Friday, March 6, 2009

Derivatives v. Insurance

Yeah, I wish I didn't have to care about this either. Seriously, who the hell cared about Mortgage Backed Securities, and Credit Default Swaps, or Collateralized Mortgage Obligations besides the Masters of the Universe that were playing Texas Hold 'Em with peoples lives?  But now I have to care. And so do you.

Thankfully, the folks at TPM have been pretty good at explaining this mind-numbing - nay, mind-boggling stuff that might be otherwise hard to understand without a Harvard Business Degree.

So something new to add to this mess: the issue over Derivatives v. Insurance, and why that matters so much now. Here's a hint: it has much to do with that notoriously evil 2005 Bankruptcy bill foisted upon all the hapless suckers (meaning those who were not actually Masters of the Universe).

First read this, then read this.

TPM Must Read: Maiden Lane I, II, III

Lots of good stuff at TPM on economic craziness. We learn something unbelievable every day. This nugget from yesterday really turned my stomach. The Treasury is basically using Enron-style accounting tricks with the bailout. That scares the hell out of me.

By law, the Fed isn't allowed to buy assets -- it can only lend, as lender of last resort. That was a problem for the Bear Stearns bailout, because JP Morgan said it would only buy Bear if someone else assumed responsibility for the crap. Fed came up with this idea to start a shadow company, called a special purpose vehicle (SPVs were how Enron operated, creating "Chewco" and the like named after Chewbacca - the New York Fed called their SPV "Maiden Lane LLC" for name of the street the NY Fed is located on in southern Manhattan). The deal then was JP Morgan put $1 billion into Maiden Lane, the Fed put $29 billion in cash into it. Maiden Lane paid Bear Stearns $30 billion, which went straight back to JP Morgan as this deal happened simultaneously to JP's purchase of Bear. So Morgan got $30 billion in cash ($29 billion net) and the Fed got stuck owning the crap, but was legally only making a loan to Maiden Lane, who was the legal owner (Maiden Lane was incorporated not in NYC, but in Delaware to avoid paying taxes). By the Fed's own accounting - which is very different from a real company's accounting - Maiden Lane has lost $5 billion between its creation and today.

There's a lot more to this post.

Money madness

For some great visuals of what a trillion dollars looks like in stacks of $100 bills, there are some great illustrations at this site to help put things in perspective. For instance, this stack below is a trillion dollars. The area in red indicates $50 billion, the amount that Bernie Madoff is accused of ripping off his clients for. (The speck of red to the left indicates an average sized person).

Conyers response to Lessig

Yesterday, I received in my inbox a note from Lawrence Lessig about a proposal that John Conyers is trying to push through, one that will forbid scientists receiving government funds to openly publish their findings online, but rather force them to have to pay thousands of their own non-government dollars to publish in peer-review journals. Lessig also posted this article on HuffPo on the very same matter.

Conyers responded to Lessig at HuffPo as well, but I fail to see how I can side with Conyers on this one. I am all for peer review of science research findings, because peer review helps keep science honest. But publications and journals are not - and definitely should not - be the only means of peer review. There are innumerable instances of non-published peer review of research and findings, most of which may not have ever been possible if the scientists were forced to wait for review by the publications. Furthermore, the resource pool of the publications is large, but it cannot compare to the broader access in academia and the professional world.

My earlier post referenced an article by a science journalist with Discover magazine, and his points remain unaddressed by Conyers's rebuttal. But Conyers is right in that this is worthy of debate, but until Lessig called him out, there is no evidence that a debate was even going to happen.


Dark days for justice in America

If you thought Bush leaving office was a sign that things were turning around in America,you were wrong.

The Beltway media establishment is still pro-Republican, despite how ridiculous, petty, and few they've become. Democratic officials are outnumbered on television appearances 4 to 1, and even the center-left shows like Countdown with Keith Olbermann and the Rachel Maddow Show spend a good lot of their time re-hashing GOP appearances and footage from the hard-right shows, and the puppet-heads.

Al Franken is no closer to being certified the winner of the Minnesota senate race.

Bernie "$50B Ponzi Scheme" Madoff may be getting a plea deal.

As for the presumed Enlightened state of California, things are looking dark here too with one lone Republiscum able to singlehandedly block the passage of the state budget.

Adding to that, it now appears likely that the California Supreme Court will uphold Prop 8, which will set precedent for anyone in the future with enough money to use the Ballot Initiative process to strip any minority group of whatever rights they choose.

It gets worse. Former Democratic Governor of Alabama, Don Siegelman, who was convicted by a Republican-dominated court (indeed by a judge who is friends with Karl Rove) on trumped up charges brought by the AL state attorney who is married to a friend of Karl Rove, has lost his appeal on all but two charges to another court dominated by Republican judges.

But if you are getting your hopes up over the deal that Obama fenagled with Bush over getting Rove and Harriet Miers to testify about politicizing the Department of Justice, don't get too excited. Their testimony will not be under oath, but only under penalty of perjury, and behind closed doors. Remember all those cases that were successful when the witnesses didn't have to testify under oath? No? Didn't think so.

It looks like Rove has succeeded in his takedown of Siegelman, and he's going to walk away from this current hearing as well, thanks to the limp-wristed approach by the Obama administration. You know, that "Look forward, not back" approach to everything. The real problem with that approach is that by ignoring past misdeeds, Obama is tacitly guaranteeing that those same misdeeds WILL HAPPEN AGAIN. Where's the change in that?

To be fair, Obama has only been in office for a very short time, and he has a lot on his plate. Sure, Obama is doing some good things, like overturning Bush's ban on stem-cell research, and making health care reform a major issue. And while he's also done some other good, like releasing a batch of those horrible legal memos drafted by Bush's Office of Legal Council, he has done so on the heels of upholding one of the most egregious of Bush's power grabs, the wanton abuse of the State Secrets privilege, despite his campaign pledge that he would reverse it. Given the pattern of behavior that seems to be emerging here, I hold out little hope that we will see any real justice with regards to the crimes of the Bush administration, and if we do, it won't be because of Obama's help, but perhaps in spite of it.

That said, I'm still giving Obama the benefit of doubt, and I will very gladly admit my errors of judgment if I am wrong. I hope I am.

Animal Farm Friday: Off-color in Louisiana

For his lineage, the Louisiana Governor Bobby Jindal (R) is certainly seems off-color, being one of the brownest white men you will ever meet. Also from the Gulf state, we find another creature off-color for its kind. This being the albino bottle-nose dolphin recently discovered. But just because it's albino doesn't mean it's white. This one happens to be pink.

Is Conyers bought and paid for?

For all the (sort of) good he's been doing pursuing egregious and corrupt acts by the Bushies, he's got a few of his own that are down right disgusting. This is one of the newest that's been picking up lots of buzz on the Internets:

John Conyers (D-MI) [...] is pushing a bill through Congress that will literally ban the open access of these papers, forcing scientists to only publish in journals. This may not sound like a big deal, but journals are very expensive. They can cost a fortune: The Astrophysical Journal costs over $2000/year, and they charge scientists to publish in them! So this bill would force scientists to spend money to publish, and force you to spend money to read them.

Why would Conyers do this? Interestingly, if you look at the bill sponsors, you find that they received twice as much money on average in donations from journal publishers than Congresscritters who don’t sponsor the bill — though to be fair, the total amount is not large. Still, Conyers got 4 times as much.


Ironically, this bill is called The Fair Copyright in Research Works Act, which is much like the Clean Air Clear Skies Act or the Patriot Act, in that it does exactly the opposite of what its name says. This bill is not fair, it puts a burden on scientists and keeps research from being publicly accessible as it should be. I myself rely on things like Astro-ph to do my reporting here; it could become illegal to post papers there for federally-sponsored scientists if this bill is passed.

The brother is going to have to knock off this kind of crap before some of us science-loving populists decide he needs to be brought up on corruption charges of his own.

Thursday, March 5, 2009

And so it begins...

Mark this as the beginning of the end for humans and the rise of the machines?

Holy Bile: The destructiveness of the Roman Catholic church

Starting a new category to complement Raisin of Reason. I'm calling it Holy Bible (since the header can't support the strikeout tag, it will read as Holy Bile, which is what I'm going for anyway, sans the geek factor).

Today's first entry goes this story of a Roman Catholic archbishop in Brazil for excommunicating a 9-year-old girl's mother and her doctors for aborting the twins she was carrying as a result of being raped by her stepfather.

In the long run, being kicked out of the Catholic church could be better for the family. This is their opportunity to hopefully learn just how destructive and evil the Roman Catholic church really is. Not to mention that giving birth would probably have killed the little girl. And would the church accept responsibility for that, the same way they've accepted responsibility for ruining the lives of so many children raped and molested by Roman Catholic clergy? It appears that the church is against aborting fetuses, but they are all for destroying the lives of children.

What makes a Conservative

Sounds like every Conservative schmuck I've ever met!
Four researchers who culled through 50 years of research literature about the psychology of conservatism report that at the core of political conservatism is the resistance to change and a tolerance for inequality, and that some of the common psychological factors linked to political conservatism include:
  • Fear and aggression
  • Dogmatism and intolerance of ambiguity
  • Uncertainty avoidance
  • Need for cognitive closure
  • Terror management

Just asking...

If it's legal to marry your first cousin in California (and Florida, and Arizona, and 32 other states, why aren't same-sex marriages allowed?

The mother of all mashups!

Wicked awesome!

Raisin of Reason: Religious people don't use their brains

The proof is in the science: Religious people do not think.

In two studies led by Assistant Psychology Professor Michael Inzlicht, participants performed a Stroop task – a well-known test of cognitive control – while hooked up to electrodes that measured their brain activity.

Compared to non-believers, the religious participants showed significantly less activity in the anterior cingulate cortex (ACC), a portion of the brain that helps modify behavior by signaling when attention and control are needed, usually as a result of some anxiety-producing event like making a mistake. The stronger their religious zeal and the more they believed in God, the less their ACC fired in response to their own errors, and the fewer errors they made.

At the rally before the California Supreme Court this morning, I heard a religious asshole with a bullhorn this shouting at someone from his own side saying:

"People need to stop thinking for themselves, and start reading the Bible instead.

If [you] have an opinion different from someone else's [sic], you should keep your mouth shut." (Oblivious to the irony that he was shouting this through a bullhorn.)

Self-evident, too.

Wednesday, March 4, 2009

Raisin of Reason: Some smarts from Susie Smartypants

(h/t Pharygula)

Tuesday, March 3, 2009

Something from TNR that isn't garbage

From Jonathan Chait no less. I applaud Mr. Chait for calling out an incredibly stupid reporter and her stupid report with some stupid rich people for being, well, stupid.

I've seen a lot of dumb news reports in my life, but I'm not sure anything can quite match this one from ABC News. The premise of the report is this: Barack Obama plans to raise taxes on people who make more than $250,000, so the reporter has gone and found people who earn a little more than that sum who plan to decrease their income so that they come in underneath the magic line.

Now, the obvious objection here is that the tax code doesn't work that way. A tax increase affects the marginal dollar that a person gains. That's means only every dollar over $250,000 is taxed at a higher rate. Obama is not proposing a tax system whereby somebody who goes from $249,999 to $250,000 suddenly becomes poorer. Nobody has ever enacted a tax hike like that in the history of the United States.

That doesn't stop ABC News' intrepid reporter. This story has to be read to be believed:

Generally, I am disinclined to link to anything from TNR, but this is worth it. So go read the rest of the post.

That's what I've been saying

But I'm not an investment guru like Jim Rogers:

"Suppose AIG goes bankrupt, it is better that AIG goes bankrupt and we have a horrible two or three years than that the whole US goes bankrupt," Rogers said. "AIG has trillions of dollars of obligations, let them fail, let the courts sort it out and start over. Otherwise we'll never start over."


"The idea that you have too much debt, too much borrowing and too much consumption and you're going to solve that problem with more debt, more consumption and more borrowing? These people are nuts."


"Power is shifting now from the money shifters, the guys who trade paper and money, to people who produce real goods. What you should do is become a farmer, or start a farming network," Rogers said.

Just say when

I've been working on an essay on the Fallacy of Conservatism for a while now, and just when I think I've got the premise dialed in, some Republiscum goes and blows it for me. While I've been drafting this essay, I keep getting short-stopped when I hit on something I find too cartoon-ish or just generally unbelievable about modern Conservatives and Republicans. And then I wake up and read in the news or blogs of somet new and astoundingly stupid thing some Conservative or Republiscum has said/opined/been convicted or indicted of, and I have to go back to the outline and start the draft over.

When Conservatives/Republiscums had their fingers on the buttons and their hands on the purse strings, they were worth taking seriously, even knowing all along the pathetic and un-funny collective joke that they have always been. But even I am amazed at just how amazingly ridiculous and bufoonish they are now that they pose no serious political threat (short of the militant uprising they are trying to foment).

I think I'll just sit back and see how much rope these 'tards will keep pulling out, and how many will hang themselves in the process.

Treason, Sedition, or Just Plain Stupidity?

Just a quick note on this "rebellion" garbage popping onto the radar screen from the Republiscums is something I think should be taken seriously. As angry and hateful as I have been to the Bushies/Neo-Cons/ex-Nixonians/Conservatives/Republiscums, I've always kept my anger in check. I may have forgotten my civil tongue in the presence of close company, but I've never publicly advocated revolution, secession, or insurrection, i.e., in a setting that could never have been perceived as anything more than an expression of frustration. But when idiots and assholes openly and publicly advocate for armed takeover and/or violent transfer of power, they have crossed the Rubicon, and should be immediately condemned as enemies of the state, and dealt with accordingly.

To be clear, I am not against people expressing their grievances against their government. I've done quite a lot of that over the past eight years. I also believe that a time may arise when political actors need to be removed from office by force. But those times are - and must be - extremely rare. Only when the majority - or some number coming close to that - is being oppressed by a minority, or when the elected leaders are willfully and deliberately violating the Constitution, should force be considered an option. But, force is only an option when all other civil options have been completely exhausted. Then, and only then, should civil - or non-civil - disobedience be considered an option. But that said, any type of non-civil opposition should expect - and certainly deserves - fierce opposition from the sitting polity.

My main opinion here is that any and every American citizen advocating or publicly discussing armed and violent overthrow of an elected official or body of government should expect to be considered enemies of the state and treated as such. If and when they are found guilty of same, they should also not be surprised if they find themselves guilty of treason, and dealt with accordingly. Some asshole said on Hannity's forum, "it's only treason if your side loses" (or something to that effect). While this may be true, I wonder how many of these Republiscum blowhard assholes are brave enough to ante up. I'm sure they'd make fine bullet-stoppers.

I say put up or shut up, or suffer the consequences for either , because we are - if nothing else - a nation of laws, not men.

Monday, March 2, 2009

Raisin of Reason: Atheist Toast

Atheist Toast by Mrs B (aka Chi).

yep there's No hidden picture of Jesus or the Virgin-Mary - it's just toast.
For as we used to say as students "Toast is the Truth" - Mrs B (aka Chi)


Why does THIS not surprise me?