Month: August 2010

Economics Update

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Well, they just revised the 2nd quarter GDP, and it went from an initial reading of 2.4% to a 1.6%, though it should be noted that a lot of this was driven by a surge in imports.

Still, this is not an economy expanding, first the US is one of the few nations on earth that applies hedonic adjustments to GDP, and the rate does not even cover growth in population.

But the banks can meet their bonus payments, and who cares about ordinary people.

Well maybe the people who sell stuff to, or make stuff for, ordinary people might care, because the ordinary people, as reported by the Thomson Reuters/University of Michigan’s Surveys of Consumers, are not in a spending mood:, as consumer sentiment fell again.

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A better recruiting tool Osama never had

It appears that there is a company that carts around decommissioned missiles and jet cockpits to hospitals and the like, in order to amuse the children.

They actually have filed for a patent for their business model, “Business Promotion Via Mobile Interactive Aviation Museum,” yet another indication that our IP system is badly out of whack.

Of course, that’s just one bad patent out of hundreds that are granted every month by the over worked USPTO, which would ordinarily not merit much comment.

What does merit comment is the fact that they are donating dummy missiles for demonstrations that the bigots opposing the 51 Park Islamic center are holding.

Deep Thought

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If you are a, “whacko, my parents are first cousins, X-Files wannabe, black helicopter, tinfoil hat wearing, stupid, dim-witted, thinks pro wrestling is real,” lunatic,* as well as a raving bigot, it’s probably not a good idea to allow yourself to be interviewed by a The Daily Show correspondent:

*Sorry, I think that I just channeled the comedian Denis Leary.

What Barack Obama Wants

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So, after Alan Simpson has repeatedly shown an implacable hostility to Social Security spanning decades, and referred to every person in the us as freeloaders sucking at the tits of society, the Obama administration has decided to double down on this biased nutjob:

But at the White House, Jennifer Psaki, the deputy communications director, said, “Alan Simpson has apologized and while we regret and do not condone his comments, we accept his apology and he will continue to serve.”

The only reason to appoint him in the first place, and the only reason to keep him on after this incident is because Barack Obama wants, and, based on his behavior, what he wants is to gut Social Security.

Economics Update

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It’s jobless Thursday, and initial claims fell back to what seems to be its sweet-spot, 473,000, with the less volatile 4-week moving average rising by 3250 to 486,750, and continuing claims falling by 62,000 to 4.46 million, though emergency claims, which are not counted as continuing, rose by 268,000 to 5.86 million, so we are still seeing a jobless non–recovery, with initial claims about 100,000 more than what would be required for a recovery in the job market.

In real estate, foreclosures fell, but delinquencies rose in the 2nd quarter, which likely indicates that people are still doing worse, but the various moratoria, as well as what Atrios accurately calls the, “Treasury’s predatory lending program,” aka HAMP, is pushing the problem down the road.

Oh, and the Dow is below 10K again, which means nothing in the greater scheme of things.

SEC Gives (some) Shareholders the Right to Run a Slate of Directors

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The 3-2 vote in favor of a rule allowing for shareholder nominations of directors is a good start, but as it exists now, it is very weak tea:

Shareholders won more power on Wednesday to shake up corporate boards in the United States after the financial crisis exposed weaknesses in how companies were managed.

The Securities and Exchange Commission voted 3-2 to adopt a rule that gives shareholders an easier way to nominate company directors.

Activist shareholders who want more say on how companies are run have long sought the ability to place their nominees’ names on company proxy statements.

In theory this is a good reform, but in practice, it is way too restrictive:

Under the rule, shareholders must hold at least 3 percent of the company’s stock for at least three years to nominate directors. Shareholders must hold the stock until the date of the meeting at which director elections are held. Shareholders would be allowed to nominate up to 25 percent of companies’ boards. They would not be allowed to nominate a director if their intent were to take over or change control of the company.

Companies with less than $75 million in market capitalization would get a three-year delay in compliance, to give the SEC time to study implementation in larger companies and make adjustments, if necessary.

3% and 3 years is way to high a hurdle.

At 3% you are talking institutional investors, and probably at a ½ dozen of them to reach the threshold, and then all of them would be required to have held the stock for 3 years.

Not gonna happen, but still, the 2 ‘Phants on the panel are squealing like stuck pigs about this.

Economics Update

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Yep, and the news is not any improvement over yesterday.

New home sales came out today for July, and they hit a 40-year low, and the price of a new home fell to a 7 year low.

When juxtaposed with the fact that , you can see how things get ugly.

And the consumer is continuing to deleverage, which is one reason why consumer credit card debt has fallen to an 8 year low, though part of this is the 2005 bankruptcy laws, which is driving people to default on their mortgages in favor of paying down credit card debt:

Changes to the US bankruptcy code, enacted in 2005, are coming back to haunt banks, according to Yra Harris, a veteran trader at Praxis Trading.

Harris told CNBC that banks lobbied hard for changes to the bankruptcy code, but the legislation is now having the effect of encouraging consumers to do all they can to pay down their credit cards, while leaving their mortgage payments on the backburner.

Karma is a bitch.

In many states, mortgages are non-recourse loans, so once they have the house, they cannot go after the consumer, while in every state, credit card companies can attach wages, etc., so, rather unsurprisingly, consumers are running the numbers and making their choices.

Said consumers are not spending.

I’m beginning to think that absent a 20-40% devaluation in the value of the US dollar, we won’t be out of this mess for a decade or more.

Some Meta on Comments

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I’ve been having intermittent problems with comments not showing up on my “recent comments” widget, and I thought that it was some sort of problem with the hand off between JS-Kit comment system and blogger.

It turns out that it wasn’t.

Blogger introduced an anti-spam system for their comments, basically diverts some comments to the spam folder.

Unfortunately, the filters catch about ½ of the comments, they seem to favor shorter comments.

In any case, I’ve added a tab to my Firefox start with the spam box, so any comment you make should show up in 24 hours, 48 on weekends.

I’m sure that I’ll appreciate the spam filtering once I get enough readers to attract spammers, but right now it’s a pain.

Tom Delay to Be Tried for Corruption in Austin

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He had asked for a change of venue, on the grounds that Austin was “too liberal,”but the judge decided that he could have a fair trial in Travis County, and ruled against moving the trial.

Honestly, thee did not pass the laugh test, but I understand why the defense tried it, it loses them nothing if they lose.

You move a trial when excessive pre-trial publicity taints the jury pool, not because they voted for the other party, and Delay’s corruption got no more coverage in Austin than it did anywhere else.

I’m not sure how this will turn out, but according to the good folks at Talk Left, they are not particularly impressed with Travis County DA (TX law has most corruption prosecutions being conducted by the DA for the Austin area), Donnie Earle, and Delay’s lawyer, Dick DeGuerin, is very good.

Presumption of innocence be damned, this is a man well deserving of a couple of decades of jail time.

Whiskey Tango Foxtrot?!?!?!?

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First, I hear news that some guy flipped out and allegedly stabbed, Ahmed Sharif, a cabbie in New York because the drive was Muslim, and now we discover that this guy worked for a multicultural organization promoting peace and tolerance:

As you’ve seen in our earlier reports, we have what appears to be a straight-up hate crime, in which an NYC cabbie picks up a fare, passenger asks him if he’s Muslim and then stabs him in the neck. The NYPD says Michael Enright, 21, is going to be charged with 2nd degree attempted murder and a hate crime. (See the statement from the victim here.)

Only then things get a little weird. Enright is not who you’d expect. He’s a film student who’d recently been either volunteering for or employed by Intersection International, a multifaith and multicultural effort which seeks to promote justice and peace. And the group has very publicly come out in favor of the Cordoba House project, what opponents call the “Ground Zero Mosque.”

Needless to say, that’s a bit difficult to figure.

This is just freaky, and I just don’t get it, though reports indicate that a significant amount of alcohol was involved.

But if you are talking about this tomorrow, note that the “New York cabbie” has a name, Ahmed Sharif, and remember his name.

Remember That Alan Simpson Was Always Thus, and Obama Picked Him

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So, a few weeks back, Anal Alan Simpson, the co-chair of Barack Obama’s so called “Cat Food Commission,” ostensibly charged with reducing the deficit, but in reality given a mandate to trim Social Security, hence leaving seniors surviving on cat food,* was referring to recipients of the pension program as “Lesser People,” in society.

That was pretty offensive, but Barack Obama knows his way around Washington, and he knows who and what Alan Simpson is, and so I figured that he selected him to co-chair the committee because he wants to cut Social Security.

Today however, I look back at that truly repugnant statement by former Senator Simpson as a high water mark on his civility, because in an email exchange with the president of the Older Woman’s League in which he ridiculed her organization and its membership, and described Social Security as a, “Milk Cow with 310 Million Tits.”

By this, he means that he thinks that every single American who might be eligible for the program is in his mind a moocher.

Of course, we now see the non-apology apology:

I can see that my remarks have caused you anguish, and that was not my intention. I certainly did not intend to diminish your hard work for the Older Women’s League. I know you care deeply about strengthening Social Security, and so do I, just as deeply. I remember your testimony at our public hearing in June about the importance of retirement security for women. Over the last 40 years, I have had my size 15 feet in my mouth a time or two. To quote my old friend and colleague, Senator Lloyd Bentsen, when I make a mistake, “It’s a doozy!”

You see, it’s not his fault, it’s her fault for being offended, and Simpson is just a good old boy who sometimes misspeaks.

You now have a number of advocacy groups calling for his resignation, saying, with a lot of justification, that this shows that Simpson has already pre-decided this matter, while the AARP has indirectly done so as well:

The vast majority of the 310 million Americans he insulted – particularly 156 million women and younger Americans for whom the traditional pension will be a relic of history – don’t have access to the type of traditional pension retirement security that Sen. Simpson has from his decades in Congress. Perhaps that’s why his comments demonstrate a woeful disconnect from or disinterest in the challenges facing many American families for whom Social Security is literally a lifeline.

“Sen. Simpson’s most recent departure from reality would be easy to dismiss if not for his position co-leading a Presidential commission that will likely recommend changes to Social Security. Sen. Simpson’s remarks not only cross the line of good judgment, but they undermine the serious work of the commission and give us little confidence the commission can fairly look at important programs such as Social Security.”

I am not going to join into any dead pool on Simpson. He’s going to stay on the board, because Barack Obama wants him on the board, and given his long history on the social safety net, the only reason that Barack Obama wanted him is because he wants to gut the program.

Expect the deficit commission to propose a few token taxes, no defense cuts, and draconian cuts to programs that help the needy, because that’s how the White House rolls.

*In the interest of health, I would suggest that people eat dog food, and not cat food. Cats because they are one of the few true carnivores, do not need the complex carbohydrates and fats that people, and dogs do. As such, dog food is better for you than cat food because it provides carbs and essential fatty acids. A dog can go blind if it is fed on cat food, but a cat lives just fine on dog food. The phenomenon is known as rabbit starvation.

Appeals Court Denies Federal Reserve Coverup Bid

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Bloomberg filed a freedom of information act request to get information on the Fed’s bailout of banks and other financial institutions about 2 years ago, and true to form, their response to a perfectly reasonable request for information has been delay and litigation.

They lost at the circuit level, and they lost at the appeals court level, and now the appeals court has denied them an en banc rehearing, so unless the Supreme court deigns to hear the case, they are going to have to turn over the information:

The Federal Reserve will have to appeal to the U.S. Supreme Court if it wants to avoid having to disclose details of its emergency lending programs to banks bailed out with taxpayer money during the financial crisis.

The U.S. 2d Circuit Court of Appeals denied the Fed’s motion on Friday to rehear the case in which Bloomberg LP, the parent of Bloomberg News and News Corp’s Fox News Network sought information on the U.S. central bank’s emergency lending programs that began in late 2007.

The programs, designed to shore up the financial markets, more than doubled the Fed’s balance sheet to well over $2 trillion, especially in the wake of the September 2008 collapse of Lehman Brothers.

I am not sure how much of this is just the fetish that the Federal Reserve has for secrecy, and how much is an attempt to cover up behaviors which might be illegal or otherwise appear corrupt.

My guess is that it is a bit of both.

But in either case, absent the Supreme Court taking this up, it appears that we may have some very dull reading of some rather interesting events over the next few months.

Older posts on this are here.

Just how Broken is Our Government?

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Well, how about a lobbying group brazenly using its ability to bribe members of Congress in an attempt to get an industry to target its own customers with onerous positions:

The Recording Industry Association of America said on Monday that current U.S. copyright law is so broken that it “isn’t working” for content creators any longer.

RIAA President Cary Sherman said the 1998 Digital Millennium Copyright Act contains loopholes that allow broadband providers and Web companies to turn a blind eye to customers’ unlawful activities without suffering any legal consequences.

…………

This seems like innocuous whine, the sort that we have heard from the RIAA, the MPAA, the BSA for years, but it’s the threat that caught my eye:

In response to a question from CNET, Sherman said it may be necessary for the U.S. Congress to enact a new law formalizing agreements with intermediaries such as broadband providers, Web hosts, payment processors, and search engines.

The RIAA would strongly prefer informal agreements inked with intermediaries, Sherman said: “We’re working on [discussions with broadband providers], and we’d like to extend that kind of relationship–not just to ISPs, but [also to] search engines, payment processors, advertisers.”

But, Sherman said, “if legislation is an appropriate way to facilitate that kind of cooperation, fine.”

The basic attitude here is that they can ask Congress to jump, and the only response will be the query, “how high?”

It is a revolting state of affairs.

It should be noted that RIAA chief Cary Sherman later “clarified”, saying that, “A broader law enacted without their cooperation isn’t what the RIAA wants,” which really more a restatement of the the threat than anything else.

I hope that attitudes toward IP, and IP absolutism, are changing slowly. It seems to me that they are, largely as a result of the Blackberry case, when a patent troll nearly shut down the Blackberries in the US, in fact RIM’s inability to separate commercial users from government users is in large part why the troll finally settled, they realized that judges deprived of their “Crackberries” can get stroppy.

Shirley Sherrod to USDA: Go Pound Sand

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So the US Department of Agriculture, after unceremoniously firing her on a trumped up controversy, offered a new job, the “Deputy Director Of Advocacy And Outreach,” but she declined the offer.

I’m sure that Ms Sherrod was polite and gentle in her denial, but she is not an idiot, and I think that anyone with this experience with any organization would be inclined to believe that the political appointees of the USDA are a bunch contemptible weasels who cannot be trusted.

Of course, the civil service staff of the USDA were a bunch of contemptible bigots, in the not too distant past, as Ms. Sherrod is no doubt aware, being one of the recipients of proceeds from the Pigford settlement.