Gravy Train

clipped from www.businessweek.com Monday afternoon, Goldman Sachs (GS) reported much larger than expected first-quarter profits on the heels of the strong earnings Wells Fargo (WFC) reported last week. No one should be surprised. The Federal Reserve has provided the banks with lots of cheap funds through various emergency lending facilities and quantitative easing. The Fed has permitted the banks and financial houses to park vast sums of unmarketable paper on its books—securities made nearly worthless by the misjudgment and avarice of bankers. In return, the Fed has provided these paragons of finance with fresh, cheap funds to lend at healthy rates on credit cards, auto loans, and even mortgages. It takes good banking skills to borrow at 3%, lend at 5%, and make a profit. It takes much less business acumen to borrow at 2%, lend at 5%, and make a profit—which is exactly what has happened. The extra fees are just gravy. This all comes at a cost to someone—America's elderly.

Not So Cut And Dried

clipped from www.theonion.com WASHINGTON—More than a week after President Barack Obama's cold-blooded killing of a local couple, members of the American news media admitted Tuesday that they were still trying to find the best angle for covering the gruesome crime. "I know there's a story in there somewhere," said Newsweek editor Jon Meacham, referring to Obama's home invasion and execution-style slaying of Jeff and Sue Finowicz on Apr. 8. "Right now though, it's probably best to just sit back and wait for more information to come in. After all, the only thing we know for sure is that our president senselessly murdered two unsuspecting Americans without emotion or hesitation." Added Meacham, "It's not so cut and dried." So far, the president's double-homicide has not been covered by any major news outlets. The only two mentions of the heinous tragedy have been a 100-word blurb on the Associated Press wire and an obituary on page E7 of this week's edition of the Lake County Examiner.

Chart Of The Year

clipped from www.crossingwallstreet.com Here are the daily changes of the S&P Banking Index:

Seven Little Problems

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Haters Update

clipped from www.transterrestrial.com Can you imagine the howls of outrage from all of the nation’s editorial pages, and the heads exploding on MSNBC, if the Bush administration DHS had put out a document that said things like this? (U) Leftwing extremism in the United States can be broadly divided into those groups, movements, and adherents that are primarily hate-oriented (based on hatred of particular economic classes, and religious groups, particularly Christianity), and those that are mainly pro-government, preferring federal authority and particularly federal judicial rulings over state or local authority. It may include groups and individuals that are dedicated to a single issue, such as opposition to restrictions on abortion, immigration, or gay marriage.

The Age Of Golden Transparency

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The Ducking Pantywaist

clipped from blogs.telegraph.co.uk President Barack Obama has recently completed the most successful foreign policy tour since Napoleon's retreat from Moscow. Barack is not the first New World ingenue to discover that European leaders will load him with praise, struggle sycophantically to be photographed with him and outdo him in Utopian rhetoric. But when it comes to the critical moment of opening their wallets - suddenly it is flag-day in Aberdeen. Okay, put the G20 down to inexperience, beginner's nerves, what you will. So The One retired triumphant, having secured a massive contribution of 5,000 extra troops - all of them non-combatant, of course President Pantywaist is hopping mad and he has a strategy to cut Kim down to size: he is going to slice $1.4bn off America's missile defence programme, presumably on the calculation that Kim would feel it unsporting to hit a sitting duck, so that will spoil his fun.

Our Nazi Overlords, Monday Edition

clipped from michellemalkin.com Yesterday, Roger Hedgecock and the Liberty Papers posted an unclassified DHS Office of Intelligence and Analysis report titled: Rightwing Extremism: Current Economic and Political Climate Fueling Resurgence in Radicalization and Recruitment. The “report” was one of the most embarrassingly shoddy pieces of propaganda I’d ever read out of DHS. I couldn’t believe it was real. I spent the day chasing down DHS spokespeople, who have been tied up preparing for a very important homeland security event later today: The First Lady is coming to visit their Washington office. Priorities, you know. Well, the press office got back to me and verified that the document is indeed for real.

Dodd Economy Suffocating

clipped from pajamasmedia.com JONATHAN MACEY: “To socialize the American economy, it is not necessary to nationalize every business in the United States. All it requires is to put the corporations that control the finances of all of the companies in the economy under government control. And that is what is happening now. . . . Apparently, members of Congress liked the special treatment that Connecticut Sen. Chris Dodd received in getting his mortgage through Countrywide. We’re going to see even more of that kind of thing — and outright corruption on a much bigger scale — when the government is in direct control of the financial institutions and making the credit decisions that businesses large and small depend on to survive.”

OGlossy

clipped from www.realclearpolitics.com What Obama proposes is a "post-material economy." He would de-emphasize the production of ever-more private goods and services, harnessing the economy to achieve broad social goals. In the process, he sets aside the standard logic of economic progress. Since the dawn of the Industrial Age, this has been simple: produce more with less. ("Productivity," in economic jargon.) Mass markets developed for clothes, cars, computers and much more because declining costs expanded production. Living standards rose. By contrast, the logic of the "post-material economy" is just the opposite: spend more and get less. Some may accept higher taxes if they think they're improving the health or education of the poor. Unfortunately, these psychic benefits may be based on fantasies. What if U.S. cuts in greenhouse gases are offset by Chinese increases? What if more health insurance produces only modest gains in people's health? Obama and his allies have glossed over these questions.

Bubble Economics

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The Pretense Of Knowledge And The Recipe For The Next Great Depression

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Takings

clipped from www.realclearpolitics.com WASHINGTON -- Rampant redistribution of wealth by government is now the norm. So is this: It inflames government's natural rapaciousness and subverts the rule of law. This degeneration of governance is illustrated by the Illinois Legislature's transfer of income from some disfavored riverboat casinos to racetracks. Illinois has nine licensed riverboat casinos and five horse-racing tracks. In 2006, supposedly to "address the negative impact that riverboat gaming has had" on Illinois horse racing, the Legislature -- racing interests made huge contributions to Gov. Rod Blagojevich -- mandated a transfer of 3 percent of the gross receipts of the four most profitable casinos, those in the Chicago area, to the state's horse-racing tracks. What is to prevent legislators from taking revenues from Wal-Mart and giving them to local retailers? Or from chain drugstores to local pharmacies? Not the tattered remnant of the Constitution's takings clause.

"Reform"

clipped from pajamasmedia.com As someone who left a major Wall Street IB (First Boston) to start a private boutique, I believe you will see a larger exodus towards that model rather than for other large investment banks. Small, privately-owned advisory firms that can earn large fees with little capital and far less oversight. We became a major force in M&A and public equity underwritings in our sector with only $8 MM in capital (we sold out to Merrill Lynch in 2006). We’re going back to the 1920s and the era of partnerships and private capital. Pubic capital markets are over-regulated now and it will get worse. Restricting access to capital is bad for growth, but good for those who are already wealthy because they will get their pick of the best opportunities and earn higher returns. A lot of “reform” seems to be mostly good for those who are already wealthy.

Punked

clipped from legalinsurrection.blogspot.com Now comes "The Detainee Episode." No, not Brooks again. He learned his lesson. Liberal bloggers and columnists who are wringing their hands dry over Obama's continuation of George Bush's policies with regard to enemy combatants (now "detainee who lent substantial support to al-Qaeda") and other aspects of the war on terror (now "overseas contingency operation") such as electronic eavesdropping. The Rhetorican: "[T]o put it in terms a Kos Kid can understand: it sure is creepy how it seems that the much-feared Dick Cheney/Karl Rove shadow government remains in power with Obama as their new puppet, doesn’t it?" So Barack Obama is just another politician who said one thing to get elected, then preserved his power once in office. When it comes to detaining bad guys without access to court, he said he would close Gitmo, he didn't say he would close Baghram. His words were just words, and you weren't listening carefully enough. You've been punked again.

The Second Time As A Farce

clipped from gatewaypundit.blogspot.com This is like watching Bill Clinton all over again. It looks like we will have to lose another 3,000 or more Americans in a single day before the Team Obama will act. If they ever do act. The Washington Post reported, via The Jawa Report: Senior Obama administration officials are debating how to address a potential terrorist threat to U.S. interests from a Somali extremist group, with some in the military advocating strikes against its training camps. But many officials maintain that uncertainty about the intentions of the al-Shabab organization dictates a more patient, nonmilitary approach. Damning CIA drone video footage from 1998 of Osama bin Laden aired on NBC News in March, 2004. In the video Osama is surrounded by his men at a terrorist compound in Afghanistan. The Clinton Administration took no action at the time despite the numerous attacks by Osama bin Laden on the United States prior to this video.

Including The Tail

clipped from pajamasmedia.com Robert Kaplan describes the logic for negotiating with the Taliban in order to “make progress and find an exit strategy” in Afghanistan. But halfway through the article the reader will come to the realization that Kaplan isn’t talking about the War in Afghanistan at all, but about something much larger: Pakistan, India, Pashtunistan, the Great Game. The discussion is about the Taliban only in the sense that when you talk about a dog, it necessarily includes the tail. Kaplan places the origins of the Taliban in Islamabad — and the region.

The Laboratory

clipped from www.mises.org There was once such a thing as the human sciences of which economics was part. The goal was to discover and elucidate the exact laws that govern the interaction of people with the material world. It had its own methods and own recommendations. Then something changed. Science became entirely positivistic in its orientation. Economics was changed from a human science into a poor cousin of the natural sciences that applied positivist methods, and to no great end, for human beings do not move about like molecules but rather engage in choices and unpredictable actions. What Hayek does in this treatise is link the change in methodology to a change in politics. The economy and people began to be regarded as a collective entity to be examined as if whole societies should be studied as we study planets or other non-volitional beings. It then began to make mistakes, treating facts as theories and theories as contingent. And thus is the state invited in to treat society as a laboratory.

Why You've Never Heard Of The Great Depression Of 1920

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This is a must see.

Lawyers Running Everything

clipped from www.powerlineblog.com The FBI is preparing criminal charges against the Somalian pirates. This is reassuring too: "[O]ur Justice Department has said that it would favorably consider prosecuting such apprehended pirates." That's kind of them. Of course, there is ample precedent for such criminal prosecutions. When Jefferson dispatched the Navy to the Mediterranean to stop Muslim pirates from enslaving Americans and others, he told them to make sure to bring the pirates back alive so they could stand trial. And above all, he instructed the Navy not to step foot on the Shores of Tripoli without a search warrant. This is what happens, I suppose, when you have lawyers running everything. National defense becomes just another type of litigation. Let's hope this isn't a harbinger of the Obama administration's approach to the problem of piracy.

Parallels

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The Ice Age Cometh

clipped from wattsupwiththat.com Fig 5 also shows that the whole debate about MWP is irrelevant. Imagine there was no MWP. Practically ALL of the Holocene period the eath appears to be between 0,5 and 1,5 K warmer than today. The little ice age does resemble a mini ice age or at least it appears to be the coldest period in over 10.000 years. Finally, the overall picture from the graph is an almost perfect mathematical curve that tops around 5-6000 years ago. These Data tells the story quite clear: We are on a down trend in temperatures globally, we should not fear warmth by now. How much lower can the temperatures on earth go before we reach a tipping point to much colder temperatures at earth?

That Habeas Thing

clipped from www.qando.net Earlier in the week I pointed out that the Obama administration was defending their assumed right to continue the wiretaps they so roundly condemned when the Bush administration did them. And, of course, we all remember the consistent condemnation by candidate Obama of Guantanamo Bay and the denial of habeas to prisoners there as a horrible denial of rights. Of course that was then and this is now, and it appears what was considered a principled stand now appears nothing more than election year rhetoric. The Obama administration said Friday that it would appeal a district court ruling that granted some military prisoners in Afghanistan the right to file lawsuits seeking their release. The decision signaled that the administration was not backing down in its effort to maintain the power to imprison terrorism suspects for extended periods without judicial oversight. But that was a mortal sin when BushHitler was in charge, wasn’t it?

CEObama's Freaking Jet Pies

clipped from ace.mu.nu When you're the president of the United States, only the best pizza will do - even if that means flying a chef 860 miles. Chris Sommers, 33, jetted into Washington from St Louis, Missouri, on Thursday with a suitcase of dough, cheese and pans to to prepare food for the Obamas and their staff. He had apparently been handpicked after the President had tasted his pizzas on the campaign trail last autumn. Hey, you guys know what says you are really sincere about this whole Global Warming thing that you want to use to justify an economy crushing cap and trade program? Jetting a dude across the country to make you a freaking pie. And you know what says you have a real solid handle on the economic concerns of citizens who are struggling through the recession? Jetting a dude across the country to "hand toss your dough".

Redux: Investment And Denunciation

clipped from www.sodahead.com If you were a rising young executive with a promising future, would you be more likely or less likely to go to work for a company where politicians can fire you? We have become such suckers for words that politicians can spend our tax money like a drunken sailor, provided they call it "investment." At least the drunken sailor is spending his own money but people look down on him because he doesn't call it "investment." Socialists believe in government ownership of the means of production. Fascists believed in government control of privately owned businesses, which is much more the style of this government. That way, politicians can intervene whenever they feel like it and then, when their interventions turn out badly, summon executives from the private sector before Congress and denounce them on nationwide television.

Did I forget to mention that Thomas Sowell is one of the few people actually qualified to be President. And smart enough not to be of course.

Without A Trace

clipped from www.redstate.com The author goes on to complain about FISA, and the way that the current administration is apparently arguing for much broader definitions than the last one ever did over what the government can and can’t be held liable for when it comes to surveillance. This is done without a trace of visible irony, or with any indication that we - not to mention Glenn Greenwald, who this guy is apparently holding up as an example of moral rectitude* - knew all along that the President wasn’t going to be the anti-FISA warrior of the Left’s dreams. We weren’t exactly shy about saying so at the time, either. A bit odd, don’t you think?

Of Course

clipped from pajamasmedia.com CONNECTIONS BETWEEN the Stevens case and the Libby case? “So, it was with great interest that I read that the Department of Justice attorney, Brenda Morris, already held in contempt by Judge Sullivan in the matter involving the wrongful prosecution of Senator Ted Stevens, and now under investigation by both the Department of Justice and the special prosecutor chosen by the Judge, was also a supervisor in the Libby case.”

"Democracy"

clipped from pajamasmedia.com CHICAGO TRIBUNE: Under tyranny of everyday hypocrisy. The fatal flaw in former Gov. Rod Blagojevich’s alleged schemes of pay-to-play politics could come down to the quid being too close to the quo. •Gov. Ed Rendell of Pennsylvania unilaterally awarded a lucrative no-bid contingency fee contract to the Houston law firm of Bailey, Perrin & Bailey, which had contributed more than $90,000 to the governor’s 2006 re-election bid. •Michelle Obama was employed by the University of Chicago Medical Center. Her husband, as a U. S. senator, requested a $1 million earmark for the center. The gazillion dollars spent on earmarks for bridges back home are rife with quid separating quo just long enough to appear as constituent democracy in action. When Dodd, organized labor, Rendell, Obama and Congress do it, it’s called “democracy,” or “lobbying” or “free speech.” When Blagojevich does it, with the quid too close to the quo, it’s called “a crime.” Read the whole thing.

Pessimism Update

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Where Are The Apoplectics Now?

clipped from pajamasmedia.com Civilian libertarians were apoplectic over former President George W. Bush’s “warrantless wiretap” program, which sought to monitor communications from terrorist networks overseas. So why are they not screaming bloody murder now that President Barack Obama appears slated to receive unprecedented power to monitor all Internet traffic without a warrant and to even shut the system down completely on the pretext of national security? The Cybersecurity Act of 2009 - introduced by Senate Intelligence Committee chairman Jay Rockefeller, D-WV, and cosponsor Olympia Snowe, R-ME - bypasses all existing privacy laws and allows White House political operatives to tap into any online communication without a warrant, including banking, medical, and business records and personal e-mail conversations. This amounts to warrantless wiretaps on steroids, directed at U.S. citizens instead of foreign terrorists. Well, if it’s not aimed at terrorists, I guess it’s okay.

COTD: Jumper Cables

clipped from neoneocon.com This post reminds me how my father tried in vain to convince me not to buy the $400 car that came with jumper cables….And i tried in vain to convince my teenage son not to buy the $800 car that came with jumper cables. My money is on my grandson continuing this great tradition one day.

Santayana And Shaw

clipped from neoneocon.com Poor Santayana. Didn’t have a clue. Whether you remember the past or not, you will relive it, because some other SOB doesn’t. George Santayana—for those of you who know your history—was the philosopher who declared, “Those who cannot remember the past are condemned to repeat it.” (And by the way, according to Wiki, Santayana had a mother named Josefina Borrás, “better known as Jo Bo”—could this be someone having a little fun with history and Wiki at our expense?) In public matters, it’s the aggregate of the population—and/or the leaders—who must remember the past in order to prevent a recurrence. For the individual who remembers and even foresees but is relatively powerless, all he or she can do is protest, endure, emigrate, or in extreme cases try to stage a revolt. Perhaps that’s why George Bernard Shaw was able to offer another pithy observation about history: “We learn from history that we learn nothing from history.”

Gramsci's Wages

clipped from www.rasmussenreports.com Only 53% of American adults believe capitalism is better than socialism. The latest Rasmussen Reports national telephone survey found that 20% disagree and say socialism is better. Twenty-seven percent (27%) are not sure which is better. Adults under 30 are essentially evenly divided: 37% prefer capitalism, 33% socialism, and 30% are undecided. Thirty-somethings are a bit more supportive of the free-enterprise approach with 49% for capitalism and 26% for socialism. Adults over 40 strongly favor capitalism, and just 13% of those older Americans believe socialism is better.

Contempt

clipped from www.davidwarrenonline.com But deeper still, he found the European hypocrisy a greater obstacle even to its self-understanding than the American resentment of it. For here was an entire continent that had become, through terrible wars, morally confused and dysfunctional, even while it contained great numbers of vigorous, able and, indeed, very civilized people. Hutchison said things were getting worse, and might require a miracle to reverse; but that the cure "will not be found in the present attempt to hush up the unpleasant truth by diplomatic postures, after-dinner oratory and transatlantic cargoes of soft soap." These remain the cures proposed, and on view once again this last week at the G20 summit. The current popularity of President Barack Obama in Europe is another mask: Europeans adore him because they think he shares their "sophisticated" contempt for the American people.

Think Again

clipped from mises.org For those thinking that the real-estate bust is all over with — think again. The residential market has hit the ditch and continues to sink lower, but now the commercial property market is rolling over and will take many lenders down the drain with it. America's small and regional bankers are pointing their fingers at the big banks, claiming the big money center banks "have tarred and feathered us," City National Bank chief executive Bill McQuillan told the Wall Street Journal during the Independent Community Bankers of America convention in Phoenix. But banks — large and small — all over the country are loaded with commercial real-estate loans, and that collateral is heading south according to a Deutsche Bank report. Despite being inexperienced and clueless, at least bank workout officers understand what's going on, according to Miller, however the rose-colored-glasses-wearing bank senior managements are counting on real-estate values to turn around by year's end.

Foreseeable

clipped from www.powerlineblog.com Head of the Presidential Strategic Studies Center Ali Reza Zaker Isfahani said on Wednesday that enemies of Iran have given in to the Islamic Republic and accepted the country's nuclear realities. "Fortunately, revolutionary steps of the Iranian people pave the ground for the enemies' failure as well as acceptance of Iran's nuclear realities," Zaker Isfahani stated. He underlined that Iranian President Mahmoud Ahmadinejad's government could break the dominating international order by following the Late Imam Khomeini's path, adding, "This has led to the acceptance of Iran's nuclear energy right by the new US president, Barack Obama." Meantime, Iranian President Mahmoud Ahmadinejad announced on Wednesday that his country views the nuclear issue as a "closed case". I'm not sure whether Iran's interpretation of Obama's submissive attitude is correct, but I am quite certain that it was foreseeable.

Did I Forget To Mention Love?

clipped from pajamasmedia.com As he points out in a wonderfully compact paragraph, the greatest novels about modern tyranny “all powerfully depict totalitarian society’s assault on…personal love.”  But as Huxley, Orwell and Zamyatin all remind us, total tyranny is impossible; subversion invariably sets in.  The compulsion to extinguish spontaneous love, as Jamie tells us, is the point of intersection between the ideologies of the Left and the jihadis.  Some of the most fascinating pages of United in Hate spell out the details.  Jamie reminds us of things we failed to appreciate at the time, as for example the details of the will of the leading 9/11 terrorist, Mohammed Atta.  No women were to be present at his funeral, and were to be banned from ever visiting his grave.  Moreover, his shame about his own body was spelled out: “He who washes my body around my genitals should wear gloves so that I am not touched there.”

It Ain't Your Money To Spend

Is found here.

Who Is John Galt?

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OTimeline

clipped from drsanity.blogspot.com April 3 - North Korea Launches Rocket to test missile system but pretends it is a satellite launch April 5 - Obama says North Korea should avoid more provacative actions April 5 - Ambassador Susan Rice says the US will work with UN for "appropriate" response April 5 - UN Security Council Adjourns without response to North Korea April 5 - North Korea warns that any UN censure will result in severe consequences April 6 - China says UN should be "prudent" in dealing with North Korea April 6 - Krauthammer calls UN response "a farce" April 7 - Obama and Gates Gut the Military April 7 - Forget North Korea, Obama team readies for confrontation with...Israel (Israel, for the uninformed and the anti-semitic left , is a US ally) April 8 - ????

Guess Who Loses?

clipped from www.realclearmarkets.com Game theory tells us that a risk neutral gambler would pay $50 dollars for a coin flip that paid $0 for Heads and $100 for Tails. Game theorists would call $50 the value of the bet. Suppose someone is willing to fund your gambling problem, and lend you $80 at zero interest. Better still, if you lose the bet you don’t have to pay him back. Under that scenario, the same gambler would pay $90 for the bet, giving him an even chance of winning or losing $10. This is a microcosm of what the Public-Private Investment Program (PPIP) is intended to do: create an incentive for investors to pay $90 for a bet that is only worth $50. It is bad economics and bad public policy and it is probably fraudulent. Congress should act pre-emptively to halt Treasury Secretary Tim Geithner’s latest scheme. Paul Krugman pointed out that the plan is a “disguised way to subsidize purchases of bad assets.” Josef Stiglitz commented that Geithner’s plan “only works if the taxpayer loses big time.”

Bogus

clipped from www.mises.org Judging from Greenspan's description, the reader would think that the federal-funds rate (which the Fed directly targets with its open-market operations) and the mortgage rate moved along in sync, when all of a sudden Greenspan tried to jack up short-term rates in 2004, and yet those pesky mortgage rates refused to move up. Hence, he did what he could to slow the housing bubble, but alas, it was precisely when he tried to help that the markets rendered him impotent. So it's true, the red and blue lines in the chart above moved pretty much in lockstep up until 2002, as Greenspan claimed. But the disconnect occurred when Greenspan slashed short-term rates while mortgage rates held steady. To repeat, Greenspan's defense of his policies made it sound as if he tried to push up mortgage rates, but that they wouldn't budge. Yet, as the chart above makes clear, Greenspan didn't really push up very hard on rates.