Year: 2008

Looks Like Murdoch Won’t Get Newsday

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Sam Zell bought Tribune company, and then couldn’t handle the debt, so he’s looking at selling Newsday, arguably one of the crown jewels of the empire.

A bidding war has erupted, with Rupert Murdoch (NY Post) and Mort Zuckerman (NY Daily News) fighting it out, but now it appears taht cablevision has trumped them both, bidding $650 million as vs. the roughly $580M of Murdoch and Zuckerman.

Newsday has generally had a good reputation for covering its region (Long Island), and it not becoming a part of Murdoch’s Newscorp is a good thing.

Economics Update

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Gee, Alan “bubbles” Greenspan is now saying that we are having an, “awfully pale recession.” Well, I guess he can still afford to eat at the Four Seasons, so it’s someone else’s problem…Neh?

Actually, I’m surprised that he did not use the unexpected growth in the service sector, with the ISM numbers rising to 52 from 49.6 (50 indicates growth).

His goal has always been more to prevent government intervention than giving an accurate assessment anyway, because he believes that preventing government action is the only thing that he can do of value.

Of course, the fact that oil busted the $120 barrier, hitting $120.21/bbl doesn’t bode well for the economy anyway.

Oil is up on supply fears from potential attacks in Nigeria and Kurdistan, along with the dollar weakening because of the Fed rate cuts.

Interest rates in the private sector, however, appear to be on the way up, with 30-year mortgages rates rising despite the Fed rate cuts. Additionally, the Fed is reporting that banks are tightening up on their lending at a historically high rate.

The fact that consumer bankruptcies are up almost 48% year over year in April might have something to do with this, or perhaps the other way around. It’s a chicken egg thing to me.

However, the fact that S&P has decided to stop rating bonds backed up by second mortgages seems to indicate that this still has a way to go on the way down.

The fact that companies cannot refi right now may very well take down ResCap, the 8th largest mortgage lender wing of GMAC:

ResCap, the eighth-largest U.S. residential lender in 2007, today began offering as little as 80 cents on the dollar to exchange or buy back $14 billion of bonds to extend maturities and stave off bankruptcy. To finance the debt restructuring, ResCap is seeking a new $3.5 billion credit line from its parent GMAC, which is owned by General Motors Corp. and an investor group led by Cerberus Capital Management LP.

“There is a significant risk that we will not be able to meet our debt service obligations, be unable to meet certain financial covenants in our credit facilities, and be in a negative liquidity position in June 2008,” Minneapolis-based ResCap said in a filing to the Securities and Exchange Commission today.

With all this going on, it’s not surprising that UBS is looking at cutting 8000 jobs.

A-330 MRTT Tanker Grounded for Modifications

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Needless to say, the Boeing rent-a-crowd is probably all over this, but really, this grounding is a normal part of a test program. (Paid Subscription Required)

Basically, they are installing updated plumbing, and setting up a remote station for the boom operator in the cockpit.

Earlier tests have been about verifying the airworthiness of the boom, which it passed in flying colors, with testing of the boom in use being done on a smaller A310 testbed.

The MRTT is almost identical to the KC-45 selected by the USAF.

Iraq, with an Iran Provocation Extra

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4 Marines died today, and Hiro Ibrahim Ahmed, the wife of President Jalal Talabani was the target of an assassination attempt, a roadside bomb targeting her as she went to cultural festival.

Note that this was in Baghdad, not Kurdistan.

I would also point to this story describing a pretty massive buildup at the Al Kut air base, which is just 35 miles from the Iranian border.

I can’t see this as anything but a deliberate provocation, or a prelude to an attack on Iran.

I think that Bush may attack Iran out of a petulant need to leave something else on his successor’s plate.

Zimbabwe: Opposition May Participate in Runoff

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At least they have not ruled it out, though they are calling for a foreign verification of the vote first.

Additionally, MDC is suggesting that some sort of power sharing may be possible witn ZANU-PF, but not with Robert Mugabe.

This is a sensible position. Mugabe appears to be viewed as a lame duck by even his allies, and this might be a way to ease him out.

The core of the matter is that considering the dire straights the country is in, whoever is president will have very limited options in policy, and the same applies to whoever leads the parliament, so “anyone but Mugabe” is not an unreasonable position.

Looks Like Large Home Builders Won’t Get Their Way

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In the home mortgage packages, one of the things that the lareg home builders have been lobbying for is a tax change to allow them to carry operating losses forward to profitable years, but it increasingly looks like this will not be a part of any mortgage bill.

There are a number of reasons, the first of which was that the Senate version of the bill has been lambasted by everyone as a bailout for builders and mortgage lenders, and the second is that the threat by homebuilders to cut off political donations overplayed their hand.

Basically, because of the level of pay for play in this action, it made standing up to the homebuilders a political win, because it shows “character”.

Senate Bill Drops C-17s, Funds F-22s (Sort Of)

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The Senate Armed Services Committee has passed a Defense Authorization bill which funds 20 additional F-22s, but does not fund additional C-17s. (more details at link)

Half way there. We don’t need either, though the F-22 funding also includes $497M for shutting down the F-22 line too.

The idea is to leave both options open to the next president.

Hopefully, the next president will have the guts to kill the white elephant that is the F-22.

Yes, There Are Similarities. Corruption is as Corruption Does

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Senator Whitehouse (D-RI) is noting that the firing of Mary Gade as regional administrator of region 5 for her attempts to keep dioxin out of the environment resembles the US attorney scandal.

Of course. When one believes that government is an unmitigated evil, as movement conservatives do, the only role for government agencies is to do favors for friends and allies.

Dow is a friend, poor children who you put at risk for cancer are not.

The Coming Collapse of the Middle Class

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Very good, but it’s about an hour long, so have the time to be really depressed.

In listening to the changes, I can only conclude that this is a direct result of avarice, stupidity, and malice by the leaders in the US in the political and business spheres.

The unspoken meme of the Reagan revolution was that if you were not rich, it was because you are evil, and thus the not rich must be punished.
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Iraq as Evidence of Basic Doctrinal Failings of the US Military

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So, we had an incident in the past couple of days in Sadr City, according to the western press, at least the New York Times, we had:

The ugly daily fight for ground in the poor Shiite neighborhood of Sadr City unfolded Saturday at a small mosque next door to a hospital, damaging the hospital and a number of its ambulances, and near a group of children who were wounded as they gathered tin cans to sell for salvage.

So, according to US military reports, dutifully reported by the Times, we have bombed a Mosque and damaged a hospital in the process, and that’s the best spin that they can put on this.

Compare this to the foreign coverage, though:

Twenty patients and workers in al-Sadr Hospital were wounded and 49 civilian and ambulance vehicles were damaged when U.S. warplanes opened fire at the hospital on Saturday, a health official said.

Even with the best possible spin, we have an atrocity (whether it’s a violation of the law of war is another matter). We bombed a mosque, a house of worship, and we did so with so many, or such large, munitions that we damaged the hospital next door, and somehow this will lead us to win this war?

Since WWII, the US military has had a fetish about applying air power to win wars.

  • The attempts by strategic bombing to destroy the German and Japanese war industries failed.
  • Air power in Viet Nam did not achieve its goals, and in fact aided recruiting among the DC and squelched dissent against the North Vietnamese government.
  • In desert storm, we discovered that numbers of tanks destroyed through air power were overstated.
  • Air power was unsuccessful in eliminating Serbian armor in the Kosovo campaign.

And now, in the campaign in Iraq, we are again relying on air power in ways that will, in the long run, cost more American lives, by moving the populace to supporting our opponents.

Well, Now I Know Why My Family is Insane…

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Because I’m completely nuts, that’s why.

It appears that my kids were overly rambunctious, and they decided that they must be some sort of evil robots, and started talking like the Daleks of Dr. Who fame.

I was downstairs for this bit, but when I came upstairs, and my wife was speaking to the kids like a Dalek, saying, “Destroy, destroy, destroy!!!”

I told her that it was completely wrong, that they didn’t say “Destroy”, they say “Exterminate,” and then I put my arm in front of my face to resemble the Dalek protrusion, and said:

Exterminate!!
Exterminate!!
Exterminate!!
….
Oh damn!!!! Stairs….Must exterminate architectural barriers.
Contact Congress!!
Legislate!!
Legislate!!
Legislate!!

I guess you had to be there.

George F. Will Is an Idiot

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Will, writing on Obama’s proposal to lift the earnings cap on wages, talks about the middle class folk who will be hurt, and gives the following example:

You favor eliminating the cap on earnings subject to the 12.4 percent Social Security tax, which now covers only the first $102,000. A Chicago police officer married to a Chicago public-school teacher, each with 20 years on the job, have a household income of $147,501, so you would take another $5,642 from them. Are they undertaxed? Are they rich?

Dude, the $102K limit is per individual. Their tax load does not change, they are both taxed on their total earnings.

Truth be told, I don’t think that there is a problem with Social Security, but there is one with Medicare, so here is my suggestion about how to fix that:

  • End the cap on employers’ part of the Social Security tax, and devote the additional revenue to Medicare and Medicaid.
  • Broaden the definition of earnings to include things like the sweetheart deals that senior executives get.
  • Tax the employee’s part of income at levels above $1 million.
    • This would mean that there is a “notch” between $102K and $1M. You can call it the Paris Hilton tax.

It would go a long way toward fixing the problem, and it is a much easier political sell.