And 100% correct. The numbers now are already worse than the “worst case” scenario that the Treasury is using.
The Money quote is, “Conclusion: Actual macro data for 2009 are already worse than the more adverse scenario in the stress tests. These are not stress tests but rather fudge tests.” (emphasis original)
I agree.
Phil Spector was found guilty of Lana Clarkson’s death, and Ivory Snow girl, and pr0n superstar, Marilyn Chambers died at 56.
They are both sad. 56 is young to die, and Spector has clearly been profoundly mentally ill for years.
Because he is, well, Phil Spector, people let it pass, and he never got the help that he needed.
This is getting way out of hand, and someone needs to go postal on everyone involved in this process:
There’s a major problem and a minor problem. The minor problem is documentation. I’ve spent four weeks now looking for someone who can give me the details of the stress test so that we can do an independent evaluation of whether the stress test is any good.
We get: “someone will call [you] right back.” Only the call doesn’t come.
Hopefully, this will improve with Kashkari’s replacement, but my guess is that this comes from Geithner, not Kashkari.
Pfizer sent Viagra® boxer shorts as a freebie to Irish doctors.
It’s a good thing that it wasn’t Burger King sending out Home of the Whopper® thongs.
If anyone finds a pic out there, email me a link to the pic.
Goldman Sachs, as I mentioned yesterday, is looking to sell shares to pay off the TARP, which is made easier by their recent profit numbers.
How did they make those numbers, it turns out that they put their losses into December, and then dropped the month from their quarterly results
Goldman’s 2008 fiscal year ended Nov. 30. This year the company is switching to a calendar year. The leaves December as an orphan month, one that will be largely ignored. In Goldman’s earnings statement, and in most of the news reports, the quarter ended March 31 is compared to the quarter last year that ended in February.
The orphan month featured — surprise — lots of write-offs. The pretax loss was $1.3 billion, and the after-tax loss was $780 million.
How remarkably convenient.
Then we have Wells Fargo, which also announced good quarterly results, and now analysts are saying that losses uncovered in the stress test will uncover $120 billion in losses, and require that $50 billion in capital be raised.
But wait, there’s more, as other analysts are saying that Bank of America is likely seriously short on capital, and will need to dilute its shareholders stocks.
Finally, because they haven’t boned the taxpayer enough, Citigroup is looking to cut its conversion ratio, the rate at which it is planning to convert its preferred stock to common stock, and the largest preferred shareholders is, you guessed it, the American taxpayer, because the share price for the common stock has gone from about 98¢ to $3.97/share when I checked the number today.
Timothy “Eddie Haskell” Geithner should go tell Citi CEO Vikram Pandit to go Cheney himself, but he won’t because, he’s is the big bankers’ bitch.
The Tedisco campaign is objecting to student ballots, in violation of the law and established court cases, and they are striking absentee ballots of voters with “Jewish” Names, who are assumed to be Democratic voters, and many of the folks have been registered in, and voting in, the district for decades:
The Democrats plan to argue in court, citing precedent, that the votes are valid so long as voters with multiple residences don’t cast ballots in multiple places. Garry even went one step further, holding up his yellow pad and showing the names of those challenged, suggesting that Walsh was also acting with regard to ethnicity.
“Cohen, Pollack, Rosegarten, Winakor—there’s a pattern: they’re Democrats and they’re Jewish,” he said.
If you think that Jews have a home in the Republican party, you are an idiot.
We have a bumpy road ahead on the economy, with
retail sales falling 1.1% and the Producer Price Index (PPI) falling 1.2%, both of which indicating that there are still deflationary and recessionary pressures out there.
In regulation, there is finally an Obama choice to run the TARP, Fannie Mae CEO Herb Allison, replacing Bush holdover Neel “Cash and Carry” Kashkari, who along with Hank Paulson, should be in jail for the fraud perpetrated on the US taxpayers.
We also have some news from the moniliner insurers, after a long break, with Moody’s downgrading Ambac to junk status.
Dead man walking.
That being said, there are more signs that credit is thawing, with the LIBOR, the rate big banks charge each other for loans, falling at the fastest rate in 3 months.
In currency, we have news from Asia, where Singapore has devalued its currency by lowering interest rates in an attempt to stem its recession, the idea being that its export based economy would be boosted by a falling currency.
This is a fairly limited option for most nations, as many nations that need the help are debtor nations, while Singapore is a creditor nation.
Meanwhile, the US dollar is up vs. the Euro and down vs the Yen.
The three judge panel soundly rejected Norm Coleman’s arguments, using the term “absurd” in their opinion to describe some of his arguments, and hit his campaign with sanctions, requiring that the Coleman campaign reimburse both the election court and the Franken campaign for a portion of their legal expenses. (click image for full size)
Coleman has 10 days to appeal to the state Supreme court, and will probably use all of that time, since delay is what the ‘phants are paying for, and now everyone’s 2nd favorite Minnesota slimebag, Governor Tim Pawlenty, has signed on to the delay Franken at all costs camp, because it will help his bid to the the Republican nominee for President in 2012.
For weeks, he has said that he would sign the certification when the state courts ruled, and now he’s saying that he’s likely to wait for the federal courts, in contravention of Minnesota law.
Lawyers for Goldman Sachs have gone postal on GoldmanSachs666.com, a website dedicated to criticizing the firm, and so their lawyers have sent a cease and desist letter against the blogger, despite the fact that there is a clear disclaimer, and there is no way to confuse the two sites:
My guess is that Goldman knows that there are a lot of people out there who have damning information, and they really don’t want a clearing house, but as soon as you send a C&D, you explode the exposure of the site.
Stupid, but intellect is not a requirement for a Wall Street banker. If it were, they would not have f%$#ed up the economy so badly.
Well, we are seeing more signs that China is slowly walking back from its massive investment in the US Dollar, with the world’s most populous nation decreasing its holdings in US securities in January and February of this year.
Of note is the rather Panglossian panic in the tone of this article, which appears to make some fairly epic leaps in order to suggest that this is all really good news for the United States and the US dollar.
If there is really a Chinese pullout of US assets for any extended period, the dollar will fall significantly, and inflation will increase, as the cost of imports, including will increase markedly.
This may not be a rush to the exits, but if it’s a major player in the currency markets tiptoeing towards the door, it’s a much bigger deal than the authors let on.
In any case, it appears that Goldman Sachs will sell about $5 billion in new shares, it’s current market cap is around $60 billion, in order to evade the executive pay limits.
I would argue that this is managers not acting in the best interests of the shareholders, particularly since Warren Buffet’s deal with Goldman is more costly, as they are theoretically required to, but the idea that shareholders actually own a financial firm, and that management works for the shareholders, is apparently for suckers.
In energy, oil fell on projections from the IEA that demand would continue to fall, though this has had little effect on retail gasoline, which is up 10¢ over the past few weeks.
In currency, the dollar is down, in light trading.
So it’s Chol Moed Pesach*, and we had an early morning meeting. About 20 people in the room, and what seems to be a box of donuts for each person, along with soda†, and I can’t have any of it.
Chametz, technically leavened bread, but really anything not certified as kosher for Passover, is forbidden, so I have water, and peel myself an orange.
At another meeting, someone brings in a couple of boxes of left over Easter candy, and I cannot have any of that.
*sigh*
Sometimes, I am seriously Jonesing for leavened bread products right now.
*Not a Yom Tov, in the case of Passover, days 2-5 of the 8 days, so you can work.
†Also not allowed, corn syrup, don’t you know.
The USAF is oirdering an upgraded AGM-65E2, with upgrades to the guidance and control systems.
Though the Air Force denies this, I think that this may be a backstop to the potential cancellation of its intended replacement, the Joint Air-to-Ground Missile (JAGM), which in the current procurement environment may be problematic at best.
It appears that plans for long duration unmanned lighter than air surveillance platforms continue apace, with a subscale demonstrator, the High Altitude Long Endurance Demonstrator (HALE-D), due to fly in August. (paid subscription required)
This aircraft, which relies on solar cells and batteries to maintain station for 2 weeks at 60,000 feet altitude with a 50 lb sensor payload, with successor operational aircraft extending both payload and range significantly, though they would be huge, as this demonstrator is already twice the size of the Goodyear blimp.
Me, I’m dubious of the return of the airship, if just because takeoff and landing are so troublesome in anything but absolutely calm weather.
Rep. Edolphus Towns (D-N.Y.), chairman of the House Oversight and Government Reform Committee, has sent a letter to Treasury Secretary Geithner demanding informanton on any special purpose entities that might be used to avoid executive compensation limits.
As I noted about a week ago, it appears that the Treasury is setting up dummy entities to avoid executive pay limits (scroll down), and now it appears that some of members of Congress are sitting up and beginning to sit up and take notice.
Matthew Yglesias makes a very good point about how we view virtue in our society, specifically that the people at senior levels in the finance giants are not good people.
These are people who are millionaires many times over, and are set for life, and still continue to believe that the only way to induce them to do good is to offer them the opportunity to earn millions more.
In any sane society, this is both evil and insane, as Charlie Sheen’s character so ably noted in the movie Wall Street, “Just how many yachts do you need to water ski behind?”
Now there’s a decent argument out there, familiar from Adam Smith and the whole tradition of economics, that a world full of greedy people isn’t necessarily quite the disaster that pre-modern ethical thinkers would have thought. This is all well and good. True even. But it’s a sign, I think, of a kind of sickness running through American society that we’ve lost the willingness to just say clearly that ceteris paribus [all things being equal] greedy behavior is not virtuous behavior. In the spirit of decency, of course, we recognize that none of us are without sin. It would be crazy to try to condemn everyone who’s ever done anything greedy to the gallows. But the fact still remains that greedy behavior is not admirable behavior and that, as Krugman says, it’s very unlikely that the “best” young people were going into finance. And to say that they’re not necessarily good people need not entail that they’re criminals. Simply the fact that the best people are people who aren’t primarily driven by greed.
(emphasis original)
He’s right. What was presented as a statement of perversion in the movie, “Greed is Good,” by Michael Douglas’ Gordon Gecko character, is now in many places, including, I think, in the minds of Larry Summers and Timothy Geithner, is considered to be a big truth.
These are people who are grossly overpaid, and demand gross overpayment, for jobs that involve far less risk, than those of a policeman, or a fireman, or, at a somewhat smaller pay scale, pro football player.
The idea that their all encompassing greed is a good thing indicates that our society’s values are warped, and possibly broken.
It’s an ad for a “bikini area” shaver, and consists primarily of a song about mowing the lawn.
Great googly moogly….In the history of bad advertisements, this one definitely cracks* the top 20.
*Pun not intended.
This makes 23 so far this year.
New Frontier Bank, Greeley, CO
Cape Fear Bank, Wilmington, NC
Posted via mobile phone.
In this case, it’s Douglas McIntyre of Time Magazine, who looks at a positive quarterly report from Wells Fargo, so he looks at the big sh$&pile, and thinks that there is a pony in there,thus declaring that the banking crisis to be over.
Not unsurprisingly, this ignores the the backdoor bailout through AIG, the fact Wells is deriving profits from a special tax loophole that allows it to write off WaMu’s old losses, that Wells is rather healthy by the standards of the big banks, and the fact that their worthless assets effect solvency, not quarterly profit statements.
Making a quarterly profit is easy for a bank that is not writing down bad loans as it is supposed to.
Posted via mobile phone.
Dave Arneson, who never got the credit he deserved in the creation of Dungeons & Drarons, is dead of cancer at 61.
Posted via mobile phone.
The Air Force Research Laboratory (AFRL) is looking at a winged recoverable booster (paid subscription required) for a rapid response satellite launcher.
Considering the history here, the ruinously expensive and sometimes lethal space shuttle, I’m dubious.
Reusable does not seem to equal cheaper, or more reliable in space boosters.