It's Our Weekend And We'll Cry If We Want To: January 15-17, 2010

[Demeter]

Yes, I'm late.

So we send up the Girls of the 60's (and thereabouts) as our theme and distraction from the economic events of the week, month, year, decade, whatever.

Girls started coming into their own in the 60's. Whether it was the Women's Movement, the climbing divorce rate, the rising education levels, the tendency to stop paying women half of what men got (and raise it to 69%), or just the sheer numbers of women who weren't going to marry because their potential mates were being blown to bits in Vietnam, girls raised their sights from homemaking to world-shaking.

And shake they did. Metaphorically and literally. Think of Goldie Hawn frugging across the television set on Laugh-In...but don't do this at home, ladies!!



But join in as we reminisce about our misspent, totally crushed and transformed youth. And kwetch about our totally bogus, collapsing economy.

http://www.youtube.com/watch?v=WRbsz1Ha7Zo

[Tansy_Gold]

1. First rec! n/t

[KoKo]

2. Go Get'em Goldie!

Thanks Demeter.

[Demeter]

3. Three, Count 'Em, Banks Down and Out

Town Community Bank and Trust, Antioch, Illinois, was closed today by the Illinois Department of Financial Professional Regulation, Division of Banking, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First American Bank, Elk Grove Village, Illinois, to assume all of the deposits of Town Community Bank and Trust...As of September 30, 2009, Town Community Bank and Trust had approximately $69.6 million in total assets and $67.4 million in total deposits. First American Bank did not pay the FDIC a premium to assume all of the deposits of Town Community Bank and Trust. In addition to assuming all of the deposits, First American Bank agreed to purchase approximately $67.6 million of Town Community Bank and Trust's assets. The FDIC retained the remaining assets for later disposition...The FDIC and First American Bank entered into a loss-share transaction on $56.2 million of Town Community Bank and Trust's assets. First American Bank will share in the losses on the asset pools covered under the loss-share agreement. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $17.8 million. First American Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to all alternatives. Town Community Bank and Trust is the second FDIC-insured institution to fail in the nation this year, and the first in Illinois. The last FDIC-insured institution closed in the state was Independent Bankers' Bank, Springfield, on December 18, 2009.

St. Stephen State Bank, St. Stephen, Minnesota, was closed today by the Minnesota Department of Commerce, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First State Bank of St. Joseph, St. Joseph, Minnesota, to assume all of the deposits of St. Stephen State Bank...As of September 30, 2009, St. Stephen State Bank had approximately $24.7 million in total assets and $23.4 million in total deposits. First State Bank of St. Joseph did not pay the FDIC a premium to assume all of the deposits of St. Stephen State Bank. In addition to assuming all of the deposits of the St. Stephen State Bank, First State Bank of St. Joseph agreed to purchase essentially all of the failed bank's assets.

The FDIC and First State Bank of St. Joseph entered into a loss-share transaction on $20.4 million of St. Stephen State Bank's assets. First State Bank of St. Joseph will share in the losses on the asset pools covered under the loss-share agreement...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $7.2 million. First State Bank of St. Joseph's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to all alternatives. St. Stephen State Bank is the third FDIC-insured institution to fail in the nation this year, and the first in Minnesota. The last FDIC-insured institution closed in the state was Prosperan Bank, Oakdale, on November 6, 2009.

Barnes Banking Company, Kaysville, Utah, was closed today by the Utah Department of Financial Institutions, which appointed Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC created the Deposit Insurance National Bank of Kaysville (DINB), which will remain open until February 12, 2010 to allow depositors access to their insured deposits and time to open accounts at other insured institutions.

At the time of closing, the receiver immediately transferred to the DINB all insured deposits of Barnes Banking Company, except for brokered deposits, certificates of deposits (CDs) and individual retirement accounts (IRAs). The receiver also transferred to the DINB all secured deposits by public entities.

The FDIC will mail checks directly to customers with CDs and IRAs. For the brokered deposit customers, the FDIC will pay the brokers directly for the amount of their insured funds. Customers with brokered deposits should contact their brokers directly for information concerning their money.

The main office and all branches of Barnes Banking Company will open from 9:00 a.m. to 1:00 p.m., on Saturday. The DINB will maintain Barnes Banking Company's normal business hours thereafter. Zions First National Bank, Salt Lake City, Utah, will provide operational management of the DINB. Banking activities, such as direct deposit and writing checks, ATM and debit cards, can continue normally for former customers of Barnes Banking Company until February 12, 2010. Barnes Banking Company official checks will continue to clear and will be issued to customers closing accounts.

All insured depositors of Barnes Banking Company are encouraged to transfer their insured funds to other banks during this transitional period. They may do so by asking their new bank to electronically transfer their deposits from the DINB or by writing checks for the amount in their accounts. For depositors who have not closed or transferred their accounts on or before February 12, 2010, the FDIC will mail checks to the address of record for the amount of the insured funds.

Under the FDI Act, the FDIC may create a deposit insurance national bank to ensure that depositors have continued access to their insured funds where no other bank has agreed to assume the insured deposits. This arrangement allows for uninterrupted direct deposits and automated payments from customers' accounts and allows them time to find another institution with which to do business.

As of September 30, 2009, Barnes Banking Company had $827.8 million in total assets and $786.5 million in total deposits. At the time of closing, there were approximately $100,000 in deposit funds that potentially exceeded the insurance limits. Uninsured deposits were not transferred to the DINB. This estimate is likely to change once the FDIC obtains additional information from these customers...

The FDIC as receiver will retain all the assets from Barnes Banking Company for later disposition. Loan customers should continue to make their payments as usual.

The cost to the FDIC's Deposit Insurance Fund is estimated to be $271.3 million. Barnes Banking Company is the fourth bank to fail this year and the first in Utah. The last FDIC-insured institution closed in the state was America West Bank, Layton, on May 1, 2009.

[ozymandius]

10. Truly puzzling.

None of these banks is in Georgia. What gives?

[Demeter]

14. The Whole Thing is Puzzling

Why so few? Why so small?

[BR_Parkway]

53. Effect from the regulators relaxing the rules on CRE requirements perhaps?

Seems like a lot of banks would have had much better looking books once they were allowed to pretend that those loans were magically good again.

[burf]

58. The bank in St Stephen

basically ran outta money.

This from the Mpls Star Tribune: St. Stephen State Bank, a 90-year-old community bank founded by farmers that bet big on real estate development, was shut down by government regulators late Friday after running out of money.

snip

Though tiny in size, St. Stephen State Bank was heavily invested in commercial real estate. The bank had the highest concentration of commercial real estate loans, such as construction-related lending and mortgages on commercial projects, of any bank in the state. Losses on those loans steadily ate away at the bank's capital, the money it keeps on hand to cushion itself against losses.

Link: http://www.startribune.com/business/81798047.html?page=1&c=y

It looks as though they were playing the "mark to fantasy" game and when the music stopped in their case, they didn't get a chair!

The article mentions how the FDIC is sweetening the pot for other banks to take over the failing institutions. The incoming banks get the failures for half the debt, the FDIC picking up the other half. I guess this is designed to make Shelia's allowance go farther.

Good weekend to all and thanks Demeter for all the work you put into the WEE.

[Demeter]

63. They Forgot Which Business They Were In

and who their customers were.

[AnneD]

87. The Supremes....

Baby Where has Our Love (and money) Gone

www.youtube.com/watch?v=izzKUoxL11E

[DemReadingDU]

106. The Supremes Baby Love

This is the second of twelve number number 1 singles by the Supremes. Baby Love stayed at the number one position for 4 weeks. The next number one hits were come see about me, stop in the names of love, back in my arms again, I hear a symphony, you can't hurry love, you keep me hangin' on, love is here and now you're gone, the happening, love child and someday we'll be together. Their biggest competition on the billboard charts were the Beatles.

http://www.youtube.com/watch?v=23UkIkwy5ZM

[CatholicEdHead]

114. It is also in the middle of Rep Bachmann's district

:crazy:

Of all the MN banks that have closed, the mostly have been in the MN-6 CD, the north Twin Cities metro, up along I-94. Betting on real estate hurt them badly.

[MineralMan]

4. Goldie! We miss you. You turned away.

[Tansy_Gold]

72. Actually, she didn't

She's still here, there, still working, still trying to change the world. Just like the rest of us.

:hi: Goldie!


TG

[stevedeshazer]

5. You just Lesley Gored me. Is this some new Rickroll thing?

:shrug:

[Demeter]

7. So Solly no speaka de language

What?

[Demeter]

6. Australia's jobless rate falls to 5.5% in December

http://www.marketwatch.com/story/australias-jobless-rate-falls-to-55-in-december-2010-01-13?siteid=YAHOOB

Australia's jobless rate eased slightly in December, with the economy adding more than three times as many jobs as economists had forecast.

The nation's unemployment rate, on a seasonally-adjusted basis, fell 0.1% to 5.5% from a revised 5.6% in November, the Australian Bureau of Statistics said Thursday.

The number of people employed in December climbed by 35,200 to a seasonally adjusted 10.906 million, data showed.

On average, economists expected an unemployment rate of 5.8%, with the number of employed up 10,000, according to Dow Jones Newswires.

The number of people with part-time employment increased by 27,900 persons to 3.271 million, while the number with full-time employment climbed 7,300 to 7.635 million, according to the data.

[Demeter]

8. Obama's Turn to Cry

http://www.youtube.com/watch?v=Yy7aPyNuPxA&NR=1

[Demeter]

9. Census as Jobs Program Still not Good Enough

http://econblogreview.blogspot.com/2010/01/census-as-jobs-program-still-not-good.html


It would appear that the administration has decided that the 2010 census is the latest stimulus program.

In yesterday's writeup of the poor employment numbers, Bloomberg wrote up a "talking head" or two as pointing out there would be a boost to the economy from hiring over a million census workers. I pointed that out as cheerleading in my post on the jobs data, titled: Jobs Friday: More Establishment Cheerleading as Hard Times Continue, but did not imagine that the census effort would actually merit its own story. But it did, and it's easy to imagine that this is part of an effort to keep people's hopes up that prosperity is right around the corner, if it's not here already (GDP and stocks rising and all that stuff). Here is Bloomberg:

Census Jobs May Jump-Start U.S. Employment Rebound in 2010:

The 2010 census couldn’t have come at a better time for the U.S. economy.

The government will hire about 1.2 million temporary workers in the first half of the year to administer the decennial population count, possibly providing a bridge to gains in private employment later in the year.

The surge will probably dwarf any hiring by private employers early in 2010 as companies delay adding staff until they are convinced the economic recovery will be sustained. Money earned by the clipboard-toting workers going door-to-door to verify the government population survey is likely to be spent, giving the economy an extra lift.

Now just think about the first sentence, which states that the census hiring will "probably dwarf" private hiring. But if the optimists are right, jobs will have a "V" recovery and per the very next paragraph of the article, Barclay's' Dean Maki has the economy adding 2.5 million jobs this year. In that scenario, the census hiring "dwarfs" nothing. Is Bloomberg setting us up for ongoing weak jobs numbers?

One reason I am sensing a concerted administration/Establishment effort here comes from the 2000 census. From Census Day, 2000, put out by the Census Bureau:

Hiring

- The Census Bureau plans to hire and train more than half a million
people to conduct Census 2000; these temporary workers are drawn from a
pool of 3 million applicants. As of February, more than 60 percent of the
applicants were women and more than 65 percent of total applicants, 40 or
older.

- Enumerator pay rates range from $8.25 per hour to $18.50 per hour.

- It costs taxpayers an extra $35 each time an enumerator goes out to
retrieve a census form. On the other hand, it cost only $3 if the
respondent mails their form back.

The Census Bureau appears to have treated the effort as a cost center. Ten years ago, 500,000+ temp hires occurred. This year, it looks as though the about 1.2 million hires will be at least twice as many hires per capita as were needed then. On its face, this appears to be the same type of employment practice that the city of Chicago has perfected at its convention center and elsewhere: two (or more) people to do the job of one. We may get one census hire to drive the car, ring the doorbell, and carry the forms, and the other to do the interviewing. Whatever it takes to pump up the employment numbers.

A census was taken during the recession years of 1980 and 1990. I am hard-pressed to imagine/remember anyone thinking of this as a "stimulus". It's a sign of desperation in an administration and Establishment that have been blind-sided by the weakness in the real economy and that are searching for crumbs of good news. After all, a rising stock market is small beer come election time. The watchword is found in James Baker's classic one-word justification for the 1991 Gulf War: "Jobs". With yesterday's BLS survey showing "Not in labor force" increasing by an unbelievable 843,000 in December alone (approximately 10 million annualized!), you can imagine that Barack Obama has more on his mind than the racial insensitivity shown by Senate Majority Leader Reid during the campaign. Team O must be sweating bullets. The year-ago prediction of 8% peak unemployment if only the ARRA "stimulus" bill would get passed has begun to smell as rancid as other classics such as "Read my lips: no new taxes" and "Mission accomplished".

The truth is that census hiring is to real hiring as ketchup is to a vegetable. Of course the administration and Bloomberg know this, but when you lack a bazooka, fire your popgun.

[Demeter]

48. Eurozone jobless figure hits double digits

http://www.presstv.ir/detail.aspx?id=115636§ionid=3510213

Unemployment woes in the Eurozone show little signs of abatement as the latest official data confirms a ten-percent jobless figure for the euro-based economies.

In its latest records on the unemployment status of 16 European countries using the euro currency, the European Union statistics office portrayed a bleak outlook for the region's increasing jobless population and said that unemployment in the Eurozone has topped a critical ten percent.

The Friday report by the EU statistics body has put the unemployment figure at its highest level for over a decade.

[Tansy_Gold]

96. (I'll Never Find) Another You

From the 1993 reunion

http://www.youtube.com/watch?v=nMwRhkdjVyk&feature=related

And this one gives me goosebumps all over.

[ozymandius]

11. Record Bank Bonuses Based On Record Bank Fraud

— one that happens to be legal.

Ask yourself how hard it is for any finance firm to make money — risk free! — when they can borrow from the Federal Reserve at a rate of zero, and then turnaround and “lend” that same cash to the Treasury (buying bonds) at 3% ?

I suspect this was essentially the Bernanke/Paulson plan (now Bernanke/Geithner) all along — to s-l-o-w-l-y recapitalize the banks via the Japanese model. They selected the easier but less effective Japan option versus than the Swedish model, which forces insolvent institutions to reorganize, write down bad loans, recapitalize the banking sector (which allows banks to start lending again), but punished bondholders and wipes out shareholders.

That is how capitalism is supposed to work. Instead, the socialist bankers saved the banks (and their own asses), rather than the banking system. ...

Hence, once again we see record bonuses based on huge profits that may not be real. And we won’t find out the truth until the FASB forces accountants to accurately report losses.

http://www.ritholtz.com/blog/2010/01/record-bank-bonuses-based-on-record-fraud/

[ozymandius]

15. Paulson, Friedman Asked to Testify on AIG Bailout (Update2)

Jan. 15 (Bloomberg) -- Former Treasury Secretary Henry Paulson has been asked to join his successor Timothy Geithner in testifying before a House panel investigating bailout payments to American International Group Inc.’s trading partners.

Paulson was invited to a Jan. 27 hearing set by Edolphus Towns, chairman of the House Oversight and Government Reform Committee, about the decision to fully reimburse AIG’s bank counterparties for $62.1 billion in derivatives. Stephen Friedman, the former Federal Reserve Bank of New York chairman who serves on the board of Goldman Sachs Group Inc., has also been asked to appear, Towns said in a statement today. ...

Bernanke and Paulson should answer, in affidavits, if they were consulted on the decision to pay banks 100 cents on the dollar for protection tied to subprime mortgages and if they knew about efforts to ask AIG to withhold information from filings with the Securities and Exchange Commission, Issa said.

http://www.bloomberg.com/apps/news?pid=20601087&sid=a6O23pDQZRTU&pos=2

[Demeter]

17. Now We've Got You, Red Baron! You Won't Escape Us This Time!

[Tansy_Gold]

24. Royal Guardsmen also don't count! Sheesh, if you're gonna do the girls

DO THE GIRLS!



:hi:


TG

[Demeter]

25. I Was Tempted but Refrained from Posting the Ballad

I can't help the cliches--they are flowing like water out of the sewer tonight.

[Demeter]

16. Said Losses to Be Reported on the 12th of Never

[Tansy_Gold]

22. Johnny Mathis does NOT count

I am and always have been a HUGE fan of Johnny Mathis, but sorry, he don't count as a girl! :evilgrin:

[Demeter]

26. Tansy, I Don't Even Know Who That Is

Remember, I'm a Middle Boomer. I was thinking of Adelaide's response to when she was getting married to Nathan Detroit....

The only reason I know anything about Motown is because I was born and raised there. It was kind of hard to ignore...

[Tansy_Gold]

31. Here

http://www.johnnymathis.com/

[Tansy_Gold]

35. The ultimate love song

http://www.youtube.com/watch?v=kvosV1IhrRY

Audio isn't the best on this but it's still the incomparable Mathis.

[Demeter]

37. Wasn't He More 50's?

[Tansy_Gold]

39. In a word

No.

[Karenina]

116. Doch, doch, TG!!!

Late 50's it was indeed! I remember when my mom bought his first album I was 7 or so. Enthralled by his pipes, we played it non-stop and I played clarinet well enough to imitate his style. He was a great influence on my sound concept.

[Tansy_Gold]

117. Mathis' big singles hits were

-- Chances Are, 12th of Never, etc. -- late 50s, but as what I call a "song stylist" rather than a "Top 40 recording artist" his big career was in albums, and that was definitely in the 60s, 70s, 80s, etc.

You didn't *********** to a 3-minute 45 single; you did it to a stack of albums.


Or at least


Tansy Gold did :evilgrin: :blush:

[Demeter]

18. Bankers' Ballad

http://www.youtube.com/watch?v=CmOrWG2FTbg&NR=1

[AnneD]

88. PRIMO.......

:smoke:

[Demeter]

61. JPMorgan loan losses overshadow higher Q4 profit

http://news.yahoo.com/s/nm/20100115/bs_nm/us_jpmorgan

JPMorgan Chase & Co (JPM.N) reported deep losses on mortgage and credit card loans in the fourth quarter, damping hopes that consumer credit is on the mend.

Strong investment banking results helped quarterly profit soar to $3.3 billion, topping Wall Street expectations. But analysts had been hoping for signs that the bank's credit costs were leveling off or even starting to fall, particularly for consumer loans.

"Consumer credit may be close to a bottom here, but it's not getting better, and people wanted JPMorgan to say it's getting better," said Ralph Cole, portfolio manager at Ferguson Wellman Capital Management, which owns JPMorgan shares.

Losses at the second largest U.S. bank were in line with typically cautious guidance the bank had given in recent months but its projections for 2010 were hardly any more sunny.

"We don't know when the recovery is," Chief Executive Jamie Dimon said on a conference call with investors.

JPMorgan is the first of the major banks to report fourth-quarter numbers and its results may bode ill for competitors.

The New York-based bank's overall quarterly profit amounted to 74 cents a share, beating analysts' average estimate of 61 cents, according to Thomson Reuters I/B/E/S. Year-earlier earnings were $702 million, or 6 cents a share.

Revenue, excluding the impact of assets that have been packaged into bonds and largely sold to investors, totaled $25.2 billion, falling short of analysts' average forecast of $26.8 billion.

For a graph on JPMorgan's results, see: http://link.reuters.com/gaz73h

"The logic is, as goes JPMorgan, so goes the rest of the banks," said Matt McCormick, portfolio manager and banking analyst at Bahl & Gaynor Investment Counsel in Cincinnati.

CONSUMER EXPOSURE

The bank's large mortgage and credit card businesses have seen rising credit costs in the last year, offset only by record investment banking revenue.

Losses even on prime mortgages almost tripled to $568 million compared to a year earlier. The bank set aside a total of $4.2 billion to cover mortgage, home-equity and other consumer loan losses in the fourth quarter, up $653 million from the same quarter a year earlier.

To be sure, total credit losses excluding the impact of securitizations actually slipped to $7.8 billion from a high of $8.1 billion in the third quarter.

But much of that decline is due to a reduction in credit card losses related to a May offer allowing card customers to defer payments for a month. That deferral slowed the pace at which customers were delinquent at the end of last year, and pushes some customer defaults into the first quarter of 2010. Total credit losses were up 72 percent from the fourth quarter a year earlier. ...

[Demeter]

68. Big Banks Short Sell Fraud

http://thepursuitoffinancialhappiness.blogspot.com/2010/01/big-banks-short-sell-fraud.html


Diana Olick, in her blog Realty Check today , disclosed how big banks are coercing real estate agents to pay them money on the side off the official settlement statement to get the banks, as second lien holders, to agree to a short sell (below the value of the mortgage). This is not just a questionable pattern of conduct, it is specifically illegal. You should read her complete post in the link above.

Interestingly, although we have been very vocal for many months on the exceedingly inaccurate balance sheets banks are now allowed to publicly present, today's reaction to J. P. Morgan's earnings show a closer inspection of the information being provided. While J. P. Morgan had $3.3 billion in "profits" this last Quarter, analysts were disturbed by credit costs. Its mortgage and credit card business has seen rising costs. It set aside $4.2 billion in Q4 to cover mortgage losses which is up from $653 million vs a year ago. It increased its commercial loan loss reserve to $494 million from $190 million. Prime mortgage net charge-offs (what it expects to never be paid) increased to $568 million from $195 million a year ago. It wrote off loans at an annualized rate of 9.33%.

Continuing his critique, Joseph Stiglitz, has written a new book, "Freefall: America, Free Markets, and the Sinking of the World", and just published an article entitled, "Moral Bankruptcy", in which he argues that the current financial system has created a moral hazard which is a direct threat, not just to a free market but to society. As long as the systemically dangerous financial institutions are allowed to privately profit and disgorge their losses onto the public, they have no fear of failure and no reason to fear the law as long as they are considered "too big to fail".

[Demeter]

12. Rescuer presents rescued with the first bill

http://www.ft.com/cms/s/0/23b3d1e2-013d-11df-8c54-00144feabdc0,s01=1.html

...Financial institutions learned on Thursday that the Obama administration will charge them a fee based on the extent of their dependence on commercial paper and wholesale debt to fuel their operations.

Call it a tax, a levy or even “payback” for the missteps that helped push the world’s economies into a deep recession – officially, it is the White House’s Financial Crisis Responsibility Fee – the annual levy is expected to raise $90bn over the next decade.

For Bank of America, JPMorgan Chase, Citigroup and Goldman Sachs, the country’s biggest banks, the payments will exceed $1bn each this year, analysts predicted. Of the total fees collected during the life of the programme, 60 per cent will come from the 10 biggest financial services companies, the administration said.

But it is likely that few institutions of size – from Wells Fargo and PNC Financial Services, the commercial banks, and Morgan Stanley, the Wall Street powerhouse, to Deutsche Bank and Credit Suisse, the European lenders, to non-bank finance companies such as General Electric’s GE Capital unit – will escape the new toll. And yes, AIG, the hobbled insurer that remains under government control, will pay, too.

Details of the White House’s plan come just days before many of these lenders unveil full-year results, a timeline that Barack Obama, the president, made clear on Thursday was no coincidence.

“My commitment is to recover every single dime the American people are owed,” Mr Obama said. “And my determination to achieve this goal is only heightened when I see reports of massive profits and obscene bonuses at the very firms who owe their continued existence to the American people – who have not been made whole, and who continue to face real hardship in this recession.”

JPMorgan reports earnings on Friday, with Citigroup, Goldman, Bank of America and Morgan Stanley among those slated to unveil results next week. Investors and analysts alike expect many of the lenders to cap what was a good year for many of their businesses, especially those tied to the recovering capital markets...

[Demeter]

13. Citigroup plans to cap cash bonuses

http://www.ft.com/cms/s/0/97ce1764-017d-11df-8c54-00144feabdc0.html

Citigroup is to cap cash bonuses for bankers at below $100,000, according to people close to the situation. The move is aimed at defusing the public ire at Wall Street pay but could make it difficult for the US bank to retain its top talent.

Citi declined to comment but people close to the situation said the 2009 bonus pool at the bank, in which the US government has a 27 per cent stake, would be in line with the one in 2008 – a relatively low level compared with other years.

Like other banks, Citi would also pay a large part of bankers’ and traders’ bonuses in stock that could not be sold for a number of years, limiting the cash portion to below $100,000, these people added...

[Tansy_Gold]

40. Anita Humes -- Easier Said Than Done

http://www.youtube.com/watch?v=oZzx1LjRzXg

[Tansy_Gold]

21. Fontella Bass: "Rescue Me"

Then

http://www.youtube.com/watch?v=QXSocE_M1G4



2007??

http://www.youtube.com/watch?v=5Y3yBhX0dhc&feature=related

[Demeter]

27. SEC subpoenas big banks over CDOs

http://www.ft.com/cms/s/0/d72ffca2-0230-11df-8b56-00144feabdc0.html

Several leading international banks have received subpoenas from US regulators investigating one of the complex securities markets at the heart of the financial crisis, people familiar with the probe say.

The Securities and Exchange Commission sent subpoenas last month to banks including Goldman Sachs, Credit Suisse, Citigroup, Bank of America/Merrill Lynch, Deutsche Bank, UBS, Morgan Stanley and Barclays Capital, these people said. Requests for information were also made by the Financial Industry Regulatory Authority, which oversees broker-dealers.

The regulators are seeking information about the sale and marketing of so-called synthetic collateralised debt obligations during the financial crisis.

The SEC and Finra declined to comment on the investigation, which is at an early stage. The banks declined to comment. None has been accused of wrongdoing. CDOs are pools of bonds or mortgages and other loans that are sold to investors. Synthetic CDOs are backed by derivatives known as credit default swaps – a form of credit insurance – rather than actual loans or bonds themselves.

Securities regulators, who are under pressure to investigate possible wrongdoing related to the crisis, have been focused on whether investors in the market were provided accurate and relevant information or misled in some manner.

People familiar with the investigation said regulators are particularly interested in whether banks that created such instruments also bet against the clients who purchased them – thereby profiting while investors lost money.

Synthetic CDOs have been blamed by many analysts for exacerbating the financial crisis. Because synthetic CDOs are not backed by actual loans or bonds, but by derivatives, the market grew rapidly during the credit boom that ended with the collapse of the US subprime mortgage market.

However, because so many synthetic CDOs were ultimately linked to subprime mortgages, defaults by home buyers with poor credit histories reverberated around the global financial system. Investors came to discover than tranches of synthetic CDOs that had been rated triple A were, in fact, worthless.

Mary Schapiro, SEC chairman, told a commission investigating the financial crisis on Thursday that the SEC was probing complex debt securities that were sold by big banks in late 2006 and 2007.

[Demeter]

28. I Can Hear the Screaming Already

http://www.youtube.com/watch?v=t2yLMpGPU8A&feature=related

[Demeter]

29. Geithner faces demand for AIG records

http://www.ft.com/cms/s/0/1ce415b0-009e-11df-ae8d-00144feabdc0.html

The House oversight committee has submitted a legal demand for any phone records and e-mails from Tim Geithner that discuss payments from the New York Federal Reserve to AIG’s counterparties.

Republicans on the committee are attempting to link the Treasury secretary to the bail-out of AIG’s counterparties – a list headed by Société Générale and Goldman Sachs – which were made while Mr Geithner was president of the New York Fed.

The Treasury has said Mr Geithner recused himself from the case ahead of a move to the top economic job in the new Obama administration. The New York Fed has emphasised that Mr Geithner played no part in a decision not to disclose details about the AIG payments...Edolphus Towns, the Democratic chairman of the committee, has asked the Treasury secretary to attend a hearing in spite of the administration’s protestations that he was not involved. The Treasury has not yet confirmed that Mr Geithner will attend.

[Tansy_Gold]

33. One way, or another, I'm gonna getcha getcha getcha getcha

http://www.youtube.com/watch?v=74xiXRxkKxc&feature=related

[Demeter]

30. Wall Street titans face the flak

http://www.ft.com/cms/s/0/005cce6e-0049-11df-8626-00144feabdc0.html

Four of Wall Street’s top executives offered some contrition and a defence of their actions on Wednesday, as the head of the Financial Crisis Inquiry Commission promised to use wide-ranging powers to establish the causes of the financial crisis and pursue any wrongdoing.

Lloyd Blankfein of Goldman Sachs, Jamie Dimon, chief executive of JPMorgan Chase, John Mack of Morgan Stanley and Brian Moynihan of Bank of America maintained a united front as the Financial Crisis Inquiry Commission, headed by Phil Angelides, probed the bail-out of AIG, risk management and executive compensation.

Mr Blankfein, whose bank has become a lightning rod for public anger at Wall Street, bore the brunt of the panel’s questions. He mounted a robust defence after being asked whether part of his business was akin to selling a car with faulty brakes and then buying an insurance policy. But he added: “Anyone who says I wouldn’t change a thing, I think, is crazy.”

The Goldman boss said that he and his rivals had been insufficiently sceptical of loose credit standards.

“We rationalised because a firm’s interest in preserving and growing its market share, as a competitor, is sometime blinding – especially when exuberance is at its peak.”

Mr Angelides, a former California treasurer appointed head of the panel by Congress last year, told the witnesses on the first day of public hearings: “We’re after the truth . . . the hard facts . . . we’ll use our subpoena power as needed. And if we find wrongdoing, we’ll refer it to the proper authorities.”....

[Tansy_Gold]

38. I'm sorry, so sorry

http://www.youtube.com/watch?v=iuqrd_Hau4c

[Demeter]

34. FDIC chief blames Fed for crisis IT'S A RUMBLE!!

http://www.ft.com/cms/s/0/0a3b97c8-0114-11df-a4cb-00144feabdc0.html

The Federal Reserve was blamed by a fellow regulator for contributing to the financial crisis on Thursday as the central bank and one of its former chairmen fought back against congressional moves to curb its powers.

In unusually pointed criticism, Sheila Bair, chairman of the Federal Deposit Insurance Corporation, told the Financial Crisis Inquiry Commission that “much of the crisis may have been prevented” had the Fed dealt with subprime mortgages seven years before it did.

In New York, Paul Volcker, former Fed chairman and now White House economic adviser, was making the case for the defence.

He said there was “a compelling case that central banks should have a strong voice and authority in regulation and supervisory matters”.

Both Ms Bair and Mr Volcker carry weight on Capitol Hill, where the Fed has drawn blame for aspects of the crisis.

Mr Volcker told the Economics Club of New York he was “particularly disturbed” about moves to take away the Fed’s regulatory function.

Chris Dodd, Senate banking committee chairman, has proposed consolidating bank supervision into a single regulator.

The Fed published a paper on Thursday, which had been sent to Mr Dodd on Wednesday, arguing that its financial stability and monetary policy roles were complemented by supervising bank holding companies.

Institutions at the centre of the crisis, such as Lehman Brothers, AIG and Countrywide, had been outside its jurisdiction and subject to “far less comprehensive” regulation, it said.

The Fed paper marks a public and proactive stance by a body whose culture and independence from Congress have made it less willing than other agencies to fight for power in the altered regulatory landscape.

It acknowledged some failures but said the Fed was at the forefront of new and improved techniques of oversight, such as “cross-firm, horizontal exams” to assess common exposures and vulnerabilities, and “forward-looking stress testing based on alternative projections for the macroeconomy”.

Mr Volcker said: “What seems to me beyond dispute, given recent events, is that monetary policy and the structure and condition of the banking and financial system are irretrievably intertwined.”

[Demeter]

36. Sharks or Jets?

http://www.youtube.com/watch?v=QpaS2v-r7cE&feature=related

[AnneD]

104. Tapes of Fed meeting uncovered.....

All is revealed......

http://www.youtube.com/watch?v=pq28qCklEHc&feature=related

[Demeter]

57. UK banks face $10bn bill from US over bailouts

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6988902.ece

Three British banks may have to pay more than $10 billion (£6 billion) to the US Government as part of its crackdown on financial institutions bailed out by taxpayers.

Royal Bank of Scotland, which is 84 per cent owned by the Government, may be on the hook for almost $1 billion to the US over the next decade under a stringent new levy announced by the Obama Administration yesterday. Barclays could face a total bill of about $5.6 billion over ten years, while HSBC may have to hand over $3.8 billion, Joseph Dickerson, an analyst at Execution, calculated as the details of the US levy emerged.

The three UK lenders were scrabbling to clarify their exposure to the tax, proposed by President Obama to claw back billions of dollars from banks that have been saved from collapse by state support. If approved by Congress, the new tax — which the White House called a “financial crisis responsibility fee” — would force about 50 banks, insurance companies and large broker-dealers collectively to pay the US Government about $90 billion over ten years. About 35 would be US companies and 10 to 15 US subsidiaries of foreign groups.

Barclays and HSBC are thought to be among the biggest foreign banks to be caught by the tax. RBS’s exposure is smaller than it would have been because it has in recent months reduced its US assets. The UK banks are caught despite not participating in the Troubled Asset Relief Programme because they benefited from systemic support from the US Government.

The tax is set to be on banks’ US assets, less their capital and deposits. The rate, at 0.15 per cent, will effectively be on their wholesale funded business. Mr Dickerson said that along with the bonus tax in the UK, “this is clearly going to be a cost of doing business in the Western world”.

The White House plans to lobby Britain and other G20 nations to introduce their own version of the tax. However, the Treasury said last night that such a tax would not be necessary in Britain, where the Government expected eventually to recover all of the bailout funding provided to banks at the height of the crisis...

[Demeter]

73. Obama’s “Get Tough on Banks” Again Tries to Play the Public for Fools

http://www.nakedcapitalism.com/2010/01/obamas-get-tough-on-banks-again-tries-to-play-the-public-for-fools.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Yves is NOT happy!

[Demeter]

74. Fan Mail

http://www.youtube.com/watch?v=yd_UnE9kXRI&feature=related

[Demeter]

78. Too Big To Fail Tax

http://www.ritholtz.com/blog/2010/01/tbtf-tax/

If you want less of something, tax it.


Yesterday, the news broke about a tax on the large banks — it was ostensibly designed to close the deficit. Instead, I’d like to rename it the Too Big Too Fail Tax (TBTFT).

What I found interesting about the tax is the somewhat misleading way it has been premised — namely, that it is payback for all of the Non-TARP subsidies the banks have been enjoying at the expense of the taxpayers. Further, went the MSM narrative, such a tax at a time of populist outrage over big bonuses is a slick political move calculated to assuage the angry masses.

I am not sure how clever the Obama brain trust is — so far, the answer has been “Not very” — but there is an opportunity here for a third basis for this tax. Let’s call it the TBTF tax.

A brief explanation:

So far, we have learned that Wall Street has become impervious to regulation. Our Parliament of Whores is bought and paid for, well greased by the Street’s lobbyists. Wrap your lips around this big purple legislation and suck. Even the most benign regulation — i.e., a basic disclosure of mortgage costs relative to a plain vanilla, 30 year fixed — has been thwarted.

When lobbying prevents even the most simple of consumer disclosure legislation, you have a broken political system. Such failures can only occur when a democracy has been lost — when corporations own Congress, when the will of the electorate is ignored, when money has utterly corrupted the political process. Have no doubt about this: Our experiment in Democracy is nearly over; we have morphed into a Corporatocracy – a government by and for large corporate interests. Let’s pray it is only temporary.

Pushing regulation through the front door may have become impossible due to this corruption; However, a TBTF tax can be passed because it raises money to close the deficit. It will be difficult to vote against, given all the undirected anger against banks and wall street during big bonus time.

And, here’s the interesting part: It could potentially do more than reduce the deficit — if it goes far enough, it could actually solve the TBTF problem. Exempt small regional banks with under $25 billion in deposits. Make the tax progressive so it become increasingly larger as deposits become greater. $25-$50 billion in deposits is one fee (Let’s say 0.1%, that’s $25 million on $25 billion in assets). Have it scale to the point where its punitive — 1% on a trillion dollars in deposits.

The goal here isn’t to raise money — its to force the TBTF banks to become smaller — to break up the Citigroups and the Bank of Americas. This tax will restore competition to the banking industry.

These jumbo firms are the ones that can and will bankrupt the FDIC; They are the ones that put the entire system at risk. The bailouts reduced competition for them, and allowed a concentration of power that has been unprecedented.

Penalize them.

It could in theory appeal to both parties out of a sense of self-preservation: The GOP recently rediscovered the evils of Deficit Spending (now that they don’t control the White House); Democrats (excepting Clinton) tend to be big tax & spenders, and have usually paid mere lip service against the deficits. But a TBTF Tax could have bi-partisan appeal.

If we as taxpayers are on the hook for past and future excesses of bankers, we have the right to a) protect ourselves and 2) exact a payment, both after the fact and in anticipation of the next crisis.

Despite the theatrics we are likely to see today from the Financial Crisis Inquiry Commission hearing, there is a possible solution. If our broken Congress cannot regulate the Too-Big-To-Fail banks, at the very least, we can tax the hell out of them.

[Demeter]

79. A MEDLEY

http://www.youtube.com/watch?v=hoiz3xb5Bjg

[Demeter]

81. Obama to Announce $120 Billion TARP Fee (ALREADY REDUCED TO 90B)

http://www.nakedcapitalism.com/2010/01/obama-to-announce-120-billion-tarp-fee.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29


Ah, the machinations that Faustian bargains produce!

The Obama Administration is now caught in its own machinations and is having to backpedal fast and hard from its bankster friendly posture, or at least have the public believe it is executing that maneuver.

While I cannot fathom the logic, Team Obama clearly decided to throw in its hat with the industry from the beginning, supporting a whole raft of tricks to keep banks from recognizing losses (heavens, might expose that some were bankrupt and require that incumbents be given the heave ho!). It also assisted in the “talk up the bank stocks” effort, since goosing prices would allow some banks to sell shares and save the new Administration the unpleasant task of figuring out how to resolve and recapitalize the sickest bank. It never seemed to occur to them that the best time for a President to take unpopular but productive action is at the start of his tenure. Nor did they anticipate that the public was not as dumb and inattentive as they assumed, and has taken notice of how the Administration has hitched its wagon to that of the plutocrats.

Now some readers might argue that, gee, things look better than the did in March, surely this Team Obama program was not such a bad idea. Well, actually, it was and is. The record of serious financial crises shows that regulatory forbearance (which is letting banks soldier on with the hope they will earn their way out of their messes over time) is more costly than forcing them to recognize losses and recapitalized them. Not only are the ultimate bailout costs higher with the “let ‘em off easy” approach, but economic recovery is weaker too.

Team Obama is now having the contradictions in its stance exposed. If the banks were really healthier due to their own efforts, the salvos against them would be unwarranted. Here they had gone over the brink, pulled themselves up by their bootstraps. All these complaints about their earnings and bonuses are mere class jealousy. But no one save the banksters themselves believe that tripe. The banks got massive subsidies during and after the crisis; they continue now with the Fed’s super low rates and continued intervention in the mortgage markets (theoretically ending in March, but most informed observers expect the central bank to blink).

But Team Obama does not want to play up the extent to which the industry has benefited from public munificence; that only stokes the deserved and correct public anger, which includes the Administration for cutting such a crappy deal with the industry. So it has the PR conundrum of having it be beneficial for political reasons for them to beat up on the financiers, but now being so deeply aligned with them as to make that impossible, save perhaps on a few narrow issues that it hopes will have sufficient peasant-appeasement value. Any full-bore attack would represent an embarrassing change from the Administration’s past fawning posture, and would also require the sacrifice of a senior head or two, presumably starting with Timothy Geithner, to look credible. But Obama seems constitutionally incapable of firing anyone, no matter how much it would serve him to do so.

The sketchy announcement du jour, that Obama will announce a $120 billion TARP fee this week (hhm, conveniently timed to distract attention from the start of the hearings into the crisis and Wall Street bonus announcements) illustrates the bizarre position the Administration is in. Alert readers may recall that Obama was touting the performance of the TARP at his Lehman anniversary speech in September. It repeated that palaver in December. As we noted then:

Both Obama and the Treasury Department keep talking up the TARP as if it is a money maker for taxpayers, when nothing could be further from the truth. Obama tried this stunt in his anniversary of Lehman speech, and the Treasury continues with the theme, of implying that results for the firms that paid back are representative of what the final results would be.

If this logic were generally true, that would mean subprime bonds were a good investment too. After all, most borrowers did make good on their mortgages. A late September Moodys mortgage survey that a reader sent me estimated that total losses on subprime RMBS will be about 26%, which means that 74% were money good.

The problem with the Treasury/Obama three card monte is that the strongest TARP are the ones that paid off first. Things can only go downhill from here. Do you expect AIG to repay the TARP in full? Or the auto companies?

... They are now talking about TARP “bank only” results, which serves to omit the biggest turkeys.

So let’s return to today’s story and the PR corner that Team Obama has painted itself in. It isn’t willing to do the UK thing and decry banker bonuses as irresponsible and unwarranted. It had Kenneth Feinberg, the pay czar, take a few scalps, but it was clear the Administration had no intention of challenging the financial industry’s right to loot and pillage. It isn’t even willing to say the profits are due almost entirely to subsidies, hence a windfall profits tax (presumably one focused on capital markets operations, that’s where the real juice is) is in order. Heavens, that might lead chump investors to question bank valuations and sell stocks! Horrors, can’t have prices that reflect fundamentals when the Administration has been pointing to the improvement in the financial markets as proof its policies are working.

So the finesse is now to admit, in a reversal of its recent posturing, that yes Virginia, the TARP is losing money (this is the first time they have admitted the obvious). So that means banks need to pony up more for the cost of their rescue. Of course, we omit the complicating factor that AIG has been the biggest black hole, that the deal was retraded four times (or is it five now, I am losing track), and some money flowed through AIG to foreign banks like Societe Generale and Deutsche Bank, who will not participate in this little levy.

Notice how this finesse keeps the focus on the TARP, the program the public already hates, and diverts attention from the man-behind-the-curtain stuff the Fed has been up to, or the FDIC guarantees on bond issued by the likes of Goldman.

Thin details as of this hour. From Reuters (hat tip reader Ray D):

President Barack Obama will announce plans on Thursday to raise up to $120 billion from major U.S. financial firms to cover expected losses from a taxpayer-funded bank bailout, a senior administration official said on Tuesday…

The Obama administration official said the amount of money raised from the fees would not exceed $120 billion since this was the higher end of conservative estimates of the cost of the Troubled Asset Relief Program, or TARP.

U.S. Treasury officials expect TARP losses to be much lower than that sum…

Bloomberg has the same sketch, save suggesting the announcement will come Wednesday, and more stage-setting quotes:

“The politics on this is really quite easy,” said Doug Elliott, a fellow at the Brookings Institution in Washington and a former managing director at JPMorgan Chase & Co. “The public would be supportive of anything up to shooting and burning the bankers.”

Up to? Elliot has clearly underestimated how upset some people are.

[Tansy_Gold]

102. My life will never be the same

A bit later than the '60s/70s, but still. . . . The girls get it done.


http://www.youtube.com/watch?v=WCkOmcIl79s

[AnneD]

89. owah owah ditty....

I think I've found a theme song for Obama-if he lives up to it. Or maybe Elliot Spitzer-he has proven he has the stuff..

/www.youtube.com/watch?v=eTMgWRK7ee0

[Demeter]

93. That's Dimon (And Blankfein)

The Sharks.

[AnneD]

94. Song is too cool.....

for scum.

[Demeter]

19. China's Acting Up: Cyberattacks aimed at defence groups

http://www.ft.com/cms/s/0/f03470e8-00cd-11df-a4cb-00144feabdc0.html

The cyber­attacks that have compromised computers at Google and other US technology companies doing business in China have also been aimed at extracting secrets from defence contractors, investigators said on Thursday.

Malicious software on machines at companies attacked in the latest blitz sent proprietary data off to six web addresses in Taiwan that had received information from US defence groups before.

The defence companies had been attacked using methods similar to those deployed against nearly three dozen high-tech groups including Google, which went public with the spying matter this week, pointing a finger at the Chinese government...

[Demeter]

20. Google ripple effects rock net generation

http://www.ft.com/cms/s/0/4cea3bae-0134-11df-8c54-00144feabdc0.html

....A clumsy public battle with Google could have all sorts of unpredictable consequences. Google may have been on the losing end commercially, but its presence in China has symbolic importance. Censorship or not, the internet has been a central part of the package of China-style modernity that the government has offered the educated middle class: an emblem of engagement with the world. Yet over the past six months, net users have seen Twitter, Facebook and YouTube all blocked. And many in the academic community, in particular, have been stunned by the punishment meted out to Liu Xiaobo.

A Google withdrawal would feel to some like a further turn inwards. As one blogger put it: “It’s not Google that is withdrawing from China – it’s China that’s withdrawing from the world.”

NO LESS TRUE FOR US PEASANTS IN THE US--YOU CAN TAKE AWAY THE INTERNET WHEN YOU PRY IT FROM OUR COLD, DEAD HANDS.

[Demeter]

59. Google vs. China: All the possible WHYs?

http://chinayouren.com/en/2010/01/14/2743?utm_source=feedburner&utm_medium=email

I know, there are other news in the World, and I am probably not paying enough attention to them. But I can’t help it, I’ve been overclocking for the last 48h trying to understand Google’s decision, I have read every single article appeared on the internet since. And I still don’t get it.

I want to make this a collaborative page, I will keep it on top and I would appreciate comments with clues and POVs I might have missed. The objective is to come up with reasonable hypothesis and then cross out the wrong ones. I will also add interesting bits of info below as they come out:

Hypothesis: Why did Google stand up to the CCP? (UPDATES Below)

Business: We have seen that, with the info in hand, the decision doesn’t make sense from a pure business perspective. Who knows, you might say, perhaps the goodwill earned in the West will end up compensating for the loss of China, perhaps democracy will come soon. Yes, que sera sera. But that’s not how decisions are taken in business. There is a profit and a risk to consider, and when the gain is so uncertain and the loss so clear, it doesn’t make business sense. More on this below.

Ethical: Yes, “don’t do evil”, I know. Hello, all the corporations today have CSR and ethical codes, mine too, even if it is not as cool as Google. But really, a company doesn’t have feelings, it doesn’t respond to notions like love or ethics. Only people do that. And, in the case of Google, only Page, Brin and Schmidt have that kind of power. Did they suddenly get pangs of conscience and decided to follow their own principles at any cost? Some already suggest this might have been a personal decision influenced by Sergey Brin. More on the personal hypothesis below.

Checkmate: Google has some information about the Chinese industrial espionage activities that is still undisclosed, with evidence that would compromise the CCP, and possibly push it against the wall in some WTO proceeding. The victims include dozens of Western companies, and the crime is so outrageous that all those countries would be forced to stand up to the CCP as well. This could be Google’s ace in the hole, and it would explain the style of their blog post. This is the only winning hypothesis for the G. It deserves strong consideration, based on the premise that the 3 leaders of Google are Very Intelligent Guys.

Legal: The muddled style of the message and the bad moment chosen (we should be speaking of Nexus One right now!) makes me think that there might have been some pressing matter that pushed Google to do this. Like we said, the same goodwill could have been obtained by simply uncensoring Google.cn without writing a public accusation to the CCP. Is this a move to deslegitimate the Chinese system and avert an upcoming Chinese lawsuit? Did some of the activists threaten to sue Google for the leaks, or was it the Chinese authorities that were getting dangerous? Google Books? Porn on Google Images?

Political: We saw as well that the most likely political outcome is an increase of censorship in China, a net loss for the employees of Google and the Chinese netizens, and perhaps even a rise of nationalism and protectionist policies. There is no way that this move is going to help the Chinese in the short term. Even if there was: it is not and it can not be the role of a public company to actively engage in politics hand in hand with the US government. Need I remember anyone that the US government is today responsible for evil as severe as the CCP? More news here.

IP Protection: Google might have decided to force its way out of China because really it has detected some theft of IP so severe that it puts in danger the whole business. It is hard to believe that Google is unable to hide its own IP from the Chinese government. We are speaking of the same government that couldn’t even come up with a decent filtering software last year. Let’s just say this option is unlikely. Update: this hypothesis is stronger after rumour of a CCP mole, see Update 2 below.

Conspirational: Google has something to hide. It is something very big and very very weird, like E. Schmidt is an alien, or an irrecoverable bug has been found on Larry’s algorithm, or a Google databank in the US has been held by AlQaida and… and all this noise is just to distract our attention. This would be consistent with the quick messy post at the Google blog.

Personal: Larry Page and Sergey Brin are among the most admired persons in the universe, they are the Gods of the internet. They achieved that at a very young age, and they have spent the last decade sitting on the Google Search cash cow and freely recruiting the best intelligences in the World to conquer the internet and get more universal love than Jesus Christ. Their egos are shooting through the Googolplex roof, and they have decided to bring democracy back, coz them other CEOs don’t know how to act. Girl.

Macroeconomic: Google has obtained insider info on the financial position of some Chinese Banks and the superhuman brains of P and B have come up with a new algorithm predicting that the Chinese system is going to collapse tomorrow. They leave while they are still in time, collecting bonus World goodwill and defying a CCP that will not be there this time next year anyway…

Various/Spectacular: From Daily Beast via BoingBoing: “the reason they know it’s the Chinese government behind these attacks is because Google gave them the key”, “Your entire life, as stored on Google’s servers, may now be there for the taking.” and “Google is attempting to create a distraction.” Also from Posner in Daily Beast: The Red Menace is back, Google thwarts China’s plan to control the World with an army of hackers.

UPDATE: Danwei has collected some informations regarding the low profit that Google is getting in China. This would give some weight to the Business option above. However, it still doesn’t make any sense. They could have just uncensored Google.cn, get sent away with all the PR hoopla, and all the while not cross the CCP too much with the public accusations of email hacking. Because there is ABSOLUTELY no business interest in Google forcing things in a way that even Google.com and all the G services will be blocked. China can do that easily with the GFW.

UPDATE 2: The moles theory. ESWN translates from anonymous Chinese blogger claiming insider info: Google trusts its employees and gives them access to all the codes, suddenly discovered one of the employees is actually a CCP mole who’s been passing information, not only about activists but also Google’s own IP (actually from the initial G’s post it is not clear which of the two problems has moved Google).

Rings true to me, and explains why all employees in China are being sent on holidays. And yet, this doesn’t change much the situation. Wasn’t it pretty obvious that Google had CCP spies all along? Every company here has members of the CCP working in it, mine as well. And it is difficult to believe G was so naive as to not take precautions against this.

Moreover, the kind of people that work in Google are the best of the best universities, a high percentage of those people are members of the party here. The surprising thing would have been that there was NO moles in Google China.

I don’t think the big deal is the mole. Whether the hacks were done through moles or through other means is secondary, what is essential to the issue here is the Magnitude of the IP theft, and the Evidence G has, and possibly the other Companies involved. For the POLL, this theory is included in the IP Protection option above.

UPDATE 3: (h/t CDT) Newsweek interview Eric Schmidt: Decision based on values, not business. Mentions monitoring of dissidents, not technology IP theft. Says Google’s IPO specified Google would be different, maximizing profits was not the objective of Google Inc, so no responsibility to the shareholders.

But why why why now? And why such a bad form? Like I said already, they could have done things more smoothly, and avert the risk of being completely banished from China. And why now, when the treatment of dissidents is known in China for years? Does it make any difference if hacks are done through a mole in Gmail or through Baidumail once Google is gone. And wouldn’t the right thing be to fight, and encrypt the email better, and give those dissidents a mich needed support to stay alive? All points to personal+ethical option.

Feel free to suggest other hypothesis, or else just vote below: SEE LINK TO VOTE

[Demeter]

83. Google's puzzling logic

http://www.bbc.co.uk/blogs/thereporters/robertpeston/2010/01/googles_puzzling_logic.html

For many, what's endearing about Google is that it doesn't conduct business like most big multinationals.

Most big multinationals, for example, wouldn't go to war against China's freedom-of-speech policies via a blog - which is what Google has done.

Some might also argue that Google's argument in its blog isn't over-burdened with logic.

The "don't-be-evil" company starts by disclosing that "in mid-December, we detected a highly sophisticated and targeted attack on our corporate infrastructure originating from China that resulted in the theft of intellectual property from Google".

Google investigated and discovered there had been similar attacks on "at least twenty" other big companies (unnamed), in a great range of sectors (finance, chemicals, technology, media).

So far so chilling.

But, apparently, this wasn't a classic attempt to steal industrial secrets. The prime motivation was it seems to hack into the Gmail accounts of "Chinese human rights activists" - although Google has not made explicit whether that was the purpose of the cyber raids on all the affected companies, or just the attack on Google.

That said, Google is confident that the hackers were unable to retrieve any material information from this malign initiative. But its probe did discover that "the accounts of dozens of U.S.-, China- and Europe-based Gmail users who are advocates of human rights in China appear to have been routinely accessed by third parties."

It says that these accounts were probably accessed using phishing scams or malware rather than through a breach of Google's own security arrangements.

All of which is pretty shocking.

But Google then makes a slightly curious leap.

It says "these attacks and the surveillance they have uncovered - combined with the attempts over the past year to further limit free speech on the web - have led us to conclude that we should review the feasibility of our business operations in China."

It says it will pull out of China unless the Chinese authorities belatedly allow it to run an "unfiltered" search engine there. No longer will Google collaborate in censoring access to websites and online information deemed by the Chinese government to be harmful to the state.

Which, on the face of it, is not a logical reaction. Some Google shareholders (those who put a higher premium on profits than on democratic rights) will see this as a commercial example of cutting off your nose to spite your face - because it is not remotely clear how a withdrawal from China by Google would enhance the privacy of Chinese human rights activists.

Of course, there is the power of theatre. Google's statement that it wants an unfettered Chinese search engine or none at all is certainly a big bold gesture that shines a light on systematic infringement of freedom of expression in that country.

But most campaigners for this freedom would argue that Google should never have agreed to be censored when launching its China service in January 2006.

And I suppose cynics would point out - and I'm not one of them - that China is an unusual market for Google in a second sense: Google doesn't dominate the search market there; it's the number two with a 31% share, way behind Baidu's 64%.

So Google's discovery that there are moral imperatives which outweigh the profit-motive should not be as expensive as it might have been.

[Robbien]

86. It's just their ego

Google ranks a distant second to the Baidu search engine which is the most widely used search engine in Asian countries.

Google does not like not like being Hertz and it will NOT try harder, it's GOOGLE.

[AnneD]

90. Baidu...

or Badu

/www.youtube.com/watch?v=eTMgWRK7ee0

OK I took some liberties. And so did Tyrone. Damn I love me some Erica.

[Demeter]

32. Chinese property prices spike

http://www.ft.com/cms/s/0/39652b00-00e1-11df-a4cb-00144feabdc0.html

Housing price appreciation accelerated in China in December, climbing 7.8 per cent from the same month a year earlier and prompting new government measures as Beijing attempts to slow soaring prices without derailing the economic recovery.

Average prices in 70 large and medium-sized cities across the country rose 1.5 per cent from November, the National Development and Reform Commission said on Thursday.

The increase was the fastest in 18 months. In November, average prices rose 5.7 per cent year-on-year and the rise was 1.2 per cent in October.

Most analysts and even a growing chorus of real estate developers say a bubble has already formed in China’s property market, driven mostly by the huge surge of easy credit pumped into the economy by state-owned banks during the last year.

New loans extended in 2009 more than doubled from 2008 to about Rmb10,000bn as the government ordered the banks to support flagging growth in the face of the financial crisis.

In response to a question from the Financial Times, Qi Ji, China’s vice-minister of housing and urban-rural development, this week refused to say whether he thought a bubble had formed in the property market. But he said prices of housing, particularly in large coastal cities, had already reached levels that were “obviously too high”.

Beijing is responding by enforcing policies to limit speculative investments in real estate and ordering local governments to increase the supply of affordable housing, he said.

[Demeter]

23. Slim launches bid to consolidate telecoms empire (MEXICO)

http://www.ft.com/cms/s/0/49022d60-00f0-11df-a4cb-00144feabdc0.html

Carlos Slim, the world’s third richest man, has launched a $24.6bn bid to consolidate his telecommunications empire.

América Móvil, Mr Slim’s Latin American mobile phone operator, is planning a takeover of the fixed-line phone groups he controls.

Some analysts said the move suggested América Móvil was waving goodbye to the double-digit growth it enjoyed between 2001 and 2008, and was instead looking to secure cost savings by combining with his fixed-line companies.

“Fixed/wireless integration simply confirms that the days of . . . double-digit growth rates are behind us and that from now on, the business model is likely to involve the ‘hard grind’ of squeezing costs,” said Viktor Shvets, an analyst at Nomura.

Telecoms is a key part of Mr Slim’s sprawling business interests, which also span banking, mining and retail. According to Forbes, he has a net worth of $35bn.

América Móvil’s growth is slowing because mobile phone ownership in Latin America is no longer in its infancy. More than 80 per cent of people in the region now have a mobile, according to Informa.

Growth is also slowing because of fierce competition and, to a lesser extent, regulatory pressure. Mr Slim’s longstanding rival in Latin American telecoms is Spain’s Telefónica, but he is also facing new entrants, such as France’s Vivendi.

América Móvil is seeking control of Telmex, Mexico’s leading fixed-line phone company, and Telmex Internacional, which provides similar services across Latin America....

[Demeter]

41. Fitch: U.S. Prime Jumbo RMBS Delinquencies Nearly Triple to 9%; CA Drives Trend

http://www.earthtimes.org/articles/show/fitch-us-prime-jumbo-rmbs,1116924.shtml

More U.S. prime jumbo borrowers are falling and staying behind on their monthly mortgage payments, with states such as California and Florida driving the elevated underperformance, according to Fitch Ratings in the latest edition of its U.S. RMBS delinquency updates through Performance Metrics.

Overall, prime RMBS 60+ days delinquencies rose to 9.2% for December 2009, up almost three times compared to the same period last year (3.2% in December 2008). The 2006/2007 vintages combined rose to 12.7% from 4.3%.

The five states with the highest volume of prime jumbo loans outstanding (California, New York, Florida, Virginia, and New Jersey) comprise approximately two-thirds of the loans in question. Prime jumbo RMBS 60+ days delinquencies for these states at December 2009 compared to December 2008, and their approximate share of the $388 billion market, are as follows:

--California: 10.8%, up from 3.5% (44% share)

--New York: 5.8%, up from 1.8% (7% share)

--Florida: 16%, up from 7.3% (6% share)

--Virginia: 5.4%, up from 2.3% (5% share)

--New Jersey: 7.1%, up from 2.3% (4% share)

Prime jumbo borrowers that were current on their mortgage the previous month but missed a payment the following month (roll rates) averaged about 1% a month for the last 12 months, reaching a seasonal high of 1.3% in December 2009. 'While some of these borrowers caught up, many either remained a payment late or became more delinquent in the succeeding months,' said Managing Director Vincent Barberio.

Despite some improvement in home prices and a slowdown in employment loss, roll rates have not improved primarily due to the number of prime jumbo borrowers who owe more on their mortgages than their home is worth. 'Over one-third of prime jumbo borrowers that are current on their mortgages also are 'underwater' on their mortgages,' said Barberio.

[Demeter]

46. Severe unemployment worsens in cities

http://money.cnn.com/2010/01/05/news/economy/metro_unemployment/index.htm?source=ft

The number of U.S. metropolitan areas with jobless rates above 15% increased in November, according to government figures released Tuesday, despite the biggest one-month drop in the national rate in more than three years.

The Labor Department said 17 of 372 metropolitan areas surveyed suffered unemployment rates of at least 15% last month, up from 15 metro areas in October.

National unemployment improved to a seasonally adjusted 10% in November from the 26-year high of 10.2% hit in October. The rate had climbed for 12 out of the previous 13 months before November. Economists surveyed by Briefing.com expect the national rate to edge up to 10.1% when the Labor Department releases its December jobs report Friday.

Three areas in Michigan posted jobless rates higher than 15%, including Detroit. The city wrecked by the collapse of the auto industry continued to lead the nation's areas of 1 million people or more with the highest unemployment rate in November at 15.4%.

California's Inland Empire, including Riverside, San Bernardino and Ontario, ranked second to Detroit among larger areas with an unemployment rate of 14.2% in November.

El Centro, Calif., held its place as the metropolitan area with the highest unemployment rate at 29.2%, down from an upwardly revised 31.9% in October.

The second highest rate was in Yuma, Ariz., at 21.1%, a drop from 23.3% in October.

Jobless rates were higher than 10% in 125 metropolitan areas in November, up from 123 in October.

Overall, 143 cities in the Labor Department report had unemployment rates above the non-seasonally adjusted national figure of 9.4%, while 229 reported jobless rates below it.

The three metro areas with the lowest unemployment rates in November were all in North Dakota, with Bismarck at 3.4%, followed by Fargo and Grand Forks at 3.7%.

Large cities with the lowest jobless rates were New Orleans and the Washington, D.C. metro areas, each at 6.1%. Oklahoma City followed close behind with an unemployment rate of 6.4%.

[Demeter]

47. New Year in America: A Portrait of Social Misery

http://www.wsws.org/articles/2010/jan2010/soci-j05.shtml

...The new decade finds the US working class suffering a level of social misery not seen since the Great Depression. Unemployment, poverty, hunger, utility cutoffs, homelessness, foreclosures and bankruptcies have become common experiences for millions.

But unlike in the Great Depression, when limited reforms were put in place in response to the crisis, the Obama administration, Congress, and state and local governments are taking no serious measures to provide relief. On the contrary, the two parties of big business are exacerbating the crisis through budget cuts at the state and local level and the federal government is preparing new austerity measures....

[Demeter]

42. Engineering Poverty: Food Stamp Profits?

http://www.informationclearinghouse.info/article24382.htm

Video interview

[Demeter]

50. Ain't No Mountain High Enough By Diana Ross & The Supremes

http://www.youtube.com/watch?v=ph5iadqH3Eg&feature=related

[DemReadingDU]

107. Supremes - Mary Wilson solo and Love Child very rare

Very rare clip of The Supremes performing "Can't Take my Eyes off of You" with Mary Wilson on lead. Diana Ross and Cindy Birdsong join Mary for a very unusual/special rendition of Love Child with special guests on stage!! The show aired on October 18, 1969

http://www.youtube.com/watch?v=5HrLoz9dlU0

[Demeter]

43. US Must Cut Spending to Save AAA Rating, Warns Fitch

http://www.informationclearinghouse.info/article24383.htm

Fitch Ratings has issued the starkest warning to date that the US will lose its AAA credit rating unless acts to bring the budget deficit under control, citing a spiral in debt service costs and dependence on foreign lenders.

By Ambrose Evans-Pritchard

January 12, 2010 "The Telegraph" -- Brian Coulton, the agency's head of sovereign ratings, said the US is shielded for now by its pivotal role in global finance and the dollar's status as the key reserve currency, but the picture is deteriorating fast enough to ring alarm bells.

"Difficult decisions will have to be made regarding spending and tax to underpin market confidence in the long-run sustainability of public finances. In the absence of measures to reduce the budget deficit over the next three to five years, government indebtedness will approach levels by the latter half of the decade that will bring pressure to bear on the US's 'AAA' status", he said.

Fitch expects the combined state and federal debt to reach 94pc of GDP next year, up from 57pc at the end of 2007. Federal interest costs will reach 13pc of revenues, meaning that an eighth of all taxes will go to service debt. Most fiscal experts view this level as dangerously close to the point of no return for debt dynamics.

The rating alert is a reminder that fiscal stimulus and bank rescues across the world have merely shifted private debt on to public shoulders. The bail-outs looked deceptively 'costless' at the time, but the damage to sovereign states may take years to repair. The US Treasury says interest payments as a share of GDP will rise to 3.6pc by 2016, the highest since data began in 1940 – when it was 0.8pc.

Mr Coulton said the US is vulnerable to "potential interest rate shocks" due to its reliance on short-term debt and foreign investors. The average maturity of US government debt has fallen to four years, compared to seven for Europe's AAA club, and 10 for Britain. "The share of three-month bills has risen very sharply as a result of recapitalising banks," he said.

This raises the danger of a roll-over crisis. Chinese, Japanese, and Mid-East investors own almost half of the stock of US debt. They are more likely to liquidate holdings than domestic investors, if there were a loss of confidence in Washington or the Federal Reserve. Short maturities mean that any jump in interest rates will be felt quickly.

Stephen Lewis, of Monument Securities, said a US downgrade would rip the anchor from the global system and pose a grave risk to the stability. "This would set off tremors, making all dollar assets less secure. You could argue that the reason why the rating agencies have not already downgraded the US and Britain is that they fear the consequences for the global economy if they pull the trigger," he said.

While US debt was higher after World War Two, circumstances were very different. The age structure was healthier. Most bonds were held by Americans. Demobilisation of the troops allowed for drastic budget cuts. America had emerged as the world's strategic and economic Colossus. This time the US cannot rely on exuberant growth to whittle down the debt.

[Tansy_Gold]

45. He's a Rebel

Written by the late great Gene Pitney


http://www.youtube.com/watch?v=ftSrov-6GEQ

[DemReadingDU]

95. da doo ron ron da doo ron ron

crystals 60's girls group singing their hit
http://www.youtube.com/watch?v=dqgtsai2aKY

[fasttense]

113. So where was Fitch Ratings on those sub-prime sliced and diced securities?

Where was Fitch Ratings when the bushes were running up piles and piles of debt?

How come it's only when the little guy gets a drop of relief that rating agencies come out and threaten down grades? This is just so convenient for the uber wealthy and their "free" trade brain washed minions.

[mbperrin]

115. A rush to the exits would lower interest rates, regardless of ratings.

Many sellers, not many buyers, means prices fall on any commodity. Price of money is interest. I've been thinking for a while that some of the seemingly bonehead moves by the US are actually attempts to get shaky investors to sell at any price. This would save the US government (you and me) billions in interest in the short term, and it would put those takers in a great position when interest rates recover (if they do). And I think the takers here are on shaky ground. I'm not one of the masters of the universe who would be snapping up those "cheap" securities. We long ago abandoned artificial instruments for our own investment purposes.

Ratings are not as important as relative demand, especially when demand is being driven by other factors.

[Demeter]

44. IMF provides USD 100 in emergency assistance to Haiti

http://www.kuna.net.kw/NewsAgenciesPublicSite/ArticleDetails.aspx?id=2054449&Language=en

The International Monetary Fund (IMF) will provide USD 100 million "very rapidly" in emergency financing to Haiti to assist it in dealing with the aftermath of the massive and devastating earthquake that has hit the country, it was announced here Thursday.

The IMF indicated that the USD100 million in new funding is subject to approval by the IMF Executive Board, which could consider the augmentation under accelerated procedures.

IMF Managing Director Dominique Strauss-Kahn said in a statement that he asked staff members "to look into all the possibilities and I am pleased to announce that we are able to make USD100 million available very quickly." "We are coordinating with other international agencies to mobilize assistance as quickly as possible in order to help Haiti with the difficult task ahead of rebuilding the country," he added.

Strauss-Kahn, on behalf of the IMF, offered his "deepest sympathy to the victims of this tragedy." According to the institution, the emergency financing would be provided as an augmentation to the existing IMF-supported arrangement with Haiti under the Extended Credit Facility, formerly the Poverty Reduction and Growth Facility (PRGF).

Since 2006, the IMF has disbursed close to USD170 million under its PRGF-supported arrangement. The program was approved in November 2006 in an amount equivalent to about USD114.4 million.

In June 2008, an augmentation of about USD 25.4 million was approved to help Haiti cope with the impact of high international food and fuel prices.

A second increase in IMF financial assistance, of about USD38.1 million was approved by the Executive Board in February 2009 to help mitigate the negative effects of a series of hurricanes in 2008, as well as the global downturn.

Haiti received USD 1.2 billion in debt relief in June 2009, as it reached the completion point under the Enhanced Heavily Indebted Poor Countries Initiative approved by the Executive Boards of the IMF and the World Bank.

[Demeter]

49. “It Takes a Pillage: By Nomi Prins

http://www.informationclearinghouse.info/article24376.htm

Behind the Bailouts, Bonuses, and Backroom Deals From Washington to Wall Street”

Video interview

[Demeter]

51. Bedtime! See you All in the AM

http://www.youtube.com/watch?v=10n3qMMDlrk&feature=related

[Tansy_Gold]

52. Dream a Little Dream

http://www.youtube.com/watch?v=MWZfKcYlefE

[Po_d Mainiac]

54. So much for the ear worm from yesterday going away :frown:

Bobby and Judy are really gettin on my nerves

[Demeter]

55. Could you be more detailed?

Maybe I can at least not make it worse....

[Po_d Mainiac]

64. The worm's been chompin on the inner ear for over 24hrs

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4226271&mesg_id=4226398

Chainsaws a Diesel engine and dropping a few trees didn't help.....Maybe Reba McEntire's "The night that the banks went out in Georgia" can be the bird that ate the worm. :hi:

[Demeter]

56. Moral Bankruptcy

http://motherjones.com/politics/2010/01/joseph-stiglitz-wall-street-morals


Why are we letting Wall Street off so easy?

— By Joseph E. Stiglitz

Joseph Stiglitz' new book, Freefall: America, Free Markets, and the Sinking of the World Economy, is in stores as of Monday. You can find it online at Powell's.

IT IS SAID THAT A NEAR-DEATH experience forces one to reevaluate priorities and values. The global economy has just escaped a near-death experience. The crisis exposed the flaws in the prevailing economic model, but it also exposed flaws in our society. Much has been written about the foolishness of the risks that the financial sector undertook, the devastation that its institutions have brought to the economy, and the fiscal deficits that have resulted. Too little has been written about the underlying moral deficit that has been exposed—a deficit that is larger, and harder to correct.

One of the lessons of this crisis is that there is a need for collective action, that there is a role for government. But there are others. We allowed markets to blindly shape our economy, but in doing so, they also shaped our society. We should take this opportunity to ask: Are we sure that the way that they have been molding us is what we want?

We have created a society in which materialism overwhelms moral commitment, in which the rapid growth that we have achieved is not sustainable environmentally or socially, in which we do not act together to address our common needs. Market fundamentalism has eroded any sense of community and has led to rampant exploitation of unwary and unprotected individuals. There has been an erosion of trust—and not just in our financial institutions. It is not too late to close these fissures.

How the market has altered the way we think is best illustrated by attitudes toward pay. There used to be a social contract about the reasonable division of the gains that arise from acting together within the economy. Within corporations, the pay of the leader might be 10 or 20 times that of the average worker. But something happened 30 years ago, as the era of Thatcher/Reagan was ushered in. There ceased to be any sense of fairness; it was simply how much the executive could appropriate for himself. It became perfectly respectable to call it incentive pay, even when there was little relationship between pay and performance. In the finance sector, when performance is high, pay is high; but when performance is low, pay is still high. The bankers knew—or should have known—that while high leverage might generate high returns in good years, it also exposed the banks to large downside risks. But they also knew that under their contracts, this would not affect their bonuses...

LONG READ BUT WORTHY OF YOUR ATTENTION

[Tansy_Gold]

69. The girls of the 60s (and 70s and 80s) and why we matter

I was up up the rest of the night writing this post.

Hillary Rodham Clinton is a boomer. Born 26 October 1947, she's not quite a year older than I am. She grew up in Park Ridge, Illinois, the same Chicago suburb I lived in until the age of 3. She attended Maine East High School (it was Maine Township when my mother (Class of '47) and uncles went there), which was in the same athletic conference as my high school, Arlington. Who knows? We might have been at the same football or basketball games; she graduated in '65, I in '66.

So when Hillary ran for president in 2008, I supported her not because I agreed with her on every issue or thought she was right on every issue but because I understood why she -- and so many women of our generation -- seem to be such contradictions inside of contradictions.

How could she be a "liberated" strong career woman and still put up with Bill's screwing around? How could someone like that possibly make a "good" president?

How indeed? Because like the rest of us in that early boomer generation, we grew up in a chaos of cultural messages and we learned to negotiate them. We were born into those post-war nuclear families, but most of us didn't marry into them. Easy divorces left many of us as single mothers fighting for jobs that paid a lot less than men's jobs did.

But we had grown up in an age of paradox, of I Dream of Jeannie and Bewitched, of Kent State and My Lai, of John and Bobby and Martin, Gloria and Bella, Jackie and Twiggy and Diana (Ross, not that other one).

Things changed. Attitudes changed. People were no longer stuck where they'd been, were no longer confined to pre-conceived roles that society had been comfortable with. Shirley Temple became an ambassador. Neil Armstrong walked on the moon. Betty Ford admitted she had an addiction.

The wartime victories that our parents had celebrated when the troops came home en masse never materialized for our generation. Vietnam was as much a paradox as anything else in our lives. The dead had always come home one by one, but the victors had always come home together, the comradeship born in combat now serving to ease the transition back into civilian/civilized life. But our war, the Vietnam war, was different. Our boys came home alone, with neither victory nor comrades nor celebration to smooth the road back. We had no models to turn to in dealing with their trauma, nor in the way our neighborhoods and families, communities and even our nation treated the veterans of our generation.

As we entered our political maturity, we had more contradiction inside contradiction. We had Gene McCarthy and George McGovern, we had Richard Nixon and Lyndon Johnson and Barry Goldwater. Johnson escalated the war but also escalated civil rights legislation and the War on Poverty and Head Start. And Nixon, who gave us the EPA, resigned in disgrace without giving us peace in our time. And we lost in Vietnam.

So what is it that held us together, the American women of this generation, the ones who came into adulthood during those tumultuous years of 1963-1975, from King's march on Washington and the JFK assassination and the advent of the Beatles to the fall of Nixon and Saigon?

Susan J. Douglas wrote, in 1994 in "Where The Girls Are: Growing up Female with the Mass Media":

OK – here's a test. Get a bunch of women in their thirties and forties and put them in a room with a stereo. Turn up the volume to the "incurs temporary deafness" level and play "Will You Still Love Me Tomorrow?" and see how many know the words – all the words – by heart. If the answer is 100 percent, these are bona fide American baby boomers. Any less, and the group has been infiltrated by impostors, pod people, Venusians. But even more interesting is the fact that non-baby boomers, women both older and younger than my generation, adore this music too, and cling to the lyrics like a life raft.

Why is it that, over thirty years after this song was number one in the country, it still evokes in us such passion, such longing, such euphoria, and such an irresistible desire to sing very loudly off key and not care who hears us? And it's not just this song, it's girl group music in general from "He's So Fine" to "Nowhere to Run" to "Sweet Talkin' Guy." Today, the "oldies" station is one of the most successful FM formats going, in no small part because when those songs come on the radio, baby boomers get that faraway, knowing, contented look on their faces that prompts them to scream along with the lyrics while running red lights on the way home from work. None of this is silly – there's a good reason why, even on our deathbeds, we'll still know the words to "Leader of the Pack."

First of all, girl group music was really about us – girls. When rock 'n' roll swiveled onto the national scene in the mid-1950s and united a generation in opposition to their parents, it was music performed by rebellious and sexually provocative young men. Elvis Presley was, of course, rock 'n' roll's most famous and insistently masculine star – in 1956, five of the nine top singles of the year were by Elvis. At the same time, there would be weeks, even months, when no woman or female group had a hit among the top fifteen records. When women in the fifties did have hits, they were about the moon, weddings, some harmless dreamboat like Annette's "Tall Paul," or maybe about kissing. But they were never, ever about doing the wild thing.

Then, in December 1960, the Shirelles hit number one with "Will You Still Love Me Tomorrow?";it was the first time a girl group, and one composed of four black teenagers, had cracked the number one slot. And these girls were not singing about doggies in the window or old Cape Cod. No, the subject matter here was a little different. They were singing about whether or not to go all the way and wondering whether the boyfriend, so seemingly full of heartfelt, earnest love in the night, would prove to be an opportunistic, manipulative, lying cad after he got his way, or whether he would, indeed, still be filled with love in the morning.

There's more, much more, in Douglas' book, but this particular example of how the music that we listened to, the song-poetry that engraved itself upon our hearts and minds and souls and lifestyles was filled with contradiction and dilemma and heartache and survival. From "It's My Party" to "It's Judy's Turn to Cry." From "Soldier Boy" to "My Boyfriend's Back." From "Bobby's Girl" to the abusive "Johnny Get Angry" and the wistful "Johnny Angel." We had the leader of the pack, a walkin' miracle, a sweet talkin' guy. He's so fine, he's a rebel, he's my guy.

This was the interpersonal minefield we women of the boomer generation had to negotiate, had to reconcile, had to survive.

Back in 2002 when Time magazine chose Coleen Rowley, Sherron Watkins, and Cynthia Cooper – "The Whistleblowers" – as Persons of the Year, I thought it was almost an ironic salute to the girl groups. It was women who had entered the fields once held almost exclusively by men only a generation before them who had opened the eyes of the country to the failures wrought by the opportunistic, manipulative lying cads who had screwed us all. Cooper, who exposed the accounting fraud at WorldCom, was born in 1964, Rowley in 1954, Watkins the youngest was born in 1969. Their stories are worth reading again today. http://www.time.com/time/personoftheyear/2002/

There is a part of me, and sometimes it's a growing part, that believes Hillary Clinton would have done a better job with the presidency than Barack Obama has done. This is not to say he individually didn't have to negotiate the cultural conflicts of race – the chief element that set him apart from other candidates for the presidency – any less than Hillary had to negotiate the conflicts of gender. But she lived through the social turmoil; he did not. She had the cultural experience, he did not.

And so as I watch the crises unfold over health care reform and the wars in Afghanistan and Iraq and Pakistan and Yemen and wherever else its spreading to now, over the economy and the banks and the bonuses, over Haiti and jobs and women's rights and civil rights and gay marriage and abortion, I do indeed wonder.

I wrote a little essay for DU back in 2004 about John Kerry's presidency titled "Why Vietnam Matters." The title was my tribute to Susan J. Douglas' chapter "Why The Shirelles Mattered."

They still do.


Tansy Gold

[Demeter]

71. Ladies and Gentlemen, I Give You Tansy Gold!

Tansy for President!


http://www.youtube.com/watch?v=cbxxkwBQk_o&feature=related

[Tansy_Gold]

103. Live -- 1964

This is a "lasting treasure"

http://www.youtube.com/watch?v=c_cRHw8PAPA&feature=related


Tansy Gold is getting NOTHING DONE TONIGHT (but she's havin' one helluva good time!)

[AnneD]

91. Wonderful things happen .....

when you give girls a voice.......

//www.youtube.com/watch?v=qRiyHeAEUxk.

//www.youtube.com/watch?v=50Jx1ctrFTg&feature=related

It is hard to find pictures of the girls for obvious reasons...

AnneD, happy to play second fiddle to Tansy on the campaign trail.

[AnneD]

101. I am sorry .....

the first clip was suppose to be from the young turks talking about a Saudi girl rock group.

http://www.youtube.com/watch?v=qRiyHeAEUxk&feature=PlayList&p=B21E6955EAC7E595&playnext=1&playnext_from=PL&index=34

[DemReadingDU]

98. Excellent essay, thanks

Yeh, I'm from the same boomer age.
Off to find your Kerry essay.

[Tansy_Gold]

99. I just looked for it and can't find it.

IIRC, someone liked it as a post and asked me to do it as an OP so they could rec it for the greatest page. I think it got enough recs, but I'm not sure.

I do have a draft of it in my personal archives but I don't know how well it matches what might actually have been posted.



TG, who tends to keep everything, including those diaries from 1963, 1964, 1965. . . . . .

[DemReadingDU]

105. Here ya go..."Why Vietnam matters -- long and a bit angry"

Another excellent essay, thanks!

8/24/04 Why Vietnam matters -- long and a bit angry by Tansy_Gold
http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=132&topic_id=664509


WilliamPitt made it a special posting
http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=132&topic_id=665115


BTW, I found it by using the DU Google search box at the top right, next to the yellow logout key. Then I searched for "Why Vietnam Matters", and it popped right up.

[Tansy_Gold]

112. Thanks for finding it!

I used the DU search and came up dry.

Hmm, maybe I'd better add it to my journal too?

Tansy Gold, glad to see she's not theonly one up early on a Sunday morning

[Demeter]

60. Europe cannot afford a Greek default

http://www.ft.com/cms/s/0/cd89c236-0141-11df-8c54-00144feabdc0.html

The eurozone cannot afford to make an example of crisis-hit Greece. Claims by officials and politicians in the currency bloc’s fiscally more robust economies – including Wolfgang Schauble, Germany’s finance minister – that the Greeks will have to find their own way out of the crisis, are not credible. They ignore the fact that Greece’s problems cannot be solved by it alone. Nor would a Greek default be the cleansing experience that many people in the stronger member states appear to imagine.

Eurozone members are rightly furious with the Greek authorities for falsifying budget data. But Greece is just the starkest example of the problems facing economies that have lost competitiveness within the eurozone and now have weak public finances and poor growth prospects. They must cut budget deficits while lowering costs relative to the rest of the eurozone, and this when economies such as Germany and the Netherlands are flirting with deflation and investors are jittery about sovereign risk. On Thursday, Greece announced plans to cut its budget deficit from an estimated 12.7 per cent of gross domestic product in 2009 to just 2.8 per cent in 2012. Given the country’s dire economic prospects, cuts in spending of this order would lead to slump and deflation – crippling for a highly indebted economy – and threaten social stability.

If the eurozone fails to support Greece or makes the terms of any bail-out politically impossible for the country’s authorities to meet, Greece could default on its sovereign debt. The eurozone would then face a big problem. The financial markets would quickly turn their attention to other euro bloc economies with unsustainable fiscal positions and poor growth prospects. Italy, Spain and Portugal would find themselves paying dramatically higher borrowing costs, raising the likelihood of further fiscal crises. Such a scenario would almost certainly deter the European Union’s remaining central and eastern European member states joining the eurozone any time soon. And the political fallout would be huge.

Moreover, if a eurozone member defaults, the risk of it leaving the currency union cannot be completely discounted. If Greece defaulted and remained in the eurozone it would still be deeply uncompetitive. The Greek government would still find it difficult to tap financial markets on affordable terms, because investors would be sceptical about growth prospects. Leaving the eurozone and devaluing would be very high risk but provide a route back to growth, at least short-term, and that could prove a political necessity. A partial unravelling of the eurozone would do the EU incalculable damage.

Of course, Greece, as well as Italy and Spain, have to get serious about boosting productivity and confronting widespread public-sector rent-seeking. But Germany (and other members running big structural current account surpluses) also need to accept they are part of the problem. It makes little sense to argue that weaker member states should try to emulate Germany. A big reason for the relative strength of Germany’s public finances is the size of the country’s trade surplus with the other eurozone economies. But this is hardly something all eurozone states can aspire to: one country’s surplus is another’s deficit.

One disturbing trend of the last few months is that Germany’s surplus with the rest of the eurozone is rebounding rapidly from the crisis, despite extreme economic weakness elsewhere in the bloc. The German economy is recovering on the back of exports; private consumption is actually falling. The weakness of domestic demand will no doubt lead to renewed falls in real wages and to a further decline in Germany’s trade-weighted exchange rate within the eurozone. But it will be all but impossible for the likes of Spain and Greece to put their public finances in order unless they can get their economies growing. For this, they must rebalance their trade with the rest of the eurozone.

The eurozone needs tougher fiscal rules. But it also has to set limits on intra-eurozone current account surpluses and deficits. Fiscal rules will mean little without the latter. The alternative to such rules is a fiscal (hence political) union. This would involve the “stronger” economies transferring money to the “weaker” ones on an ongoing basis, much as happens within individual member states. No one appears to want this, least of all the “strong” countries.

The writer is chief economist at the Centre for European Reform

[Demeter]

62. Could England Be the Next Iceland?

http://www.nakedcapitalism.com/2010/01/could-england-be-the-next-iceland.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Before you dismiss the headline as nutty, at least one respected macroeconomist and former central banker, and now chief economist of Citigroup is of the view that England is at risk of a currency crisis. He noted last November:

With the pound sterling dropping like a stone against most other currencies and credit default swap rates on long-term UK sovereign debt beginning to edge up, this is a good time to revisit a suggestion I made earlier on a number of occasions (e.g. here, here and here SEE ARTICLE FOR LINKS), that there is a non-trivial risk of the UK becoming the next Iceland.

The risk of a triple crisis – a banking crisis, a currency crisis and a sovereign debt default crisis – is always there for countries that are afflicted with the inconsistent quartet identified by Anne Sibert and myself in our work on Iceland: (1) a small country with (2) a large internationally exposed banking sector, (3) a currency that is not a global reserve currency and (4) limited fiscal capacity.

Gillian Tett provides an update on the UK’s indebtedness, and the picture is not pretty. Admittedly, gross debt is not one of Buiter’s signs of trouble, but it often translates into limited fiscal capacity. And England still has a large, internationally exposed banking sector. In fact, that is one reason to think the powers that be may not be bluffing at all when they seek to impose tougher rules on banks, and will accept their departure as a necessary consequence. England cannot afford to have an unconstrained banking sector. It cannot afford another crisis rescue operation. As General Pyrrhus famously said, “One more victory will undo me!”

From the Financial Times (hat tip reader Don B):

Which country experienced the biggest jump in debt, relative to gross domestic product, over the past decade?…if McKinsey consultants are to be believed, the real leverage giant – at least among the big western economies – is actually the UK. After crunching the data, McKinsey estimates that the gross level of British private and public debt is now 449 per cent of GDP – up from 350 per cent at the start of the decade.

And even excluding the liabilities of foreign banks based in the UK, the ratio still runs at 380 per cent – higher than any country except Japan (closely followed by Spain where debt has also spiralled dramatically, according to a McKinsey report issued today.*)

That is sobering stuff, particularly for UK voters. However, it also raises a much bigger point. In the middle of the last decade, it was often frustratingly difficult to get any data on leverage levels, since it was an issue on which precious few policymakers focused…

Now, of course, the world is radically different. But, as McKinsey points out, there is still surprisingly little known about the actual mechanics of “deleveraging”, compared with, say, all that research that has been conducted on financial crises. And so it has tried to plug this gap by both plotting the recent pattern of global leverage levels – and then setting it in a wider historical context, to show how deleveraging has (or has not) occurred before…

Nevertheless, some of the patterns in the report are fascinating – and valuable –precisely because they have often been ignored. Contrary to popular perception, for example, McKinsey points out that, by historical standards, most of the financial world was not crazily leveraged in the past decade. Instead, the crazy debt increase was focused on a small group of brokers, and global banks.

Moreover, alongside the (limited) rise in broker borrowing in the past decade, there was also a far more startling increase in “real economy” debt, particularly in the household and real estate sector.

Yves here. Tett is surprised? She shouldn’t be. Household debt grew rapidly in all countries experiencing housing bubbles. Although mortgage debt was obviously the main culprit, many (like the US, UK, and Australia) also featured impressive levels of unsecured borrowings, usually credit cards. Back to the story.

Since the crisis started, this “real economy” debt has declined a tiny bit, while financial sector leverage has fallen considerably. But since public debt has spiralled, gross leverage levels for most large nations have not fallen. And that, in turn, has a crucial implication: namely that, insofar as deleveraging is inevitable, much of it is still to come. From a historical perspective, this challenge is not entirely unprecedented. The UK and US have, after all, slashed vast debt burdens before during the last two centuries, and McKinsey has identified four dozen smaller deleveraging episodes around the world since 1950.

But while governments have sometimes softened this task before by creating rapid growth, often due to exports (via devaluation), or a peace dividend (after a war), those routes do not look offer an easy escape this time. Growth, in other words, could be tough to achieve. So that leaves three, unpalatable options, McKinsey suggests: outright default, inflation or belt-tightening.

McKinsey’s best guess – or hope – is that belt-tightening will predominate, and it consequently forecasts a grim climate of austerity for the next decade. It may be right. But to my mind, at least, it remains a very open bet whether western voters will accept austerity without a backlash; personally, I would thus put a higher emphasis on the other options too.

Either way, the real moral is that the task now facing the western governments is monumental. It is a pity that groups such as McKinsey were not producing these leverage charts three years ago. If so, the politicians might now not be in quite such a pickle, even – or especially – in the UK.

Yves here. I cannot imagine McKinsey doing this sort of work three years ago. McKinsey is in the business of dispensing what I have long called leading edge conventional wisdom. Nothing so far ahead of the curve as to be threatening.

[Demeter]

65. Bernanke Gets Desperate (Fed Letter)

http://dailybail.com/home/bernanke-gets-desperate-fed-letter.html

Bernanke gets desperate, pens letter to Dodd & Shelby acknowledging 'shortcomings in oversight', while begging for a continued seat at the regulatory table.

This gem slipped under the radar yesterday, but that shouldn't diminish its significance to Fed watchers. Bernanke is definitely getting nervous. The WSJ called the letter a 'rare move' by a sitting Fed Chairman.

COMPLETE TEXT (PDF) AT: http://online.wsj.com/public/resources/documents/fedletter011410.pdf

VOLKERS COMPLETE SPEECH AT: http://blogs.wsj.com/economics/2010/01/14/volcker-fed-must-retain-bank-supervisor-role/


CUE THE SUPREMES! http://www.youtube.com/watch?v=10n3qMMDlrk&feature=related

[Demeter]

66. SOURCE BLOG

http://dailybail.com/home/bernanke-gets-desperate-fed-letter.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed:+TheDailyBail+%28The+Daily+Bail%29

[Demeter]

67. Larry Summers, Robert Rubin: Will The Harvard Shadow Elite Bankrupt The University And The Country?

http://www.huffingtonpost.com/harry-r-lewis/larry-summers-robert-rubi_b_419224.html

Harvard's Secret Seven

At the heart of the new system of power, says Janine Wedel, is "a decline in loyalty to institutions" and "the proliferation of players who swoop in and out of organizations with which they are affiliated." There is no more vivid example of this phenomenon than Harvard University, which for centuries was held together by institutional loyalty. Today, that loyalty has eroded, and those at the top act much more flexibly. Yet they still enjoy almost unlimited power. Like all forms of mismanagement, Harvard's woes call for transparency and accountability. The story resonates to Washington, where Harvard's power elite is deeply entangled.

Harvard lost $11 billion from its endowment last year, plus another $2 billion by gambling with operating cash and $1 billion in bad bets on interest rate fluctuations. Harvard had been borrowing vast sums to leverage its assets and to expand its physical plant; its president, Lawrence Summers, had described as "extraordinary investments" what ordinary people would call crushing debt. The only way to balance the looming deficits was through huge investment returns. The speculating worked for a while, but when the bubble burst, Harvard was left almost insolvent.

A presidential resignation might have been expected, but Summers, the president most responsible for Harvard's unsustainable growth plan, had resigned already--he is now a top economic adviser to Barack Obama. In any case, plenty of costly mistakes were made after he left. In this era of heightened corporate accountability, one might have expected instead a shake-up of Harvard's board. But Harvard's directors are invulnerable.

Legally, the Harvard Corporation consists of the president and six "Fellows," who serve for life if they wish and cannot be unseated by anyone except themselves. In spite of the privileges it receives as a tax exempt charity, Harvard is not subject to the financial and risk disclosure rules that protect the shareholders of public corporations.

The Corporation is stunningly secretive. The members are listed on a Harvard web page--but with no contact information. Their meetings and agendas are unannounced, their decisions unreported. The Fellows, scattered across the country, are isolated from the institution they govern. Even the university's statutes--the closest thing to a constitution limiting the Corporation's discretionary power--are almost impossible to locate. The colonial-era board structure is failing the modern university.

Harvard's board is intertwined with the shadow elite of Wedel's Chapter 5: the team of experts who disastrously advised the Russian government on capitalism in the 1990s. Engaged by the U.S. to show the Russians how the West controls corruption, the advisers became models of what to avoid. Here is the Cambridge-Moscow-Washington story in a nutshell.

In 1991, Lawrence Summers became chief economist of the World Bank, moving to the Treasury Department in 1993. When Robert Rubin became Treasury Secretary in 1995, Summers became his Deputy Secretary, later succeeding him as Secretary.

In 1992, Andrei Shleifer, a Harvard professor and a close friend of Summers since Shleifer's college days at Harvard, became head of a Harvard project that directed U.S. government money for the development of the Russian economy. Tens of millions of dollars in noncompetitive U.S. contracts flowed to Harvard for Shleifer's Russian work, and his team directed the distribution of hundreds of millions more. Through the mid-1990s, complaints accumulated in Washington about self-dealing and improper investing by the Harvard team, and by mid-1997, the Harvard contracts had been canceled and the FBI had taken up the case. For two years it was before a federal grand jury.

In September, 2000, the government sued Harvard, Shleifer, and others, claiming that Shleifer was lining his own pockets and those of his wife, hedge fund manager Nancy Zimmerman--formerly a vice president at Goldman Sachs under Rubin.

Soon after, when Summers became a candidate for the Harvard presidency, Shleifer lobbied hard for him in Cambridge. Rubin assured the Fellows that the abrasiveness Summers had exhibited at Treasury was a thing of the past. They named him president--in spite of what was already known about his enabling role in the malodorous Russian affair, and the implausibility of a personality metamorphosis.

Summers did not recuse himself from the lawsuit until more than three months after his selection as president, and even then used his influence to protect Shleifer. The Fellows--including Rubin, whom Summers added to the Corporation--fought the case for years, spending upwards of $10M on lawyers. But in 2005 a federal judge found Shleifer to have conspired to defraud the government and held Harvard liable as well. To settle the civil claims, Shleifer paid the government $2M and Harvard paid $26.5M; Zimmerman's company had already paid $1.5M. Shleifer denied all wrongdoing, and Harvard disclosed nothing about any response of its own--a departure from its handling of misconduct by faculty farther from the center of power.

Summers remained close to Shleifer, yet claimed in a February 2006 faculty meeting to know too little about the scandal to have formed an opinion about it. This prevarication brought a gasp from the assembled faculty and solidified faculty opposition to the Summers presidency.

Rubin is now gone from his leadership role and his board membership at Citigroup, hauling away $126M from a firm that was $65B poorer than when he joined it, with 75,000 fewer jobs. But he remains on the Harvard board, in spite of the financial meltdowns at both Citigroup and Harvard and his poor oversight of the problematic president he persuaded Harvard to hire.

The Rubin network remains alive and well in the White House, including not just Summers but several other Rubin protégés. Among the strangest of these power loops is that the well-connected Nancy Zimmerman has turned up as a member of Summers's economic policy brain trust.

The modern power elites thrive by forgetting any regrettable past. This amnesia is easy at Harvard, where the legal fiduciaries operate in secret and need not answer for their acts. They are the antipodes of the selfless institutional servants who built Harvard and other great American enterprises, and they bear close watching.

[Demeter]

70. There Will Be Days Like This

http://www.youtube.com/watch?v=ns1exm8Y5r4&feature=related

[Demeter]

75. If Government Won’t Break Up the Giant Banks, Let’s Do It Ourselves

http://www.nakedcapitalism.com/2010/01/guest-post-if-government-wont-break-up-the-giant-banks-lets-do-it-ourselves.html

A primer on moving your money.

[Demeter]

76. WSJ Runs Dubious Argument for Keeping Citi Intact

http://www.nakedcapitalism.com/2010/01/wsj-runs-dubious-argument-for-keeping-citi-intact.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Otis Otih, the treasurer of candy maker Mars Inc., uses GTS to handle most payments to employees and vendors of Mars operations in 68 countries. “Citibank is the only truly, truly global company for us — I don’t see any alternative,” he says.

As an example of what the unit allows multinationals to do, an Asian subsidiary of a European company can deposit funds with Citigroup locally and the money will instantly show up on the ledger of the parent a continent away. The system makes it easier for corporate treasurers to manage their finances, and many corporate and government clients outsource a wide range of other finance work to GTS….

Executives told officials with the Treasury Department and the Fed that GTS’s technology and presence in more than 100 countries made it too dangerous for the U.S. to let Citigroup collapse. The Treasury gave the bank a second big helping of $20 billion just six weeks after an initial $25 billion infusion from the Troubled Asset Relief Program, partly in recognition of GTS’s importance to the financial system, according to government and company officials….

While Citigroup is primarily known for its retail banking and credit-card businesses, the GTS unit is increasingly integral to the parent company’s functioning. Clients that move funds through GTS leave a lot of cash on deposit at the unit, which funnels the money to other parts of Citigroup for lending or other uses. GTS’s deposit-gathering muscle has grown more important since the financial crisis began, now providing about 40% of Citigroup’s $800 billion of deposits.

Yves here. GTS is a big piece of what makes Citi a difficult to disarm bomb. One of the swords of Damocles that the big bank had over the officialdom is that, prior to the crisis, it had $500 billion of uninsured foreign deposits. If Citi looked wobbly, sensible depositors would withdraw funds, and that could quickly morph into a run. Moreover, then any other international bank with meaningful cross border deposits could come under scrutiny (although it is odd more of this has not happened in the wake of the implosion of Iceland, which left a number of UK borrowers high and dry until concerted pressure on Iceland produced some restitution).

The Journal argues that GTS is essential to Citi. This is rubbish. GTS is a sophisticated payments system and a source of low-cost deposits. It may provide a foot in the door, and help deepen some relationships, but let us face it, cash management and payments systems are at best assistant treasurer relationships at big companies. Proof of the pudding: it is a no-brainer that companies like Goldman, Morgan Stanley, Barclays, and UBS are doing complex, high margin transactions at companies that are also using GTS.

We cannot afford to have critical, socially valuable, core banking services be used to fund high-risk activities that then put the provision of the core services at risk. So we have two choices. One option is to regulate the banks so as to severely restrict their risk-taking (which is possible but no one has the will to do it right now), and various bank activities would be defined so that it you engaged in them, you’d be required to be licensed and subject to the same rules. The other route is to make the TBTF bank less big and complex, so that resolving one would not be impossible. I’m skeptical of that approach, because the capital markets firms are still deeply enmeshed, so one going down runs the risk of taking down the entire grid.

But whichever way you come out on this question, Citi is too bloody big and complicated. Even though Citigroup is already in the process of scaling itself back to something resembling the old Citibank, even that is still a dangerously large operation. And now with Citi carrying a very large portion of its assets in Treasuries and liquid securities, it actually could afford to spin off GTS, since the bank is not funding as many illiquid positions as it once did (admittedly it would be operationally complicated, and Citi might need an transitional funding arrangement with GTS, but remember, we split up AT&T). That would have the salutary effect of improving the equity ratios of the rest of the bank (the money raised by the IPO would likely exceed, by a large margin, the value at which the unit is carried on Citi’s balance sheet now), and of eliminating the use of cheap foreign deposits to fund riskier activities which then are backstopped by the US taxpayer.

But as long as we have outlets like the Journal running scare stories on why we have to leave banks be, it’s unlikely we’ll see anyone in the officialdom explore radical enough actions to actually make a difference.

[Demeter]

77. “Why Bernanke’s Defense of Super Low Interest Rates Does Not Hold Up”

http://www.nakedcapitalism.com/2010/01/why-bernankes-defense-of-super-low-interest-rates-does-not-hold-up.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

By Richard Alford, a former economist at the New York Fed. Since then, he has worked in the financial industry as a trading floor economist and strategist on both the sell side and the buy side....

EVER SINCE GREENSPAN PULLED THE RUG OUT FROM UNDER SAVERS (ALMOST IMMEDIATELY AFTER HIS APPOINTMENT) IT HASN'T PAID TO SAVE: .1% INTEREST? PLEASE!

[Demeter]

80. ANOTHER MEDLEY

http://www.youtube.com/watch?v=VPpd-6X3tEo&feature=related

[hamerfan]

82. Big Yellow Taxi!

The classic:

http://www.youtube.com/watch?v=ZgMEPk6fvpg

[AnneD]

92. I think this might be a better theme....

it was by a girls group Cookies, but the Beatles covered it.

//www.youtube.com/watch?v=BIVNrBrsEpI

an example of the group

/www.youtube.com/watch?v=7PV3PNQxLBQ&feature=related


and their thunder co-opted by a white group...

//www.youtube.com/watch?v=zUD4sfNqLF8



Was it just a coinkie dink that they preceeded the civil rights movement????? I think not.

[Demeter]

84. Well, I've Got to Go Be Useful

I'll be back Sunday and Monday--in a new thread, since this one's been growing like Topsy---which gives you all a chance to catch up.

I've been posting in categories wherever possible, so starting from the top and running through it all is the only way to be sure you've seen everything, but you've got all Saturday to catch up.

Whew! There is too much stuff going on!

I'm down to 110 emails. At this rate, I will never catch up unless things start to get resolved and the buildup becomes irrelevant (it could happen, I'm just not going to hold my breath). So, rather like Sisyphus, I will return Sunday after lunch...be good, stay warm and post!

[DemReadingDU]

85. All Alone Am I

Brenda Lee 1962
http://www.youtube.com/watch?v=wnApJcGBDFY

[Dr.Phool]

97. Denninger: Alt-A's getting set to explode.

More of those green shoot thingies.
-----------------------------------


I have often commented that we're nowhere near done with the mortgage explosions, and that where subprime was bad, those loans made in 2005-2007 to people who lied about their incomes - which is 90% of those who took out "ALT-A" loans - were going to be a catastrophe.

Well, as Kirk said, "here it comes"

Moody's Investors Service put $572.7 billion in Alternative-A residential mortgage-backed securities issued from 2005 through 2007 on watch for possible downgrade after it revised its loss provisions.

The rating agency said Alt-A loans that are 60 or more days delinquent "have increased markedly" since it last revised its loss projections. Alt-A mortgages, which sit between prime and subprime, typically were granted without the borrower showing proof of income or assets.

That's a cool half-a-trillion worth.

And guess what this means for loss rates?

Moody's said it now projects, on average, cumulative losses of 14% of the original balance for 2005 securitizations, 29% for 2006 securitizations and 35% for 2007 securitizations. The updated loss projections will have the greatest impact on senior securities issued in 2005, the firm said.

That ought to leave a mark.

No, the banks have not taken write-downs of some 27-30%ish on these securities in aggregate (that's another $150-170 billion worth), nor has anyone else.

One wonders when our government will recognize that a loan made to someone who claims to have $200,000 in income but really makes $50,000 simply cannot be refinanced into anything the borrower can afford nor is there any way to prevent that loan from defaulting. This is the ultimate fraud and outrage in "extend and pretend" and "mark to fantasy" - there is no possible way for these loans to be "made good" no matter what happens in the future - they were always going to blow up unless house prices continued to rise forever, thereby allowing the "borrower" to roll them over time and time again.

Those who believe we can "make it all ok" are delusional beyond words.

http://online.wsj.com/article/BT-CO-20100114-714751.html?mod=WSJ_latestheadlines

[Tansy_Gold]

100. And you've just had some kind of mushroom. . . . .

http://www.youtube.com/watch?v=WANNqr-vcx0&feature=related

[DemReadingDU]

108. Tribute - 60's Girl Groups

This is a video to 4 girl groups ( U probably will have to adjust the volume a few times)

Please Mr. Postman
Chapel of Love
Give Him A Great Big Kiss
Let Me go The Right Way

http://www.youtube.com/watch?v=KgCGeZLpusw&NR=1&feature=fvwp

[DemReadingDU]

109. A Salute to The Girl Groups Of The 60's

A few of the Girl Groups of The 6-'s like the Shangri-las, Crystals, Ronettes and Martha & The Vandellas.

http://www.youtube.com/watch?v=CWO_fO6YUz8

[DemReadingDU]

110. Ronettes

Be My Baby
http://www.youtube.com/watch?v=MCUO7F2xjzw

Sleigh Ride
http://www.youtube.com/watch?v=Xa-hTXE72G0


What a great trip down Memory Lane. Thanks for all the classic girl groups from the 60s!

[Demeter]

111. The Weekend Continues!

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=103x510832