Links 10/18/08

African chimps decline ‘alarming‘ BBC

Friday Research Fix: Playboy Playmates and Economic Conditions Paul Kedrosky

Response to 9/11 was ‘huge overreaction’ – ex-MI5 chief Guardian. Guaranteed this story will get no play in the US.

Fighting The Last Depression While Ushering In The Next One John Carey, Clusterstock

Foreign central banks seek safety; the Fed, by contrast … Brad Setser

Troubles for New York Hotels New York Times

Putin May Use Credit Squeeze to `Destroy’ Oligarchs Bloomberg

Bankers’ £16bn bonus bonanza Independent

Hedge fund manager slams ‘idiot’ bankers Financial Times. Andrew Ladhe exits with a very successful record and savages the industry. Read the full text of his final letter to investors.

Wall Street banks in $70bn staff payout Guardian. Intriguing that the UK press is more on top of the continued substantial pay to investment bank employees than its US peers.

Appraisal Fraud in the Spotlight, Again Housing Wire

Hot money inflows have gone down, nervousness gone up Michael Pettis

China’s Golden Age Eliot Weinberger New York Review of Books

Antidote du jour:

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  1. a

    I just can’t take it any more. Here are the bonus figures for some banks (from the Guardian article):

    At Goldman Sachs the figure was $11.4bn, Morgan Stanley $10.73bn, JP Morgan $6.53bn and Merrill Lynch $11.7bn.

    How much did the government just give GS and MS? 10 billion. This is just unf*ing believable. The government is funding the IBs’ bonuses and nobody gives a damn.

  2. doc holiday

    This is a visual metaphor for Abby Joseph Cohen and the fact that sleeping dogs must lie.

    RE: “Not all dogs dream equally. Research suggests that small dogs dream more than larger dogs. A Toy Poodle may dream once every ten minutes while a Golden Retriever may only dream once every 90 minutes. Dreaming also seems to occur more frequently in puppies. This may be because they are processing huge quantities of newly acquired experiences.

    What do dogs dream about? Since no dog has ever told anyone about a dream he’s had, we can only guess. It’s likely that dogs dream in a similar fashion to humans, replaying the everyday activities that make up their existence, like chasing, playing, and eating. If you’ve ever been tempted to wake your dog during a dream, try and resist. It’s best to “let sleeping dogs lie.” Dogs, like humans, need uninterrupted sleep for healthy mental activity.”

    Our Best Friends Do Have Dreams.

  3. Richard Kline

    That is a _BITCHIN’_ letter by Lahde. Wouldn’t we all love to write a swan-dropping song like that. Best of luck, pal, to your next better leg on life.

  4. Anonymous

    “Hedge fund manager slams ‘idiot’ bankers Financial Times. Andrew Ladhe exits with a very successful record and savages the industry. Read the full text of his final letter to investors.”

    The bulge bracket bankers weren’t idiotic. The BBBs knew exactly how risky their trades were for their clients and the public, but the BBBs did them in spite of that because it made them money. Given that Lahde was in the business for a fast buck and quick retirement, Lahde probably would have done the same thing as an efficient way to make quick money, and damn the consequences to shareholders, clients, or the public.

  5. Anonymous

    Buffett Interview on Charlie Rose

    I can’t believe how shamelessly Buffett promotes his “friend” Hank Paulson as a civil servant, and Paulson’s plan. Paulson is as corrupt as Joe Kennedy who was a corrupt schemer than insinuated his way into running the SEC. While Paulson was at Goldman, Paulson advocated letting the prime brokers increase leverage from 12 to 1, to 30 to 1. While Paulson was at Goldman, it fought the regulation of derivatives by the CFTC.

    Buffett says the Treasury should buy at fair market value, in order to make money. Paulson flatly admitted he wants to overpay for assets to help the banks. When Paulson flipped into having Treasury buy equity in banks, he bought on worse terms than the market, since he bought on worse terms than Buffett in GE/GS and the UK in UK banks.

    If the 111th Congress holds investigations into investment banks that are as wide ranging as the Pecora hearings during the great depression, people will see just how corrupt Paulson is.

  6. Anonymous

    ‘This is what happens when one is measured for a sarcophogus when one is still a growing puppy’.

  7. Moopheus

    So the banks are taking huge write-downs, huge losses, huge bailouts, and huge bonuses.

    So the first thing to do is send this article to every member of congress, esp. the ones who voted for the bailout. Everyone should print it out and mail it to Paulson. Not like he doesn’t know, of course.

    I mean, if the bankers are just paying themselves the money they just got from Treasury, then a targeted bank run should be organized against these banks. Anybody with money in these banks should withdraw it. Any investments, cash them out. Put your money in a local bank or credit union. Stop using your credit and debit cards; use cash instead. Clearly the only way to stop these bastards is to pull the plug on them. And let them know this is why.

  8. Anonymous

    The use of the 9/11 attack as a political weapon by both major political parties is old news.
    The political corruption in America has reached levels that will require something other then more of the same.

  9. Don

    "China is the future of the world," Zardari said"
    From the Washington Post:

    "Investors who helped build the financial boomtowns of developing countries in recent years are now fleeing them, threatening to destabilize burgeoning economies and drag the world into a deep recession…

    "There has been tremendous redistribution with the credit crunch. People are selling their higher risk assets — and emerging market equities qualify as higher risk," said Alec Young, international equity strategist for S&P Equity Research in New York."

    This is bad news. We're managing to take everyone with us.

    Check this out:

    "Perhaps the only major economy that remains robust despite the crisis is China…

    "China is the future of the world," Zardari said, according to the official state news agency. "A strong China means a strong Pakistan."

    I guess we know where Pakistan stands.

    By the way, thanks for the Guardian reference.

    Don the libertarian Democrat

  10. Economic Computer Games

    Mark to market is not perfect but it is the best way to determine the value of assets bar none. Anyways, changing it now will only cause the crisis to extend itself because everybody will know that any sudden revaluations of the books will look fake and undermine confidence in good and bad institutions. In the future we need regulation of all financial instruments, create counter-cyclical capital requirements for banks and try to convince Asian countries that should not hoard their dollar reserves but use them to create consumption during the coming recession. An easy way to do this would be to float their currency but because that is unlikely to happen, perhaps large scale infrastructure investment or tax credits can be used to pump their economies.

    Whatever we do, we are in the tank for at least 2 years. Three cheers to bargain hunting until then and selling when the markets return to a high in 2010! Hopefully this time it will be Asian led consumption and Western lead investment.

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