Links 3/9/12

Thousands of spiders blanket Australian farm after escaping flood Yahoo (hat tip Lambert). You need to check out the pictures.

Honey bees study finds that insects have personality too PhysOrg (hat tip reader Robert M). Now I’ll have to feel guilty about killing insects?

The 8-hour Sleep Myth Alternet

Renowned Wine Dealer Accused of Trying to Sell Counterfeits New York Times. I am really dense. I can’t fathom why someone who is well off and well respected would do this sort of thing.

Carolina woman accused in beheading plot McClatchy (hat tip Buzz Potamkin)

Greece to Invoke New Powers to Boost Participation in Debt Swap Wall Street Journal and Greek Debt Swap Clears 95% Level as Euro Chiefs Ready for Call Bloomberg. The deed is done, but this still won’t carry Greece very far given that austerity is producing an economic implosion.

China Car Sales Have Worst Start Since 2005 as Economy Slows Bloomberg. But inflation has slowed, so Mr. Market assumes the Chinese officialdom will engage in more stimulus.

Measuring China’s real estate bubble MacroBusiness

NC (more specifically, our man in Dublin, Philip Pilkington) scoops the Financial Times! FT front page story: QE blamed for surge in pensions shortfall. NC story February 14: Philip Pilkington: Pension Provider to British Government – “QE Actually Does Kill Demand!”

Chart of the Day: Monetary Transmission Mechanisms Ed Harrison

Deutsche Bank tapped ECB for up to €10bn Financial Times

FBI Director: I Have to Check to See If Obama Has the Right to Assassinate Americans On U.S. Soil George Washington

Obama lionized for tough decisions in campaign film Yahoo. “Tough” and “Obama” do not belong in the same sentence. Lambert deems this to be a “mockumentary”; I’m hoping someone can do better and with minimal editing turn it into a parody.

GOP Loses Big Voter Suppression Case In Federal Court Alternet (hat tip furzy mouse)

NAACP to challenge state voting laws before U.N. panel in Geneva McClatchy

MF Global Customers Call Trustee’s Demands ‘Unwarranted’ Bloomberg (hat tip reader Francois T)

MF Global Still Set to Pay Executive Bonuses Wall Street Journal

Obama unveils new foreclosure measures to resuscitate housing market Washington Post (hat tip Lambert). Wow, serious blow job. I need to debunk this, hopefully I’ll get to it over the weekend. Still feeling punky.

Banks foreclosing on US churches in record numbers Reuters

Wells Fargo Ends Free Checking in 6 More States Bloomberg (hat tip Lambert)

Lowering our expectations for foreclosure settlement Chicago Tribune (hat tip Lambert). This is one of the best one stop treatments on the failings of the deal, and it still misses the second lien treatment as backdoor bailout and how farcically bad the servicer consent orders are.

The Pernicious “Foreclosures are Good” Meme Dave Dayen, Firedoglake (hat tip reader Carol B)

U.S. Regulators ‘Paralyzed’ by Cost-Benefit Suits, Chilton Says Bloomberg. Um, I gather the banks manage to exclude the cost of blowing up the global economy.

An Industry’s Failure to Verify, After Trusting Floyd Norris, New York Times. I’ve said that MBIA is the only company where I would routinely feel the need to wash my hands after reading its communiques to investors.

Former New Jersey governor goes undercover as homeless man Yahoo (hat tip Lambert)

Antidote du jour:

And a bonus of sorts, hat tip reader Swedish Lex. First, I was appalled by the premise, and am not sure the movie can carry it off, but I have to say I wound up enjoying the trailer. Second, I guarantee if this movie gets any circulation in the US, it will be credited with inspiring a nutjob (not that said nutjob would not have eventually found some other excuse for what is now called “going postal”):

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  1. dearieme

    “I can’t fathom why someone who is well off and well respected would do this sort of thing.” Because he can.

    1. Richard Kline

      This wine fraudster was well respected because he had extremely rare wine nobody else could source. He was well off because the credulous wealthy believed that their money entitled them to be the lucky receipients of his wares. He was further respected because he’d go into the best wine cellared restaurants in the country with a large entourage and drink down their highest of high end bottles, which consumption allowed him to pass himself off as an elite connousieur of the sort who might actually have the connections to acquire such extremely rare bottles.

      But the bottles were faked from the get go. So . . . he had no special skill at wine tasting. He had no money or wine cellar to speak of behind him. He was a penniless Indonesian immigrant ten years before who was told to leave the US but didn’t. What he had was an endless supply of well-moneyed fools and the gumption to trade them not much for quite a lot. These weren’t even good frauds either (read the story) as the provenances he provided were not well-researched and so easily, and repeatedly, identified as frauds once numbers of sommeliers who knew what was on offer was simply not in existance on any market no matter how private.

      This reads like so many other art frauds. A ‘bold connection’ to ‘the good stuff the rubes can’t get’ with a natural touch for big, soft wallets . . . . The story of a self made fraud.

      1. JefeMT

        Choice defraud: I surprised this didn’t get the patented Quelle Suprise!” from the huumble blogger. I’d argue before Madoff gained the deserved negative notariety, he was in the rich and respected’ category… even sought after . Greed? ditto Corzine…. greed, power, abject inanity in a vaccuum of morals?

        The problem is not in the tars, but in ourselves…

        From the oil patch

      2. JefeMT

        Choice defraud: I surprised this didn’t get the patented Quelle Suprise!” from the huumble blogger. I’d argue before Madoff gained the deserved negative notariety, he was in the rich and respected’ category… even sought after . Greed? ditto Corzine…. greed, power, abject inanity in a vaccuum of morals?

        The problem is not in the stars, but in ourselves…

        From the oil patch

        1. aet

          Spoken like a Tudor gentleman!

          Now the Russian version: “The problem is not in our Tsars, it is in ourselves.”

          But nevertheless, the cause of a social or political problem at hand sometimes IS bad leadership – simply that – and has NOTHING AT ALL to do with “us” or “ourselves”, or with the “stars” (that is, whatever theoretical power or process
          we take on faith as being “pre-determinative”).

          Sometimes the problem DOES lie in our Tsars.

      3. Glen

        So the FBI will bust some guy for faking a couple million in wine.

        What about the couple trillion in fraudulent MBSs, CDOs, and the empty trusts, plus all the thousands to millions of faked documents pushed by MERS for foreclosure?


        1. Doug Terpstra

          Do not swindle the one percent. This pretender never learned the critical lesson from Madoff. It’s the only time the FBI will pay any attention to fraud.

    2. Glen

      As a side note – I went to college at UC Davis (which has an extremely good Department of Viticulture & Enology) and ended up knowing and rooming with scions of wine maker families. Asking one about what he (his family ran about the tenth largest winery in the US at that time) thought of expensive famous old vintage wines, he replied, if they’re so damn good, why haven’t they drunk it all already? (He was pretty drunk at the time.) He thought anybody that paid that much for an old bottle of wine was a damn fool, abet still a wonderful “customer”, but pretty much nothing but a fool.

  2. Cynthia

    Yeah, Obama is tough when it comes to murdering US citizens without due process. But his toughness stops there. It’s a very dark day in American history when our president’s only claim to fame is being a extrajudicial murderer.

    1. tom allen

      As Chico Marx would have said, what do you believe — the facts, or your lionize? :-P

        1. Cynthia

          Holder said that there are many kinds of due process, and this is where the needle should go screeching across the record, and the speech comes to a halt, and everybody should say, what?

          Many kinds of due process? Well, um, no. Wrong. There’s only one kind of due process, and that’s an independent courtroom.

          If you don’t have a court you don’t have due process; what you have is murder.


    1. Susan the other

      Those spiders. Wolf Spiders in Australia escaping the flood waters. Shame not to harvest all that silk which is stronger than steel and blah blah blah. Australia could soon be the spider ranch of the world. Too bad spiders are so creepy. It will take a serious wrangler to handle them – one who doesn’t get the willies. No screaming like a little girl.

    1. tom allen

      International Powers? You’re sure he didn’t say Austin Powers? Legally, that would make just as much sense. And be about as funny.

    2. JIm Sterling

      It was in the early morning hours
      When I fell into a phone call
      Believing I had international powers
      I slammed into a brick wall
      I said hey, is this my problem?
      Is this my fault?
      If that’s the way it’s going to be
      I’m going to call the whole thing to a halt

    3. ohmyheck

      It seems there are two issues being debated, in that video.

      The first one is that the US agrees to work with NATO or the UN when it comes to starting a war. Well, we joined both groups, and agreed to play by the rules of those groups, and Panetta seems to be saying that.

      The second one is that Sessions is rightly outraged that Panetta seems to believe that the Administration can come before Congress and discuss starting a war, only if the Administration FEELS like it. This statement seems to be in direct conflict with the War Powers Act, for starters.

      That’s just my take.

      1. Jim3981

        Congressman Sessions Q: “Do you think you can act without congress to initiate a no fly zone in Syria?”

        Leon Panetta A: “Our goal would be to seek international permission, and come to the congress and inform you.”

      2. aet

        The UN Charter forbids war for territorial expansion and conquest: it does NOT forbid the use of deadly force against non-resident individuals engaged in organized violence against a State.

        The real question is: are drones or air strikes means which may with justice be used for these actions?
        Are drones not too indiscriminate in the damage they cause?
        Why is it ok to use air strikes abroad against violent fugitives, but not on US territory?

        What is the difference in principle between the two situations – air strike abroad, or air strike at home? Or is the juridical difference between the two situations simply one of style and taste?

        Would it have made a difference if John Dillinger was killed from the air, rather than as he was, by police ambuscade?

        Perhaps the Israelis, who have long practise at these types of air strikes against specific individuals (didn’t the Israelis pioneer that tactic?) could give the US some pointers on how to use the tactic with justice.

    4. Susan the other

      Panetta looked annoyed. What was wrong with Sessions that he didn’t understand that the Pentagon has long since done a successful end run around Congress. Please.

      1. aet

        Oh, please….the Pentagon had Congress’ prior approval to do what they’ve been doing – and I have not noticed any sustained criticism coming from either House as to the propriety of the tactics under discussion.

        Except perhaps insofar as such criticism can be used to sever Pres Obama from his peacenik base: or, to make his Administration’s specific uses of these tactics seem unjust or ill-advised – but (afaik) Congress has betrayed no qualms about the general use of such tactics. At least, I’ve not noticed that the Republicans in Congress show any qualms about the use violence as a policy tool by the State – when they feel it’s justified, that is.

        1. LucyLulu

          Could you imagine the reaction if China or Pakistan decided to use drones against citizen dissidents on US soil?

          1. aet

            Aaaah, that’s exactly why the policy takes great care to obtain the clear and prior consent of the territorial sovereign which has jurisdiction over the space in which the contemplated “operation” is to occur.

            Now – considering your stated example – were the US Government to give its clear and prior consent to the proposed Chinese “operation” in advance, then THAT situation would be much more analogous as to what has actually happened in Waziristan, or in Yemen.

  3. Judy C.

    Wine dealer probably lost a lot of money and is resorting to desperate measures. Why else would someone do this? He is desperate for cash.

  4. scott

    I guess they don’t have to film part two of “Atlas Shrugged”. Just change the names of the characters in the Obama/Biden film.

    1. Klassy!

      Davis Guggenheim: Our answer to Leni Riefenstahl?

      Naah… just our modern day Edward Bernays.

    2. Wendy

      The theme and the high school girl link it strongly to Heathers. Same idea. And a beloved one; Heathers is a longtime cult favorite.

      1. aet

        Boy oh boy are there ever a lot of bad movies. Real stinkers, some of them. Complete wastes of time.

        And lost time is not found again, you know!

          1. ambrit

            More like “Odds and Sods” you might say.
            Go and watch this film with an average crowd and listen to the crowds reaction. Where they react and how will tell you a lot about the frame of mind America is in. Everyone at work I mentioned this trailer to first laughed, and then got a bit serious. No one condemned it outright.

          2. ambrit

            Mr. Strether;
            Good point, although I find it hard to visualize Bobcat Goldthwait as a 1%er. As someone else remarked in this thread, why aren’t the indignados targeting the 1%? As for the Zeitgeist, aren’t there many of them? One for “The Grapes of Wrath” and one for “My Man Godfrey,” and on and on?
            Sometimes it leads to thoughts of Fata Morgana. And then I found out that Werner Herzog beat me to it. Now, if Bobcat had convinced Herzog to direct the film.

          3. skippy

            Ahhh… Pulp Fiction at a student night in the early 90’s, just off campus C.U. Boulder (next to taco bell sinker ).

            The crowds delight in vocalizing Tarantino’s reality… “I’ll shoot every MF’er in here”… Money well spent mom and dad!

            Skippy… Aww I’ll still take rocky any day, water pistols and toilet paper… with a bit of sex thrown in.

            PS. Great party theme for 3rd world embassy party’s, on the beach too! Bit of rugby with the military advisers, ensuing brawl and then its party time! BTDT….

    3. joel3000

      Reminds me of “Series 7: The Contenders.”

      It’s about a reality show in which players, chosen randomly, are given guns and must hunt down and kill the other players, while the TV cameras tag along.

      The prize for winning? You get to play in the next round.

  5. russell1200

    The Church foreclosure story is an odd one. It starts of sounding like a churches in trouble story. But in the end it talks about how it is the banks trying to clean up their books and initiating 90% of the foreclosures.

    Since Church loans are commercial loans with a 5-year balloon, they are very vulnerable to not having their mortgage renewed.

    It also notes that 138 churches were foreclosed on in 2011. Wake County (state capitol) County North Carolina lists 404 Churches all by itself. There are 100 counties in North Carolina. The number of churches in the United States must be some sort of enormous number of churches in the United States.

    1. Ned Ludd

      According to Hartford Seminary’s Hartford Institute for Religion Research:

      Hartford Institute estimates there are roughly 335,000 religious congregations in the United States. Of those, about 300,000 are Protestant and other Christian churches, and 22,000 are Catholic and Orthodox churches. Non-Christian religious congregations are estimated at about 12,000.

      A coupld of other interesting facts from their website:

      • “50 percent of churchgoers attended the largest 10% of congregations (350 regular participants and up).”

      • “Kirk Hadaway and Penny Marler found that only 20.4 percent of the population, or half the Gallup figure, attended church each weekend.”

      • “As of 2012, there were roughly 1,600 Protestant churches in the United States with a weekly attendance of 2,000 people or more. That’s nearly 25% more than 2005…”

      Their website also links to a study they co-sponsored: “The American Mosque 2011”. According to this study, there were 2,106 mosques in the U.S. as of 2010.

    2. LucyLulu

      The Catholic church has had a long-standing policy of closing down churches that are unable to collect enough donations to support themselves. The Church has not become the richest organization in the world by using poor business practices.

      1. propertius

        The last estimate I saw for the net value of Catholic Church holdings was a mere $52 billion – which is pretty far from being “the richest organization in the world”. In fact the Walton family is considerably wealthier, to say nothing of Bill Gates or numerous corporations and governments.

        1. ambrit

          Dear propertius;
          As to just HOW the Gates and Walton families got their fortunes; consider, these corporations are run on semi-cult like lines. “We are W M ! Woo, woo woo!” Chanted in a circle, group think personified. Very much like an Est meeting I stumbled into way back when. Have you ever wondered how most working cults end up a small very comfortable priest(es)hood living off of the sweating, adoring masses?
          So, don’t compare the Church to these “Titans” of Commerce. Lump them all together.

    3. F. Beard

      Besides ignoring the commandment against usury (Deuteronomy 23:19-20), churches apparently ignore this one too:

      Owe nothing to anyone except to love one another; for he who loves his neighbor has fulfilled the law. Romans 13:8 [bold added]

      But the counterfeiting cartel so drives up real estate prices that honest saving to buy is precluded.

      1. aet

        Seems they had some problems with charging interest way back in 325 AD:


        ” Concerning clerics who practice usury

        17. Since many enrolled among the clergy have been induced by greed and avarice to forget the sacred text “who does not put out his money at interest,” and to charge one percent a month on loans, this holy and great synod judges that if any are found after this decision to receive interest by contract or to transact the business in any other way or to charge a flat rate of fifty percent or in general to devise any other contrivance for the sake of dishonorable gain, they shall be deposed from the clergy and their names struck from the roll.”


        An old debate, I’m afraid!

        1. F. Beard

          An old debate, I’m afraid! aet

          Common stock as money requires no fractional reserves, no usury and no intrinsically valuable money. Common stock money “shares” wealth and power rather than concentrates them. It is an ideal money solution.

          However, the common stock company was not invented till 1602 so it is no wonder that usury got a foothold instead.

    4. bob

      This is interesting. How do you “value” a church property? As soon as you foreclose, and a non-religous group owns it, it is now taxable. That would bring down the value of the property, and any chances of recovery for the bank. Seems like a perfect place for extend and pretend, honestly. Very illiquid market.

      I wonder about assesing the credit risk too. Is there a FICO score for religions?

      Bottom line, if god is so great, why is he always asking for money?

      1. F. Beard

        Bottom line, if god is so great, why is he always asking for money? bob

        Because He wishes to reward generosity?

        The generous man will be prosperous, and he who waters will himself be watered. Proverbs 11:25

        But generosity should not include payments to usurers!

        I would suggest that churches make it a policy NEVER to borrow even if that risks being priced out of the market by those who do borrow. God can and does provide. And of course, if we all decided to never borrow again (nor let our governments borrow) that would quickly destroy the usury and counterfeiting cartel. But that won’t happen because our money system creates a “Tragedy of the Commons” situation.

      2. different clue

        It isn’t god that’s asking for money. Its various human-staffed groups who are asking for money for themselves by invoking god. It reminds me of the country song: “Asking me for twenties with ten thousand on his arm”. It was about televangelists specifically.

      3. F. Beard

        It isn’t god that’s asking for money. Its various human-staffed groups who are asking for money for themselves by invoking god. different clue

        Actually, it is both but with different motivations.

        Anyway, “credit” is a curse disguised as a blessing; we pay interest for our own stolen purchasing power.

      4. Lidia

        Looking around at real estate, I came across a town whose Catholic church had recently moved from the small center (town has about 5000 residents total) and had constructed a new building on 5 acres outside of town. I pulled up the church news on the Google, and it told me that it had cost the parish $800k, with a $700k mortgage. They were asking for donations, natch. IIRC, the bulletin said that the archbishop had declined to assist the congregation in paying for this new edifice.

        The reason for needing a new church?

        Get this: not enough parking!!!

        $700k in debt for a PARKING LOT.

        Now, how many masses do they hold a week??

        TWO!! Two fucking masses!
        One on Saturday and one on Sunday.

        In the middle of Rome, my husband’s parish held at least 2 masses/day and something like 5 or 6 on Sunday. There was no parking lot.

        What a lazy priest… Yeesh.
        Have 5 masses on Sunday and have 20% of the parking issues… but noooo..

        What the hell will anybody DO with these kind of mega-structures when they’re foreclosed on? Small old-timey New England churches have been transformed into libraries, town halls, day-care centers or even private homes, but I don’t know what anyone could do with the larger monstrosities.

    5. The Other Lance

      There are so many churches in NC because all it takes to be a church in NC is pretty much to declare it so. That’s why every strip mall and every other street corner has a First Baptist Church of X or Reformed Freedom Church of the Lord Almighty in it or on it. We’re lousy with them.

  6. Tony

    The problem with the premise of the ‘God Bless America Trailer’ is that it reinforces the idea that you should hate someone based on how they are perceived the first time you see/meet them. So you end up with situations like the one with ‘Scumbag Steve’ where a guy and/or his family gets harassed based on a random Facebook picture.

    Excerpt: “Some asshole put up an ultrasound picture of my unborn kid and wished it would die. How fucked is that? My girl cried all night. She felt molested by that.”

    No, the movie I want to see is one where a lone, cold-blooded vigilante makes it his mission in life to assassinate the world’s worst criminals. The movie’s hero would watch top bankers (who, for example, might resemble the CEOs of JPM and Government Sachs), figure out their habits, and then set up camp in an abandoned building with a high-powered rifle and wait until just the right moment before blasting a hole in their heads.

    Unfortunately, Hollywood is gutless and they make a ‘light-hearted’ movie reinforcing the idea that it is OK to harass/intimidate/kill people who likely have the same problems as everyone else but came across as douchebags in a picture or on TV.

    Like it or not, movies do have an influence on people and, if someone is going to go postal anyway, they shouldn’t be encouraged to waste that on ordinary Joes/Janes. People that are going to go out in a blaze of glory should focus on trying to take some of the world’s worst criminals with them.

  7. Gil Gamesh

    “Banks Foreclosing on US Churches in Record Numbers”

    So that’s what Lloyd Blankfein (US Treas Sec, De Facto) meant.

    Well, the REO churches can reinforce the fundamental religious principle of this great, great country: God loves a rich man. You poor, go crawl away and die out-of-sight.

  8. Cal

    Our California governor is concerned with the plight of the less well off too.

    He is not concerned with the plight of men being discriminated against, nor is he interested in
    American families without money or their lack of housing and jobs.

    What he does seem to have an inordinate interest in is the poor children of Mexico and the rest of Central America.

    He worked for and signed a bill that is now law called the California Dream Act. It gives illegal alien youth that manage to sneak into and graduate from California high schools all the same student aid that the children of taxpayers that built the University of California, the California State University and the local community colleges
    are entitled to.

    In addition to race specific college admissions goals and preferences and private scholarship money this makes the schools an attractive magnet for those hoping to better themselves.

    He is of course putting fourth various new tax proposals to pay for this and other things like over half of California’s Medi-Cal clients being the children of illegals.

    Such generosity. And they say that charity begins at home!

  9. Lambert Strether

    The MFGlobal story is really unfair. I mean, a few hundred thousand dollars hardly qualifies as a “bonus.” It’s insultingly low. In fact, it’s more like a bad tip. What’s wrong with Freeh, anyhow?

  10. jsmith

    Regarding assasination:

    The propagandists have already won this battle.

    How do I know?

    Well, because America is having a “debate” about our leader having the right to murder citizens based upon his whims instead of screaming in the face of anyone who even dares support this treasonous horsesh*t:


    Once they get us to “debate” the issues, the point is already lost.

    Americans need to understand something:

    You don’t debate things that are black and white with propagandists. Period.

    You don’t discuss right or wrong with propagandists. Period.

    You tell them – politely or not – to STFU everytime they open their mouths until they stop trying to propagandize.

    Aggressive war is not debatable.

    Torture is not debatable.

    Apartheid is not debatable.

    The assassinations of citizens is not debatable.

    Indefintive detention is not debatable.

    Don’t even speak to them, don’t feel as if you have to justifty yourself or make your points.

    Just tell them to STFU any and every time they open their mouths.

    1. jsmith

      Not to belabor the point but people – Americans in particular – have to be very wary as the propagandists have grown so sophisticated.

      Americans need to find principled “red lines” which under no circumstances should be crossed and the debate of which should be immediately shut down.

      People forget that the US Constitution – especially the Bill of Rights – was created explicitly for this purpose:

      It was a collection of “red lines” the government couldn’t cross when governing citizens.

      Now, that the Constitution is just “a piece of paper” people are really on their own against the insidiousness of the elite and their propaganda system.

      Don’t engage in debates over issues that are clearly in violation of “red lines”.

      The elite are simply trying to normalize treason, murder and theft by making them debatable issues.

    2. Walter Wit Man

      You’re exactly right.

      Criminal warmongering fascists are running this country and have announced the new rules–arbitrary death and detention and torture and mass mind control.

      Notice the “liberals” who have made all this possible. As you note, even the liberals that seem to be opposed are part of the problem.

      There is only one valid response to the takeover of our government by fascists–to fight back.

      At the very least it involves refusing to participate in the crimes. That means if you are a Democrat and vote for ANY Democrat you are supporting fascist Nazi scumbuckets. Would you give the Nazi party donations? Why do you give money to the Democrats or MoveOn? You are just killing innocent people by propping up the organs of empire. When you vote Democrat you support the murder of children and the rape of this planet.

      Obama and ALL the criminal class need to be tried, convicted, and punished.

      Sure, let’s impeach him and his fascist thugs as well.

      Anything short of that is being complicit. These are criminal bullies and murderers. What makes you think you can reason with them? They are advanced mind fucking jedi murderers with the biggest weapons on the planet–their best weapon being a complicit media.

      The whining on liberal blogs (which is probably most of the blogs most people reading this blog read) is designed to HELP the fascist empire rather than oppose it. They are controlled opposition preventing us from seeing the full horror of our reality.

      I hope all the perps responsible for mass murder get justice. That includes those running interference on the internet. We are infested with criminal scumbags.

      1. Jim3981

        Hey Walter Wit Man,

        I hope we can agree it is both the donkeys and elephants making this possible.

        With the propaganda and election rigging we are kind of over a a barrel unless the main stream media can be declawed, money taken out of politics, and get Ron Paul put in there to stop what is going on.

        The USA is like a few years away from being like Greece if the secret societies(masters of deception) can’t be stopped.

        1. Walter Wit Man

          Yes indeed it’s both Donkeys and Elephants.

          Right now I’m more angry at the Democrats because I expected more of them and they tried to fool me.

          But the Republicans are just as culpable and deserve the same fate.

        2. LucyLulu

          Support for policies can be passive or active. The liberals condone policies passively in their silence and conservatives cry that we cross the red lines in the names of patriotism and protecting democracy.

        3. Lambert Strether

          That’s why I call the D/Rs “legacy parties.” They are a single system that has to go. They prop each other up. When one falls, both will fall. I don’t really care which goes first, the feral one or the sneaky one.

          1. Nathanael

            (a) The feral one is an easier target to shut down, right now;
            (b) if you shut down the sneaky one before the feral one, the feral one can make one HELL of a mess for a couple of years. Think Hitler.

    3. b.

      Man’s got a point. The intertubes in particular are about “debate” for debate’s sake. Digby has made a career out of re-parsing and re-litigating every single piece of repub BS, which sucks the oxygen out of any basic – or even equally ornamental – critique of democrat atrocities. Even Marcy Wheeler gets caught up primarily in contrived “gotcha” di-minutiative “investigations” – gardening in bonsai trees to better avoid acting on the forest.

      Same with all the “practical” objections against the Iraq invasion or torture. Ticking time-bombs? There is a red line in the sand, and you can take your expediency umbrella and shove it. Some acts are not justified even if they worked. This ain’t Shirley Jackson’s lottery, or LeGuins Omelas. Raping for prosperity is not a proposition “reasonable minds” can argue.

      1. different clue

        And of course liar Digby bans people in secret when they bring this up too effectively for her taste.

  11. polistra

    On bees: the distinction between sitters and rovers, or introverts and extroverts, is turning out to be a deep part of the natural design. It’s even showing up in one-celled microbes.

    So no need to feel guilt about killing bugs. We’re part of nature too, and we gotta eat. (Bees sometimes take revenge on us anyway!)

    1. aet

      The simple-minded Manicheans divide all that is into black and white, good or evil, extrovert or introvert.

      They mistake mental categories for substantial realities.

  12. YahwehJr

    On church foreclosures…

    Income levels of America’s major religious groups compared to the average U.S. income distribution.
    Over $100,000 per year:

    8% Black Christians
    9% of Jehovah’s Witnesses
    13% of Evangelicals
    16% Mormons
    16% Muslim
    18% National Average
    18% (Other)
    19% Unaffiliated
    19% Catholic
    21% Christian (Mainline)
    22% Buddhist
    23% Christian (other)
    28% Orthodox
    43% of Hindus
    46% of Jews

    1. LucyLulu

      In other headlines, William Bryan Jennings pleaded not-guilty today to charges in stabbing cabbie. Details from story today state that cabbie was trying to close open partition when Jennings stabbed his hand. They were driving around running red lights and with door open, looking for cop per the cabbie, returning to Manhattan per Jennings, when the stabbing took place.

      Morgan Stanley is going to have to hire a criminal attorney on a full time basis for their C-suite staff.

  13. Robeson's ghost

    When even the docile NAACP gives up on domestic remedies and goes to Geneva, that’s huge. Historically, NAACP got lots of money from the big 3 foundations because it gave up embarrassing and effective human rights appeals. For a long time NAACP held off on international shaming. They behaved because they were scared to be called commies. Even though the movement started out as two human rights petitions to the UN, An Appeal to the World and We Charge Genocide, US state propagandists deep-sixed the facts to disguise a global human rights movement as purely domestic “civil rights” with all the crucial international suasion airbrushed out. Now, as totalitarianism gets out of control, human rights is coming back. That’s good, because human rights law will call out this country’s institutionalized economic violence as an integral part of its forcible repression.

    1. TransitNeeded

      You do know that the Ford Foundation and others promoted
      integration so that Whites would flee the cities with their great public transist systems and move to the suburbs where they had to buy a car for each family member?

    2. LucyLulu

      It’s not the first time. After the Supreme Court ruled in 2005 that a woman was not entitled to have her order of protection enforced, she brought her case before an international human rights forum, who chided the US on its failure to protect women and children from domestic violence. The women’s three children had been killed by their father after he kidnapped them and police refused to respond to her repeated calls for help, including notifying police where he was keeping the children.

      1. robeson's ghost

        Wasn’t aware of that, thanks. I hope she pursues remedies per CCPR Article 2(3). One of the things this police state fears most is the universal human right to redress and compensation for domestic human rights abuses.

  14. Anonymous Jones

    When is someone going to finally discredit the “prisons are good” meme?

    I mean, think of all the costs! We put in all this money to house and feed and provide health care to *criminals* and we depreciate the value of the housing stock near the prisons we build, which lowers property tax revenue, which we need to build the prisons! We should just let all the murderers out! We can scold them instead of imprison them. That’s just as much of a consequence to their action, right? It’ll work out in the long run. No incentives will be altered.

    [snark obviously…or maybe not that obviously…huh, maybe the issue is slightly more subtle than breaking down foreclosure into an either/or with loaded, ambiguous terms like “good” and “bad”…naaaahhhhh…that’s crazy, AJ…just get back on your meds and say it’s “bad” like she wants you to…see, now you have me talking to myself…or maybe I always have been?]

  15. Jim A.

    I found the Firedoglake piece pretty irritating, personally. “What’s more, simple supply and demand dictates that throwing more vacant properties on the market when it’s already distressed doesn’t help anyone. In fact, it robs current homeowners of their equity. ” What about people who want to buy? Don’t lower prices help them? And robs them of equity? PLEEEESE. I would say that it forces people to realize that they paid too much. Which is irrelevenat if they don’t want to sell or refinance.

    And it makes the assumpton foreclosures automaticly lead to vacant homes. Look if banks want to limit supply and drag this whole process out in an attempt to minimize losses, leaving defaulters in the house is better than foreclosing and leaving the houses vacant. But you can’t assume that foreclosure is the cause of vacant homes. The cause is the bank’s unwillingness to accept the price that the market will pay.

    It completely fails to recognize that the real problem is that house skyrocketed to unafordable levels in the bubble, a fact that was masked only by poor underwriting and crazy loan terms.

    1. Yves Smith Post author

      Just because you want a bargain does NOT mean an overshoot on housing to the downside (which unnecessary foreclosures achieves, a lot of borrowers could be salvaged with mods) is a good thing.

    2. LucyLulu

      I’m not so sure Jim doesn’t have a point. How can we determine what the “true” value of homes are and what basis should be used to determine what they should be? The market has been too hopelessly distorted to rely on the usual supply and demand. We know there was a bubble but how much were prices inflated? Do we have a way of knowing? Based on charts published on ZeroHedge in the last 2-3 months, the median price of a home as a ratio of median household income is over 4:1 as compared to under 3:1 in the 1950’s and 1960’s. Is that a benchmark we might be working towards? (No, I don’t claim to know and I have equity in the home I own and so personally would prefer that home values not fall further.)

      1. Jim A.

        I would argure that there is no such thing as a “true” price. People spend too much time treating house prices by analogy to classical physics: “they went up, but now they’re falling down.” The real analogy is to quantum mechanics. They really don’t HAVE a price unless there’s a sale, similar to the way that a particle doesn’t have a position until a measurement (an “observation”) is made. In some cases you can make a pretty good prediction of what a house will sell for, but that’s really just an educated guess at best. There really isn’t some “true” price that actual prices deviate from.

        All other things being equal, a lower purchase price is good for the buyer and bad for the seller. For society as a whole though, what we want is more price stability than has been the case over the last decade. A round of high inflation in RE prices followd by rapid deflation has been the biggest symptom if not the cause of serious economic stress.

        1. Yves Smith Post author

          Have you been reading this blog? Your premise as to what is going on is all wet.

          First, if borrowers were dealing directly with lenders/investors, we’d see a ton of mods. That’s because it’s economically rational. If the borrower has reasonable income, a mod produces lower losses. The problem is that instead, we have cheatin’ servicers in the mix.

          Second, the result is we have an excessive number of foreclosures in process but those bizarrely are being attenuated so the servicers can earn even more in fees. So the overhang is really high. And they aren’t cooperating with short sales either, apparently again because they regard an FC as more profitable to them.

          1. Jim A.

            Oh, there’s no doubt that there is an agency problem. Especially when you consider that different bondholders have different interests. (tranche warfare) As well as the problem that the number of delinquent homeowners exceeds the capacity of servicers whose business models were predicated on very low margins.

            I’m not as sanguine as you are on how well mods work out in the long term. Certainly figuring out how to much principal reduction to grant is difficult. Too little, and the redefault rate will be high enough that there was little point going to the trouble. Too much, and they’re simply giving away bondholder money. (and those bondholders may sue) That redefault rate is key. In a rapidly falling market, it’s perfectly possible that allowing FBs to hold on for another year simply leads to greater losses when they STILL can’t make the payments and lose the house anyway, but after prices have fallen even further. And that decision requires the sort of analysis and judgement that has not been seen much during the bubble.

            I think that we’re in agreement that RE prices (and loan amounts) have to return to some sort of reasonable correlation with incomes. As I see it, there are four ways for this to happen:
            1.)A wage price spiral so that incomes rise enough that bubble-prices are affordable.–Not likely IMHO and probably too slow and uneven to help many who are having difficulty making payments right now.
            2.)Reductions in principal.* Difficult for the reasons noted above, but probably useful in marginal cases, especially in markets that are near bottom
            3.)Short sales. On balance, probably the best in many cases. The lenders really only have to make sure that the sale is an actual arms length transaction. The worry is that an FB will conduct a sale at a below market price to a confederate.
            4.)Foreclosure. The problems with this are as you and FDL have noted. And lenders should examine the marketability of the property BEFORE initiating a foreclosure action. There’s little reason to kick out people just to add an empty house to an inventory of REO that banks are holding onto. Foreclose to rent is possible, but servicers really aren’t set up for this. Traditionally, foreclosure is the default, but as you have amply pointed out, lenders have stupidly made it impossible to foreclose without committing fraud in a large, possibly a majority of cases.

            All told there aren’t any good ways out of this mess. It would have been much better and easier to not have gotten into this nightmare of high prices, unpayable loans, and oversupply.

            N.B. above, you implied that perhaps I was waiting to buy at a depressed price. On the contrary, I bought my house in ’99 and soon it will be paid off. Since I have no interest in selling or borrowing money secured by my house, the price of my house at any moment is of minimal direct interest.

            *because other mods don’t really change the fundamental dynamic of people who owe more than the house is worth. It doesn’t really matter how low your interest rate is, if you’re a year or two of income underwater, you should probably walk away from your mortgage.

  16. ep3

    re:Former New Jersey governor goes undercover as homeless man

    yves, this sounds more like a political hit operation against homeless shelters and SSI/disability/medicaid/etc.
    Those institutions needs funds to operate. As much as we all think we americans are so charitable that these places can operate without “assistance”, I suspect that their main source of funding is from gov’t support. So by this guy pointing out that the shelters “discriminate” because “they are greedy gov’t leeches”, he makes the shelters look bad. Especially in the state of New Jersey, where their current governor would ‘let them eat cat food’ rather than pay taxes, this would make excellent campaign fodder. Remember Acorn? They were doing a good service but were funded with gov’t money. All it took was two fake videos and they are broke. And don’t forget throw in a little “the white man gets discriminated while the “colors” get a free ride” racism, and homeless shelters get fully privatized or eliminated.
    If he wanted to seek more help for shelters, why use discrimination and gov’t funding as the bad guy?

      1. Wendy

        ITA. The thing is a travesty, part of the reason for which is the complete lack of disclosure of details. Now we are apparently finally slated to get some.

  17. G Booth

    It costs me never stab nor squirm
    To tread by chance upon a worm.
    “Aha, my little dear,” I say,
    “Your clan will pay me back one day.”

    Dorothy Parker

  18. Max424

    I kill spiders, flies and skeeters; but I don’t kill ants.

    I feel bad about the spiders –I really do (Charlotte, and all that). But the nasty bloodsuckers, and the noisy buzzers; they deserve to die.

    Do I occasionally kill an incorruptible mosquito, or a fly with a terrific personality? Apparently so.

    As the Canadian unBuddhist might say as he indiscriminately squashes his ancestors; “Sorry boot that, eh.”

    1. Max424

      I don’t kill American citizens. I especially don’t kill American citizens on American soil, without court or Congressional approval.

      Unless I think they’re really bad people. Then I blow them up –and everybody else in the vicinity– with a 500 pound laser guided munition, specially delivered by one of my Reaper drones.

      I harvest evildoers and remit them to the devil, to keep us safe. You can thank me in November, by voting for me.


      Barrack Obama

      President of the United Banks of America and Europe

  19. Valissa

    Greek debt swap triggers massive payouts

    In a test case for markets, the International Swaps and Derivatives Association, the derivatives trade body, announced there would be a pay-out, or credit event, for holders of credit default swaps.

    It means there will be a net pay-out of about $3bn on CDS contracts, according to the data warehouse Depository Trust & Clearing Corp, in a boost for the relatively new market in sovereign debt protection that could also benefit eurozone debt markets amid worries that a failure to trigger could have undermined an important hedging instrument for holding government bonds.

    However, there was a long delay over the decision by the ISDA determinations committee, which is made up of 15 global banks and investment funds, that annoyed some investors.

    Uncertainty still hangs over the CDS market as an auction process to decide the amount of pay-outs may not take place for another week.

    Bill Gross, who runs the world’s biggest private bond fund at Pimco, warned that CDS had been undermined by the saga. “The rules have been changed here,” he said in a radio interview. “The sanctity of their contracts is certainly lessened.”

    But Robert Pickel, chief executive of ISDA, said: “I think the CDS market will come out well from this because we stayed to the letter of the contracts. The key thing was that a credit event could not be triggered until it was binding on all holders of the bonds. It would have been premature to trigger a credit event before now.”

    1. Francois T

      Gee! Financial Times can’t bring themselves to give their readers the straight dope on CDSes, can’t they? Too many friends in the biz, I guess.

      Here’s another take that has the merit of being blunt and to the point:

      “The International Swaps and Derivatives Association said on Thursday that based on current evidence the Greek bailout would not prompt payments on the credit default swaps.”


      Here is a question for the crowd: Exactly how brain damaged, foolish and stupid must a trader be to ever buy one of these embarrassingly laughable instruments called derivatives?

      The claim that Greece has not defaulted — despite refusing to make good on their obligations in full or on time — is utterly laughable.

      In order to get paid on a default, you need a committee to evaluate whether or not failing to make payments is a — WTF?!? — default? Even more ridiculous, the committee is composed of biased, interested parties with positions in the aforementioned securities?

      ISDA: After this shitshow, why on earth would anyone EVER want to own an asset class that requires you to determine payout? Indeed, why should ANYONE ever buy a derivative again?

  20. Hugh

    Christine Lagarde was on Charlie Rose last night. I caught only a few seconds of it. I came in on Lagarde saying, “I have the best economists in the world with their models and regressions.” All I could think was how totally and deliberately clueless. Then I quickly changed the channel.

    I also saw I believe the beginning of the Obama mockumentary. It has Tom Hanks doing his best imitation sincere voice wondering “How is it that such a man could” walk among us and such, you know as if Obama were Lincoln or something. It was really retching type adulation.

    1. Hotel Schev

      How is it that such a man could walk among us after breaching Rome Statute Article 8.2.c.iv for the extrajudicial execution of Osama bin Laden when rendered hors de combat by detention – or the equivalent crime (murder of prisoners) under universal jurisdiction; Rome Statute Article 8.2.a.i for wilful killing of Abdul-Rahman al-Awlaki and hundreds of civilian drone murders in Pakistan, Yemen and Somalia – or the equivalent crime under universal jurisdiction; Rome Statute Article 5.1.d for use and threat of force against Pakistan and Iran in contravention of UN Charter Articles 48 and 51 – or the equivalent crime under universal jurisdiction; Rome Statute Article 5.1.d for aggression against Libya for overstepping the objectives of UNSCR 1973 (2011) as pretext to interfere with national self-determination in breach of UN Charter Article 2.4 – or the equivalent crime under universal jurisdiction… How is it that such a man could walk among us and not get carted off to captivity on a stick like Klaus Kinski in Aquirre Der Zorn Gottes?

      Every criminal dictator needs a personality cult.

    2. marie12

      I wonder if the Tom Hanks documentary will mention anything about the 168 children killed in Pakistan by Obama’s drone strikes.

      I didn’t think so. If Hanks had lived in Germany during the 1940s, he’d be the one literally walking over corpses in order ask: “how a man like Heinrich Himmler could walk among us”?

      People like that deserve to be shot.

  21. EmilianoZ

    An Atlantic Wire article about Matt Taibbi’s role in OWS mentions NC:

    “Max Berger, an Occupy organizer, said Taibbi was part of a contingent that included Naked Capitalism’s Yves Smith and the Roosevelt Institute’s Mike Konczal that kept up a “steady drumbeat” of coverage after financial crime faded from the headlines in the wake of the financial collapse in 2008 and the Dodd-Frank debates in 2010.”

    1. Yves Smith Post author

      I’m not part of any “contingent” that involves Taibbi or Konczal. I’m part of the Alternative Banking Group and neither has anything to do with it.

  22. LucyLulu

    OT but interesting. An LED lightbulb that lasts up to 22 years (4 hr/day) but costs (better sit down) $50.

    I’ve actually ended up buying a couple, primarily because I have some recessed lighting in a vaulted ceiling that I keep on probably 12 hours/day that is too high to access with a six foot ladder. To me, the extra up-front expense (recouped over time) is well-worth being able to avoid lots of aggravation every 2 years. My only worry is whether they will meet their claim. I have had CFL bulbs with claims of 7 year lives that have prematurely blown on me after only a few months.

    1. Nathanael

      Lucy, the crucial thing is having good house wiring. LEDs really dislike electricity with “dirty” waveforms. If you have good house wiring, they’ll last as long as advertised; if you have bad house wiring they’ll burn out much faster.

      1. different clue

        Does anyone make a “dirty-waveform cleaner” that can screw into a light socket and which an led-lamp can then be screwed?

  23. Francois T

    “MF Global Still Set to Pay Executive Bonuses ”

    Can’t wait to see how the fuckers will explain this one to the judges, when 1.6 billion have, according to the shills and the plants, “vaporized”.

    Of course, we know where the “vaporization” took place; in the vault of bandit extraordinaire JP Morgan.

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