Month: July 2007

What Alan Said

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As an aside, I rather imagine that Princes William and Harry would like to see the same thing with Paparazzi’s motor bikes.

Ground those TV choppers
The senseless death of four helicopter newsmen in Phoenix underscores the stupidity and wastefulness of broadcasters who squander their precious resources on cheap chopper chases instead of more worthy pursuits.

This journalistically indefensible insanity must be stopped. If broadcasters won’t do it voluntarily, then the Federal Aviation Administration, acting on behalf of us innocents on the ground, ought to step in and do it for them.

So says Alan Mutter, and so say we all.

Helicopter footage of a car chase or a fire is not news, it’s porn masquerading as news.

Whiskey Foxtrot Tango??? Housing Bubble Bust in Anchorage??? Anchorage????

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Well, it looks like the housing bubble is bursting in Anchorage Alaska.

That’s right Anchorage, which is pretty remote, unless you live in Ketchikan.

Time on market has more than doubled.

Same thing with Hawaii, which geographically is one of the most remote locations on earth.

This is not a real estate crash. This is an easy credit, blood the economy with liquidity crash. That’s why this is not local.

People don’t buy houses on price, they buy it on monthly payments, and mortgages are still about 3% lower than historical norms.

The difference from 2 years ago is that the low rates created a frenzy, where people were afraid that they would never own if they did not buy right now.

Now there are people who believe (correctly) that if they wait, they will get a better deal.

That’s why you are seeing this in places like Anchorage, Honolulu, Wichita, and Indiannapolis. It’s a nation wide phenomenon.

FDA Once Again Kowtows to Industry

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An FDA task force is recommending that no notice be given to consumers about the use of nanotechnology in their food and drugs. Big surprise, Bush toadie and FDA commissioner Dr. Andrew von Eschenbach said he endorsed the report and its recommendations.

The AG department has done the same thing with genetically modified organisms, and forbidden testing for Mad Cow in the US.

These organizations should be about protecting the consumer first, but nut in a Republithug administration.

Things I Really Hate

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Number 773 on the list:

The fact that Coca Cola® has come out with a number of new flavors, New Coke, Cherry Coke, Lime Coke, Chocolate Coke, Beer Coke, etc. that have packaging almost identical to Coke Classic®.

I think that part of their marketing scheme is to get people to try the new varieties by mistake.

The special today came with a 20 oz bottle of Coke, and I just got a mouthful of something like Anchovie Coke®.

Blech.

Who Hasn’t Been Tempted to Do This?

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It appears that NASA has lost nearly 100 million of taxpayer purchased equipment in the past decade.

It appears that there are few controls in place for about $35 billion of assets.

That being said, the story of the lost laptop is my favorite:

It cites one employee who excused himself (or herself) of losing a laptop worth $4,000 with the explanation that the machine had burned up in the atmosphere.

The lost equipment report included the following explanation: “This computer, although assigned to me, was being used on board the International Space Station. I was informed that it was tossed overboard to be burned up in the atmosphere when it failed.”

That sure as hell beats, “the dog ate my homework”.

You know, if I were in orbit, that’s what I’d do to a computer that was #$%%ing up badly. I’d watch it all the way down.

It’s Not Just Subprime Home Loans

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It appears that many of the companies that borrowed through the subprime market will take it on the chin.

The report shows that about $680bn of loans will mature between 2008 and 2011 compared with only $180bn of maturing high-yield bonds.

Mariarosa Verde, head of credit research at Fitch, said the loan market was “critical to the wellbeing of these companies”.

Many highly leveraged firms rely on their ability to roll over existing loan debt into new loans rather than repay it when it matures, which they often cannot do.

The basic calculus is this:

  • Longer term loans are far riskier to the lender. It ties up the capital for a longer period, and there is a greater risk that the interest fall below market rates.
  • Risk requires greater return, so long term bonds are more expensive
  • Companies that get junk bonds cannot afford the rates of longer term loans, so they get short term ones, and roll them over at the end of the term.
  • When these loans come due, they refinance.
  • If rates have increased significantly, they take it on the chin, bankruptcies and liquidation.
  • This increases the risk, and hence the interest rates, putting more companies at risk.

Greenspan’s policy of flooding the market with liquidity after the dotcom crash will have dire consequences in the next few years.

We Are Starting To See Empty Houses in High Rent Neighborhoods

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It appears that we are starting to see An epidemic of abandoned houses.

This story is set in Chandler, AZ, just outside of Phoenix, but this is not the only place where this is happening.

A significant portion of the recent Chandler complaints are from newer neighborhoods in southeastern parts of the city where homes once sold for $400,000 or more and values have dropped, Carr said. Buyers who divorce, lose a job or can’t afford rising adjustable-rate interest are finding they can’t sell their houses for what they owe on them, he said.

This dovetails nicely into the return of Hoovervilles (Favelas) that I wrote about earlier.

The new economy that was supposed to be unleashed by deregulation is an old economy, a very old one. One that ended on Black Tuesday in 1929.

Even worse, it will be years before we can make what we need, because our economy has been hollowed out.

Why the Lib Dems are Condemned to Irrelevance in UK Politics

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It appears that there is a bit of a problem in Devon, three councilors have left the party because another member does stripograms and phone sex as a livelihood.

They have left the party, and are now sitting as independents because, “We believe that our integrity and principles will be compromised if we stay.”

At the party level, it is reasonable to try to get rid of her because you believe that she will not win re-election or is a drag to the party, but if you are willing to leave the party over this, you are not serious about the party, and most likely, the party just isn’t that serious either.

Destroying the Army We Have?

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It appears that the US Army will fall significantly short of its recruiting goals this year.

The service missed its active-duty recruiting goal by 16 percent in June, the worst showing in two years. The shortfall was particularly worrisome to Army leaders because the summer, after students have graduated high school, typically is the best recruiting season.

Remember, that is with the Army relaxing standards, and allowing people with records, and sporting gang tats into the military.

As badly screwed as the military was after Viet Nam, this is going to be far, far worse.

Signs of the Coming Crash: Exotic Liquidity Instruments

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I came across a term that I had never heard before, Dark liquidity pools.

These pools are basically a private and unregulated system of equity and bond trading.

It allows people to execute large purchases and sales without any public knowledge.

An activist hedge fund, for instance, may not want to reveal that it is buying up large blocks of stock in a company it is about to attack, or a mutual fund might want to sell a large amount of stock without causing a downdraft that would hurt any shares it still holds.

In a less enlightened era, this might be called fraud or insider trading, but those quaint notions originating from the FDR era reforms have been set by the wayside as a result of “reforms” beginning in the late 1970s (Thanks Jimmy Carter), accelerating in the 1990s (thanks Bill Clinton), and regulations have been largely ignored in the 2009s.

What’s more, the uses of these instruments are exploding.

The hunger for anonymous block trading has caused the field to explode. There are about 40 active pools, double the number just last year. New pools and services to aggregate them are announced almost every month.

We should be concerned because it is yet another way for the insiders to make money off the information asymmetries in the market, and to further leverage their investments.

Much Like in 1929, theese will come back to haunt us. Without transparency, when reverses will set off a cascade of collapse, much in the way that they did on Black Tuesday, because the public prices will no longer accurately reflect asset values, and people will be trading blind.

Schedule Slips on B-787

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It looks like Boeing will be slipping the first flight of the 787 until September.

Boeing management is saying that, “But delivery of the first 787 to All Nippon Airways in May 2008 remains possible, (Boeing CEO Jim) McNerney says, even if the already compressed flight test schedule shortens to seven months.”

I discussed this possibility earlier (also here), and said that it was likely that there would be delays in deliveries.

It’s coming to light now because Boeing has a different culture from Aribus, which had similar problems with its A340, and as a result tends to be more upfront about such things.

The Kitty Grim Reaper

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It appears that a cat in Steere House Nursing and Rehabilitation Center in Providence, Rhode Island brings death with its cuddles.

The cat, named Oscar, is normally standoffish, but will cuddle up to people in the last 4 hours or so before death.

Probably something to do with the cat sensing or smelling something that we can’t.

Then again it’s a cat, so maybe it just brings death along.

Thomas Graves, a feline expert and chief of small animal medicine at the University of Illinois College of Veterinary Medicine, described Oscar’s actions as “such a cat thing to do”, but admitted: “Those things are hard to study. I think probably dogs and cats can sense things we can’t.”

Dr Teno concluded: “I don’t think this is a psychic cat. I think there’s probably a biochemical explanation.

More Death cats:




Not sure if the last one is a death cat, but if looks could kill…

Only the Jesuits Would Think of This

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It appears that the Society of Jesus (Jesuits)will be venturing into Second Life saving virtual souls from their virtual sins.

OK………

I got nothing here beyond the title.

I had a friend who wanted to carry the papal favor into battle in the SCA (Medieval combat), and he wrote the Vatican. He got back something like a 12 page letter full of questions from a Jesuit asking about the SCA. (His request was denied)

They are an eclectic bunch.