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)
Thursday, March 12, 2009
Monday, March 09, 2009
Jakob Nielsen vs. Kindle 2
Usability guru and world-class quibbler goes after the Kindle2 with his latest newsletter.
His take:
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.
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.
Sunday, March 08, 2009
At least we're not Iceland...
VF paints a dismal picture of the recent goings on in Iceland
(H/t cool blog)
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)
Friday, March 06, 2009
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)
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)
Thursday, March 05, 2009
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):
Hooray for the rule of law.
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.
Wednesday, March 04, 2009
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):
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?30 minutes of hell-yeah television.
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!
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:
The Colbert Report is satire, but FOX claims to be news. Owch.
Bets on who issues the first retraction?
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.
Tuesday, March 03, 2009
The price of an idle thought
I wonder if I could…?
Hmmm….
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!!!
Hmmm….
- Start with a Google search
- Scan result 1
- Open Tab 2 to result 2
- Scan result 2 - useless
- Open tab 3 to Tivo.com
- Search for Tivo Desktop
- 3 minutes to download TiVo Desktop
- 5 minutes to install
- – windows crash-
- 8 minutes to reboot
- 5 minutes to install TiVo Desktop
- 2 minutes to launch TiVo Desktop
- 3 minutes to load full list of programs
- 28 minutes to import 1 hour program from 2/27/2009 to my PC
- 1 minute to download Direct Show Dump
- 15 minutes to convert program's .tivo file to an open MPEG file
- Launch Windows Movie Maker
- Import program into Windows Movie Maker
- -program crash-
- Launch Windows Movie Maker
- Import program into Windows Movie Maker
- -program crash-
- Launch JetAudio
- 5 minutes to locate controls to set conversion range
- 10 minutes to convert file
- Set begin time to 49:03
- Set end time to 49:33
- Select file output to MP3
- Convert
- Play file
- Discover that trial version of software records intervals ~20 seconds later than the settings on the UI
- Set begin time to 48:38
- Set end time to 49:08
- Convert
- Play file – success!
- 5 minutes to locate 12-in-1 flash card reader & Micro SD card
- 2 minutes to find MicroSD adapter
- Plug MicroSD card into 12-in-1 flash card reader
- Copy MP3 file to MicroSD card
- Plug MicroSD card into cell phone
- Reboot phone
- Access file list – select file
- File size exceeds acceptable limit.
- Repeat steps 25g-25j three times to create 30 second file below 300KB (Bitrate 80Kbps)
- Repeat steps 28-32
- Success!
- Use land line to dial cell
- 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)
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)
It's like losing the Olympics, or outsourcing the Superbowl.
Score one for the bad guys.
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.This might get filed under news of the weird, but the terrorists know what they are doing:
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.
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."Pakistan is a world power in Cricket, and this is a major blow to their prestige. Too dangerous to host THE event.
"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."
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.
Any political party that doesn't immediately denounce such apostasy isn't worthy of participating in government.
(H/t to Glenn)
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.
Quality.
(H/t ProPublica)
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.Here's the juvenile bit: The director of the OTS is telling the incoming Treasury Secretary they worked with FDIC, when they hadn't.
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.
...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)
Monday, March 02, 2009
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):
(H/t ProPublica)
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.In the meantime, we have products that are good at surviving test conditions, and not much else.
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.
(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)
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)
Sunday, March 01, 2009
Frak! Three more episodes to go...
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!!
AIG: Dispenser of AAA holy water, lynchpin of our meltdown
(Via TPM )
Joe Nocera paints a very scary picture of what AIG has been doing, and what they mean to the larger financial meltdown.
It's an appropriately infuriating read, but it will help you understand why the taxpayer has every right to know what the hell is on AIG's books.
They're holding an alarming number of the credit default swaps that have the world's banks shaking in fear.
Every one that blows up, costs AIG billions of dollars they don't have.
And the government's writing them regular checks to keep them alive.
Joe Nocera paints a very scary picture of what AIG has been doing, and what they mean to the larger financial meltdown.
It's an appropriately infuriating read, but it will help you understand why the taxpayer has every right to know what the hell is on AIG's books.
They're holding an alarming number of the credit default swaps that have the world's banks shaking in fear.
Every one that blows up, costs AIG billions of dollars they don't have.
And the government's writing them regular checks to keep them alive.
FISA: Yowza!
Judge Walker rules against the govt in part of the ongoing al-Haramain case.
Basically, Judge Walker has asked to review the wiretap log that pertains to the case - and the government had asserted that the state secrets rule barred him from doing so.
The Judge Begs to differ, and on Monday we will see how the next round of this mess proceeds.
Emptywheel posts that the government will appeal, but not before they suddenly remember:
Translation, some of the earlier stuff we gave you is wrong. We'll send you updated information via classified channels.
Or - The stuff is wrong - and we'll send you the correct information when you litigate it out of us (i.e. over our dead bodies).
I'm sure I don't have enough information to know what the hell is going on, but I'm sure going to keep following this.
Props to Emptywheel, she who informs my ranting...
Basically, Judge Walker has asked to review the wiretap log that pertains to the case - and the government had asserted that the state secrets rule barred him from doing so.
The Judge Begs to differ, and on Monday we will see how the next round of this mess proceeds.
Emptywheel posts that the government will appeal, but not before they suddenly remember:
The Government’s ex parte, in camera classified submissions also address an inaccuracy contained in a prior submission by the Government, the details of which involve classified information that cannot be set forth on the public record.
Translation, some of the earlier stuff we gave you is wrong. We'll send you updated information via classified channels.
Or - The stuff is wrong - and we'll send you the correct information when you litigate it out of us (i.e. over our dead bodies).
I'm sure I don't have enough information to know what the hell is going on, but I'm sure going to keep following this.
Props to Emptywheel, she who informs my ranting...
Saturday, February 28, 2009
Women & children Bankers & Traders first!
What's up with health care?
(Via CJR's Trudy Lieberman)
(Via CJR's Trudy Lieberman)
The most cogent assessment, however, came from Susan Dentzer, former health correspondent for The NewsHour with Jim Lehrer and current editor-in-chief of the policy journal Health Affairs.
So what’s actually being put forward here is a plan to spend some money, starting a couple of years from now, to begin to cover some of the uninsured. And that’s really the reality that has been created by the current fiscal situation we’re in.In other words, the uninsured may have to wait.
Friday, February 27, 2009
Save the world
Cracked.com pokes a stick in the eye of all things save-the-planet related.
I'd go so far as say I'd share their skepticism of most of them.
Anti-Vaccinatio, Anti-bac soap? - totally with that. Recycling and carbon offsets, I'd say the jury's still out. There are countless specific examples of how both are done now that are inefficient and just plain wasteful.
(I'm reminded of a community in the UK, where the local recycle program ended up dumping everything they collected into the landfill.)
My dad was big on kicking such programs when they were down - but the current state of them isn't the ultimate state of them. What is labor intensive now may not be so with a few years of innovation.
Organic food? That's a tough one. I'm all for eating food that isn't bathed in chemical baths and flown from around the world. The organic movement has its charlatans and hucksters, but it not as if agribusiness is without sin. I really do question if we can feed everybody with organic produce - but I simiarly doubt that our current faith in speciallized, chemically-dependent high-yield crops isn't due for a catostrophic realization.
Cracked's just trying to tick people off - but I wonder where the current state of the science is on these.
(H/t to Bad Astronomy)
5 Ways People Are Trying to Save the World (That Don't Work)
(Some NSFW text and ads)
#5. Buying Organically Grown Food
#4. Rejecting Vaccinations
#3. Recycling
#2. Using Antibacterial Soap
#1. Buying Carbon Offsets
I'd go so far as say I'd share their skepticism of most of them.
Anti-Vaccinatio, Anti-bac soap? - totally with that. Recycling and carbon offsets, I'd say the jury's still out. There are countless specific examples of how both are done now that are inefficient and just plain wasteful.
(I'm reminded of a community in the UK, where the local recycle program ended up dumping everything they collected into the landfill.)
My dad was big on kicking such programs when they were down - but the current state of them isn't the ultimate state of them. What is labor intensive now may not be so with a few years of innovation.
Organic food? That's a tough one. I'm all for eating food that isn't bathed in chemical baths and flown from around the world. The organic movement has its charlatans and hucksters, but it not as if agribusiness is without sin. I really do question if we can feed everybody with organic produce - but I simiarly doubt that our current faith in speciallized, chemically-dependent high-yield crops isn't due for a catostrophic realization.
Cracked's just trying to tick people off - but I wonder where the current state of the science is on these.
(H/t to Bad Astronomy)
Foggo's dossier
Now that ex-number-three-at-CIA Dusty Foggo's is getting three years in prison, a number of fascinating details about him are coming to light.
The killer was the quote at the end of this piece. It's mid 2004, and the CIA is considering Foggo for the CIA exec job. Foggo's long list of misdeeds were known to the CIA. Questionable conduct, security risks, and outright lies are overlooked - and why?
Apparently, the CIA's tea leaves are as effective at predicting elections as they are for finding WMD.
(H/t Danger Room)
The killer was the quote at the end of this piece. It's mid 2004, and the CIA is considering Foggo for the CIA exec job. Foggo's long list of misdeeds were known to the CIA. Questionable conduct, security risks, and outright lies are overlooked - and why?
[CIA DIrector Porter Goss'] team also thought it wouldn't matter much whom they picked, since Sen. John Kerry, D-Mass., the Democrats' presidential candidate, was "certain" to win the election and they would all soon be gone.Oh, if only, man... if only.
Apparently, the CIA's tea leaves are as effective at predicting elections as they are for finding WMD.
(H/t Danger Room)
Obama's tax policy
I so totally love this post on FiveThirtyEight.com:
Shorter version: Yes, overpaid mouthpieces of the White House Press Corps: your taxes will be going up. Exactly as promised. Stop your pouting. No one likes you.
Shorter version: Yes, overpaid mouthpieces of the White House Press Corps: your taxes will be going up. Exactly as promised. Stop your pouting. No one likes you.
Sh!tiGroup
Barry asks the question I'm dying to know the answer to:
ARRRGH!
To review: Former Treasury Secretary Hank Paulson made a terrible investment on behalf of the taxpayers by purchasing a 7.8% stake in Citigroup (C) for an initial $25 billion dollars. He further put the US on the hook by guaranteeing against 90% of future losses on $301 billion in assets. Subsequently, we (the taxpayers) injected another $20 billion dollars.Can somebody explain to me why this option is the best choice?
At the time, Citigroup had a market cap of about ~$50 billion dollars. Today, its worth ~$13 billion.
So for about 100% of the market value of Citi, plus insurance guarantees worth of as much as 500% of its value (~$275 billion), we got less than 1/10 of a company that in total was worth 1/5 of our investment.
Pretty good deal, eh?
That $45 billion dollar stake now has a market value of just over a billion.
And, its about to get even worse.
ARRRGH!
Bloomberg's Mark Pittman: Ignorance was bliss, prepare to be horrified
CJR's The Audit talks to Mark Pittman and there's just no end of good info.
Pittman goes after his own industry, the business press:
Bloomberg is currently suing the Fed to reveal the details of the collateral the Fed got in exchange for loans made to AIG and others:
Pittman goes after his own industry, the business press:
MP: ...Most reporters, it’s shocking how few of them actually understand the difference between price and yield. Hardly any business journalist actually covers the financing. If you cover a company and all of a sudden their borrowing costs go from 100 (basis points) over to 250 or 300 over [meaning investors believe the risk has increased substantially], and no one asks a question. There’s a problem there when that happens and nobody asks a question. I think we have training issues in a huge way in our profession. We brought a knife to a gunfight.And then he shows you what you've been missing.
Bloomberg is currently suing the Fed to reveal the details of the collateral the Fed got in exchange for loans made to AIG and others:
MP: But a lot of [the assets] have gone to the Fed, though, as collateral for loans. They’re still on their balance sheet, but you borrowed against them. We don’t know if those are cracked CDO’s or prime RMBS…
TA: That’s what you guys are suing (the Federal Reserve) for—to find out what the collateral is.
MP: Yeah, and that’s the secret part of the story that nobody wants to let you know.
TA: Because it’s worth pennies on the dollar or dimes on the dollar.
Very illuminating
MP: Yeah, and then everybody’s going to go “Oh my God, we’re lending ninety cents on something that’s worth twenty or thirty?”
TA: They say they don’t want to disclose it because it would interfere with the markets, is that right?
MP: Their basic argument is this would cause chaos, and they’re probably right. But that doesn’t mean that the American taxpayer ought to be on the hook for this.
TA: Why would it cause chaos?
MP: Because people would realize that we’re lending eighty cents on the dollar for something that’s worth twenty cents.
TA: So political chaos?
MP: And maybe market chaos, too.
Seven deadly URLs, Vol. I
Envy - LEGO employees get the best business cards
Gluttony - Pizza vending machines. Seriously.
Greed - Government's convertible stock plan another name for giveaway
Lust - Sen. Vitter may face porn star in Lousiana primary.
Pride - George Will stands behind his laughable column on climate change
Sloth - Baconnaise, For people who want to get heart disease but [are], you know, too lazy to actually make bacon
Wrath - Online tee-shirt vendor offered a discount to anyone who could prove they were convicted of wife beating.
Gluttony - Pizza vending machines. Seriously.
Greed - Government's convertible stock plan another name for giveaway
Lust - Sen. Vitter may face porn star in Lousiana primary.
Pride - George Will stands behind his laughable column on climate change
Sloth - Baconnaise, For people who want to get heart disease but [are], you know, too lazy to actually make bacon
Wrath - Online tee-shirt vendor offered a discount to anyone who could prove they were convicted of wife beating.
Thursday, February 26, 2009
Do not press an enemy that is cornered
This from Market Movers:
So, the question is - what do you do to the banks to keep them from burning down their own houses out of desperation?
Or do you just seize them before they start being stupid?
Dave Wrixon has the simplest explanation yet of the latest iteration of the Treasury's bank bailout plan:To me, that sounds good. But I don't have a Ph.d. like this guy, Felix Salmon:
It is just a poison pill for debt that is not repaid on time. Basically, you borrow money at fixed interest rate but with a redemption period. If you fail to redeem the debt on time you get nationalized. Simple really.
It's clear why the plan is a bad idea: it gives banks' executives every incentive to take massive risks to avoid nationalization. When the last thing we need, obviously, is a bunch of trillion-dollar Hail Mary passes.That's a good point. Focusing on the punative angle at this point risks ignoring the fact that desperate people are likely to do stupid things.
So, the question is - what do you do to the banks to keep them from burning down their own houses out of desperation?
Or do you just seize them before they start being stupid?
Bloomberg: AIG Rescue May Include Credit-Default Swap Backstop
The government is going to shore up AIG's inability to pay on Credit Default Swaps.
To the tune of.....?
(H/t Calculated Risk)
To the tune of.....?
AIG provided protection on more than $300 billion of assets through credit derivatives as of Sept. 30. Credit-default swaps pay the buyer face value on their debt holdings in exchange for the underlying securities if the borrower fails to meet its obligations. It wasn’t immediately clear how many of the swaps would be backed by the U.S., and talks are continuing, the person said.
(H/t Calculated Risk)
Bad Math, or "A gaussian copula function ate my economy"
Take a look at this:
Wired tells us why in, Recipe for Disaster: The Formula That Killed Wall Street
A spectacularly informative read.
The boiled down version is this:
A guy named David Li came up with this formula to model the risks of bonds. He ignores all the complex risk factors that have stymied analysts for decades and just focuses on the cost of insuring the bonds. The price of the bond insurance (Credit Default Swaps) goes up, the bond is risky. The CDS price goes down, the bond is safe.
Li intended this as a limited tool for limited use - but it was so easy to misunderstand, this equation becomes almost ubiquitous in rating the risk of investments like CDOs.
By way of analogy, Li's saying use CDS's as a sort of Intrade for bond investments.
You can see the obvious risks there, but Wall Street chose not to care. After all, they were making money.
Read the article, it's just brilliant.
A whole bunch of smart people using a tool they don't understand to sell crap investments to the world.
(H/t CJR)
Late edit: By way of equal time, here's a thundering counterpoint to the article via Falkenblog.
Pr[TA<1, TB<1] = Φ2(Φ -1(FA(1)), Φ-1(FB(1),γ)That little formula is a big part of why your 401K is in the toilet right now.
Wired tells us why in, Recipe for Disaster: The Formula That Killed Wall Street
A spectacularly informative read.
The boiled down version is this:
A guy named David Li came up with this formula to model the risks of bonds. He ignores all the complex risk factors that have stymied analysts for decades and just focuses on the cost of insuring the bonds. The price of the bond insurance (Credit Default Swaps) goes up, the bond is risky. The CDS price goes down, the bond is safe.
Li intended this as a limited tool for limited use - but it was so easy to misunderstand, this equation becomes almost ubiquitous in rating the risk of investments like CDOs.
By way of analogy, Li's saying use CDS's as a sort of Intrade for bond investments.
You can see the obvious risks there, but Wall Street chose not to care. After all, they were making money.
Read the article, it's just brilliant.
A whole bunch of smart people using a tool they don't understand to sell crap investments to the world.
(H/t CJR)
Late edit: By way of equal time, here's a thundering counterpoint to the article via Falkenblog.
Winter, like I remember
Begobug sent along this article - which reminds me of growing up on the frigid shores of the Great Lakes. Back when winter was winter, not this mamby-pamby, global-warmed period of cool breezes we know today.
When snowmobiles drove over houses, and shifting snowdrifts tore fences out of the ground.
Garrison Keillor remembers, too:
When snowmobiles drove over houses, and shifting snowdrifts tore fences out of the ground.
Garrison Keillor remembers, too:
Winter gave us a sense of purpose, to persevere, to go to school no matter what and to keep shoveling the walk and throw the snow up on the snowbank 15 feet overhead, clearing the narrow canyon of sidewalk with clothesline tied to our belts so that in case of avalanche, they could pull us out in time, watching for incoming icicles that dropped like artillery shells, and also for coyotes that grew daring by late February and would take on a boy, especially one who was immobilized by heavy clothing.Ahh, those were the days...
Wednesday, February 25, 2009
Pelosi shows some spine
Trust Dr. Maddow to get to the bottom of things. According to early interview transcripts obtained by Glenn Greenwald, Nancy Pelosi told Rachel Maddow that she "absolutely" would support a criminal investigation of NSA wiretapping.
Color me suspicious - but that would be the first good news on the wiretapping issue for quite some time.
Color me suspicious - but that would be the first good news on the wiretapping issue for quite some time.
The Foggo war
Propublica's got a nice article on the misdeeds of former CIA heavy, Kyle Dusty Foggo:
Wilkes... where did I hear that name before...?
Oh yeah.
The really priceless part of the article is the graphic it starts with: a photo of the wine locker in the Capitol Club shared by Wilkes and Foggo - with both their names printed on it.
Owch.
Foggo's pled to get 37 months and is hoping the judge gives him even less.
Here's hoping the judge gives him just what he agreed to.
Late edit: Bonus: read Foggo's version of chivalry (at least for his mistress)
One remarkable affidavit came from a leader of SAD, a branch of the CIA's National Clandestine Service, which handles covert actions. It indicates that Foggo forced SAD to use a shell company set up by defense contractor Brent R. Wilkes to handle its sensitive air operations, even though Wilkes and his company had no experience in clandestine aviation operations.
Wilkes... where did I hear that name before...?
Wilkes was Foggo's boyhood friend and a co-conspirator in the bribery scandal that erupted around former Rep. Randy "Duke" Cunningham, who is serving more than eight years in federal prison.
Oh yeah.
The really priceless part of the article is the graphic it starts with: a photo of the wine locker in the Capitol Club shared by Wilkes and Foggo - with both their names printed on it.
Owch.
Foggo's pled to get 37 months and is hoping the judge gives him even less.
Here's hoping the judge gives him just what he agreed to.
Late edit: Bonus: read Foggo's version of chivalry (at least for his mistress)
AT&T: wasting your time, for no good reason
The other day, I'm filling in a spreadsheet of our monthly expenses - something I always start, but never seem to finish to my satisfaction.
You start with the things that break down easily into months (mortgage, utilities, burritos...) and gradually work towards the squishier aspects of the budget (groceries, gasoline, car repair).
But it's not rocket science. I'm banging through the utility portion when I get to my cell bill.
I have AT&T.
In the normal run of things - I'd look at my last bill and take the monthly amount and punch it in. I don't have a paper bill anymore, so the next step is the website.
In the ideal world, this is a three step process.
The AT&T universe has many fault lines and so has multiple log ins. I've had as many as 5. AT&T is trying to simplify things, but it's clear they're not there yet.
AT&T offered me the option to combine my phone/internet and wireless bills last year. About the third time I tried, they let me. This process took two months. Apparently, billing happens in cycles - and nothing is immediate.
Whatever. I'll log in, view the wireless portion of my bill and be done.
Except the wireless bill is $104.14.
This is not right. That has never been my monthly rate. I go into the detail on the bill and (over the course of scanning a seven page document) discover that my current wireless bill is a combination of the prior billing period and the current one.
This takes some doing.
By asking to combine my bills, I have created a break between the old way of doing things and the new way.
AT&T's process deals with that by rolling a pro-rated bill for December (as of when I decided to combine bills) and my January bill.
If a normal company wanted to show you your bill, they might do it like this:
December (pro-rated) - $47.03 [Show detail]
January $57.11 [Show detail]
But this is AT&T, I get $104.14 as a single, linked line item.
Clicking on that, I get:
[Mis-aligned dollar values are in the orignal]
I asked for a sip of water, AT&T passes me a fire hose.
Okay - I've actually made that a LOT clearer than the document AT&T shows you.
The actual document starts with a legalese preamble, and I've only shown you the detail for the prorated December blob. There's an even longer blob for January.
It takes an interminable amount of scanning to recognize this, because each giant data blob is separated by a single line of dates.
Giant blob #1 is a partial bill, so I skip to giant blob #2.
GB# 2 starts with this mis-aligned summary:
Okay. I'll read that as my monthly bill is $59.99 and I'm getting some discount. I know there's a discount for combining bills, so I'm wondering if that discount is it. In the detail that follows the discount is helpfully referred to as "Promotions and Discounts."
As long as I'm budgeting, I want to know if this is a recurring discount that I can count on ($10.80 per month is a big enough deal) or if this is yet another of AT&T's byzantine account modifications. I do a CTRL-F to find 10.80 elsewhere in the giant blob and strike out.
No more detail.
I log into my AT&T Wireless account to see what my bills have been in the past. The wireless site shows amounts that vary between $47 and $153. Clicking on detail, I see more giant blobs of gobbledygook.
Deep breath.
I opt to call.
I know - this is stupid - but again, I have this expectation that this will be simple.
I click on the contact us link and (miracle of miracles) I am directed to a single phone number in less than five clicks. Progress!
I dial.
Okay, this sucks - but it's my lunch hour, I've got some time - and I can work as I wait.
Six minutes later, I get a rep.
I self-identify, prove it, and ask for my monthly bill amount.
The rep gives it to me.
(There, you see? this was easy!)
I then ask about the discount.
Is that a discount I'm getting for moving my bill?
Oh. I get a discount because I work for a large company.
Great, so that is a recurring discount?
Uh?
-Right about now - I'm getting that familiar sinking feeling. So... THIS is how this call will go horribly wrong.
How much is the combined discount?
Can't you?
Time passes...
Okay - two things: 1) they should know this. I gave them my SSN, for crying out loud. 2) If you needed it, couldn't you have asked for it BEFORE I had to sit on hold?
I give the rep my number, and they apologize profusely.
So profusely, it turns out, that they are dropped from Land Line's hold queue. They have to call Land Line again and wait.
Again.
Time passes...
Yes?
What does that mean?
You mean I've lost my corporate discount?
I'll get to keep my discount, going forward?
At this point - it's clear that the rep is just telling me what she hopes is true.
I hope she's right, but I'm out of lunch time - so there's no time to iron this out. I'll need to watch for the next bill to make sure.
I hang up.
Elapsed time?
27 minutes and 28 seconds.
(plus about 10 minutes with the website)
Net result: I know what my plan costs (but I knew that) but I have no idea if AT&T will carry forward my current $10.80 discount.
And I lost 37 minutes of my life.
You start with the things that break down easily into months (mortgage, utilities, burritos...) and gradually work towards the squishier aspects of the budget (groceries, gasoline, car repair).
But it's not rocket science. I'm banging through the utility portion when I get to my cell bill.
I have AT&T.
In the normal run of things - I'd look at my last bill and take the monthly amount and punch it in. I don't have a paper bill anymore, so the next step is the website.
In the ideal world, this is a three step process.
- Go to vendor's website
- Log in
- View last bill
The AT&T universe has many fault lines and so has multiple log ins. I've had as many as 5. AT&T is trying to simplify things, but it's clear they're not there yet.
Welcome to AT&T, please select an arbitrary partition.
AT&T offered me the option to combine my phone/internet and wireless bills last year. About the third time I tried, they let me. This process took two months. Apparently, billing happens in cycles - and nothing is immediate.
Whatever. I'll log in, view the wireless portion of my bill and be done.
Except the wireless bill is $104.14.
This is not right. That has never been my monthly rate. I go into the detail on the bill and (over the course of scanning a seven page document) discover that my current wireless bill is a combination of the prior billing period and the current one.
This takes some doing.
By asking to combine my bills, I have created a break between the old way of doing things and the new way.
AT&T's process deals with that by rolling a pro-rated bill for December (as of when I decided to combine bills) and my January bill.
If a normal company wanted to show you your bill, they might do it like this:
December (pro-rated) - $47.03 [Show detail]
January $57.11 [Show detail]
But this is AT&T, I get $104.14 as a single, linked line item.
Clicking on that, I get:
Combined Billing took effect on Dec 19, 2008.
To align the Wireless Billing Cycle more closely
With other Combined services, the next Wireless
Billing Cycle Will begin on Dec 29, 2008.
Wireless Summary - [ACCOUNT #]
Cycle Dates: Nov 29, 2008 - Dec 28, 2008
Promotions and Discounts $3.20CR
Monthly Service $39.99
Credits, Adjustments and Other Charges $3.97
Data Usage $6.27
Total Wireless Charges $47.03
Mobile Charges Summary
[Phone # 1] Group: 1
[USER 1]
Promotions and Discounts $0.53CR
Monthly Service $6.66
Credits, Adjustments and Other Charges $0.78
Data Usage $0.80
Charges for this mobile $7.71
[Phone # 2] Group: 1
[USER 2]
Promotions and Discounts $2.67CR
Monthly Service $33.33
Credits, Adjustments and Other Charges $3.19
Data Usage $5.47
Charges for this mobile $39.32
Group Usage Summary - Group: 1
Voice
Rollover Summary
Previous Balance 3,433
Unused Minutes Added 411
Minutes Expired (*) -304
Current Rollover Balance 3,540
(*) Unused Plan Minutes Expired
After 12 Billing Periods
[MYSTERIOUS NUMBER]
211 Minutes Used by [Phone # 1]
118 Minutes Used by [Phone # 2]
329 Minutes Used by This Group
550 Minutes Included
[Phone # 1] - [USER 1]
Promotions and Discounts
National Account Discount .53 CR
Total Promotions and Discounts .53 CR
Monthly Service
New Bill Cycle 12/29-01/18
[MYSTERIOUS NUMBER] 6.66
Proration Calculation
Monthly Service Charge $9.99
Divided by Avg days in Month / 30
Times Days On New Cycle X 20
Equals New Cycle Prorated Charge = $6.66
Part of this month was spent on the New Bill Cycle
Charges apply for those days.
Dollars are rounded to the next whole cent.
Total Monthly Service 6.66
Credits, Adjustments and Other Charges
Regulatory Cost Recovery Charge .20
County Sales Surcharge .03
Federal Universal Service Charge .19
[State] State Sales Surcharge .36
Total Credits, Adjustments and Other Charges .78
Voice Usage Summary
Unlimited Expd M2M
23 Minutes Used
Rollover FM 550
89 Minutes Used
Unlimited N&W
99 Minutes Used
Total Voice Usage Summary .00
Data Usage Summary
Text Msg Pay Per Use
4 Text Messages Used
4 Billed at $0.20/Msg .80
Total Text Msg Pay Per Use .80
Total Data Usage Summary .80
Total for [Phone # 1] 7.71
[Phone # 2] - [USER 2]
Promotions and Discounts
National Account Discount 2.67 CR
Total Promotions and Discounts 2.67 CR
Monthly Service
New Bill Cycle 12/29-01/18
[MYSTERIOUS NUMBER] 33.33
Proration Calculation
Monthly Service Charge $50.00
Divided by Avg days in Month / 30
Times Days On New Cycle X 20
Equals New Cycle Prorated Charge = $33.33
Part of this month was spent on the New Bill Cycle
Charges apply for those days.
Dollars are rounded to the next whole cent.
Total Monthly Service 33.33
Credits, Adjustments and Other Charges
Regulatory Cost Recovery Charge .20
County Sales Surcharge .19
Federal Universal Service Charge .94
[State] State Sales Surcharge 1.86
Total Credits, Adjustments and Other Charges 3.19
Voice Usage Summary
Unlimited Expd M2M
36 Minutes Used
Rollover FM 550
50 Minutes Used
Unlimited N&W
32 Minutes Used
Total Voice Usage Summary .00
Data Usage Summary
Text Msg Pay Per Use
26 Text Messages Used
26 Billed at $0.20/Msg 5.20
Total Text Msg Pay Per Use 5.20
InternetPayPerUse
27 Kilobytes Used
27 Billed at $0.01/KB .27
Total InternetPayPerUse .27
Total Data Usage Summary 5.47
Total for [Phone # 2] 39.32
Total Invoice Charges 47.03
Wireless Summary - [ACCOUNT #]
[Mis-aligned dollar values are in the orignal]
I asked for a sip of water, AT&T passes me a fire hose.
Okay - I've actually made that a LOT clearer than the document AT&T shows you.
The actual document starts with a legalese preamble, and I've only shown you the detail for the prorated December blob. There's an even longer blob for January.
It takes an interminable amount of scanning to recognize this, because each giant data blob is separated by a single line of dates.
Giant blob #1 is a partial bill, so I skip to giant blob #2.
GB# 2 starts with this mis-aligned summary:
Promotions and Discounts $10.80CR
Monthly Service $59.99
Credits, Adjustments and Other Charges $4.72
Data Usage $3.20
Total Wireless Charges $57.11 Okay. I'll read that as my monthly bill is $59.99 and I'm getting some discount. I know there's a discount for combining bills, so I'm wondering if that discount is it. In the detail that follows the discount is helpfully referred to as "Promotions and Discounts."
As long as I'm budgeting, I want to know if this is a recurring discount that I can count on ($10.80 per month is a big enough deal) or if this is yet another of AT&T's byzantine account modifications. I do a CTRL-F to find 10.80 elsewhere in the giant blob and strike out.
No more detail.
I log into my AT&T Wireless account to see what my bills have been in the past. The wireless site shows amounts that vary between $47 and $153. Clicking on detail, I see more giant blobs of gobbledygook.
Deep breath.
I opt to call.
I know - this is stupid - but again, I have this expectation that this will be simple.
- Call
- Identify self & authenticate
- Ask for monthly bill, receive same.
- Hang up
I click on the contact us link and (miracle of miracles) I am directed to a single phone number in less than five clicks. Progress!
I dial.
Your expected hold time is four minutes.
Okay, this sucks - but it's my lunch hour, I've got some time - and I can work as I wait.
Six minutes later, I get a rep.
I self-identify, prove it, and ask for my monthly bill amount.
The rep gives it to me.
(There, you see? this was easy!)
I then ask about the discount.
Is that a discount I'm getting for moving my bill?
No, that's a corporate discount.
Oh. I get a discount because I work for a large company.
Great, so that is a recurring discount?
Well, sir. When you transfer your account, that discount may be replaced by the combined bill discount.
Uh?
You can only have one discount.
-Right about now - I'm getting that familiar sinking feeling. So... THIS is how this call will go horribly wrong.
How much is the combined discount?
I don't have that information. You'll have to contact Land Line.
Can't you?
Please hold.
Time passes...
Sir? Can you give me your Land Line number?
Okay - two things: 1) they should know this. I gave them my SSN, for crying out loud. 2) If you needed it, couldn't you have asked for it BEFORE I had to sit on hold?
I give the rep my number, and they apologize profusely.
So profusely, it turns out, that they are dropped from Land Line's hold queue. They have to call Land Line again and wait.
Again.
Time passes...
Sir?
Yes?
Land Line could not find a combined discount on your account.
What does that mean?
It means they cannot find a discount on your combined account. It might show up on the next billing cycle...
You mean I've lost my corporate discount?
I don't think so, sir. I think you should keep that one.
I'll get to keep my discount, going forward?
I'm pretty sure.
At this point - it's clear that the rep is just telling me what she hopes is true.
I hope she's right, but I'm out of lunch time - so there's no time to iron this out. I'll need to watch for the next bill to make sure.
I hang up.
Elapsed time?
27 minutes and 28 seconds.
(plus about 10 minutes with the website)
Net result: I know what my plan costs (but I knew that) but I have no idea if AT&T will carry forward my current $10.80 discount.
And I lost 37 minutes of my life.
Tuesday, February 24, 2009
Earth to Santelli: Shut the hell up
God, but this guy is a tin-eared demagogue.
CJR's Ryan Chittum takes Santelli to task for this latest attempt at self-inflation: appearing with G. Gordon Liddy to claim the White House has threatened him.
Santelli's a bonehead - and while I'll refer you to Chittum's takedown of his recent stupidity, I'd just like to revisit the original bag of stupid that started this mess:
Now with a little typographic judo - we can redirect this back at Santelli:
CJR's Ryan Chittum takes Santelli to task for this latest attempt at self-inflation: appearing with G. Gordon Liddy to claim the White House has threatened him.
Santelli's a bonehead - and while I'll refer you to Chittum's takedown of his recent stupidity, I'd just like to revisit the original bag of stupid that started this mess:
Why don’t you put up a website to have people vote on the Internet as a referendum to see if we really want to subsidize the loser’s mortgages...?
How many of you want to pay for your neighbors mortgage that hasan extra bathroom and can't pay their bills? raise their hands!
...President Obama, are you listening?”
Now with a little typographic judo - we can redirect this back at Santelli:
Why don’t you put up a website to have people vote on the Internet as a referendum to see if we really want to subsidizeI'd love to see Santelli's answer.the loser’s mortgagesWall Street's stupidity...?
How many of you want to pay foryour neighbors mortgage that has an extra bathroomidiot bankers that have million-dollar bathrooms and can't pay their bills? raise their hands!
...President ObamaMr. Santelli, are you listening?”
Common Stock vs Preferred Stock
CitiGroup wants the gov't to convert its preferred stock to common stock
ProPublica's saying that the Treasury Department has announced they will allow banks to convert the existing government shares into common stock.
What the hell is up with common stock? and why the sudden movement away from preferred stock?
Thankfully, The Baseline Scenario is here to answer that question.
Spoiler: the government is being stupid.
ProPublica's saying that the Treasury Department has announced they will allow banks to convert the existing government shares into common stock.
What the hell is up with common stock? and why the sudden movement away from preferred stock?
Thankfully, The Baseline Scenario is here to answer that question.
Spoiler: the government is being stupid.
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