"History is a wonderful thing, if only it was true"

Sunday, June 20, 2010

Doomsday averted ... for now

Author of Gloom, Boom & Doom Report" is between boom and doom ... I think

EU Debt Crisis - Government Expanded 'Like a Cancer': Marc Faber - CNBC:

"Governments have intervened too much in free markets since the crisis started, to the point that they are affecting the health of the world economy, Marc Faber, the author of 'The Gloom, Boom & Doom Report' told CNBC Thursday."

Saturday, June 19, 2010

Swinging too far the other way?

If GW Bush, aka "43" was too much Texan, too much swagger, have we swung too far the other way?

Dorothy Rabinowitz: The Alien in the White House - WSJ.com:

"How then might we be permitted to describe our enemies? One hint comes from another of Mr. Brennan's pronouncements in that speech: That 'violent extremists are victims of political, economic and social forces.'"

Friday, June 18, 2010


Not only are taxes set to go up on CapGains and Dividends, corporations themselves are at risk

FT.com / Columnists / John Gapper - Oil has become the new tobacco:

"Other companies may look at all this and believe that they and their investors are liability-free because they have not spilled oil in the gulf, sold cigarettes, made cars that do not brake or constructed synthetic collateralised debt obligations.

That would be a mistake. Many of S&P’s dividend aristocrats rely on the goodwill of consumers and politicians to keep accumulating cash for payouts. The mood following the bail-out of Wall Street is now so hostile to corporations, and public budgets so strained, that any slip would make them vulnerable.

Robert Reich, the former US labour secretary who wants the US government to put BP into temporary receivership although many of its investors are UK-based, defines the affair as a “contest between citizenship interests and shareholder interests”."

Wednesday, June 16, 2010

Ongoing comments on Banking

Better than tying compensation to share performance, tie personal wealth to bank risk profile.

FT.com / Columnists / GillianTett - Ideas on curbing bankers’ appetite for risk:

"America’s vision of capitalism has tended to assume that the best way to run efficient companies is to give top executives incentives to maximise shareholder value, by linking pay to share prices.

But even if that creed works for non-financial companies, there is a basic problem with applying this principle to banks. The average non-financial company is composed of 60 per cent equity and 40 per cent debt. But at banks, leverage has been so high that debt can account for 95 per cent of value, and equity only 5 per cent.

Thus, if bank executives focus only on equity prices – say, by raising profits – but have less incentive to protect the long-term value of debt – most notably by creating a stable business – that creates a mismatch, particularly since bank debt is typically protected by governments. Or as a paper* recently co-authored by Mr Mehran says: “Structuring CEO incentives to maximise shareholder value in a levered form tends to encourage excess risk-taking.” Hence the credit boom."

Now THIS is long term thinking

The Singularity is posited as the point where evolution jumps from carbon based systems to silicon based (computers pass humans).

Derived from this paper : Vernor Vinge on the Singularity (1993)

In the Singularity Movement, Humans Are So Yesterday - NYTimes.com

"...the Singularity — a time, possibly just a couple decades from now, when a superior intelligence will dominate and life will take on an altered form that we can’t predict or comprehend in our current, limited state.

At that point, the Singularity holds, human beings and machines will so effortlessly and elegantly merge that poor health, the ravages of old age and even death itself will all be things of the past."

Wednesday, June 09, 2010

A paean to learning how to learn

A Classical Education: Back to the Future - Opinionator Blog - NYTimes.com:

"“Classical content” identifies just what the subjects to be classically studied are. They are the subjects informed and structured by “the ideas that make us human” — math, science, language, history, economics and literature, each of which, Bortins insists, can be mastered by the rigorous application of the skills of the classical Trivium, grammar, the study of basic forms, logic, the skill of abstracting from particulars and rhetoric, the ability to “speak and write persuasively and eloquently about any topic while integrating allusions and examples from one field of study to explain a point in another.”"

What happens if you disregard traditional Economics?

Sometimes you find sensible answers.

Blog Prophet of Euro Zone Doom - NYTimes.com:

"“Why haven’t these countries converged” with the rest of Europe? he asks. “It’s demographics. As populations age, there are fewer people in their 20s to 40s to buy new houses, so they save more. The younger a country is, the more dependent it is on credit to get growth.”

Germany, where the average age is 45 and rising even as the population is beginning to shrink, is a nation of savers, and public policy has encouraged keeping wages under control and building up export industries.

By contrast, the younger Greeks, Irish and Spaniards went on borrowing binges, driven in particular by rising demands for new homes and consumer goods that, in several cases, turned into housing bubbles before going bust. Wages were pushed up, encouraging spending but soon making it all but impossible for their industries to compete with the thrifty Germans, Dutch and other Northern Europeans.

Most economists, beholden as they are to their “promiscuous but essentially useless” economic models, Mr. Hugh rails, missed what he considers an easily predictable outcome. And that, he adds, “is why we are in such a big mess now.”"

File under WTF?

Prepare to address the broken well, but not really.
We'll suck up all the oil ... whoops, maybe not.

Backlash Mounts on Spill - WSJ.com:

"U.S. officials said Tuesday that BP PLC was collecting so much oil from its broken well a mile under the Gulf of Mexico that it didn't have a big enough boat to hold it—the latest in a series of miscalculations stoking a political backlash against BP and the global oil industry."

Tuesday, June 08, 2010

I'll drink to that

Growing popularity :

New Whisky Distilleries Rising Up in Scotland - WSJ.com

Taking matters into one's own hands

Got in over your head?
Well, just don't pay.

Want to lend money to these folks?
Nope ...

For Some Homeowners in Foreclosure, a Rent-Free Approach - NYTimes.com:

"A growing number of the people whose homes are in foreclosure are refusing to slink away in shame. They are fashioning a sort of homemade mortgage modification, one that brings their payments all the way down to zero. They use the money they save to get back on their feet or just get by.

This type of modification does not beg for a lender’s permission but is delivered as an ultimatum: Force me out if you can. Any moral qualms are overshadowed by a conviction that the banks created the crisis by snookering homeowners with loans that got them in over their heads."

Might a bigger fish?

Eat BP?

Dealbook Column - Imagining the Worst in BP’s Future - NYTimes.com

"The idea that BP might one day file for bankruptcy, particularly as part of a merger that would enable it to cordon off its liabilities from the spill, is starting to percolate on Wall Street. Bankers and lawyers are already sizing up potential deals (and counting their potential fees).

Given the plunge in BP’s share price — the company has lost more than a third of its value since Deepwater Horizon blew — some bankers and analysts say BP is starting to look like takeover bait. The question is, who would buy BP, given its enormous potential liabilities?

Shell and Exxon Mobil are both said to be licking their chops. And already, flinty legal minds are dreaming up scenarios in which BP would file a prepackaged bankruptcy and separate the costs of the cleanup — and potentially billions of dollars in legal claims — into a separate corporate entity."

Like I'm suprised

Data Used to Justify Health Savings Effort Is Sometimes Shaky - NYTimes.com:

"Even Dartmouth’s claims about which hospitals and regions are cheapest may be suspect. The principal argument behind Dartmouth’s research is that doctors in the Upper Midwest offer consistently better and cheaper care than their counterparts in the South and in big cities, and if Southern and urban doctors would be less greedy and act more like ones in Minnesota, the country would be both healthier and wealthier.

But the real difference in costs between, say, Houston and Bismarck, N.D., may result less from how doctors work than from how patients live. Houstonians may simply be sicker and poorer than their Bismarck counterparts."

Friday, June 04, 2010

This is ... OLD

Compuserve !

note : don't try to contact me, none of the addresses nor numbers are current

More Joy

More on responsibility ... it's not mine, must be someone else's.

"The Union makes us strong"

Review & Outlook: The Union Pension Bailout - WSJ.com:

"Feeling tapped out after stimulus, ObamaCare and everything else? Senator Bob Casey has one more deal for you. If the Pennsylvania Democrat gets his way, U.S. taxpayers will also pick up the astonishing tab for poorly managed union pension plans.

Mr. Casey is gathering support for his curiously named 'Create Jobs and Save Benefits Act,' a bailout for union-run retirement plans. Similar to House legislation from North Dakota Democrat Earl Pomeroy and Ohio Republican Patrick Tiberi, the bill would transfer tens of billions of dollars worth of retiree liabilities to the Pension Benefit Guaranty Corporation, i.e., to taxpayers."

Free Lunch

Well, in an entitlement society, we shouldn't be too surprised

For Some Homeowners in Foreclosure, a Rent-Free Approach - NYTimes.com

Really makes one proud to be an American ... not