Orange County Register: End of the Rainbow Knight Science Journalism Tracker (hat tip reader Krishna)
Toyota Seeks To Shed U.S. Workers Forbes (hat tip reader Tim)
Congressional Offices Don’t Have the Stimulus Bill, Lobbyists Do Washington Whispers (hat tip reader Dwight) and Democratic Senator Predicts None of His Colleagues ‘Will Have the Chance’ to Read Final Stimulus Bill Before Vote CNS News In case you had any doubts about how our system works.
How We Can Restore Confidence Charles Munger, Washington Post
Why the U.S. Stimulus Package is Bound To Fail David Harvey (hat tip reader Anthony). Explains why, even if you are a die-hard Keynesian, the US will prove unable to mount an effective stimulus program.
How To Make TARP II Work Lucian Bebchuk
Eurozone slump worst in 50 years Financial Times
Bankers Face Strict New Pay Cap Wall Street Journal. I’m surprised the article dignifies the “oh, make the banks comply, and they’ll give the TARP money back.” Ahem. Now that Goldman and Morgan Stanley are bank holding companies, they are wildly out of compliance with regulatory capital requirements (investment bank, under SEC jurisdiction, were permitted much higher levels of gearing). And do you think any of the big bank recipients could give the dough back and not be in violation of regulatory requirements? And that’s before we get to what the newly vigilant rating agencies would do to them.
Morgan Stanley, Citigroup to Give Brokers Big Retention Fees Wall Street Journal. These bonuses are necessary to stop poaching. I’ve worked in countries with tough regulators, and this could be stopped in a nanosecond if the authorities here had any will. But on this and the issue above, clearly the regulators here are craven and/or corrupt.
Mortgage Subsidies – Arguably Useless But Definitely Expensive Tyler Durden. A very good analysis, and I have only one minor quibble. Durden contends that, for most types of stressed borrowers, principal reductions are more likely to succeed than payment reductions. Mortgage counsellors have been telling me the same thing for a year and a half. Durden argues that the improvement results from the borrower having more equity in the home. The mortgage counsellors tell me that payment reduction without principal reduction does not lead to enough of a change in the actual payments made to help borrowers enough (as in the shortfall is added in part or whole to the mortgage balance, and the borrower understands that, which means they expect payments to increase down the road). The mortgage counsellors contend that the cost of foreclosure (hard costs plus loss on sale) are so great that lenders can afford considerable principal reductions and still come out ahead.
Antidote du jour: