Month: July 2010

Economics Update

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The obvious lede here is the fact that the Fed has released its Summary of Commentary on Current Economic Conditions, better known as the Beige Book, which was not good, weakening slightly from June’s Beige Book, but it is not downright awful.

This is the already anemic stimulus, and a mild restoration of inventories running out of steam.

If you want some more detail, you can look at the Dallas, Richmond Fed Manufacturing surveys have shown a sluggish economy, and the Chicago Fed National Activity Index has fallen.

We are also seeing that consumer confidence fell to a 6 month low in June.

Additionally real estate is really pretty pathetic, with the number of renters skyrocketing as the home ownership rate has hit an 11 year low, so much for the Bush/Greenspan real estate wealth.

Note that home sales did rise sharply in June, over an expiration-of-the-tax-credit crippled May, but it still was the worst June ever recorded.

Mortgage news was mixed though, with mortgage applications falling slightly, though the number of applications for home purchases rose slightly.

Finally, durable goods orders fell for the 2nd straight month in June.

I Wish That I Could Write Like Matt Taibbi

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He has a post up, The Tea Party is Perverted and Irrelevant, and he notes that the tea-baggers‘ fascination with mythical reverse racism mirrors these sick f%$#s:

Years ago a friend of mine in the media told me a story about an experience he had covering the execution of John Wayne Gacy in Joliet, Illinois. You won’t find anyone in the world who’d have been sad to see serial child murderer in a clown suit like Gacy die, but this reporter friend of mine said the crowd outside the prison on execution night freaked him out almost as much as Gacy had. There were something like 400 people outside the gates at Joliet and there were people selling commemorative t-shirts and pounding beers and chanting (“Kill the Clown!” was a popular one) all night.

At the moment of truth the crowd cheered and my friend turned to interview a scraggly-looking twenty-something with thinning long hair whom he described as looking like a too-old version of the Todd Ianuzzi mean-teenager character in Beavis and Butthead. The guy was into his second six-pack and smiling goofily like he’d just gotten a half-price rub-n-tug from a Thai massage parlor. He says to my friend: “You’re not against capital punishment, are you?”

“I’m not against capital punishment,” my friend says. “I’m against enjoying capital punishment.”

I’m with my friend on this one. As far as I see it, there are three positions on capital punishment. There’s being against it. There’s being for it. Then there’s putting six-packs of beer in a cooler and driving to a hideous prison complex in the middle of the night with four hundred strangers to cheer like fans at a baseball game for the execution of some fat old child killer. Dude, if that’s what you call recreation, you’re either dangerously bored or seriously fucked up.

Taibbi notes that these people really get off on this, though he is rather more optimistic than I am, he sees them as “Basically see are a bunch of middle-aged white people who spent their teens listening to Eddie Murphy albums and deep down are a lot more worried about their credit card debt than they are about ACORN taking over the government,” but I disagree.

I see them as a lost generation, and absent a cataclysm on par with the Axis defeats during WWII, I do not see these people returning to normalcy.

In any case, go and read the whole thing.

Wanker of the Day

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Chris Dodd, who is saying that Elizabeth Warren is not confirmable as head of the Consumer Financial Protection Bureau.

Now that he is not running for reelection, I guess that he’s looking for a lobbying gig with the finance industry:

“She’s qualified, no question about that. The question is whether she’s confirmable,” Dodd added. “The issue is [if] you can’t confirm somebody, if you go six or seven months without someone in that job, you’ve got a problem.”

Progressives have been strongly pressuring the Obama administration to appoint Warren ever since the Wall Street reform bill passed in Congress. Some have argued that she be given a recess appointment if a minority of senators block her confirmation. Dodd objects to that idea.

“I think that would be a huge mistake,” Dodd said, in response to a question from TPMDC. “Recess appointments. No, no, no.”

“I think those are, you know, Republicans used to do it, I think that’s a mistake,” Dodd added. “Except in the most extreme circumstances where you need someone because of an emergency pending, but as a routine matter, I think it’s a fundamental mistake.”

Go Cheney yourself Mr. Distinguished Gentleman from Connecticut.

House Calls Obama Veto Threat on JSF Engine

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The House Appropriations defense subcommittee has voted to fund the F136 alternate engine for the JSF (see also here) which runs full face into the implied threat of an Obama veto (SecDef Gates has said that he would recommend a veto, but that is different from Obama himself threatening a veto).

I’m of mixed emotions on this matter.

I think that the F-35 is over priced, behind schedule, and useless for any likely future war, but I remember the history of Pratt & Whitney’s F-100 before GE started competing with them with their F-110 engine, and it was not pretty, so I think that the engine is a good idea.

I think that the Pentagon is worried that any dollars spent on this will drive up the front end costs, making it more likely that the program will be canceled, and they are willing to eat the additional costs of P&W being the soul source on the back end.

Blue Dog Dem Goes Chicken for MRIs

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Stupid is as stupid does

Ben Chandler of Kentucky spoke approvingly of the days when people paid their doctors with chickens, and a constituent got it on tape.

He voted against the healthcare bill, because he’s a Blue Dog, and he kisses health insurer’s asses.

Obviously, this is not as bad as Sue Lowden’s doubling down on barter for MRIs, he was just being nostalgic, but it’s likely that his Republican opponent will hammer him for it anyway, and I, for one, am glad.

We need fewer faux Dems in the Congress.

Not Enough Bullets

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BP has given their CEO, Tony Hayward, his waking papers.

Only, he gets to stay on until October, at full pay, and he still has his millions in stock options, and in 2 years, he is eligible for a pension of £600,000 a year.

On the brighter side, he is literally being sent to Siberia, as, BP is, “Planning to nominate him as a non-executive director of its Russian joint venture, TNK-BP.”

If you are one of the hyper-rich, you are safe from the consequences of your actions, which is why these f%$#s act the way they do.

If they win, they make a sh%$ load of money, and if they lose, they are still set for life.

One note here, he will be replaced by Bob Dudley, who is an American, which just goes to show that the BP board does not get the USA.

I think that they think that an American CEO will defuse American anger at them.

They are wrong. Americans are suckers for a British accent, we love being conned by people with British accents, just look at the success that lying charlatans like Niall Ferguson, Christopher Hitchens, and Andrew Sullivan have done selling their crap as gold.

The problem here is that something bad happened, and the more people looked at BP, they saw that it is a corrupt criminal psychopathic organization, even by the standards of the oil industry.

The Frothy Mix of Lube and Fecal Matter That Is Sometimes the Byproduct Of Anal Sex ……… *

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Former Pennsylvania Senator† Rick Santorum is looking at running for President in 2012.

Part of me is horrified at the prospect of his insanity and demagoguery polluting the Republican Presidential primary campaign, but another part does not believe that it’s possible for the cesspool known as the Republican Party can get any more polluted, and a third part of me is eager to comment on what is surely to be a first class clown show.
Snark Missile
Time to start stockpiling snark.

*If you don’t understand, you have been living under a rock, but the answer is only a Google away.
†While he lived in Virginia, and had no home in Pennsylvania, which is a neat trick.

News of the Unsurprising

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It turns out that one of the reasons that executive compensation has been skyrocketing lately is that compensation boards game the system to maximize pay for the executives, who, after all, hired them in the first place.

Imagine that.

I would remind everyone that the pot for wages are not infinite: When they get 7 or 8 figure paychecks, it means that everyone else there gets less.

I once figured that Michael Eisner’s compensation at one point in the mid 1990s, $550,000,000.00,* or about $73.45 a second, would have added about $6.00/hour to the pay of every Disney employee, which in turn would likely have saved money through reduced turnover.

It doesn’t matter to them though, they just want to make more than the next CEO.

*For that, he did some rather wooden dialogue with Mickey Mouse on the Wonderful World of Disney. For that kind of money, the mouse should have been able to do him like Marlon Brando did Maria Schneider in Last Tango in Paris.

People Who Should Have Been Drowned at Birth

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Jeffrey Lord, writing, rather unsurprisingly, for The American Spectator, who claims that the lynching of her relative, Bobby Hall, because they beat him to death instead of hanging him.

So, according to the “white cracker inbred former Reagan White House political director” morons out there, it’s only a lynching if it involves rope.

At least ⅓ of lynchings did not involve hangings. They involved burning, shooting, and (Yes, Virginia) beating, among other methods.

Needless to say, as a result of his contemptible and brain dead rants, he is sure to be invited onto the Sunday political talk shows.

Is the Obama Administration Sabotaging the CFPB Already?

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There are increasing reports that Elizabeth Warren, largely as a result of a growing chorus among liberals to appoint her as head of the Consumer Financial Protection Bureau, will be the nominee as the first chair.

Well, I figured that if they were forced, as it appears that they are, then they would play to lose the nomination: After all, how tough is it to get Republicans to filibuster someone who wants to work for the average American?

Well, if the following report is true, then they are also sabotaging the CFPB as an organization as we speak, having tasked a Federal Reserve Governor and former banking industry lobbyist to start staffing the organization:

However, a source tells FDL News that Geithner is working on this process with Elizabeth Duke, a member of the Federal Reserve Board of Governors. Duke is a former community banker and the past head of the American Bankers Association, a trade lobby group. She served on the ABA’s board of directors from 1999 to 2006. The ABA opposed the Dodd-Frank bill almost entirely because of the Consumer Financial Protection Bureau.

What’s more, Duke herself specifically opposed an independent agency in July 2009 testimony, and endorsed keeping the responsibility for consumer protection in the Federal Reserve. In fact, she went further, promoting the Fed’s consumer protection prowess despite the agency having missed the housing bubble and the predatory lending that enabled it.

………

If the reports I’m getting are true, this is the woman dealing with staffing up and organizing the Consumer Financial Protection Agency, before the director gets a chance.

The Federal Reserve has not yet returned comment regarding Elizabeth Duke’s role.

This is crucially important. There’s a lot someone in power can do to mess with a federal agency at the outset. You can hire some staffers not committed to the agency’s goals, or give them poor working conditions, or any number of things. Then the new director comes in and is immediately faced with a turf war. If a community banker dismissive of consumer protections ends up setting the vision for the consumer protection bureau, it could slow its progress out of the gate. If the Department where the agency originates is more concerned with “extend and pretend” – letting the banks get out of trouble by earning their way past the bad loans on their books, in part through inundating consumers with higher fees on their products – then that worldview of the banks being more important than the people can get embedded into the agency.

Obviously, there are conflicting reports here, but I’m inclined to believe these reports.

Obviously, David Dayen’s suggestion that Obama do the right thing and, “without delay name her to the position of interim director by hiring her at Treasury,” is a good suggestion, but this assumes a level of support of the CFPB and its core mission, and I do not believe that.

First, I believe that Obama and his economic team really do buy into neoliberal idea that markets are always smarter and better than regulators, and second, I think that they honestly believe that the banking system will collapse if they generate profits by cheating ordinary Americans.

Of course I’ve been pessimistic about Obama for about three years, so feel free to argue that I’m not hopey changey enough.

About a Lot More Than the iPhone

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The Library of Congress, which has the power to create exemptions to the DMCA, has has made just released very significant carve outs, though to read the New York Times, it’s all about the iPhone.

You see, two of the things that are now allowed under the ruling are software to “jailbreak” the iPhone, both to allow non-Apple™ App Store applications, and to use the iPhone on a non AT&T networks.

Actually, this applies to all cell phones, but this is not a big deal.

What you also have is:

  • The right to rip short videos from DVDs for the educational and criticism purposes.
  • Defeating video game encryption for, “The purpose of good faith testing for, investigating, or correcting security flaws or vulnerabilities”.
  • Circumventing dongles when they become obsolete or exit manufacture.
  • Allowing circumvention of technical measures on E-Books to allow them to be read aloud.

This is stunning. It is consumer friendly, good policy, and common sense.

I would never have expected any of the three things to happen with the US copyright establishment.

I must therefore assume that this was as a result of input from political appointees in the USPTO and Library of Congress, this is fairly radical for career bureaucrats, and as such we need to give the White House credit.

I will note that there is still a work around that Apple™ could use which would make non App Store applications illegal, by using the Sega strategy, which involved using a verification key (the letters S-E-G-A) which would load the banner message, “PRODUCED BY OR UNDER LICENSE FROM SEGA ENTERPRISES LTD,” before the program loaded (thanks for the legal research from DC at SP), which made jail-breaking the console a trademark violation.

I don’t see Apple™ doing this, I think that it would unleash regulatory and customer blow-back, but the legal precedent remains there.

Link to the official anti-circumvention rule-making.