Links 5/6/11

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Chimpanzees’ 66 gestures revealed BBC

Congress Gets In 12 Solid Hours Of Gridlocking Before Calling It A Day The Onion (hat tip reader Valissa)

Nearly half of people in Detroit cannot read Daily Mail (hat tip reader May S)

Report Instruction regarding Improvement of the working environment inside the reactor building of Unit 1, Fukushima Daiichi Nuclear Power Station Tepco

Probe Eyes Trades by Fund Titan Wall Street Journal. One of my contacts said nearly two months ago that Cohen was the target.

AIG Profit Falls 85% to $269 Million on Quakes, Bailout Costs Bloomberg. Wonder what this does for the stock sale timetable (which I recall dimly had been for May).

What does Jim Rogers think about the silver crash? Ed Harrison

Commodity Corrections Rajiv Sethi

Restaurants Lift Prices as Inflation Hawks See Fed Behind Curve Bloomberg

Why ETFs give an uneasy sense of déjà vu Gillian Tett, Financial Times

Judge Allows Redlining Suits to Proceed New York Times. Note they are against the uber sanctimonious Wells Fargo.

The row over Iowa AG Tom Miller’s campaign donations continues: Tom Miller: I’m committed to consumers, not big banks Des Moines Register v. Iowa CCI stands by position on Miller campaign contributions

Heroic Registers of Deeds Battling Mortgage Fraud Dave Dayen, FireDogLake

Closings canceled on some bank-owned homes after court rules against MERS Detroit Free Press (hat tip Lisa Epstein)

Antidote du jour. This is Skippy’s cat:


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  1. financial matters

    A few contributions from Project Syndicate…

    Looks like some important changes in IMF policy…

    The IMF’s Switch in Time
    Joseph E. Stiglitz

    But an even more important change is the link that the IMF has finally drawn between inequality and instability.

    The crisis has also put to the test long-standing dogmas that blame labor-market rigidity for unemployment, because countries with more flexible wages, like the US, have fared worse than northern European economies, including Germany. Indeed, as wages weaken, workers will find it even more difficult to pay back what they owe, and problems in the housing market will become worse. Consumption will remain restrained, while strong and sustainable recovery cannot be based on another debt-fueled bubble.

    “Ultimately, employment and equity are building blocks of economic stability and prosperity, of political stability and peace. This goes to the heart of the IMF’s mandate. It must be placed at the heart of the policy agenda.


    The Global Economy’s Corporate Crime Wave
    Jeffrey D. Sachs

    Given the close connections of wealth and power with the law, reining in corporate crime will be an enormous struggle. Fortunately, the rapid and pervasive flow of information nowadays could act as a kind of deterrent or disinfectant. Corruption thrives in the dark, yet more information than ever comes to light via email and blogs, as well as Facebook, Twitter, and other social networks.

    We will also need a new kind of politician leading a new kind of political campaign, one based on free online media rather than paid media. When politicians can emancipate themselves from corporate donations, they will regain the ability to control corporate abuses.

    Moreover, we will need to light the dark corners of international finance, especially tax havens like the Cayman Islands and secretive Swiss banks. Tax evasion, kickbacks, illegal payments, bribes, and other illegal transactions flow through these accounts. The wealth, power, and illegality enabled by this hidden system are now so vast as to threaten the global economy’s legitimacy, especially at a time of unprecedented income inequality and large budget deficits, owing to governments’ inability politically – and sometimes even operationally – to impose taxes on the wealthy.

    1. Philip Pilkington

      Wow… Jeff Sachs has really been doing his rosary over the past few years, hasn’t he? I think we should all be good Christians and accept this penitent into the flock.

    2. DownSouth

      While Sachs is definitely on to something there, I think the importance of the internet could go well beyond the mere transmission of information. This became evident from the comment thread from a post of Yves’ from a couple of days ago, On Trolls and Plants.

      The internet provides a space for something that is very important in the Western tradition: dialectic. Dialogue, in Western civilization, is how we search for truth.

      Those who disdain dialogue, and there were plenty of commenters on that thread who do, are reminiscent of Saint-Just, Robespierre and the Jacobin government’s great fear of the popular manifestations of government. They saw the popular sections and societies that sprang up during the French Revolution as a threat to their power, and immediately moved to emasculate and pervert them. For, as Hannah Arendt pointed out in On Revolution,

      while the Revolution taught the men in prominence a lesson of happiness, it apparently taught the people a first lesson in ‘the notion and taste of public liberty’. An enormous appetite for debate, for instruction, for mutual enlightenment and exchange of opinion, even if all these were to remain without immediate consequence on those in power, developed in the sections and societies; and when, by fiat from above, the people in the sections were made only to listen to party speeches and to obey, they simply ceased to show up.

      I’m sure the defenders of the status quo, hiding behind their mask of intellectual arrogance, would far rather us have a steady diet of what passes for dialogue these days: the highly choreographed drama between the Republicans and Democrats that is not dialectic, but a sort of burlesque or spectacle similar to what we see in professional wrestling.

      1. Francois T

        “Robespierre and the Jacobin government’s great fear of the popular manifestations of government”

        So great was their fear that they instituted a program of violent repression that quickly became known as “La Terreur”.

        An agent who was mandated by the regime to implement the program was known as Un Terroriste.

        And yes! This is the historical origin of the word.

    3. Chauncey Gardiner

      Thank you for this piece about Mr Sachs. I am impressed by an apparent shift in thinking by a brilliant man. How many of us could or would do the same?

      My own thoughts:

      The Fed’s owners and other elements of the kleptocracy have run the table on We the People through globalization, debt and a brilliant ongoing criminal scheme.

      I have seen little discussion of structural changes that might serve to reduce corruption, restore the power of democracy to We the People, and reduce the political power of those who control large banks and corporations. Accordingly, here are some thoughts for consideration. The country and the world have changed a bit since Colonial days. I recognize that any proposed “solutions” have flaws, and that perceived benefits must outweigh the risks and costs, including possibly perverse results.

      1.) Rather than engaging in perpetual redistricting and gerrymandering tactics, increase the number of the House of Representatives to 6,200 members (one for each 50,000 people), with local residency required of representatives within their districts for nine months of each year. With the ease and speed of communications afforded by the internet and video conferencing, I believe there is little need for representatives to reside in DC. I believe this step could serve to reduce the access and influence of money on legislation and regulatory oversight through both dilution of the power of corporations and their lobbyists’ campaign contributions and that of the two major political parties. Additionally, I am resurrecting the long-standing arguments in favor of term limits on members of Congress.

      2.) Increase the number of senators for each state tenfold. Ditto the local residency requirement and term limits.

      3.) Take all War Powers away from the executive branch and restore that power to Congress. In addition to the existing presidential term limit, require presidential election be held on vote of “No Confidence” by a majority of both houses of Congress.

      4.) Increase the number of Supreme Court justices to 31. Impose term limit on justices of six years. Require position of Chief Justice be temporary, with appointment through election by majority of peers on the Court.

      5.) Nationalize the Fed. Double the number of FOMC members. Fed Chairmanship to be limited to a single term of six years. Increase the number of “Primary Dealers”.

      6.) Impose limits on concentration of ownership of communications media.

      7.) Reinstate the Glass-Steagall Act. Break up the TBTF financial institutions so that they are not TBTF. Impose stringent limits on creation of or trading in derivatives by federally insured financial institutions and those that are deemed systemically too important to fail.

    1. rjs

      btw, in the 70s, indiana state published a tome on animal communication…even lizards have head bobbing movements that communicate basic emotions in a manner the chimps do…

    2. kevin de bruxelles

      Yglesias bravely calls for more testing to solve the problem of inner city illiteracy! That’s what’s called punting and what passes for the Left have been doing the same thing for forty years now on inner city issues.

      I typically like to deemphasize race in favour of social class but we have here a case where this approach would fail miserably.

      Typically when a small culture (or phenotype) joins a much larger and differing society, the two groups are impacted proportionally to their size, kind of like masses in Newton’s theory of gravitation. What this means is that the immigrating culture radically adapts towards the new and larger culture while in reaction the larger culture also absorbs some elements of the immigrating culture. During my childhood in California my friends whose parents were Mexican adapted almost 98% to American culture while the people whose parents were American adapted by having piñatas at our birthday parties and my mom started regularly making things she called tacos — which I quite liked but learned later were but pale imitations of the real thing!

      Over the past several centuries, when blacks came to Europe, much like a drop of black dripped into a pail of white paint, they all got mixed up and interbred and before you knew it that black drop was absorbed into a ever so slightly grayer mass. This is why until recently, outside of the negritude movement, there has not really been a “black” culture in Europe.

      The current population of African Americans in the US is around 12%. Given the one drop rule and obvious racial mixing I would guess we could reduce this by 2/3’s and say that 8% of the human phenotype is of African decent. Most Africans came to American two to three hundred years ago and in any natural environment this small percentage would have been absorbed into the larger phenotype pool generations ago so that it would be rare for anyone to be strongly recognizably of African descent. And in a natural environment nothing approaching black culture would have ever been possible.

      But the last two to three hundred years of race relations in America were anything but natural. A system of artificial selection was created to ensure the separation of the races. Not only did this mean that the tiny drop of the African phenotype would survive intact generations longer than it should have in the much larger pail of the European-American phenotype. But most damaging of all was that a separate “black” culture arose. This culture with many pathological aspects reflected the oppression and dysfunctional larger racist American culture from within which it was forged. Among the main tenets of black cutlure are short future time and a strong current of anti-intellectualism.

      The gradual diminution of racism that began with the Civil Rights movement in the 60’s has launched a very gradual process of reduction of “black” culture, certainly among middle class and above decedents of Africans. But the idea of relinquishing black culture is heretical to many in the black community today, who paradoxically cling on to the cultural fruits of racism like an Apache elder refusing to give up the comfort of his small pox-infected blanket. Almost everyone accepts that separate but equal accommodations are unacceptable but at the same time people accept a separate and very unequal culture.

      So there will be no improvement in Detroit until the people there abandon that enduring legacy of racism — black culture — and especially its short future time and the anti-intellectual aspects. Which is not to day all black culture is bad. Most popular musical innovations during the 20th century can be traced back to black America. Mick Jagger would have been a City banker and Jimmy Page a country physician if black culture had not existed. But despite these tragic losses, without black culture, bright inner city children would not be accused of “acting white” if they dared to read a book or speak correct English.

      On a recent trip back to California I had a long conversation with a guy (a conservative no less) who was very involved in the inner city charter school movement. After he gave me his storyline about how they were making progress I just came right out and said that short of creating boarding schools / orphanages that would separate the children from their pathological cultural backgrounds that the most they could hope for was just saving a small percentage of exceptional children. Amazingly he agreed with me and said that despite their conservative distrust of the state, they had come to more or less the same conclusion.

      Cultural revolutions and social engineering are messy. But short of these extreme measures there will be only the smallest incremental improvements with the US inner cities.

      1. Philip Pilkington

        “Cultural revolutions and social engineering are messy. But short of these extreme measures there will be only the smallest incremental improvements with the US inner cities.”

        How about a good old fashioned rise in income and housing standards? I hear it does wonders for the self-esteem to not live in a shithole and feed your family on food-stamps… But then, maybe I’m oversimplifying…

        1. Jimbo

          We can start by banning all fast food restaurants in zip codes below the median income. Also, ensure that certain households can’t have access to television. And compulsory exercise. You want a cultural revolution in certain areas. I’ll give you one.

          1. Poseur

            Compulsory exercise?

            Let’s put drill sargeants into everyone’s home starting with Jimbo’s! Ok, Jimbo, drop and give me 1000 pushups. No, not those sissy pushups you pissant! Pushups using only one pinky like real men do.

    3. Lurker

      Yglesias makes me want to vomit. I can’t believe anyone takes him seriously.

      No, 50% of adults in Detroit are not illiterate. And no, more testing doesn’t mean more education or more literacy.

      Seriously, this attack on teachers is utterly revolting. If you just fed and housed the homeless kids in the U.S. you’d see literacy rates rise substantially.

    4. Mike

      the link is bad. There’s an extra space in front of “news” and in front of “half.” If you delete those, the URL works.

  2. Philip Pilkington

    Trichet has denied that the ECB ‘betrayed’ the Irish government — as former finance minister Brian ‘mushy-brain’ Lenihan has claimed:

    I know this seems sort of like a local political issue, but I think that people should start paying more attention to this sort of thing. When commentators say that the Euro might fall apart in the coming years, they never really point to how this might occur. In my opinion it wouldn’t be an economic so much as a political shift.

    The key to the Euro falling apart is the monetary union becoming politically discredited in the eyes of mainstream politicians — as is happening quite explicitly, for example, in Finland at the moment. In countries like Ireland stories about ‘betrayal’ are particularly important. Imagine the impact these kind of accusations have on the new government — the Euroboys look more and more like dodgy types not to be trusted.

    So, yeah… keep an eye on this stuff. This, I think, is where the tornado is truly taking shape. It’s these kind of stories that are going to prepare the European political class to take action when economic circumstances become unbearable in the coming months and years.

    Oh, and speaking of the Eurocrisis, I thought the woman in this video was a bit of a legend. She starts talking about how the EU are going to ensure that the Portuguese will lose all their clothes and have to walk around with leaves on:

    1. DownSouth


      Great stuff.

      I see a storm brewing too. The tectonic plates are preparing for a shift, maybe like not’s been seen for 500 years.

      1. Jimbo

        Speaking of tectonic plates, I have a question for geologists. Let’s say a two-mile high glacier seared into Manhattan and remained there for 5K years. As it receded, and civilization returned, would there be any indication of the civilization that once flourished on the island?

  3. DownSouth

    Re: “Commodity Corrections” Rajiv Sethi

    Given the powerful role of expectations and sentiment in building and sustaining coalitions of long (or on occasion short) investors and hedgers, there does not really have to be a rational cause for the market to turn on its tail….

    ….the presence of non-fundamental volatility in speculative asset prices is important to consider in the execution of monetary policy.

    I think R2D2 of Star Wars fame gives a pretty good heads up on what will be the response of Bernanke and the Fed to Sethis’s and Kemp’s analysis:


    1. Dan Duncan

      Somewhere out there “in a place far, far way”…is a hard-core, but “celibate” Star Wars Fan Club Member. [He spent the past two decades, dateless, but it was “by choice.”]

      He’s sitting in his mother’s basement, rocking his estrogen-repelling Skywalker-Desert-Gear and he’s reaching for the Light-Saber attached to his hip and The Force is definitely with him….

      For you have insulted the legion of Jedi Knight engineers, confusing R2D2 (a technological miracle in the form of a astromech droid!) with the Robot from Lost in Space (that was nothing but a crude Class M-3 Model, General Utility Non-Theorizing Environmental Control Robot)!

      C’mon. “Use The Force, DownSouth…”

      1. craazyman

        I had a crush on Penny Robinson back in those days. She seemed so together. The blonde was way too old for me and she was Don’s woman anyway. ha ha.

        @ Gillian Tett’s ETFs
        There’s a link in that story to another article she wrote, about the VIX-based ETNs, and she writes there . . .

        “Now, in theory, this could potentially be very beneficial for the market. After all, the more liquidity that exists in any product, the more accurate prices are likely to be and the smoother any adjustments.”

        How can she write something like this? Is it true that the more beers you have the more fun you are? To a point, yes. But after about 7 or 8 things get too loose and crazy, heading downhill, possibly for the spins and the bathroom. I think the same is true with liquidity.

        And how can you determine how accurate prices are anyway. Isn’t that a “normative” judgment. Yeah I remember the textbook. ugh. and anywat That’s an internally contradictory theological tautology. An accurate price is what the market says, say the market priests, and if liquidity isn’t coming in to the market, then that’s part of the market. How can God be fallible? What is God, some chump who can’t count?

        They are all possessed. Even Ms. Tett, but she doesn’t even know it. They’re perfectly possessed. If you could stand outside of space/time and see what they look like in this state of possession, I’m sure it would look weird. Probably you’d see tiny jewel-like insects that look like they’ve been carved from obsidian crawling on the outer edge of the soul sphere. If they knew, they’d spray themselves with RAID. I don’t think these are demons, per se. But they are probably part of that ecosystem. I’ve seen these before, usually on the border of sleep. There was a spider that was so mathematically symetrical I couldn’t believe it, and it crawled down a thread right above the pillow of my bed working it’s angled legs in strange harmonies of movement, and as I stared at it in wonder and incredulity, it vanished completely. There have been other situations with other insect types too. It kind of freaked me out. These energy animals must have some purpose. Though it’s hard to know just what it would be.

  4. Sock Puppet

    Cancer screening: More on the prostate biopsy industry, this from Bloomberg:

    As a background, the PSA screening test routinely done in the US on men over 50 produces a lot of false negatives and results in a lot of unnecessary (but very profitable) biopsies. There is scant evidence that this regime does anything to reduce the death rate from prostate cancer. A reminder that in a for profit healthcare system, profit comes before healthcare.

    1. Jimbo

      A few years ago I recall hearing that almost 90% of soldiers who died in a war (don’t remember which one) had prostate cancer. I’m convinced that almost every man will come down with prostate cancer, but very few will die from it.

  5. financial matters

    Heroic Registers of Deeds Battling Mortgage Fraud Dave Dayen, FireDogLake

    “””Thigpen basically sees the catastrophe ahead, if mortgage assignments are fraudulent and people trying to sell their homes encounter problems related to title. His data is arguably more robust than anything put out by the overlapping state or federal investigations.

    Who knew that it would be the registers of deeds who would play a role in saving the rule of law in this country?”””

  6. Cedric Regula

    NFP +244,000, 9% Unemployment

    BLS reports that everything is great.

    This morning, everyone began eating, driving and buying stock again.

    1. Cedric Regula

      However, before becoming irrationally exhuberant, I would recommend waiting until 4:00 PM to see if we are going to Happy Hour or not. Keep an eye on the Adult Beverages Sector.

      1. Cedric Regula

        As long as it’s good for our GDP number. That’s all I care about. Plus the government just prints the stuff anyway, ya know.

  7. skippy

    Mon Due[!], I am undone, closet Marxist revealed by feline boarder, mock capitalist revenge is sift, dry food once a day only…lol!

    Truly…this family member inclusive of four kids, two dogs, another cat (which was saved on a boxing day years back from 7ft. carpet snake [young daughter beckoning…save my kitty its the most precious thing}), is a treat too behold.

    She was purchased from the local vet (mother found wandering pregnant by empathetic human), whom female discovery’s mate railed at new burden, until birth occurred (kittens joy).

    This photo was taken just after she was fixed, bad humans in their haste (life’s dilemma), had not taken care of their responsibility, yet an experience was to be had. My youngest daughter’s vision of working as a vet came true so soon. All whilst conferring with naked capitalism’s members, a mother asked my attention, in her native tongue, a call to burgeoning vets school, a ride provided by office staff, community’s response.

    All kittens were found a home, one a young policeman’s companion (may it soften his prospective in such a cruel enterprise), the others back to the same vet, visits a plenty (the last to go upon a visit, traversed many meters with in its elaborate run, to out stretch a paw between its confines).

    Skippy…a hussy of a cat, fixed or not, laid upon a cardboard palate, in repose, foils humanity’s introspection.

    1. psychohistorian

      Seems like a story to cover up cat labor abuse as clearly seen in the picture. Look at the poor cat inexorably linked to the tool of their trade.

      I suspect this cats real name is John Henry and it just got done beating the mechanized hammer to a race.

      I am tired of following reality and pine for escapism, in case you can’t tell.

  8. tyaresun

    That cat must have worked in the flourishing US manufacturing sector in its previous incarnation.

    1. MyLessThanPrimeBeef

      Some see communists everywhere – the hammer and sickle (the cat’s body).

      1. Skippy

        She is part Russain blue and Australia does have a Pinko repreputaion in some qarters.

  9. Mike

    The Iowa Tom Miller link concerning his taking money from big banks links to a different story.

  10. kevinearick

    Detroit – classic end to channel stuffing.

    The Tipping Point Anti-Matter Algorithm

    The architects were there when the global IC chip was hatched, including the launch of Microsoft, global HR, regionalization, and compliance best-business practices, “registering” all the errors and inserting the code necessary to engage at specific threshold values.

    When I go into a town, I begin with my low talent resume and work up to the high talent resume, measuring uptake on the local economic motor. The software tracks my entry and participation, to match outcomes versus the local divide and conquer metrics (male vs female, white vs Hispanic, etc); compliance vs performance; rent rates, etc. It also tracks, by algebraic reduction, the participants, from decision makers to implementers, to make the web transparent. It rewards real economic performance and penalizes divide and conquer compliance (by speeding up the computers and reducing real cash flow).

    If you want your economy to improve, get rid of divide and conquer, adopt real performance metrics, adjust rents, and re-work the computers to serve humans instead of the other way around. It’s not really rocket science. Lower rents, increase pay, and improve quality of life for high performers, to attract more high performers.

    Economies are being judged on their ability to learn, which is why all the old economies are failing. The sexists cannot learn, because they are herd animals, locking each other into repetition, with fear of change. All they can do is stop you from learning, if you let them. Stay busy acquiring adaptive skills, and let them run circles around you, until they blow up their system, and they always do. That’s what loads the spring, their denial and your refusal to chase their money. They must have your intelligence; you do not need them. The longer it takes them to blow up, the higher your quality of life and the longer it lasts, if you are prepared to take advantage of the leverage at tipping point.

    To adjust a black hole, adjust its focal point. To add black holes, superimpose their focal points. DC does have a frequency. Backlash is everything in quantum physics. The difference is relativity, which nets out time. When you are doing something you love, time passes quickly. Sexists hate themselves, and, therefore, view everyone else as competition, ensuring scarcity, in purgatory. Misery loves company; don’t give it any, but let it see you.

      1. kevinearick

        yet another cogent, internally consistent argument, but failed to use the word diatribe.

    1. kevinearick


      You want to create delay mechanism errors that fill the buffer, but do not stop the machine, until you determine the size and nature of the buffer, to reach the buffer of buffers.

  11. RDE

    The American commando team that killed Osama Bin Laden in Abbottabad, Pakistan, reportedly included a dog, sparking furious speculation about the dog’s identity and discussion of the role of canines in war. Less publicized—and far more essential to top-secret U.S. military operations—are cats.

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