Links 7/3/11

Posted on by

Antimatter Tevatron mystery gains ground BBC

Here’s The Legal Complaint WikiLeaks Is Threatening To File Against Visa, MasterCard Forbes

Hemingway, Hounded by the Feds New York Times

Ruptured Pipeline Spills Oil Into Yellowstone River New York Times

Shale Gas: Not a ‘Game Changer’ After All Scitizen (hat tip reader Crocodile Chuck)

China’s Diesel Smile Gregor (hat tip reader Crocodile Chuck)

Al Qaeda hit by credit crunch: Bin Laden emails reveal terror group is running out of cash Daily Mail (hat tip reader May S)

Strauss-Kahn Case Adds to Doubts on Prosecutor New York Times. It’s hard to fill Morgenthau’s shoes, but Vance seems to be blowing it.

Segregation in the land of limousine liberalism Salon

Imagine a MoveOn That Doesn’t Answer to Democrats David Swanson

Barack Herbert Hoover Obama Paul Krugman

Earth to Democrats: It’s Not Just the Tea-GOP Trying to Tank the Economy. Obama Believes Their Argument FireDogLake. Further confirmation of the Manchurian Candidate thesis.

Economist debates: This house believes that an economy cannot succeed without a big manufacturing base Economist

The Swindler and the Home Loans Gretchen Morgenson, New York Times. This could be an important case, in that it would do a wee bit to roll back the 20+ year trend to let accessories to financial crimes off the hook.

How the Bailout Killed Local Lending – and How Some States Hope to Bring It Back TruthOut

Antidote du jour (hat tip reader Crocodile Chuck):

Print Friendly, PDF & Email


  1. Thomas Barton, JD

    I would be very skeptical of any and all Tevatron results for the next 6 months as Fermilab which is the home of the Tevatron is in the last pitched battles over its future direction. Tevatron is to be shut down in September and the future of Fermilab is being slugged out internally–see the conflict between CDF group members v. DZero—and on the newly austere minded Capitol Hill. But given the EU reliance on dark energy levitated finance for Greece and those mysterious Danish banks perhaps Fermilab and the LHC will be combined in 2012-2014 into some new superagency.

  2. Max424

    re: Hemingway’s suicide

    Legend has it that Hemingway emptied both barrels of his Boss shotgun.

    Some say it had to be a post-mortem toe twitch that did it, but I’d like to believe , that despite his head being blown, clean off, Papa was so manly — so larger than life! — he toed the trigger a second time, from the afterworld.

  3. financial matters

    How the Bailout Killed Local Lending – and How Some States Hope to Bring It Back TruthOut

    by Ellen Brown (author of Web of Debt)

    “”The two banks that were the largest recipients of TARP funds, Bank of America and Citigroup, have cut back on local lending by 94 percent and 64 percent, respectively. Why? In 2010, the six largest bank holding companies made a combined $75 billion; and of this, $56 billion was in trading revenues—income from speculating in derivatives, futures, commodities, and currencies.

    It can be very profitable indeed for the big Wall Street banks, but the purpose of the near-zero interest rates was supposed to be to get banks to lend again. Instead, they are, indeed, paying “outrageous bonuses to their top executives;” using the money to engage in the same sort of unregulated speculation that nearly brought down the economy in 2008; buying up smaller banks; or investing this virtually interest-free money in risk-free government bonds, on which taxpayers are paying 2.5 percent interest (more for longer-term securities).

    With lending to Main Street still anemic, some states are taking matters into their own hands and considering legislation that would put local credit back into the local economy.

    detailed in an in-depth report by Jason Judd and Heather McGhee titled “Banking on America: How Main Street Partnership Banks Can Improve Local Economies.(”””


    These state banks appear to be run more as utilities to use tax dollars to facilitate the well-being of the community rather than the well-being of bank executives…

    1. Ransome

      It is not the first time banks have been characterized as simply utilities that distribute the nation’s capital in the soundest and most economical way.

      Tobin wrote a paper in 1985 called “Financial Innovation and Deregulation in Perspective”. It was a window into the future.

      Wall Street has managed to create assets out of thin air which credit created out of thin air may purchase, while the middlemen get rich in the process. Lending to Main Street is so last century.

    2. Susan

      Isn’t turning the Federal Reserve into a “utility” the same as nationalizing? What is the difference? And another question: Why are the State (country) Banks of the Eurozone in such trouble now. How does this translate to the trouble our State Banks could also encounter if we have a Fed that doesn’t rein in the TBTFs? I’m all for State Banks. But we need a new Glass Steagel first. And lots of other regulations. Especially over the CDS market. And a big fat firewall between State Banks and any kind of interstate TBTF bank.

      1. Cedric Regula

        The Federal Reserve, the one located in DC where Ben hangs his hat, is a central bank. That means they do not do banking, they do monetary policy. Then there are Federal Reserve Member banks around the country. These are private banks, and they are the mechanism thru which the Fed implements monetary policy. These banks range in wickedness depending on geographical location. The unwicked may be Kansas or St. Louis. The most wicked is The New York Federal Reserve Bank. This is because the CEOs of the TBTFs are on its board of directors.

        A “utility” bank does not have to be Federal or state run. Utility just means they only do core banking services like biz loans, home loans and consumer lending, including credit cards and checking accounts. They can fund with savings accounts and bank CDs, same as a credit union, and don’t need to tax us as a source of funding. Savers even get to make a little yield on their savings this way. Hopefully more than the inflation rate, after paying your tax on the interest (which is at your full income tax rate).

        By definition, places like this comply with Glass Steagall.

        The biz is not very profitable either, so they can’t pay big salaries and bonuses. This is why the banking industry re-invented itself. And we allowed it, via our representative government, of course.

        However, as our S&L crisis proved, and german state banks proved, they still can make lots and lots of very dumb bad loans. This is made easier by securitization and the advent of CDS. This is why we still need regulators, of the uncaptured variety.

          1. Cedric Regula

            I’d estimate that about 90% of Americans don’t understand the structure, so consider yourself in the top 10% now!

          2. Glenn Condell

            So do I Susan.

            It makes me wonder again about the quality of our schools, that so central a concern as how money works, what the Fed does, etc is so far off the radar that you really need to be an industry professional, academic, obsessive auto-didact or like me, a happy couch potato jolted out of his blissful ignorance of finance by a GFC that threatens the pleasant future he’d imagined for his children – to have even a basic working conception of what has been and is happening. I have been a bit shocked in conversations with more professionally accomplished members of my family and friends, scientists some of them, to see how utterly clueless some of them are with regard to credit creation and central banking, fiat money and securitisation, you name it. None of them have heard of primary dealers.

            Is the virtual totality of this ignorance an accident?

  4. Anon

    Oh, man! That Vimeo clipWhat does it cost to change the world? in that piece about Wikileaks is hilarious!

    Julian Assange stars in a spoof of the Mastercard ad:

    “Twenty secure phones to assist in staying anonymous: $5,000. Fighting legal cases across five countries: $1,000,000. Upkeep of servers in over 40 countries: $200,000. Donations lost due to banking blockade: $15,000,000. Added cost due to house arrest: $500,000. Watching the world change as a result of your work [cut to shot of Egyptian revolution in full spate] – priceless. Some people don’t like change. For everyone else, there’s Wikileaks.”

    Comedy gold! Julian, if nothing else, has a GSOH.

    And only yesterday, we were discussing Eldridge Cleaver.

  5. Max424

    Here’s Jeff Rubin’s take on the IEA’s (panicky? brilliant?) oil release:

    I think Gregor and Jeff … are both right. And I also believe, NATO powers see swift and glorious victory in Libya as imminent, and this knowledge — based, no doubt, on infallible loafers-on-the ground CIA reporting — is playing a more than sub-critical role in the release.

    The theory starts like this: we’re going to win (VICTORY for the HUMANITARIAN INTERVENTIONISTS is COMING to a DESERT NEAR YOU!), so why not release some of “our” reserve shit now, because some new…slash…old shit, is soon to come, back on line!

    Once we have dragged al-Qaeda Gadhaffi’s boated dead body through the streets of Tripoli, everything will fine, and within weeks, Libya once again!!! … will be pumping out 1.5 million barrels — or more? — of that oh so sweet, light crude.

    And that’s how the theory ends.

    1. Cedric Regula

      I’ve read Libya oil is 2% of global supply. I also just read Chinese car ownership grew 26% over last year.

      Methinks the victory will be short lived.

    2. Freude Bud

      Libya definitely has something to do with the timing of the IEA release, but the key is the height of the driving season, in which you see the highest demand for gasoline and diesel in the US, more than 20% of the global market. By the time the release is done, October will be the front month on ICE and NYMEX, and we will be heading into the winter season.

      Gregor smells like he bet long on oil and is upset, the notion that the release will set the speculators aboil is just a tad tenuous. The oil should start being delivered now, we will see what effect it will have on the markets.

      One problem with the release is that the shortage isn’t here in the US, but in the world. Crude oil can’t, with a few exceptions including Alaskan crude and CA to the Pacific rim, be exported from the US. If 2 mb/d are released, and of that 1 mb/d is in the US, then you still have a shortage of 300-500 kb/d globally from the absence of Libyan crude. You can export SPR bought crude given the right permissions from both the BIS and DOE; if folks go to the trouble, you will likely see a sharp drop in the price of Brent.

      That said, part of the reason that the price of LLS remains elevated and closer to Brent, as opposed to WTI, is because the prices of products, which can be exported, can be understood as something closer to world prices … the release should still put downward pressure on crude here … just give it a little time to work through the system.

      1. Cedric Regula

        The total amount to be released from strategic reserves is 60mbls. Global daily demand is 85mbls. So they are releasing about 2/3 of a day of oil.

        I don’t think that will spook speculators, and they don’t really believe it will either. Just a political gesture.

        WTI is landlocked in OK, which has been determined to be the reason for the spread between WTI and Brent crude.

        There are the new S. Dakota fields feeding in there, and I didn’t really think West Texas would be boosting output. So maybe supply is up in the plains states. But it may also indicate demand is off in the US due to high pump price or general economic weakness.

        1. Freude Bud

          Yes, it’s less than a day’s global supply, but the part that’s missing is Libyan supply, or 1.3 – 1.5 mb/d, which means it accounts for 40 days of supply through the driving season.

          Of course, they are to deliver 2 mb/d which more than accounts for the Libyan shortfall.

          The entire global market–meaning oil that actually goes on the international market instead of staying at home–for light sweet is probably less than 10 mb/d, so 2 mb/d is a big big deal.

    1. JKL

      Actually, he is more or less doing what most overly-indebted first world countries are trying to do–save some cash at the federal level and leave the burden to the lower (eg: state/provincial/municipal) level.

  6. Paul Tioxon

    A MoveOn that does not answer to Dems, is typical cannibalistic humanoid underground dweller thought process, (CHUDthink). Since there is no greater crisis currently than that of 10s of millions unemployed, the foreclosed, and defrauded and defunded public budgets and the most vigorous publicly proclaimed attacks on Social Security, unions… all of the New Deal and Great Society, you have to wonder just what is the concern for peace and de-militarization calls to further distract the citizenry.

    Obama has clearly de-legitimized the war of choice in Iraq by proclaiming it as such. Having removed almost 100,000 troops with the remaining 45,000 scheduled to be gone in less than 6 months, there will be no American war in Iraq. Afghanistan is also scheduled for troop reductions and the critical path of retreat is being hammered out in public, with the first 10,000 troops set to be withdrawn starting next year. This is a complete reversal of course for the New American Century Project and the wholesale merchants of death as outlined on The Committee for The Present Danger website:

    To even slightly compare Barack Obama to this outfit and the legion of doom that parades in lock step march behind their agenda setting leadership is much more than a distraction. The wistful stylings of romanticism for a world better than the one we are born into naked and crying is an insipid uninformed politics or something worse. And I don’t mean a paid agent of capitalism, but even worse than that, someone who does not even bother to read the relevant literature, form a coherent analysis and simply states truism like nuclear war will kill us all unless we kill all of the nuclear weapons. There are opportunistic moments when you squeeze those in power to get what you want. But since the military invasion forces are being decommissioned as stated policy and actual fact, what is the point of attacking fellow left of center organizations like moveon? Explain it to me in terms other than NY Times or WaPo something something to the base. The base, my experience of it, is happy with NLRB moving against Boeing in favor of the machinist unions. My Dem base is happy with nationalization of student loans and billions more going into Pell grants. My base got 99 weeks of unemployment, only interrupted by the takeover of the mother fucking tea party and Grover Norquist’s no tax pledge zombie politico army. My base got gays in the military. My base just got gas down to $3.55/gal, by Obama moving against the speculators. How much more do I have to go on? Obama is unwinding shit Clinton wouldn’t touch, and I mean Hillary. The whole war on terror bullshit is being wound down to less than hysterical Arab baiting levels of riot inducing racism promoted by Beck, Limbaugh and Co.

    There is always a lot of mileage in peace activists, but why is there mixing in an attack on MoveOn. I have personally participated with their on line questionnaires, extensive 20-30 minutes probing of what I thought was important and it was put to a vote using all of the respondents. The priorities, which could have included more peace activism, did not win out, because of the other priorities, primarily economic that are just too immediate and pressing as compared to unilateral disarmament. If you want to see more defense budget cutting, there is a greater opportunity for that now, than ever before, ironically, with the isolationist tea party politicos. But, there is less chance of that happening, than a 3rd stimulus which seems to be in the making with Larry Summers offering trial balloons on that issue.

    If you want to promote peace and justice, lower military spending, fine, why this is necessarily linked to attacks on MoveOn is more chudthink from the future David Horowitz Club. Better yet, go to law school and get a job. Leave policy analysis to people who really care about people, and not ideals.

      1. Danb

        “My base just got gas down to $3.55/gal, by Obama moving against the speculators.” As if speculation is the underlying problem, and as if Obama really did something about speculators (what about Wall street? IS Obama unwinding it?), and as if peak oil is irrelevant, Finally, as if a temporary price drop to $3.55 is any kind of economic respite to begin to build a sustainable economy, let alone a solution to keep a growth/waste based economy going. And this string of fantasies is draped in SMUG “adults-in-charge” rhetoric.

  7. Susan

    What did we achieve in this great middle east war? In Iraq we wiped out a decent civilization when we could have just gone in and shot Saddam like we did Osama. No, that would have been too easy. We haven’t made Israel any more secure. In fact we’ve probably reduced Israel to eternal anxiety. We haven’t helped the Palestinians. We have lost several two-bit dictators who used to back our “policies.” We are bringing down Syria by false civil war because Syria borders the Caspian. We bulldozed through Afghanistan buying off warlords and opium cartels, pretending we were just liberating women from burkas. And paraded that shitass Karzai before congress. We seem to have put the Saudis on notice. That one is a mystery. We are all over the horn of Africa which also gets little press. We’ve ruined Pakistan. We probably participated in Bhuto’s assassination. Wouldn’t want Pakistan to be stable at this point in time. Because we are still in the process of achieving whatever it is we are achieving. When you look at a map it looks like we are surrounding Iran and intend to thereby control Iran. But why. That doesn’t seem to be an end in itself. I can’t see how this solves any politics at all. Its just one big mess. And we’ve just whacked Gaddafi and taken Lybia’s oil, because Gaddafi has been too double-dealing. Kind of like Marcos – but that was another story altogether. Oh, maybe this is what we achieved: just found this blurb: Al Qaeda has been caught in the global credit crunch and is running out of money. Yay! We did it!

    1. hermanas

      @ “… we are still in the process of achieving whatever it is we are achieving. When you look at a map it looks like we are surrounding Iran and intend to thereby control Iran. But why.”
      As an unimpressed Russian said on the demise of the cold war,”You Americans always need an enemy.”

    2. Charles

      War profiteering, oil profiteering, support for increased Jewish theft of Palestinian lands, commodity profiteering, financial profiteering, socializing the cost, debt, loss, risk while privatizing the profit profiteering, bank profiteering, outright theft, energy profiteering, corporate welfare, redistribution of wealth, empire building, privatizing the military, and last but not least a christain crusade against muslims.

  8. Freude Bud

    Re: the shale gas story:

    Yes, at $4/MBtu you won’t be able to get all the gas, but the reason gas is so cheap is because the shale gas has added so very much of it to supply, going from 30 odd years of supply to over 100 years. Sure, $11/MBtu is more expensive, but, that’s just a little more than the wholesale price of natural gas in, for example, England RIGHT NOW. $11.50/MBtu = $66.70/boe so is trading at a $30 discount to WTI NOW, never mind the price of oil in 20 years.

    The more we up the rate we extract, the more expensive it will become, but it will take a LOT more extraction to even make the price equal to the btu cost of oil.

    So, yes, it’s not an endless free source of energy, but so the bleeding hell what? Give me a break.

    1. Cedric Regula

      The price of coal has gone up a lot too, which is what the power plant industry looks at.

      Then we have a very large number of very old coal plants that were exempted from emission standards adopted in the 80s. The EPA just announced they too will need to comply with the newer standards, which means very substantial upgrades like fly ash collection, SO2 scrubbers and NOx conversion. This doesn’t even address CO2.

      The utilities may find it’s uneconomical to do these upgrades on a very old plant and just close them. Especially if they sense some action on CO2 emissions is coming.

      Then all our 104 old nukes will have expiring operating licenses over the next ten years and in theory need to be decommissioned.

      We need some direction to run in.

  9. Susan

    Just read Hemingway article. I was not surprised to learn that the “Feds” had been surveilling him since the 40s. He was a long time insider in Cuba and when Batista was overthrown (by us) he Hemingway publicly made the statement that it would be a big mistake to say it was a communist takeover. Which is exactly what we then proceeded to do. And I have read several accounts of other men (mostly) becoming “paranoid” about the Feds. Catherine Graham’s husband comes to mind. Sounds to me like it was possible to not only surreptitiously surveil anyone but also to slip something into their food or drink. It always sounds like they are just going crazy. But they clearly are severely ill, depressed and have such a chemical imbalance they cannot right themselves. Not even at the state-of-the-art Mayo Clinic.

  10. Susan

    I’m slow. I’m also on Mountain Time. And I get up late. I just read Krugman’s piece Myths of Austerity. Couldn’t take issue with any of it. I like his patience. He has presented this info a thousand times. So I have come full circle (albeit in spiral fashion with circles to come) to my instincts: Just print up the money and spend it wisely to fix our problems and employ us all. There is so much to be done. And if Larry Summers can come up with a good plan to use this debt to stimulate consumerism, let Larry tell us all how this improves the planet. Maybe he has a legitimate idea. Maybe not. I don’t think the manufacture and marketing of a bunch of trinkets helps the planet. But that is my current image of consumerism. Please, Larry, splain yourself.

  11. Hugh

    Liberal orgs like MoveOn, as well as the unions, as well as the elite blogs, are all Trojan horses portraying themselves as progressive but in reality nothing more than handmaidens of the Democratic party. This is the same Democratic party under Obama’s leadership which has continued and expanded all of the most noxious policies of the Bush Administration: the assault on the Constitution and individual rights, bailouts for the banksters, and the imperial wars. Even as Obama schemes to cut Social Security and Medicare, Democratic tribalists still try to tell us that there are real distinctions between the Democrats and Republicans.

    Someone upthread tried to give credit to Obama for ending the war in Iraq. It’s important to remember that the withdrawal from Iraq is on the Bush schedule, that Obama has been trying to pressure the Iraqis into keeping American troops in the country beyond the date agreed upon in the SOFA, and that a major portion of the State Department’s budget will be to fund a gargantuan embassy in Iraq. Why might you ask would we need such a large embassy in a country where our presence is so unwelcome?

    Extending unemployment benefits to 99 weeks is portrayed as some kind of a victory. This contention obscures two relevant points. It doesn’t look like a victory to the 99ers who are being dumped off the rolls. And it completely and likely intentionally overlooks this Administration’s failure to push any real jobs program.

    The same argument can be made about Obama’s move against oil speculators. I have written on excess speculation in oil for years. Obama could have moved against any time since his election. The most recent spike began on February 22, 2011. It took Obama to mid-June to do anything about it, and he did so even as prices were easing, due to fears that the price gouging was driving the country into recession.

    It is unsurprising that, because Obama has no record to run on, Democratic tribalists would invent one for him. But just because they do, there is no reason any of us are obliged to believe it.

    1. Paul Tioxon

      Hugh, I am going to go out on a limb here and ask, as compared to what is Obama so short of the mark? I will assume that the Rs are not even in the race for you. Obama has no record to run on according to you, is simply a continuation of the Bush era. And it also seems, you have been writing against oil speculation for quite some time. Great. But as the person who is in government, who has the power to do something about oil speculation, and did something about it, and is driving down the prices so fast that he is now being accused of performing a trick just to get re elected, Please, President Obama, trick me some more, I am so confused and uninformed in my fucking tribal hut that I still go to Blockbuster for my movies instead of streaming them directly to my ipad.

      Hugh, what is a democratic tribalist? Do we chuck spears or do we use bow and arrow? Or are we sequestered in some far off rural area in fly over land? Or is this a colorful line you picked up from really, really radical writings that are not clouded by cultural bias. You know, the kind that gives you tunnel vision when you are in a tribe. Enlighten me, as clearly, you have debunked me point for point with your clever way so saying, no, it is just not so. I am floored, is it Oxford or Cambridge debate tactics? I need to get me some of them for my tribe. Uga Boogah!!

      1. Hugh

        Obama has not been short of the mark, that is if the goal is kleptocracy and the benchmark is the Bush Presidency. It is important to look past the atmospherics to the actual policies. There as I pointed out there is no discernible difference between a corporate Republican party and a corporate Democratic one. The only choice we in the rubiat have is whether we like being sold out to the tune of right wing or liberal rhetoric.

        Tapping the SPR is pure theatrics. We have seen this all before and it follows the same script. Speculators put constant pressure on oil prices. Despite all the hoopla about supply and demand and Peak Oil, the baseline price, minus excess speculation should be somewhere in the $40-$50/bbl range. Within this constant pressure, they also orchestrate spikes. They continue the play until public anger causes government to do a little saber rattling, and then prices fall back, some. The politicians declare victory and pat themselves on the back, and the speculators pocket their winnings. The markets are left unreformed, and speculators can again spike prices when they choose.

        Real reform would involve in squeezing the non-commercials (financials) out of the market, largely closing out the over the counter market, and increasing margins and limiting rollovers as needed to reduce the number of paper barrels to physical ones. At it is now, there are hundreds of paper barrels for each physical barrel. So unsurprisingly, it is the paper barrels that determine the price. Obama as far as I know has not gone near any of these. The most I have heard was that there might be some mild, and largely ineffectual, increased reporting requirements. But I am not sure when if ever these may come online.

        As for partisan tribalists, it is simply the term that is used for those who identify with a party and defend it even when that party is working actively against their interests. So we have Democrats who criticized Bush for his policies but do not criticize and will even defend Obama when he continues and expands those same policies.

  12. Skippy

    OT apocalypse watch…whilst helping a young lass relocate her business premises (4G less a M/but still with in the affluent zone)(large old house with semi attached old school retail frontage. I chanced upon her new landlord, an affable financial refugee from London, 2 years since relocation (snicker). Seems this lad found Law a trite and need more stimulating endeavors to light his neoliberal fires. Well as end of day let a few ales flow and tongues wag thoughts were exchanged.

    The endless stream of paycheck bias was a sight to behold, classics like, wage arb as a means to lift living standards globally, you can’t regulate markets, any thoughts contrary to free-market dogma is tinfoil conspiracy and issued by losers, etc, etc.

    Skippy…I suggested that Law had not been served, that dirt law….cough…capitalism’s bedrock and been fractured, that HFT et al had removed the last vestiges of market functioning, and all I got was sound bites, all this coming from a barrister. Someone that should understand more than most the function of Law…societal trust…well once you have eaten the apple of pumped up electron bonuses ( zero productivity ) slash extraction of others toil by computational churning…it is hard to go back I guess.

    PS…afterwards he called a friend in the game, I wont tattle tell (he was unaware he was overheard…loud), but, not a happy camper, knowledge is the most crucial component, and it’s slipping through their fingers. Watch them run, cower, change their stripes, speed and mass thingy.

    And now a slice of dada pie, dig it man:

    1. Glenn Condell

      ‘The endless stream of paycheck bias was a sight to behold,’

      The check plays its part but there is a kind of class bias too, or rather tribal niche bias. I recall having arguments at college with affable sons of wealth, Pitt St farmers and real ones too, who used to deride my politics as an artefact of my provenance – a working class family in a steel town dominated for years by unions. And I theirs as a self-interested defence mechanism to justify the gains, ill-gotten or otherwise, that had put them thru Kings or wherever.

      Perhaps we were both right, the point being that it is hard for a lot of people to lift their mind out of the groove it has been placed in by circumstance. Not long ago a more worrying example, dinner with friends in CBR, invitees including the political editor of the major finance daily here and his partner, DFAT mover and shaker. The ignorance of and dismissive tone toward blogs in general and political blogs in particular was a shock, and instructive too but not in an encouraging way. Their talking points and reactions to mine were pure, distilled MSM wisdom.

      Greed and a sense of entitlement sit behind a lot of the false consciousness and self-delusion we see all around us, but part of it isn’t so much ‘I think this because of what I earn’ as ‘I think this because this is who I am and how I see myself, plus, that’s what all my mates think’!!

  13. Glenn Condell

    ‘Further confirmation of the Manchurian Candidate thesis. ‘

    Well, it’s a three horse race.

    1 Manchurian Candidate – brainwashed automaton under remote control from either Langley or the Fed (or both)

    2 Greatest Disappointment in History (I mean, who else? Kerensky? Commodus?) – some nice ideas, but one of the weakest individuals ever appointed to high office

    3 The most successful grifter of all time.

  14. Thomas Barton, JD

    Zero Hedge has as its current lead a story citing NYTimes that BofA and JPmOrgan are commencing large scale mortgage writedowns. Is this true and or just window dressing before congress comes back to town after 4th holiday ?

    1. Yves Smith Post author

      Please, don’t trust ZH on anything related to the credit markets. That includes mortgages. They can’t be bothered to learn the terrain. You can’t figure it out from Bloomberg screens or hedgie gossip.

      I’ve been discussing it on a thread of experts on mortgages. Small scale and on really toxic mortgages probably already written down by the banks, so no balance sheet cost to the bank to offer the mod.

      This is a PR stunt and ZH fell for it.

      1. JKL

        I was torn between guessing it’s a PR stunt (how else would a reporter have gotten wind of this?) and thinking that it might allow the banks to not have to increase their Non Performing Loans provisions.

        If it’s the latter, the banks will have to do a hell of a lot of this to make the numbers work. If it’s the former, it’s sort of a pathetically hopeless attempt, since nobody’s going to change their minds on the banks any time soon.

        If I were in charge of PR for the banks, I’d tell’em all to do what Goldman is doing–jus shut up and avoid the media and hope that people are as stupid as poll numbers indicate

      2. Thomas Barton, JD

        Merci beaucoup. I have wondered why there is so little written about Wells Fargo in connection with the entire BofA universe. Doesn’t Wells have many things in common with BofA in regards to mortgages and real estate US exposure ?

        1. Cedric Regula

          Wells Fargo has been able to keep their halo remarkable clean. That’s quite a feat considering how much west coast RE exposure they have. Now and then a few tidbits leak out. Like they own their own title company and if you go into escrow, they try and make you use their title company. Then the small print you get in the paperwork as you are shuffled out the escrow room, post signing, is the title insurance doesn’t really cover chain of title problems. Nasty trick.

          I think BofA used to be pretty respectable, then they bought Countrywide. Countrywide was the bank from hell in the mortgage biz.

          1. EZ Al and Uncle Ben's #1 Fan

            Just for fun, take a look at WFC’s provisions for loan losses over time, and look at how their definitions of delinquency has changed over time :)

          2. Yves Smith Post author

            EZ is right. Wells is loudly sanctimonious, plays all sort of games with its accounting, and looks good only by virtue of comparison with Countrywide. If BofA started looking seriously wobbly, Wells is close on its heels.

Comments are closed.