Links 9/6/08

Balls found inside ‘rattling’ dog BBC

Solar energy can meet all the world’s energy demands PhysOrg

Children aged eight enlisted as council snoopers Telegraph

Is “Five Yeshiva Butchers” Good for the Jews? Ken Houghton, Angry Bear

Times Plans to Combine Sections of the Paper New York Times. A recession indicator.

Oil, Stock, and Housing Declines Bespoke Investment Group

U.S. wants “substantial” prison for Gen Re, AIG execs Reuters

The Sarah Palin Church Video Part One You Tube (hat tip Felix Salmon). I have developed an intense dislike for Palin, so feel free to send any suitable items.

Antidote du jour:

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  1. Anonymous

    Yves, stick to what you know…Economics. There was nothing objectionable in the Palin Youtube video you posted. What?? She believes in God? Is that a hate crime in your brainwashed book of political correctness?

  2. doc holiday

    This is the look of bewilderment that most people have as they read about Fannie and Freddie and yet another stunning and strategically timed weekend rescue of two components connected to the mechanism of commerce which pushes the mortgage chain linked to the Fraudulent Ownership Society which has now exploded into fragments in a burst of triumphant entropy which McCain & Friends Of Mozilla are saluting, as the band plays:

    This land is your land, this land is my land
    From California, to the New York Island
    From the redwood forest, to the gulf stream waters
    This land was made for you and me

    As I was walking a ribbon of highway
    I saw above me an endless skyway
    I saw below me a golden valley
    This land was made for you and me…

  3. dh

    It’s Just Gross
    Posted by MarketBeat Staff
    Steven Russolillo writes:

    “Am I the only one irritated by the fawning treatment given Pimco’s Bill Gross and his commentary?” Paul Kedrosky asks. Gross calls for fiscal policies that “open up the balance sheet of the Treasury” to prevent a continuing asset and debt liquidation of “near historic proportions.” Kedrosky says Gross’ threat of a bond buyer’s strike is “deliriously self-serving. He is into mortgage-backed bonds and Fannie/Freddie up to his neck, and now he wants Treasury to bail him out or he’ll stop buying? How lovely.”

    Anon, go here:

  4. Sarah Pas Malin

    Mr. Smith, I’m part of God’s design for this great country. I’ll have you fired from your own blog if you don’t like me.

  5. dh

    Yves, this is a start???

    Re: I have developed an intense dislike for Palin, so feel free to send any suitable items.

    >> “It's the dumbest idea I ever heard,'' said New Jersey Governor Jon Corzine, the Democrat and former chairman of investment bank Goldman, Sachs & Co. “It's speculating the way I would have speculated in my bond position at Goldman Sachs.''

    Pension bonds are making a comeback, as states and cities from Alaska to Philadelphia bet they can use the proceeds to help fill deficits in their retirement funds and still generate a higher return than what they pay in interest.

    Alaska, Wisconsin

    Alaska lawmakers sent Republican Governor Sarah Palin legislation last month authorizing the sale of as much as $5 billion in pension bonds. Wisconsin Governor Jim Doyle, a Democrat, signed a law in March permitting Milwaukee County to borrow money to close a $406 million deficit.

    Also see:

  6. dh

    The unfunded liabilities of the state's Public Employees' Retirement System and Teachers' Retirement System exceed $8 billion. The bill creates a new Alaska Pension Obligation Bond Corp. to issue the debt, though it also authorizes the Alaska Municipal Bond Bank Authority, Alaska Housing Finance Corp., and the state bond committee to issue POBs. It is the new Pension Obligation Bond Corp that will be used to conduct the transaction, according to Andrews, who played a key role in drafting the legislation. "We still have to go out for a procurement for bond counsel, financial advisers, and investment bankers," he said. "There's a lot of work that needs to be done."

    Last week, Palin signed a supplemental bill that placed $3.6 billion into Alaska's Constitutional Budget Reserve and Statutory Budget Reserve funds. By comparison, the governor's entire general fund operating and capital proposal for fiscal 2009 called for $4.4 billion in spending, though lawmakers are expected to load the capital up massively before their scheduled adjournment Sunday. Alaska uses its full authorization, it would be the second-largest POB deal on record, according to Thomson Financial data.

    Risky Business? Evaluating the Use of Pension Obligation Bonds

    As attractive as this plan may appear from a budgetary perspective, the issuance of pension bonds generally carries significant risks that are often downplayed in light of immediate fiscal pressures and the concerns of pensioners. Using two pension bond issues by a previous adopter ofthis strategy, this article evaluates the conditions under which pen-sion bond issuance may or may not be appropriate

    Like any financial debt instrument, pension bonds are two-edged swords. In the hands of the right borrower, a well-designedpension bond issue may play a useful if limited role in managing pension fund obligations. However, a poorly designed issue forthe account of an inappropriate borrower may simply reflect adesperate effort to avoid coming to terms with fiscal reality, withunpleasant ultimate consequences for all concerned..

    >> San Diego Mayor Race Is Exposing The Pension Obligation Bond Nightmare
    Submitted by pdxnag on Mon, 10/11/2004 – 4:20am.
    The recipe begins with government folks writing pre-dated checks called pension benefits. It comes in many forms. It is like you writing a check from your checkbook, with a future date on it, hoping that you can get the money into the account before someone tries to cash it. Simple enough.

    The pension bond is used to flush up the account, as needed, and however many times as is needed over and over and over again, until all the gift checks are covered. There is no release obtained by the government when they flush up the account to cover the gifts that they never could afford to pay in the first place.

    Are the pension obligation bond peddlers the evil folks starting, or at least encouraging, the runaway gift giving? Are the gift givers doing nothing more than throwing money away to buy political loyalty? Are they a tag team of thieves? RICO RICO RICO. The gift giving by the government folks could not continue, and expand, without the pension obligation bond peddlers enabling, and leveraging, the gift giving ability of the present set of gift givers. Wall Street casino gamers must be laughing all the way to the bank because the borrowed money is often tossed into the casino. The legal advisor folks seem to think that the more money a pension losses the better because they say that just means more borrowing. The cycle of wacko-ness just gets worse over time. It is a gambling addict phenomenon.

    SEE ALSO: Under Alaska Constitution, “debt” must be for capital improvements and approved by voters.

    Restrictions do not apply to “Certificates of Participation” or other obligations subject to appropriation.

    Subject-to-appropriation debt is somewhat more expensive than full faith and credit debt.
    Although some home rule municipalities may be able to issue obligations under their own charter provisions, there is no general statutory authority for the issuance of pension obligation bonds.

  7. etc

    yves: “I have developed an intense dislike for Palin, so feel free to send any suitable items.”

    Please specify your concerns.

  8. Anonymous

    it’s your blog so write what you want . . . . I’d much rather be governed by 100 hillbillies from Alaska than the top 100 graduates of Harvard and Yale Law.

    Remember JFK and Bob McNamara and the best and brightest? How’d that work out?

  9. Richmond Rambler

    Hi Yves,

    I too loathe Palin. Is this what my mother and other women fought for in the workplace during the 70s? I don’t think so. And yet I fear we are looking at a Palin/McCain White House. My husband and I moved to Richmond, VA from Paris last year, and we have been shocked by the redness of this state. Our neighborhood is liberal (lots of Obama posters) but still uncomfortably segregated. Though the other day I witnessed a very touching scene — a group of five or six grey-haired elderly African-Americans (three with canes) going door to door on behalf of O’s campaign. I kid you not, it took one of the women five minutes to climb as many stairs. And then to see Palin that night; well, I was just beside myself with fear and anger.

    Lincoln kept a volume of Shakespeare on his nightstand. Jefferson, despite his hypocrisies, was brilliant and incredibly erudite. Who are these people who want lackluster brains in our most powerful offices? People with lackluster brains.

    You’ve probably read Judith Warner’s Mirrored Ceiling article in the NYT. Very well-written. But have you read through the comments? Doing so made me feel normal for the first time in days. Elizabeth Fuller’s (#5) comment is perfect.

  10. Anonymous

    Yves: Thank you for the link to the Palin speech. From it we learn more about the Republican VP nominee and her brand of Christianity. In the youtube talk, she celebrates “God’s plan for the new pipeline”. In her convention speech, she spoke with contempt toward community organizers who toil in the fields serving the least among us — which was, until the advent of contemporary Republican Christianist doctrine, the most famous of the admonitions from Jesus.

  11. etc

    You people expressing some vague cultural hostility to either Obama or Palin are lowering the quality of this blog. If you’re going to comment on them, please try to say something interesting, entertaining, or useful.

  12. Anonymous

    ***You people expressing some vague cultural hostility to either Obama or Palin are lowering the quality of this blog. If you’re going to comment on them, please try to say something interesting, entertaining, or useful.***

    haha, ya seriously. You’d think with so many blogs out there one could find a place to rant incessantly that’s more relevant to ranting than nakedcap.

    The internet has turned society away from dialogues and towards incessant ranting at one another. sigh.

  13. Anonymous

    anon 7:39,

    I went to yourpro-palin shrine and found this :

    As an oil producer, the high price of oil has created a budget surplus in Alaska. Rather than invest this surplus in technology that will
    make us energy independent and increase efficiency, as Governor she proposed distribution of this surplus to every individual in the state.

    >> To me, this is one of the problems I have with people like this mutt, i.e, they live in a state and feel the natural resources belong to them and that they should be able to exploit their environment for short term thinking. This was the core issue in The Civil War — Southern states did as they wanted to exploit slaves and they didn't want accountability from The Union. Palin is a hack that does not represent the values of America, she represents self serving greed and if you can't see that she was buying cheap votes, then your blind!

  14. bg


    I know you are human, and so have legitimate biases. But I had you on a pedestal for your clear writing, wide knowledge and macroeconomic wisdom.

    Sarah Palin is an impressive person, with her conviction and accomplishments. I say that with real disagreements with her politics. You lessen yourself by flashing your biases.

  15. dearieme

    The goatherd’s boy versus the mooseslayer sounds like a good contest. What exactly is the role of the two elderly white gents?

  16. donna

    Aw, c’mon, I want my $3000 a year from the oil companies too! I mean if Alaska is entitled to it, aren’t we all?

    Then again, she left her city with $20 million in debt, even after asking for $30 million from the Feds. And Alaska gets more federal pork per capita than any other state. But I guess she could just go lobby China and the sovereign wealth funds to put us on their dole.

    “Reformer” my ass.

  17. Cash Mundy

    And when thou prayest, thou shalt not be as the hypocrites are: for they love to pray standing in the synagogues and in the corners of the streets, that they may be seen of men….when thou prayest, enter into thy closet and when thou has shut thy door, pray to thy Father which is in secret…

    Cash’s Two Bits, completely non-financial

  18. Independent Accountant

    Are these English kids “Hitler Youth” or members of Jimmy Carter’s “Young Adult Conservation Corp”?

  19. doc holiday

    Re: "I know you are human, and so have legitimate biases"

    >> Go away, this is my animal section and I need my space; it's crap like this that prevents me from focusing on the cat picture at hand, so your bullshit is off topic, go on, get!

  20. Highgamma

    I found the video reassuring. I know that she’s deeply religious (as have been many of our best leaders) but she draws a clear line between what she does in the secular world and what these students have prepared themselves to do in the nonsecular world.

  21. Anonymous

    Yves, I disagree with the first poster. I don’t think most Americans are political enough. I believe it’s important that people see the political opinions of others they respect. It’s important that the issues are discussed by real people. The media coverage is all for show.

    If you haven’t already been reading this, it’s good writing by a an Alaskan on Palin.

  22. m

    Can someone explain to me how, for financials, the bailout is any different than the bailout for Bear Sterns? There was a HUGE bounce from March to May because of the assumption that all the big banks would be too big to fail and would be bailed out. Now it seems to me that there will be a HUGE bounce, maybe to May highs?, because basically mortgages are too big to fail and are being supported directly by the U.S. govt, so the spreads will decrease and mortgage rates will decrease = everything’s rosy, the big banks who have lots of FNM and FRE debt will make some money too. Obviously this is bullshit and we’re heading into Japan territory, but it seems like we could have a couple month bounce from this and hit 12,250 to 12,500 on the dow. Is this a wrong inference?

    I should qualify this further. Lots of retail investors in SKF. The way the big boys make money is by playing counter-trend short-midterm and fucking those retail investors. They need some sort of flag signaling to their buddies that it’s time to drive up the market. If this isn’t the next flag, what is?

    (I don’t think the bailout will hurt preferred shares at all or wipe out common shares. From what I hear it will be dillutive with new injections quarter by quarter. Worst possible outcome for the American taxpayer)

  23. jest

    in defense of yves (not that she needs it) this is her blog, and she can say whatever she likes about palin here.

    if you don’t like it ignore the comments, or go to another blog, but the complaining is unnecessary.

  24. Juan

    sad to say, as a representation of the flaws and foibles of america’s ‘down home’ women, attacks on palin are taken to be attacks on them, which generates sympathy on one hand and resentment on the other–a combination that can intensify, possibly expand, republican right wing populism. (perhaps better labeled ‘right corporatism’)

  25. doc holiday

    The worst outcome of this election is the polarization that will divide people even further into smaller fragmented groups that grow further apart. Palin represents the good ol’ boy of Bush and the young zesty leadership potential that McCain lacks, and as unbelievable as those qualities may be, this is what a lot of Americans think they want. This downhome image that plays upon the couch potato alcoholic that has less than a high school education, may be a perfect fit for unlocking fence-sitter Palin votes — but will these several hundred votes be enough to fire up the rusted and tarnished Republican engine that is stalled in the roundhouse? I don’t know BillyBob, why don’t we drink about it and surf for porn?

  26. Dean

    Eureka!Eurka! I know why Yves dislikes Sarah. According to an astrologer she is the “anti-Obama”. Here is why(excerpt from the astrologer’s report):

    “And what about Sarah Palin? Who is she and what was that energy she brought to the convention on Wednesday night? Although there is no confirmed data on her birth time, there is an unconfirmed report that she was born at 4:40 PM on February 11, 1964, in Sandpoint, Idaho. If correct, then she is an Aquarian with Leo rising, just the mirror image (or exact opposite) of Barack Obama, who is a Leo with Aquarius rising. Sometimes astrology is just too amazing to ignore. She is the “new Obama” as far as sudden fame and fascination by the U.S. public. She is probably the exact opposite to him on every policy issue, but has perhaps the same powerful and charismatic effect on her party as he does on his. And who will ever forget her line comparing her experience to Obama’s… “Well, I guess a small town mayor is like a community organizer with responsibilities.” Whew! This is rapidly becoming the most exciting election in a lifetime.”

    Oh, Boy!

  27. Cash Mundy

    Juan, Corporatism indeed. The Republican Base of today closely matches in spirit another Base from the last century: a passionate conviction of national and/or racial and/or religious supremacy, narcissistic outrage at contradiction and prompt resort to violence, a continual state of righteous indignation, and a sense of national decline caused by enemies within and without.

    Dean, I think you have found the key to understanding this whole situation. We have already been informed by reliable sources (ziocon hatchetmen and their plentiful useful idiots) that Obama is none other than the Anti-Christ! If Palin is in fact the Anti-Obama, then she is the Anti-Anti-Christ! Could somebody please do the math on that? My brain hurts!

  28. Dean


    Well, she can’t be Christ but Mother Mary or a close cousin you think?

    Don’t tell me we are gonna have another DaVinci Code with Sarah Palin as another Merovingian! or better yet the Windsor-Bush bloodline! Oh, no!

  29. Richmond Rambler

    Juan, Although what you say is likely true, the choice NOT to point out Palin’s considerable short-comings reeks of the kind of appeasement that’s been pecking away the Democratic guts for too long. It’s offensive how quickly people (namely many Dems) will let the other side define and delimit them.

    One scary thing about Palin and McCain is that people seem willing to adopt them as family members — with all the irrational loyalty and defending/shrugging away of foibles that implies.

  30. doc holiday

    Re: “One scary thing about Palin and McCain is that people seem willing to adopt them as family members”

    I think you refer to the potential of Palin to be the alcoholic failure and drugged out sister that could be almost any of us at almost any time of the day, as we run low on blood sugar and then spring back to the person we really is…LOL!

    Children growing up in a dysfunctional family have been known to adopt one or more of six basic roles:[citation needed]
    “The Good Child” – a child who assumes the parental role.
    “The Problem Child” – the child who is blamed for most problems, in spite of often being the only emotionally stable one in the family.
    “The Caretaker” – the one who takes responsibility for the emotional well-being of the family.
    “The Lost Child” – the inconspicuous, quiet one, whose needs are often ignored or hidden.
    “The Mascot” – uses comedy to divert attention away from the increasingly dysfunctional family system.
    “The Mastermind” – the opportunist who capitalizes on the other family members’ faults in order to get whatever he/she wants.

  31. Anonymous

    The election via the MSM will never be about healthcare, tax reform, runaway gov’t spending or even the overloaded debt ridden J6P and what can be done about it. Rather is will be another high school beauty contest with issues of likeablity the hot issue.

  32. Cash Mundy

    Yes, another high-school beauty-contest indeed, or equivalently like professional wrestling: Sweet Saint Sarah defeats (for the outcome must be known in advance: the electorate is upset by uncertainty) Osama the Anti-Christ and Keeps the World Safe for White Christian Womanhood.

    Churchill (one of my favorites despite his politics):

    Many forms of Government have been tried and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed, it has been said that democracy is the worst form of government except all those other forms that have been tried from time to time.


    …What were those other forms again?…

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