slumlord's rumblings

2009-08-09T20:31:00.003-07:00

Factoring from Marketplace on Vimeo.

2009-08-09T20:31:00.001-07:00

Financial alchemy from Marketplace on Vimeo.

Where’s the toxic waste?

2009-07-15T07:15:00.000-07:00

Where’s the toxic waste? from Marketplace on Vimeo.

Eddie Bauer files for bankruptcy protection

2009-06-17T19:59:00.000-07:00

known for outdoorsy clothing but serving a distinctly more domestic clientele of students and other mall patrons, the company said Wednesday that a bidder has agreed to keep the majority of its 371 stores open and honor its gift cards and hold onto most employees.

The company said CCMP Capital Advisors LLC has bid $202 million in cash for its assets. Other buyers may also make bids while the company is under court protection.

Bankruptcy rumors had been swirling as Bellevue, Washington-based Eddie Bauer struggled with slumping sales amid the recession. It reported a loss for the first quarter of $44.5 million as sales fell 16 percent to $179.8 million.

It had $476.1 million in assets and $426.7 million in debt at the time of the filing Wednesday with the U.S. Bankruptcy Court of the District of Delaware.

Parking in your own driveway could be illegal

2009-06-16T20:54:00.000-07:00

http://abclocal.go.com/wtvg/video?id=6866363

Senator Durbin Used Information Gleaned from Meeting with Fed to Protect (Ass)ets

2009-06-16T12:01:00.000-07:00

As U.S. stock markets plummeted last September, the Senate’s No. 2 Democrat, Dick Durbin, sold more than $115,000 worth of stocks and mutual-fund shares and used much of the money to invest in Warren Buffett’s Berkshire Hathaway Inc.

The Illinois senator’s 2008 financial disclosure statement shows he sold mutual-fund shares worth $42,696 on Sept. 19, the day after then-Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke urged congressional leaders in a closed meeting to craft legislation to help financially troubled banks. The same day, he bought $43,562 worth of Berkshire Hathaway’s Class B stock, the disclosure shows. Altogether, Durbin sold investments worth $116,000 in September. By Oct. 2, he had invested $98,046 in Omaha, Neb.-based Berkshire Hathaway, the form shows.

The Standard & Poor’s 500 index plunged 4.7 percent last Sept. 15 after the bankruptcy of Lehman Brothers Holdings Inc. and Bank of America Corp.’s government-engineered takeover of Merrill Lynch & Co. By the end of October, the index had fallen 22.6 percent.

“Durbin was doing what a lot of other people were doing, taking a look at their savings” and seeing it “start to tank and trying to preserve some level of wealth by getting out of the market,” said his spokesman, Joe Shoemaker.

Shoemaker said Durbin didn’t capitalize on anything Paulson and Bernanke told congressional leaders at the Sept. 18 meeting.

Whatever information Paulson gave lawmakers wasn’t secret or classified and was disclosed publicly the next day, Shoemaker said.

Meet Cap 'n Trade

2009-06-12T22:39:00.000-07:00

Meet Cap 'n Trade from Marketplace on Vimeo.

Median Home Prices In Detroit Fall To $6,000

2009-06-12T22:36:00.000-07:00

In 2008 Detroit ranked as the United States's eleventh most populous city, with 916,952 residents. At its peak in 1950 the city was the fourth largest in America. The name Detroit sometimes refers to the Metro Detroit area, a sprawling region with a population of 4,425,110

Although I am a deflationist, I must admit surprise that the median home price in Detroit has fallen to a stunningly low $6,000.

Metro Detroit home sales rose by 12.6% in May as compared with last year, yet home prices continued their fall -- an indication that the market hasn't hit bottom yet.

Overall, 5,955 homes were sold in May, compared with 5,288 sold in May 2008, according to Realcomp, a Farmington Hills-based multiple listing service. The median sales price for homes sold in May was $50,000, a 44.3% drop from $89,700 in May 2008.

Foreclosures continue to drag down prices. In May, foreclosure sales accounted for 60% of all homes sold. And the median price of foreclosed sales in the metro area was $26,400 compared with a median sales price of $110,000 on non-foreclosed homes.

In the city of Detroit, the median sales price in May was $6,000, down 29.4% from May 2008.

Capital structure

2009-05-09T20:51:00.001-07:00

Capital structure from Marketplace on Vimeo.

2009-05-09T20:48:00.001-07:00

Shadow banking by Marketplace

2009-04-21T18:03:00.000-07:00

Shadow banking from Marketplace on Vimeo.

The public-private partnership

2009-04-07T19:54:00.001-07:00

The public-private partnership from Marketplace on Vimeo.

Collateral calls

2009-03-31T08:29:00.000-07:00

Collateral calls from Marketplace on Vimeo.

Frank Partnoy: Derivative Dangers

2009-03-27T22:59:00.000-07:00

Frank Partnoy: Derivative Dangers

This is a must listen from NPR
Partnoy joins Fresh Air to explain derivatives, credit default swaps and how they led to the current financial crisis.

Quote of the day

2009-03-24T09:17:00.000-07:00

“To have the freedom to succeed, we must preserve the freedom to fail. Any solution to our present crisis must preserve our essential economic freedom.”

“The morning after the banking bailout last fall, I was back home at a Boy Scout Jamboree. And a man of very modest means approached me on that hillside in Henry county. Hat in his hand, he told me he’d been fired from his job the day before.

And then he said words that I’ll never forget. He said , “Congressman, I came by to thank you for voting against that wall street bailout. Cause, he said, I can get another job - I can’t get another country”

Mike Pence
is a Republican member of the United States House of Representatives for Indiana's 6th congressional district.

CNBC Gives Financial Advice

2009-03-07T15:18:00.000-08:00

The Daily Show With Jon StewartM - Th 11p / 10c

CNBC Gives Financial Advice

Daily Show Full Episodes
Important Things With Demetri Martin

Political Humor
Joke of the Day

socialism

2009-03-06T19:43:00.000-08:00

Bye Bye Blockbuster? Shares Tank 77%

2009-03-03T19:53:00.000-08:00

Blockbuster (BBI) shares fell off a cliff today tanking 77% after a report was released saying the company had hired lawyers to explore filing for bankruptcy.

According to the Associated Press, Blockbuster “has hired law firm Kirkland & Ellis and is also working with investment bank Rothschild, said the source, who asked not to be named.”

The selling began at 2:01 PM EST and the stock bottomed at 2:09 PM EST. That is the fasted 50%+ fall we have seen in quite some time. Trading continued until continued until what looks to be 2:25 PM before being suspended.

The stock closed at $.21. Intraday chart below (5 minute intervals).

socialism illustrated

2009-03-02T19:39:00.000-08:00

2009-02-28T17:45:00.003-08:00

Hudson River Plane Landing (US Airways 1549) Animation with Audio

2009-02-28T17:40:00.000-08:00

The Crisis of Credit Visualized

2009-02-27T14:38:00.000-08:00

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

Ritz Camera on Monday filed for Chapter 11 bankruptcy protection

2009-02-24T19:33:00.000-08:00

Ritz Camera Centers Inc, which said it is the largest U.S. specialty camera and imaging chain, on Monday filed for Chapter 11 bankruptcy protection, hurt by the recession and consumers' shift to digital photography.

The Beltsville, Maryland-based company filed for protection from creditors with the U.S. bankruptcy court in Wilmington, Delaware. Ritz said it has between $100 million and $500 million of both assets and liabilities.

Ritz operates under such names as Ritz Camera, Wolf Camera, Kits Cameras, Inkley's and The Camera Shops, and also operates the 130-store Boater's World Marine Centers chain. It said it had nearly $1 billion of revenue in the year ended Nov. 30, 2008.

In an affidavit, Chief Restructuring Officer Marc Weinsweig said the company's lenders ordered the company in January to boost reserves, thereby reducing available credit.

He said this came after the recession caused Ritz's 2008 holiday sales to be "materially lower" than a year earlier. Ritz was also hurt by losses at Boater's World, which suffered falling sales in 2008 as gas prices soared.

"The loss of revenues and profit margins from the diminution in the photo-finishing business proved too much of a burden, coupled with the losses experienced by the Boater's World business in 2008," he wrote.

Ritz said it will seek court permission to obtain $85 million of financing to keep operating while it restructures.

Among the largest unsecured creditors are Nikon Inc (7731.T: Quote, Profile, Research), with a $26.6 million claim, and Canon USA Inc (7751.T: Quote, Profile, Research), with a $13.7 million claim, the bankruptcy petition shows.

Rick Santelli Rant

2009-02-22T20:08:00.000-08:00

Just one more Time Bomb

2009-02-22T07:43:00.000-08:00

The amount of speculative-grade debt maturities will increase in the next three years, Moodys said, from $26bn in 2009, to $44bn in 2010, and $120bn in 2011.

In finance, a high yield bond (non-investment grade bond, speculative grade bond or junk bond) is a bond that is rated below investment grade at the time of purchase. These bonds have a higher risk of default or other adverse credit events, but typically pay higher yields than better quality bonds in order to make them attractive to investors.

2009-02-21T17:07:00.000-08:00

Collapse of tax revenues+monetization+huge growth of Treasury supply meets Populist Revolt and voila! A superhighway to US debt repudiation.

Decline of California

2009-02-20T20:25:00.000-08:00

The tax increases will continue to chase even more productive people out of the state. For at least two years, the sales tax would rise by one percentage point to 8.25% and the income tax by 0.3% to a top marginal rate of 10.56%. These will both be the highest statewide rates in the nation (see chart).

Do these taxes hurt business? Ask Hollywood. Film makers are threatening to flee to avoid the state's high costs, so to keep them in Southern California the deal offers $500 million in tax breaks for producers. Rich liberals like Rob Reiner, who love higher taxes on other people, get a sweetheart tax break and everyone else pays more.

Mr. Schwarzenegger is finally getting a constitutional state spending cap that will be on the ballot in the next election, but even that is flawed. This cap would limit spending hikes in any year to a rolling average of the percentage increase of the past 10 years. Nice idea, except that if Californians vote yes, the higher income and sales taxes automatically kick in for three more years. So to get a modicum of spending restraint, the voters have to agree to tax themselves by $25 billion more for three additional years. Californians can be forgiven if they say "no deal."

The tragedy of this gamesmanship is that the political class still won't address the root cause of its financial problems, which is that the state is becoming less economically competitive. California businesses and high-income families already pay a surtax for locating inside the state. The new budget deal raises that tax toll higher still.

It's no surprise that most CEOs we talk to, many of whom live in California, say they'd be foolish to build another plant in the state. California's budget crisis is the inevitable result of runaway liberal governance, and the state's voters will keep paying for it until they reduce their tax burden and adopt more radical spending controls.

California, a state that would rank as the world’s eighth largest economy, is close to running out of cash

2009-02-17T08:59:00.000-08:00

Darrell Steinberg, a Democrat, plans to lock lawmakers in the capitol unless they pass a $40 billion package of tax increases, spending cuts and bond sales today.

The budget proposal would raise the state sales-tax rate to 8.25 percent from 7.25 percent; boost vehicle license fees to 1.15 percent from 0.65 percent of the value of an automobile; add 12 cents to the per-gallon gasoline tax; reduce the dependant-care tax credit to $100 from $300 and impose a surcharge on income taxes of up to 5 percent. That's right a tax on your tax.

Combined, the measures would raise taxes and fees by $14 billion, cut spending $16 billion and add $10 billion to the state’s debt. Another $2 billion in reserves would be created from funds moved on balance sheets.

Your Government at work

2009-02-15T12:34:00.000-08:00

New lead rules send small dirt bikes to storage
Sunday February 15, 2:40 pm ET
By Kahrin Deines, Associated Press Writer

New lead limits force motorcycle dealers to pull kids' dirt bikes off showroom floors HELENA, Mont. (AP) -- A new national limit on lead in children's products -- which has toy makers scrambling for new testing methods and retailers for storage space for inventory they're not sure they can sell -- also is forcing motorcycle dealers to pull dirt bikes off showroom floors.

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It became illegal Tuesday to sell off-road machines geared for children younger than 12 because parts in them contain lead at levels greater than 600 parts per million. Most motor vehicles have such parts.

"I think they took this law a little too far," said Margie Hicklin-Krsul, the owner of Redline Sports, a sports bike dealership in Butte. "I've never had anyone come in and say, 'My child keeps putting parts of his motorcycle into his mouth.'"

About 100,000 of the bikes -- popular for trails, zipping around backyards and racing on motocross tracks -- sold last year for $1,500 or more, according to industry estimates. The ban, not yet permanent, is a blow to motocross racers of any age who want a small bike and now won't be able to get new equipment or repair what they have.

Dealerships -- where sales already were sputtering due to the recession -- received notices over the last month that they must pull the bikes off showroom floors. Industry leaders say some 13,000 dealers are now stuck with $100 million worth of inventory that may end up worthless.

Congress tightened lead limits on children's products last summer after a series of discoveries of dangerous lead levels in toys, and the rules took partial effect last week when a judge nixed a 12-month reprieve while the Consumer Products Safety Commission finalizes them.

The law won't be enforced for a year, but retailers can no longer sell products that contain materials in question. And they may find once the rules are clarified that the inventory now filling their storage rooms is worthless.

Congress is getting an earful. U.S. Rep. Danny Rehberg, R-Mont., fielding angry phone calls over the issue, blamed "government bureaucrats" for bungling implementation of the original law.

Makers of dirt bikes and motocross equipment are seeking an exemption for their products, but the federal consumer agency is still reviewing the request.

"We're hoping that they see their way to a difference between a children's necklace and a motor part that has very little chance of being ingested by a child," said Tim Patnode, spokesman for American Honda.

Dealers worry the ban will have the perverse effect of pushing kids onto larger, more powerful models if the ones running with engine displacement between 50 cubic centimeters and 100 are no longer available. They also say the ban will discourage families from introducing young riders to the sport.

"Every one of my nieces and nephews has learned to ride on 50s and then I've worked them up to the bigger bikes," said Hicklin-Krsul, the Butte dealer.

The ban applies to used and new small off-road machines -- and the parts to service them. Even the agency administering the ban understands it might be counterproductive.

"It is critically important to the Consumer Product Safety Commission that youth models be available because we are the federal agency that has investigated numerous deaths involving young riders who jumped on to adult-size ATVs," said Scott Wolfson, spokesman for the commission.

But he said the agency is reviewing thousands of products to decide if they meet the new lead standards.

Renton Motorcycle Co. outside Seattle moved 169 dirt bikes and ATVs off its sales floor last Tuesday. After selling about 600 starter bikes and ATVs in 2008, the shop now may not be able to service them or accept them in trade for a bigger bike, said sales manager Mike Dunaway.

"If someone has a little 50 and their son's now grown up, how can we move them up to the next model?" Dunaway asked.

Dealers have been warned that a single violation of the law carries a fine of $1,825 and penalties could run to $1.8 million with repeated offenses.

For the time being, most manufacturers are offering to cover the cost dealers face each month for the stock they are holding in hopes the ban will be lifted.

"We're going to park them in the back room and wait for the government to decide what to do," said Wayne Gabbert, owner of Outdoor Motor Sports Inc. in Helena. "It's another one of these good-government deals where they try to save everybody."

Trump Quits Trump Entertainment, Bankruptcy Possible

2009-02-15T09:26:00.000-08:00

Feb. 13 (Bloomberg) -- Donald Trump resigned from the board of Trump Entertainment Resorts Inc., the debt-laden casino company he founded, ahead of a possible involuntary bankruptcy filing next week.

“I’m not managing it, it’s not me that’s responsible for managing,” Trump, who was chairman, said in a telephone interview today. “Unless we’re going to be responsible for management it’s just not something that’s worthwhile.”

Trump’s departure comes ahead of a Feb. 17 deadline to make a $53 million bond payment originally due on Dec. 1. The Atlantic City, New Jersey-based casino operator said at the time it needed to conserve cash and hold debt-restructuring talks with lenders. Since an initial grace period ended on Dec. 31, Trump Entertainment’s deadline has been extended four times.

The 62-year-old real estate entrepreneur has “no idea” whether there will be a bankruptcy filing, he said. Trump is “not thrilled” the company may continue to use his name.

Bondholders are planning to force Trump Entertainment into Chapter 11 bankruptcy early next week, the Wall Street Journal reported today, citing unidentified people familiar with the matter.

Trump controls 28 percent of the stock, according to a March 21 regulatory filing. His daughter, Ivanka Trump, also resigned, according to an e-mailed statement.

“I strongly disagree with the bondholders’ decisions and actions,” Trump said in the statement without elaborating.

Tom Hickey, a spokesman for Trump Entertainment, and Chief Financial Officer John Burke didn’t return phone messages left after normal business hours.

‘It’s a Disaster’

In the interview, Trump cited the “disastrous” fates of Atlantic City’s Tropicana Casino Hotel and the under-construction but not fully funded Revel Entertainment LLC project.

“It’s a disaster and I see what’s happened with so many others, and I don’t want to be a part of it,” Trump said.

so much for liability!

2009-02-14T14:40:00.000-08:00

The peanut processing company at the heart of a national salmonella outbreak, Peanut Corp. of America, has filed for Chapter 7 bankruptcy liquidation in court in Lynchburg, Virginia.

The bankruptcy papers were signed by Stewart Parnell, the president of Peanut Corp., who invoked his Fifth Amendment rights against self-incrimination in refusing to answer questions this week in a congressional hearing.

Bacteria found in the company’s Blakely, Georgia, peanut processing plant have been blamed for more than 600 cases of salmonella, including nine deaths.

The Texas Health Department on Thursday ordered products from the company’s plant in Plainview, Texas, to be recalled after discovering dead rodents, rodent excrement and bird feathers in the plant…

“It is unacceptable for corporations to put consumers’ health at risk and then simply declare bankruptcy and go out of business when they get caught,” said Jean Halloran, director of food policy initiatives at Consumers Union, publisher of Consumer Reports.

“PCA’s declaration of bankruptcy will, among other things, shield it from liability suits filed by consumers who became sick or whose loved ones died as a result of eating PCA’s peanut products,” she said.

There goes liability, responsibility. Nothing more than a slap on the wrist coming from the FDA.

Charter Plans to Implement Restructuring Through Chapter 11

2009-02-12T10:30:00.001-08:00

Feb. 12 (Bloomberg) -- Charter Communications Inc. said it plans to implement a financial restructuring through a Chapter 11 bankruptcy filing to occur on or before April 1. Charter disclosed the plans in a statement on Business Wire.

The Audacity of Dope

2009-02-11T19:34:00.000-08:00

Could legal marijuana save California’s economy?

By Jeff Segal

Some legislators in California have pot on their minds, too. That's because the government of the biggest economy in the United States is facing a massive budget deficit whose pain would be alleviated by decriminalizing marijuana.

California's current deficit stands at a whopping $15 billion and is expected to reach $42 billion next year. And the state run by Gov. Arnold Schwarzenegger has virtually run out of cash. It recently delayed $3.5 billion of payments to taxpayers and counties.

Marijuana is California's largest cash crop. It's valued at $14 billion annually, or nearly twice the value of the state's grape and vegetable crops combined, according to government statistics. Indeed, a recent report pegged marijuana as two-thirds of the economy of Mendocino County, a ganja hotbed north of San Francisco. That's not surprising—it costs $400 to grow a pound of pot that can sell for $6,000 on the street.

But the state doesn't receive any revenue from its cash cow. Instead, it spends billions of dollars enforcing laws pegged at shutting down the industry and inhibiting marijuana's adherents.

So what are the numbers? A national legalization effort would save nearly $13 billion annually in enforcement costs and bring in $7 billion in yearly tax revenues, according to a study by Harvard University economist Jeffrey Miron. Since California represents 13 percent of the U.S. economy, those numbers suggest the state could save $1.7 billion in enforcement costs and nab up to $1 billion in revenues. That doesn't include any indirect revenues as, for example, rural farming communities grow or marijuana tourism, which has been lucrative for the Netherlands, takes off.

Put it all together, and California could potentially wipe some $3 billion off its budget deficit by letting its people puff and pay. That still leaves it with a gaping $39 billion hole to fill, so the state's problems go far beyond what a new cash crop can fix. But anything to help soothe the state's chronic fiscal pain—even if unpalatable to some—is worth considering.

Dan Mitchell

2009-02-11T19:29:00.000-08:00

"Capitalism without bankruptcy is like religion without hell," said Dan Mitchell of the libertarian Cato Institute. "You're gonna remove one of the incentives that makes people behave wisely."

Madoff

2009-02-11T14:11:00.000-08:00

Based on information now available about the $50 billion Ponzi scheme, it appears that not only can rules be violated, but Bernard Madoff used his insider contacts at the SEC and around Wall Street to build a business that the SEC never audited between 1999, when he first received a letter from the SEC raising the question of a Ponzi scheme, until last week when the SEC conducted an examination of his business. In addition to advising the SEC, Madoff served as chairman of the NASDAQ Stock Market.

Donald Langevoort, a Georgetown University law professor, told the Washington Post, "Bernie had a good reputation at the SEC with a lot of highly placed people as an innovator as somebody who speaks his mind and knows what's going on in the industry. I think he was seen as a valuable resource to the commission in its deliberations."
Clearly this reputation Madoff built on Wall Street and in Washington allowed him to operate under the radar. Unfortunately for those now realizing how much they've lost, this lack of oversight by the SEC could result in closed charities and even more significant bank write offs. Exactly what we don't need right now.

We all must remember Warren Buffet's famous quote, "It's only when the tide goes out that you learn who's been swimming naked." Obviously Madoff and those who helped promote him were swimming naked under the waves of greed.

Bernard Madoff, who has been charged with running a Ponzi scheme that may involve as much as $50 billion in losses, advised the SEC on how to protect investors from scam artists when he served on an SEC advisory committee in the early 2000s. He publicly pushed the idea that "In today's regulatory environment, it's virtually impossible to violate rules" in this October 2007 conference.

Seniors Not Ready For Digital Conversion

2009-02-09T19:21:00.000-08:00

Rep. Ackerman on Madoff Fraud

2009-02-09T14:38:00.000-08:00

Harry Markopolos

2009-02-09T14:26:00.000-08:00

“ SEC lawyers did not understand derivatives…they did not know the math. They were lawyers and they were thinking like lawyers. They ran away from the big cases! SEC did not have financial specialists. The SEC is financially illiterate. Replace the senior staff…they can’t be young people in their twenties and thirties. That’s not what you need! You need older folks who already had a career in finance and made enough money to last a lifetime. — Harry Markopolos during Congressional hearing on Madoff and why SEC morons let him go on for so long

Vacant Homes

2009-02-09T09:44:00.000-08:00

The vacancy rate for homes typically occupied by the owner rose to 2.9% in the fourth quarter of 2008 from 2.8%, matching the all-time high set a year ago, the commerce Department reported Tuesday. Prior to the housing bubble bursting in 2005, the vacancy rate had never been above 2%. For rental properties, the vacancy rate rose to 10.1% from 9.9%. The homeownership rate fell to 67.5%, the lowest since 2001. In the fourth quarter, 2.2 million homes were vacant and for sale, virtually unchanged from a year earlier. The nation's housing stock increased by 2.2 million in 2008 to 130.8 million.

It had been thought that the problems in the "owner occupied" segment of the housing market would be a boost to the rental market (i.e. those that can no longer afford to own) and it has by number. The problem for those that own those rental homes is there is absolutely no pricing power due to the huge growth in vacancies.

Education and Unemployment

2009-02-09T09:38:00.000-08:00

#069 No Agenda for Thursday February 5th 2009

2009-02-07T17:24:00.000-08:00

#069 No Agenda for Thursday February 5th 2009

#070 No Agenda for Saturday February 7th 2009

Toxic assets

2009-02-03T21:31:00.000-08:00

Toxic assets from Marketplace on Vimeo.

What Is Mark To Market?

2009-02-03T21:04:00.000-08:00

Mark to market from Marketplace on Vimeo.

The Mess DHL Left Behind When It Pulled Out Of The US

2009-02-03T20:54:00.000-08:00

When DHL ended domestic shipping and laid off 9,500 people back in November, 60 Minutes says it was losing $6 million a day. Now the people of Wilmington, Ohio are cleaning up the mess that DHL left and are wondering what's next.

In 1980, Airborne Express turned Wilmington's abandoned Air Force base into a hub for overnight shipping. Eight thousand people found work at what they call "the air park." Then, in 2003 a German company, DHL, bought Airborne in an effort to win a big piece of the U.S. market. It didn't work. The merger was rocky, there were service disruptions, and customers left in droves. With last fall's economic crash, DHL was losing $6 million a day in the U.S.; layoffs started coming by the hundreds.

People who worked there for decades found themselves in DHL-sponsored meetings learning about unemployment.

Citibank's wise use of your money

2009-02-03T20:51:00.000-08:00

The New York Mets are getting a new stadium. It'll be called Citi Field and that honor cost Citibank (and by extension, one could argue, taxpayers) $400 million.

A week ago, two congressmen, Reps. Dennis Kucinich (D., Ohio) and Ted Poe (R., Texas) wrote to new Treasury Secretary Timothy Geithner, asking him to "push Citigroup to dissolve the Mets deal."

"Citigroup is now dependent on the support of the federal government for its survival as an institution," the letter said. "As such, we do not believe Citigroup ought to spend $400 million to name a stadium at the same time that they accept over $350 billion in taxpayer support and guarantees."

auto sales plunged to a 27-year low in January

2009-02-03T18:51:00.000-08:00

U.S. auto sales plunged to a 27-year low in January, a steeper-than-expected drop that took the slumping U.S. market below China's for the first time.

The two U.S. automakers struggling to restructure under a $17.4 billion government bailout led the market lower. Chrysler LLC posted a 55 percent sales plunge. Sales for General Motors Corp were down 49 percent.

The bleak results were one of the first indicators of the depth of the recession at the start of 2009, underscored by sharp declines by the industry's stronger players.

Toyota Motor Corp, the world's top automaker, was hit with a 34 percent sales decline. Sales were off almost 30 percent for Nissan Motor Co and 28 percent for Honda Motor Co.

Industry-wide sales dropped 37 percent, taking the annualized sales rate to 9.57 million vehicles, the lowest level since 1982. But that understates the depth of the downturn since the U.S. population has increased about a third since.

You Weren’t Invited

2009-02-02T17:31:00.000-08:00

Despite a near collapse that required $45 billion in federal taxpayer bailout funds, Bank of America sponsored a five day carnival-like affair just outside the Super Bowl stadium this past week as President Obama decried wasteful spending on Wall St. The event – known as the NFL Experience – was 850,000 square feet of sports games and interactive entertainment attractions for football fans and was blanketed in Bank of America logos and marketing calls to sign up for football-themed banking products.

The bank staunchly defended its sponsorship, saying it was a “business proposition” and part of its “growth strategy.”

Critics blasted the spending as a serious abuse of taxpayer money. “The prominent sponsorship of the Super Bowl says to the American people we’ll take your money and then we’re going to go waste it,” Tom Schatz, president of Citizens Against Government Waste, a watchdog group, told ABC News. Leading Congressional critic, Congressman Elijah Cummings, (D-MD), said, “They should know better, but obviously they don’t.” According to the Bank of America, the official bank of the NFL, its NFL partnerships and product tie-tins “generate significant revenue streams.” The bank said it was legally required to fulfill its contract to be an NFL sponsor and that its NFL product sales had already increased since the Experience began Jan. 24. The bank refused to tell ABC News how much it is spending as an NFL corporate sponsor, but insiders have put the figure at close to $10 million

What to do in the face of economic ruin?

Fly to Cabo San Lucas, of course — on the company jet. Ex-Citigroup CEO Sandy Weill used one of his former company’s multimillion dollar jets to whisk his family to Cabo San Lucas, Mexico, to ring in the New Year.

The ex-CEO used the $45 million Bombardier Global Express jet to carry himself, his wife Joan, and his daughter Jessica and her family to the exclusive One and Only Palmilla Resort.

Rooms at the resort, where Eli Manning was married last April, can go for upwards of $10,000 a night for a four-bedroom suite.

The jet Weill took to Mexico features a full bar, crystal stemware, and and “pillows made from Hermes scarves,” a former crew member told the NY Post.

Citigroup declined to comment on Weill’s trip.

Bertrand Russell

2009-01-31T17:19:00.000-08:00

“ The whole problem with the world is that fools and fanatics are always so certain of themselves, but wiser people so full of doubts.

— Bertrand Russell

Need for Lead Testing to Close Children’s Library

2009-01-31T08:19:00.000-08:00

The morons who passed this bill should be discovered and voted out of office. It’s idiotic.

Libraries may consider banning children instead of books in response to the Consumer Product Safety Improvement Act’s required lead testing, an option Garrett County librarian Cathy Ashby doesn’t want to consider.

“That would be one of the ways to comply with the law, but I have a feeling that there will be a lot of civil disobedience,” Ashby said of her concern that the new law may prevent children from accessing educational materials at Ruth Enlow Library in Oakland where she is the director.

The Consumer Product Safety Act was passed by Congress Aug. 14 in reaction to findings that some toys imported from China contained dangerous levels of lead. President Bush signed the legislation, which includes stricter limits on lead levels in children’s products.

The American Library Association said it fears the law has unintended consequences, and libraries may face the choice of closing their children’s sections, banning children under the age of 12 or completing expensive lead testing for every book.

Kierkegaard

2009-01-27T08:59:00.000-08:00

The most common form of despair is not being who you are.

Kierkegaard

Pilgrim's Pride Bankruptcy Causing Buffalo Wing Shortage, Superbowl Panic?

2009-01-26T21:12:00.000-08:00

The Dec. 1 Chapter 11 reorganization filing of Pilgrim's Pride Corp. of Pittsburgh, Texas, has reduced the nation's wing supply, Buffalo suppliers say.

Add to this the fact that national wing demand this time of year far exceeds that of other times, like chocolates around Valentine's Day.

The combination has made prices soar, suppliers say.

"Forty pounds (of wings) would be like $85," Sam Musolino, owner of Sammy's Pizzeria in nearby Niagara Falls, N.Y., tells WIVB-TV, Buffalo.

He used to pay only half that amount, he says.

Mr. Musolino is calling for a boycott of chicken wings in order to send a message that wing prices are too high.

Tragic.

Existing-home sales rise 6.5% as prices plunge

2009-01-26T09:05:00.000-08:00

Sales of existing homes rose 6.5% in December to a seasonally adjusted annualized rate of 4.74 million, led by a big rebound in the West where prices have fallen more than 30%, the industry trade group said. Sales in December were down 3.5% from the previous December.

About 45% of the transactions in December were considered distress sales, either a short sale or a home in foreclosure, the Realtors said. Many foreclosure sales are handled outside the Realtors' system and are not reported by the Realtors.

"Rising foreclosures and the large inventory overhang continue to exert downward pressure on prices," wrote Anna Piretti, an economist for BNP Paribas.

For 2008 as a whole, sales fell 13.1% to 4.91 million, the industry trade group said. November and December were the weakest sales months of the year on a seasonally adjusted basis as credit dried up.

The median sales price fell to $175,400 in December, down a record 15.3% compared with a year earlier. For all of 2008, median prices dropped 9.3% to $198,600, the lowest level since 2004.

The price decline is likely the largest since the Great Depression in the 1930s,

Indians flee Dubai as dreams crash

2009-01-23T16:52:00.000-08:00

Mumbai/DUBAI - JAN 14: It's the great escape by Indians who've hit the dead-end in Dubai.

Local police have found at least 3,000 automobiles -- sedans, SUVs, regulars -- abandoned outside Dubai International Airport in the last four months. Police say most of the vehicles had keys in the ignition, a clear sign they were left behind by owners in a hurry to take flight.

The global economic crisis has brought Dubai's economic progress, mirrored by its soaring towers and luxurious resorts, to a stuttering halt. Several people have been laid off in the past months after the realty boom started unraveling.

On the night of December 31, 2008 alone more than 80 vehicles were found at the airport. "Sixty cars were seized on the first day of this year," director general of Airport Security, Mohammed Bin Thani, told DNA over the phone. On the same day, deputy director of traffic, colonel Saif Mohair Al Mazroui, said they seized 22 cars abandoned at a prohibited area in the airport.

Faced with a cash crunch and a bleak future ahead, there were no goodbyes for the migrants -- overwhelmingly South Asians, mostly Indians - just a quiet abandoning of the family car at the airport and other places.

While 2,500 vehicles have been found dumped in the past four months outside Terminal III, which caters to all global airlines, Terminal II, which is only used by Emirates Airlines, had 160 cars during the same period.

Zale Corp (ZLC) loses the family jewels

2009-01-23T16:29:00.000-08:00

Zale hit the all-time low after news CFO Rodney Carter would be stepping down. Zale did not disclose a reason for the departure of CFO Rodney Carter, but said Controller Cindy Gordon will take over on an interim basis. Spokesman David Sternblitz said the company does not comment on personnel decisions but reiterated the change is not related to the company's accounting practices and financial statements.

Zale Corporation (Public, NYSE:ZLC), retailer of overpriced fine jewely, has hit an all time low on Wednesday, dropping to just $1.42 a share.

Talk about a stock you don’t want to have in your portfolio during struggling economic times.

Europe to Buy 30,000 Tons of Surplus Butter

2009-01-23T15:48:00.000-08:00

BRUSSELS — Two years after it was supposed to have gone away for good, Europe’s “butter mountain” is back.

Faced with a drastic drop in the price of dairy goods, the European Union will buy 30,000 tons of unsold butter — reviving one of the abiding symbols of Europe’s generous farm subsidy system.

While the butter sits in cold storage, more than three times that amount in skimmed milk powder will accumulate in warehouses on the European Union’s expense.

The collapse in the price of dairy products has also prompted officials to announce that they will resume subsidies for the export of a range of goods. Officials argue that, by historical standards, the purchase is insignificant. In 1986, the European Union bought 1.23 million tons of butter.

The latest figures show that 717,810 tons of cereals were piling up, along with 41,422 tons of sugar and 2.3 million hectoliters of wine, according to the European Commission.

Carlos Galian, agriculture expert for Oxfam International, said the resumption of export subsidies worried him.

“Once you start using export subsidies,” Mr. Galian said, “the E.U. opens the door to pressure from other groups to press for them. In terms of global trade negotiations, it does not give a good signal to developing countries.”

GMAC Wrote Only Nine Loans for AutoNation Customers in December

2009-01-23T15:35:00.001-08:00

GMAC Wrote Only Nine Loans for AutoNation Customers in December

How hard is it to get credit to buy a car?

Mike Jackson, CEO of AutoNation Inc. said the number of loans GM’s financing arm — GMAC LLC -– wrote for his customers fell to nine in December compared to 1,527 loans during the same month in 2007.

The number of Chrysler Financial loans to AutoNation customers dropped to 22 from 823. Ford was the only U.S. auto maker that continued to offer a significant number of loans. Ford Motor Credit made 1,235 written loans in December compared with 1,624 in December 2007.

“We need something big to happen in credit if we want to see car sales improve,” Mr. Jackson said.

AutoNation is the largest automotive retailer in the U.S. It owns and operates 313 new vehicle franchises in 15 states. –

Why is Deflation bad?

2009-01-22T20:38:00.000-08:00

Deflation is a broad based decline in the general price level of goods and services. This decline is both sustained, and constant. A temporary fall in the prices of goods and services does not constitute deflation.

So, that means that it makes sense for consumers to delay their purchases. If you can buy something tomorrow for a buck, you will not buy it today, for two.

The real trouble starts when tomorrow comes and you still don’t make the purchase, because you hope to get it even cheaper in a week.

This attitude causes a deflationary spiral and in theory can cause a free-fall in the demand of goods and services in an economy. That also means a free fall in prices and an even more contraction of the economy.

If you take this argument further, you will realize that by simply hoarding money; you are making it more valuable. If you save hundred dollars today; you will be able to buy much more with those hundred dollars tomorrow. This creates an incentive to hoard money and risk the stoppage of all economic activity.

That is why you see the Fed rushing to slash interest rates, when they fear deflation. If they slash interest rates, and you can’t get good returns on your Savings account; you will be forced to either spend or invest your money. This will again boost demand and help the economy come out of its downward spiral.

Good Deflation

There is such a thing as good deflation also. When price levels fall because of technological improvements; that boosts productivity and helps stimulate demand too. That was seen when the prices of cars or computers went down. When that happened; more and more people bought cars and computers and stimulated demand. This is an example of good deflation. However it is not broad based and does not occur in the entire economy.

Deflation and Unemployment

Due to the slack in demand and rise in real wages, businesses find it increasingly difficult to pay wages and keep people on their payrolls. This creates a situation of lay-offs and that further reduces demand. Another situation that creates a vicious circle.

Loan Defaults

As deflation rises the “price” of money increases and the price of assets decrease. So if you have taken a mortgage to buy a house, you will see your house price dropping constantly and the stuff your dollar can buy increase constantly.

Such an environment is really conducive for loan defaults and invariably a lot of debtors default on their loans. That further worsens the situation as there are more problems in the economy now.

Difficult to control

Deflation gets very difficult to control for central banks. They can only lower the interest to 0% and after that there is not much that they can do. It becomes hard to jump-start the economy and stimulate demand. Once, in deflation, countries tend to come out of it really slowly.

All these factors make deflation really undesirable and all attempts are made to keep the economy in moderate inflation.

The check isn't in the mail

2009-01-22T14:17:00.000-08:00

The check isn't in the mail, and it's not going to be for at least 30 days, California will start telling some of its creditors in February.

The state, facing a $42 billion deficit, will delay some crucial payments to stay liquid, state Controller John Chiang announced Friday.

Among those who will be left waiting for checks are thousands of businesses that provide services and products to the state; more than 1 million aged and disabled Californians who need to pay for rent, utilities or food; and individuals and businesses awaiting tax refunds to the tune of $1.91 billion.

While the state has too many issues to discuss in a single post, is California's debt still likely to be paid back? As seen below, the state's general obligation bonds have sold off significantly more than the index in recent months (peaking at the end of December).

Not to worry says Investor Nirav:

They asked the California state treasurer Bill Lockyer whether the California public debt was completely safe. “Absolutely, the only way we’re going to default is if there’s a thermonuclear war.”

So there’s no doubt that California will pay back the debt. In the worst case, the Federal Reserve would just bail the state out. If they’re willing to bail out car companies, I’m sure they’ll step in for California.

I agree... and I'll also agree with the article's obvious finishing comment.

But if there’s more bad news, the yields could go higher still, and the prices of the bonds could fall in value.

In other words, be prepared to face volatility / uncertainty in any investment in the current environment.

2009-01-22T14:14:00.001-08:00

Video - SNL Sketch: Straight Talk - Stock Market

2009-01-19T18:51:00.000-08:00

Straight Talk - Stock Market
Uploaded by senatork

Missing money manager believed alive:

2009-01-18T09:31:00.000-08:00

MIAMI (Reuters) – A missing Florida money manager is believed to be alive, his business associate said on Saturday as police investigated the possible disappearance of hundreds of millions of dollars from investment funds.

The family of Arthur Nadel, 75, a Sarasota, Florida, philanthropist and president of Scoop Management, Inc., reported him missing on Wednesday.

He left a note for his family that was characterized by a local newspaper as a suicide note. Police would not disclose its contents but said his family believed he was "distraught" at the time of his disappearance.

On Friday, Sarasota police launched an investigation, saying they had received complaints that "hundreds of millions of dollars" may have vanished from the funds Nadel managed.

Neil Moody, a Nadel business associate and the founder of a fund family that invested with Scoop, said Nadel has been in contact with Nadel's wife. He said he believed Nadel was still alive.

"At this point we have every indication that he is," Moody told Reuters, adding that he did not know where Nadel was.

"If we knew where he was, we'd be on him," Moody said.

The Florida investigation, which the Sarasota Herald-Tribune said could involve as much as $350 million, began just over a month after the arrest of New York money manager Bernard Madoff on charges he ran a giant $50 billion Ponzi scheme that shook the investment world.

The Madoff case rattled charities and wealthy families in Palm Beach on Florida's east coast. The Nadel allegations have struck hard in Sarasota, on the state's west coast, where the missing money manager was well-known in society circles and a prominent donor to local causes.

Moody's Valhalla Management said it contracted with Nadel's Sarasota-based Scoop Management to invest funds branded as Valhalla, Viking, and Viking IRA. The Herald-Tribune said Moody told investors in a statement this week that the funds may have "virtually no remaining value."

The paper said Moody had contacted the U.S. Securities and Exchange Commission and other authorities to report the situation.

In a statement issued on Saturday, Valhalla Management characterized Nadel's last message as a suicide note.

"It appears, however, that he is likely still at large. It also appears that he has engaged in improper and unauthorized activities," the statement said.

"The owners of Valhalla Management, who had contracted with Scoop Management to invest substantially all of Valhalla and related fund's assets, are cooperating with all local and federal authorities to determine exactly what happened."

VICTIMS CONTACT POLICE

Moody, who is also prominent in Sarasota social circles and active in causes ranging from the YMCA to the local symphony, was the founder of Valhalla Management and Viking Management, according to published reports.

Moody's lawyer, James Fox Miller of Boies, Schiller and Flexner, issued a brief statement via e-mail saying that Moody and his son, Christopher, were also victims of Nadel.

"Our clients Neil and Christopher Moody just learned that they, along with many others who invested monies with Arthur Nadel have been victimized by his unauthorized and inappropriate actions," it said.

Sarasota police said the investigation began on Friday after calls from at least five possible victims. Capt. Bill Spitler said many of the victims appeared to have lost $500,000 or more, some the majority of their life savings.

Other victims had come forward since news of Nadel's disappearance broke, Spitler said.

Geoff Quisenberry, Nadel's stepson, was quoted in the Herald-Tribune on Saturday as saying Nadel's family was not ready to comment on the allegations.

Results of the Obama Job Creation Act!

2009-01-17T21:55:00.001-08:00

Burton says RCR cars need more speed to compete

2009-01-17T20:10:00.000-08:00

We're striving for greatness here. We're not looking to be mediocre, we're striving for greatness [and] if we want to be analytical and understand what it is that we have to do better, then it's speed.
Jeff Burton

All right Madof

2009-01-14T20:01:00.000-08:00

A look inside hedge funds

2009-01-14T17:26:00.000-08:00

A look inside hedge funds from Marketplace on Vimeo.

Why 'bad banks' might be a good thing

2009-01-14T17:22:00.000-08:00

Why ‘bad banks’ might be a good thing from Marketplace on Vimeo.

Two More Retail Bankruptcies, Goody's And Gottschalks

2009-01-14T17:00:00.000-08:00

Two More Retail Bankruptcies, Goody's And Gottschalks

Gottschalks, a regional department store chain with 61 stores (most of them in California) has filed for Chapter 11 bankruptcy, but will continue to operate as usual. Goody's a clothing retailer that emerged from bankruptcy in October, however, has failed and will be liquidated.

Jan 14 (Reuters) - U.S. retailers Goody's and Gottschalks
(GOTT.PK) filed for Chapter 11 bankruptcy protection this week,
joining a growing list of store chains hit hard by a year-long
recession. [ID:nN14451342]

Restructuring experts see a wave of retail bankruptcies in
the coming months due to dismal sales and a credit crunch. Some
expect the largest U.S. chains will weather the storm better
than their local and regional rivals.

Here is a list of some U.S. retailers who have filed for
bankruptcy protection in recent months:

GOTTSCHALKS INC

The regional department store chain filed for Chapter 11
bankruptcy protection on Jan. 14. Based in Fresno, California,
the company said it had negotiated $125 million in
debtor-in-possession (DIP) financing from a group of lenders
led by GE Capital, a unit of General Electric Co (GE.N).

Gottschalks was founded in 1904 and operates 58 department
stores and three specialty apparel stores in the western United
States. It plans to pursue options that include the sale of the
company or another transaction.

GOODY'S LLC

Privately held family apparel retailer Goody's said in a
court filing on Jan. 13 that it again filed Chapter 11 and that
it plans to liquidate its remaining 282 stores.

The move comes less than three months after it emerged from
bankruptcy. The company said that a "significant downturn in
the national economy caused severe and unexpected financial
pressures." Goody's, based in Knoxville, Tennessee, was founded
in 1953 and operates in 20 U.S. states, mostly in the
Southeast.

CIRCUIT CITY STORES INC (CCTYQ.PK)

The No. 2 U.S. consumer electronics retailer filed for
bankruptcy on Nov. 10, becoming the largest retailer to file
for Chapter 11 since Kmart in 2002.

The 59-year-old retailer fell victim to tighter credit
terms from vendors, a dwindling cash position and decreased
consumer spending amid the deepening economic crisis.

On Jan. 9 the Richmond, Virginia-based company received
court approval to put itself up for sale and said it was in
talks with two parties that could either buy the chain or
provide additional financing. It did not name the parties.

Mexican retail and media entrepreneur Ricardo Salinas
Pliego has built up a stake of at least 28 percent in the
company. His spokesman said this week the tycoon was
considering a bid for Circuit City but would not say whether he
was one of the unidentified negotiating partners.

BOSCOV'S DEPARTMENT STORE LLC

Boscov's filed for Chapter 11 on Aug. 4. An investment
group led by Albert Boscov and Edwin Lakin bought the
family-owned chain in a $300 million deal that closed in
December.

The department store chain was founded in 1911 and had 39
locations on the U.S. East Coast.

Albert Boscov is the uncle of Boscov's Chief Executive Ken
Lakin and was previously chairman and chief executive of the
chain. Edwin Lakin is Ken Lakin's father.

MERVYN'S LLC

The department store chain filed for Chapter 11 on July 29
and in October said it would liquidate after the holiday season
after exhausting options that would allow it to stay open.

The privately held company operated 177 stores in the
Southwest at the time of its bankruptcy filing.

In 2004 Target Corp (TGT.N) sold Mervyn's to a private
investment company formed by affiliates of Sun Capital Partners
Inc, Cerberus Capital Management LP [CBS.UL] and Lubert-Andler
and Klaff Partners LP.

Cerberus sold out of the chain in 2007 but kept a 15
percent interest in its real estate holdings.

LINENS 'N THINGS [LNNHDL.UL]

Linens closed some of its 589 stores and filed for Chapter
11 on May 2. In October, the Clifton, New Jersey-based home
goods retailer began liquidating its remaining stores after it
failed to find a buyer.

The second-largest home goods retailer in North America,
bought by Leon Black's buyout firm Apollo Management in 2006,
is among the largest companies taken private in the recent
buyout boom to file for Chapter 11 bankruptcy protection.

KB TOYS INC

One of the largest U.S. toy retailers, KB filed Chapter 11
on Dec. 11, with a plan to close all of its stores and begin
liquidation in the middle of the holiday season.

The filing was the second in four years for the privately
held toy retailer, which started as a family-owned business in
1922 and ran about 460 stores when it made its most recent
filing.

The Pittsfield, Massachusetts-based company said it plans
to close all its stores across the United States, Guam and
Puerto Rico by early February.

Did Speculation Fuel Oil Price Swings?

2009-01-13T07:18:00.000-08:00

Watch CBS Videos Online

The Auto Bubble

2009-01-12T19:50:00.000-08:00

This created an environment in which the consumer could borrow more, but pay the same amount (i.e. cheap financing meant monthly payments stayed relatively flat after accounting for inflation).

This has unraveled in recent months as consumers not only realized they didn't need a new car every 30,000 miles, but they also found it difficult accessing cheap credit as lenders reigned in lending (i.e. GMAC refused to lend to any borrower with a FICO score under 700). The obvious result... auto sales collapsed, which in turn led to the GMAC bailout to pump the bubble back up (per PoAC):

At the start of last week, the U.S. Treasury bought $5 billion in GMAC stock and loaned GM $1 billion to invest in GMAC Financial Services LLC.

The next day, GMAC announced zero percent financing on some models of GM cars and doubled the number of potential buyers qualifying for loans.

Source: Federal Reserve

The Inmates Get Thinner And The Sheriff's Bank Account Gets Fatter

2009-01-09T14:04:00.000-08:00

Here's a grim economics lesson: In Alabama, there's a law that allows the Sheriff to keep any money that's left over after feeding the prisoners in the county jail. Can you guess what the result of this conflict of interest might be?

The prisoners in the Morgan County jail here were always hungry. The sheriff, meanwhile, was getting a little richer. Alabama law allowed it: the chief lawman could go light on prisoners’ meals and pocket the leftover change.

And that is just what the sheriff, Greg Bartlett, did, to the tune of $212,000 over the last three years, despite a state food allowance of only $1.75 per prisoner per day.
A typical breakfast was a few spoonfuls of grits, part of an egg and a piece of toast. If the prisoners wanted more food, they had to pay for it in the jail's store. Prisoners with no money got thinner... and thinner... while other prisoners spent as much as $100 a week on food.

The NYT says that the sheriff was jailed until he could come up with a plan to feed the prisoners more — and he did. He says he will no longer keep the money for himself and will spend it all on food.

And that's why it's important to try to avoid conflicts of interest... right, Wall Street?

Q: Why Aren't You Buying New Cars? A: There's Nothing Wrong With The Old Ones

2009-01-08T19:51:00.000-08:00

A Consumer Reports study says that the top three reasons people are delaying the purchase of a new car are:

1) The existing vehicle is still in good shape (39 percent)

2) Vehicles have become too expensive (30 percent)

3) General concern for the weak economy (30 percent)

Only 11% said they were concerned about losing their job, and 13% said they couldn't get financing. Among households making over $50,000 a year, financing was even less of an issue — only 8% cited it as the reason they were delaying a purchase.

The survey also found that about half of the country says they're going to delay a new car purchase. So, why aren't you buying a new car? Does this survey match your own experience? Do you even buy "new" cars?

Borrowing Dropped $7.9 Billion In November

2009-01-08T19:48:00.000-08:00

If there's one bright side to the current economic situation, it's that we seem to have finally stopped borrowing so much money. Bloomberg is reporting that consumer borrowing dropped by nearly $8 billion last November, the second month in a row and "the first back-to-back monthly decline since 1992."

"Consumer borrowing fell at a 3.7 percent annual rate in November, the biggest percentage decline since January 1998, the Fed said today. The decline in dollar terms was the biggest since records began in 1943."
"Revolving debt such as credit cards decreased by $2.8 billion."
"Non-revolving debt, including auto loans, dropped $5.2 billion for the month."

Is Chrysler a lost cause?

2009-01-07T20:01:00.000-08:00

Even by the standards of battered automakers, Chrysler is in dire shape. Its sales in December were down a stunning 53 percent, far worse than Ford or General Motors, and analysts say it probably won't survive the year as an independent company — despite $4 billion in government loans and the possibility of more.

Things were so bad last year that a single Toyota model, the Camry/Solara midsize car, outsold the entire fleet of Chrysler LLC's passenger cars.

Chrysler's chief financial officer has said the company needs $7 billion every 45 days to pay parts suppliers, and analysts question whether the company's meager sales are generating enough cash to make those payments.

Why GM Will Still Fail

2009-01-07T19:07:00.000-08:00

Senator Al Franken impersonating Mic Jagger

2009-01-07T19:00:00.000-08:00

What’s the Difference Between a Million, a Billion and a Trillion?

2009-01-07T17:32:00.000-08:00

A million seconds is 13 days.
A billion seconds is 31 years.
A trillion seconds is 31,688 years.

A million minutes ago was – 1 year, 329 days, 10 hours and 40 minute ago.
A billion minutes ago was just after the time of Christ.

A million hours ago was in 1885.
A billion hours ago man had not yet walked on earth.

A million dollars ago was five (5) seconds ago at the U.S. Treasury.
A billion dollars ago was late yesterday afternoon at the U.S. Treasury.

A trillion dollars is so large a number that only politicians
can use the term in conversation… probably because they
seldom think about what they are really saying. I’ve read that
mathematicians do not even use the term trillion!
Here is some perspective on TRILLION:

Trillion = 1,000,000,000,000.
The country has not existed for a trillion seconds.
Western civilization has not been around a trillion seconds.
One trillion seconds ago – 31,688 years – Neanderthals stalked the plains of Europe.

Million: 1,000,000
Billion: 1,000,000,000
Trillion: 1,000,000,000,000
Quintillion: 1,000,000,000,000,000,000
Sextillion: 1,000,000,000,000,000,000,000
Nonillion: 1,000,000,000,000,000,000,000,000,000,000
Centillion: 1 followed by 303 zeros

Sea Ice Ends Year at Same Level as 1979

2009-01-06T18:15:00.000-08:00

Rapid growth spurt leaves amount of ice at levels seen 29 years ago.

Thanks to a rapid rebound in recent months, global sea ice levels now equal those seen 29 years ago, when the year 1979 also drew to a close.

Ice levels had been tracking lower throughout much of 2008, but rapidly recovered in the last quarter. In fact, the rate of increase from September onward is the fastest rate of change on record, either upwards or downwards.

The data is being reported by the University of Illinois's Arctic Climate Research Center, and is derived from satellite observations of the Northern and Southern hemisphere polar regions.

Each year, millions of square kilometers of sea ice melt and refreeze. However, the mean ice anomaly -- defined as the seasonally-adjusted difference between the current value and the average from 1979-2000, varies much more slowly. That anomaly now stands at just under zero, a value identical to one recorded at the end of 1979, the year satellite record-keeping began.

Sea ice is floating and, unlike the massive ice sheets anchored to bedrock in Greenland and Antarctica, doesn't affect ocean levels. However, due to its transient nature, sea ice responds much faster to changes in temperature or precipitation and is therefore a useful barometer of changing conditions.

Earlier this year, predictions were rife that the North Pole could melt entirely in 2008. Instead, the Arctic ice saw a substantial recovery. Bill Chapman, a researcher with the UIUC's Arctic Center, tells DailyTech this was due in part to colder temperatures in the region. Chapman says wind patterns have also been weaker this year. Strong winds can slow ice formation as well as forcing ice into warmer waters where it will melt.

Why were predictions so wrong? Researchers had expected the newer sea ice, which is thinner, to be less resilient and melt easier. Instead, the thinner ice had less snow cover to insulate it from the bitterly cold air, and therefore grew much faster than expected, according to the National Snow and Ice Data Center.

In May, concerns over disappearing sea ice led the U.S. to officially list the polar bear a threatened species, over objections from experts who claimed the animal's numbers were increasing.

To All My Valued Employees,

2009-01-05T16:55:00.000-08:00

There have been some rumblings around the office about the future of this company, and more specifically, your job. As you know, the economy has changed for the worse and presents many challenges. However, the good news is this: The economy doesn't pose a threat to your job. What does threaten your job however, is the changing political landscape in this country.

However, let me tell you some little tidbits of fact which might help you decide what is in your best interests.

First, while it is easy to spew rhetoric that casts employers against employees, you have to understand that for every business owner there is a back story. This back story is often neglected and overshadowed by what you see and hear. Sure, you see me park my Mercedes outside. You've seen my big home at last years Christmas party. I'm sure; all these flashy icons of luxury conjure up some idealized thoughts about my life.

However, what you don't see is the back story.

I started this company 28 years ago. At that time, I lived in a 300 square foot studio apartment for 3 years. My entire living apartment was converted into an office so I could put forth 100% effort into building a company, which by the way, would eventually employ you.

My diet consisted of Ramen Pride noodles because every dollar I spent went back into this company. I drove a rusty Toyota Corolla with a defective transmission. I didn't have time to date. Often times, I stayed home on weekends, while my friends went out drinking and partying. In fact, I was married to my business -- hard work, discipline, and sacrifice.

Meanwhile, my friends got jobs. They worked 40 hours a week and made a modest $50K a year and spent every dime they earned. They drove flashy cars and lived in expensive homes and wore fancy designer clothes. Instead of hitting the Nordstrom's for the latest hot fashion item, I was trolling through the discount store extracting any clothing item that didn't look like it was birthed in the 70's. My friends refinanced their mortgages and lived a life of luxury. I, however, did not. I put my time, my money, and my life into a business with a vision that eventually, some day, I too, will be able to afford these luxuries my friends supposedly had.

So, while you physically arrive at the office at 9am, mentally check in at about noon, and then leave at 5pm, I don't. There is no "off" button for me. When you leave the office, you are done and you have a weekend all to yourself. I unfortunately do not have the freedom. I eat, and breathe this company every minute of the day. There is no rest. There is no weekend. There is no happy hour. Every day this business is attached to my hip like a 1 year old special-needs child. You, of course, only see the fruits of that garden -- the nice house, the Mercedes, the vacations... you never realize the back story and the sacrifices I've made.

Now, the economy is falling apart and I, the guy that made all the right decisions and saved his money, have to bail-out all the people who didn't. The people that overspent their paychecks suddenly feel entitled to the same luxuries that I earned and sacrificed a decade of my life for.

Yes, business ownership has is benefits but the price I've paid is steep and not without wounds.

Unfortunately, the cost of running this business, and employing you, is starting to eclipse the threshold of marginal benefit and let me tell you why:

I am being taxed to death and the government thinks I don't pay enough. I have state taxes. Federal taxes. Property taxes. Sales and use taxes. Payroll taxes. Workers compensation taxes. Unemployment taxes. Taxes on taxes. I have to hire a tax man to manage all these taxes and then guess what? I have to pay taxes for employing him. Government mandates and regulations and all the accounting that goes with it, now occupy most of my time. On Oct 15th, I wrote a check to the US Treasury for $288,000 for quarterly taxes. You know what my "stimulus" check was? Zero. Nada. Zilch.

The question I have is this: Who is stimulating the economy? Me, the guy who has provided 14 people good paying jobs and serves over 2,200,000 people per year with a flourishing business? Or, the single mother sitting at home pregnant with her fourth child waiting for her next welfare check? Obviously, government feels the latter is the economic stimulus of this country.

The fact is, if I deducted (Read: Stole) 50% of your paycheck you'd quit and you wouldn't work here. I mean, why should you? That's nuts. Who wants to get rewarded only 50% of their hard work? Well, I agree which is why your job is in jeopardy.

Here is what many of you don't understand ... to stimulate the economy you need to stimulate what runs the economy. Had suddenly government mandated to me that I didn't need to pay taxes, guess what? Instead of depositing that $288,000 into the Washington black-hole, I would have spent it, hired more employees, and generated substantial economic growth. My employees would have enjoyed the wealth of that tax cut in the form of promotions and better salaries. But you can forget it now.

When you have a comatose man on the verge of death, you don't defibrillate and shock his thumb thinking that will bring him back to life, do you? Or, do you defibrillate his heart? Business is at the heart of America and always has been. To restart it, you must stimulate it, not kill it. Suddenly, the power brokers in Washington believe the poor of America are the essential drivers of the American economic engine. Nothing could be further from the truth and this is the type of change you can keep.

So where am I going with all this?

It's quite simple.

If any new taxes are levied on me, or my company, my reaction will be swift and simple. I fire you. I fire your co-workers. You can then plead with the government to pay for your mortgage, your SUV, and your child's future. Frankly, it isn't my problem any more.

Then, I will close this company down, move to another country, and retire. You see, I'm done. I'm done with a country that penalizes the productive and gives to the unproductive. My motivation to work and to provide jobs will be destroyed, and with it, will be my citizenship.

So, if you lose your job, it won't be at the hands of the economy; it will be at the hands of a political hurricane that swept through this country, steamrolled the constitution, and will have changed its landscape forever. If that happens, you can find me sitting on a beach, retired, and with no employees to worry about....

Signed,
Your boss

Man Can **FLY

2009-01-05T10:34:00.000-08:00

wingsuit base jumping from Ali on Vimeo.

What Is Quantitative Easing?

2009-01-05T07:14:00.000-08:00

Quantitative easing from Marketplace on Vimeo.

Jean-Luc Godard

2009-01-04T21:03:00.001-08:00

“ Nothing is original. Steal from anywhere that resonates with inspiration or fuels your imagination. Devour old films, new films, music, books, paintings, photographs, poems, dreams, random conversations, architecture, bridges, street signs, trees, clouds, bodies of water, light and shadows. Select only things to steal from that speak directly to your soul. If you do this, your work (and theft) will be authentic. Authenticity is invaluable; originality is non-existent. And don’t bother concealing your thievery - celebrate it if you feel like it. In any case, always remember what Jean-Luc Godard said: “It’s not where you take things from - it’s where you take them to.

2009-01-04T20:58:00.000-08:00

The $103,000 shack: a perfect explanation of why housing is a mess

2009-01-04T10:42:00.000-08:00

What's The Difference Between Money Market Accounts And Money Market Funds?

2009-01-04T09:41:00.001-08:00

This year, many investors learned the hard way the difference between a money market account and a money market fund. Do you know the difference?

A money market account is a type of deposit account. Much like its siblings, the checking and savings account, a money market account is FDIC insured, your principal is guaranteed, and you open one at a regular bank. It's like a hybrid checking and savings account because it earns interest like a savings account but you can write checks against it, often three to six times a month. You can withdraw your money whenever you like and the interest rate can change at any time.

A money market fund is a mutual fund. It is not FDIC insured, your principal is not guaranteed, and it is a security, you buy it through a broker. Technically, it's just like any other mutual fund. What makes a mutual fund a money market fund is what it invests in. Money market funds invest in supposedly "safe" investments like bonds and short term commercial paper, also known as "the money market."

For the longest time, everyone assumed that money market funds would never "break the buck," which is when the share price fall under $1 a share. That assumption was never tested until this year. When Lehman Brothers failed, its bonds failed and money market funds holding these assets lost a tremendous amount of money. The government eventually stepped in and prevented them from falling under $1/share but they didn't have to; a money market fund is an investment and investments are risky.

With online banks offering extremely high interest rates, the speed and simplicity of ACH transfers, and 6% APY reward checking accounts, I don't know why money market accounts still exist. Money market funds, on the other hand, still have value because you can find tax-exempt or tax-advantaged funds. They are especially appealing in a higher tax bracket because the tax equivalent yield can often beat other "safe" investments.

“Heaven’s Means of Communication”

2009-01-02T16:41:00.000-08:00

A Commentary on the Sabbath School Lesson for December 27, 2008-January 2, 2009, “Heaven’s Means of Communication”

1. Heaven's Means of Communication

Cashing In On The Blago Scandal

2008-12-31T15:23:00.000-08:00

What’s Your New Year’s Resolution?

2008-12-31T08:37:00.000-08:00

Was the 'Credit Crunch' a Myth Used to Sell a Trillion-Dollar Scam?

2008-12-30T11:19:00.000-08:00

Even as the media continue to repeat the claim that credit has frozen up, evidence has emerged suggesting the entire story is wrong.

There is something approaching a consensus that the Paulson Plan -- also known as the Troubled Asset Relief Program, or TARP -- was a boondoggle of an intervention that's flailed from one approach to the next, with little oversight and less effect on the financial meltdown.

even more troubling than the ad hoc nature of its implementation is the suspicion that has recently emerged that TARP -- hundreds of billions of dollars worth so far -- was sold to Congress and the public based on a Big Lie.

Bush said that if Congress didn't give Treasury Secretary Hank Paulson the trillion dollars (give or take) for which he was asking, the results would be disastrous: "Even if you have good credit history, it would be more difficult for you to get the loans you need to buy a car or send your children to college. And ultimately, our country could experience a long and painful recession."

For the most part, the press has continued to echo Bush's central assertion that there's a "credit crunch" preventing even qualified borrowers -- that's the key point -- from getting loans, and it's now part of the conventional wisdom.

a number of economists are questionioning the factual basis of the credit crunch narrative. Columnist David Sirota recently looked at those claims and concluded that Americans "had been punk'd" -- that "the major claims about a credit crisis that justified Congress cutting a trillion-dollar blank check to Wall Street were demonstrably false," and the threat of a systemic banking crash was used by the Bush administration to overcome popular resistance to the "bailout."

no one disputes the fact that as the economy has tanked, the number of new loans being issued to American families and businesses has plummeted. But is because credit has dried up for qualified borrowers?

Economist Dean Baker doesn't think so. He explains the situation in simple terms: The media, he argues, "are blaming the economic collapse on a 'credit crunch' instead of the more obvious problem that consumers just lost $6 trillion of housing wealth and another $8 trillion of stock wealth." It's a commonsense argument: much of the economic growth of the Bush era existed on paper only, built on the rise of a massive bubble in real estate values rather than growth in productive industries. When all that ephemeral wealth vaporized -- and with the economy shedding jobs like a dog with dermatitis -- consumers stopped buying, and businesses, anticipating a long slowdown, stopped seeking the loans that they might have otherwise tapped to expand their operations.

Is the Credit Crunch a Big Lie?

There's plenty of evidence that even though mortgage rates have plummeted, the number of applications for new loans has dropped to very low levels and argues it's "the most glaring refutation of the claim that people are unable to get credit." If creditworthy applicants were being denied loans by banks unable or unwilling to lend, Baker explains, "then the ratio of mortgage applications to home sales should be soaring" as qualified homebuyers apply to multiple banks for a loan. "Since there is no notable increase in this ratio, access to credit is obviously not an issue."

Again, this is common sense. Consumer spending drives about 70 percent of the U.S. economy, and in recent years, much of that spending was financed by people taking chunks of home equity out of their properties -- people might have been eating in fancy restaurants, but they were essentially eating their living rooms to do so.

That the American people don't have the appetite to go deeper into debt than they already are in order to make new purchases is hard to dispute. In November, consumer prices across the board fell at a record rate for the second month in a row. And even with mortgage rates plummeting, so many homeowners are "underwater" -- owing more on their homes than they're worth -- that they're unable to refinance because the equity isn't there. Paul Schuster, a vice president at Marketplace Home Mortgage, told the St. Paul Pioneer Press, "What I'm really concerned about is the job picture ... If (people) don't feel good about their jobs, rates aren't going to matter."

The National Federal of Independent Business' November survey of small-business owners found no evidence of a credit crunch to date, concluding that if "credit is going untapped, it's largely because company operators are not choosing to pursue the credit. It's not that companies can't get the extra money, it's that they don't want or need it because of the broader slowdown in economic activity."

researchers found that "interbank lending is healthy" and "bank credit has not declined during the financial crisis"; that they've seen "no evidence that the financial crisis has affected lending to non-financial businesses" and that "while commercial paper issued by financial institutions has declined, commercial paper issued by non-financial institutions is essentially unchanged during the financial crisis." The researchers called on lawmakers to "articulate the precise nature of the market failure they see, [and] to present hard evidence that differentiates their view of the data from other views."

That finding was backed up by a study issued by Celent Financial Services, a consulting firm, again using the Treasury Department's own data. According to a story on the report by Reuters, Celent's researchers concluded that the "data actually suggest world credit markets are functioning remarkably well." Rather than a widespread banking problem, Celent found that the rot was limited to "a few big, vocal banks and industries such as car manufacturing, which would be in difficulty anyway."

It's also the case that single-cause explanations for complex crises usually fail to hit the mark. Banks, having fueled the housing bubble (and similar bubbles before that) with the creation of ever-shadier "exotic" securities, are probably erring on the side of caution in writing new loans. They're looking at their balance sheets as quarterly reports approach, and the number of foreign investment dollars coming into the U.S. has declined, meaning that some qualified firms may, indeed, have trouble raising cash in the near future.

But one thing is clear: the economic crisis may have woken up Washington's political class when it hit the banks, but it remains a product of long-term imbalances in the economy, and the idea that it's primarily a pathology of the banking system in isolation is a misdiagnosis that, if uncorrected, can only result in a longer, deeper and more painful recession than might otherwise be the case.

Princeton Physicist Calls Global Warming Science "Mistaken"

2008-12-29T13:25:00.001-08:00

Scientist fired by Al Gore was told, "science will not intrude on public policy".

Noted energy expert and Princeton physicist Dr. Will Happer has sharply criticized global warming alarmism. Happer, author of over 200 scientific papers and a past director of energy research at the Department of Energy, called fears over global warming "mistaken".

"I have spent a long research career studying physics that is closely related to the greenhouse effect", said Happer. "Fears about man-made global warming are unwarranted and are not based on good science."

Dr. Happer views climate change as a predominately natural process. "The earth's climate is changing now, as it always has. There is no evidence that the changes differ in any qualitative way from those of the past."

In 1991, Happer was appointed director of energy research for the US Department of Energy. In 1993, he testified before Congress that the scientific data didn't support widespread fears about the dangers of the ozone hole and global warming, remarks that caused then-Vice President Al Gore to fire him. "I was told that science was not going to intrude on public policy", he said. "I did not need the job that badly".

Happer's latest remarks were made yesterday, as he asked to be included in a Senate Environment and Public Works report of scientists disputing global warming alarmism. Happer joins 650 other scientists on the list, many of whom have been interviewed previously by DailyTech.

"Computer models used to generate frightening scenarios from increasing levels of carbon dioxide have scant credibility," Happer concluded.

In response to Happer's remarks, Senator James Inhofe, ranking minority member of the Environment and Public Works Committee, said, "The endless claims of a consensus on man-made global warming grow less and less credible every day".

After the Bailout, UAW Owns and Operates Money Hemorrhaging Golf Retreat

2008-12-29T12:47:00.000-08:00

The United Auto Workers may be out of the hole now that President Bush has approved a $17 billion bailout of the U.S. auto industry, but the union isn’t out of the bunker just yet. Even as the industry struggles with massive losses, the UAW brass continue to own and operate a $33 million lakeside retreat in Michigan, complete with a $6.4 million designer golf course. And it’s costing them millions each year.

The UAW, known more for its strikes than its slices, hosts seminars and junkets at the Walter and May Reuther Family Education Center in Onaway, Mich., which is nestled on “1,000 heavily forested acres” on Michigan’s Black Lake, according to its Web site. But the Black Lake club and retreat, which are among the union’s biggest fixed assets, have lost $23 million in the past five years alone, a heavy albatross around the union’s neck as it tries to manage a multibillion-dollar pension plan crisis. Critics call it a resort for union leaders that wastes money from union dues. “It’s their members’ money that they’re spending on this thing,” said Justin Wilson, managing director of the Center for Union Facts, a union watchdog group. “The union has bigger issues at hand than managing a golf course.”

15-Year Old Cartoon Predicts the Future

2008-12-28T16:54:00.000-08:00

Click on image for larger view

Former Treasury Secretary Says He "Forgot" That People Had To "Afford Their House"

2008-12-22T09:57:00.000-08:00

Former Treasury Secretary John W. Snow has told the New York Times that he, along with the entire Bush Administration, simply "forgot" that people had to be able to "afford their house."

One of the main goals of the Bush Administration has always been to increase homeownership among Americans — a fantastic goal — but there was apparently one small flaw in the plan...

From the New York Times:

“The Bush administration took a lot of pride that homeownership had reached historic highs,” Mr. Snow said in an interview. “But what we forgot in the process was that it has to be done in the context of people being able to afford their house. We now realize there was a high cost.”

This seems like an odd thing to forget... especially for someone as accomplished as Mr. Snow. From 2003 - 2006, he served as the 73rd United States Secretary of the Treasury. Previous to that appointment he worked in the Reagan Administration and earned a Ph.D. in Economics from the University of Virginia. He's currently serving as chairman of Cerberus Capital Management, which among other things, owns 80% of Chrysler.

White House Philosophy Stoked Mortgage Bonfire [NYT]

Breach of Trust

2008-12-15T19:52:00.000-08:00

The question now is how will American capitalism change? for the worse. Reading the accounts of the collapse of Bernard L. Madoff Investment Securities, it is impossible not to conclude that it will. The scale of this fraud stretches far Among the victims of Madoff's extraordinary pyramid scheme are major banks (BNP Parisbas, Nomura Securities), famous people (Mort Zuckerman), and Madoff's friends from the Palm Beach Country Club. In the wake of Madoff's arrest, charities are going to close, and previously rich people will become poor. Worst of all, everyone who invests anywhere will think just that much harder, take that much longer, demand that much more documentation. And they will do so not only because of Madoff, but because of the subprime lenders, Wall Street investment banks, and Enron fraudsters who have worked so hard to erode our faith in the reliability of our system.

The deeper irony here is that all these schemes were only possible in the first place precisely because we have, until now, lived in a culture with such extraordinarily high levels of trust, a culture in which a customer's bona fides are accepted without question and wealthy people are thought to have earned their money. In our culture, someone like Madoff was trusted precisely because he was rich; because he was a member of the Palm Beach Country Club; because his company worked out of expensive Manhattan offices, most of which were occupied by people doing real jobs. It occurred to no one that a small group of select insiders was also operating a massive fraud scheme on the 17th floor.

In other cultures—maybe most other cultures—very rich people are suspect by definition. Recently, I met a wealthy Russian and automatically assumed he was the beneficiary of some shady scheme: How else would someone from that part of the world get rich? In fact, he turned out to be the CEO of a Western-owned company in Kiev, Ukraine, and totally above board. But I know why I made the mistake: I still remember—and Russians still remember—the fraudulent "privatization" deals and complex money-laundering operations that created so many Russian billionaires over the last two decades. I also remember the extraordinary saga of the MMM company, which in the 1990s defrauded some 2 million Russians of $1.5 billion, using what will now surely be known as the second-largest pyramid scheme of all time. Back then, we thought such blatant fraud could only take place in the lawlessness of the post-Soviet world.

We were wrong. Madoff's pyramid scheme, far broader than anything MMM dreamed up, was made possible by our own tradition of lawfulness. And now he will help bring that tradition down. Here's a prediction: In the coming years, American capitalism will become slower, more cautious, less productive, and less entrepreneurial. We're still a long way from Eastern Europe of the 1990s or from the Latin America or Russia of the present. But maybe not as far as we think.

40 Inspirational Speeches in 2 Minutes

2008-12-14T21:33:00.001-08:00

Pay raise for judges tucked into bailout plan

2008-12-11T08:56:00.000-08:00

WASHINGTON – If the $14 billion bailout plan for U.S. automakers passes, it will help more than just Ford, Chrysler and General Motors. Federal judges would get a pay raise, as well.

The raise — an annual cost of living adjustment, or COLA — would bring U.S. District court judges up to par with members of Congress, who will receive an almost $5,000 boost on Jan. 1. District judges and lawmakers now earn $169,300 a year but are expected to be awarded a 2.8 percent raise next year, said Dick Carelli, a spokesman for the Administrative Office of the United States Courts.

Senate Majority Leader Harry Reid, D-Nev., insisted that the judicial pay raise go into the automaker loan measure, which is the only item of business on Congress' lame-duck agenda

Why not a $5000.00 pay cut to all government employees who make over $150,000 a year as redistribution of wealth back to the tax payers or to help fund the 'BAILOUT'

We are The Big Three. We Don’t Need to Compete.

2008-12-10T22:32:00.001-08:00

The last thing we need is a Clinton in charge of foreign policy.

2008-12-09T20:35:00.000-08:00

It was apt in a small way that the first endorser of Hillary Rodham Clinton for secretary of state should have been Henry Kissinger. The last time he was nominated for any position of responsibility—the chairmanship of the 9/11 commission—he accepted with many florid words about the great honor and responsibility, and then he withdrew when it became clear that he would have to disclose the client list of Kissinger Associates
It is possible that the Senate will be as much of a club as the undistinguished fraternity/sorority of our ex-secretaries of state, but even so, it's difficult to see Sen. Clinton achieving confirmation unless our elected representatives are ready to ask a few questions about conflict of interest along similar lines. And how can they not? The last time that Clinton foreign-policy associations came up for congressional review, the investigations ended in a cloud of murk that still has not been dispelled. Former President Bill Clinton has recently and rather disingenuously offered to submit his own foundation to scrutiny (see the work of my Vanity Fair colleague Todd Purdum on the delightful friends and associates that Clinton has acquired since he left office), but the real problem is otherwise. Both President and Sen. Clinton, while in office, made it obvious to foreign powers that they and their relatives were wide open to suggestions from lobbyists and middlemen.
Just to give the most salient examples from the Clinton fundraising scandals of the late 1990s: The House Committee on Government Reform and Oversight published a list of witnesses called before it who had either "fled or pled"—in other words, who had left the country to avoid testifying or invoked the Fifth Amendment to avoid self-incrimination. Some Democratic members of the committee said that this was unfair to, say, the Buddhist nuns who raised the unlawful California temple dough for then-Vice President Al Gore, but however fair you want to be, the number of those who found it highly inconvenient to testify fluctuates between 94 and 120. If you recall the names John Huang, James Riady, Johnny Chung, Charlie Trie, and others, you will remember the pattern of acquired amnesia syndrome and stubborn reluctance to testify, followed by sudden willingness on the part of the Democratic National Committee to return quite large sums of money from foreign sources. Much of this cash had been raised at political events held in the public rooms of the White House, the sort of events that featured the adorable Roger Tamraz, for another example.
Related was the result of a House select committee on Chinese espionage in the United States and the illegal transfer to China of advanced military technology. Chaired by Christopher Cox, R-Calif., the committee issued a report in 1999 with no dissenting or "minority" signature. It found that the Clinton administration's attitude toward Chinese penetration had been abysmally lax (as lax, I would say, as its attitude toward easy money from businessmen with Chinese military-industrial associations).
Many quids and many quos were mooted by these investigations (still incomplete at the time of writing) though perhaps not enough unambivalent pros. You can't say that about the Marc Rich and other pardons—the vulgar bonanza with which the last Clinton era came to an end. Rich's ex-wife, Denise Rich, gave large sums to Hillary Clinton's re-election campaign and to Bill Clinton's library, and Marc Rich got a pardon. Edgar and Vonna Jo Gregory, convicted of bank fraud, hired Hillary Clinton's brother Tony and paid him $250,000, and they got a pardon. Carlos Vignali Jr. and Almon Glenn Braswell paid $400,000 to Hillary Clinton's other brother, Hugh, and, hey, they, respectively, got a presidential commutation and a presidential pardon, too. In the Hugh case, the money was returned as being too embarrassing for words (and as though following the hallowed custom, when busted or flustered, of the Clinton-era DNC). But I would say that it was more embarrassing to realize that a former first lady, and a candidate for secretary of state, was a full partner in years of seedy overseas money-grubbing and has two greedy brothers to whom she cannot say no.

Does this sibling and fraternal squalor have foreign-policy implications, too? Yes. Until late 1999, the fabulous Rodham boys were toiling on another scheme to get the hazelnut concession from the newly independent republic of Georgia. There was something quixotically awful about this scheme—something simultaneously too small-time and too big-time—but it also involved a partnership with the main political foe of the then-Georgian president (who may conceivably have had political aspirations), so once again the United States was made to look as if its extended first family were operating like a banana republic.

China, Indonesia, Georgia—these are not exactly negligible countries on our defense and financial and ideological peripheries. In each country, there are important special interests that equate the name Clinton with the word pushover. And did I forget to add what President Clinton pleaded when the revulsion at the Rich pardons became too acute? He claimed that he had concerted the deal with the government of Israel in the intervals of the Camp David "agreement"! So anyone who criticized the pardons had better have been careful if they didn't want to hear from the Anti-Defamation League. Another splendid way of showing that all is aboveboard and of convincing the Muslim world of our evenhandedness.

In matters of foreign policy, it has been proved time and again, the Clintons are devoted to no interest other than their own. A president absolutely has to know of his chief foreign-policy executive that he or she has no other agenda than the one he has set. Who can say with a straight face that this is true of a woman whose personal ambition is without limit; whose second loyalty is to an impeached and disbarred and discredited former president; and who is ready at any moment, and on government time, to take a wheedling call from either of her bulbous brothers? This is also the unscrupulous female who until recently was willing to play the race card on President-elect Obama and (in spite of her own complete want of any foreign-policy qualifications) to ridicule him for lacking what she only knew about by way of sordid backstairs dealing. What may look like wound-healing and magnanimity to some looks like foolhardiness and masochism to me.

Leveraging?

2008-12-09T18:30:00.001-08:00

Leveraging and deleveraging from Marketplace on Vimeo.

2008-12-08T18:48:00.000-08:00

old photograph

2008-12-08T18:24:00.000-08:00

Most people who look at this old photograph will probably see a large bearded head between the two figures. It looks like an image of Jesus.

You’ll probably think it’s just a crude hoax from bygone days. But look again, carefully. This is not a hoax at all. What the photo actually shows is a child sitting on the man’s knee.

Block out the head’s “hair.” That’s just a collection of foliage in the background. The “eye” is the face the child, shadowed by a large white bonnet. The “nose” is the sleeve of the child’s shirt. And the “mustache” is the child’s arm, bent at the elbow.

Be patient. It may take you a while to see this.