Bucket of cold water

While I was always against the idea of privatizing Social Security – I don’t think I’ve ever heard a more chilling summation of the plan than this one from Josh Marshall:

One of the big drives behind Social Security privatization was the desire to find more money -- in the case of Social Security, a lot more money -- to keep the fires burning on Wall Street. Not just more fees for the people handling the money, but more money to keep pushing asset values higher.

And there it is – we want more capital so we can play new and bigger games.

I don’t know why his phrasing hit home more than the other things I’ve read – but that was enough to raise the hairs on my neck.

Thinking of Social Security as just another cash box to raid.

Jesus.

(Oh, and - last year the government sunk the federal pension gurantee fund into the stock market. Just FYI.)

On NASA, state secrets, and killing astronauts...

(Via Bad Astronomy and Spaceflight Now)

...85 seconds after launch, a piece of insulation on the tip of the [space] shuttle's right-side solid-fuel booster broke away and struck [its] right side. The impact was not noted on NASA television at the time and after landing, NASA engineers said that while the shuttle had suffered more tile damage than usual, "it isn't something that's of a major concern."

But as it turned out, the damage was, in fact, extensive. More than 700 heat shield tiles were damaged.

Space Shuttle Columbia, 2003?

No.

Space Shuttle Atlantis, 1988.

Here's Atlantis' commander's take on it at the time (emphasis mine):

"I will never forget, we hung the (robot) arm over the right wing, we panned it to the (damage) location and took a look and I said to myself, 'we are going to die,'" recalled legendary shuttle commander Robert "Hoot" Gibson. "There was so much damage. I looked at that stuff and I said, 'oh, holy smokes, this looks horrible, this looks awful.'"

The 1988 mission was a classified DoD flight - so this never made the papers.

That, I get.

What I don't get is how this information did not inform the morons who sent Columbia's crew to their deaths five thirteen years later.

Late edit: fixed my math. Thanks, thorn!

GM's CEO forced out as part of gov't deal

(Via Bloomberg)

The Obama administration asked Wagoner, 56, to leave the company and he agreed, said an administration official who declined to be identified before the move was announced. The likely replacement, unless the government hires from outside the company, would be Chief Operating Officer Fritz Henderson, said John Casesa, managing partner at New York-based consulting firm Casesa Shapiro Group.

Take whatever rationale is offered for this move:

• Company has no faith in him
  
• Better for the company's future
• Demanded by the baying masses

-and ask yourselves:

Why does the CEO of an industry getting a $30 billion dollar bridge loan get the sack - when CitiGroup's Vikram Pandit still employed? or Bank of America's Ken Lewis?

Ghostnet

The NYT has one of those articles that makes you want to unplug your internet connection:

Vast Spy System Loots Computers in 103 Countries

A vast electronic spying operation has infiltrated computers and has stolen documents from hundreds of government and private offices around the world, including those of the Dalai Lama, Canadian researchers have concluded.

Their sleuthing opened a window into a broader operation that, in less than two years, has infiltrated at least 1,295 computers in 103 countries, including many belonging to embassies, foreign ministries and other government offices, as well as the Dalai Lama’s Tibetan exile centers in India, Brussels, London and New York.

The researchers, who have a record of detecting computer espionage, said they believed that in addition to the spying on the Dalai Lama, the system, which they called GhostNet, was focused on the governments of South Asian and Southeast Asian countries.

Like they say: on the interweb, everyone's your neighbor.

Patch yer 'ware.

Simon sez II

Looks like Simon Johnson is on a mission.

AUL sent me Johnson's article from the Atlantic, The Quiet Coup, where he describes our government's increasing subservience to the financial industry.

I like this bit where he sweeps aside political finger pointing and focuses on the common thread of economic policy in the past few decades (emphasis mine):

Top investment bankers and government officials like to lay the blame for the current crisis on the lowering of U.S. interest rates after the dotcom bust or, even better—in a “buck stops somewhere else” sort of way—on the flow of savings out of China. Some on the right like to complain about Fannie Mae or Freddie Mac, or even about longer-standing efforts to promote broader homeownership. And, of course, it is axiomatic to everyone that the regulators responsible for “safety and soundness” were fast asleep at the wheel.

But these various policies—lightweight regulation, cheap money, the unwritten Chinese-American economic alliance, the promotion of homeownership—had something in common. Even though some are traditionally associated with Democrats and some with Republicans, they all benefited the financial sector. Policy changes that might have forestalled the crisis but would have limited the financial sector’s profits—such as Brooksley Born’s now-famous attempts to regulate credit-default swaps at the Commodity Futures Trading Commission, in 1998—were ignored or swept aside. 

This was beyond conservative or liberal - this was about keeping the money train rolling.

We think we're special - that our crisis is unique - and Simon patiently shows us that the IMF has seen our kind of foolishness before.  And they handled it by making the financial types share in the pain.

Worth a read.

Simon sez

Finally getting around to Simon Johnson & James Kwak's op-ed in the NYT.

Talk about music to my ears. The rationalization for executive bonuses keeps changing.

Point, counterpoint:

• First it was performance. These people brought in the bucks.
  Those bucks were notional. If they want a percentage of what they brought in, I'm sure the American taxpayer would be happy to collect their percentage of the net loss.
  
• Then it was was for retention. Retention awards, see? We don't want these people to leave.
  Why the hell not? These people drove their company and their nation into the ditch. If some other fool company wanted to hire these idiots - we might want to let them.
  Further, many of these people have already left the companies - so paying them to stay seems a mite stupid.
  
• So we moved on to contract law - a defense of the sacred bond of the inviolate business contract. We have to pay them, or our business community will be to afraid to do business.
  Hogwash. Bankruptcy breaks all kinds of contracts, and just because the government didn't want to bankrupt these companies doesn't mean their contracts aren't up for renegotiation.
  
  I mean, what's the difference between the UAW being driven back to the table to alter their pay structure (after all, they are "ruining the auto industry") and Wall Street bankers being forced to alter the terms of their employment when their employer is about to crater?
  
• And then we arrived at necessity. We need these people to un-f%#* the economy. They ruined it, they know how to clean it up.
  I almost bought into this one - there is a certain amount of logic to having these bankers keep their jobs to undo their own handiwork. I sort of envisioned a kind of serfdom, but that would present the risk that these folks wouldn't do their best.
  
  Simon and James enlarge that point and basically say - there's no gurantee these fools will do their best work in any situation:

[AIG] defends the payments by arguing they’re needed to retain employees who are crucial for winding down transactions that are “difficult to understand and manage.” In other words, only the people who stuck the knife into the American International Group can neatly extract it for a decent burial.


There is no reason to believe this.


Similar arguments made during the 1997 Asian financial crisis, when currencies and stock markets collapsed in much of Southeast Asia, turned out to be a smokescreen to protect the executives who were partly responsible for the mess. Recovery from that crisis required Indonesia, South Korea and Thailand to close or consolidate banks. In all three countries, bankers protested, claiming that their connections with borrowers were critical to recovery.


[snip]


The lesson of all this is that when insiders have broken a financial institution, the most direct remedy is to kick them out. Traders are hardly in short supply, and you don’t need to rely on the ones who made the toxic trades in the first place. Companies must always plan around the potential departure of even their star traders, or they are certain to fail. A.I.G. does not need to keep all of its traders, especially since it takes far fewer people to unwind a portfolio than to build it up.

They go on to say that if there really are reasons we need these traders to fix their mess, their employers have to do better than assure us these people are essential. Spell out the particulars - put them in front of independent experts and we'll see if these people still need their jobs.

Ether way, they don't need incentives. In this market, they should be happy to have a job.

Failing that, there's always a subpoena.

The GOP: proving they are the party of ideas

(H/t to TPM)

I know - this is everywhere, but damn is this funny. The GOP was dared to come up with a budget of their own and came up with... a pamphlet.

I watched the media beatdown last night on Rachel Maddow's show and I can't add much to it.

Just read Ezra Klein's article and enjoy the laughs.

My Favorite Budget Ever

...I highly encourage you to spend some quality time with the Republican budget proposal. It's reads like what would happen if The Onion put together a budget. "Area Man Releases Proposal for 2010 Federal Spending Priorities."

I mean - if there was any doubt about the trajectory of the modern Republican party, this should put an end to it.

Their leadership has applied the same train-wreck intuition they've been using - and seem to be the only people who don't notice the carnage.

Get out of the bubble, folks. You're dying.

Hair of the dog that bit them

(Via CJR)

The NY Post reports -

As Treasury Secretary Tim Geithner orchestrated a plan to help the nation's largest banks purge themselves of toxic mortgage assets, Citigroup and Bank of America have been aggressively scooping up those same securities in the secondary market, sources told The Post.

[snip]

Recently, [these securities] have changed hands for roughly 30 cents on the dollar, and most of the buyers have been hedge funds acting opportunistically on a bet that prices will rise over time. However, sources said Citi and BofA have trumped those bids.

In other words - Citi and BofA are outbidding people to buy more of the same toxic assets they have been begging Washington to take off their hands.

I'm sure smarter people than me have a better idea of why this is so - but the simplistic cynic I am - I'm wondering if they expect to be able to sell these new assets (to us) for more than they are currently paying for them.

Does your PC have a hidden master?

Yes, I know the world is concerned with our current meltdown – but Gizmodo’s all agog about about that a looming meltdown in the PC universe– the Conficker worm.

It's lurking in millions of PCs around the world. It's incredibly sophisticated and resilient, with built-in p2p and digital code-signing technology. It revels in killing security software. On April 1, the Conficker worm will activate.

The scariest thing about the Conficker worm is that literally millions of infected Windows PCs could be linked together to do its bidding. The second scariest thing is that no one really knows what its creator is going to do with this virtual army on April 1, when it's scheduled to contact a server for instructions.

While it’s unlikely to bring down western civilization – I’m certainly curious what the authors of this particular mess are planning for April.

Patch your ‘ware, folks.

Power to Truth: You're fired

(Via CJR)

BoA investment strategist Richard Bernstein publicly expressed his belief that people should get out of banking stocks.

He was fired the next day.

I know, no surprise - but sort of a highlighter on what we already knew.

Maximum stupid

A former neighbor of mine once came to my door ragged eyed and looking like somebody who is THIS close to snapping someone's head off. As he was a neighbor I chatted with about once every few months - I could see he was straining to appear normal.

"Do you... have....a few minutes to... help me with something?"

I agreed before he finished his question. Because I could tell he'd been attacked by a Five Minute Job.

I've had my share of these - and the best thing to do is just jump in and not say a thing. By the time a home handyman has gotten to the "ask a neighbor" stage - they are only a few setbacks away from "paint your body blue and climb on the roof with a deer rifle."

The Five Minute Job is a project that shows all the signs of getting done in five minutes, yet somehow ends up consuming an entire day, the contents of your wallet, and any dignity you'd tucked away for safe keeping.

The FMJ has two main phases: a prolonged series of false summits followed by a moment of truth.

A lot of the agony the FMJ dishes out has to do with the victim mistaking the former for the latter. It is the the Spanish prisoner of home repair - just a  little farther... now a little farther...okay, farther still...

But this is all theory. Let's take a case study, shall we?

I'd already mentioned that a filthy car had given me the idea to address some long deferred maintenance. Change the oil, replace the windshield wipers.

Changing the oil was simple enough - I'd planned on getting this done with some recall work at the dealer, but booking an appointment requires lead time and could involve waiting a week. Heck with that. Besides, dealers cost more, right?

I do one of those drive in, drive out places and get 'er done over lunchtime. These places upsell so hard, I resist the $20 air filter they want to sell me, certain I can do better with NAPA.

Done. I decide to pick up wipers and air filter at the nearest store. The nearest store only has wipers. I buy a new pair for $34 - or rather, I buy two different wipers since my car takes two different sizes. It's spendy, but certainly cheaper than what the dealer would charge.

The second store has filters - and here's where things start to go off track. I do not recall the exact conversation with the store clerk. Since I have this thing where I remember my car as the year I bought it - 2005, rather than the car's actual year - I'm going to bet I asked for an air filter based on the year of purchase.

In any event, I was given an air filter for the wrong year.

As the following events will show, betting that this was my mistake is not so much a bet as it is a sound investment strategy.

To begin establishing this fact, I'm going to point out that I did not take the time to compare the size of the filter I bought with the memory of air filter the oil change guys took out and showed me. The actual filter? about 8 inches square. The one I bought? 16" by 8".

On the way home, I decide to fill up the tank at my favorite gyro shop/gas station. I pull in at the outermost pump, and hook up.

I notice it won't let me pick regular gas. Okay. Oddly enough it won't let me pick premium or super-duper hype gas, either. Odder.

All I can get is this fourth option with a sign next to it that says:

May contain up to 10% ethanol.

Okay, like I care - so I hit the button and start pumping gas. The 10% gas is priced higher than regular, but it won't be a full tank and the alternative is to move the car to another pump because this pump is apparently out of everything else.

Squeeze, lock. Zone out.

At about $12 bucks in - I see another sign above the gas button I selected.

Contains 85% Ethanol.

I begin zoning back in. Which is it? 85% or 10%? I look at the 85% sign again.

Now I'm at $15 bucks of this stuff. I look off to the holster where pulled the gas nozzle from. Above that is another sign:

I look at the pump - This sign is over the nozzle, not a specific fuel type - so does it apply to all four buttons?

I'm at $16 now.

I stop the pump. I'm at the leftmost edge of this pump. If I walk towards the right edge, I can now see another pump. This pump apparently allows me to pick from the other three types of gas.

The pump that just dispensed $16 bucks worth of fuel into my car - that one only pumps out E-85.

*Light bulb noise*

I have just put 7.65 gallons of E-85 into a non-flex fuel vehicle. My vehicle.

I need assistance. The clerk (who knows me well enough to place my usual gyro order when I walk in) is absolutely no help. "It is corrosive, but you should be able to drive."

Great. He does give me this bit of information: "This happens a lot."

No kidding.

I drive home. Rapid-fire internet searching tells me that this is probably not a major tragedy, but I should burn through this tank in a hurry and keep adding good gas as soon as I can - to dilute it.

Oh, and I should change my oil after it's all gone.

Good thing I changed my oil three hours ago.

So oil change - done and then undone. False summit.

On to act two: the air filter. I find out what I already told you - I have the wrong filter. Another false summit.

Act three: the wiper blades. Wiper blades are the classic FMJ. I have a mental model of what I've done for other cars. My old Nissan, changing the blades took ten seconds. Squeeze lever, remove. Squeeze lever, replace. Done.

This is what I'm expecting. My car's wipers are massive, and have no levers. There's a piece that looks like it comes off - but does not. Okay, okay - I'll RTFM. I read the manual and discover that wiper changing is not the clip in clip out with my particular car. The manual says I am supposed to take the rubber wiper off the blade assembly I just bought and slide it into the blade assembly that is part of my car.

By wiper, I mean a two foot long piece of rubber spaghetti, flanked by two long, separate (and extremely thin) strips of metal.

Now the manual says:

Slide the new wiper into the blade assembly.

It's a manual - it's not supposed to editorialize, but it would have helped me immeasurably for it to have added a single sentence after that.

Namely:

This will be practically impossible.

Picture pushing rubber spaghetti into a two foot long slot while keeping grooves on either side of it aligned with sets of tabs every inch or so.

Oh, and being a wiper blade - the slot curves to ensure the most friction possible. You cannot push a string, and pushing a rubber string (even one flanked with metal strips) is not much better.

I spend an obscene amount of time getting the shorter, passenger side blade inserted into its blade assembly using needlenose pliers, the aforementioned metal strips, and an unending stream of profanity.

One down - the short one. I double down and take the driver's side blade off, and begin again.

After about two inches, this blade simply stops. Dead. Using the needlenose pliers gives me 30 seconds of frustration followed by tearing six inches of the wiper blade in half.

As in: $17 down the crapper - and my car no longer has a wiper on the driver's side. And it's raining. And it will be tomorrow, too.

F(*^# this. I go to bed.

Day two of the Five Minute Job. I've reassessed the situation and decided there is no way in hell I'm going to buy a new blade and roll the dice again. I tear another $17 wiper, I'm going to start looking for blue body paint.

So I decide to suck it up and call the dealer. They will have the full blade assembly, with the factory-installed wiper, radiant in its perfection. It will cost an terrifying amount of money - but I have stopped caring.

The parts guy at the dealer tells me it costs $7.

*Electrical short*

Um, are we talking about the wiper blade, or the full assembly?

"Oh, just the wiper. You'll need to slide it into -"

I tried that with the last wiper I bought. Can I buy the whole-

"They are pretty tough, but if you come in, we'll do it for you - for free."

*Choirs of angels*

I'll be right there.

Seven-fricking-dollars - including installation. I'm such an idiot.

I take the all the wreckage from the $17 blade I bought - wiper, metal strips, assembly - and chuck it all in the garbage. Screw you.

I get both kids into the van, grab the stripped-down driver side blade assembly, and rocket over to the dealership.

[Observant readers will know what is about to happen - for the rest of you, enjoy the suspense.]

My boy loves the dealership - last time he got popcorn and got to play in their fully stocked playroom. I pull in and the boy immediately notices there is no popcorn machine. He is upset. Little E is also upset, she's sick and didn't want to leave the house.

I'm on a mission. I will have wipers, whatever the cost.

At the parts counter, I recognize the voice of the guy I talked to. I'm the wiper guy, I say and plunk down the blade assembly. I'm expecting he'll spend a great deal of time connecting my assembly with a wiper while me and the kids hit the playroom.

Instead, I've barely turned around when parts guy comes back with my assembly and a floppy-looking wiper blade.

Too late, I get it.

"Do you have the metal strips that go with this assembly?"

I spend a second picturing the metal birds-nest in my kitchen garbage. It speaks to me: Screw you, right back.

I tell them I left them at home since (at least in my head) when you buy a wiper, you buy the metal strips that sit inside it and are essential to its installation.

Parts guy assures me that wipers are sold without metal strips - so I tell him I'll be back in thirty minutes. No way in hell am I trying to install these myself. $7 wipers or not, I would fail.

I pile the kids back in the van. Neither are happy - both want the playroom. We'll get it after we come back doesn't seem to do much. I'm still on my mission, though.

I go home, leave them in the car and run to the garbage can. At this point, I've thrown out six metal strips, two from the passenger side wiper and four from the driver side. The driver's side ones are longer, and one is bent beyond all hope. I find the remaining pair and peel out in the van.

Back at the dealership. Before, they weren't busy - now, they are swarming with cars with appointments. I have no appointment - I'm just buying a $7 wiper.

The kids are on the verge of full blown freak out. It's lunchtime, neither has eaten. Both want to run around a room stocked with pirouetting cars. Dad is not in patient mode.

Parts guy. Me again, here are those metal strips. I try to grin. I'm batting a thousand today. Parts guy grins. He's trying not to pity me. I don't care. We're headed to the playroom.

"Uh, sir?"

No.

I turn around. Parts guy is holding my metal strips as one might hold a dead rat.

"These, uh....these are too short."

Now - at this point in the FMJ - after so many false summits - I believe I've finally arrived at the moment of truth.

This is not a happy realization because a moment of truth is merely the point at which you either triumph over adversity - or plummet to your death. I have no illusions about which option I'm headed for.

These are the ones I got off the car - these are the only ones I could bring you. What do I do now?

Parts guy thinks for a moment. Looks up my vehicle's VIN to make sure I haven't given him the wrong year/make/model. Incredibly, I haven't.

"Sir? How about I just sell you a full blade assembly with wiper at cost?"

There goes the choir of angels again. I want to hug this man. Instead, I ask him if they have an air filter for my car. They do. I buy it without noticing the cost.

Moment of truth: triumph over adversity. At a car dealership, no less.

I go home and clip in the new (and complete) blade assembly.

It takes ten seconds.

Basketball homecoming

Nothing wears off faster than a vacation.

This past weekend was the basketball weekend (a three to four day man-fest of sports, vulgarity, and red meat), and it lived up to its reputation of being a sort of out of body experience. Go where you want, eat where you want, say what you want – all the things that parenthood denies you. G was our host and supplied the venue – his man-cave has been upgraded to a level that is downright civilized – and we supplied the sloth.

We ended the last night by eating our weight in roasted dead animals – and then watching Jack Nicholson terrorize Boston and DiCaprio on G’s massive TV.

Mobsters, headshots and food-induced comas… ah paradise.

The suspension of reality can only last so long, and the simple act of driving home is enough to bring it  crashing back down on top of you.

I'd been late arriving at G's house, and it was suggested that I use my still-warm car to drive everyone out to brunch and burgers.

Seemed like a good idea until I realized that I still had two kid seats in the back and I hadn't cleaned the car in (oh, I don't know) a decade.

G and B gamely piled into the back and sat on a half-inch deep layer of Cheerios and muffin crumbs.

It being the basketball weekend, this nominated me as official whipping boy anytime we started talking about cars.

Fair enough, but on the way home, I'd already planned a response. The two car  seats had been taken out and were just piled in a heap in the back. As long as they're out, and the weather cooperates, I'd just clean  out the car when I got home.

Hit the ground running, I'm thinking. Half hour out of town, I'm remembering that I still need to change the oil (by the helpful nag-meter telling me EXACTLY how many miles over my oil life I currently am.) and my wipers need replacing.

Three things I can get right on. Clean the car, buy some wipers, change the oil.

At home, I start off on cleaning the car - the boy's dying to help out. His version of "clean the car" entails using his favorite outdoor tool: the garden hose. No harm in letting him try, he can spray water all over it if he wants - so I'm like okay.

The boy's reminding me that the hose doesn't work - and I remember that'd I'd shut off the water line to the outside faucet a month ago. For pretty much the same reason - we had a warm spell and the boy wanted to use the hose.

Funny, I don't remember draining the line afterwards... ah, no biggie.

I duck down into the basement and open the valve to the outside tap-

-and immediately hear the rushing, splattering sound of water jetting out of something.

It takes about a half second to register.

What's that about..? That's louder than it usually is...

I turn the valve off - the sound stops. Unconsciously, I open the valve again - some part of my brain wants to see if it happens again. It does.


Oh sh!t.

I close the valve and start heading upstairs to see if the water is spraying out of the (non-weatherized) faucet that passes for a spigot. On the way there, I hear dripping water in my finished basement room.

Water is dripping from a half dozen places in the drop ceiling - and three of them are directly over a loaded bookshelf.

Double sh!t

The drop ceiling is stapled in place and I can't find a putty knife because (OF COURSE) I left them wherever I last used them last. I grab a carpenter's square and start punching holes in the ceiling. E's freaking out about the books and I ask her to let the water out of the hose upstairs. The valve to the outside line is working, so only the water between the valve and the outside spigot is what we have to worry about. We let out what we can, we might save on some hassle.

E goes up and tells me no water is coming out of the hose. Great.

We bring buckets, towels and eventually manage to save the books with only eight or nine ceiling tiles torn down and perhaps three of them irrevocably damaged.

The boy's mad. He won't get to use the hose.

I'm positively seething. I'd left some water in the pipe and forgot to drain the pipe - so the last cold snap probably did that. Nice.

So, no hose on the front of the house - and I'll need to replace the ceiling in the basement.

I've been home for less than an hour.

Still - this problem will not worsen (I think) so I get back to the orignal plan of cleaning out the car. The boy's majorly gung ho - so this gets done really fast. Less than an hour, I have a clean car.

That leaves two more things to do. Wipers and the oil change.

Skip it, I'll do them tomorrow.

Cordesman's Jerry McGuire moment

(Via DoD Buzz)

CSIS’s Anthony Cordesman gave a speech yesterday at the National Defense University where he blasted the defense culture that has produced what he called “the worst run department in our history.” He emailed the speech around and I’d thought I’d reproduce a few of the choicer bits. He said the current “crisis” facing all the services’ procurement and force structure plans, where “we are killing force structure to try to buy new weapons,” is a failure of leadership, not of process.

Cancer detection rates vs survival rates

Because I'm in love with the efficient representation of data,

Here's a great graphic from Wired:

It's too easy to draw simple conclusions from this, but it's still a very illuminating picture.

Waltz with Bashir

Speaking of things I found in Wired, here's a movie trailer that pretty much pushes all my "go-see-this" buttons.

Here's the text lead in:

One night at a bar, an old friend tells director Ari about a recurring nightmare in which he is chased by 26 vicious dogs. Every night the same number of beasts. The two men conclude that there is a connection between the dream and their Israeli Army mission in the first Lebanon War of the early eighties. Ari is surprised he can’t remember a thing anymore about that period of his life. Intrigued by this riddle, he decides to meet and interview old friends and comrades around the world.

Persepolis from an Israeli veteran.

Totally on my list.

Taibbi's Howard Beale moment

(H/t to AUL)

Rolling Stone's Matt Taibbi vents his spleen and gives us a marvelous and profanity-laden summary of what has happened up until now.

It's over — we're officially, royally fucked. no empire can survive being rendered a permanent laughingstock, which is what happened as of a few weeks ago, when the buffoons who have been running things in this country finally went one step too far. It happened when Treasury Secretary Timothy Geithner was forced to admit that he was once again going to have to stuff billions of taxpayer dollars into a dying insurance giant called AIG, itself a profound symbol of our national decline — a corporation that got rich insuring the concrete and steel of American industry in the country's heyday, only to destroy itself chasing phantom fortunes at the Wall Street card tables, like a dissolute nobleman gambling away the family estate in the waning days of the British Empire.

 But it's so much more than a rant- and is chock full of some very illuminating details - like:

In the biggest joke of all, [AIGFP's CDS wizard Joe] Cassano's wheeling and dealing was regulated by the Office of Thrift Supervision, an agency that would prove to be defiantly uninterested in keeping watch over his operations. ... Under another law passed in 1999, certain kinds of holding companies could choose the OTS as their regulator, provided they owned one or more thrifts (better known as savings-and-loans). Because the OTS was viewed as more compliant than the Fed or the Securities and Exchange Commission, companies rushed to reclassify themselves as thrifts. In 1999, AIG purchased a thrift in Delaware and managed to get approval for OTS regulation of its entire operation.

[snip]

That same year, as the subprime crisis was exploding, the Government Accountability Office criticized the OTS, noting a "disparity between the size of the agency and the diverse firms it oversees." Among other things, the GAO report noted that the entire OTS had only one insurance specialist on staff — and this despite the fact that it was the primary regulator for the world's largest insurer!

It won't make you happy, but if you haven't read much up until now - it's a good way to ramp up and get to the proper level of pissed off.

Executive pay

(via Ryan Chittum)

The WSJ provides a nice guided tour of executive pay in 2008, stopping along the way to point out CEO’s who received big bonuses despite terrible performances.

And there are some great related articles as well:

Leonhardt vs Sorkin: Outside the bubble - also from Chittum

Today’s tax code makes no distinction between income above $373,000 and income above, say, $5 million. Both are taxed at 35 percent.

This is almost verboten in the acceptable business press (and the political press, too, for that matter), but it’s a debate that we need to have. There are no good ways for the government to cap pay, it seems to me. The only way to regulate that is on the back end, through taxation. Should John Paulson, who made $3.7 billion in a single year, have to pay a higher tax rate than the doctor who makes $300,000?

You tell me.

And these:

The Journal Outside the Bubble.


Top-exec pay train runs full steam ahead

The Mommy Wars: can we stop talking about the edge case?

CJR nets a good one from Judith Warner

Warner goes off on the new batch of stories talking about reversals to the so-called trend of opting-out ("rich, educated, non-working moms who set the tone of the talk about motherhood in the boom years").

We — journalists and readers both — simply must, for once, resist the temptation to let what may or may not be happening to the top 5 percent (or 1 percent) of our country’s families set the story line for what women’s lives are becoming in this recession.

Because, the fact is, the story’s not about them.

Whether the appeal of those stories stems from class bias, ease of access, or the tidy lines that can be drawn around the protagonists - they need to stop.

You want to talk about how the economy is affecting the fabric of home life? Try writing about people who are really feeling the crush.

The Conficker Cabal

K sent me this article from the NYT

An extraordinary behind-the-scenes struggle is taking place between computer security groups around the world and the brazen author of a malicious software program called Conficker.

Conficker is malicious code that generates what is called a botnet - a diverse collection of corrupted computers that can receive remote instructions from their new masters.

This is not new. Botnets have been sending email spam for years.

One of the largest botnets tracked last year consisted of 1.5 million infected computers that were being used to automate the breaking of “captchas,” the squiggly letter tests that are used to force applicants for Web services to prove they are human.

The inability of the world’s best computer security technologists to gain the upper hand against anonymous but determined cybercriminals is viewed by a growing number of those involved in the fight as evidence of a fundamental security weakness in the global network.

The scope of the problem posed by Conficker is big enough to get IT professionals to band together to stop it. That they've had little success so far is a bit unsettling:

Several people who have analyzed various versions of the program said Conficker’s authors were obviously monitoring the efforts to restrict the malicious program and had repeatedly demonstrated that their skills were at the leading edge of computer technology.

For example, the Conficker worm already had been through several versions when the alliance of computer security experts seized control of 250 Internet domain names the system was planning to use to forward instructions to millions of infected computers.

Shortly thereafter, in the first week of March, the fourth known version of the program, Conficker C, expanded the number of the sites it could use to 50,000. That step made it virtually impossible to stop the Conficker authors from communicating with their botnet.

[snip]

The researchers, noting that the Conficker authors were using the most advanced computer security techniques, said the original version of the program contained a recent security feature developed by an M.I.T. computer scientist, Ron Rivest, that had been made public only weeks before. And when a revision was issued by Dr. Rivest’s group to correct a flaw, the Conficker authors revised their program to add the correction.

Read the whole thing.

Geithner's mea culpa: WTF?

(H/t to Emptywheel)

Okay, so Sec. Geithner is telling people that it was his department that asked Sen. Dodd to insert a loophole into the stimulus bill that allowed AIG employees to keep their bonuses.

Okay, let's reconcile that with this

Geithner said he learned the full scale of the bonus problems on March 10.

[snip]

Congress last month passed the $787 billion stimulus bill that President Obama signed into law.

The bill had included a measure from Dodd to limit executive bonuses. But slipped inside at the last minute was an exemption for bonuses agreed to "on or before February 11, 2009." That allowed AIG to go ahead with its controversial extra pay.

For days, no one would say who was responsible for the loophole that let that happen.

On Tuesday, Dodd denied that he had anything to do with adding the language.

"When I left the Senate, it was not in there. So when I wrote the language, there was no such language like that," he said then.

But, saying his previous comments had been misconstrued, Dodd said Wednesday that he added the exemption after getting pressure from the Treasury Department.

"I agreed reluctantly," Dodd said. "I was changing the amendment because others were insistent."

Um, that'd be the Treasury department asking for the loophole last month, and a Treasury Secretary claiming he found about about it eight days ago.

So.... who the hell in the department is making this request and why aren't they being forced to explain themselves? And why the hell is Geithner unaware such a request was being made by his subordinates?

I'd love to see this item chased down until the responsible parties are cowering under the cameras.

Late edit: Glennzilla's all over this one including this bit:

Here is the hierarchy of positions regarding executive compensation limits back in February:

* Chris Dodd -- advocated full-scale, no-exceptions limits on executive compensation for bailed-out companies

* Obama administration -- supported limits but advocated exceptions for already-existing employment contracts

* GOP leaders -- opposed all executive compensation limits as Socialist tyranny

Yet everything is exactly backwards in this controversy.

The Obama administration has been trying to blame Dodd for the carve-out that allowed the AIG bonus payments, a carve-out that came into being because Geithner/Summers demanded it and because they opposed the limits Dodd wanted as too onerous. And now, the GOP -- which opposed limits of any kind -- wants to blame the Obama administration and Dodd because the limits weren't stringent enough to stop the AIG bonus payments. And the media is playing along perfectly, having clearly decided that the person who led the way in fighting for absolute compensation limits -- Dodd -- is the real villain responsible for the AIG bonuses.

[snip]

You can't spend six months frightening people by warning them that they're headed into a Great Depression and then be surprised when they're "outraged" that hundreds of millions of dollars in taxpayer money are being shoveled into the pockets of those who helped bring the situation about. The belief that nobody cares -- which does seem to be the overriding administration view -- is possible only if one thinks that the way the financial industry functions is perfectly fine and normal and doesn't need any changing. That belief, more than anything else, seems to define Tim Geithner, and it appears to be the primary source of most of the problems that are now, quite justifiably, plaguing him.

Seriously... WTF??

I have infiltrated this blog

I am so dead for doing this.

This is the infamous C who "re-arrainged" Murph's kitchen and also changed his answering machine.  I will never be allowed in his house again.  But this is totally worth it.

That said, here is the picture of the day:

Is there a health care bubble?

(H/t E)

Brian Klepper and David C. Kibbe over at Health Care Policy and Marketplace Review have a marvelous post about the current state of the health care industry and the forces shaping its future.

Here's a sample:

One of us recently had a 3.5 hour diagnostic procedure at a local hospital outpatient surgery center. The EOB (Explanation of Benefits) from the health plan showed the hospital had submitted a facility charge of just over $13,000 - more than four months of total income for one-third of American households - and the health plan paid approximately $1,300, which means that willing vendors and purchasers agreed that the procedure's market value was 10% of the charge.

But without insurance, we would have been legally responsible for that bill, with the willingness to negotiate utterly at the discretion of the health system.

I'm sure we all have had moments of incredulity when we view what our medical procedures "cost" on our bill. The fact that I don't have to pay the outrageous sums of money printed on my statement makes them somebody else's problem. But they are still a problem.

Here's the follow up:

1. Is it appropriate to add a 1,000% surcharge for the sin of uninsurance. For not-for-profit health systems especially, is it appropriate to do so while receiving a tax break for providing community service?

2. When a provider chooses to pursue a receivable figure that is more than the established market value (as determined through the contractual figure with the health plan), can that effort properly be understood as inflating the market?

3. Can a system maintain stability when it inflates value beyond the means of most of its purchasers ?

The definition of a market bubble is a high variance between the intrinsic value of a product and its market valuation. Bubbles always burst eventually, as inflated market values tumble back towards intrinsic value. We're seeing this with homes and banking stocks. Are we there yet with health care services? Could America's health system collapse?

All good questions - not like we don't have problems enough, but you have to wonder about all those inflated prices that have been cruising around in the health care industry.

What will happen if (say) a massive financial crisis were to put pressure on insurers and governments  who have been paying these inflated bills all this time?

A British media smackdown

(Via Bad Astronomy)

Here's a great bit from a London Doctor discussing the media's flawed coverage of the vaccination issue. He broadens it to include the flaws of media coverage of health in general (something that would absolutely apply on this side of the pond).

Take a look, it's marvelous.


I'm curious how this got put together. If this was just him and his editing software and some friends (you can do a lot with a few people these days). Good on London Tonight for putting it on the air.

Imagine the discussion we could have with informed members of the public are allowed to voice their opinions on issues in a nationally televised format....

It would be like.... what's the word I'm looking for....Journalism??

No, that's not it. It'll come to me...

Emptywheel's perfectly good question

Emptywheel posted something that would make a perfectly good question for our Treasury Department (preferably in an open hearing - televised in prime time).

I'm paraphrasing here, but here it goes:

How is it that the US government can force car companies to cut the wages of line workers, the US government cannot force bankers to cut the wages of the thugs who broke the global financial system?

Well...?

Jim Cramer on market manipulation: It's a pretty good game

(Via AUL)
Naked Capitalism has a great post called Traders behaving badly which nicely illustrates a system that kills minnows and rewards sharks.

That analogy does double duty - it applies to the market at large, and the culture within a firm.

Yves Smith spells out what happens when a trader crosses a line to bring home the big bucks:

...this type of chicanery gets perilous little notice. Why? Because management is complicit, either by commission or omission. The poster boy of "commission" was Joe Jett, the Kidder Peabody so called rogue trader who in fact never lost the firm a dime, but reported huge phantom profits due to a flaw in Kidder's reporting system. I won't bore you with details, but there is good reason to believe that Jett thought the profits were real, that he did not think he was perpetrating a fraud.

However, anyone with an operating brain cell, and particularly his bosses, should have questioned the idea that it was possible to make such monster profits in the Treasury market, Even if Jett had miraculously discovered some anomaly, it should have been arbitraged away, pronto.

So what happened? Jett was barred from the securities industry, and forced to disgorge his bonuses (I am going from memory, but I believe they were about $8 million). And what happened to his boss, Ed Cerullo, who made $20 million thanks to Jett? Nada.

That's why this crap continues.

Not much to add there, other than this crap needs to stop.

The bonus from this post is the link to Slate's article by Henry Blodget, Cramer vs Cramer.

Blodget goes through Jim Cramer's interview with Wall Street Confidential and susses out all the potential SEC violations Cramer is sorta-kinda admitting to having committed.

Jon Stewart thrashing of Jim Cramer will get a lot of play, but Blodget makes it seem that Stewart was positively benign compared to what he could have done.

Consider this Cramer quote (from the same interview):

    The great thing about the market is it has nothing to do with the actual stocks. Now, maybe two weeks from now, the buyers will come to their senses and realize that everything that they heard was a lie, but then again, Fannie Mae lied about their earnings for $6 billion, so there's just fiction and fiction and fiction.

    I think it's important for people to recognize that the way that the market really works is to have that nexus of: Hit the brokerage houses with a series of orders that can push [the stock] down, then leak it to the press, and then get it on CNBC—that's also very important. And then you have a kind of a vicious cycle down. It's a pretty good game.

I'll just quote Blodget here and refer you to the full post. It rocks.

What are the implications of the clip? Well, first, Cramer is once again giving terrible advice. How? By advising investors to engage in practices that might be considered illegal. Cramer appears to say it's OK to orchestrate prices ("it's important to foment …"). "The SEC doesn't understand," so you won't get caught. Even if this were true, and even if the only consideration were risk/reward, this would be bad advice.

Second, Cramer is implicitly undermining everything he says on his CNBC show. The whole conceit of Mad Money is that small investors can compete with the Big Boys of Wall Street. Well, if this is really the way the Big Boys play the trading game, how can that possibly be true? Is Cramer just implying (but not saying) on Mad Money that small investors should break laws?

Read the whole thang

This just in: we torture

(Via WaPo)

Cripes, whatever happened to the Friday news dump?

The news is just raining sh!t today...

Red Cross Described 'Torture' at CIA Jails
Secret Report Implies That U.S. Violated International Law

The International Committee of the Red Cross concluded in a secret report that the Bush administration's treatment of al-Qaeda captives "constituted torture," a finding that strongly implied that CIA interrogation methods violated international law, according to newly published excerpts from the long-concealed 2007 document. 

The report, an account alleging physical and psychological brutality inside CIA "black site" prisons, also states that some U.S. practices amounted to "cruel, inhuman or degrading treatment." Such maltreatment of detainees is expressly prohibited by the Geneva Conventions.

[snip]

Often using the detainee's own words, the report offers a harrowing view of conditions at the secret prisons, where prisoners were told they were being taken "to the verge of death and back," according to one excerpt.

 Okay, the allegation is not new but an ICRC report getting to the public is a bit of a deal.

This means the US government was advised in 2007 that the ICRC thought we were committing torture.

Kinda makes us look bad. Kinda makes former VP Cheney look like an idiot.

AIG's finally fesses up

Yes, AIG has been taking our money and funneling it to big Wall Street firms.

I know, no surprise there - but they've spilled a small measure of their guts. I guess giving out bonuses on our dime AND not telling us who they were protecting was just too much. I'd love to hear the after action report on what made this come out in the open.

AIG Lists Firms It Paid With Taxpayer Money - NYT

Oh, Surprise! the créme de la créme of Wall Street, Goldman Sachs, is among the top of AIG's payouts. It's good to have connections at Treasury, no? These were the guys who said that Goldman's exposure to AIG was immaterial.

Huh, that's a funny way to describe $12.9 billion dollars.

The new wrinkle is the fact that our money is headed overseas via AIG. England, France and Germany are getting $32 billion from the Fed.

Don't look now, but I think we're about to become a very angry nation.

Also, I wonder what assurances we have that this is a complete disclosure of how much these firms have received from AIG since they started receiving federal funds?

Late edit: CJR posts on who helped this disclosure happen.

It's all in the headline

Let's say there was a story about how the very same AIG executives who ruined their company and cost taxpayers hundreds of billions of dollars were still going to receive millions in bonuses.

If you were writing the headline, what would you write?

If you were the NYT, you'd go with: A.I.G. Planning Huge Bonuses After $170 Billion Bailout

Reserved, yet snarky.

Here's WaPo: Bailout King AIG Still to Pay Millions In Bonuses

Little more snark - without sacrificing accuracy.

CBS News: After Rescue, Bonuses Still Flow At AIG

Casual, but they don't spare the rod.

And then there's the AP:  Insurance giant AIG agrees to restructure bonuses

WTH?

Way to completely miss the boat there. I know the AP is supposed to be dispassionate, but c'mon the meat of this story is not "AIG is going to look at how it will structure bonuses in the future" but "AIG is still shelling out cash to the total losers who drove their company (and the economy) off a cliff."

Oh, well at least they're not the Atlantic's Conor Clarke: Are AIG's bonuses really so bad?

Here's his attempt at logic:

Once you get above a certain dollar figure -- $10 million dollars is my psychological threshold -- it ceases to be an amount of money that you can think about in tangible terms (fitting into  a sleek black briefcase, say) and becomes an abstraction. But you can't make good policy with abstractions. The most you can make is awkward conversation.

I'm sure he's right. Big numbers are too hard to think about. Smaller, easier numbers are readily available in the sports pages.

Leave the big numbers to the smart people. They've never steered us wrong.

Google Mars

Looks like I need to update my copy of Google Earth again...

Google Earth updates maps of Mars

Oh how I love Google Earth...

Jon Stewart vs. Jim Cramer CNBC

First, if you have not watched Jim Cramer being interviewed on The Daily Show, please do so now.

I'll wait.

Okay.

You have to love CNBC's miscalculation. After the initial pummeling their network received, they attempted the classic full court press. Cramer's on Scarborough, The Today Show - hell, public access TV - acting all hurt and misunderstood.

You can practically track their counter-memes streaking across America:

1. This is a "war" between Jon Stewart and Jim Cramer
2. Jon Stewart is mean
3. Jon Stewart cannot be taken seriously

By agreeing to appear on The Daily Show, we are supposed to believe a fourth meme:

4. Jim Cramer is being big about this

Somewhere in the bowels of CNBC - I picture a number of eager faced PR folks turning to their sets to watch the fruits of their labor. They're looking for a few yuks, some good-natured ribbing and a "thanks for coming on the show."

Holy crap, were they wrong.

Stewart exposing Cramer as a hypocrite using videotape was merely an appetizer. Stewart tears into Cramer not because he's Jim Cramer, but because he's a representative sample of CNBC's business news.

That'd be the business news that not only managed to not cover the lead up to our current financial meltdown, but went out of their way to be Wall Street's bullsh!t bullhorn for the past few years.

Stewart's opening line after the first commercial break sums up the whole interview.

Stewart: Let me tell you why I think this whole thing has caused some attention. It's the gap between uh what CNBC advertises itself as, and what it is.

And right there the CNBC PR folks turn to each other and start mouthing expletives.

Cramer tries all his charm, tries to act all Gosh, I made some bad calls, but at least I admit it - and Stewart doesn't bite.

Cramer lies to Stewart's face about not short selling. Then Stewart responds with tape of Cramer bragging about how he did short sell, how he encouraged everyone to do it, and basically asserting how manly he was for admitting it- but that he would never say it on TV.

....and cut to the Jim Cramer who has just seen that clip air on TV.

There's so much in there:

• Cramer in the studio making like every investor's defender: "I've been trying to rein in short selling, trying to expose what really happens..."
• Cramer in the clip trying to ingratiate himself with the financial crowd: I'm one of you, see? I play the same games you do.
• Cramer caught in a lie.
• Cramer realizing he's been caught; and
• Stewart's killer follow-up:

Stewart: I want the Jim Cramer on CNBC to protect me from [the Jim Cramer in that clip]

It's an absolutely devastating moment. And you have to set it aside to get to the heart of the matter.

This is the beatdown so many CEOs never faced on CNBC in the years leading up to our current mess.

Screw Cramer. Cramer is merely CNBC's messenger boy. They sent him out because they thought they could make this about him, use his appeal to deflect our attention from the key point Stewart was making.

CNBC chose to be cheerleaders instead of journalists - and they'd rather you not focus on that.

I give no credit whatsoever to Cramer showing up. This was an attempt to continue the spin. I'm a good sport, see? Stewart took his scalp anyway and shot it back at the people who sent him.

I have no idea why it takes a satirist to expose ineptitude in financial news coverage, but the Daily Show just schooled an entire network.

A-freaking-men.

Late edit: added the link

Peter Schiff as Cassandra

Oh man. I know there are a lot of financial gurus out there with egg on their face, but this clip of Peter Schiff vs Fox financial punditry is just painful:



You wonder if these people can stand to watch themselves.

(H/t CJR)

Jakob Nielsen vs. Kindle 2

Usability guru and world-class quibbler goes after the Kindle2 with his latest newsletter.

His take:

11 years ago, I wrote that electronic books were a bad idea. Has Kindle 2 changed my mind?

Yes.

The two factors that convinced me were (a) equal-to-print readability and (b) multi-device integration.

It's no rave review, to be sure - but he points out some definite advances as well as avenues for print killing functionality.

Books aren't going to die, but its becoming increasingly likely our grandkids will think of books as another way to read.

At least we're not Iceland...

VF paints a dismal picture of the recent goings on in Iceland

Iceland’s de facto bankruptcy—its currency (the krona) is kaput, its debt is 850 percent of G.D.P., its people are hoarding food and cash and blowing up their new Range Rovers for the insurance—resulted from a stunning collective madness.

[snip]

When their three brand-new global-size banks collapsed, last October, Iceland’s 300,000 citizens found that they bore some kind of responsibility for $100 billion of banking losses—which works out to roughly $330,000 for every Icelandic man, woman, and child. On top of that they had tens of billions of dollars in personal losses from their own bizarre private foreign-currency speculations, and even more from the 85 percent collapse in the Icelandic stock market.

(H/t cool blog)

Microsoftt's killer UI

Yes, it's purely hypothetical - but it's pretty darn cool (~5 min):




The i started something blog has a second video that does a more serene tour - where you follow a entrepreneur who sells/develops green roofs.


Neat stuff all round.
(H/t to BD and i started something)

Everything's amazing and nobody's happy

(H/t to BB)

Comedian Louis CK goes off on the problems of modern life:

Maiden Lane LLC: Untangling AIG

...Oh we're nowhere near understanding how screwed up AIG is, but TPM has a fascinating post about how the Fed is dodging regulations to funnel cash to failing companies like AIG.

According to TPM's source, the Fed (which is prohibited from buying assets) is creating bogus corporations who then invest in dying companies. Here's the deal they did for Bear Stearns, using a shell company called Maiden Lane LLC (named after the address of the Manhattan Fed):

The deal then was JP Morgan put $1 billion into Maiden Lane, the Fed put $29 billion in cash into it. Maiden Lane paid Bear Stearns $30 billion, which went straight back to JP Morgan as this deal happened simultaneously to JP's purchase of Bear. So Morgan got $30 billion in cash ($29 billion net) and the Fed got stuck owning the crap, but was legally only making a loan to Maiden Lane, who was the legal owner (Maiden Lane was incorporated not in NYC, but in Delaware to avoid paying taxes).

The law is avoided - but essentially the Fed is giving money to JP Morgan so they can buy Bear.

Hooray for the rule of law.

The Daily Show vs. CNBC/Santelli: not even close

Oh my God.

If you haven't seen the Daily Show crucify CNBC and Rick Santelli in their March 4th episode - do so ASAP.




Santelli was the scheduled guest, but backed out. In his place was NYT reporter Joe "AIG-bane" Nocera.

The first ten minutes are flat out brilliant - and are a perfect segue into the Nocera interview.

Here's a sample (emphasis in original):

Stewart: How does a guy like Rick Santelli have the balls to get mad about this idea of giving homeowners a break - when this network - CNBC - how do they miss this entire storm?

They're a financial news network. I mean it'd be like the Weather Channel interviewing hurricane Katrina and saying Y'know there are reports that you have high winds and flooding and Katrina's like No, no, no, I'm sunny and they're like alright.

This is insane!

30 minutes of hell-yeah television.

Beer pong is safe

(H/t CJR)

Just in case you were watching The Colbert Report, or Fox & Friends lately - No, beer pong cannot give you herpes.

The study they quoted was a hoax.

This from the CDC:

Alleged CDC Beer Pong/Herpes Simplex study is a HOAX
Recent news stories about an alleged CDC study showing a possible link between the drinking game, Beer Pong, and herpes simplex 1, the virus that causes cold sores, are false. The Centers for Disease Control and Prevention did not publish the referenced article. For more information please contact CDC's Division of Media Relations at 404-639-3286.

The Colbert Report is satire, but FOX claims to be news. Owch.

Bets on who issues the first retraction?

The two AIG's

Barry goes off on the AIG situation - and does a wonderful job of explaining how the AIG we have, is very different from the AIG we'd heard of.

When AIG first faltered, there were two companies jammed under one roof. One was a highly regulated, state supervised, life insurance company. In fact, the biggest such firm in the world.
The other firm was an unregulated structured finance firm, specializing in credit default swaps and other derivatives.

The first firm was Triple AAA rated. They had a long history of steady growth, profitability, excellent management. They made money (as the commercial goes) the old fashioned way: They earned it.

[snip]


The other part of the firm was none of the above. It was neither regulated nor transparent. It existed only in the shadow banking world, a nether region of speculation, and of big derivative bets. This part of the company engaged in the most speculative of trading with hedge funds, banks, rank speculators, gamblers from around the world. Huge derivative bets were placed, with billions of dollars riding on the outcome. ...

This part of AIG was nothing more than a giant structured finance hedge fund.

The price of an idle thought

I wonder if I could…?

Hmmm….

1. Start with a Google search
2. Scan result 1
3. Open Tab 2 to result 2
4. Scan result 2 - useless
5. Open tab 3 to Tivo.com
6. Search for Tivo Desktop
7. 3 minutes to download TiVo Desktop
8. 5 minutes to install
9. – windows crash-
10. 8 minutes to reboot
11. 5 minutes to install TiVo Desktop
12. 2 minutes to launch TiVo Desktop
13. 3 minutes to load full list of programs
14. 28 minutes to import 1 hour program from 2/27/2009 to my PC
15. 1 minute to download Direct Show Dump
16. 15 minutes to convert program's .tivo file to an open MPEG file
17. Launch Windows Movie Maker
18. Import program into Windows Movie Maker
19. -program crash-
20. Launch Windows Movie Maker
21. Import program into Windows Movie Maker
22. -program crash-
23. Launch JetAudio
24. 5 minutes to locate controls to set conversion range
25. 10 minutes to convert file
    1. Set begin time to 49:03
    2. Set end time to 49:33
    3. Select file output to MP3
    4. Convert
    5. Play file
    6. Discover that trial version of software records intervals ~20 seconds later than the settings on the UI
    7. Set begin time to 48:38
    8. Set end time to 49:08
    9. Convert
    10. Play file – success!
26. 5 minutes to locate 12-in-1 flash card reader & Micro SD card
27. 2 minutes to find MicroSD adapter
28. Plug MicroSD card into 12-in-1 flash card reader
29. Copy MP3 file to MicroSD card
30. Plug MicroSD card into cell phone
31. Reboot phone
32. Access file list – select file
33. File size exceeds acceptable limit.
34. Repeat steps 25g-25j three times to create 30 second file below 300KB (Bitrate 80Kbps)
35. Repeat steps 28-32
36. Success!
37. Use land line to dial cell
38. Success!

Two hours of my life, two software installations, and this post -
- but I have BSG's piano version of All Along The Watchtower as a ringtone.
 
Fly the geek flag high!!!

Allen Stanford, Renaissance man

Allen Stanford's "business" is now being referred to as a Ponzi scheme - but who is the man behind the Ponzi?

Actually, just the kind of dirtbag you'd expect.

Jets! Bonuses! Outside wives!

Outside wives?

Yep.


(H/t Portfolio.com)

Hitting them where they live

(Via The Long War Journal)

Pakistani terrorists assault Sri Lankan cricket team in Lahore

A terrorist assault team attacked a bus carrying the Sri Lankan cricket team in the eastern city of Lahore in Pakistan's Punjab province.

The "well-trained terrorists" killed five policemen and two civilians, and wounded seven Sri Lankan cricketers before melting away and 11 security and rescue personnel. Two of the Sri Lankans " received serious bullet injuries" while the head coach received minor injuries, the Associated Press of Pakistan reported.

This might get filed under news of the weird, but the terrorists know what they are doing:

The fallout from today's attack was swift. In a major blow to Pakistan, the International Cricket Council has banned Pakistan from hosting international games until the security situation changes "dramatically."

"In the current situation it is clearly a very dangerous place," David Morgan, president of the International Cricket Council, told reporters today. "Things will have to change dramatically in Pakistan in my opinion if any of the games are to be staged there. I think that international cricket in Pakistan is out of the question until there is a very significant change, a regime change I guess."

Pakistan is a world power in Cricket, and this is a major blow to their prestige. Too dangerous to host THE event.

It's like losing the Olympics, or outsourcing the Superbowl.

Score one for the bad guys.

Men of zeal...without understanding

The revelations of secret DOJ opinions justifying executive omnipotence is the clearest example of what the previous administration was about: the aggregation of power.

There is nothing conservative about ignoring the 4th amendment.
There is nothing democratic about ignoring Posse Comitatus.
There is nothing constitutional about secret law.

These memos were written in service to the ideology of power.

You can do this, Mr. President, because you asked your loyal servants if you could.

...we think that the better view is that the Fourth Amendment does not apply to domestic military operations designed to deter and prevent further terrorist attacks.

Just think on that for a second. Ponder the limitless action justified by such a statement.

Any political party that doesn't immediately denounce such apostasy isn't worthy of participating in government.

(H/t to Glenn)

Regulators on IndyMac: left hand vs. right hand

Yes, I know - AIG is eating billions like popcorn, but here's a nice example of Bush-era banking regulation, back when tens of millions of dollars was considered a lot of money.

When the hell was that?

Back when IndyMac was merely an unknown lender sliding towards oblivion.
It seemed federal regulators had different opinions of what to do.

IndyMac exposed the rift between the [Office of Thrift Supervision] and the FDIC when the OTS allowed the savings and loan to take extraordinary measures to stay afloat, and then failed to level with the FDIC about what it had done. The bank's failure cost the FDIC fund $10.7 billion.

Last spring, an OTS supervisor permitted IndyMac to count $18 million it received in May toward its regulatory filing for March. The money allowed IndyMac to claim it had a sufficient capital cushion and didn't need special permission from the FDIC to continue business as usual. Without that accounting sleight of hand, the bank would have fallen below the well-capitalized minimum threshold, triggering a ban on certain kinds of deposits absent an FDIC waiver. As a result, IndyMac earned a few more months of life before failing in July, a delay that cost both the FDIC and uninsured depositors tens of millions of dollars.

Here's the juvenile bit: The director of the OTS is telling the incoming Treasury Secretary they worked with FDIC, when they hadn't.

...ProPublica has learned that the OTS did not volunteer information about the $18 million. The FDIC learned of its existence only after it asked the OTS why IndyMac hadn't finished its financial filings for March. Even then, the OTS didn't disclose that the $18 million wasn't available in March, according to the FDIC. The FDIC discovered the truth after IndyMac failed and it took over the bank.

OTS is in a pissing match with the FDIC, props up a failing lender, and doesn't bother to tell its fellow regulators.

Quality.

(H/t ProPublica)

Car seat ratings: Epic Fail

It wasn't so long ago, Consumer Reports retracted their ratings on child safety seats. CR explained that their test simulated side impacts of 70 MPH, rather than the 30MPH they'd intended.

Bad test - bad results. While any seat was better than no seat, parents had to wait months to get the verdict on their seats.

I remember being ticked off, since I'd already bought my daughter's chair based on their recommendations.

That feeling can't really compare to the visceral reaction I have to this:

That'd be the chair I bought. It's the Britax Companion - one of the most expensive seats on the market - simulating a 35 MPH impact with a wall.

Here's the bonus round:

The NTSB carried out the tests, but never publicized the results.

Look, there's a limitation to the test that's one thing - but kid seats start smashing into seat backs, you'd think there would be some follow up.

The Trib adds this nice tidbit about the safety test applied to all child safety seats (emphasis added):

Before being sold, seats must pass a test simulating a head-on crash at 30 m.p.h. on a sled bench. In the tests analyzed by the Tribune, regulators crashed actual vehicles into a wall at 35 m.p.h.

Claybrook said the crash tests suggest something that is common sense: Car seats can be judged more thoroughly when evaluated inside a real car as it is crashed.

The Tribune found, for instance, that many of the higher injury ratings occurred when the baby dummy's head hit the rear of the vehicles' front seats. The sled tests wouldn't pick up this potential injury because there's no front seat to hit, so regulators are considering adding one.

In the meantime, we have products that are good at surviving test conditions, and not much else.

(H/t ProPublica)

Think a happy thought

...and watch this little factoid devour it whole.

The projected US deficit for this year is larger than the GDP of almost every other nation on earth. Only nine nation's GDPs exceed our 2009 deficit - and we're one of them.

Owch.

(Via The Big Picture)

Frak! Three more episodes to go...

Just in case I'm not the only one to have a moment of clarity once the chorus kicked in...

Spoiler alert: If you haven't seen BSG: Someone To Watch Over Me, come no further.... (and stay out of the comments)

For those that have, or don't give a damn, hit CTRL-A.

Scroll down....

Daniel is totally her dad.

Artistic temperament...?

Went away, never came back...?

Which means she's one of them, eh? Something new...?

Gotta give it up for the writers. They've just ensured that song will course through the veins of another generation.

Oooh, what fun!!