Gulf recipe: shrimp, crawfish, oil BBC
Annoyed by cellphones? Scientists explain why Reuters
Wild Birds Opt for Conventional Food Over Organic, Study Shows ScienceDaily. I’m not sure this proves what the article says it does. People and animals prefer all sorts of unhealthy treat food over what is good for them (hat tip reader John M)
Goldman Harvard Recruit Pledges to Do No Harm, Fights for Oath Bloomberg. This is well intentioned and completely lame. One of times a lot of Harvard Business School grads got bad press over ethical lapses (there have been so many times it has happened I can’t recall what set off this inquiry, but it might have been Enron and the 2002 accounting scandals), HBS looked into what it could do to improve the ethical conduct of its graduates. It concluded ethics could not be taught (at least to people old enough to be admitted) and the school therefore needed to change its admissions policies to select more upright people.
The last few years demonstrate how well that initiative worked.
EPA scolds BP in Gulf oil spill: dispersant is too toxic, change it Christian Science Monitor (hat tip reader Guest)
S&P 500 One Day Declines of 3% or More Bespoke Investment Group
Irish Miracle — or Mirage? Peter Boone and Simon Johnson, Economix
Lost Decade Looming? Paul Krugman
A big step towards fiscal federalism in Europe Romano Prodi, Financial Times
Top Tax Rate? Socialism Barry Ritholtz (hat tip reader John L)
Citigroup Didn’t Say Morgan Stanley Was Short in ‘Jackson’ CDO Bloomberg, While it is great to see more digging, these pure synthetic deals were a much smaller part of the total market than the heavily-synthetic trade devised by Magnetar and imitated by others (and exhibited the same conflict, that the CDO was designed to suit one party taking a sizeable short position). We’ve been told our tally is not yet complete (and we have found more deals than ProPublica) and we have yet to identify who else was in on that type
Naked Truth on Default Swaps Floyd Norris, New York Times
Grey areas in Chinese loans give pause for thought Gillian Tett, Financial Times. Tett is getting worried and compares China to subprime.
Merkel Does Mahathir and Martin Luther: Tilting the Market Table Dude, where’s the Dharma? (hat tip reader Ronald). This is very clever indeed.
City fears of ‘Great Depression Mark II’ Edmund Conway, Telegraph. Um, maybe they should have thought of that before going into “Mission Accomplished” mode in 2009.
What Does a Euro Depreciation Mean for the US? Menzie Chinn, Econbrowser
Don’t misread the trade implications of the euro crisis for China Michael Pettis
Rescue packages and iron boots billy blog
Antidote du jour:
That rat knows that in a normal probability distribution, this ends badly. So he’s hoping for a long tail outcome. As it were.
The rat, having jumped off a sinking ship, is now on the back of a cat.
The rat is us.
The sinking ship is deflation.
The cat is hyperinflation.
I read Krugman’s article, and comment because it touches on something my gut has been telling me for years: that the markets have been misreading the economy since the Berlin Wall went down. Since then, our markets have been seized with a euphoria which tended to ignore the fact that a major global economic re-ordering had yet to take definite shape.
So when people (on CNBC, mostly) tore their hair over the Dow dropping to 10K, I took a look at some historical charts of the Dow and S&P 500, and what did I find (again)?
That using historical rates of growth over time (and using a rule of thumb approach of somewhere around 10% annual growth in equities), the Dow would be just under 10K (up from about 8700 last year), just about where we are this morning before the opening.
This is about as rough and macro as it gets. It ignores everything else but historical prices, and doesn’t even use them well in a quantitative way, but my gut tells me that everyone tearing their hair over yesterday’s drop in equities act under the assumption that the bubble market reflected reality, which ignores some real adjustments in US markets relative to the global economy.
Over the long haul, you can’t beat the market (certainly my retirement funds never managed to). The only thing you can do is, if you find yourself ahead of the game, get out and take your money off the table.
If the market rebounds this morning (futures ave very slightly down as if now), as I believe it will, that would bother me.
EPA steps up, wow, a tiny glowing ember of competence. The thing that made Obama a key hire for the banks was his naiveté. Any grownup knew that this administration had to be urgently focused on IDA-style capacity building, just to compensate for the capacity demolition that’s been going on since maybe 1998. Obama starts out with a corrupt and incompetent government, and what does he do? He puts empty suit Salazar at interior, of all places. What he needs is ruthless economic hit men to chop heads and audit everything in sight. He’s shaping up to be next in a long line of abject, feckless failures that prove to us that government is shit.
But *why* is government shit? Is it because we just don’t have the “right people” in places of power? Or is it because if you put the right people (most intelligent, best qualified and knowledgeable) in places of power, given the incentives that naturally exist in a bureaucracy and human nature, it will still turn to shit?
Perhaps if government were totally restructured with different incentives, it would be competent to handle many of the functions it now attempts (poorly) to serve. But even then, corrupt people in the system will abuse it.
I’d like a heaping helping of smaller and more sharply focused government, please.
Everyone should have seen this massive fail coming when Obama started appointing all the Clinton-era retreads. Even Obama liked to repeat that aphorism about doing the same thing over and over and expecting a different result. The Bush economic/budget policy failed, so Obama put it on steroids.
But *why* is private industry shit? Is it because we just don’t have the “right people” in places of power? Or is it because if you put the right people (most intelligent, best qualified and knowledgeable) in places of power, given the incentives that naturally exist in a bureaucracy and human nature, it will still turn to shit?
Perhaps if private industry were totally restructured with different incentives, it would be competent to handle many of the functions it now attempts (poorly) to serve. But even then, corrupt people in the system will abuse it.
I’d like a heaping helping of smaller and more sharply focused private industry, please.
Exactly. Could not have said it better…
No, government is not shit, it’s just that kleptocrats know they can make it look bad by sticking venal hangers-on in sensitive positions. It’s all part of the program to discredit the one entity that could potentially respond to the popular will.
And so we were discussing, just the other day, what the libertarian response to the Seeping Blob that BP Wrought in the Gulf would be. Needn’t have bothered: An official Libertarian is speaking to the press directly on just that subject, as Rand Paul calls Obama “un-American” for “putting his boot on the throat of BP.”
. . . Just when I thought the November elections were going to be a dreary affair indeed, a flaming kook sets fire to himself and sprints out on the hustings. This could almost get interesting . . . .
Re: Wild birds.
Same goes for tamed birds too. Try to switch your parrot, parakeet or cockatiel from a conventional seed mix to a healthy Roudybush pellet diet for instance.
Oh la la! You will feel the wrath and discontent of your fav pets.
Oil plume nears West Florida Shelf fishing ground
Sarasota Herald Tribune May 21
A mass of water suspected to contain a subsurface mixture of oil and toxic chemical dispersants has already reached the outer edge of the West Florida shelf, according to a respected oceanographer. The report came Thursday evening from Mitchell Roffer, a biological oceanographer who has been tracking water masses as a private consultant since 1986.
please excuse the link to the Government global warming propaganda site but this is amazing (Note the feed connection is a bit unstable)
Oil Spill in the Gulf – Live Cam
BP Oil Spill Live Video Feed
If there was any doubt of similarities of the handling of the BP Gulf Oil Spill to the handling of Kartrina and to the rumors of a cover-up I think this headline provides a definitive answer. A full month after this tragedy began:
Federal task force assembled to measure volume of Gulf of Mexico oil spill
NOLA May 20, 2010, 7:20PM
Thanks for the link.
Really, you couldn’t make this stuff up. It is truly Orwellian.
In domestic abuse situations, it is not only the abuser that tries to downplay the abuse, but often the abused as well.
So we are left wondering if Lubchenco’s role here is that of the abuser, or of the abused.
When Lubchenco says “This is a time for awareness and preparation, not overreaction,” that is a statement that comes right out of the right-wing Republican playbook.
“The current flow rate estimate was derived from information gleaned from aerial photographs of the surface of the water, such as the size of the oil slick and its approximate thickness based on color,” Lubchenco admits. She says this knowing full well that massive quantities of dispersants have been injected at the source of the leak for the very purpose of preventing the oil from reaching the surface. And as Sylvia Earle of the National Geographic Society testified before congress, the dispersants are “more cosmetic than helpful.”
At the end of the day it matters little whether Lubchenco is in the role of abuser or abused. Her statements demonstrate a deliberate attempt to downplay the scope and gravity of the spill, and she has lost all credibility.
Meanwhile, videos like these pretty much demolish Lubchenco’s efforts to run interference for BP:
On the theme of rats… I thought this symbolism very apropo!
Rodent scurries by as Obama lauds Wall Street vote http://news.yahoo.com/s/ap/20100521/ap_on_re_us/us_obama_rodent
Reading the Bloomberg article about taking an oath at Harvard Business School…
“Created last year by Harvard Business students to counter a growing public mistrust of business, the oath is being championed by Nitin Nohria, the newly appointed dean of the school.”
Obviously Nohria did not read “Predictably Irrational” by Dan Ariely. Of course, that may have something to do with the fact that he’s an MIT prof and doing real economics experiments and not simply stuffily spouting economic theology ;)
Ariely sums up the result of his experiments related to dishonesty in Chap 11. Here is what he has to say about professional oaths (p.213-214):
“Will such general measures work? Let’s remember that lawyers do take an oath when they are admitted to the bar, as doctors take an oath when admitted to their profession. But occasional swearing of oaths and occasional statements of adherence to rules are not enough. From our experiments, it is clear that oaths and rules must be recalled at, or just before, the moment of temptation. Also, what is more, time is working against us as we try to curb this problem. I said in Chpater 4 that when social norms collide with market norms, the social norms go away and the market norms stay. Even if the analogy is not exact, honesty offers a related lesson: once professional ethics (the social norms) have declined, getting them back won’t be easy.”
God what monstrously trite bullshit that is. And they call themselves “thought leaders”. Ha ha ha ha hahahah hagha.
Another dump of “M”ostly “B”eers & “A”lcohol zombies onto the Great Plains of the Public Grasslands to go hunt the big buffalo. Yeah!
Shit. The moment somebody wiggles a bonus or a lap dancer’s tit in their scrubbed little faces that oath will be rationalized away then quickly forgotten in the grip of some new mania of the moment that involves profiting from somebody else’s loss. ha ha ha.
God save us from these lightweight dimwits. It’s so unfortunate that society buys into their little diploma mill and lets them get behind the wheel. An elightened world would let librarians run things and lock these clowns up in a Club Med resort somewhere where they can screw each other and leave the public purse alone. booowwhaha ahahahaha haahahah
“God what monstrously trite bullshit that is. And they call themselves “thought leaders”.”
good point craazyman!
i listened to a discussion about corporate responsibility in a german university last week. a partner of ernst&young talked about how they were checking sustainability reports from other companies and a lady from the allianz talked about corporate volunteering and microfinance.
well that is how they mainly see there corporate responsibility!
what they didn’t talk about by themselves were there behaviour in the current crisis, e.g. E&Y and their connections with Lehman.
in my eyes there is no real thinking about responsibility within the leadership of these companies and i doubt it that a HBS ethics oath will change anything!
for sustainable changes we need more people who ask serious questions and challenge the staus quo … but look at the people and criteria after which a lot of big companies, central banks, government agencies and also universities recruit their staff!(at least in germany)
i think we need some deeper changes in the way duncan foley describes it
Well, the optics on this one certainly don’t look good.
President Obama Delivers Remarks on Financial Reform and Wall Street (Yahoo! News)
Would Patrick Henry please pick up the courtesy phone, Patrick Henry, the courtesy phone.
James Cagney springs more to mind than Patrick Henry, which I had to go and look up… thanks for the history reminder!
on a lighter note…
Teenage mutant ninja turtle Michelangelo does a James Cagney impression
The guy who writes this blog makes some amazingly insightful observations.
The truth is that it matters little whether you call it Ordoliberalism or Neoliberalism, the Freiburg School or the Austrian-libertarian school, the end result is that it’s all the same: neo-imperialism.
And they never really parked the gunboats, despite all the Orwellian claims about “liberty” and “freedom.” The only difference between the old imperialism and the new is that the iron fist now comes veiled by the “rule of law” and “property rights.”
Pompous, self-righteous piety has forever been the hallmark of imperialism, and it manifests itself in spades in the new imperialism.
Yes, American imperialism is not spoken in polite company.
As a mainstay of the US economy it speaks volumes that the American empire and its imperialistic policies and actions are NEVER discussed by “real” economists.
Yes, American imperialism is not spoken in polite company.
… probably part of the reason libertarians, especially of the Ron Paul variety, are usually not included in such company.
I like the Johnson/Boone Ireland article, but wow, the false dichotomy is really my pet peeve.
Is it possible, just a little bit possible, that there is a middle ground between miracle and mirage?
They do realize that there are lots of tax havens in the world, right? Maybe Ireland’s status as a tax haven is not the only factor that led to its growth when many other tax havens did not experience the same level of growth over the last 30 years? Maybe the difference between tax havens who grew wildly and those that did not was that those who succeeded had a well-educated, English-speaking population?
The rest of the article is quite good, however, especially about the nationalization of bank debt. Too bad it is sullied by the simplistic analysis of the economic history of the last few decades.
“But *why* is government shit? Is it because we just don’t have the “right people” in places of power? Or is it because if you put the right people (most intelligent, best qualified and knowledgeable) in places of power, given the incentives that naturally exist in a bureaucracy and human nature, it will still turn to shit?”
There is a great variation in what governments do between time (just open any book on history), and also across geography. This wouldn’t be the case if just participating in a government somehow corrupted a person. The idea of all governments being shit masks the difference between the two Koreas, for example.
It really does matter who the personnel are. Things like elections and civil service rules are really personnel staffing systems, and they can definitely do a good or poor job at that.
Just read chapter one of your book, loving it thus far about the number of illusions economists and govts put themselves under so that the world makes sense to them, instead of the other way around.
let’s see what’s next hehehe…
one thing though… you could’ve smiled for the photograph on the book jacket; you look pretty glum, as if you just crapped a bad one.
good stuff nonetheless!
trade implications on a downhill rail to a brick wall, with a cliff on the other side:
Children are like martians, with all kinds of imagination. What they need is a simple map to give them the lay of the land, so they can start building momentum. Instead, we throw all kinds of misdirection at them, until we have destroyed all their imagination with confusion, so they will travel in the same worn ruts we travelled across, to ensure that we are out in front, and they are following behind, carrying our baggage. Love all the admonishments that boil down to “ we put up with stupidity, what’s wrong with you”, when they want to explore a different path, like a bunch of cattle in a pen, waiting for the next feeding, getting mad and jealous when one of the calves breaks out.
Then when the kids want to go down a path we know will result in failure, we tell them to go ahead, knowing that they will back shortly, dejected, so we can tell them “we told you so”. The enterprise architects are on that path, watching adult after adult survey their own limitations, waiting for a kid that has survived the imagination gauntlet. Some kids will start building a bridge to get over the obstacle, and will naturally look around for tools in the environment, finding none, because the adults have taken all the artifacts back. The kids with imagination will look around for materials to fashion tools, to build the bridge, just to take a look on the other side.
The rabbit “thinks” it knows where it is going, talks the rest of the critters to follow along, and depends on speed to hide its ignorance, changing the story at every turn (Mel Blanc, Mr. Rogers, & Cpt. Kangaroo). That exhausted rabbit is now turning to see a lost and angry mob, realizing that all the talented kids with imagination have disappeared. The rabbit teaches the kids to lie by example, and then waits to punish them when they lie, creating rules to which he is exempt, and blaming them for outcomes, with debt.
So, the flash crash was legitimate, and the people that bet correctly, supplying necessary information to the market, had their orders voided. What was that bond guy saying, “short sellers provide no value to the market?” Never saw that coming.
A blue chip multi-national is listed at $62, on earnings derived from job devolution, poisoning the environment, and reincorporation of the strict social class system. A short seller bets 1 cent. What’s the real market price?
Watch out for turtles; they are slow on land, but they can swim across the ocean and operate at depths far beyond anything endurable by the rabbit, which is looking for volunteers, at $10/hr. A month, and they can’t find one person in 7 billion to cut off the flow. Where is that newly rolled out Fortune 500 submersible program?
… and the rabbit says “the bottom is in, and we are still confident in the bricks; looks like a low-risk entry point to me,” with a shovel in hands and an ipod in his ear. Can’t imagine where Dodd is going to float up next.
How can you identify a politician in a failed regime? He has his mouth open and garbage is coming out. How can you identify the cattle? They are surrounding the politician, eating the garbage, and nodding in approval when the escaped kids are proclaimed non-persons. It doesn’t take a lot of imagination to wish people away, but it’s the clicking the heels that trips them into their own garbage.
Cannot believe it (not), the guy says in one breath, “I like the Canadian banks, the drop in oil prices is bullish, they just have a better system.” What’s the contract price for shale oil, what’s the median price for a home in Vancouver, and what does China have to do with both?
Keep the stimulus drugs coming; we need to keep that price above $65/barrel. The VAT will solve everything though; it’s a better system, just ask the Canadians being priced/taxed out of their homes. What were the numbers on Canadian consumer sentiment again?
Eh? (that’s not really Canadian by the way. Its use is quite limited, largely around economies operated by American multi-nationals in southern Ontario. Other slave sub-economies are less sanguine.)
Can you believe that crap Frank was shoveling out? A market rally heading into a meeting to determine financial implementation … with Obama, Dodd, & Frank … “we got rid of the panic and now we need to deal with the stress” … right … from the talking head.
Might want to think about real prices, private community mortgages / rents, and productive capacity. A 4% loan on a house listed at 3x its real value, with a requirement to maintain an empire-approved job is not a deal.
It’s not about renting economic slave jobs; it’s about liberty to earn equity in a real economy. That requires a some imagination, and a lot of sweat, neither of which are available in a ponzi market.
Congrats on all the recent attention as the MSM seems to be catching on that there is much truth and reality to be found in the blog space.
While this is extremely flattering, please “Stay the person you are”
Junk food preference is also found among bears (see Bear Attacks by Stephen Herrero) and probably many other species because of the body’s positive response to more easily digestible processed foods and to presence of naturally rare nutrients that the body craves.
It’s got electrolytes.
They are starting to turn on Obama vis a vis the BP oil spill