Does Guinness Beer Taste Better in Ireland? ScienceDaily (hat tip reader furzy mouse)
Cave in moon: Base station for astronauts? SiliconIndia
Libya lurches close to full-blown civil war Financial Times
Saudis mobilise thousands of troops to quell growing revolt Independent (hat tip Jesse)
Georgetown law professor and securitization expert Adam Levitin has weighed in on the ruling in an Alabama case, U.S. Bank v. Congress, in which a state court judge ruled against what we have called the New York trust theory. For readers new to this terrain, the short form is that the parties to mortgage securitizations are governed by a so-called pooling and servicing agreement. The PSA, among many other things, described how the notes (the borrower IOU) were to be conveyed to a trust that would hold them for the benefit of investors. The trust was almost without exception a New York trust. New York was chosen because its trust law is both very well settled and very rigid. New York trusts have no discretion in how they operate. Any measure undertaken that is inconsistent with explicit instructions is deemed to be a “void act”.
Now it appears that the notes were not conveyed to the trusts as stipulated in the PSAs on a widespread basis. (You can read the details here). Because the trusts are New York trusts, that means you have a really big mess. You can’t convey the notes in now, that’s not permitted because the trust had specific dates for accepting the assets that have long passed. The party that has the note (someone earlier in the securitization chain) can foreclose, but no one wants to do that. It isn’t just that this would be an admission that that parties to the agreement didn’t fulfill their contractual obligations; there is no way to get the money from the party that foreclosed to the trust and then to the investors.
Since the securitization industry has had so little good news of late, and this New York trust issue has the potential to make the chain of title problems that banks are facing in courtrooms all over the US even more acute, Paul Jackson of Housing Wire was quick to jump on this pro-bank decision as a major victory. We argued that it was probably not a significant precedent, and that some of the legal reasoning looked like a stretch, other parts were at odds with decisions in other states (meaning those states were unlikely to change course based on a lower-court decision in Alabama). But we acknowledged that parts of the decision were hard to parse and over our pay grade.
Levitin has taken an even more dismissive view of the decision
Read more...We pointed last week to an analysis by Lynn Syzmoniak that showed that foreclosures across a number of different servicers were way down in January 2011 versus the same period in January 2010. This was admittedly a tally in only two Florida counties, but she indicated that a quick look at other counties in Florida showed a similar pattern.
We are seeing analogous developments, but the drivers appear to be state specific, as judges give adverse rulings on common practices in foreclosure land. Reader wc4d pointed to a report in the Portland Oregonian, that lenders are withdrawing cases because five court decisions have found that lenders that used MERS violated state recording laws.
Read more...Scientists try to determine whether life on Earth is quickly heading toward extinction Mercury News (hat tip reader May S)
What’s Killing the Babies of Kettleman City? Mother Jones (hat tip reader May S)
Shark Fin Bill Makes Waves in California New York Times. It would be good to ban bluefin tuna to be consistent.
Gaddafi troops’ ‘gains’ disputed BBC
The new Republic of Libya: temporary council P2PNet
I’m not easily shocked these days, but I have to confess I gasped out loud when I read that the former managing director of McKinsey, and until recently board member of Goldman and Procter & Gamble, Rajat Gupta, had been charged by the SEC for insider trading. Why would someone with one of the most blue chip reputations in Corporate America, who has clearly done very well financially, risk it all to make a bit more? Not only is the downside considerable, but it also isn’t as if these moves would have made a meaningful difference in his lifestyle. He already had status others would kill for. And passing profitable tips to Raj Rajaratnam was never going to be a ticket to Hedgistan levels of wealth.
But the next interesting bit was to watch the reaction in terms of what this scandal meant for McKinsey. This event was a Rorschach tests on the firm, often with a bit of schadenfreude at another elite name being shown to have feet of clay. And even though I worked for McKinsey over 20 years ago and think the firm has a lot to answer for, some of the charges are a bit barmy.
So let’s dispatch with the uninformed inflammatory stuff first and get to the real dirt.
Read more...I thought readers would enjoy this program, which was broadcast late last year but is still relevant particularly now that the State Department has acknowledged that Aljazeera is beating US newscasters. From Hillary Clinton in testimony before the Senate Foreign Relations Committee, as reported by the Associated Press:
“Like it or hate it, it is really effective,” Clinton said. “In fact, viewership of Al-Jazeera is going up in the United States because it is real news.”
“You may not agree with it, but you feel like you’re getting real news around the clock instead of a million commercials and, you know, arguments between talking heads and the kind of stuff that we do on our news that is not providing information to us, let alone foreigners.”
This program focuses on how the Pentagon has been able to get Hollywood to, um, cooperate with its efforts to present a positive image of the military (hat tip reader Scott A). I must confess I enjoyed the action footage.
Read more...Here is a succinct executive summary of everything you know about torture …
Read more...Paul Jackson has posted on a decision by an Alabama trial court involving the so-called New York trust theory that we have discussed at some length on this blog. Given how banks have been taking it on the chin ever since the robo-signing scandal broke, I suppose I’d be inclined to gloat a little, as Jackson does, in response to a verdict in favor of a bank; bank PR has been a particularly tough assignment these past few months.
But Jackson tries to treat this particular lower court decision as an important precedent, when this is anything but. In addition, Jackson evidently is not familiar the normal process of getting new legal arguments accepted in court, or of how decisions in one court are viewed in another. Finally, as I will touch on here and discuss at greater length next week, there are good reasons why it is unlikely courts in other states (or even Federal bankruptcy courts in Alabama) will look to this decision as a precedent.
Read more...Early man was ‘ancient mariner’ BBC
Smarter Than You Think – Google Cars Drive Themselves, in Traffic Spice Up Your Life
Gaddafi’s billions ‘will never be found’ Channel 4 News (hat tip reader Tim C) Confirms our earlier take.
Our session with Harry Shearer last year was so well received that he is rebroadcasting it on Sunday. Check here to find the time in your local area if you missed it on the first go-round.
Read more...First, Jon Stewart on the teacher versus Wall Street pay logic (hat tip reader Scott via Jesse):
Read more...No wonder there are so many totalitarian governments in the Middle East, North Africa and around the world…
Read more...By Matt Stoller, a fellow at the Roosevelt Institute. His Twitter feed is http://www.twitter.com/matthewstoller Mozilo’s emails expose a political philosophy borrowed from Ronald Reagan. I was combing through the Financial Crisis Inquiry Commission resource materials, and I found an interesting email from former Countrywide CEO Angelo Mozilo to his senior executives. It was written in […]
Read more...Memristor Processor Solves Mazes Technology Review (hat tip Richard Smith)
IMF warns food prices to stay high Financial Times
U.S. cables detail Saudi royal welfare program Reuters (hat tip reader Tim C)
Ohio GOP may invite backlash with tough stance on unions Washington Post
We are getting only odd tidbits out of the so-called settlement negotiations among the fifty state attorneys general, various Federal banking regulators, and mortgage servicing miscreants (meaning all of them). As Matt Stoller pointed out last weekend, the lack of transparency is troubling. Nevertheless, certain things are apparent.
1. There has not been anything even remotely resembling an investigation. As we have said earlier, the eight week Federal exam was a joke. As Adam Levitin noted:
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