He’s loaded for bear.
Not content with a gun, he’s packing an F-15 Eagle.
Some crew chief got just a wee bit silly here.
Year: 2009
Friday Night, “And I Used to Wonder if They Wore Pants,” Blogging
What news anchors do during the ad break.
Another Friday, More Banks Shut Down by the FDIC
Security Savings Bank, Henderson, NV
Heritage Community Bank, Glenwood, IL
16 in about 8 weeks.
Zimbabwe Update
So, now we have a “unity government”, only Mugabe continues to make appointments unilaterally, though Tsvangerai is disputing them, for what that is worth.
In any case, we are seeing an increase in political violence, and government elements allied with the ZANU PF are continuing arrests and detentions of political prisoners, including a “terrorism” charge against senior MDC official Roy Bennett, who is still in detention despite a court order realeasing him on bail.
Seriously, one of the two only good pieces of news coming out of here are reports that Robert Mugabe has bought a $5.7 Million house in Hong Kong, because that might mean that he is preparing to leave.
The other good bit of news is that the new Finance Minister, and Tendai Biti (MDC) is starting to pay some wages in foreign currency.
If Tsvangerai and Biti are smart, they will make sure that the foreign currency goes to organizations that aren’t just a bunch of Mugabe’s thugs.
Unsurprisingly, the seizure of farms is continuing unabated, because it’s about the only currency left for Mugabe to use to buy continued support.
CDOs: How Bad Will It Get
This is why our banks are insolvent. Even without the increases in leverage that have been created over the past 15 or so years, when you see losses like this:
The real shocker, though, is what has happened after those defaults. JPMorgan estimates that $102bn of CDOs has already been liquidated. The average recovery rate for super-senior tranches of debt – or the stuff that was supposed to be so ultra safe that it always carried a triple A tag – has been 32 per cent for the high grade CDOs. With mezzanine CDO’s, though, recovery rates on those AAA assets have been a mere 5 per cent.
Your bank is toast.
That’s 30¢ on the dollar for the best of the best, and just down from that, it’s 5¢ on the dollar.
This is why the big banks are insolvent.
Have I Mentioned that Michael Steele is Really, Really Stupid Lately?
Following Bobby Jindal’s disasterous response to Obama speech, RNC Chairman Michael Steele and promoted him using “Slumdog Millionaire” comparisons.
Mr. Steele, there are worse things than not being “hip”. One of them is pretending to be hip when you don’t get it.
Economics Update
Well, the revised GDP numbers are in for Q4 of 2008, and they are a horror-show, with GDP declining 6.2%, when the initial numbers had been -3.8%.
With numbers like this it’s no wonder that the FDIC is reporting that the banking industry posted an aggregate net loss for a quarter for the first time since 1990.
If we are expecting real estate to rebound any time soon and save us, I wouldn’t hold my breath with condo developers trying auctions to move properties, and And apartment buyers walking away from deposits….Six and seven figure deposits….in Manhattan.
I would also note that the consumer does not appear to be their either, with the finally tally for the Consumer Confidence Index falling to a 29 year low.
With numbers like this, it’s no surprise that S&P is considering downgrading the ratings on $140 billion of prime jumbo mortgage CDOs, and non-prime mortgage origination hit a 17-year low last year.
Real estate, and hence banking, is in a sad enough condition that the FDIC has instituted a temporary emergency rate hike in order to bolster its reserves.
More generally, we have The Institute for Supply Management’s Chicago Purchasers’ Index showing continued contraction. It rose to 34.2 from 33.3, but anything under 50 means contraction, and the 30s are significant contraction.
The fact that GE cut its dividend to 10 cents from 31 cents indicates that no one is doing well here.
The same is going on overseas, with most of eastern Europe in dire straits, getting emergency loans totaling about $31 billion, and Japanese factory output falling, and new jobs drying up.
Jeebus: Over a Month Out of Office, and Bush and His Evil Minions&trade Still Shock Me
So, we know that Dusty Foggo, who was installed by then CIA head Porter Goss, was corrupt, but the court files from his trial are stunning.
He went to jail for taking bribes from Brent Wilkes, who was also bribing Randall “Duke” Cunningham, but we now know that he was alwo sleeping around with his wife with a woman who was also sleeping with a Russian spy, and Porter Goss knew this, and hired him anyway.
Un-dirtyword-believable.
Bailouts for Citi and Other Banks
Let’s start with the numbers: City is currently trading at less than $1.50 a share, but the US government is converting its preferred shares to common stock at a price of $3.25/share, that’s around $12½ billion of taxpayer dollars down the hole.
Between the US Government, and various sovereign wealth funds, it means that existing shareholders have gone from 100% of the bank to 26% of the bank….Let’s be clear about it, they are insolvent, that’s the only reason that the management and the shareholders aren’t screaming bloody murder right now.
This is insane.
Good News on Student Loans
We have some change we can believe in, Obama is calling for an end to federal subsidies to private student loan providers.
Seeing as how the private system has resulted in:
- Higher costs to borrowers.
- Higher costs to the federal government.
- Corruption in the financial aid departments of universities.
It makes a lot of sense to stop subsidizing providers of an inferior service.
Obama would use the money saved for Pell Grants.
Obama Budget Plan
It’s a decent plan, though once again, it appears to not go quite far enough.
- He’s rolling back the Bush tax cuts at the top tax brackets, though I think that the max marginal rate should made far higher, something like the 70% we had pre-Reagan for income above $5 million/year or so.
- He’s spending $634 billion on expanding healthcare access, which is good, but the real need exceeds $1 trillion.
- Closes some of the more egregious tax loopholes.
- Cuts farm aid to big farms
He is also estimating a decent bit of revenue from a carbon cap-and-trade system, which I think is in error. He underestimates the costs of enforcement, speculative pressures, and evasion, which is why I favor a straight carbon tax.
And Now Republicans Come Out in Favor of Giving AIDS to Children
If you ever wondered just how immoral the Talibaptist wing of the Republican party is, look no further than state Senator Dave Schultheis (R-Colorado Springs), who is opposed to testing pregnant women for AIDS, because it would lead to treatments to reduce the chance of their children catching the disease, and their children having AIDS is appropriate punishment for their promiscuity.
The frightening thing is that coming from Colorado Springs, home of James Dobson’s Focus on the Family, a significant portion of his constituents likely agree:
- What he said during the debate: “This stems from sexual promiscuity for the most part and I just can’t go there. We do things continually to remove the consequences of poor behavior, unacceptable behavior, quite frankly. I’m not convinced that part of the role of government should be to protect individuals from the negative consequences of their actions.”
- What he said afterward: “What I’m hoping is that yes, that person may have AIDS, have it seriously as a baby and when they grow up, but the mother will begin to feel guilt as a result of that. The family will see the negative consequences of that promiscuity and it may make a number of people over the coming years … begin to realize that there are negative consequences and maybe they should adjust their behavior. We can’t keep people from being raped. We can’t keep people from shooting each other. We can’t keep people from jumping off bridges. People drink and drive, and they crash and kill people. Poor behavior has its consequences.”
For all those wankers (that’s you Lord Saletan) who think that we can engage in meaningful negotiations with the abortion criminalization crowd, understand that they want to eliminate all forms of birth control, and re-institute criminal penalties for “fornication”.
In fact, they want to give children AIDS to punish their parents.
You can no more find common ground with them than you can with al Qaeda.
The Never Ending Minnesota Elections
Still going on, but I’m tired of this, so just go here for updates.
I think that the judges want to hang Coleman’s lawyers by their tongues from a flagpole.
Is Glenn Beck Stoned?
I’ve never watched him before, but I think that he is wasted here.
NY Times OP/Ed Comes Out for Nationalization Pre-Privatization
I think htat it’s been clear that this is the best solution for some times, but the fact that The New York Times editorial board has endorsed this action, recognizing that there are Zombie banks, even if Ben Bernanke denies this, is significant.
The conventional wisdom is moving, and one hopes that mssrs Bernanke and Geithner will recognize this and act in a prompt manner.
Another Moron
Ben Bernanke, who is saying that there is no such thing as a US Zombie bank:
They all have substantial franchise value. They are all lending — all active. All have substantial international franchises.
Between him and Timothy “Eddie Haskell” Geithner, we are fracking doomed.
Moron
Well, it looks like Benyamin Netanyahu is intends to go full Herbert Hoover on the Israeli economy.
He’s saying that tax cuts are all that Israel needs to fix the economy.
What a bloody tool.
Because the Blue Dogs and the New Democrats are the Suck
It looks like the corporate whore Blue Dog and New Democrat caucuses are doing their level best to kill the ability of bankruptcy judges to rewrite mortgages on primary residences. (Cram-downs)
Chairman of the New Democrat Caucus, Ellen Tauscher, that it’s not fair to people not in bankruptcy who are being screwed by their banks, which is complete bullsh$#.
If people have the stick of cram-downs to wave at the banks, it makes those banks much more likely to renegotiate loans.
What’s more, it only applies to loans already made, not those going forward, and, depending on draft, may only be limited to sub-prime mortgages…..It is very weak tea to begin with.
This is “I want donations from the banks” crap, and Ellen Tauscher is in a very safe Dem district, having won each election with more than 65% of the vote since redistricting.
She needs to be primaried, but according to Act Blue, she does not have a primary opponent right now…..Damn.
John Thain, Ken Lewis, and A Subpoena
Well, it appears that Thain has told investigators that Bank of America CEO Ken Lewis knew of the bonuses that he rushed through just before the merger, but he was prohibited from discussing it any further by BoA, absent a subpoena, so New York Attorney General Cuomo accommodate him, and got a court order.
So now Thain has provided details on all Merrill Lynch bonuses, though this information is still under seal with the court, ostensibly to deal with confidentiality issues.
I understand where Thain is coming from. If he testifies under the compulsion of a subpoena, then he is not liable for anything that he says, he is indemnified, even if would otherwise violate a NDA or other severence package.
It appears, though it is by no means certain, that Lewis, or his agents instructed Thain not to talk, which would appear to be obstruction of justice.
This should get interesting, as Cuomo has subpoenaed Lewis as well, and given that Thain’s testimony is under seal, significant discrepancies might lead to legal problems for him.
But I’m an engineer, not a lawyer, dammit!*
*I LOVE IT when I get to go all Doctor McCoy!!!
What Gail Collins Says
Louisiana has gotten $130 billion in post-Katrina aid. How is it that the stars of the Republican austerity movement come from the states that suck up the most federal money? Taxpayers in New York send way more to Washington than they get back so more can go to places like Alaska and Louisiana. Which is fine, as long as we don’t have to hear their governors bragging about how the folks who elected them want to keep their tax money to themselves. Of course they do! That’s because they’re living off ours.
You go, girl.