lawmakers who have not made up their minds about whether to back Obama's s slightly pared-down budget proposals next week.
I think it would be up to these Senate moderates to keep our debt from choking us out in less then a decade. I mean the Red Chinese have only so much patience when it comes to this kind of thing. I mean with high debt levels there comes high interest rates that make the value of their trillion dollars in bonds that much lower. So I think it comes down to Obama wanting alot of fancy spending and the Red Chinese shaking their heads "No."
Sen. Harry Reid, D-Nev. wants liberal groups who are targeting Democrats over the budget to back down.
The left-leaning Americans United for Change and MoveOn.Org have been airing advertisements on the radio and Internet in a dozen states that are home to both Republican and Democratic lawmakers who have not made up their minds about whether to back Obama's s slightly pared-down budget proposals next week.
I think it would be up to these Senate moderates to keep our debt from choking us out in less then a decade. I mean the Red Chinese have only so much patience when it comes to this kind of thing. I mean with high debt levels there comes high interest rates that make the value of their trillion dollars in bonds that much lower. So I think it comes down to Obama wanting alot of fancy spending and the Red Chinese shaking their heads "No."
Thursday, March 26, 2009
GOP Pushes Their Own Budget Plan
At last the so-called "Party of No" is morphing into the party with their own plan.
So the entire House GOP elected leadership will join Rep. Paul Ryan (R-Wis.), the ranking member of the Budget Committee, for Thursday’s event. “It’s the old ‘I want to see it in writing,’” said a top House Republican official. “They’re going to see it in writing.”
Another official said: “We need to hold something up and say, ‘Here are our charts. Here are our graphs. It’s real.’”
Now they need to hit hard on the part about Congress stripping the tax cut for 95% of Americans from their version of the budget. They need to offer a steeper tax cut for those 95% and say that the Dems want to tax you to death when you can barely keep your head above water.
Then say something like "We are following plans from that great tax-cutter: Bill Clinton. You thought I was going to say Ronald Reagan right?" Then point out that the Clinton's 1997 tax cuts ushered in years of prosperity and growth. In other words use Clinton against the Dems in order to bolster the pro-tax cut position. So whenever someone squawks about "tax cuts for the wealthy" just say Bill Clinton understood that cutting taxes for everyone creates prosperity.
About 57% of the net Clinton tax cuts would go to families in the middle and fourth income quintiles. This compares to only 18% under the House tax plan and 21% under the Senate plan.
Taxpayers in the bottom 40% of the income scale would receive, on average, no benefit from Clinton's proposed tax cuts. Those in the bottom 20% would pay higher taxes, and those in the second 20% would pay about the same as now. The small income tax cuts in these groups are more than offset by higher excise taxes, primarily on airline tickets and cigarettes. In this regard, the Clinton plan is similar to its congressional counterparts.
The top 5% of taxpayers would receive 13% of the tax cuts under the Clinton plan. In contrast, the House plan offers 56% of its tax cuts to the top 5%, and the Senate plans offers 53%.
So the entire House GOP elected leadership will join Rep. Paul Ryan (R-Wis.), the ranking member of the Budget Committee, for Thursday’s event. “It’s the old ‘I want to see it in writing,’” said a top House Republican official. “They’re going to see it in writing.”
Another official said: “We need to hold something up and say, ‘Here are our charts. Here are our graphs. It’s real.’”
Now they need to hit hard on the part about Congress stripping the tax cut for 95% of Americans from their version of the budget. They need to offer a steeper tax cut for those 95% and say that the Dems want to tax you to death when you can barely keep your head above water.
Then say something like "We are following plans from that great tax-cutter: Bill Clinton. You thought I was going to say Ronald Reagan right?" Then point out that the Clinton's 1997 tax cuts ushered in years of prosperity and growth. In other words use Clinton against the Dems in order to bolster the pro-tax cut position. So whenever someone squawks about "tax cuts for the wealthy" just say Bill Clinton understood that cutting taxes for everyone creates prosperity.
About 57% of the net Clinton tax cuts would go to families in the middle and fourth income quintiles. This compares to only 18% under the House tax plan and 21% under the Senate plan.
Taxpayers in the bottom 40% of the income scale would receive, on average, no benefit from Clinton's proposed tax cuts. Those in the bottom 20% would pay higher taxes, and those in the second 20% would pay about the same as now. The small income tax cuts in these groups are more than offset by higher excise taxes, primarily on airline tickets and cigarettes. In this regard, the Clinton plan is similar to its congressional counterparts.
The top 5% of taxpayers would receive 13% of the tax cuts under the Clinton plan. In contrast, the House plan offers 56% of its tax cuts to the top 5%, and the Senate plans offers 53%.
Red Chinese Say "Let a Million Solar Panels Bloom!"
It seems that the Red Chinese are getting serious when it comes to a renewable future.
According to a statement on a Chinese government website, solar projects larger than 50 kilowatts of output will be eligible for a subsidy of about $2.90 per watt.
"We believe meaningful upside potential exists if government support for domestic solar sector continues," a Barclays analyst wrote in a research note, adding the move could boost Chinese demand by about 200 megawatts starting in the second half of 2009, a nearly four-fold increase from Barclays' projection for this year.
That $2.90 per watt figure is supposed to cover 60% of the cost of installing these things. So suddenly the biggest market in the world is now subsidizing the cost of their own solar panels. The Chinese don't do these things by half measures and the potential for solar penetration in China is vast. Imagine how many solar plants could be built in the Gobi desert alone?
This should be great news for Chinese solar companies which have been hammered with both Germany and Spain falling into recessions. Chinese solar stocks which went ape today. Shorts get out now because the solar space will jump off this news.
Chinese-based companies were the biggest gainers, with Trina Solar Ltd (TSL.N) up 40 percent at $12.14 per share, Suntech Power Holdings (STP.N), up 40 percent at $10.96, LDK Solar Co (LDK.N), up 36 percent at $8.00, Yingli Green Energy (YGE.N) up 39 percent at $5.75, Solarfun Power Holdings (SOLF.O) up 26 percent at $4.48 and Canadian Solar (CSIQ.O), up 23 percent at $5.95
According to a statement on a Chinese government website, solar projects larger than 50 kilowatts of output will be eligible for a subsidy of about $2.90 per watt.
"We believe meaningful upside potential exists if government support for domestic solar sector continues," a Barclays analyst wrote in a research note, adding the move could boost Chinese demand by about 200 megawatts starting in the second half of 2009, a nearly four-fold increase from Barclays' projection for this year.
That $2.90 per watt figure is supposed to cover 60% of the cost of installing these things. So suddenly the biggest market in the world is now subsidizing the cost of their own solar panels. The Chinese don't do these things by half measures and the potential for solar penetration in China is vast. Imagine how many solar plants could be built in the Gobi desert alone?
This should be great news for Chinese solar companies which have been hammered with both Germany and Spain falling into recessions. Chinese solar stocks which went ape today. Shorts get out now because the solar space will jump off this news.
Chinese-based companies were the biggest gainers, with Trina Solar Ltd (TSL.N) up 40 percent at $12.14 per share, Suntech Power Holdings (STP.N), up 40 percent at $10.96, LDK Solar Co (LDK.N), up 36 percent at $8.00, Yingli Green Energy (YGE.N) up 39 percent at $5.75, Solarfun Power Holdings (SOLF.O) up 26 percent at $4.48 and Canadian Solar (CSIQ.O), up 23 percent at $5.95
White House Debuts Financial Overhaul: My Comments
I think we may see a totally different Wall Street in a few years depending on what Congress passes in the next few weeks. Here are the major changes that the Treasury is putting forward and my comments.
• Imposing tougher standards on financial institutions judged to be so big that their failure would represent a risk to the entire system.
I wonder if this will stop certain companies from merging into a "system risking" company? I can see the SEC trying to stop certain companies from merging on the basis of the "too big to fail" rule. So the days of an American company like Citi or AIG becoming a world financial behemoth might be over.
• Extending federal regulations for the first time to all trading in financial derivatives, exotic financial instruments such as credit default swaps that were blamed for much of the damage in the meltdown.
This is one of those things that should have been done years ago and could have saved us from the meltdown. No market that trades in the trillions of dollars should go unregulated. I'm sure someone might have caught AIG loading up on those CDS (and shorted AIG to the hilt) years ago if this market was more transparent.
• Requiring hedge funds and other private pools of capital, including private equity funds and venture capital funds, to register with the Securities and Exchange Commission if their assets exceed a certain size. The threshold amount has yet to be determined.
I wonder if this will drive the hedge fund industry offshore in order to avoid this requirement and still keep their level of secrecy? If it is worded to say that any hedge fund trading in a US market (or that hold equities or debt in American companies) must register then they might not have a choice. This rule might drive many pools of capital to domicile in Switzerland instead of the US.
• Creating a systemic risk regulator to monitor the biggest institutions. Geithner did not designate where such authority should reside, but the administration is expected to support awarding this power to the Federal Reserve.
I wonder what this departments job entails? Will they step in whenever some sort of risk threshold is met and nationalize the company? Also what is the definition of "biggest institutions?" Will this SRR step in if it sees GE trying to throw billions into an expensive startup like semiconductors? So will they dictate what new nations a company tries to enter because the regional risk is too high? Lots of questions that need to be answered or this might curtail almost all risk taking by these biggest institutions.
• Imposing tougher standards on financial institutions judged to be so big that their failure would represent a risk to the entire system.
I wonder if this will stop certain companies from merging into a "system risking" company? I can see the SEC trying to stop certain companies from merging on the basis of the "too big to fail" rule. So the days of an American company like Citi or AIG becoming a world financial behemoth might be over.
• Extending federal regulations for the first time to all trading in financial derivatives, exotic financial instruments such as credit default swaps that were blamed for much of the damage in the meltdown.
This is one of those things that should have been done years ago and could have saved us from the meltdown. No market that trades in the trillions of dollars should go unregulated. I'm sure someone might have caught AIG loading up on those CDS (and shorted AIG to the hilt) years ago if this market was more transparent.
• Requiring hedge funds and other private pools of capital, including private equity funds and venture capital funds, to register with the Securities and Exchange Commission if their assets exceed a certain size. The threshold amount has yet to be determined.
I wonder if this will drive the hedge fund industry offshore in order to avoid this requirement and still keep their level of secrecy? If it is worded to say that any hedge fund trading in a US market (or that hold equities or debt in American companies) must register then they might not have a choice. This rule might drive many pools of capital to domicile in Switzerland instead of the US.
• Creating a systemic risk regulator to monitor the biggest institutions. Geithner did not designate where such authority should reside, but the administration is expected to support awarding this power to the Federal Reserve.
I wonder what this departments job entails? Will they step in whenever some sort of risk threshold is met and nationalize the company? Also what is the definition of "biggest institutions?" Will this SRR step in if it sees GE trying to throw billions into an expensive startup like semiconductors? So will they dictate what new nations a company tries to enter because the regional risk is too high? Lots of questions that need to be answered or this might curtail almost all risk taking by these biggest institutions.
Wednesday, March 25, 2009
OnLive Seems Like a Good Idea: It Might Be 5 Years Too Early
There seems to be a new online streaming game system that might be a serious competitor to console and computer games.
What if you could stream top-end games to your TV, just like a Youtube video that you can control? You'd never need to buy a console again.
That's the future envisaged by Palo Alto startup OnLive, which plans to launch a groundbreaking gaming service this winter. OnLive will supply players with a small set-top box, not much bigger than a Nintendo DS, which will plug into your TV and your home broadband connection. From there, you can start playing games just like those on the Xbox 360, PS3 or PC -- but with no install time, no waiting for downloads, and no need for big, noisy, expensive consoles cluttering up your living room. OnLive's service can be continually upgraded, too, so you'll never be stuck with obsolete hardware again.
The article goes on to say that the system is only as good as your broadband connection since it will stream both the game and the netcode for online play. I complain about lag all the time and I am running the game off of the console. Imagine if I had to stream an HD game as well as run the netcode. I would be a sitting duck in a game like Call of Duty 4.
They also point out that your ISP might throttle your connection if you are a heavy user of this device. That is where I think this thing is 5 years too early. Right now I would guarantee that your connection will start to degrade as soon as you plug this thing in and they inspect your packets. Any way you slice it you will be hogging a ton of bandwidth and your ISP will come down hard on you.
However, in 5 years ISPs will most likely have faster networks that will be able to handle streaming HD gaming over the net. I hope this thing survives until that time because we *will* be seeing Microsoft, Nintendo, and Sony try to stream games since it kills the pirating problem dead. The odd man out will be GameStop who ends up looking like Blockbuster if they don't plan for this thing.
Here is a pic of the setup. The controller looks kind of clunky but if all you need to connect to the thing is that little card then it is quite an elegant solution.
What if you could stream top-end games to your TV, just like a Youtube video that you can control? You'd never need to buy a console again.
That's the future envisaged by Palo Alto startup OnLive, which plans to launch a groundbreaking gaming service this winter. OnLive will supply players with a small set-top box, not much bigger than a Nintendo DS, which will plug into your TV and your home broadband connection. From there, you can start playing games just like those on the Xbox 360, PS3 or PC -- but with no install time, no waiting for downloads, and no need for big, noisy, expensive consoles cluttering up your living room. OnLive's service can be continually upgraded, too, so you'll never be stuck with obsolete hardware again.
The article goes on to say that the system is only as good as your broadband connection since it will stream both the game and the netcode for online play. I complain about lag all the time and I am running the game off of the console. Imagine if I had to stream an HD game as well as run the netcode. I would be a sitting duck in a game like Call of Duty 4.
They also point out that your ISP might throttle your connection if you are a heavy user of this device. That is where I think this thing is 5 years too early. Right now I would guarantee that your connection will start to degrade as soon as you plug this thing in and they inspect your packets. Any way you slice it you will be hogging a ton of bandwidth and your ISP will come down hard on you.
However, in 5 years ISPs will most likely have faster networks that will be able to handle streaming HD gaming over the net. I hope this thing survives until that time because we *will* be seeing Microsoft, Nintendo, and Sony try to stream games since it kills the pirating problem dead. The odd man out will be GameStop who ends up looking like Blockbuster if they don't plan for this thing.
Here is a pic of the setup. The controller looks kind of clunky but if all you need to connect to the thing is that little card then it is quite an elegant solution.
Gang of 15 Moderate Senate Democrats Now in Cat Bird Seat
It seems that these moderate Democrats can now pretty much block or pass anything that Obama wants to enact.
Sen. Evan Bayh, D-Ind., announced on MCNBC's "Morning Joe" this morning that he has formed a gang of 15 Democrats - yes, Democrats - in the Senate to essentially try to keep President Obama in check. The group is sending a message to the White House to not expect them to rubber stamp every proposal sent down Pennsylvania Avenue, particularly when it comes to spending, and that maybe Obama is trying to do too much, too fast. And since it takes 60 votes to get much done in the Senate, this group could be critical and essentially control the outcome of many pieces of legislation in the Senate.
They should think about joining with a number of moderate Republicans and forming a Centrist coalition. Maybe it will bring some sanity back to a too damn partisan Washington.
Sen. Evan Bayh, D-Ind., announced on MCNBC's "Morning Joe" this morning that he has formed a gang of 15 Democrats - yes, Democrats - in the Senate to essentially try to keep President Obama in check. The group is sending a message to the White House to not expect them to rubber stamp every proposal sent down Pennsylvania Avenue, particularly when it comes to spending, and that maybe Obama is trying to do too much, too fast. And since it takes 60 votes to get much done in the Senate, this group could be critical and essentially control the outcome of many pieces of legislation in the Senate.
They should think about joining with a number of moderate Republicans and forming a Centrist coalition. Maybe it will bring some sanity back to a too damn partisan Washington.
Tuesday, March 24, 2009
Is There a Major Stock Market Rally Brewing?
James Kostohryz thinks so. And he is putting his money where his mouth is. His reasoning is very sound and is mostly based on overreaction by big investors and behavioral factors. His window of opportunity will be from March to June.
As most of you know, on March 2, on the Buzz & Banter, I announced that I was initiating a 50% long position in US equities (from 10%) with the S&P at roughly 700. On March 5, with the S&P at around 680, I implemented a 100% long position.
I've maintained this core position since then and have traded around it using leverage. Since then, I've reiterated various times that I believe that the market has put in an important intermediate term bottom, and that the market will experience a major countertrend rally.
Here are his tells to show you the rally is underway:
1. Oil, basic materials, industrials and transportation outperform due to a belief that the global contraction has bottomed out. Watch IYM which is trading at 36.17 for this tell. This one may have already been hit because IYM has outperformed the S&P500 in the last few months.
2. Corporate Debt Spread Contract as TALF, TARP, toxic debt triage plan etc. starts to help credit markets. The tells here are LQD which is trading at $93.10, CFT at $90.64, JNK at $29.30 , and HYG at $69.30. All of these ETFs have been recovering nicely from their lows and are a few points higher.
3. Emerging Markets Outperform. The tell here is EEM which has gone from 19 to 26 since March 2nd.
4. VIX goes below 40 and stays there. This one is pretty close because the VIX is at 42.93.
5. Rising Put/Call Ratios. This is the wall of worry the market needs to climb to go higher.
6. Export Data from Japan and Asia get better. Japanese Imports and Exports are dropping like a rock but they are now carrying an unexpected trade surplus of Y82.4 billion. Chinese exports are in the dumper as well, going down 25.7% from a year earlier. These numbers seem to be near rock bottom so hopefully they won't get much worse. March will tell the tale.
7. Job losses begin to slow down or even stop. I think this will probably be one of those things where economists call for a big drop and instead there is little to no drop and everyone is surprised. Then Obama will say that the stimulus is working.
8. Commodities prices start to stabilize with oil at $55-$60. Two tells here (that are fairly liquid) are GSG and DJP. Both of these are commodities Index ETFs.
9. "Disappointing" pre-announced earnings that don't tank the stocks. Look for signs of stabilization in earnings as companies forecast the rest of the year.
10. Shrill bears calling it a "sucker's rally" etc. This is a contrarian indicator that tells you that the louder and more dogmatically they complain the higher the wall of worry becomes. Then if you see them switch sides you know the rally is underway.
As most of you know, on March 2, on the Buzz & Banter, I announced that I was initiating a 50% long position in US equities (from 10%) with the S&P at roughly 700. On March 5, with the S&P at around 680, I implemented a 100% long position.
I've maintained this core position since then and have traded around it using leverage. Since then, I've reiterated various times that I believe that the market has put in an important intermediate term bottom, and that the market will experience a major countertrend rally.
Here are his tells to show you the rally is underway:
1. Oil, basic materials, industrials and transportation outperform due to a belief that the global contraction has bottomed out. Watch IYM which is trading at 36.17 for this tell. This one may have already been hit because IYM has outperformed the S&P500 in the last few months.
2. Corporate Debt Spread Contract as TALF, TARP, toxic debt triage plan etc. starts to help credit markets. The tells here are LQD which is trading at $93.10, CFT at $90.64, JNK at $29.30 , and HYG at $69.30. All of these ETFs have been recovering nicely from their lows and are a few points higher.
3. Emerging Markets Outperform. The tell here is EEM which has gone from 19 to 26 since March 2nd.
4. VIX goes below 40 and stays there. This one is pretty close because the VIX is at 42.93.
5. Rising Put/Call Ratios. This is the wall of worry the market needs to climb to go higher.
6. Export Data from Japan and Asia get better. Japanese Imports and Exports are dropping like a rock but they are now carrying an unexpected trade surplus of Y82.4 billion. Chinese exports are in the dumper as well, going down 25.7% from a year earlier. These numbers seem to be near rock bottom so hopefully they won't get much worse. March will tell the tale.
7. Job losses begin to slow down or even stop. I think this will probably be one of those things where economists call for a big drop and instead there is little to no drop and everyone is surprised. Then Obama will say that the stimulus is working.
8. Commodities prices start to stabilize with oil at $55-$60. Two tells here (that are fairly liquid) are GSG and DJP. Both of these are commodities Index ETFs.
9. "Disappointing" pre-announced earnings that don't tank the stocks. Look for signs of stabilization in earnings as companies forecast the rest of the year.
10. Shrill bears calling it a "sucker's rally" etc. This is a contrarian indicator that tells you that the louder and more dogmatically they complain the higher the wall of worry becomes. Then if you see them switch sides you know the rally is underway.
Did Cuomo Commit Extortion to Get Back AIG Bonuses?
I think someone could think that according to this memo from the Wall Street Journal. The memo has this important bit in it.
To the extent that we meet certain participation targets, it is not expected that the names will be released, at all.
It kind of seems like Cuomo could have committed extortion.
Most states define extortion as the gaining of property or money by almost any kind of force, or threat of 1) violence, 2) property damage, 3) harm to reputation, or 4) unfavorable government action.
It seem that the harm to reputation part is what he committed. He pretty much put out the threat of releasing these peoples names and having their reputations ruined. I'm sure Cuomo knew that releasing these people's names was like throwing red meat to piranhas. I mean ACORN went to one of these peoples homes and created a publicity stunt in order to shame an AIG employee. What would stop some nutjob from planting a bomb at this guys house?
I figure that Cuomo was forcing these people to pay back the money to AIG and not him personally so he probably won't be charged with anything. However he might have set himself up for a lawsuit. I mean Cuomo pretty much threatened to ruin these people's reputations (or possibly get themselves strangled with piano wire) in return for his silence.
However, these AIG people probably won't sue in order to keep their names out of the paper. It is sad times when the AG of New York threatens workers at a company that I (and every American) owns 80% of.
To the extent that we meet certain participation targets, it is not expected that the names will be released, at all.
It kind of seems like Cuomo could have committed extortion.
Most states define extortion as the gaining of property or money by almost any kind of force, or threat of 1) violence, 2) property damage, 3) harm to reputation, or 4) unfavorable government action.
It seem that the harm to reputation part is what he committed. He pretty much put out the threat of releasing these peoples names and having their reputations ruined. I'm sure Cuomo knew that releasing these people's names was like throwing red meat to piranhas. I mean ACORN went to one of these peoples homes and created a publicity stunt in order to shame an AIG employee. What would stop some nutjob from planting a bomb at this guys house?
I figure that Cuomo was forcing these people to pay back the money to AIG and not him personally so he probably won't be charged with anything. However he might have set himself up for a lawsuit. I mean Cuomo pretty much threatened to ruin these people's reputations (or possibly get themselves strangled with piano wire) in return for his silence.
However, these AIG people probably won't sue in order to keep their names out of the paper. It is sad times when the AG of New York threatens workers at a company that I (and every American) owns 80% of.
Congress Goes on Lavish Trips While Hotel Industry Burns
It seems Congress is practicing some "do as I say not as I do" shenanigans.
About a dozen Democrats, including Dodd, 64, gathered at the Marriott-operated Ritz-Carlton resort in Naples, Florida. Donors who gave at least $15,000 were invited and offered a “coastal view” room at the group rate of $469, according to the Democrats’ invitation.
At least 11 Republican senators held a similar retreat at The Breakers resort in Palm Beach. Rooms could be had for $475 a night. For another $292, participants could play in a golf tournament. The invitation urged guests to make reservations for the resort’s spa “indulgences.”
Yup they are partying it up at the Ritz and the Breakers while some companies are changing travel plans for appearances sake even if it costs them more.
“We’ve seen companies cancel meetings last minute, leaving 100 percent on the table just to avoid criticism and ridicule,” said Frits van Paasschen, president and chief executive of White Plains, New York-based Starwood Hotels & Resorts Worldwide Inc., the third-largest U.S. lodging company, who attended the White House meeting.
“We’ve also seen meeting planners move meetings from resort locations to city locations, at a greater cost to their companies, again, for optics’ sake,” he said.
It all seems to stem from Obama putting his foot in his mouth "Special Olympics" style.
Hotel executives said their business began to suffer after Obama, 47, warned Feb. 9 during a town-hall meeting in Elkhart, Indiana, that companies receiving bailout money “can’t go take a trip to Las Vegas or go down to the Super Bowl on the taxpayers’ dime.”
Of course if Obama wasn't looking for a camera to jump in front of he would know that the taxpayers dime is sitting on the books of many banks in order to fill capital requirements. Travel budgets usually come from another pot of money and are worked out far in advance. In any case we get to see the travel industry (and places like Vegas) torn up for the sake of appearances.
About a dozen Democrats, including Dodd, 64, gathered at the Marriott-operated Ritz-Carlton resort in Naples, Florida. Donors who gave at least $15,000 were invited and offered a “coastal view” room at the group rate of $469, according to the Democrats’ invitation.
At least 11 Republican senators held a similar retreat at The Breakers resort in Palm Beach. Rooms could be had for $475 a night. For another $292, participants could play in a golf tournament. The invitation urged guests to make reservations for the resort’s spa “indulgences.”
Yup they are partying it up at the Ritz and the Breakers while some companies are changing travel plans for appearances sake even if it costs them more.
“We’ve seen companies cancel meetings last minute, leaving 100 percent on the table just to avoid criticism and ridicule,” said Frits van Paasschen, president and chief executive of White Plains, New York-based Starwood Hotels & Resorts Worldwide Inc., the third-largest U.S. lodging company, who attended the White House meeting.
“We’ve also seen meeting planners move meetings from resort locations to city locations, at a greater cost to their companies, again, for optics’ sake,” he said.
It all seems to stem from Obama putting his foot in his mouth "Special Olympics" style.
Hotel executives said their business began to suffer after Obama, 47, warned Feb. 9 during a town-hall meeting in Elkhart, Indiana, that companies receiving bailout money “can’t go take a trip to Las Vegas or go down to the Super Bowl on the taxpayers’ dime.”
Of course if Obama wasn't looking for a camera to jump in front of he would know that the taxpayers dime is sitting on the books of many banks in order to fill capital requirements. Travel budgets usually come from another pot of money and are worked out far in advance. In any case we get to see the travel industry (and places like Vegas) torn up for the sake of appearances.
Treasury Seeks Vast New Powers
The question is will they use the AIG crisis in order to give them that power?
Geithner made it clear he believes the treasury secretary should be granted unprecedented power, after consultation with Federal Reserve Board officials, to take control of a major financial institution and run it. The treasury chief is an official of the administration, unlike the FDIC, which is an independent regulatory agency.
In other words the Treasury would run AIG instead of trying to find some altruistic person like Ed Liddy the current CEO. It seems plausible but what criteria would the Treasury need in order to take over the company? If the bank broke a stress test for one quarter, lets say, would the Treasury immediately nationalize the company? In this case there will be a fear of rolling nationalizations every time there is a recession. Also there needs to be some sort of check from another branch of government or there could be abuses.
Geithner made it clear he believes the treasury secretary should be granted unprecedented power, after consultation with Federal Reserve Board officials, to take control of a major financial institution and run it. The treasury chief is an official of the administration, unlike the FDIC, which is an independent regulatory agency.
In other words the Treasury would run AIG instead of trying to find some altruistic person like Ed Liddy the current CEO. It seems plausible but what criteria would the Treasury need in order to take over the company? If the bank broke a stress test for one quarter, lets say, would the Treasury immediately nationalize the company? In this case there will be a fear of rolling nationalizations every time there is a recession. Also there needs to be some sort of check from another branch of government or there could be abuses.
Health Insurers Consider Dropping Risk Rating
So if you buy individual insurance you might be able to still get insurance even if you have an existing medical condition.
In the letter, the two insurance industry groups said their members are willing to "phase out the practice of varying premiums based on health status in the individual market" if all Americans are required to get coverage.
"The offer here is to transition away from risk rating, which is one of the things that makes life hell for real people," said health economist Len Nichols of the New America Foundation public policy center. "They have never in their history offered to give up risk rating."
In other words they don't want the government to price them out of business so they are forced to offer a better product. That seems like an okay plan as long as there isn't some sort of health epidemic in the US. I wonder if they will let healthy people pay less or will they end up paying more?
In the letter, the two insurance industry groups said their members are willing to "phase out the practice of varying premiums based on health status in the individual market" if all Americans are required to get coverage.
"The offer here is to transition away from risk rating, which is one of the things that makes life hell for real people," said health economist Len Nichols of the New America Foundation public policy center. "They have never in their history offered to give up risk rating."
In other words they don't want the government to price them out of business so they are forced to offer a better product. That seems like an okay plan as long as there isn't some sort of health epidemic in the US. I wonder if they will let healthy people pay less or will they end up paying more?
Monday, March 23, 2009
More Help Drop Shipped to Treasury
At last it won't be Geithner and a bunch of secretaries trying to fix a global financial mess. Neal Wolin is a top exec at Hartford Financial Group. So we have a guy that has a job in the business world. While Lael Brainard is a top egg-head at the Brookings Institution (that sure is an ugly picture of her, I think Brookings needs to spring for a better digital camera.) She seems to be a Ben Bernanke-type academic. I'm hoping both of these people have paid their taxes in full and are ready to hit the ground running.
Mr. Obama on Monday announced Neal Wolin as deputy treasury secretary. The White House also announced that Lael Brainard would be the department's top official for international affairs and that Stuart Levey would stay on as the top counter terrorism official.
Their appointments round out four of the five top jobs at treasury, if the Senate confirms them.
Mr. Obama on Monday announced Neal Wolin as deputy treasury secretary. The White House also announced that Lael Brainard would be the department's top official for international affairs and that Stuart Levey would stay on as the top counter terrorism official.
Their appointments round out four of the five top jobs at treasury, if the Senate confirms them.
Obama Goes on a Wall Street Charm Offensive: Will Wall Street Turn the Cold Shoulder?
Now when the Treasury needs their money to restart credit markets and help bank balance sheets he dials back the rhetoric.
But weeks of searing criticism by politicians and the public had left bankers leery of working with the government. After brainstorming about what to do about that problem, the White House resolved to try to take control of the debate, according to several administration officials. In weekend television appearances, President Barack Obama and other administration officials tempered their criticisms of the financial sector.
Too bad bankers seem to be nonplussed now that Obama needs them again.
Some bankers say they turned the conversations into complaints about the antibonus crusade consuming Capitol Hill. Some have begun "slow-walking" the information previously sought by Treasury for stress-testing financial institutions, three bankers say, and considered seeking capital from hedge funds and private-equity funds so they could return federal bailout money, thereby escaping federal restrictions.
In other words some banks would rather borrow money from other funds in order to get rid of the TARP money on their books. Talk about counter-productive. Maybe Obama is finally understanding what is good for Wall Street sometimes benefits Main Street. It is all well-and-good to be anti-corporate if Uncle Sam is paying your salary. However, when you want companies to create jobs you need to help those companies out. I have to give Obama credit he does have the capacity to change his mind when situations change.
But weeks of searing criticism by politicians and the public had left bankers leery of working with the government. After brainstorming about what to do about that problem, the White House resolved to try to take control of the debate, according to several administration officials. In weekend television appearances, President Barack Obama and other administration officials tempered their criticisms of the financial sector.
Too bad bankers seem to be nonplussed now that Obama needs them again.
Some bankers say they turned the conversations into complaints about the antibonus crusade consuming Capitol Hill. Some have begun "slow-walking" the information previously sought by Treasury for stress-testing financial institutions, three bankers say, and considered seeking capital from hedge funds and private-equity funds so they could return federal bailout money, thereby escaping federal restrictions.
In other words some banks would rather borrow money from other funds in order to get rid of the TARP money on their books. Talk about counter-productive. Maybe Obama is finally understanding what is good for Wall Street sometimes benefits Main Street. It is all well-and-good to be anti-corporate if Uncle Sam is paying your salary. However, when you want companies to create jobs you need to help those companies out. I have to give Obama credit he does have the capacity to change his mind when situations change.
JPMorgan To Buy Gulfstream 650 Jets and Renovate Hangar: Wait for the Outrage Mob
They need to pay back that stupid TARP money quick before the "Outrage Mob" jumps all over them.
Joseph Evangelisti, a spokesman for JPMorgan Chase, said no TARP money would be used to make any payments for new jets or jet hangar improvements. He refused to comment on whether JPMorgan had put a down payment for new planes, saying only that any future jet purchases would be part of its normal aircraft replacement policy, and that JPMorgan Chase will repay all TARP money before it makes any payments for new planes or renovations.
That TARP money is poison and I think JPMorgan should get rid of it before Congress taxes them 90% or something. These planes are replacing aging planes that the company bought years ago. The Outrage Mob may not like corporate fat cats flying around in private planes like they thought they were the Speaker of the House Pelosi or something.
However it really shouldn't matter to anyone how JP Morgan spends their money just like it shouldn't matter how a private citizen spends their hard earned money. JPM finds they save on travel (or there are security and thus key-man insurance concerns) if they buy and maintain their own corporate jets. If this company is solvent and isn't a danger to the world economy (like AIG) then they should be allowed to buy whatever they deem important for their business.
Joseph Evangelisti, a spokesman for JPMorgan Chase, said no TARP money would be used to make any payments for new jets or jet hangar improvements. He refused to comment on whether JPMorgan had put a down payment for new planes, saying only that any future jet purchases would be part of its normal aircraft replacement policy, and that JPMorgan Chase will repay all TARP money before it makes any payments for new planes or renovations.
That TARP money is poison and I think JPMorgan should get rid of it before Congress taxes them 90% or something. These planes are replacing aging planes that the company bought years ago. The Outrage Mob may not like corporate fat cats flying around in private planes like they thought they were the Speaker of the House Pelosi or something.
However it really shouldn't matter to anyone how JP Morgan spends their money just like it shouldn't matter how a private citizen spends their hard earned money. JPM finds they save on travel (or there are security and thus key-man insurance concerns) if they buy and maintain their own corporate jets. If this company is solvent and isn't a danger to the world economy (like AIG) then they should be allowed to buy whatever they deem important for their business.
Toxic Asset Plan Revealed. So Far the Market Likes It!
Here is a link to a PDF of the toxic asset plan. So far the markets verdict is "thumbs up."
The market shot higher at the opening and kept going. The Treasury Department said its bad asset cleanup program would tap money from the government's $700 billion financial rescue fund and involve help from the Federal Reserve, the Federal Deposit Insurance Corp. and the participation of private investors.
The government's announcement was what the market had waited weeks to hear. Treasury Secretary Timothy Geithner had announced an outline of the program last month but provided few details then about how it would work, leading to a stock plunge that sliced 380 points from the Dow.
The market shot higher at the opening and kept going. The Treasury Department said its bad asset cleanup program would tap money from the government's $700 billion financial rescue fund and involve help from the Federal Reserve, the Federal Deposit Insurance Corp. and the participation of private investors.
The government's announcement was what the market had waited weeks to hear. Treasury Secretary Timothy Geithner had announced an outline of the program last month but provided few details then about how it would work, leading to a stock plunge that sliced 380 points from the Dow.
Hulu Is Growing like a Weed
I have watched it a few times and I am patiently waiting for Big Bang to come on the service so I don't have to watch it on Mondays. I mean CBS should get with the program and just put that stuff on there already. I have to say that these are pretty impressive growth numbers.
Hulu is really becoming a major force in online video. Since comScore started measuring last May, Hulu has grown the number of videos it streams by 277 percent, and its audience has grown 410 percent. Nielsen VideoCensus data shows similar growth in streams (see second table below).
Hulu is really becoming a major force in online video. Since comScore started measuring last May, Hulu has grown the number of videos it streams by 277 percent, and its audience has grown 410 percent. Nielsen VideoCensus data shows similar growth in streams (see second table below).
Friday, March 20, 2009
Who is Working at AIG? It Seems to Be the Clean-up Crew
At least you get a sense that the people getting the bonuses aren't a bunch of greedy derivative traders but people trying the clean up the mess before it *really* blows up.
In actuality, he said, nearly all the troublesome sectors of the business -- namely, the risky credit derivatives written on mortgage-backed securities -- are now out of the equation, as are the people who worked on them. That leaves a small number of employees to untangle the remaining trades in four main areas: commodities, interest rates, currency and equities -- most of which were fully hedged and have caused little problem. The effort also requires a sizable number of "back office" staff, such as systems, computing, accounting, human resources and legal teams.
"Everybody, including my secretary and including the guy down the hall that serves lunch, gets a payment," said Pasciucco, who added that he received no retention payment and has no contract.
Also it seems if Congress does pass its "stick it to AIG" tax we might have the law of unintended consequences to deal with. These guys may walk and harm the firm.
But it would be impractical at best, dangerous at worst, to get rid of everyone at Financial Products, according to AIG officials. If everyone leaves, Pasciucco said, "you don't have people that really, truly understand the book [of business]. We're still big enough that that matters."
If they did walk out the door, who would volunteer to work at the Chernobyl of the financial world? And what would become of the mammoth portfolio that remains?
"It would become the biggest naked position on Wall Street," one longtime Financial Products executive said, "and everybody would exploit it."
Yup these guys that Congress wants to tax so badly will simply walk out and join Goldman or whomever and exploit the knowledge of the company that sold them down the river. It's sad to think that a little populist lynch mob has the potential to bring down the entire world economy.
In actuality, he said, nearly all the troublesome sectors of the business -- namely, the risky credit derivatives written on mortgage-backed securities -- are now out of the equation, as are the people who worked on them. That leaves a small number of employees to untangle the remaining trades in four main areas: commodities, interest rates, currency and equities -- most of which were fully hedged and have caused little problem. The effort also requires a sizable number of "back office" staff, such as systems, computing, accounting, human resources and legal teams.
"Everybody, including my secretary and including the guy down the hall that serves lunch, gets a payment," said Pasciucco, who added that he received no retention payment and has no contract.
Also it seems if Congress does pass its "stick it to AIG" tax we might have the law of unintended consequences to deal with. These guys may walk and harm the firm.
But it would be impractical at best, dangerous at worst, to get rid of everyone at Financial Products, according to AIG officials. If everyone leaves, Pasciucco said, "you don't have people that really, truly understand the book [of business]. We're still big enough that that matters."
If they did walk out the door, who would volunteer to work at the Chernobyl of the financial world? And what would become of the mammoth portfolio that remains?
"It would become the biggest naked position on Wall Street," one longtime Financial Products executive said, "and everybody would exploit it."
Yup these guys that Congress wants to tax so badly will simply walk out and join Goldman or whomever and exploit the knowledge of the company that sold them down the river. It's sad to think that a little populist lynch mob has the potential to bring down the entire world economy.
Support For Nuclear Energy Highest Since 1995
It seems that more Americans are understanding that nuclear energy is the only viable bridge technology that gets us off of oil and takes us into true renewables.
President Obama has said that nuclear power is part of his overall plan to expand the use of alternative energy in the United States, and if public support for it continues to grow, it would seem likely that more Americans would come to rely on nuclear energy.
If Obama gets us to even half of what France or Japan has in total nuclear power then I will consider his energy contribution a big success. If he could get us to 0% Mullah Brand Oil penetration in our energy markets then I would put him in the top 1/3 of Presidents.
President Obama has said that nuclear power is part of his overall plan to expand the use of alternative energy in the United States, and if public support for it continues to grow, it would seem likely that more Americans would come to rely on nuclear energy.
If Obama gets us to even half of what France or Japan has in total nuclear power then I will consider his energy contribution a big success. If he could get us to 0% Mullah Brand Oil penetration in our energy markets then I would put him in the top 1/3 of Presidents.
Video Game Sales Buck the Recession Trend Yet Again
It seems that people still want to stay home and play their Wii's instead of going out and spending more cashola.
Americans bought 753,000 units of Nintendo's Wii, the best-selling console. The handheld Nintendo DS, which sold 588,000 units, came in second.
Microsoft's Xbox 360 sold 391,000 units, up 53 percent from a year earlier, while Sony's PlayStation 3 sold 276,000 units.
Americans bought 753,000 units of Nintendo's Wii, the best-selling console. The handheld Nintendo DS, which sold 588,000 units, came in second.
Microsoft's Xbox 360 sold 391,000 units, up 53 percent from a year earlier, while Sony's PlayStation 3 sold 276,000 units.
Thursday, March 19, 2009
Obama Insults the Disabled on the Tonight Show?: Say It Ain't So!
I think Obama needs to think about getting a full 8 hours of sleep before going on national television. This is a Bush level verbal gaff.
Towards the end of his approximately 40-minute appearance, the president talked about how he's gotten better at bowling and has been practicing in the White House bowling alley.
He bowled a 129, the president said.
"That's very good, Mr. President," Leno said sarcastically.
It's "like the Special Olympics or something," the president said.
When asked about the remark, the White House said the president did not intend to offend.
I can picture Jay Leno saying "comedy is hard isn't it?" after that line meets with some steely silence.
Towards the end of his approximately 40-minute appearance, the president talked about how he's gotten better at bowling and has been practicing in the White House bowling alley.
He bowled a 129, the president said.
"That's very good, Mr. President," Leno said sarcastically.
It's "like the Special Olympics or something," the president said.
When asked about the remark, the White House said the president did not intend to offend.
I can picture Jay Leno saying "comedy is hard isn't it?" after that line meets with some steely silence.
White House Gets a Garden! Fresh Foods for All
Now this is a great idea that has been many years in the making.
First lady Michelle Obama is scheduled to break ground Friday on a new garden near the fountain on the South Lawn that will supply the White House kitchen.
She will be joined by students from Bancroft Elementary School in the District of Columbia. The children will stay involved with the project, including planting the fruits, vegetables and herbs in the coming weeks and harvesting the crops later in the year.
I hope more Americans can follow this example and plant their own backyard gardens. Hell, instead of that worthless landscaping you see everywhere they should make them into garden plots that you can sign up for. What you would do is to pay the municipality a yearly fee and then you can grow whatever you want on your plot. They could even cordon off certain parks in big cities and divvy them out for gardens plots as well. Let's hope the White House lets a thousand gardens bloom.
First lady Michelle Obama is scheduled to break ground Friday on a new garden near the fountain on the South Lawn that will supply the White House kitchen.
She will be joined by students from Bancroft Elementary School in the District of Columbia. The children will stay involved with the project, including planting the fruits, vegetables and herbs in the coming weeks and harvesting the crops later in the year.
I hope more Americans can follow this example and plant their own backyard gardens. Hell, instead of that worthless landscaping you see everywhere they should make them into garden plots that you can sign up for. What you would do is to pay the municipality a yearly fee and then you can grow whatever you want on your plot. They could even cordon off certain parks in big cities and divvy them out for gardens plots as well. Let's hope the White House lets a thousand gardens bloom.
Obama Envoy Holbooke was on the AIG Board in 2008?
It seems that this guy was on the Board of Directors at the exact time when these AIG traders were filling up at the risk buffet and plowing this company into the ground?
Holbrooke, a veteran diplomat who is now the administration's point man on Pakistan and Afghanistan, served on the board between 2001 and mid-2008.
During that period, AIG undertook the aggressive investment strategies that led to a near-collapse and forced a multibillion-dollar federal bailout.
However, it seems that AIG approved these bonuses in the first quarter of 2008.
This information included that $165 million in payments were expected that very month, as well as the fact that the contracts were in place in the first quarter of 2008, and so not covered by the limitations in the stimulus bill as articulated by an amendment to the stimulus bill offered by Sen. Chris Dodd, D-Conn.
So technically Holbrooke was on the AIG board when these things were approved. Lucky thing is that he wasn't on the compensation committee at that time or he would need to do some serious explaining. He seemed to be on the social responsibility committee at that time so he would be more involved with charitable giving and that sort of thing.
The problem is that board members have access to almost all of the information at a large corporation. I guess he was just too busy to get a handle on compensation at AIG. He also was pretty lucky to have gotten off of the AIG train a couple quarters before it wrecked as well. I wonder how underwater his stock options that he got while a board member are?
Holbrooke, a veteran diplomat who is now the administration's point man on Pakistan and Afghanistan, served on the board between 2001 and mid-2008.
During that period, AIG undertook the aggressive investment strategies that led to a near-collapse and forced a multibillion-dollar federal bailout.
However, it seems that AIG approved these bonuses in the first quarter of 2008.
This information included that $165 million in payments were expected that very month, as well as the fact that the contracts were in place in the first quarter of 2008, and so not covered by the limitations in the stimulus bill as articulated by an amendment to the stimulus bill offered by Sen. Chris Dodd, D-Conn.
So technically Holbrooke was on the AIG board when these things were approved. Lucky thing is that he wasn't on the compensation committee at that time or he would need to do some serious explaining. He seemed to be on the social responsibility committee at that time so he would be more involved with charitable giving and that sort of thing.
The problem is that board members have access to almost all of the information at a large corporation. I guess he was just too busy to get a handle on compensation at AIG. He also was pretty lucky to have gotten off of the AIG train a couple quarters before it wrecked as well. I wonder how underwater his stock options that he got while a board member are?
90% "AIG Bonus" Tax Issued by Congress
Well Congress is going to get that money no matter what and they rushed through some legislation that will do it post-haste.
Denouncing a "squandering of the people's money," lawmakers voted decisively Thursday to impose a 90 percent tax on millions of dollars in employee bonuses paid by troubled insurance giant AIG and other bailed-out companies. The House vote was 328-93. Similar legislation has been introduced in the Senate and President Barack Obama quickly signaled general support for the concept.
In other words give back that TARP money right now or Congress will tax your employees so badly that they will want to leave. Or maybe even get them killed or harassed if Barney Frank had his way.
Denouncing a "squandering of the people's money," lawmakers voted decisively Thursday to impose a 90 percent tax on millions of dollars in employee bonuses paid by troubled insurance giant AIG and other bailed-out companies. The House vote was 328-93. Similar legislation has been introduced in the Senate and President Barack Obama quickly signaled general support for the concept.
In other words give back that TARP money right now or Congress will tax your employees so badly that they will want to leave. Or maybe even get them killed or harassed if Barney Frank had his way.
Duke Coach Krzyzewski to Obama: Focus on Economy not Bracketology
I have to agree with what the legendary Duke coach has to say.
"Somebody said that we're not in President Obama's Final Four, and as much as I respect what he's doing, really, the economy is something that he should focus on, probably more than the brackets," Duke coach Mike Krzyzewski said from the Blue Devils' first-round site in Greensboro, N.C.
Forget the Final Four, health care reform, education reform, etc. and focus on the economy. The banks need to come before bank shots. Less bracket sheets and more balance sheets. Less focus on the potential Cinderella story of American University and more focus on the tragedy that is American GDP. In other words do your bracket sheet for next years NCAA tourney when our economy is hopefully growing again.
"Somebody said that we're not in President Obama's Final Four, and as much as I respect what he's doing, really, the economy is something that he should focus on, probably more than the brackets," Duke coach Mike Krzyzewski said from the Blue Devils' first-round site in Greensboro, N.C.
Forget the Final Four, health care reform, education reform, etc. and focus on the economy. The banks need to come before bank shots. Less bracket sheets and more balance sheets. Less focus on the potential Cinderella story of American University and more focus on the tragedy that is American GDP. In other words do your bracket sheet for next years NCAA tourney when our economy is hopefully growing again.
Wednesday, March 18, 2009
North Koreans Perfect Pizza After 10 Years of Central Planning
Ah the North Koreans will finally be enjoying "authentic" Italian pizza and it only took them a solid decade of work.
It has taken almost 10 years of work, but North Korea has acquired the technology to launch a project very dear to its leader's heart - the nation's first "authentic" Italian pizzeria.
The launch of Pyongyang's first Italian restaurant meanwhile brings to fruition a ten-year effort by Kim Jong-il - a renowned gourmand and lover of western food - to create the perfect pizza and pasta in his homeland.
Last year a delegation of local chefs was sent by Kim to Naples and Rome to learn the proper Italian techniques after their homegrown efforts to mimic Italian cuisine were found by Kim to contain "errors".
Of course if North Korea was a capitalist society they would have had "authentic" Italian pizza 9 years, 11 months and 29 days ago by offering an economic incentive to lure pizza chefs from Italy. Maybe North Korea could have offered start-up capital or lifted visa restrictions and those chefs would have come on down. Hopefully the Red Chinese can show them how it is done.
It has taken almost 10 years of work, but North Korea has acquired the technology to launch a project very dear to its leader's heart - the nation's first "authentic" Italian pizzeria.
The launch of Pyongyang's first Italian restaurant meanwhile brings to fruition a ten-year effort by Kim Jong-il - a renowned gourmand and lover of western food - to create the perfect pizza and pasta in his homeland.
Last year a delegation of local chefs was sent by Kim to Naples and Rome to learn the proper Italian techniques after their homegrown efforts to mimic Italian cuisine were found by Kim to contain "errors".
Of course if North Korea was a capitalist society they would have had "authentic" Italian pizza 9 years, 11 months and 29 days ago by offering an economic incentive to lure pizza chefs from Italy. Maybe North Korea could have offered start-up capital or lifted visa restrictions and those chefs would have come on down. Hopefully the Red Chinese can show them how it is done.
Dodd Admits He Put AIG Loophole into Stimulus Bill
I swear this guy does not know if he is coming or going sometimes.
Dodd just admitted on CNN that he inserted a loophole in the stimulus legislation that allowed million-dollar bonuses to insurance giant AIG to go forward – after previously denying any involvement in writing the controversial provision.
That is why you read a bill before you vote on it to make sure what you put into the thing is what you intended.
Dodd just admitted on CNN that he inserted a loophole in the stimulus legislation that allowed million-dollar bonuses to insurance giant AIG to go forward – after previously denying any involvement in writing the controversial provision.
That is why you read a bill before you vote on it to make sure what you put into the thing is what you intended.
At Last Cooler Heads Prevail. AIG will pay back the bonuses from further TARP money
I'm glad someone is an adult in Washington.
Acknowledging "considerable outrage" about the bonus payments, Geithner said AIG will pay the Treasury an amount equal to the payments, and the Treasury will deduct that amount from the $30 billion in government assistance that will soon go to the company.
Rather then taxing these people 100% or breaking a legal and binding contract as specified in the Constitution AIG will just pay back the money. They simply deduct it from the $30 billion and then agree to not pay out any other bonuses until the loan money is paid back. No muss no fuss and no one has to get killed at AIG.
Acknowledging "considerable outrage" about the bonus payments, Geithner said AIG will pay the Treasury an amount equal to the payments, and the Treasury will deduct that amount from the $30 billion in government assistance that will soon go to the company.
Rather then taxing these people 100% or breaking a legal and binding contract as specified in the Constitution AIG will just pay back the money. They simply deduct it from the $30 billion and then agree to not pay out any other bonuses until the loan money is paid back. No muss no fuss and no one has to get killed at AIG.
Now Frank Wants to Get AIG Employees Killed
I think these Congressmen don't understand that these are workers at a public company that have committed no crime. They simply accepted money that was contractually obligated to them. Now they want AIG CEO Liddy to name names like they were communists in 50s?
Rep. Barney Frank, D-Mass., chairman of the Financial Services Committee, demanded that the company submit to Congress a list "of people who received the bonuses, whether they paid them back or not." If the names were not provided "without restriction," Frank warned, he would ask the committee to vote to subpoena them.
Liddy said he would "comply with the law:" but was "concerned about the safety of our people."
He said he would give the names of the bonus recipients only on the basis of confidentiality. He read aloud threats that AIG employees had received, including one that suggested that all bonus recipients should be "executed with piano wire around their necks."
Another one read: "If the government can't do this properly, we the people will take it in our own hands and see that justice is done. I'm looking for all the CEOs' names, kids, where they live, etc."
Frank said he would consult with security officials, but that his request for the names would stand.
Knowing how Washington leaks like a sieve these names will be on the Internet in like 24 hours tops. Then Frank will be responsible for anything bad that would happen to these employees. I can picture Barney "McCarthy" Frank saying "Are you now, or have you ever been, a trader at AIG?"
What would be the reason why Congress needs these names so badly? Do they want to publicly shame them into giving back the money? That would endanger their lives. Do they want the IRS audit them or put them on some sort of watch list? They aren't blowing up buildings they are private citizens working at an insurance firm. This populist forest fire needs to die down in a hurry or someone will get killed over some bonus that their firm was forced to pay them.
Rep. Barney Frank, D-Mass., chairman of the Financial Services Committee, demanded that the company submit to Congress a list "of people who received the bonuses, whether they paid them back or not." If the names were not provided "without restriction," Frank warned, he would ask the committee to vote to subpoena them.
Liddy said he would "comply with the law:" but was "concerned about the safety of our people."
He said he would give the names of the bonus recipients only on the basis of confidentiality. He read aloud threats that AIG employees had received, including one that suggested that all bonus recipients should be "executed with piano wire around their necks."
Another one read: "If the government can't do this properly, we the people will take it in our own hands and see that justice is done. I'm looking for all the CEOs' names, kids, where they live, etc."
Frank said he would consult with security officials, but that his request for the names would stand.
Knowing how Washington leaks like a sieve these names will be on the Internet in like 24 hours tops. Then Frank will be responsible for anything bad that would happen to these employees. I can picture Barney "McCarthy" Frank saying "Are you now, or have you ever been, a trader at AIG?"
What would be the reason why Congress needs these names so badly? Do they want to publicly shame them into giving back the money? That would endanger their lives. Do they want the IRS audit them or put them on some sort of watch list? They aren't blowing up buildings they are private citizens working at an insurance firm. This populist forest fire needs to die down in a hurry or someone will get killed over some bonus that their firm was forced to pay them.
Tuesday, March 17, 2009
AIG Bonus Madness! They Need Armed Guards?
This is just ridiculous! I wonder if these traders at AIG still want to fix this CDO mess now that they have to take this kind of abuse. Hell, I would leave bonus or no bonus if I got death threats or needed armed guards just to get in the front door of my workplace.
A tidal wave of public outrage over bonus payments swamped American International Group yesterday. Hired guards stood watch outside the suburban Connecticut offices of AIG Financial Products, the division whose exotic derivatives brought the insurance giant to the brink of collapse last year. Inside, death threats and angry letters flooded e-mail inboxes. Irate callers lit up the phone lines. Senior managers submitted their resignations. Some employees didn't show up at all.
That is what happens when populist frenzy is whipped up into a raging inferno by Obama and Congress. I think New York AG Cuomo wanting to name names on who got the bonuses will make things even worse. I'm pretty sure morale will go right into the toilet (if it wasn't there already) since some trader (more likely some kid in Marketing) might get killed off by some nutcase for the sole crime of coming to work at AIG. In other words don't take that TARP money or the AG of New York could put your name out there in public and get you killed.
A tidal wave of public outrage over bonus payments swamped American International Group yesterday. Hired guards stood watch outside the suburban Connecticut offices of AIG Financial Products, the division whose exotic derivatives brought the insurance giant to the brink of collapse last year. Inside, death threats and angry letters flooded e-mail inboxes. Irate callers lit up the phone lines. Senior managers submitted their resignations. Some employees didn't show up at all.
That is what happens when populist frenzy is whipped up into a raging inferno by Obama and Congress. I think New York AG Cuomo wanting to name names on who got the bonuses will make things even worse. I'm pretty sure morale will go right into the toilet (if it wasn't there already) since some trader (more likely some kid in Marketing) might get killed off by some nutcase for the sole crime of coming to work at AIG. In other words don't take that TARP money or the AG of New York could put your name out there in public and get you killed.
White House Screws Up Brazilian President Lula da Silva's Name
Brazil is going to be one of our most important trading partners in the next decade and the White House misspells the leaders name?
I think the White House needs to slow down a bit or peel off a couple of people who's job it is to coordinate the interactions with world leaders. They will be there to Google the person and make sure their name is spelled correctly. They will also be in charge of picking up the appropriate gifts for the world leader so we don't look like uncaring doofs. So in this case their job would be to avoid giving President Da Silva 10 lbs of Brazil nuts in a Snoopy can.
Still, the White House made several moves interpreted as snubs by the Brazilian media.
Silva aides said the trip was pushed forward from Tuesday because of the St. Patrick's Day holiday — making Latin America once again look like an afterthought. Then, the White House announcement misspelled his name as "Luis Ignacio" and put "Lula" — a nickname that decades ago became a legal part of the Brazilian leader's name — in quotes.
This is after those 25 Hollywood DVDs given to Gordon Brown in return for priceless pen sets made from a slave hunting ship. Then we have the Reset Button marked "Overcharge" given to the Russians.I think the White House needs to slow down a bit or peel off a couple of people who's job it is to coordinate the interactions with world leaders. They will be there to Google the person and make sure their name is spelled correctly. They will also be in charge of picking up the appropriate gifts for the world leader so we don't look like uncaring doofs. So in this case their job would be to avoid giving President Da Silva 10 lbs of Brazil nuts in a Snoopy can.
Economy Starts to Crawl; No Longer on its Back
Ah these are some good signs that the economy is starting to look a little brighter.
The latest evidence came Tuesday when the government said housing starts and building permits rebounded in February.
This followed last week's figures on retail sales, which showed consumers were starting to buy more than just the basics. Discretionary categories including electronics and furniture showed surprising strength.
I have noticed that restaurants are starting to fill up little by little. I was in Chili's the other day and it was packed by about 6PM or so. In November restaurants like that seemed like ghost towns with only a handful of people sharing appetizers. The only bad thing is that the recovery can still be throttled by one bad move from Washington.
Economists think the policy response from Washington offers the best hope that these tentative signs of life will translate into economic growth before the year is out. Unfortunately, policy missteps pose the biggest risk to recovery.
The latest evidence came Tuesday when the government said housing starts and building permits rebounded in February.
This followed last week's figures on retail sales, which showed consumers were starting to buy more than just the basics. Discretionary categories including electronics and furniture showed surprising strength.
I have noticed that restaurants are starting to fill up little by little. I was in Chili's the other day and it was packed by about 6PM or so. In November restaurants like that seemed like ghost towns with only a handful of people sharing appetizers. The only bad thing is that the recovery can still be throttled by one bad move from Washington.
Economists think the policy response from Washington offers the best hope that these tentative signs of life will translate into economic growth before the year is out. Unfortunately, policy missteps pose the biggest risk to recovery.
Dell Introduces High End Laptop Line: What Recession?
I guess you need to give them points for bringing out a laptop that is sure to sell well in 2005 but I'm not so sure about 2009.
The Adamo, which starts at $1,999, is Dell's first foray into luxury notebook computers. It comes to market two years after founder Michael Dell returned as chief executive in an attempt to revive the struggling Round Rock, Texas, company.
The problem is that people are snapping up Netbooks in such large numbers. If more people start to think about mobile computing as connecting to a browser based lifestyle with everything out in the cloud then I don't see too many Adamo's selling. This may be another case of Dell coming late to the party.
The Adamo, which starts at $1,999, is Dell's first foray into luxury notebook computers. It comes to market two years after founder Michael Dell returned as chief executive in an attempt to revive the struggling Round Rock, Texas, company.
The problem is that people are snapping up Netbooks in such large numbers. If more people start to think about mobile computing as connecting to a browser based lifestyle with everything out in the cloud then I don't see too many Adamo's selling. This may be another case of Dell coming late to the party.
Is It Constitutional to Levy a 100% Tax on 73 People at AIG?
It doesn't seem constitutional to levy a 100% on any small group of people working at a private firm. Especially when that money is contractually obligated to them.
"American families shouldn't be forced to reward these professional financial failures with extravagant bonuses that could buy fancy cars and yachts," Israel said in a statement. "AIG may not like it, but since they had to come to the federal government for help, the federal government now has a say in how they spend taxpayer money."
It just doesn't seem like the kind of thing that could pass the Supreme Court. What would keep the Congress from passing a 100% tax on Exxon or someone in order to run them out of business? What if they wanted to squelch unpopular speech by levying a 100% tax on a radio station or a TV network? This seems like a slippery slope.
"American families shouldn't be forced to reward these professional financial failures with extravagant bonuses that could buy fancy cars and yachts," Israel said in a statement. "AIG may not like it, but since they had to come to the federal government for help, the federal government now has a say in how they spend taxpayer money."
It just doesn't seem like the kind of thing that could pass the Supreme Court. What would keep the Congress from passing a 100% tax on Exxon or someone in order to run them out of business? What if they wanted to squelch unpopular speech by levying a 100% tax on a radio station or a TV network? This seems like a slippery slope.
Finally Some Reason on AIG Bonuses
At last we have someone being reasonable about these bonuses.
That is pretty much what I think in a nutshell. If the Treasury and lawmakers try to clawback this contractually obligated bonus then what is keeping these people working at AIG? I mean some idiot Senators like Charles Grassley want them to commit seppuku over accepting bonus money. No one should told to make a choice of dying or giving back some money.
The strange part is that as a taxpayer I should be burning mad that AIG got bonuses from my tax money. The problem is that I think that retaining the people at AIG who could actually unwind these complex trades is a better use of the money then the 9000 earmarks in the Pork Omnibus or $13 for 95% of Americans. As this article says these guys made the bomb so they might be the only people that could defuse it.
This article also points out that these guys could simply leave the firm and then trade against AIGs book. I'm sure there are a few short side Hedge funds that would love to have former AIG people betting against the CDOs that they helped create. Then they instead of being pushed around by Capital Hill they can actually make tons of money off of their own screw ups instead of trying to fix the problems.
“We cannot attract and retain the best and brightest talent to lead and staff” the company “if employees believe that their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury,” he said.
There’s some truth to what Mr. Liddy is saying. Would you want to work at A.I.G.? Sure, maybe for $3 million. But not if you could go somewhere else for even more — or even much less.That is pretty much what I think in a nutshell. If the Treasury and lawmakers try to clawback this contractually obligated bonus then what is keeping these people working at AIG? I mean some idiot Senators like Charles Grassley want them to commit seppuku over accepting bonus money. No one should told to make a choice of dying or giving back some money.
The strange part is that as a taxpayer I should be burning mad that AIG got bonuses from my tax money. The problem is that I think that retaining the people at AIG who could actually unwind these complex trades is a better use of the money then the 9000 earmarks in the Pork Omnibus or $13 for 95% of Americans. As this article says these guys made the bomb so they might be the only people that could defuse it.
This article also points out that these guys could simply leave the firm and then trade against AIGs book. I'm sure there are a few short side Hedge funds that would love to have former AIG people betting against the CDOs that they helped create. Then they instead of being pushed around by Capital Hill they can actually make tons of money off of their own screw ups instead of trying to fix the problems.
Monday, March 16, 2009
Israeli Scholar Says there were no Essenes
Rachel Elior of Jerusalem's Hebrew University contends that they were just a figment of the imagination of Flavius Josephus.
As Elior explains, the Essenes make no mention of themselves in the 900 scrolls found by a Bedouin shepherd in 1947 in the caves of Qumran, near the Dead Sea. "Sixty years of research have been wasted trying to find the Essenes in the scrolls," Elior tells TIME. "But they didn't exist. This is legend on a legend."
I guess she contends that since the Essenes didn't put their names into the scrolls then that means that they never existed. She says that the Dead Sea Scroll authors were priests banished from the Temple of Jerusalem who were known as the renegade sons of Zadok. (I will now steal that name for my D&D campaign) These guys took their library when they left and the Dead Sea Scrolls was part of that library.
That seems plausible because it seems only Josephus had first-hand knowledge that the Essenes even existed. The rest of the ancient historians probably just cribbed from his writings. I guess that is the bad thing about being a celibate Jewish community living in the desert. People don't even know if you even existed or not 2000 years later.
As Elior explains, the Essenes make no mention of themselves in the 900 scrolls found by a Bedouin shepherd in 1947 in the caves of Qumran, near the Dead Sea. "Sixty years of research have been wasted trying to find the Essenes in the scrolls," Elior tells TIME. "But they didn't exist. This is legend on a legend."
I guess she contends that since the Essenes didn't put their names into the scrolls then that means that they never existed. She says that the Dead Sea Scroll authors were priests banished from the Temple of Jerusalem who were known as the renegade sons of Zadok. (I will now steal that name for my D&D campaign) These guys took their library when they left and the Dead Sea Scrolls was part of that library.
That seems plausible because it seems only Josephus had first-hand knowledge that the Essenes even existed. The rest of the ancient historians probably just cribbed from his writings. I guess that is the bad thing about being a celibate Jewish community living in the desert. People don't even know if you even existed or not 2000 years later.
Obama Tries for a Clawback on AIG Bonuses
I'm not sure if this is even legal but I guess they could change the executive pay contracts or something as board members. There is no way they could go after the bonuses that have already been paid without risking a lawsuit.
"It's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay," Obama said at the outset of an appearance to announce help for small businesses hurt by the deep recession.
"How do they justify this outrage to the taxpayers who are keeping the company afloat," the president said.
I think they warranted the bonuses because if you don't pay them then Credit Suisse or a Hedge Fund or someone would poach them away. I hope Obama understands that these are some of the people that are keeping the company afloat. If they jump ship then who will be left to run the company? I'm pretty sure government officials can't do a better job a derivatives trading then the people that currently have these jobs.
The morale at AIG must be in the crapper because you have the President trying to steal your contractually obligated bonus and Barney Frank calling you incompetent and wanting you fired.
Rep. Barney Frank, chairman of the House Financial Services Committee, earlier Monday charged that the move to pay bonuses amounted to "rewarding incompetence."
"These people may have a right to their bonuses. They don't have a right to their jobs forever," said Frank, a Massachusetts Democrat.
"It's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay," Obama said at the outset of an appearance to announce help for small businesses hurt by the deep recession.
"How do they justify this outrage to the taxpayers who are keeping the company afloat," the president said.
I think they warranted the bonuses because if you don't pay them then Credit Suisse or a Hedge Fund or someone would poach them away. I hope Obama understands that these are some of the people that are keeping the company afloat. If they jump ship then who will be left to run the company? I'm pretty sure government officials can't do a better job a derivatives trading then the people that currently have these jobs.
The morale at AIG must be in the crapper because you have the President trying to steal your contractually obligated bonus and Barney Frank calling you incompetent and wanting you fired.
Rep. Barney Frank, chairman of the House Financial Services Committee, earlier Monday charged that the move to pay bonuses amounted to "rewarding incompetence."
"These people may have a right to their bonuses. They don't have a right to their jobs forever," said Frank, a Massachusetts Democrat.
Friday, March 13, 2009
The Obama Stimulus: Throw Giant Parties!
I guess you could call this the White House plan to stimulate the economy one party at a time. Too bad it doesn't apply to Wells Fargo's sales force and their Vegas trips.
“Barack and Michelle Obama have been throwing taxpayer funded parties nearly every night with their ‘friends’ and supporters, with Michelle Obama even exhorting them not to ‘break’ White House property,” Klayman’s announcement said.
“This party atmosphere sends the wrong message to the American people. As the Obama-Clinton crowd party on, the American people are suffering greatly,” Klayman said.
“Barack and Michelle Obama have been throwing taxpayer funded parties nearly every night with their ‘friends’ and supporters, with Michelle Obama even exhorting them not to ‘break’ White House property,” Klayman’s announcement said.
“This party atmosphere sends the wrong message to the American people. As the Obama-Clinton crowd party on, the American people are suffering greatly,” Klayman said.
New Fear of Cap and Trade Making Oil Companies Run to Switzerland?
The thing isn't on the books yet and the oil companies are already trying to work around it. This is not a good development if the Dems want to put a cap and trade system in place for domestic oil companies because as I suspected they will all jump ship. Also all the talk of "windfall profits taxes" last year is now coming back to haunt them. These oil companies aren't stupid.
Over the past six months companies including offshore drilling contractors Noble Corp and Transocean, energy-focused engineering group Foster Wheeler and oilfield services company Weatherfield International have all announced plans to shift domicile to Switzerland.
"Switzerland has a stable and developed tax regime and a network of tax treaties with most countries where we operate," Transocean Chief Executive Bob Long said in a statement in October, when it announced its move. "As a result, the redomestication will improve our ability to maintain a competitive worldwide effective corporate tax rate."
Over the past six months companies including offshore drilling contractors Noble Corp and Transocean, energy-focused engineering group Foster Wheeler and oilfield services company Weatherfield International have all announced plans to shift domicile to Switzerland.
"Switzerland has a stable and developed tax regime and a network of tax treaties with most countries where we operate," Transocean Chief Executive Bob Long said in a statement in October, when it announced its move. "As a result, the redomestication will improve our ability to maintain a competitive worldwide effective corporate tax rate."
Why is CNBC suddenly to Blame for This Meltdown?
I hate this scapegoating that is going on now with Jon Stewart thinking that it was CNBC's job to somehow use their magic prophesy knucklebones or something to warn people about the financial collapse.
Stewart has charged that people at CNBC knew what was going on behind the scenes on Wall Street but didn't tell the public. He has accused CNBC anchors and pundits of abandoning their journalistic duties and acting like cheerleaders for the market.
How was CNBC supposed to warn people about something that legitimate experts in the field had gotten wrong. I mean trillions of dollars in wealth have been wiped out in the collapse. People that looked like geniuses a year or two ago have been shown to have run Ponzi schemes or simply looked clueless. Hell, Fitch even downgraded Warren Buffett's credit ratings.
Only a handful of people were able to dodge the whole mess or even make money from it. The only one that comes to mind is John Paulson of Paulson and Co. who was able to short the subprime mess and the banks before the wheels came off. Even he lost 16% of his assets under management in the second half of 2008.
The majority of analysts were just plain wrong when it came to the credit markets and most of them still don't understand some the toxic assets that are still on the books of the banks. Just like when the tech bubble burst people like Mary Meeker were pumping Internet stocks right before they tanked.
It is the job of the individual investor to cut through the rhetoric and protect your own ass when it comes to the stock market. You can't just park your money in a 401K and let your investments go on autopilot. Just like you can't just watch Cramer and take his stock picks as gospel and hope to make money. They are just suggestions and you have to do the rest of the work. You must do Due Dilligence because you can only trust your own eyes and ears.
As they play every time they run a mutual fund commercial "investments may have risks and past returns are not indicative of future results." In other words the stock market is risky and it going up 20% doesn't mean it can never go down 40%.
Anyone who thought otherwise was fooling themselves into thinking that there was no risk or it was somehow reduced because they had a "long-term horizon." If you truly have a long-term horizon you should be pumping more money into the stock market. You can now buy some stocks at an 85% or greater discount, and if they aren't nationalized (and that is a big IF,) you might be in for returns you may never see again in your lifetime.
Just don't sell! Like Cramer has said over and over on his show the only reason you need to sell right now is if you need that money in the next 5 years. (I would add to that if Obama or Dodd talks about nationalizing your company and wiping you out then it would also be a good idea to sell as well.)
Don't let the Jon Stewart finger pointing at CNBC make you fear the market. Comedians usually give poor financial advice.
Stewart has charged that people at CNBC knew what was going on behind the scenes on Wall Street but didn't tell the public. He has accused CNBC anchors and pundits of abandoning their journalistic duties and acting like cheerleaders for the market.
How was CNBC supposed to warn people about something that legitimate experts in the field had gotten wrong. I mean trillions of dollars in wealth have been wiped out in the collapse. People that looked like geniuses a year or two ago have been shown to have run Ponzi schemes or simply looked clueless. Hell, Fitch even downgraded Warren Buffett's credit ratings.
Only a handful of people were able to dodge the whole mess or even make money from it. The only one that comes to mind is John Paulson of Paulson and Co. who was able to short the subprime mess and the banks before the wheels came off. Even he lost 16% of his assets under management in the second half of 2008.
The majority of analysts were just plain wrong when it came to the credit markets and most of them still don't understand some the toxic assets that are still on the books of the banks. Just like when the tech bubble burst people like Mary Meeker were pumping Internet stocks right before they tanked.
It is the job of the individual investor to cut through the rhetoric and protect your own ass when it comes to the stock market. You can't just park your money in a 401K and let your investments go on autopilot. Just like you can't just watch Cramer and take his stock picks as gospel and hope to make money. They are just suggestions and you have to do the rest of the work. You must do Due Dilligence because you can only trust your own eyes and ears.
As they play every time they run a mutual fund commercial "investments may have risks and past returns are not indicative of future results." In other words the stock market is risky and it going up 20% doesn't mean it can never go down 40%.
Anyone who thought otherwise was fooling themselves into thinking that there was no risk or it was somehow reduced because they had a "long-term horizon." If you truly have a long-term horizon you should be pumping more money into the stock market. You can now buy some stocks at an 85% or greater discount, and if they aren't nationalized (and that is a big IF,) you might be in for returns you may never see again in your lifetime.
Just don't sell! Like Cramer has said over and over on his show the only reason you need to sell right now is if you need that money in the next 5 years. (I would add to that if Obama or Dodd talks about nationalizing your company and wiping you out then it would also be a good idea to sell as well.)
Don't let the Jon Stewart finger pointing at CNBC make you fear the market. Comedians usually give poor financial advice.
WWW turns 20
No it wasn't invented by Al Gore. Instead it was started by a 29 year old programmer that worked at Cern in Geneva named Tim Berners-Lee. Then 2 guys from the University of Illinois named Marc Andreessen and Eric Bina created the first web browser in 1993 and the rest was history.
So Berners-Lee proposed adding "hypertext" to the Cern network, basically embedding software in documents that would point to other related documents. And thus was born the Web, a global communications network that has shaken up industries, created enormous wealth and transformed the way ordinary people live their lives.
"When two years is a typical length of stay, information is constantly being lost," Berners-Lee wrote in his paper proposing a new system for information management. "The technical details of past projects are sometimes lost forever, or only recovered after a detective investigation in an emergency."
Obama Taking a Drubbing in the Polls: Worst First 50 Evar!
It seems that Obama's economic gaffs may be costing him some of his hard won popularity. In the words of the Comic Book Store Guy from the Simpsons: Worst First 50 Days Evar!
Overall, Rasmussen Reports shows a 56%-43% approval, with a third strongly disapproving of the president's performance. This is a substantial degree of polarization so early in the administration. Mr. Obama has lost virtually all of his Republican support and a good part of his Independent support, and the trend is decidedly negative.
I am certainly heartened by this next number because I think Obama's budget is one of the worst things he has done in his first 50 days. With his dismissive comments about the stock market being a close second.
Rasmussen data shows that people now actually oppose Mr. Obama's budget, 46% to 41%. Three-quarters take this position because it will lead to too much spending. And by 2-to-1, voters reject House Speaker Nancy Pelosi's call for a second stimulus package.
Also the feeling that the home mortgage bailout will actually help irresponsible people (ie the Santellistas) are now in the majority as well. Who knew that many Americans don't want to pay for some other guys mortgage?
While over two-thirds support the plan to help homeowners refinance their mortgage, a 48%-36% plurality said that it will unfairly benefit those who have been irresponsible, echoing Rick Santelli's call to arms on CNBC.
Overall, Rasmussen Reports shows a 56%-43% approval, with a third strongly disapproving of the president's performance. This is a substantial degree of polarization so early in the administration. Mr. Obama has lost virtually all of his Republican support and a good part of his Independent support, and the trend is decidedly negative.
I am certainly heartened by this next number because I think Obama's budget is one of the worst things he has done in his first 50 days. With his dismissive comments about the stock market being a close second.
Rasmussen data shows that people now actually oppose Mr. Obama's budget, 46% to 41%. Three-quarters take this position because it will lead to too much spending. And by 2-to-1, voters reject House Speaker Nancy Pelosi's call for a second stimulus package.
Also the feeling that the home mortgage bailout will actually help irresponsible people (ie the Santellistas) are now in the majority as well. Who knew that many Americans don't want to pay for some other guys mortgage?
While over two-thirds support the plan to help homeowners refinance their mortgage, a 48%-36% plurality said that it will unfairly benefit those who have been irresponsible, echoing Rick Santelli's call to arms on CNBC.
Wells Fargo vs. the NAACP
There seems to be a battle brewing between the NAACP and Wells Fargo.
“The NAACP’s allegations are totally unfounded and reckless. We have never tolerated, and will never tolerate, discrimination in any way, shape or form in any of our business practices, products, or services. We are proud of our lengthy record leading the industry in responsible lending practices and in support of the communities we serve, which makes the very thought of a discrimination claim reprehensible to us. We intend to vigorously defend these unfounded allegations. We are confident we will prevail. Our loan terms and pricing are based on market factors and on individual customer and loan circumstances, such as the credit profile of the borrower, the loan type, the loan-to-value ratio, and the property type. We have been working with the NAACP for the past two years to develop a partnership that would benefit the NAACP, its constituents, and our communities, so we are dismayed that the NAACP has chosen to abandon that constructive dialogue in order to pursue this litigation.”
“The NAACP’s allegations are totally unfounded and reckless. We have never tolerated, and will never tolerate, discrimination in any way, shape or form in any of our business practices, products, or services. We are proud of our lengthy record leading the industry in responsible lending practices and in support of the communities we serve, which makes the very thought of a discrimination claim reprehensible to us. We intend to vigorously defend these unfounded allegations. We are confident we will prevail. Our loan terms and pricing are based on market factors and on individual customer and loan circumstances, such as the credit profile of the borrower, the loan type, the loan-to-value ratio, and the property type. We have been working with the NAACP for the past two years to develop a partnership that would benefit the NAACP, its constituents, and our communities, so we are dismayed that the NAACP has chosen to abandon that constructive dialogue in order to pursue this litigation.”
The Red Chinese Want their Money Safe from the Obama Years
I think Premier Wen doesn't want America to spend their way into the poorhouse and take trillions of dollars of our bonds down the crapper. So Obama needs to be put on alert that he can't spend too freely or the bill *will* come due. Too bad the credit agency is the Red Chinese.
"Of course we are concerned about the safety of our assets. To be honest, I'm a little bit worried," Wen said at a news conference Friday after the closing of China's annual legislative session. "I would like to call on the United States to honor its words, stay a credible nation and ensure the safety of Chinese assets."
"Of course we are concerned about the safety of our assets. To be honest, I'm a little bit worried," Wen said at a news conference Friday after the closing of China's annual legislative session. "I would like to call on the United States to honor its words, stay a credible nation and ensure the safety of Chinese assets."
Thursday, March 12, 2009
The Great Antwerp Diamond Heist!
This is a fascinating article from Wired on how a group of 5 men were able to rob the Antwerp Diamond Center.
In February 2003, Notarbartolo was arrested for heading a ring of Italian thieves. They were accused of breaking into a vault two floors beneath the Antwerp Diamond Center and making off with at least $100 million worth of loose diamonds, gold, jewelry, and other spoils. The vault was thought to be impenetrable. It was protected by 10 layers of security, including infrared heat detectors, Doppler radar, a magnetic field, a seismic sensor, and a lock with 100 million possible combinations. The robbery was called the heist of the century, and even now the police can't explain exactly how it was done.
It is a made for movie story and I found myself casting the fast paced thriller that will hopefully come out of this true story. Most of the people were caught via circumstantial evidence and are serving 5-10 year sentences.
Supposedly they stole only $20 million of a possible $100 million and they found lots of the leather diamond bags empty. So there may have been an insurance scam done by their benefactor who was either a Mafiosi or a Jewish diamond merchant. That person tipped off fellow diamond merchants who hid their diamonds before the heist and then put claims in that they were stolen. Or the heisters could have hid the extra diamonds and will divvy it up after they all get out of prison.
The story even had cool nicknames for the various members of the Heist team.
There was the Genius who was a master of getting past all sorts of bank vault sensors and set up a hidden camera to watch a guard put in the vault combination. I would make this guy a really cocky guy that is smart as a whip. I think Stanley Tucci would fit this role.
One was called the Monster who was an electrician, wheelman, and had vast physical strength. He had to sneak into the vault and get past a combination motion and heat detector and splice a length of cable that blocked the sensor circuit that came out of the vault area so they could work. I would make this guy a tough guy actor like Vinnie Jones.
One was called the King of Keys and he was a master locksmith and lock picker who's job was to make a huge 1 foot key to get past the vault. He also picked the various locks that they had to get through. I would make this person someone like Bill Nighy.
Then there was a nervous associate of Notarbartolo called Speedy who had a panic attack and caused them to be caught when he threw all of the evidence away instead of burning it. I would cast someone like Steve Buscemi.
Then there the master jewel thief, Notarbartolo who is the face-man of the operation. He pretended to be a jovial jewel merchant from Italy and was actually casing the Antwerp Diamond District in order to steal money from various merchants there.
He was the leader of the group and had to go into the vault and take pictures and set up the heist. He was also a family man that seemed like a decent enough guy for a jewel thief. This would have to be the main character of the film but doesn't have to be an action hero type of guy. I would make him someone like Paul Giamatti. I think he can play smart and jovial but with a calculating side.
I hope someone has the rights because this would make one of the all time caper films.
In February 2003, Notarbartolo was arrested for heading a ring of Italian thieves. They were accused of breaking into a vault two floors beneath the Antwerp Diamond Center and making off with at least $100 million worth of loose diamonds, gold, jewelry, and other spoils. The vault was thought to be impenetrable. It was protected by 10 layers of security, including infrared heat detectors, Doppler radar, a magnetic field, a seismic sensor, and a lock with 100 million possible combinations. The robbery was called the heist of the century, and even now the police can't explain exactly how it was done.
It is a made for movie story and I found myself casting the fast paced thriller that will hopefully come out of this true story. Most of the people were caught via circumstantial evidence and are serving 5-10 year sentences.
Supposedly they stole only $20 million of a possible $100 million and they found lots of the leather diamond bags empty. So there may have been an insurance scam done by their benefactor who was either a Mafiosi or a Jewish diamond merchant. That person tipped off fellow diamond merchants who hid their diamonds before the heist and then put claims in that they were stolen. Or the heisters could have hid the extra diamonds and will divvy it up after they all get out of prison.
The story even had cool nicknames for the various members of the Heist team.
There was the Genius who was a master of getting past all sorts of bank vault sensors and set up a hidden camera to watch a guard put in the vault combination. I would make this guy a really cocky guy that is smart as a whip. I think Stanley Tucci would fit this role.
One was called the Monster who was an electrician, wheelman, and had vast physical strength. He had to sneak into the vault and get past a combination motion and heat detector and splice a length of cable that blocked the sensor circuit that came out of the vault area so they could work. I would make this guy a tough guy actor like Vinnie Jones.
One was called the King of Keys and he was a master locksmith and lock picker who's job was to make a huge 1 foot key to get past the vault. He also picked the various locks that they had to get through. I would make this person someone like Bill Nighy.
Then there was a nervous associate of Notarbartolo called Speedy who had a panic attack and caused them to be caught when he threw all of the evidence away instead of burning it. I would cast someone like Steve Buscemi.
Then there the master jewel thief, Notarbartolo who is the face-man of the operation. He pretended to be a jovial jewel merchant from Italy and was actually casing the Antwerp Diamond District in order to steal money from various merchants there.
He was the leader of the group and had to go into the vault and take pictures and set up the heist. He was also a family man that seemed like a decent enough guy for a jewel thief. This would have to be the main character of the film but doesn't have to be an action hero type of guy. I would make him someone like Paul Giamatti. I think he can play smart and jovial but with a calculating side.
I hope someone has the rights because this would make one of the all time caper films.
Iraqi Shoe Thrower Sentenced to 3 Years in Prison
I think that is about right when it comes to assaulting a foreign leader.
A court convicted an Iraqi journalist of assault Thursday for hurling his shoes at George W. Bush and sentenced him to three years in prison, prompting an outburst from his family and calls for his release from Iraqis who consider him an icon for a nation decimated by war.
Imagine if he threw the shoes near Saddam? He would be sentenced to a mass grave outside of Mosul without any sort of trial. Iraq is seriously turning the corner.
A court convicted an Iraqi journalist of assault Thursday for hurling his shoes at George W. Bush and sentenced him to three years in prison, prompting an outburst from his family and calls for his release from Iraqis who consider him an icon for a nation decimated by war.
Imagine if he threw the shoes near Saddam? He would be sentenced to a mass grave outside of Mosul without any sort of trial. Iraq is seriously turning the corner.
Wednesday, March 11, 2009
The Vast Left Wing Conspiracy? The 8:45 Call
Now we have liberal groups banding together to get marching orders.
The “8:45 A.M. call,” as it’s referred to by members, began three weeks ago, and it marks a new level in coordination by the White House’s allies at a time when the conservative opposition is struggling for a toe-hold and major agenda items like health care reform appear closer than ever to passage.
They even engage in a little "politics of personal destruction" to use a Clinton era conceit.
The call has proved particularly effective at coordinating attacks on critics, said Jacki Schechner, the national communications director for Health Care for America Now, a labor-backed alliance of groups that support Democratic efforts to expand health care.
“There’s a coordination in terms of exposing the people who are trying to come out against reform —they’ve all got backgrounds and histories and pasts, and it’s not taking long to unearth that and to unleash that, because we’re all working together,” Schechner said.
At least the White House doesn't run these calls according to this:
Though White House officials do not participate in the calls, Palmieri said, the new infrastructure is closely tied to the White House. Podesta directed Obama’s transition, and Americans United for Change exists largely to run ads promoting the White House agenda. Some on the left, however, remain skeptical of the White House’s embrace.
If this crap can be traced directly to the White House then we have yet another case of fiddling while the economy burns. I'm all for "coordination the message" and partisan crapola when times are good because it distracts government officials from messing things up. But this should not be happening when we have a decent chance of slipping into Great Depression 2.
The “8:45 A.M. call,” as it’s referred to by members, began three weeks ago, and it marks a new level in coordination by the White House’s allies at a time when the conservative opposition is struggling for a toe-hold and major agenda items like health care reform appear closer than ever to passage.
They even engage in a little "politics of personal destruction" to use a Clinton era conceit.
The call has proved particularly effective at coordinating attacks on critics, said Jacki Schechner, the national communications director for Health Care for America Now, a labor-backed alliance of groups that support Democratic efforts to expand health care.
“There’s a coordination in terms of exposing the people who are trying to come out against reform —they’ve all got backgrounds and histories and pasts, and it’s not taking long to unearth that and to unleash that, because we’re all working together,” Schechner said.
At least the White House doesn't run these calls according to this:
Though White House officials do not participate in the calls, Palmieri said, the new infrastructure is closely tied to the White House. Podesta directed Obama’s transition, and Americans United for Change exists largely to run ads promoting the White House agenda. Some on the left, however, remain skeptical of the White House’s embrace.
If this crap can be traced directly to the White House then we have yet another case of fiddling while the economy burns. I'm all for "coordination the message" and partisan crapola when times are good because it distracts government officials from messing things up. But this should not be happening when we have a decent chance of slipping into Great Depression 2.
Why the French are Kicking our Asses: In Nuclear Energy That Is
This is a great article on the French nuclear industry and why it is so much better then our antiquated, stuck in the 70s, system. I think this is the part that I still don't understand.
But it is in the area of nuclear waste treatment that Paris and Washington disagree most strongly. The French have been recycling nuclear waste for some 25 years, a process the United States strongly opposes because it requires separating uranium from plutonium, which in theory could then be diverted to the production of nuclear weapons. The French argue that recycling waste material is the best way to deal with the waste problem and to ensure the long-term availability of uranium. "In France, we have confidence in the efficiency of the safety measures and in being able to control nuclear proliferation," Carré says.
There wouldn't even be a Yucca Mountain problem if Obama would simply get rid of the Carter era ban on recycling nuclear waste. I just don't understand this talk about nuclear bombs since we won't be using the plutonium to build them in the first place. It is like not recycling steel because it *might* be used to make tanks.
What I think should be done is the IAEA should get together with nuclear powered nations and create a world-wide nuclear waste disposal system. I think it should involve feeder reactors or some other way of using the the waste to create more energy. Call them waste reprocessing reactors and hook them into the grid as well.
This will actually do some good unlike the Kyoto Protocol that penalizes industrialized nations from engaging in industrialization. Then there should be some kind of plutonium monitoring system that insures that the plutonium is used in other reactors or stored somewhere and not used to make bombs.
But it is in the area of nuclear waste treatment that Paris and Washington disagree most strongly. The French have been recycling nuclear waste for some 25 years, a process the United States strongly opposes because it requires separating uranium from plutonium, which in theory could then be diverted to the production of nuclear weapons. The French argue that recycling waste material is the best way to deal with the waste problem and to ensure the long-term availability of uranium. "In France, we have confidence in the efficiency of the safety measures and in being able to control nuclear proliferation," Carré says.
There wouldn't even be a Yucca Mountain problem if Obama would simply get rid of the Carter era ban on recycling nuclear waste. I just don't understand this talk about nuclear bombs since we won't be using the plutonium to build them in the first place. It is like not recycling steel because it *might* be used to make tanks.
What I think should be done is the IAEA should get together with nuclear powered nations and create a world-wide nuclear waste disposal system. I think it should involve feeder reactors or some other way of using the the waste to create more energy. Call them waste reprocessing reactors and hook them into the grid as well.
This will actually do some good unlike the Kyoto Protocol that penalizes industrialized nations from engaging in industrialization. Then there should be some kind of plutonium monitoring system that insures that the plutonium is used in other reactors or stored somewhere and not used to make bombs.
Obama Signs Earmark Omnibus and Breaks Campaign Promise
Basically Obama just said that he will get it right next time.
Acknowledging it's an "imperfect" bill, President Barack Obama said Wednesday he will accept a $410 billion spending package that includes billions in earmarks like those he promised to curb in last year's campaign. But he insisted the bill must signal an "end to the old way of doing business."
Of course Obama could have signaled an "end to the old way" by vetoing this Bill and having Congress pass stopgap spending plans until they presented a Bill without earmarks. Of course that would have been actual "change"and Obama was going literally for "more of the same."
Acknowledging it's an "imperfect" bill, President Barack Obama said Wednesday he will accept a $410 billion spending package that includes billions in earmarks like those he promised to curb in last year's campaign. But he insisted the bill must signal an "end to the old way of doing business."
Of course Obama could have signaled an "end to the old way" by vetoing this Bill and having Congress pass stopgap spending plans until they presented a Bill without earmarks. Of course that would have been actual "change"and Obama was going literally for "more of the same."
Tuesday, March 10, 2009
Cramer Hits Back! Calls Stewart on Taking Him Out of Context
I think Cramer is finally understanding what it is like to be on the reciving end of the Obama attack machine. He needs to go on the Daily Show so badly! I think there might be a nice shouting match that will make TV History.
Take Frank Rich and Jon Stewart. Both seize on the urban legend that I recommended Bear Stearns the week before it collapsed, even though I was saying that I thought it could be worthless as soon as the following week. I did tell an emailer that his deposit in his account at Bear Stearns was safe, but through a clever sound bite, Stewart, and subsequently Rich -- neither of whom have bothered to listen to the context of the pulled quote -- pass off the notion of account safety as an out-and-out buy recommendation. The absurdity astounds me. If you called Mad Money and asked me about Citigroup, I would tell you that the common stock might be worthless, but I would never tell you to pull your money out of the bank because I was worried about its solvency. Your money is safe in Citi as I said it was in Bear. The fact that I was right rankles me even more. I never said the same thing about Lehman, where your accounts weren't safe. I expect a skewering from the comedian Stewart. I was shocked, however, that the rigorous Rich wouldn't investigate further and relied on the show's truncation of the truth. After all, how many times were the pull quotes from reviews by Rich used against him when he may have been panning a play in his former role as entertainment critic?
Take Frank Rich and Jon Stewart. Both seize on the urban legend that I recommended Bear Stearns the week before it collapsed, even though I was saying that I thought it could be worthless as soon as the following week. I did tell an emailer that his deposit in his account at Bear Stearns was safe, but through a clever sound bite, Stewart, and subsequently Rich -- neither of whom have bothered to listen to the context of the pulled quote -- pass off the notion of account safety as an out-and-out buy recommendation. The absurdity astounds me. If you called Mad Money and asked me about Citigroup, I would tell you that the common stock might be worthless, but I would never tell you to pull your money out of the bank because I was worried about its solvency. Your money is safe in Citi as I said it was in Bear. The fact that I was right rankles me even more. I never said the same thing about Lehman, where your accounts weren't safe. I expect a skewering from the comedian Stewart. I was shocked, however, that the rigorous Rich wouldn't investigate further and relied on the show's truncation of the truth. After all, how many times were the pull quotes from reviews by Rich used against him when he may have been panning a play in his former role as entertainment critic?
Jon Stewart Goes After Cramer: The Daily Show is Out of Their League
I guess with Bush back at Crawford all Stewart has left is his strange hatred for guys at CNBC. I love how he goes after Cramer on a stock pick weeks before the collapse. Um, Jon you know the Stock Market changes from week to week right? Check out this video
Of course Stewart doesn't say that even Warren Buffett was looking into buying a portion of Bear Stearns back in Sept 26, 2007. That was when the stock was trading at $123 a share. I'm sure Jon will now have to scream "F*ck You!" at the worlds richest investor. That is of course after he strings together a bunch of out of context stock picks by Buffett and uses "Oracle of Omaha" with little air quotes.
Cramer now needs to do the Daily Show and tell Stewart where to go. Jon is a funny guy but he should stick to Bush bashing and making faces. I think debating Tier 1 capital requirements at Citigroup is a little bit over his head and makes for bad entertainment on a comedy show.
It is sad when entertainers try to wrap their heads around financial matters. It is like watching a baby trying to comprehend D-brane states and annulus amplitudes in OSp invariant closed string field theory by Yutaka Baba. A lot of screaming followed by a little off camera crying.
Of course Stewart doesn't say that even Warren Buffett was looking into buying a portion of Bear Stearns back in Sept 26, 2007. That was when the stock was trading at $123 a share. I'm sure Jon will now have to scream "F*ck You!" at the worlds richest investor. That is of course after he strings together a bunch of out of context stock picks by Buffett and uses "Oracle of Omaha" with little air quotes.
Cramer now needs to do the Daily Show and tell Stewart where to go. Jon is a funny guy but he should stick to Bush bashing and making faces. I think debating Tier 1 capital requirements at Citigroup is a little bit over his head and makes for bad entertainment on a comedy show.
It is sad when entertainers try to wrap their heads around financial matters. It is like watching a baby trying to comprehend D-brane states and annulus amplitudes in OSp invariant closed string field theory by Yutaka Baba. A lot of screaming followed by a little off camera crying.
Congress Passes $410 Billion Earmark Omnibus
Well we are on hock for another $410 Billion in spending.
To the embarrassment of Obama — who promised during last year's campaign to force Congress to curb its pork-barrel ways — the bill contains 7,991 earmarks totaling $5.5 billion, according to the GOP staff of the House Appropriations Committee. Republicans got about 40 percent of the earmarks.
Yup, I guess that is just more Change We Can Believe In.
To the embarrassment of Obama — who promised during last year's campaign to force Congress to curb its pork-barrel ways — the bill contains 7,991 earmarks totaling $5.5 billion, according to the GOP staff of the House Appropriations Committee. Republicans got about 40 percent of the earmarks.
Yup, I guess that is just more Change We Can Believe In.
Citigroup Made a Profit? Really!
It seems that borrowing money from the US Government at 0% interest and then loaning it out at 6% is a good way to run a bank.
In a letter to employees Monday, Citi Chief Executive Vikram Pandit said the performance so far this year has been the bank's best since the third quarter of 2007 — the last time it recorded net income for a full period. Based on historical revenue and expense rates, Citi's projected earnings before taxes and one-time charges would be about $8.3 billion for the full quarter.
Maybe this will end some of the nationalization fears that the market has been having recently. Still those toxic assets are on the books and they are the real problem.
In a letter to employees Monday, Citi Chief Executive Vikram Pandit said the performance so far this year has been the bank's best since the third quarter of 2007 — the last time it recorded net income for a full period. Based on historical revenue and expense rates, Citi's projected earnings before taxes and one-time charges would be about $8.3 billion for the full quarter.
Maybe this will end some of the nationalization fears that the market has been having recently. Still those toxic assets are on the books and they are the real problem.
Obama Goes Against Teachers Union on Merit Pay
It seems Obama is going to put his head in the lions mouth and go head-to-head with the Teachers Union by supporting merit pay.
"Too many supporters of my party have resisted the idea of rewarding excellence in teaching with extra pay, even though we know it can make a difference in the classroom," he said, delivering the first major education speech of his presidency. "Too many in the Republican Party have opposed new investments in early education, despite compelling evidence of its importance."
He also supported charter schools but no word about school vouchers. The Washington DC voucher program is well liked by the community and actually helps poor children succeed and get ahead. It should be the model of the education reform that Obama wants.
"Too many supporters of my party have resisted the idea of rewarding excellence in teaching with extra pay, even though we know it can make a difference in the classroom," he said, delivering the first major education speech of his presidency. "Too many in the Republican Party have opposed new investments in early education, despite compelling evidence of its importance."
He also supported charter schools but no word about school vouchers. The Washington DC voucher program is well liked by the community and actually helps poor children succeed and get ahead. It should be the model of the education reform that Obama wants.
Monday, March 09, 2009
Red Chinese Bothering Our Ships: Testing the Obama Administration
It seems that the Red Chinese are testing the Obama Administration with a little gunboat diplomacy. Well, Chinese Bureau of Fisheries Patrol boat diplomacy anyway.
Chinese ships surrounded and harassed a Navy mapping ship in international waters off China, at one point coming within 25 feet of the American boat and strewing debris in its path, the Defense Department said Monday. The Obama administration said it would continue naval operations in the South China Sea, most of which China considers its territory, and protested to China about what it called reckless behavior that endangered lives.
If Obama pulls out the ships before their mission is over I can see the Chinese using that bit of knowledge to their advantage. They will then push a little further to see how free a hand they have against the US.
Look for Russia to rustle the bushes in the next few weeks. Maybe a little Ukrainian pressure by the Putinocracy will be used to take a measure of Obama's mettle. This is the best time to do it as well because it will goose oil prices and Obama can't respond as well due to the financial crisis. I still think Obama vs. Putin is a child fighting against a grown man.
Chinese ships surrounded and harassed a Navy mapping ship in international waters off China, at one point coming within 25 feet of the American boat and strewing debris in its path, the Defense Department said Monday. The Obama administration said it would continue naval operations in the South China Sea, most of which China considers its territory, and protested to China about what it called reckless behavior that endangered lives.
If Obama pulls out the ships before their mission is over I can see the Chinese using that bit of knowledge to their advantage. They will then push a little further to see how free a hand they have against the US.
Look for Russia to rustle the bushes in the next few weeks. Maybe a little Ukrainian pressure by the Putinocracy will be used to take a measure of Obama's mettle. This is the best time to do it as well because it will goose oil prices and Obama can't respond as well due to the financial crisis. I still think Obama vs. Putin is a child fighting against a grown man.
Dodd Looking Vulnerable in Connecticut
I hope Connecticut voters are finally understanding how bad this guy is in the Senate.
The silver-haired father of two young girls is facing his toughest re-election fight ever, and he doesn't even have an opponent yet. (CNBC pundit Larry Kudlow and former GOP Representative Rob Simmons have both expressed interest in running.) In a January Quinnipiac poll, 51% of Connecticut voters said they would not vote for Dodd in 2010.
What is even more dangerous about this guy is this little tidbit:
Still, the double distraction of a looming re-election battle and the ongoing health-care talks has some worried that Dodd might be neglecting the Senate Banking Committee at a crucial time, or at least be stretched too thin. "Health care is yet another distraction on the list of things that have distracted Dodd from his [Banking] Committee work," says one Republican Senator who has served with Dodd on the committee. "
Yes he will be working on health care reform at a time when US banks are in crisis. Talk about not putting your priorities in order. Fix the banks Dodd then you can work on Medicare or whatever pet projects you might have.
If the banks aren't fixed people will be worried more about the Great Depression 2 and then they are about who pays what when they go to the doctor. Maybe Dodd thinks that he has to fix Healthcare in order to stop all the stomach ulcers that he is giving people about his incompetence as the banking chairman.
The silver-haired father of two young girls is facing his toughest re-election fight ever, and he doesn't even have an opponent yet. (CNBC pundit Larry Kudlow and former GOP Representative Rob Simmons have both expressed interest in running.) In a January Quinnipiac poll, 51% of Connecticut voters said they would not vote for Dodd in 2010.
What is even more dangerous about this guy is this little tidbit:
Still, the double distraction of a looming re-election battle and the ongoing health-care talks has some worried that Dodd might be neglecting the Senate Banking Committee at a crucial time, or at least be stretched too thin. "Health care is yet another distraction on the list of things that have distracted Dodd from his [Banking] Committee work," says one Republican Senator who has served with Dodd on the committee. "
Yes he will be working on health care reform at a time when US banks are in crisis. Talk about not putting your priorities in order. Fix the banks Dodd then you can work on Medicare or whatever pet projects you might have.
If the banks aren't fixed people will be worried more about the Great Depression 2 and then they are about who pays what when they go to the doctor. Maybe Dodd thinks that he has to fix Healthcare in order to stop all the stomach ulcers that he is giving people about his incompetence as the banking chairman.
Geithner One-Man Gang At Treasury
I think the Obama people need to get this guy some assistants and deputies at the quick-step.
In the six weeks since Mr. Geithner took over as Treasury secretary, he and a skeleton crew of unofficial senior advisers have been racing to make decisions that will shape the future of the banking, insurance, housing and automobile industries.
I think they need to set up a Treasury Department job fair and get this department filled up.
In the six weeks since Mr. Geithner took over as Treasury secretary, he and a skeleton crew of unofficial senior advisers have been racing to make decisions that will shape the future of the banking, insurance, housing and automobile industries.
I think they need to set up a Treasury Department job fair and get this department filled up.
Friday, March 06, 2009
Intercontinental Exchange Gets Greenlight to sell CDOs
It seems that the $27 trillion dollar CDO market might finally go from the darkness to the light.
“Trading will be much easier,” he said. “We’ll see new players come to the market because they’ll like the idea of this being a better and more traded product. We also feel like over time we’ll see the creation of different types of products.”
Intercontinental plans to begin backing trades in the $27 trillion market on March 9, according to a company statement today.
Hopefully, it gets that market going again and provides some added liquidity for banks. It also gives an investor another avenue to hedge their position since they can buy the CDOs on a company's debt which goes up in price if the risk of failure in the company rises.Obama Lifts Stem Cell Ban
At last I can give Obama a little credit for doing something that I agree with.
President Barack Obama is set to sign an order keeping a campaign promise to lift restrictions on federal funding for research using embryonic stem cells, an administration official said.
President Barack Obama is set to sign an order keeping a campaign promise to lift restrictions on federal funding for research using embryonic stem cells, an administration official said.
Obama plans to sign the order on March 9, the official, who spoke on condition of anonymity, said.
This finally reduces a Bush era thing that I did not agree with at all. I think stem cell therapy might lead to a whole host of good things including the cure for cancer. Bush standing in the way of it pushed back science by at least 8 years. Now we can get the federal money flowing and get those scientists to work.
Unemployment at 8.1%: Some Say Stimulus Has Failed
It seems that things need to get worse before they get better. It seems that some people are damning the stimulus already:
“The magnitude of what is happening now is overwhelming what steps the Obama administration has already taken,” said Chris Rupkey, chief economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. “The situation is much worse now than when they began” considering stimulus efforts, he said.
Yup, I could tell from the start that Congress didn't look at each bit of that stimulus bill and say "how many jobs will this bit save." Instead they just shoved in a bunch of crap and thought +$13 more per paycheck for 95% of Americans will somehow create or save 3-4 million jobs. I guess it is time to get ready for Stimulus 2: Electric Boogaloo.
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