Here:
[Secretary of the Treasurh Henry]Paulson said he doesn’t expect any more big financial institutions to fail.
He offered similar reassurances days before the failures of both Bear Stearns and Lehman Brothers.
Month: December 2008
Free Muntader al-Zaidi, Again
Well it appears that the Iraqi shoe throwing journalist has been tortured in prison, with an arm and ribs broken, and the Lebanese television channel NTV has offered him a job retroactively, “from the moment the first shoe was thrown”.
Not surprisingly, he has become a folk hero across the Arab world (see here andhere)
What is a surprise is George W. Bush is so completely clueless:
‘I’m not insulted. I don’t hold it against the government,’ Bush told ABC News in an exclusive interview. ‘The guy wanted to get on TV and he did. I don’t know what his beef is, but whatever it is, I’m sure someone will hear it.’
(emphasis mine)
Doesn’t know what his beef is? After invading and occupying his country, and killing at least 100,000 of his countrymen, forcing about 2 million into exile, and internally displacing another 2 million, in a country of 30 million, you don’t know what his beef is? (link)
Well, it looks like he may be getting some American style torture soon, because it’s been reported that Muntader al-Zaidi has been transferred to the Camp Cropper prison, which is US run.
Just How Gay is Joseph Farah?
It appears that some wag has regularly hacks Joseph Farah’s wiki page, and he is having a hissy fit about this.
The opening line reads:
Joseph Farah is an American author, journalist, and editor-in-chief of the website WorldNetDaily (WND). Farah is of Syrian and Lebanese ancestry.
And he replaces it with:
Joseph Francis Farah is an Evangelical Christian American journalist and noted homosexual of Lebanese and Syrian heritage.
(emphasis mine)
Let’s be clear, the guy doing defacing the Wiki entry is a jerk, because you don’t edit a wiki entry without some sort of citation, even if it’s just, “A friend of a friend of my cousin said that Joseph Farah sucked his dick,” anything else just vandalism.
That being said, when I look at that picture I do wonder about him, because that picture sets off my Gaydar, and I didn’t even know that I had Gaydar.
Then Don’t Send Loose Cannons on Diplomatic Missions
The UN High Commissioner for Human Rights, Navi Pillay, is objecting to Israel’s expulsion of Richard Falk, saying that, “”it is the responsibility of states to cooperate with the independent UN experts appointed by the UN Human Rights Council.”
He’s correct, of course, just as, for example members of the UN have an obligation not to appoint people who are batsh%$ insane to be their Ambassadors, so there is an obligation to criticize Bush and His Evil Minions™ for appointing John “The Mustache of Doom” Bolton to the UN.
Unfortunately, Richard Falk has no more control of his tongue than did the ‘Stache.
The man is an agent of a diplomatic organization on a fact finding mission, but he has made public statements which show that he should not be trusted with anything managing a Popsicle stand (or an academic department):
- Support for the 911 conspiracy theorists.
- Saying that, “”the depiction of [Khomeini] as fanatical, reactionary and the bearer of crude prejudices seems certainly and happily false … To suppose that Ayatollah Khomeini is dissembling seems almost beyond belief. … Having created a new model of popular revolution based, for the most part, on nonviolent tactics, Iran may yet provide us with a desperately-needed model of humane governance for a third-world country.”
- Describing Israeli actions in the disputed territories as a Holocaust.
- Asking to investigate Palestinian abuses, but only to “insulate” the HRC from accusation of bias, which constitutes an explicit admission of bias on his own part.
(And that’s just from a quick glance at his wiki)
Speaking as someone who was, and is, profoundly embarrassed by the fact that John Bolton is still given time in news shows and not relegated to circus acts, and horrified that snake oil salesman Benyamin Netanyahu was, and might be again, PM of Israel, the answer to the question is not to appoint equal and opposite nutjobs.
There are dozens, perhaps hundreds of people who could bring a dedication to the job, what’s more, I’ve searched the net, and found no evidence that he either speaks Arabic or Hebrew, and at the very least, the investigator should be conversationally fluent in Arabic.
If an investigator cannot speak the language, it is very difficult for them to investigate. To rely on representatives of one government or the other to supply translators is to place a filter on on communications by the party supplying the translator.
Someone Smacked Merkel With a Clue Stick
Because she just gave a speech saying that she was moving away from Hoovernomics, and that the German government would take direct stimulus action, as opposed to the tax cut she has been keeping in her pocket for election time.
Auto Update
So, Bank of America suggests that GM might need $30 billion to survive, which is still about 1/10 of what AIG has gotten.
In any case, Bush and Paulson and their Evil Minions™ are considering a Car Czar who would have the power to force bankruptcy on the automakers, and an auto analyst is predicting that the Bush Administration will use this for crass political gain, and demand concessions, which Obama would likely overturn, because not all the stake holders are involved in those concessions.
Particularly in the case of GM, one issue is concessions from the local dealers, and that scares every member of Congress, because auto dealers have always been extremely aggressive political donors and political forces in the districts.
In any case, as more reports emerge that Bush and Paulson are close to a deal, I am again compelled to make the repeat the wisest thing that I’ve read this century:
But it does inspire in me the desire for a competition; can anyone, particularly the rather more Bush-friendly recent arrivals to the board, give me one single example of something with the following three characteristics:
- It is a policy initiative of the current Bush administration
- It was significant enough in scale that I’d have heard of it (at a pinch, that I should have heard of it)
- It wasn’t in some important way completely f#$@ed up during the execution.
Seriously. I’ve yet to see anything wiser yet, and I’m using the loose definition of the 21st century which includes the year 2000.
Minnesota Corruption Update
The Star Tribune notes that Norm and Laurie Coleman, her boss, Jim Hays, and Coleman Supporter Nasser Kazemini have all high-powered retained lawyers on a matter currently being investigated by the FBI, in which allegations have been made that Kazemini funneled money to Norm Coleman via Laurie Coleman, using Jim Hays insurance company as a conduit.
The interesting paragraph in the article, and I did not catch it, the good folks at TPMMuckraker did is this:
Norm Coleman has hired Doug Kelley, Laurie Coleman is represented by Earl Gray, Hays is aligned with Doug Peterson and Kazeminy has secured the services of Joe Friedberg.
Norm and Laurie have separate lawyers. While this does not mean that they will roll on each other…yet…but it does mean that this is serious, and that they are taking this very seriously.
Heh.
Election Update
Well, the Star Tribune had a “reader analysis” of images of some of the challenged ballots, and they ran the numbers from that, and concluded that Franken would win.
So, Coleman’s lawsuit against counting ballots continues, and the Minnesota Supreme Court has agreed to hear arguments tomorrow but they did not grant an injunction, which indicates that they did not see anything earthshaking in the filings.
In the mean time, TPMElectionCentral has been live blogging the canvassing board, and we have notice that the Coleman campaign is reissuing challenges to ballots that it had previously withdrawn, and that Franken’s challenges, which were reviewed first (it’s going to be a multi-day process at least) seem to be generally be well received by the board, i.e. not considered bogus, and he’s picked up about 43 votes, which is ahead of where Franken’s team was predicting the numbers, and they predicted a 4 vote win.
Again, this is going to be tight in either case.
Jesse Jackson, Jr. May Have Already Been Talking to Fitsgerald
If this is true, I think I know why he sounded so pissed at that press conference.
He still won’t be Senator, but if he dropped a dime on Blagojevich months ago, he’s pretty much in the clear on this:
ABC7 has learned that since late last summer, the congressman has worked with federal prosecutors, informing on an alleged Blagojevich administration scheme two and half years earlier.
……
And sources tell ABC7 that Jackson has been in regular contact with the feds and has told the government that in 2003 Blagojevich denied the congressman’s wife Sandi an appointment as Illinois lottery director because Jackson would not donate $25,000 to the governor’s campaign fund.
I’m not sure who the sources are, because generally Fitzgerald runs a pretty tight ship, but if this story is accurate the distinguished gentleman from Illinois has been very ill served by all of this.
Economics Update
The big news, the Fed basically giving up and lowering its rates to what is effectively zero, I just posted, but that’s not the only central bank news today.
The European Central Bank is considering cutting its overnight deposit rate, and the Bank of Japan is looking at ‘quantitative’ monetary easing, things like buying commercial paper outright.
I think that we may see the printing presses cranking up fairly soon, and as I’ve said before, this might not be a bad thing: inflating our way out of the housing crunch as a way to staunch the bleeding in the credit bubble. (I think I just violated some regulations on mixing metaphors, and the English Instructor Swat Team will come after me, red pencils blazing)
In any case, the Federal reserve cutting rates by ¾% has pushed the dollar down today and pushed treasury yields down to new lows.
That second one is part of the goal, the idea that lower yields will move people to more risky investments, but since people have already accepted negative yields, I’m not sure that it will make a difference.
In the mean time, those who worry about a deflationary spiral, are not relaxed folks today, with the CPI in the United States dropping by 1.9% (non-seasonably adjusted) and 1.7% (seasonably adjusted), the biggest drops since 1932 and 1947 respectively.
Anytime you hear an economic statistic, followed by, “since 1932,” it is not a good thing….I’m just saying…
Needless to say, this is hitting with real estate too, with housing construction starts falling 18.9% in November, to 625K, the lowest number since records started being kept on this in 1959.
Anytime you hear an economic statistic, followed by, “since 195,” or, “since records started being kept,” it is not a good thing either….I’m just saying…
In Southern California, one of the areas hardest hit by the housing bubble, prices are down 5% for October-November, and 35% from November last year.
I’ve seen a few stories about how selling is picking up in California, but this really is people scavenging foreclosures and oft-mentioned the dead cat bounce.
In energy, OPEC meeting opened with calls to cut production by 2 million bbl/day, which, along with the falling dollar and Fed rate cut, pushed oil up, but only by a bit less than a dollar.
Retail gasoline was up again today, but still has not moved more than a penny above its recent low.
Monetary Policy is Dead
Alan Greenspan did most of the work, but Ben Bernanke finished it off.
They cut their rates by 75 basis points (¾%), so the interbank rate went from 1% to a range of 0%-¼%, the lowest level since the Fed started publishing the number in 1990, and the discount rate was cut from 1.25% to ½%.
What this means that is interest rates are close enough to 0% that there is no further lowering that will make a difference….Actually, I don’t think that this will make a difference
The Fed statement is below, it it does sound dire, even to someone like me, who doesn’t read the fish entrails that are FOMC statements:
Press Release
Federal Reserve Press ReleaseRelease Date: December 16, 2008
For immediate releaseThe Federal Open Market Committee decided today to establish a target range for the federal funds rate of 0 to 1/4 percent.
Since the Committee’s last meeting, labor market conditions have deteriorated, and the available data indicate that consumer spending, business investment, and industrial production have declined. Financial markets remain quite strained and credit conditions tight. Overall, the outlook for economic activity has weakened further.
Meanwhile, inflationary pressures have diminished appreciably. In light of the declines in the prices of energy and other commodities and the weaker prospects for economic activity, the Committee expects inflation to moderate further in coming quarters.
The Federal Reserve will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability. In particular, the Committee anticipates that weak economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time.
The focus of the Committee’s policy going forward will be to support the functioning of financial markets and stimulate the economy through open market operations and other measures that sustain the size of the Federal Reserve’s balance sheet at a high level. As previously announced, over the next few quarters the Federal Reserve will purchase large quantities of agency debt and mortgage-backed securities to provide support to the mortgage and housing markets, and it stands ready to expand its purchases of agency debt and mortgage-backed securities as conditions warrant. The Committee is also evaluating the potential benefits of purchasing longer-term Treasury securities. Early next year, the Federal Reserve will also implement the Term Asset-Backed Securities Loan Facility to facilitate the extension of credit to households and small businesses. The Federal Reserve will continue to consider ways of using its balance sheet to further support credit markets and economic activity.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Christine M. Cumming; Elizabeth A. Duke; Richard W. Fisher; Donald L. Kohn; Randall S. Kroszner; Sandra Pianalto; Charles I. Plosser; Gary H. Stern; and Kevin M. Warsh.
In a related action, the Board of Governors unanimously approved a 75-basis-point decrease in the discount rate to 1/2 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of New York, Cleveland, Richmond, Atlanta, Minneapolis, and San Francisco. The Board also established interest rates on required and excess reserve balances of 1/4 percent.
The Google Kerfluffle
So, we have The Wall Street Journal doing a story with a screaming headline about how Google is attempting to subvert network neutrality.
Note that the Journal‘s editorial page has long argued against network neutrality, and Google has long championed the idea that ISPs should act as common carriers.
Well, they note one of Google’s main allies, Larry Lessig, has shifted his position to match Google’s, which he shows (with footnotes) to be wrong.
Then Google explains that what it is doing is placing caching servers to better response time, not buying enhanced access to the last mile of wiring to the home.
It’s called “edge caching”, and Akamai has been doing since 1998.
While Google’s actions might be troubling to Akamai, they would likely see a huge new competitor in this market, this is nothing new.
Additionally, the article claims that Obama and his people are walking backwards from their commitment to network neutrality, a charge which they unequivocally deny.
We also have Wired.com calling bullsh$# too.
And finally, if you need any more convincing, isen.blog plucks this little jewel from the article:
One major cable operator in talks with Google says it has been reluctant so far to strike a deal because of concern it might violate Federal Communications Commission guidelines on network neutrality.
“If we did this, Washington would be on fire,” says one executive at the cable company who is familiar with the talks, referring to the likely reaction of regulators and lawmakers.
As David Isenberg so rightly notes, “Yeah, right, the cable guys want to preserve Network Neutrality, while Google wants to violate it. That **would** be a boy-bites-dog story, if it were true.” (emphasis original)
Additionally, he makes some good notes on the regulations on this:
Google’s FCC counsel, Rick Whitt explains that Google simply seeks to do edge caching, just like Akamai, Amazon, and several other companies. The idea of edge caching is to locate frequently used content closer to the people who access it. It makes accessing the cached content faster.
Importantly, since the cache must be connected to the Internet by a big, fat, stupid [emphasis mine] pipe, the company doing the caching can, in principle, buy pipes from any carrier. Indeed, if it is concerned with up-time, local congestion, or avoiding single points of failure, it will buy connections from several providers. [See my “Buy as Many Nines as you Need“]
Also, in principle, carriers can let any edge cache access its network. Indeed they have a duty to do so, under the Doctrine of Public Callings, the doctrine of common law that underlies common carriage and network neutrality that has been in effect for about 900 years now. [emphasis mine]
Net Neutrality only becomes an issue when a carrier picks and chooses which cache to supply pipes to.
The argument the WSJ seems to be making — and they don’t make it very well — is that when Google has an arrangement with carriers to provide a cache it advantages its access. However, it has always been the case that Google pay a carrier more for a fatter pipe to its content. Edge caching is another case of that, no matter in which building a caching platform might be located.
In other words, if Google does edge caching it buys access. It’s the same as when I, as a residential customer, pay $34.95 for one megabit DSL service or $49.95 for 3 megabit DSL.
The concern of Network Neutrality advocates is not with access but with delivery. The fear is that Internet connection providers would charge for expedited delivery of certain content to the end user, and in so doing would put themselves in the business of classifying which content gets enhanced delivery. Since they were charging for expedited delivery, they’d get more revenue for improving the enhanced delivery, so the only network upgrades would be for the enhanced service. Non-enhanced would fall further and further behind. Plus the power to decide what gets delivered might, indeed, be powerful, and power corrupts; just ask NARAL.
(NARAL was denied the ability to send text message alerts to people who had opted in to by Verizon wireless, because abortion rights are icky.)
NY Senate Seat
Well, it appears that Governor Paterson is close to a decision, though he won’t announce until after Hillary is approved as Secretary of State and resigns, and that Caroline Kennedy is now actively seeking the Senate seat.
This would be a disaster, and perhaps the only way the Republicans have a chance of picking of the seat in 2010.
Caroline Kennedy is an intensely private person (or at least as intensely private as you can be if you are a child of JFK), and she is a lousy campaigner, as was shown on those few occasions that she the stump for Obama.
She may not be as bad at campaigning as her cousin Kathleen Kennedy Townsend, who gave Republicans the Governor’s mansion for the first time since Spiro Agnew in Maryland, but it’s close.
There is also the entire dynastic issue, which is troubling.
While there are other likely candidates for this seat (Andrew Cuomo) who have clearly got a leg up on the political ladder because of their parentage, Kennedy has never before even taken the ladder out, and it is simply in conflict with what should be American values to hand her a position like this.
More Economic Journamalism
So here we have a story on the brighter side of a near complete collapse of our credit system, which opens with this ‘graph”
Dec. 15 (Bloomberg) — Bill Clinton was forced to abandon spending initiatives to boost the economy at the start of his presidency when advisers warned him that the borrowing needed to fund the programs would push interest rates higher. President- elect Barack Obama may not have the same problem.
No, he was forced to back off those initiatives because Alan Greenspan threatened crushing interest rate increases if Clinton actually tried fiscal stimulus, because he opposed such policy on philosophical grounds.
To suggest anything else means that you are a liar or too stupid to cut your own meat.
A Correction: Henry Blodget Did Not Get a A Haircut
When I wrote that he invested with Madoff, I was referring to this article, which mentions both Blodget and Ezra Merkin in the same ‘graph, and got confused:
“I am shocked, as I know you are, by this fraud,” Merkin wrote. “As one of the largest investors in our fund, I have also suffered major losses from this catastrophe.” Analyst Henry Blodget wrote on his blog Friday that some savvy investors figured Madoff was up to something because his returns were so high.
I saw the name “Blodget”, and the phrase “major losses”, and tied the two together, when I should have read carefully, and realized that it applied to Mr. “Pubic Hair Wig” (look up Merkin).
Also, as much as it pains me to say, Blodget is correct in his analysis, that people were investing with him because they thought that he was cheating:
So why did these smart and skeptical investors keep investing? They, like many Madoff investors, assumed Madoff was somehow illegally trading on information from his market-making business for their benefit. They didn’t consider the possibility that he was clean on that score but running a good old-fashioned Ponzi scheme.
When one considers his numbers, this is true. While his victims are victims, they are also crooks, guilty of felony conspiracy, because they entered into this deal knowing that it was crooked.
Unfortunately, I don’t think that there is enough there to get a conviction from a jury, and even if you did, my guess would be that the judge would then dismiss any conviction, but a few show trials would be a good thing.
Obama Staffing Update
Senator Ken Salazar as Secretary of Interior, he will be replaced by an appointment from a Democratic governor….Hopefully someone a bit less conservadem than Salazar.
Also Chicago schools chief Arne Duncan as Secretary of Education. I don’t know much about him except that he’s likely to be the best hoops player on the cabinet, he play professionally in Australia.
Hero
Newsweek has the story of Thomas Tamm, the whistleblower who blew the lid off the illegal NSA surveillance program.
Their tag line after the hed is, “Is he a hero or a criminal?”
He is a hero:
In the spring of 2004, Tamm had just finished a yearlong stint at a Justice Department unit handling wiretaps of suspected terrorists and spies—a unit so sensitive that employees are required to put their hands through a biometric scanner to check their fingerprints upon entering. While there, Tamm stumbled upon the existence of a highly classified National Security Agency program that seemed to be eavesdropping on U.S. citizens. The unit had special rules that appeared to be hiding the NSA activities from a panel of federal judges who are required to approve such surveillance. When Tamm started asking questions, his supervisors told him to drop the subject. He says one volunteered that “the program” (as it was commonly called within the office) was “probably illegal.”
Tamm agonized over what to do. He tried to raise the issue with a former colleague working for the Senate Judiciary Committee. But the friend, wary of discussing what sounded like government secrets, shut down their conversation. For weeks, Tamm couldn’t sleep. The idea of lawlessness at the Justice Department angered him. Finally, one day during his lunch hour, Tamm ducked into a subway station near the U.S. District Courthouse on Pennsylvania Avenue. He headed for a pair of adjoining pay phones partially concealed by large, illuminated Metro maps. Tamm had been eyeing the phone booths on his way to work in the morning. Now, as he slipped through the parade of midday subway riders, his heart was pounding, his body trembling. Tamm felt like a spy. After looking around to make sure nobody was watching, he picked up a phone and called The New York Times.
He has a defense fund, H/t to Firedoglake for this information:
Thomas Tamm Legal Defense Fund
Bank of Georgetown
5236 44th Street
Washington, DC 20015.
Free Muntader al-Zaidi
He’s the journalist who threw his shoes at Bush, and it appears that he has been charged with insulting the Iraqi state as a result.
There are already demonstration protesting his detention.
Obama Vote vs 1860 Cotton Production
I’m not sure what it means, but my guess would be that the counties in question have traditionally high black populations:
The dots represent cotton production.
Economic Journamalism
First we have economist Dean Baker makes the observation that the gross number is driven largely by utilities, and consumption of utilities is driven by weather, which is what typically happens in November relative to October.
Then he notes that frequently when a month is revised downward, it makes the next month looks better, which is what did happen this October.
But still we get stories like this headline, “Manufacturing Still Dismal, But Not as Bad as Feared.”