Admittedly, I have been in a state of heightened agitation lately with the follies of Wall street and the presidential political campaigns. The debate on Friday did very little to sooth my nerves. I was really hoping that we might get some substance out of at least one of these guys. Instead, we got more of their campaign soundbites and doublespeak.
It was really annoying to listen to McCain split hairs regarding Obama's prior statements concerning how he might engage with Iran. McCain made it sound as if Obama was going to invite Mahmoud Ahmadinejad out to a strip club with the boys where over a couple of drinks would gently try to convince him to give up his nuclear aspirations. ( for a great laugh on this check out this clip) here If these guys have nothing more to offer us than comparing who has the most bracelets then I'm going to quit watching. Except for the VP debate; which I'm completely stoked for!
Seriously, how many references to 'Pork Barrel' spending and 'Earmarks' can McCain try to make in one speech? I'm speaking out of class and I don't have the data to back this up -yet,( hmmm,perhaps in next blog post? )but I think it's fairly safe to say that McCain has plenty of history directing federal funds to his home state. I applaud his efforts for curtailing this type of under the radar spending, but trying to pin Obama as some kind of big government spender at this time is just plain wrong.
Speaking of government spending, I saw this great graph of how our federal dollars are spent. graph here It doesn't take an economics degree to understand that our spending and unfunded liabilities are too large. Are you seeing this Obama and McCain? We know you, or at least your aides, read the NYTimes so do us all a favor and "Please focus on the bigger picture!!"
The numbers being tossed around these days are amazingly large. Is it even possible to comprehend them? I don't know about you, but I sure wish we would have spent the money used to destroy Iraq and bail out Wallstreet on clean energy infrastructure, education, and health care for children.
But I digress, because this is not what I wanted to write about tonight. Although all of the above is important, it's not nearly as upsetting as the scam I just recently unearthed. This is a scam that I feel is being perpetrated all over America, to both Democrats and Republicans. The scandal that I'm referring to is the complete rip off that buying a BLT at a restaurant has become.
One would think that if you ordered a BLT you would get considerably more bacon than if you ordered a sandwich that had bacon as just a topping. What I'm discovering is that this is often not the case. When I ordered a BLT recently it only had 3 crummy pieces of dried out bacon on it. That's not a sandwich. I didn't order BREAD, lettuce and tomato for goodness sakes.
If this was an one off experience I wouldn't mind so much. But it has happened a few times over the past year to me. That makes it a certifiably trend! What gives? It's an outrage for certain. There really is nothing better than a bacon, lettuce, and tomato sandwich on toasted sourdough bread if it's done right. If you throw in some avocado, then you have a combination that was likely created by the Gods themselves! Of course, holding the mayo is vitally important, since mayo is disgusting. But the problem is that restaurants are cutting corners and passing off sorry excuses for a BLT.
As this is truly a partisan issue I'm going to ask all of you to boycott the restaurant made BLT. Hopefully, this call to arms will gather steam and we can affect some real change in this country. Now that is a pork barrel project worth considering!!
Sunday, September 28, 2008
Sunday, September 21, 2008
Glass Steagall who?
I remember debating the repeal of the Glass Steagall Act back in a college English class. Glass Steagall was born in the aftermath of the stock market crash of 1929 in the midst of the Great Depression. It was designed to safeguard the public against undesireable speculation between commericial and investment banks. It became a law in 1933. Back then I wouldn't haven't been able to tell you the difference between Glass Steagall and 'A Flock of Seagalls.'
Some kid wrote a paper about the merits of it's repeal and we had to do a peer review of it. That must have in 1995. Although I don't remember having much of an opinion about the content of the paper I do remember thinking he was a crummy writer. Funny the things we remember.
I bring this up because I suspect we'll be hearing more about Glass Steagall in near future. As this banking crisis soaks into John Q's collective consciousness next year there is going to be debate about the wisdom of this laws repeal.
The law itself was officiallly repealed on November 12, 1999 by the Gramm-Leach-Bliley Act signed by President Bill Clinton. wikipedia article here
It is interesting to note that on that day the S&P 500 was at 1388.51 and Friday, Sept 20, 2008 it closed at 1255.08 for a loss of about 10%. Now that is what I call progress, NOT!!!
Some kid wrote a paper about the merits of it's repeal and we had to do a peer review of it. That must have in 1995. Although I don't remember having much of an opinion about the content of the paper I do remember thinking he was a crummy writer. Funny the things we remember.
I bring this up because I suspect we'll be hearing more about Glass Steagall in near future. As this banking crisis soaks into John Q's collective consciousness next year there is going to be debate about the wisdom of this laws repeal.
The law itself was officiallly repealed on November 12, 1999 by the Gramm-Leach-Bliley Act signed by President Bill Clinton. wikipedia article here
It is interesting to note that on that day the S&P 500 was at 1388.51 and Friday, Sept 20, 2008 it closed at 1255.08 for a loss of about 10%. Now that is what I call progress, NOT!!!
Give me Spitzer
I'm not going to spill ink on how contemptible the market has become over the past 8 years under our ownership, laissez faire loving MBA president and his blunt intrument of easy lending terms, Allen Greenspan. A lot of smart people have been chronicling this better than I ever could.
If you want to get some perspective on these financial current events check out these blogs;
the big picture
market ticker
minyanville
One of the ideas that I've been noodling over the past few days about is who I would like to see run the SEC when a new administration takes over. Current SEC chairman Christopher Cox acts like he doesn't have any idea how markets operate. Surely not a free market anyway. Seriously, is outlawing ALL short selling any kind of answer? What is this Russia? How about just enforcing the laws already on the books. I thought naked short selling was already illegal anyway. Maybe the government should prosecute some of these supposed 'criminals' before we start a witch hunt on short sellers in general?
When all of the dust settles in the market and these interventions are absorbed into the governments warm embrace there is certainly going to be a renewed enthusiasm for increased regulation. This is exactly what happened during the Great Depression. In 1933, in his first term President Roosevelt appointed Joseph Kennedy to be the first Chairman of the new Securities Exchange Commission, the SEC. Joseph Kennedy, JFK's father, made his fortune on wallstreet during the 1920s by running investment pools that participated on insider trading. It was legal then. He famously sold before the crash. His appointment was analogous to putting the fox in charge of the hen house.
If we can't find an ambitious hedge fund manager to take the job I think we should look for someone that is no friend to Wallstreet. My choice for SEC Chaiman is Elliot Spitzer. I can think of no one better. He's hated by Wallstreet and understands it's inner workings. Plus, he has an axe to grind after his political career was destroyed, probably by some of the wallstreeters that we are now bailing out. Now that the US taxpayer has bailed Wallstreet, I think we need to at least put someone in charge that we know will look out for us, the taxpayer. Elliot, are you listening? We need you!
If you want to get some perspective on these financial current events check out these blogs;
the big picture
market ticker
minyanville
One of the ideas that I've been noodling over the past few days about is who I would like to see run the SEC when a new administration takes over. Current SEC chairman Christopher Cox acts like he doesn't have any idea how markets operate. Surely not a free market anyway. Seriously, is outlawing ALL short selling any kind of answer? What is this Russia? How about just enforcing the laws already on the books. I thought naked short selling was already illegal anyway. Maybe the government should prosecute some of these supposed 'criminals' before we start a witch hunt on short sellers in general?
When all of the dust settles in the market and these interventions are absorbed into the governments warm embrace there is certainly going to be a renewed enthusiasm for increased regulation. This is exactly what happened during the Great Depression. In 1933, in his first term President Roosevelt appointed Joseph Kennedy to be the first Chairman of the new Securities Exchange Commission, the SEC. Joseph Kennedy, JFK's father, made his fortune on wallstreet during the 1920s by running investment pools that participated on insider trading. It was legal then. He famously sold before the crash. His appointment was analogous to putting the fox in charge of the hen house.
If we can't find an ambitious hedge fund manager to take the job I think we should look for someone that is no friend to Wallstreet. My choice for SEC Chaiman is Elliot Spitzer. I can think of no one better. He's hated by Wallstreet and understands it's inner workings. Plus, he has an axe to grind after his political career was destroyed, probably by some of the wallstreeters that we are now bailing out. Now that the US taxpayer has bailed Wallstreet, I think we need to at least put someone in charge that we know will look out for us, the taxpayer. Elliot, are you listening? We need you!
Has the stock market bottomed yet?
I wish I knew that answer. The truth is that nobody does. However, I have a hunch that we aren't there yet. Not even close. I don't believe for a second that the government's actions in attempting to arrest systemic failure to our financial system over the last week is going to mark the bottom of anything. Accept me free markets! Expect many more sucker rallies before we hit the ultimate bottom.
I spent some time this weekend rereading parts of 'Devil Take the Hindmost' by Edward Chancellor. Its a history of some of the greatest bubbles in financial history. I was particularly interested in the period preceding the the stock market crash in Oct 29, 1929 and it's aftermath. It was eerily shocking to read how similar the current period is in terms of excessive use of leverage, credit expansion and lack of government oversight of the markets.
For those thinking that the worst might be over for stock market losses please consider the following; on Oct 29, 1929 the Dow was at 260. When it finally bottomed in the summer of 1932 it stood at 41.88! Along the way there were many rallies. Some that sent the Dow up as much as 50%. Please keep this in mind as we consider the market;s reaction to all of this government emergency intervention!
Why the pessimism? For starters, I think we have seen the bursting of the credit bubble that was over 20 years in the making. it's silly to think that we can flush all of that excess out in less than 1 or two years. The housing bubble of the past 4 years was the height of what I like to call the 'vig economy'. As interest rates stayed too low for too long they were met by increased leverage and securitization. There is lots of reasons and blame to pass around for this. Everyone on Wallstreet got their piece of the pie. Mainstreet didn't complain because they thought they were getting rich off of the appreciation of their homes.
It was all an illusion. As the rest of the world was investing in their infrastructure and industry; we spent borrowed money on handbags, flat screens and anything else we could find at the mall. The music has now stopped and we are the ones on our collective keisters!
In Keynes's 1936 book 'The General Theory of Employment, Interest and money' he famously wrote:
"Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes a bubble on a whirlpool of speculation. When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill done."
If that doesn't sound like a warning about derivatives and securization associated with the housing boom I don't know what does. Like I said, it's the 'vig economy.'
So when will the market bottom? Not for a long time. How will we know when we are there? I'm waiting for the day when one tells someone that they want to buy a house for an investment and they look at you like you are crazy. The same type of crazy that they looked at one two years ago if you told them that you thought housing was likely to go down in price.
I spent some time this weekend rereading parts of 'Devil Take the Hindmost' by Edward Chancellor. Its a history of some of the greatest bubbles in financial history. I was particularly interested in the period preceding the the stock market crash in Oct 29, 1929 and it's aftermath. It was eerily shocking to read how similar the current period is in terms of excessive use of leverage, credit expansion and lack of government oversight of the markets.
For those thinking that the worst might be over for stock market losses please consider the following; on Oct 29, 1929 the Dow was at 260. When it finally bottomed in the summer of 1932 it stood at 41.88! Along the way there were many rallies. Some that sent the Dow up as much as 50%. Please keep this in mind as we consider the market;s reaction to all of this government emergency intervention!
Why the pessimism? For starters, I think we have seen the bursting of the credit bubble that was over 20 years in the making. it's silly to think that we can flush all of that excess out in less than 1 or two years. The housing bubble of the past 4 years was the height of what I like to call the 'vig economy'. As interest rates stayed too low for too long they were met by increased leverage and securitization. There is lots of reasons and blame to pass around for this. Everyone on Wallstreet got their piece of the pie. Mainstreet didn't complain because they thought they were getting rich off of the appreciation of their homes.
It was all an illusion. As the rest of the world was investing in their infrastructure and industry; we spent borrowed money on handbags, flat screens and anything else we could find at the mall. The music has now stopped and we are the ones on our collective keisters!
In Keynes's 1936 book 'The General Theory of Employment, Interest and money' he famously wrote:
"Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes a bubble on a whirlpool of speculation. When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill done."
If that doesn't sound like a warning about derivatives and securization associated with the housing boom I don't know what does. Like I said, it's the 'vig economy.'
So when will the market bottom? Not for a long time. How will we know when we are there? I'm waiting for the day when one tells someone that they want to buy a house for an investment and they look at you like you are crazy. The same type of crazy that they looked at one two years ago if you told them that you thought housing was likely to go down in price.
Enough of this. She's not qualfied.
The Palin shows continues in the media unabated. What great fodder for the media. However, I'm frustrated and already tired of this. Are we really debating the qualifications of Palin versus Obama? If you had two interviewees for a job at your company, one worked as manager at a Taco Bell and the other just finished their MBA from a top school who would you hire? Even if my business was selling taco sauce, I would still take the MBA! Folks, running the back sale at the PTA meeting is not the same thing as running a country.
In retrospect, it was a brilliant Karl Rove move to insist on her selection. Not because she is brilliant and be a great VP, but because selecting her does exactly what the RNC party needs to win the election; distract Americans from real issues and get them focused on highly emotional, faith based politics. They are masters at this tactic.
A friend sent me this polling website and asked me to vote 'no' to Palin. No problem, you don't need to ask me twice to do that. But then I took a minute and read the attached debate between Gloria Feldt and Rep. Michele Bachmann over her qualifications, character and treatment in the media. Gloria Feldt is an activist, author and blogger and Michele Bachmann is the first Republican woman to be elected to the U.S. House of Representatives from Minnesota.
I was really surprised to see such little substance. Read it for yourself;
PBS interview
Is this election really about the glass ceiling for women and whether or not hockey moms are getting a fair shake in corporate America and world? Although important; wouldn't it maybe be more important to discuss, oh I don't know; iraq policy, energy crisis, this little banking meltdown we are having, surging entitlment costs, etc.?
To answer the question, she's not qualified. Have you listened to her speak? She doesn't have a clue what's going on in the world. Take a look at her profile I found in Wikipedia and don't tell me this impresses you:
Palin wikipedia post
Here are some highlights from her distinguished academic career:
In 1982, Palin enrolled at Hawaii Pacific College but left after her first semester. From there she transferred to North Idaho College, where she spent two semesters as a general studies major. From the community college she then transferred to the much larger University of Idaho for two semesters.[11][12] During this time Palin won the Miss Wasilla Pageant beauty contest,[13][14] then finished third (second runner-up) in the Miss Alaska pageant,[15][16] at which she won a college scholarship and the "Miss Congeniality" award.[17] She then left the University of Idaho and attended Matanuska-Susitna College in Alaska for one term. The next year she returned to the University of Idaho where she spent three semesters completing her Bachelor of Science degree in communications-journalism, graduating in 1987.[11][12]
Now let's take a look at our little community organizer Obama:
obama wikipedia
Obama graduated from Columbia and then attended Harvard Law School. " Beginning in 1992, Obama taught constitutional law at the University of Chicago Law School for twelve years, being first classified as a Lecturer from 1992 to 1996, and then as a Senior Lecturer from 1996 to 2004.[25]"
Hmmm, I would say he is just a bit more qualified than our moose shooting Governor from Alaska. Just a little.
In retrospect, it was a brilliant Karl Rove move to insist on her selection. Not because she is brilliant and be a great VP, but because selecting her does exactly what the RNC party needs to win the election; distract Americans from real issues and get them focused on highly emotional, faith based politics. They are masters at this tactic.
A friend sent me this polling website and asked me to vote 'no' to Palin. No problem, you don't need to ask me twice to do that. But then I took a minute and read the attached debate between Gloria Feldt and Rep. Michele Bachmann over her qualifications, character and treatment in the media. Gloria Feldt is an activist, author and blogger and Michele Bachmann is the first Republican woman to be elected to the U.S. House of Representatives from Minnesota.
I was really surprised to see such little substance. Read it for yourself;
PBS interview
Is this election really about the glass ceiling for women and whether or not hockey moms are getting a fair shake in corporate America and world? Although important; wouldn't it maybe be more important to discuss, oh I don't know; iraq policy, energy crisis, this little banking meltdown we are having, surging entitlment costs, etc.?
To answer the question, she's not qualified. Have you listened to her speak? She doesn't have a clue what's going on in the world. Take a look at her profile I found in Wikipedia and don't tell me this impresses you:
Palin wikipedia post
Here are some highlights from her distinguished academic career:
In 1982, Palin enrolled at Hawaii Pacific College but left after her first semester. From there she transferred to North Idaho College, where she spent two semesters as a general studies major. From the community college she then transferred to the much larger University of Idaho for two semesters.[11][12] During this time Palin won the Miss Wasilla Pageant beauty contest,[13][14] then finished third (second runner-up) in the Miss Alaska pageant,[15][16] at which she won a college scholarship and the "Miss Congeniality" award.[17] She then left the University of Idaho and attended Matanuska-Susitna College in Alaska for one term. The next year she returned to the University of Idaho where she spent three semesters completing her Bachelor of Science degree in communications-journalism, graduating in 1987.[11][12]
Now let's take a look at our little community organizer Obama:
obama wikipedia
Obama graduated from Columbia and then attended Harvard Law School. " Beginning in 1992, Obama taught constitutional law at the University of Chicago Law School for twelve years, being first classified as a Lecturer from 1992 to 1996, and then as a Senior Lecturer from 1996 to 2004.[25]"
Hmmm, I would say he is just a bit more qualified than our moose shooting Governor from Alaska. Just a little.
Fw: election map
I thought this was a great map showing how the election is shaping up state by state. Hopefully, this movie doesn't end the way it did in 2000 and 2004. But I'm very worried it might.
AM
Subject: election map
Subject: election map
clipped from 
Sunday, September 7, 2008
I Must Be Taking Crazy Pills!?
Yesterday I heard that McCain was leading in the polls. You have got to be joking. I nearly spit out my drink. Then today, I heard that Palin has re energized the Republican ticket and that she has a 85% approval rating amongst Republicans. Finally, I saw an article on yahoo that says that a lot of women are now indicating they will vote for McCain verses Obama. Is this really happening?
I feel like I'm in an episode of the Twilight Zone. Its not necessarily surprising to me as much as it is truly disturbing. As I was discussing with a good friend today, the Democratic Party has a lot of flaws. Especially, when it comes to targeting it's core audience. We'll get into that more in another post. Hat's off to The Republican ticket for maximizing their chance to leverage this confusion.
For now I'd like to point out some of the few things I have learned about the Republican VP pick. Please correct me where I'm wrong. Given that the Republican campaign hasn't granted any interviews with her we have limited material to work with. Here is the list of highlights I have selectively gathered about her vast career in politics:
1.I heard a CNN report setting the record straight about that government plane that she supposedly sold on EBAY for a profit. They contend that yes it was listed at one time on EBAY, but it didn't sell and was sold through a dealer, at a loss. Not quite as good of a soundbite I guess.
2.The idea that she is any kind of a budget hawk is a complete joke. In an article in the 'Economist' this past weekend. article here
they explain what really happened to that 'Road to Nowhere' project she so defiantely resisted for the good of the taxpayer. When she was campaigning she was all for it until it was exposed for the scam it was. Only then did she change her mind about supporting it. Oh yeah, and the money was simply used to spend on something else. Is this what McCain meant when he said he was going to protect us from "earmark" projects?
3. Remember the theme song to 'The Beverly Hillbillies'? "and then one day he was shooting at some food and up from the ground came a bumbling crude, black gold, Texas tea." I can already see where the Republicans are going with Palin. She's going to save us by her vast knowledge of petropoltics! I can hear the war chant; America must reduce it's oil dependence. We MUST drill in Alaska!!! I say go ahead. We should be surveying that area anyway. What they will likely find is that yes there is oil in Alaska. Probably enough to satisfy US Consumption ( currently at about 25 million barrels per day ) for about 1 whole year. Oh yeah, and it will take about a decade to build out the infrastructure to get to it. That should take the pressure off at the pumps! Trust me, you won't hear that from the debates.
Nor will you hear about how Palin negotiated a windfall tax on the oil companies. That doesn't really rhyme with the lower corporate taxes they are promising does it? Her state also gets more money per capita from the Federal Government than almost any other. I guess it will be nice to have someone that knows about how these earmarks work so that she can put an end to them. Sounds more like putting the fox in charge of the hen house to me.
4. Do I have bring up her comments about wanting to teach creationism in public schools or her messianic rumblings about God wanting us to go to war with Iraq?
5. Finally, what's with McCain picking her in the first place? Apparently,he only met her once before. Was it her distinguished record that attracted him to her? Her vast experience running potluck dinners from the neighborhood hockey moms? It's been absolutely fascinating to me to hear the Republican talking heads rally to her defense. All give the Republicans one thing, they are uniform and united. You have to believe that Giuliani needed a few gin and tonics before he went onstage to sing her praises. Seriously, how could he go up there with a straight face and tow the party line. She must have promised him a squeezer if he did and came across as sincere.
This is a long rant, I know. I'm just bothered that this country is so accepting of these politicians. Are we really that gullible? Unfortunately, I think many of us our. We shouldn't have to dig this deep to get a clear picture. But, that is where we are at. Most politicians by nature would rather drink piss from someone that just ate asparagus then tell us what they really are about. But I guess that is only fair considering all of the crap they spoon feed us that we so willing eat!
I feel like I'm in an episode of the Twilight Zone. Its not necessarily surprising to me as much as it is truly disturbing. As I was discussing with a good friend today, the Democratic Party has a lot of flaws. Especially, when it comes to targeting it's core audience. We'll get into that more in another post. Hat's off to The Republican ticket for maximizing their chance to leverage this confusion.
For now I'd like to point out some of the few things I have learned about the Republican VP pick. Please correct me where I'm wrong. Given that the Republican campaign hasn't granted any interviews with her we have limited material to work with. Here is the list of highlights I have selectively gathered about her vast career in politics:
1.I heard a CNN report setting the record straight about that government plane that she supposedly sold on EBAY for a profit. They contend that yes it was listed at one time on EBAY, but it didn't sell and was sold through a dealer, at a loss. Not quite as good of a soundbite I guess.
2.The idea that she is any kind of a budget hawk is a complete joke. In an article in the 'Economist' this past weekend. article here
they explain what really happened to that 'Road to Nowhere' project she so defiantely resisted for the good of the taxpayer. When she was campaigning she was all for it until it was exposed for the scam it was. Only then did she change her mind about supporting it. Oh yeah, and the money was simply used to spend on something else. Is this what McCain meant when he said he was going to protect us from "earmark" projects?
3. Remember the theme song to 'The Beverly Hillbillies'? "and then one day he was shooting at some food and up from the ground came a bumbling crude, black gold, Texas tea." I can already see where the Republicans are going with Palin. She's going to save us by her vast knowledge of petropoltics! I can hear the war chant; America must reduce it's oil dependence. We MUST drill in Alaska!!! I say go ahead. We should be surveying that area anyway. What they will likely find is that yes there is oil in Alaska. Probably enough to satisfy US Consumption ( currently at about 25 million barrels per day ) for about 1 whole year. Oh yeah, and it will take about a decade to build out the infrastructure to get to it. That should take the pressure off at the pumps! Trust me, you won't hear that from the debates.
Nor will you hear about how Palin negotiated a windfall tax on the oil companies. That doesn't really rhyme with the lower corporate taxes they are promising does it? Her state also gets more money per capita from the Federal Government than almost any other. I guess it will be nice to have someone that knows about how these earmarks work so that she can put an end to them. Sounds more like putting the fox in charge of the hen house to me.
4. Do I have bring up her comments about wanting to teach creationism in public schools or her messianic rumblings about God wanting us to go to war with Iraq?
5. Finally, what's with McCain picking her in the first place? Apparently,he only met her once before. Was it her distinguished record that attracted him to her? Her vast experience running potluck dinners from the neighborhood hockey moms? It's been absolutely fascinating to me to hear the Republican talking heads rally to her defense. All give the Republicans one thing, they are uniform and united. You have to believe that Giuliani needed a few gin and tonics before he went onstage to sing her praises. Seriously, how could he go up there with a straight face and tow the party line. She must have promised him a squeezer if he did and came across as sincere.
This is a long rant, I know. I'm just bothered that this country is so accepting of these politicians. Are we really that gullible? Unfortunately, I think many of us our. We shouldn't have to dig this deep to get a clear picture. But, that is where we are at. Most politicians by nature would rather drink piss from someone that just ate asparagus then tell us what they really are about. But I guess that is only fair considering all of the crap they spoon feed us that we so willing eat!
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