Links 8/10/09

Vast expanses of Arctic melting fast Raw Story (hat tip reader John Doe)

Scientists get closer to understanding ‘freak waves’ BBC

The Recovery Edges Forward Tim Duy. I have a lot of respect for Duy, but the optimism is based on the jobs report, and I’ve seen some analyses that point to statistical anomalies, that led, for instance, to a 20,000 increase in auto workers. In addition, a lot oj the reduction in losses appears directly related to the stimulus, short term :”make work” shovel ready programs, like paving roads. These aren’t high quality, self-sustaining jobs. They are more like temp work in another guise, If the temp work continues, great, but the point is the fact set differs in some material respects to past downturns, on which this “job losses stabilizing is harbinger of recovery” meme originates.

How the White House’s Deal With Big Pharma Undermines Democracy Robert Reich

A bad week for China’s facts and figures Gwen Robinson, FT Alphaville

Crisis and climate force supply chain shift Financial Times, This is a very big deal.

Effort to Rein in Pay on Wall Street Hits New Hurdle New York Times

Ten pointers on how to think like a German Ralph Atkins, Financial Times

Dancing near the door Tim Price

Antidote du jour. How I feel these days:

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  1. attempter

    The NYT piece illustrates two structural problems, each of which makes it impossible to reform pay processes under these conditions.

    In both ways alleged "reformers" cripple themselves from the outset.

    1. Restricting the pay purview to only the banks and companies that got de jure bailouts (the TARP).

    This is wrong because (A) the TARP is only a small portion of the bailouts, subsidies, loan guarantees, low- or zero-interest loans and all the other goodies that alot more than just a handful of banks got; the whole industry benefits from federal largess.

    (B) If the problem is the pay scheme in itself, why would it make a difference that one bank using that scheme got a handout and another didn't? To limit this to TARP recipients is saying the problem is not the "bonus" structure as such, but only if you perform poorly while using it.

    But if this pay scheme is intrinsically pernicious, then its badness is independent of particular success or failures. It would need to be eradicated across the board. That they're not trying to do this displays either their myopia or their bad faith.

    2. More broadly, the examples listed in the article are all the same. It's the same antisocial gamblers running and betting in the same antisocial casino. They are all parasites who produce zero social value but plenty of social risk, and often destruction.

    So the obviously needed reform is to do away with the sector "casino capitalism" completely. The pay scheme is only a subissue of the real issue.

    So if, out of ideology or cowardice or stupidity they refuse to deal with the real problem; if they concede in principle that these psychopathic gamblers have a right to exist at all, then of course they're not going to be able to regulate pay.

    Once you've already given up 99% of the game how do you coherently argue that the remaining 1% is an outrage? That's why they're reduced to whining about the cosmetics of it, "we've done so much for you bankers and traders, won't you please, out of the goodness or tact of your hearts, give us a political break here?"

    But as I said in yesterday's comment, the banksters are pretty much congenitally incapable of hearing or understanding even the politics of this.

    They are existentially incorrigible.

  2. Glen

    That's the difference between the FT Alpha journalists and Australian reporters. Australian reporters (I wouldn't call them journalists as journos investigate), especially those at The Australian and their "analyst" cheersquads, get into a lather on every bit of data out of wonder economy that is China. There is only scant questioning commentary and it's usually buried deep within some obscure part of the paper that no one reads so it's refreshing to read articles and visit sites such as this that back commentary with fact.

  3. Dave Raithel

    Existentially incorrigible indeed. I also accept that whatever reforms are adopted have to fit within some kind of recognizable "bourgeois" template. Here's a loose idea by reference to charitable organizations and non-profits: Their salaries and costs are measured relative to their fund-raising and operations, such that legitimate and illegitimate organizations can be sorted. Has anyone looked at compensation rates for finance people relative to compensation rates for other "for profit" enterprises? What if the share of revenue going to finance people is significantly different from what other managers/execs/white collars get in for profit businesses? Then a reform might be this: The total compensation package in the X finance firm/bank whathaveyou will not exceed Y% of revenues – split it up however ya want, that's YOUR problem….


  4. autodidact

    Arctic Sea Ice extent graph from the National Snow and Ice Data Center.

    As can be seen, the sea ice is below the average level for 1979-2000, but an increase from 2007.

    You can find longer series of data, but it is more instructive to include the Southern Hemisphere. All in all, there is no precipitous decline in polar sea ice, as is demonstrated by the data.

    As you can see, in the Antarctic, sea ice is above the mean, and appears to be on an upward trend.

    So, who you gonna believe, the people running around screaming with their hair on fire, or your own lying eyes?

  5. autodidact

    Sorry, the URLs did not transfer properly in my previous comment. You'll have to google the data on your own. What, is this a conspiracy? :)

  6. emca

    Here's the full version of the quote "dancing near the door" from John Kenneth Galbraith's article:

    "There is a phrase often used in dealing rooms (at least it used to be): enjoy the party, but dance near the door."

    The question raised is, has saving finance really saved the broader economy? Or if you can borrow money for nothing, is it that hard to be profitable, particularly if there's no requirement you fess-up to your own loses via bad gambles or have to re-loan to those 'deadbeats' down the line?

    Knowing when to enter a party has often been touted as indicative of a savvy investor, but maybe its more staying close to the door that's the cutting edge in troubled times. To put it another way, that current market rallies appear to be funded by short-term gains, better-than-bad, and quick turn-over (or even worse, bets on failure), does not give confidence to rosier assessments of the future.

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