Links 5/15/10

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Australia hails Jessica Watson, 16, for sailing record BBC

China to Stop Spying on its People; Will Use Facebook Instead Andy Borowitz

Chris Jordan on Midway Atoll and the Great Pacific Garbage Patch New York Review of Books

Joe Stiglitz on Derivatives Reform and Section 716 Mike Konczal

The Treasury non-conundrum, or why yields are trading below 3.6% FT Alphaville

The Sarko Euro Rampage Leak and Maxi Euro Devaluations Ed Harrison

SP Futures Daily Chart Jesse

Doublethink billy blog

SEC Chief’s Big Bet on Goldman Wall Street Journal. A fine job of reporting.

S&P Cuts to Junk Mortgage Bonds It Rated AAA in 2009 Business Week

India’s Hindus take a shine to silver and Germans lead gold rush frenzy Financial Times

It’s baaack! Deus Ex Macchiato

NYT vs. NYT on the Big Fat Greek Question Columbia Journalism Review

They Have Made a Desert Paul Krugman

Obama Echoes George H.W. Bush On Oil Spill Response (VIDEO) Sam Stein, Huffington Post

Obama turns BP anger on regulators Financial Times. Contrast with Richard Kline, hoisted from comments:

And regarding the government MMS flagrantly violating established law on enviro assessment to cater slavishly to the oil industry, this, along with “Drill ’em all,” goes directly back to Barack Obama’s desk. It’s his Admin who gave _far_ more to the oil industry that the oil man he replaced. Bo Prez’s environmental cred was vanishingly thin before he ran for the Big White Palace, but we can forget about it now: he’s a corporate subsidiary, through and through. Oh he talks a little game, and will through a few ‘civil penalties’ around, easily and quitely settled after the reporters shuffle out of the chamber, so he has something to stump on in November, but he doesn’t give a damn about the public interest on the basis of how he runs the government’s shop.

Antidote du jour:

Bonus antidote: Baby moose in sprinkler (hat tip reader Mannwich)

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  1. Hubert

    “SEC Chief’s Big Bet on Goldman Wall Street Journal. A fine job of reporting”

    Disagree. This is a a typical WSJ story, maybe a little bit above average. Nothing really substantial in there.
    One typical “hard fact” comes at the end:
    “Meanwhile, morale is soaring at the SEC, staffers say. After a recent meeting on proposed rules with Ms. Schapiro, two regulatory lawyers walked into the hall and fist-bumped before getting on the elevator.”
    This is business reporting ?

    1. Yves Smith Post author


      Business reporting done as narrative is a well accepted genre in the US. It became legitimate with the book Barbarians at the Gate. Ira Ross Sorkin’s Too Big to Fail is a more recent example. They are all considered to be good journalism.

      I am pretty sure this story was not a plant, since the Administration is rather ham-handed in its image burnishment efforts (the Treasury, which has a lot more people who have been in and out of top corporate jobs than the SEC, could only come up with stuff like having Geithner visit grocery stores and be interviewed by Vogue). The interesting bit, between the lines, is that Mary Shapiro seems to have taken it upon herself to rehabilitate the SEC. That does NOT appear to have been why she was appointed; indeed, my politically savvy correspondents expected her to be a Do Nothing who’d do a better job of pretending to Do Something than most Do Nothings.

  2. attempter

    Re “It’s Baaaack”:

    As we already knew from the fraudulent reported “profits”, the “bonuses”, the golf junkets, the resurgence of luxury spending by banksters, the Bailout was never intended to tide the system over while the structural “abuses” were “reformed”, the way its flacks claimed. It was never intended to do that and it did not do that.

    The only goal it ever had was looting, plain and simple. The government of Bailout America simply stole trillions of dollars from the people and handed it over to criminal rackets for the racketeers to personally loot. That great capital crime continues, millions every day.

    So the resumption of RMBS securitization, while a milestone, is right smack in the middle of the path we’ve been travelling from day one.

    By now when I ask the question, “At long last, have you no sense of decency?”, I ask it of the people as a whole. How long will they consent to be the slaves of these gangs?

    Or is the case terminal?

    Re NYT vs. NYT:

    The TRUTH is that the first step toward fiscal and moral sanity would be to end all corporate welfare – the Bailout, the war, bloated weapons contracts, Big Ag subsidies, and the endless list beyond. The second is to restore rational, fair marginal tax rates. Only then would it be valid to consult whether social spending is excessive or is causing any fiscal problems.

    But no one at the NYT or pretty much anywhere else in the MSM is willing to speak the truth. On the contrary theirs is the corporatist agenda. That means lying. The kind of disputes detailed here is just squabbling over the exact wording of the fraud.

    As a matter of economics, it is simply not possible to close that gap entirely with tax increases on the rich, as Democratic liberals want so desperately to believe.

    I’d love to meet anyone who really wants to rationally tax the rich. “Democratic liberals”, of course, want no such thing. Here the WaPo is just feeding teabgger-type lies about Obama and the Dems’ “socialism”, when they’re all rightists.

    Krugman, meanwhile, says trimming health care costs would do a lot to improve the country’s long-term fiscal outlook. It’s not enough, of course, and he says “a moderate rise in taxes” is probably necessary, too.

    One of Krugman’s worst crimes was his notorious shilling for the health racket bailout bill which was carefully calculated to do nothing but rack up ever greater rents for the utterly parasitic health insurance racket (and for the drug racket as well). Cutting costs was never part of its intention, and will not be part of its effect.

    Anyone who wants to cut health care costs supports single-payer. So by definition anyone who supported this vile bill (let alone served as its number Pied Piper) doesn’t want to cut health care costs.

    Here’s one more example, from today’s NYT:

    This is by one Catherine Rampell, evidently the NYT’s stenographer for the IMF. Here’s the blurb:

    A report shows that the surging public debt in the wealthiest countries is driven mostly by huge declines in tax receipts as a result of a decline in economic activity.

    That’s quite a blurb. It does a lot of work. In just a few words it says government debt has nothing to do with bailouts and wars and weapons spending, corporate looting of public money in general. Deficits also have nothing to do with tax cuts for the rich. Nope, they’re the result of depleted tax revenues on account of the recession. (And implicitly, it agree with the likes of Jamie Dimon that the recession is just a force of nature that had no cause and is nobody’s fault. Hmm, I think Aristotle might want to have a word with these people about different kinds of causes, and which are more important. If one man punches out another and the victim hits his head as he falls, and people asked afterward, “What happened?”, both rationally and morally it would be a strange kind of answer to say “He fell and hit his head.”)

  3. LeeAnne

    Much as I agree that Obama is no change and that it i disappointing; a wake up call that dictatorship is here now and representative government survives as farce, he is only a tool.

    Previous administrations accelerated brazenly by Bush “great job Brownie” as the bodies still floated in the background GUTTED the safety net against corporate exploitation, rapaciousness and rule and are now emboldened with their success to accelerate the social security and medicare are the same problem we have to do away with meme.

    It is not helpful to keep pushing the OBAMA DID IT political agenda. A republican majority will be even worse.

    1. attempter

      At least when the Republicans have the majority there’s some resistance to the worst atrocities of a criminal war, the assault on civil liberties and the expansion of the imperial presidency. The Dems and the corporate liberals, vile as they all are, put up some resistance purely on partisan grounds.

      But when it’s the Dems themselves committing war crimes, further gutting habeas corpus, wanting to gut Miranda, etc. there’s no one at all to resist except a handful of disenfranchised fugitives who still care about freedom and humanity. But there’s very few of us by now.

      1. LeeAnne

        Good point about the Democrats being more useful as defensive reactionaries because they haven’t been at all useful in the majority against the Republican agenda. But it is the Republican agenda.

        I was objecting to the talking points approach to Republican partisanship on this blog of all places. It just isn’t true that Obama is worse than the Reagan/Bush neo con enterprise that preceded his administration. Or that it isn’t the Republican agenda.

    2. Richard Kline

      In one sense, the issue of present malgovernance is not Obama, but there is a pernicious illusion imbedded in support for the Democrats which needs to be dispelled; this is the larger point. “A Republican majority would be far worse.” By what standard? Both parties support the same policies on practically any issue of importance; the major differences are the visuals. Oil industry shamelessly promoted by government; check. War on distant indigenes at our convienence for no conceivable reason; check. Imprision suspects of the wrong ethnic group and class; check.

      Are there differences between the parties? Of course there are. Most of these differences are the result of a small, principled minority within the Democratic Party which receives no support from the major blocs within it which monopolize Congressional leadership and Presidential candidacies amongst their own. The Democrats have passed virtually no ‘progressive’ legislation of any kind even in distant memory, and performed only a spongiform defense of what prior, better leadership had enacted . . . sometimes prior _Republican_ leadership, be it said, in another incarnation to be sure. The Democrats can’t be counted on to do anything of substance, and this is the point. There is no substantive reason for anyone of ‘progressive views’ or social conscience to give them a vote or a dime. We don’t have great alternatives to them, but that is because that principled core within the party hasn’t deserted it, which has been their tactical mistake for twenty years and more. Don’t be confused by the principled effort of that minority into thinking that the powers in the Democratic Party will save us: they can’t sell us out fast enough, and the evidence is under our nose, not to speak of the Engulfing Blob off our southern coast.

      Progressives have to quit fooling themselves and decide to actually be folks of social conscience rather than dupes of hope and faith. Barack Obama has always been embedded deep in the latter milieu; any reasonable assessment of even his attenuated track record in elected office before his election to the Presidencey demonstrated that, and his actions since have amply proven out his evident leanings. Making excuses for his inexcusable behaviors is inefficacious. Don’t excuse him; expect him to perform, and in fact demand that of him.

      Obama isn’t ‘the problem;’ the problem is the belief that ‘our leaders’ will save us. Despite the demonstrated result through forty years that absolutely they will not if not pushed.

  4. Ronald

    Obama’s administration reaction to the news that oil was gushing at a rate closer to 500,000 gallons a day vs 5,000 was very Katrina-ish! Clearly this information was known and has been suppressed by both the White House and BP.

    1. MindTheGAAP

      “Obama’s administration reaction to the news that oil was gushing at a rate closer to 500,000 gallons a day vs 5,000 was very Katrina-ish! Clearly this information was known and has been suppressed by both the White House and BP.”

      Well, of course the rates are known, since it would be hard for BP to understand much without knowing that rate (and I’m sure they’ve got lots of instruments that should be able to provide the data).

      Why are they not being released, though? I can think of three options:

      1. Knowing these rates would reduce their competitive advantage. –>if this is the case, the BP executive clearly has no clue what kind of a scenario they are in

      2. For reasons of legal liability, BP would rather have “no answer” rather than a bad answer–>my guess is that the courts will assume the worst possible answer, so this would be a *very* stupid move on BP’s part

      3. BP is trying to delay the bad news–>anybody who has ever worked for an idiot management team knows that if you know you’re going to screw up big, you’re almost always better off telling the worst-possible scenario to customers once, and then beating that scenario. Apprising people of new, worse, figures every few days is about the stupidest and most short-sighted thing you can do.

      Maybe there are other factors, but I can’t think of them (then again, this isn’t my area of expertise)

      As a side-note, that 500k bpd seems like an unrealistically high figure–but again, this isn’t my field.

      1. MindTheGAAP

        (While I’m mumbling to myself anyway)

        If BP doesn’t become more forthcoming, there are going to be a hell of a lot of rumors that are going to fill that vacuum of information. Some very ugly ones are already being posted on theoildrum.

        You gotta wonder if they get any value for all the $ they dump into PR…

  5. Ronald

    Note this on CNN this morning that nothing is going to stop the gushing oil except the relief well which could take months to drill. Finally an admission of what’s ahead!!!!

    “Based on the scientific analysis of the EPA and (National Oceanic and Atmospheric Administration) and review by the National Response Team, it has been determined that the use of dispersants at the subsea source is the prudent and responsible action to take along with other tactics including surface dispersant, skimming, and controlled burns,” said Coast Guard Adm. Thad Allen, the national incident commander for the spill.
    Underwater use of dispersants could lessen the spill’s overall impact, but they’re not a “silver bullet,” EPA Administrator Lisa Jackson warned.
    “They are used to move us towards the lesser of two difficult environmental outcomes,” she said in a statement. “Until the flow of oil is stemmed, we must continue to take any responsible action that will reduce the impact of the spill, and that is what we are doing.”
    What are oil dispersants?
    BP said it planned another attempt Saturday to cap the leaking well. It will involve inserting a tube into the well’s ruptured pipe, collecting oil, then sending it to a vessel on the surface, said Mark Proegler, a BP spokesman.
    The company has lowered a smaller containment dome for use if the insertion tube does not stem the flow of oil into the water, Proegler said.
    Allen said the containment dome was the first choice, followed by the insertion tube.
    Neither procedure would be a permanent solution, Allen said Friday in Mississippi. Both “will reduce the leakage, not stop the leakage,” he said.
    The ultimate solution, Allen said, will be achieved by relief wells being drilled near the leak site. Those will take weeks, if not months, to complete, BP has said.

  6. Ronald

    The latest PR release:

    “Interior Secretary Ken Salazar said BP PLC had a problem Saturday with the latest effort to stop the leak, but was continuing its work at the ocean floor.

    “There was a problem. They had to reconfigure. They are back down again … trying to get it inserted,” he told reporters during a briefing at a bird rescue facility in Louisiana, declining to offer further information.

    BP has offered scant details of its progress in trying to thread the 6-inch tube into the 21-inch pipe spewing oil from the ocean floor. Company spokesmen said technicians are continuing the methodical work that began early Friday of using joysticks to guide the deep-sea robots that are manipulating the contraption. They wouldn’t elaborate on Salazar’s report.

    “We’ve never done such operations before and we need to take our time to get it right,” spokesman Jon Pack said in an e-mail Saturday after Salazar’s comments.”

  7. Sundog

    Cheers NC for calling more attention to Chris Jordan’s work.

    Trichet: …it is clear that since September 2008 we have been facing the most difficult situation since the Second World War — perhaps even since the First World War.

    (Finally someone in a position of responsibility is talking sense. That “we” is the EU; for the US I’d say the situation is rather more dire.)

    Der Spiegel interview with Jean-Claude Trichet,1518,694960,00.html

    Recent think tank events worth a listen:
    – Buiter on sovereign debt at CFR
    – Ferguson on imperial collapse at Peterson
    – Halper on China soft power at Cato
    – Ragan on economic fault lines at Carnegie Council

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