Recently in Politics Category

Yes, opacity is what we need more of

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This may be the stupidest thing I have heard recently - I knew it was probably coming, but that doesn't make it less stupid.

Basically, this is stupid because it allows investment holders to essentially "use their own judgement" in determining the value of those investments. If the market for those investments is not good (i.e. they are not worth very much) then the investment holder can pretend the investments are still worth what they would like them to be, rather than declaring them on their balance sheet at their actual value. This reduces transparency - financial reports will say everythign is just fine, until it's too late.

This is the kind of thinking that got s where we are today.

I assume that this means that homeowners will be able to borrow money against their homes at the value their "internal model" indicates the home is worth, rather than wha the appraiser tells the bank it's worth. Right? I mean, that's only logical.

War? Good God.

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So now conservatives are saying that the New Deal had nothing to do with ending the depression. That government spending cannot stimulate the economy, and that government spending has never created a single job.

They follow this up by saying that World War II is what got the economy back on it's feet.

I can only assume this means that World War II was an act of the private sector, as opposed to government spending and job creating on a grand scale.


Deep Thought

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Spending taxpayer dollars building schools, roads and infrastructure in Iraq is spreading (small "D") democracy. Doing so in America is plunging the country into (big "C") Communism.

Our dialog is ruled by idiots. And Republicans. (Note that I was nice enough to make a distinction).


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It never fails to crack me up when preachers like Rick Warren claim that extending marriage to gays is the moral equivalent of allowing polygamy and child marriage. They then insist that we must keep marriage defined as it has been for the last 5,000 years. Which, you know, generally included polygamy and child marriage. I wonder if these guys have ever actually cracked a bible open? Polygamy and child brides are all over the bible, including all the big names, like Abraham and Solomon. We won't even go into what is going on between King David and Jonathan, though I guess since that was on the down low it was okay.

These people never fail to amuse. It's just too bad that they continue to be taken seriously in our political landscape. I hate to tell Pastor Rick this, but even if he manages to somehow stamp gays out of the public eye, he is still going to have those funny feelings when he watches a football game.

How to Say "Thank You"!

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I am vastly entertained to find that now that the banks have their bailout and are going to be getting thousands of my tax dollars they have taken the time out of their busy schedule to send me personalized "thank yous".

So far in the last two weeks I have received notice from three credit card companies informing that they are going to raise my rates by between 2% and 5%, even though I have not missed any payments or in any other way been a problem for them.

Now, of course, I can avoid these increases if I want to. I will have to do this by closing out the accounts, in writing, within about two weeks, which is a hassle in and of itself in - really? I can't call you, or take advantage of the online services that you otherwise love to push me off on to? Also, if I choose to avoid these extra charges by closing the accounts my credit rating actually takes a hit! All while the dick that runs Merrill Lynch insists he deserves a 10 million dollar bonus!

This is just as much fun as being told that after avoiding a crappy American car and spending my money on a well made foreign car I will still end up underwriting years of terrible decisions in Detroit, since they are just going to take the money anyway.

Bailouts are fun!

And He Would Have Got Away With It...

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If it wasn't for you meddling kids!

Let's hear it for high youth voter turn out!

UPDATE: Actually, that guy that gave McCain's concession speech was pretty good - if only he had run...he might have had a chance!

Get Out!!!! The Vote.

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No matter who you plan to vote for, it's important that, on election day, you go out and exercise your right to vote. Unless you are voting for John McCain, in which case you should stay home, because I have heard that there are some kids that are planning to totally get all up in your lawn on November 4th.

Really against John McCain. I have this great picture I made that I want to post, but it's only funny if he loses. Really, have you got anything better to base you vote on? I didn't think so. (Young voters are ESPECIALLY encouraged. Really, it's extra funny then)

I went down and cast my vote early today. Because it's too late for it to matter to me, I fully expect that Barack Obama will now reveal that he is a secret Muslim terrorist. If he doesn't, I will feel like I threw my vote away. Death to America!

Sarah Palin is a Dumb Person*: Episode 362

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Sarah Palin does not understand anything. Here is more proof that she has no idea what she is talking about:

If [the media] convince enough voters that that is negative campaigning, for me to call Barack Obama out on his associations," Palin said, "then I don't know what the future of our country would be in terms of First Amendment rights and our ability to ask questions without fear of attacks by the mainstream media.

Since I know she has never read the first amendment I will reprint it here for her:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.

Dear stupid person running for V.P. - The first amendment says the FEDERAL GOVERNMENT can't restrict your speech. When the media call you out on being an ass that is actually an EXERCISE of first amendment rights! It's actually WHAT THE RIGHT IS ALL ABOUT!

UPDATE: I have just been reminded that she has a degree in Journalism - which she apparently got without understanding a single thing about journalism! I am not saying that I have proof that she slept with her professors, but it would be irresponsible for me not to speculate about it.

* Some people think it is mean to say that Sarah Palin is a dummy with no clue what she is talking about. I actually think that assuming she is simply ignorant and not smart enough to learn anything is a compliment - the other option is that she is intentionally lying about things and is a venal, evil person without scruples that would say anything to further her career. Since that would be a mean thing to think of anyone I instead prefer to think that she is not too bright and doesn't understand this stuff.

Don't Vote for the Scary Socialist

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"...we’re set up, unlike other states in the union, where it’s collectively Alaskans own the resources. So we share in the wealth when the development of these resources occurs."

- Sarah Palin speaking to Phillip Gourevitch of the New Yorker

The funny thing is, I really don't think she even knows enough about political and economic science to understand how stupid she is.

Yay! Real Socialism!

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So, it looks like the Treasury is finally beginning to realize that direct capital injection is the way to go. They didn't want it in the bill, tutted when it made through and passed, and now have decided to start using it. I think that the fact the Brits did it yesterday (to the tune of an equivalent $500B, adjusted for the size of their economy vs the U.S.) had a lot to do with it. I thought it was great that it got slid in there, but I assumed that we would not see it used in this administration.

The idea is that instead of buying up a lot of toxic debt that cannot be realistically priced, the government will instead invest money into the banks themselves (and hey, probably other things eventually, like car manufacturers - just wait!). In return the government will get preferred stock, either with a promised return (like, say, Warren Buffet), or at least with priority in dividends over regular investors. This might seem unfair, but keep in mind that the other option is that the bank goes under and the investors lose a pretty good deal over all. This will provide the financial system with additional capital...and the calm and reassurance that comes with that. Hopefully the credit markets improve, and this will fix the commercial paper problems that are causing us to teeter on the precipice of doom. Also, if we are shareholders then we can call for the executives and the boards that got us into the position to be fired and their ridiculous golden parachutes (or Suckage Insurance) rescinded. Appropriate to their business acumen there people can then be offered positions as shift Managers at WalMarts across the country.

Once disaster is averted, and the banks are better capitalized, they can start to address the issue of how to fix the toxic mortgage problem. They will hate doing this since it's mostly going to involve re-writing adjustable mortgages to thirty year fixed at around 6-8% fixed apr. Reasonable, but not great for both sides, but good enough that it could keep some people in their homes. In some cases where homes are underwater banks are going to have to bite the bullet, realize how much they would lose in a foreclosure, and do what so many small business owners do when they have shelves filled with crappy product that is not moving - mark it down to reflect the the new, lower, values. They will lose pretend money, but less than they would if they foreclosed and sold at auction, probably, with all the attendant costs.

Individual home owners who took out equity 3 times the value of their house will have their Lexus cars, Big Screen TVs and other luxury items bought on credit repossessed, and they will be placed into stocks in front of their homes with signs around their necks showing the amount of actual money they put into their homes ($9000) and the amount of equity they borrowed against them ($450,000). Clanking below the stocks will be metal buckets into which passersby may place coins. Once the homeowners have collected enough coins to cover the principle (after all, we are not monsters) on their home equity loans their first mortgages will be written down to the market value and refinance as fixed rate loans. For the years they have spent in the stocks they will get a $1000 credit to use at the Salvation Army or Goodwill to refurnish their homes.

This is a good thing. This (if you ignore the snark above) is the most orderly way to approach this problem, short of having a time machine to go back and put proper regulations in place 10 years ago.

This problem is the result of a lot of things (oddly, not of any of the things John McCain talks about), and it was encouraged by deregulation from both the Republican and Democratic wings of our single party system (you do realize that we have a one party system in America, where we choose between the middle right and the far right wings of the party, while everything in the party's left of middle get's ignored, right? That's another blog post though). The only way to fix it is sensible regulation.

People don't seem to remember that markets needs rules in order to thrive. Not stupid rules though. Since I am in trucking I will use an example from there - the old (70s) trucking regulations that required everyone to charge the same for the same freight going the same distance. This is a stupid regulation that (obviously) stifles competition. The has been rescinded now, and the newer regulations have to do with safety - the maximum hours and breaks for a long haul driver, for example. This is something that makes some degree of sense, since it's regulating an area of the market that the public has an over riding interest in - the safety of the trucks on the road. Trucks also have to obey the laws of the road - speed limits, stop signs and obey maximum weight limits on some roads and clearly label dangerous cargo.

This is exactly the same kind of regulation that markets need. Keep in mind that the market is, in many ways, an artificial construct, just like a game and a game without rules is a game that no one in their right mind should want to play.

I am actually hoping that this crisis will end up being a good thing, resulting more stable markets that bubble less often and don't pop as disastrously. Maybe Milton Friedman can finally be placed up on the shelf with equally discredited economic theorists like...oh...say...Marx (really - watch Duck Soup again). We are all Keynesians and Social Democrats now.

Also, I am betting on Dow 6000 before the election. Who want's to take over/under? I'm also betting on about a 3 year recovery, with severe short term contraction and steady, but slow growth starting from there and bringing us back to near where we are today, but with much more regulated and stable markets. Assuming Obama wins. If McCain wins we will be fighting with dogs over dead rats in the street with a year, and descending into cannibalism by mid-2010. And since no one will have electricity FOX will not even be able to make a reality show out of it.

Italicized items are satirical and not intended to be taken too seriously. Note the bit about McCain leading directly to cannibalism is NOT Italicized.

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