Links 9/28/12

African spiny mice can regrow lost skin Nature

Scientists Invent Vanishing Electronics That Dissolve in the Body Medical Daily

Broker Sent Oil Prices to Eight Month High in a Drunken Stupor OilPrice

East Asia’s Patriots and Populists Project Syndicate

Europe’s Austerity Madness Paul Krugman, New York Times

PBOC liquidity is not a fix MacroBusiness

The Myth of Fixing the Libor Floyd Norris, New York Times

Social Security: Solidarity, Not Investment Common Dreams, Aquifer

Expensive To Be Poor: Expenses Twice as Much as Income for Bottom 20% of US Households David Dayen, Firedoglake

TSA Horror Stories Prompt Plan to Add Private Screeners Bloomberg. This is actually using unhappiness over TSA policies (which are not the front line workers’ doing) to go after the union. Read closely and you’ll see the artful efforts to present subcontractors as a solution to a completely different problem. Oh, and subcontractors are now “private screeners”. Really Orwellian, since “private screeners” in the headline led me to think the plan was to add more screeners for those who opt out of the new “look at you naked” scanning machines.

US farm drought hits growth Financial Times. Reader Scott notes:

The initial unemployment claims, which I think have been downwardly revised for more than a year’s worth of weeks consecutively, are a special case. Other data sets, right now, I’d tell you it’s because the initial number is arrived at with lots of estimations as part of the calculation, and as real data comes in to replace the estimated data, the revision occurs. During a period of economic contraction, the real data as it arrives is always worse than the estimates, because they’re based on the non-contractionary past, so the data gets revised down. I think it’s a sign that we’re heading into a recession. Frank Veneroso, on the other hand, published a short note today in which he said of the gdp that the downward revision was drought-related, and would itself be upwardly revised down the road.

Cyber Attacks on U.S. Banks Expose Computer Vulnerability Bloomberg

The house that meth broke Herald and News (Klamath Falls, Lisa E)

Analysis: Housing regulators loosen rules, but at what cost? Reuters (1 SK)

Traders Have A New Fear About How QE Won’t ‘Work’ Clusterstock. So much for the almighty “expectations channel.”

NAR Submits Letter to Bernanke on QE3 National Mortgage Professional News (1 SK). From earlier in the month, but still good as a contrary indicator.

Brussels steps up probe into CDS trading Financial Times

Restoring The Legitimacy Of The Federal Reserve Simon Johnson. IMHO this would be a start but is not sufficient.

Watch house prices, stupid, for US election risk Gillian Tett, Financial Times. Most people think their house is worth more than it will fetch on the market by a not trivial margin. This is true in good times and bad. And how much of a difference would even a 5% bump up make if you are 20% down or more from where you thought your house was, and your savings and spending patterns reflected your belief that you had real home equity? I’m not saying this is unimportant, I’m saying I think the impact of the cheerleading beyond the pundit and investor classes is overestimated.

The Rental Alternative to Foreclosure New York Times (Lisa E). Wish I had the time/energy to shred the framing of this article. It should go something more like: Dean Baker has been campaigning for this for five years. This is a sound idea. The banks are taking it only trivially (no doubt to generate nice “yeah we are doing something” headline). And why? It’s called INCENTIVES. Greedy servicers are not paid to do this so they pretty much don’t. And no one in policy land is even talking about fixing the servicing model.

Jorge Luis Borges and the Emerging Virtual Age Rick Bookstaber. Late to this, but this is still timely.

* * *

Mission elapsed time: T + 21 and counting*

I’m an artist, and if you give me a tuba I’ll bring you something out of it. –John Lennon

Montreal. Corruption: “Suits, cigars, and socks stuffed with cash. That’s the portrait of the Mafia that Montreal police officers are illustrating this week at the Charbonneau Commission into organized crime. Quebec’s corruption inquiry has promised to examine ties between organized crime, the construction industry and the world of political party financing.” Making the carré rouge all the more necessary and courageous.

Occupy. Right to peaceably assemble: “Associate Judge Thomas Donnelly ruled the October 2011 arrests were unconstitutional because the city routinely chooses not to enforce the curfew for events the city supports, such as the 2008 Election Night rally for President Barack Obama. … Police state: “UC to pay nearly $1 million in UC Davis pepper-spray settlement. The settlement also calls for UC Davis Chancellor Linda Katehi to write a formal apology to each of the students and alumni who were pepper-sprayed or arrested.” Mistakes were made?

AR. Legalization: “The AR Supreme Court on Thursday upheld a proposed ballot measure that, if successful, would make the state the first in the South to legalize medical marijuana.”

AZ. Food stamp diet: “Phoenix mayor attempts to live on a food stamp budget: ‘I’m tired, and it’s hard to focus.’

CA. On the docket: “A federal judge on Thursday determined [that Nakoula Basseley Nakoula] is a flight risk and ordered him detained. The hearing had an unusual wrinkle as the news media were banned from the courtroom where Nakoula was appearing, and reporters had to watch the proceedings on a TV in a different courthouse a couple blocks away. Court officials didn’t give a reason for the decision.” Hmm.

CT. More guns, please: “A man fatally shot a masked teenager in self-defense outside his neighbor’s house during what appeared to be an attempted late-night burglary and then discovered it was his son.” Of course, if the boy had had a gun…. 

FL. Corruption: “Sternad, who ran in the D primary against Garcia for a South FL congressional seat, admitted to the FBI that he was a stooge for incumbent R Rivera. Garcia is Rivera’s challenger on the November ballot.” Juicy detail at the link. … Corruption: “A Tampa real estate developer and an accountant with ties to U.S. Rep. Vern Buchanan pleaded guilty in federal court today for their roles in illegal contributions to the R Party of FL and Buchanan’s campaign, the Department of Justice announced.” … Corruption: “The Department of Economic Opportunity and its legacy agency have spent $750,000 to redesign its website, build a content management system and review its communications related to unemployment compensation over five contracts that were not competitively bid.”

IA. Early ballots: “During the 2000 general election, absentee ballots accounted for only about a quarter of Iowa Democrats and Republicans who participated. But in 2008, nearly half of the IA Ds who voted cast early ballots, whereas less than a third of Rs who participated cast early ballots.”

LA. Refineries: “The LA Bucket Brigade and seven other environmental groups filed suit against the EPA Thursday in an attempt to get the agency to limit air emissions of the most toxic, cancer-causing chemicals released by 150 oil refineries in 32 states, including 17 in LA.” … Times-Picauyune: The paper is running a super series on landfills. Kudos.

MA. Corruption: “The former state chemist accused of jeopardizing thousands of convictions by tampering with drug evidence admitted to investigators that for two or three years she cut corners at the now shuttered state drug lab by recording false positives and “a few times” adding known drugs to samples to produce the desired result.”

MI. Emergency managers: “Emergency managers begin by usurping the power of all elected officials or simply ‘firing’ them. They can then rewrite the public budget without any public participation, unilaterally eliminate various services, cancel contracts, seize and sell off public assets, privatize government functions, and dictate new laws. They can even dissolve a city’s charter. This isn’t merely un-democratic–it’s aggressively anti-democratic.” (EM timeline) … Deference: “Mayor Dave Bing halted a public district community meeting tonight after the audience became unruly and at times heckled him about issues including 12-hour shifts for Detroit Police and the proposal to lease Belle Isle to the state.”

NC. Universities: “The UNC Advisory Committee on Strategic Directions, a group that includes prominent right-wing political funders Art Pope and Fred Eshelman, heard presentations Wednesday about the state’s changing demographics, the need for more educated workers, and the state’s economic future. The Pope Center has an answer for the workforce problem too, advocating a few years ago that students be allowed to drop out of school at age 14 to enter the labor force. They not only openly advocate for fewer kids to go college, they seem to want fewer to finish high school.” 14? Why so late?

NJ. Foreclosures: “NJ has distributed less than $4 million of a $300 million grant, placing the Garden State in last place among states that have received grants from the Treasury’s Hardest Hit Fund.”

NY. Corruption: “The IG’s latest concludes that officials at the Kingsboro Psychiatric Center in Brooklyn failed to create discharge plans for patients before putting them on the street, and that a director at the facility ordered employees to fake records to make it seem as if that work had been done.” Well, it worked for Linda Green… Immigration: “While nearly two-thirds of deportation cases nationwide end in the target’s removal from the country, the results in New York City have been starkly different. Here, 74 percent of deportation proceedings this year have ended with the immigrant being allowed to stay in the United States. What’s more, over the last decade, the rate of New York City deportation proceedings that end with their subject being removed from the country has plummeted, down from 51 percent in 2002.” 

OH. Charters: “Preliminary data released by the OH Department of Education today indicate that while [charters] remove $771 million from traditional schools last year, they are generally getting worse results. And they cost the state about twice as much per pupil.” … Fracking: “[CONSOL Energy, the] first company that built the first-ever horizontal exploratory drilling well in to the Utica Shale said on Thursday that it has stopped work at the drilling site in Vienna and is ‘re-prioritizing’ their activity in the county. Little work has been done on the site on Warren-Sharon Road in Vienna since the Ohio EPA said slag runoff from the site killed numerous dead fish in a pond in Brookfield. The company did not elaborate on why work on the drilling site slowed.” Rule #1 violation?

PA. Charters: “But the Vitalistic Therapeutic Charter School in Bethlehem is a great example of the diversion of substantial school tax money to an institution that gathered students, operated without state oversight — and imploded. The school made improper payments to the families of employees and trustees, illegal loans and improper lease reimbursements totaling more than $630,000, according to a state audit report released recently.” Mission accomplished! … Charters: “But the Vitalistic Therapeutic Charter School in Bethlehem is a great example of the diversion of substantial school tax money to an institution that gathered students, operated without state oversight — and imploded. The school made improper payments to the families of employees and trustees, illegal loans and improper lease reimbursements totaling more than $630,000, according to a state audit report released recently.” Mission accomplished! … 

VA. UVa: “Alumni will be ‘regrettably [sic] but definitely asking each house of the General Assembly to reject Helen Dragas’ nomination to the Board of Visitors,’ Richard D. Marks of UVa Alumni for Responsible Corporate Governance told the four legislators who were at the [legislative town hall].”

WA. Unions: “Most [Boeing SPEEA union members] wore red union T-shirts and sported badges that said, ‘I’m voting NO.’ [Industry analyst] Hamilton forecasts a ‘landslide rejection’ Monday of management’s first offer.”

WI. Greens: “[Green Jonathon] Dedering says [D Brett] Hulsey has not been truthful in responding to questions about the disorderly conduct charge, in which he pleaded no contest to flipping a 9-year-old boy from his flotation device at Spring Harbor Beach on July 4. Hulsey later provided conflicting stories to the press and also charged it was a politically motivated complaint.” 

WY. Fracking: “A USGS report on its water testing of one [Encana] monitoring well near [Pavillion, WY] — where some residents complain that gas drilling and hydraulic fracturing contaminated their drinking supplies [i.e, groundwater]– identified levels of methane, ethane, diesel compounds and phenol, which the EPA had also identified in its report last year.”

Grand Bargain™-brand Cat Food watch. Divided government: “A record-high 38% of Americans prefer that the same party control the presidency and Congress, while a record-low 23% say it would be better if the president and Congress were from different parties and 33% say it doesn’t make any difference” (Gallup). If one party’s in power, a Grand Bargain is almost certain. Stalemate is better! (To put this another way, if the Ds truly wanted to make real “change,” they would have abolished the filibuster in 2009 using the “nuclear option.”) 

Fracking. Export: “How much should the U.S. spend on gas export infrastructure? If it sells its gas overseas, how much might future U.S. prices — for U.S. gas — rise as future South Korean prices fall?” (explainer). It’s thing to poison our water for our own gas; quite another to poison our water for export. Or not. … Regulation: “PA and OH each didn’t inspect 91% of active oil and gas wells in 2010, Washington-based Earthworks said today in a report. In NM, the top fine of $1,000 per day for violations has been in place for more than 75 years.” (PA official rebuttals.)

Voting. Provisional ballots: “New voting laws in key states could force a lot more voters to cast provisional ballots this election, delaying results in close races for days while election officials scrutinize ballots and campaigns wage legal battles over which ones should get counted” (explainer). … Partisanship: “There are 36 states in which elections are overseen by an elected, partisan secretary of state or lieutenant governor, according to the National Association of Secretaries of State. In another three states – Florida, Pennsylvania and Texas – partisan secretaries of state appointed by the governor oversee elections” (explainer). 

The trail. Toast indicator: “Soros is committing $1 million to Priorities USA Action, the ‘super PAC’ supporting Obama.” Everybody loves a winner! … Toast indicator: “with 40 days to go, we’re moving several toss-up states in the president’s direction. Our changes push Obama over the magic 270 mark, but we are not calling the race.” (Larry Saboto). Read for qualifiers. … Toast indicator: “There’s no point in putting it gently: Romney had one of his worst polling days of the year on Wednesday” (Nate Silver). … Lost cause: “[Respected congressional scholar Norman] Ornstein said in another couple of weeks, R independent Super Pac strategists such as Karl Rove ‘could decide that Romney is a lost cause and they’ve got to pour their money into House and Senate races instead of the presidential race.'” … Losing the political class: “Rs may soon lose a key talking point. According to data released Thursday, President Obama may now be a net job creator. In the year following Obama’s inauguration, the U.S. economy lost about 4.3 million jobs. But new figures released Thursday show 4.4 million jobs have been added back since then ” (CNNMoney). Buried: This doesn’t keep up with population growth. … Solnit’s hippie punching, a response: “Your elected officials never deserve your praise. The second you stop complaining and join in the cheerleading is the second democracy fails to function. Anyone who tells you different is an elitist apologist. End of story forever.”  

Robama vs. Obomney watch. Snark watch: “Pick up after your dog with Obama and Romney ‘Poopy Packs.'” (Taegan Goddard, usually so mild-mannered).

The Romney. Interview: ” Mary Aggers, 65, watched the biographical video before Romney’s campaign event in Bedford Heights, OH. ‘It shows an aspect of him that the press usually doesn’t bring out — they try to make him a stiff, wealthy, cardboard figure,’ she said. ‘But I like him because he’s not a politician.’” Dear Lord. Could the gaffes be the awesomest rope-a-dope strategy EVAH?! … Torture: “The Romney campaign document, obtained by The New York Times, is a five-page policy paper titled “Interrogation Techniques.” It was a near-final draft circulated last September among the Romney campaign’s “national security law subcommittee” for any further comments before it was to be submitted to Mr. Romney.” … Expectations game: “[In the debates, Obama will] use his ample rhetorical gifts and debating experience to one end: attacking Mitt Romney.” “He used sarcasm. He knew all the tricks, dramatic irony, metaphor, bathos, puns, parody, litotes and satire.”

The Obama. Student debt: “‘I want to make sure that everybody in America gets a great education,’ he said, suggesting the elimination of ‘middlemen’ in the student loan system to give money directly to students to help keep interest rates low.” OK, so why not single payer, then? … Teebee, 47%: “[A] brutal shot at Mitt Romney’s videotaped remarks about the freeloading 47 percent — it features nothing but audio of Romney’s own words, accompanied by pictures of veterans, workers, families with children, and other 47 percenters” (video). Brilliant and unchallenged D oppo is, to me, a key story of this campaign. Not only does nobody know who made the video, it was a crime to make it! That’s way better than Swift boating. … Teebee, 47%: “I’ve seen [the new 47% ad] numerous times on the air in Canton, [OH,] the seat of battleground Stark County.” … Teebee, 47%: Lord Eschaton puts the boot in. … Teebee, OFA: “[OBAMA: ] It’s time for a new economic patriotism, rooted in the belief that growing our economy begins with a strong, thriving middle class. Read my plan” (video). Fine, fix the foreclosure mess. Throw some banksters in jail. Apply Rule #1.

* Slogan of the day: Forging ahead courageously while following the great leader Mitt Romney!

* * *

Antidote du jour:

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  1. Bruce Post

    “The Obama. Student debt: “‘I want to make sure that everybody in America gets a great education,’ he said, suggesting the elimination of ‘middlemen’ in the student loan system to give money directly to students to help keep interest rates low.”

    What a bunch of BS by BO. He forgets the parent loan program or PLUS. Right now, the federal non-middleman is charging a fixed rate of 7.9%. Of course, with loans under the old middleman regime, some parents are paying a fixed interest rate of 8.5%. All these rates were and are set by Congress and signed into law by the President. Maybe I should incorporate myself as a bank and get some of the cheap, easy money from the Fed like all the other banksters.

    1. TK21

      “I want to make sure that everybody in America gets a great education” and yet he and his favor abolishing public education and teachers’ unions in favor of a corporatized charter school model.

  2. EconCCX

    Continuing our MMT discussion with Calgacus, whose most recent reply is here.

    EconCCX:Most importantly, banks can *buy things* with their reserves. While collectively regaining those reserves at the completion of the transaction.

    Calgacus: No, they can’t. (Collectively). The money just sloshes around the banking system, with the minor exception of cash, of course. To get it out of the system, a bank has to buy T-bonds = reserve drains. Or the reserves have to be used for taxes or purchases directly from, payments directly to, the government, paid out of a customer’s account. In either case, only payments to the government, and only in the second case do net financial assets change.

    NB. I said that banks can buy things with their reserves. Businesses, infrastructure, buildings, technology, TV ads and political favors. I did not say that those reserves then depart the banking system, but the very opposite. That’s the scam. Most everyone who receives that bank check or ETF deposits the proceeds into a bank. Whereupon the reserves (central bank money) immediately become the property of a financial institution, while the original payee gets that bank’s IOUs.

    Moreover, with the big 4 banks controlling north of 55% of deposits, they can easily arrange to regain their own reserves with many of these transactions. Individually, not just collectively. They do this by maintaining deposit accounts with each other. Mutually beneficial. You lay off of my reserves, and I’ll lay off of yours, and all our reserves are then leveraged. But a financial shock spreads to the extent that banks rely on other institutions’ IOUs in order to cling to their own reserves.

    How do you believe a bank purchases real-world capital assets for its own account, if not by disbursing its reserves, directly or indirectly?

    EconCCX: That’s the catastrophe of MMT. Coin seigniorage would give the Federal Government a fraction of one “spend” of $16T in reserves, whereupon these reserves would become the property of commercial banks, which would engage, with their depositors (holders of bank IOU money), in a bidding war for tollable infrastructure assets. This is the rentier disaster of which Hudson warns.

    Just self-quoting to reiterate. The sectoral balance identity describes a flow, but MMT proposes to raise the public’s share by altering a stock. That’s the essence of futility. Coin seigniorage bestows tens of trillions of reserves irredeemably to the private ownership of the banking system. As leveraged, high-powered money against which to collect interest, fees and rents. The community’s birthright for one mess of pottage. Bad deal, Cal. Fear the greenback, even if it’s a platinum coin.

    1. be'emet

      if first, end the fractional reserves, go to 100% reserves, (Kucinich’s NEED Act, bankster hocuspocus (recall this is mockLatin, we’re talking religion) the whole apparatus goes void. MMT should work with this.

      Why so much pre-occupation about complex debt and austerity, when we can shuffle it right off the board.

      1. Susan the other

        Agree. Private bankster monopolies have no place to be in capaitalism, private banksters have no place to be in sovereign finance, and once they are regulated and put in their proper place – totally ringfenced away from public expenditures, sovereign finance can navigate prudently forever. If the private monstrosities are not controlled we – the sovereign form of “we” – will have nothing and they will have nothing to steal. We’re all dead.

  3. Peasant Pinguin Society

    Alternate History Part Six: A Short History of Timisoara, wherein the journalists Taibbi, Baker and Solnit (T_BS for short) are duped into reporting a FAKE massacre as real.

    “But certainly for the present age, which prefers the sign to the thing signified, the copy to the original, representation to reality, the appearance to the essence… illusion only is sacred, truth profane. Nay, sacredness is held to be enhanced in proportion as truth decreases and illusion increases, so that the highest degree of illusion comes to be the highest degree of sacredness.” – Ludwig Feuerbach

    We begin in Timisoara. The first Timisoaran, named Vlach, lived in the Cave with Bones 36,000 years ago. Historians sometimes refer to Vlach as homer faber, or man the forger.

    During this time, the entire human race was divided into two species: one of giants, the other normal sized men.

    Civilization began with water. Once the giants became imbued with a sense of cleanliness as well as a fear of gods and of fathers, they shrunk down to our normal human size.

    It was perhaps for this reason that from “politeia”, which in Greek means civil government was derived the Latin “politus”, meaning clean or neat.

    After the collapse of the Roman Empire, Timisoara was ruled by Goths, Huns and Gepids before the Hungarian Conquest, at the beginning of the 10th century.

    In 1441 John Hunyadi became Count of Timisoara and transformed it into a military camp. Helped by Vlad Dracul Voivod of Wallachia (Count Dracula) he began his long campaign against the Muslim Ottoman Turks.

    During the anti-Ottoman war Timisoara was a strategic location in defending the southern border of the Hungarian Kingdom.

    In 1514 the largest peasants’ revolt in Hungarian history was defeated in a battle near Timisoara and its Sekler leader György Dózsa was tortured and executed.

    In 1884 Timisoara became the first mainland European city to be lit by electric street lamps. By this time, with the giants long gone and now become Legend, the polis was polished and civilization had become polite and policed.

    Timisoara’s population tripled between 1948 and 1992.

    In December 1989, Timișoara witnessed a series of mass street protests by Romanians, Hungarians and Serbs, in what has come to be known as the Romanian Revolution of 1989.

    The secret police of Timisoara conspired to overthrow the old regime, by attempting something even the Nazis had not dared to imagine: they brought together the Reichstag fire and Auschwitz in one terrible Event.

    For the first time in the history of humanity, corpses that had just been buried or lined up on the morgue’s tables were hastily exhumed and tortured in order to simulate, in front of video cameras, A FAKE MASSACRE, the genocide that gave an appearance of legitimacy to the new regime.

    This fake massacre was legitimized as true by the entire world media. and even highly regarded journalists, such as the reporting trio Taibbi, Baker and Solnit (T_BS) were taken in by the STAGED event.

    This was a turning point in history, and from here it was only a short step to a media and consumer society *entirely* organized around the consumption of false images, commodities, and staged events.

    So it should be clear by now that the true is nothing more than a moment within the necessary movement of the false.

    In this way, truth and falsity became indistinguishable from each other and the spectacle legitimized itself solely through the spectacle.

    Here Endeth Alternate History Part Five

    Footnote: The fake Timisoara massacre is based on a real event, a performance art work staged by the secret police of Timisoara (in Dec. 1989) for the benefit of the world media.

    Disclaimer: Alternate history is a genre of fiction consisting of stories that are set in worlds in which history has diverged from the actual history of the world. This is a work of fiction. Names, characters, businesses, organizations, places, events and incidents either are the product of the author’s imagination or are used fictitiously. Any resemblance to actual persons, living or dead, events, or locales is entirely coincidental.

    1. Peasant Pinguin Society

      One of my sponsors just called and told me I’d better include a Happy End to that story. Or else!

      And so here it is.


      “Today the revolutionary project stands accused before the tribunal of history – accused of having failed, of having engendered a new alienation. This amounts to recognizing that the ruling society has proved capable of defending itself, on all levels of reality, much better than revolutionaries expected. Not that it has become more tolerable. Revolution has to be reinvented, that’s all.” Internationale Situationniste #6 (August 1991)

    2. ZygmuntFraud

      In reality, today’s Alternate History installment brought me to a whole new Constellation …

      In that Constellation, the President’s native language is Thai, and he’s a fan of the French “OuLiPo” movement (small, outlandish movement) in French “litterature”. OuLiPo is some sort of acronym for: “L’Ouvroir de littérature potentielle”; they take word-play to a whole new level:

      1. Peasant Pinguin Society

        Yes, ZygmuntFraud, some of Oulipo’s methods were employed in this story.

        But it’s not as crazy as it sounds: on the one hand, here we are in 2012 and the “Timisoara Syndrome” is alive and well in places like Libya, Syria, with the Western media still using fake massacre stories to promote their agenda.

        Plus it seems like there was a co-ordinated effort on the parts of Taibbi, Kevin Baker, Rebecca Solnit and others to dupe their readers into buying the same old lesser-evil, vote for Obama argument. The same argument these same writers seemed to discredit in the past. Once the election is over, they’ll probably go back to their old style of writing in order to win back any readers they might have alienated, at least until the next election, and so forth…

        In short, reality is stranger than fiction, even the strangest fiction.

        “In Bucharest later that day, Ceausescu condemned the commanders and demanded that demonstrators be mowed down a la Tiananmen Square. At nightfall, troops opened fire on the crowds. The army massacre continued into the night. Reports at the time estimated that between 4,000 and 10,000 had murdered which drew much sympathy and support for the demonstrators.

        Later official counts show that 97 people were killed.”

        1. Peasant Pinguin Society

          Thanks, that’s one link to the fake Timisoara massacre I hadn’t seen yet.

          I especially liked this line:

          “Il faut apprendre à se méfier de la télévision et des images qui nous sont présentées. »

          1. Ms G

            “Il faut apprendre à se méfier de la télévision et des images qui nous sont présentées. » (Le Monde Diplo, 1990)

            Et oui. C’est tellement simple. Et pourtant . . .

    3. Susan the other

      Bookstaber. Looks like Borges was a pinguid soul. I think I tried to read him a couple of times, but he wasn’t nearly as amusing as you PPS. And not to forget my favorite philosopher Chuang Tze (of whom I know nothing but this quote): “I dreamed I was a butterfly flitting around in the sky; then I awoke. Now I wonder: Am I a man who dreamed of being a butterfly or am I a butterfly dreaming I am a man?” Ancient wisdom c. 400 bce. I think the world has always been virtual.

      1. Peasant Pinguin Society

        Thanks, Susan!

        Even as I pressed the submit button on the post above, I wondered if this is really the most appropriate venue for these stories…

        As for the world always being virtual….I’m not so sure it’s always been virtual, but certainly in a media saturated world it’s hard to get close to the reality of a thing or event buried underneath layer upon layer of images. At that point, it becomes almost impossible to distinguish between the reality and the representation….

        1. ZygmuntFraud

          Hello PPS,
          In my life experience, it’s always the case that I feel most confident about who I’m interacting with in face-to-face, private or semi-private meetings where I can see and hear the other person, be it John or Debby …
          I seem to remember reading that a lot of visual processing activity and “neurons” somewhere in the brain are dedicated to facial recognition. With facial recognition and remembering someone’s voice, it’s like I feel I “absolutely” know who’s next to me. Phone is inferior for authentication, email further down, and so on.

        2. Robin Hood

          I have to admit I’m confused.

          First Taibbi revealed to us, in your media outlet “Rolling Stone Magazine”, that based on extensive interviews with Buffy The Vampire Slayer, there are Vampires in California.

          Now he appears to be telling us he was incorrect about that and there are no Vampires anywhere, and even if there were, Obama would have or did vanquish them (by the speaking of appropriate Curses – the Holy Cross thing is too Republican, The Bernank doesn’t use Silver Bullets, and no one thought of Tally Sticks), tho he first picked their pockets for campaign financing.

          See my confusion?

          1. Ms G

            “tho he first picked their pockets for campaign financing.”

            … thus proving that, after all, Obama is in fact a vampire slayer or, better yet, a Robin Hood disguised as a Vampire.

            Many of us share your puzzlement. Until you pull back the lens and the Frame of Mono-Party Kleptocracy with its Lackey Team of “progressive” (roach motel) journalists comes into full focus. Then it all kind of makes sense. And causes one to press the pause button next time one gets excited that there IS someone out there telling it like it is.

            Going back to read CJ Sansom books. Today’s story happening in the distant past, told by an author who’s meal ticket does not depend on reeling in pesky potential voters.

          2. Peasant Pinguin Society

            Robin Hood,

            I share your confusion, but it looks like Ms G already answered this one better than I could.

        3. Romolo

          I’ve wondered this myself.

          Late in the afternoon, while dozing lightly, especially after drinking coffee or tea, sitting up in a cafe, trying to keep my eyes open, or, lying in bed trying to get to sleep at night, I experience a shadow world, a parallel world, a coherent world of concepts and concretized emotion that are undescribable using language. Problems and situations that create their own reality. This language just can’t describe it.

          Is it the right hemisphere talking to the left and Vice versa? I had a serious head injury as a child.
          Anybody else share this kind of thing?

          1. Aquifer

            The dream world …

            Or, as they say, the best things cannot be said, the second are misunderstood and the rest is conversation …

  4. fresno dan

    Watch house prices, stupid, for US election risk Gillian Tett, Financial Times

    There is an implicit bias in the media for cheer – even somebody like Tett whom I believe is pretty good is not immune. If the world was to end for certain, you would get articles on the positive aspects, e.g., no longer have to diet!
    If articles simply put 20 year graphs pertinent to the issue in every story, it would cut 99% percent of the baloney put out by industry shills.

  5. MacCruiskeen

    “Oh, and subcontractors are now “private screeners”. Really Orwellian, since “private screeners” in the headline led me to think the plan was to add more screeners for those who opt out of the new “look at you naked” scanning machines.”

    It’s Orwellian because the headline didn’t mean what you hoped it would mean, even though it appears to be a not entirely inaccurate description of what the article is about? Please, no.

    “Orwellian” is definitely another overplayed rhetorical gambit.

    1. Yves Smith Post author

      No, you really need to bone up on how propaganda works, and how using nice Madison Avenue labels dulls readers to what is going on. Like “entitlement reform” rather than “having old people die faster”.

      First, the “private screeners” was Bloomberg picking up on the terminology used by the promoters of this scheme. You imply they devised this expression when they didn’t. I’m pointing out the propagandizing was so effective it got into the headline.

      Second, what it is the big beef about the TSA? INVASION OF PRIVACY. So the “private screeners” is a simply brilliant expression that puts the subcontractors in the association box that people who hate the TSA would resonate with.

      By contrast, do you see the charter schools described as “private schools”? Or Blackwater (what is it called now, I think they’ve undergone 2 name changes to distance themselves from their profiteering in Iraq) as “private soldiers”?

      1. skippy

        “private soldiers” – YS

        Cough…. Security Associate[s

        skippy.. Ohh the day when folks still admitted that it was mercenary[s. O’yeah I sure its all kosher, requirements of Article 47 of Protocol I to the Geneva Conventions, they are exempt under clauses 47(a)(c)(d)(e)&(f), … they swear… pinky promise…

  6. William

    On that CT shooting, I’m astounded at the level to which “journalism” has fallen. Since when do newspapers state events in such a story as fact? Who said the boy had a “shiny weapon?” Probably the shooter, but a statement like that needs to be attributed. And stating that it was a “weapon” is conjecture.

    The article starts out saying it was in “self-defense.” How can a newspaper decide this? This is not a fact, yet it is presented as one. It should read, “The shooter claimed self-defense.”

    I’m also amazed how readily the commenters at the N.O. paper leaped to the exact conclusions and reactions the newspaper apparently hoped they would.

    Half the comments were in support of the shooter. I wonder how many of them as teenagers stayed out too late and sneaked back into the house? I did many times, and yes, sometimes through a window. But people are so easily brainwashed by the gun lobby and right wing talkers they can’t think for themselves anymore.

  7. Ned Ludd

    Surveillance – without warrants – by federal law enforcement agencies has skyrocketed under the Obama administration.

    During that same time period [2009-2011], the number of people whose telephones were the subject of pen register and trap and trace surveillance more than tripled. In fact, more people were subjected to pen register and trap and trace surveillance in the past two years than in the entire previous decade.

    Internet surveillance is also way up: authorizations “to use these devices on individuals’ email and network data increased 361% between 2009 and 2011.” Given Obama’s track record, “four more years” sounds increasingly ominous.

  8. beau coup

    Nobody knows who made the video? Let’s think it through, guided by the axiom that the only significant pluralism in America is between contending kleptocratic elites. Obama lost the banks to Romney. But he had an ace in the hole. From the outset Obama gave the spooks and death merchants everything they wanted. They turned him into a blood-spattered Chucky puppet of torture, aggression, and extrajudicial killing, and now they’re installing him for a second term of fun and games. Domestic intelligence assets made that tape. CIA agents of influence played the Wurlitzer. Just like in Ecuador but easier, no need for Plan B.

  9. Aquifer

    Squirrel –

    “Please, don’t shoot – see, I’m not hiding any nuts!”

    “OK, pat me down, I ain’t goin’ through that damn machine again” (“rats, why couldn’t i have been a flying squirrel ..”)

    1. Susan the other

      Remarkable hands. They have opposable thumbs too, but short. And they are notorious thieves, bold and successful. Nature’s banksters.

    2. Valissa

      After the squirrel completed the last maneuver of his/her balance beam routine, the audience went wild and the judges awarded him a 9.9!

  10. LeeAnne

    CT. More guns, please …

    If we are to trust the article (a stretch, I know) the kid disguised himself with the intention to rob his neighbor. Ironic justice, no?

    50,000 a year are killed in US traffic accidents.

  11. jsmith

    From Krugman:

    “the truly irrational players here are the allegedly serious politicians and officials demanding ever more pain.”

    Someone must comment on this form of propaganda EVERY TIME it appears so here goes:

    This is NOT elite irrationality, Paul, you sycophantic propagandist assw!pe.

    Just as the Iraq War, the WOT and the events of 9/11 CANNOT be chalked up to – shucks – elite ignorance/incompetence at this stage of the game you cannot in a logical world deem what the elite in the Western world vis a vis austerity are doing is the result of some sort of bumbling foolishness.

    They have made a choice – us or them – and they have chosen themselves OVER AND OVER AND OVER AGAIN, Paul!!!

    Gee, I wonder if the “irrational” rulers will allow this “crisis” to get to the point that the masses will be “overjoyed” at the idea of another Central Bank to lord it over all of their lives – huh, Paul?

    “…it should let the European Central Bank do what’s necessary to rescue the debtor nations”

    No, the only truly irrational people are the billions of people who have been murdered and stolen from for decades who haven’t realized YET who is responsible for said murder and theft, Paul.

    And then when the masses DO finally realize who to lock up etc., why, you’ll be there to call them an irrational mob I’m sure, eh, Paulie?

    Digusting and pathetic.

    1. Valissa

      Thanks for reading and dissecting Krugman so I don’t have to. I haven’t bothered reading his column for the last year or so. Nothing new to learn there, and his propaganda lacks wit or flair.

    2. Peasant Pinguin Society

      Taibbi? put a little cross

      Harpers / Kevin Baker? put a little cross

      Rebecca Solnit? put a little cross

      Krugman? put a little cross

      Hey, maybe now I’ll have time to work on my chip shot!

        1. Susan the other

          I think Gore Vidal pointed it out in blunt sentences that we were only interested in southern China, the Shan States, because of their mineral riches. And the UK still seems to be dependent on Honk Kong probably for contraband and financial alchemy, but who knows what else. Wonder what Sheldon Adelson’s role is in this mix.

      1. Ms G

        The little “x”s mark the headstones in the growing graveyard of tainted “journalists.”

        Working on the chip shot will definitely bring you to a more real layer of reality — dirt, grass, your hands on the club, real physical impact (club-putt), breathing real air and seeing real clouds. (I know you did not mean practicing chip shots on a game boy.)

        Thank you Peter Pinguid, as always, for today’s contribution.

        1. Ms G

          Ms G: “The little “x”s mark the headstones in the growing graveyard of tainted “journalists.”

          Yes, soon we’ll need a new graveyard, this one’s running out of space!

          As one who provides Major Funding to PPS, would you prefer the next story to be:

          1. a more traditional story in which Larry Summers gets killed by Mongolian Horsewomen


          2. a more experimental story (similar to the history of Timisoara) , and dealing with issues of propaganda, simulations, fake news, tainted journalists, etc

          1. Peasant Pinguin Society

            Sorry, Ms G, the above question was supposed to be from
            Peasant Pinguin Society to Ms G, but I typed your name in the Name (required) by mistake.

          2. Ms G

            That “name” in the “Name” device is very Oulipo.

            To answer your question, P. Pinguid. If I thought you had all the time in the world I would immediately say “both, please”! But that is a lot to ask of you, and I am kind and empathetic supporter of the Pinguid Chronicles, and want you to continue without burning out. So . . . for the next one, I would like to read the story about Summers’s fate at the hands of the Mongolian Horsewomen. It will be a nice change, given the flurry of fake-flag-news in recent days, to read a good old-fashioned, straight-shooting, told-as-it-is, account.

            That’s my wish. Write as you will.

            Ms. G

    3. Susan the other

      Also jsmith, it is an intentional distraction to use the phrase “rescue debtor nations.” That is what Der Spiegel has recently been trying to do – call this debt “sovereign debt.” But both are an oxymoron of the first degree because there can be no sovereign debt unless there is sovereign wealth. And sovereign wealth rights were signed away when Spain, Greece, Italy et. al. signed the Maastricht Treaty, otherwise known as a contract. It lacks all mutuality. They signed away not just their civil rights, but their national rights. It is an absurd situation. And no court in the world can “make them pay” under these circumstances.

  12. joebhed

    On Simon Johnson attempt to attach legitimacy to ANY Fed policy.
    The legitimacy is in the ‘mission-statement’ of the Fed.
    The tragedy is working with an impotent system to achieve the mission.

    If ANYONE wants to know the way out of this mess, a couple of researchers at the IMF have handily pointed it out.

    The Chicago Plan Revisited
    Please have a read, Simon, friends and others.
    The problem is not the Fed.
    The problem is the debt-based system of money.
    This from the IMF researchers – OF COURSE, not from the IMF.

    For the Money System Common

      1. joebhed

        Yes, Susan, I am sure you are right about that.
        But even among the IMF intelligentsia, there must come the question when pondering how to achieve what is needed – what are the options?.
        So the Chicago Plan and its successors should be up for a reconsideration.
        Author Kumhof has designed the IMF’s modern macro-economic model, and in the Chicago Plan study he used standard classical-economics methodology.
        It will be very difficult to deny his conclusions.
        I just heard Dr. Kumhof present this paper at the American Monetary Institute conference.
        The more people that know about, sooner, the better.

  13. MyLessThanPrimeBeef

    Electronics dissovling in the body.

    Before I start on that diet, how many calories are we talking about?

    Will I gain weight if I start dissolving iToys in my body?

    1. Ms G

      Unclear. But your bloodstream will be emitting data to the Big Data Vault in Utah at rates beyond our ability to count!

  14. be'emet

    I froth at the Lesser Evil Equivalency. Most often, good is better than best. benevolence > malevolence, there’s a difference. Idealism brings inquisition, better work to win cooperation than to trash the nation. We’re up against real sociopathy, folks.

    1. Ned Ludd

      By “real sociopathy”, do you include the current occupant of the White House? He has committed “mass murder”. His Justice Department has subjected more people to warrantless “pen register and trap and trace surveillance in the past two years than in the entire previous decade.” And, as Matt Stoller pointed out:

      In the transition from Bush to Obama, inequality got worse, faster, than under the transition from Clinton to Bush. Obama accelerated the growth of inequality.

    2. Aquifer

      Co-operate with sociopathy? Hmmm, seems to me we’ve been doing that for some time now, and it ain’t workin’ out too well …

  15. MyLessThanPrimeBeef

    Regrow lost skin…

    Same thickness or if you are thin-skinned now, you can become thick-skinned, sort of like adding a few MPH after a Tommy John surgery?

    Still, they say once you’ve lost face, you can’t re-grow it. But that seems harsh though, especially on yourself.

    Hopefully, you don’t lose heart, for there is always hope, which cures lost hearts.

  16. Valissa

    re: Cyber Attacks on US Banks

    This is the part that concerns me…
    The U.S. Senate last month failed to advance comprehensive cybersecurity legislation and the administration is contemplating using the executive order because it’s not certain that Congress can pass a cybersecurity bill, the officials said.

    Comprehensive cybersecurity legislation… authoritarian solutions… Toto we’re not in Kansas anymore (and haven’t been for longer than we knew… ahhh the sweet of illusion of democracy is hard to let go of).

    While I was researching the subject I came across this interesting article…
    Why Rockefeller’s cybersecurity bill is going straight to top CEOs

    Also this one from the Electronic Frontier Foundation on the why the bill failed to pass …
    Victory Over Cyber Spying

      1. Ms G

        Good one. Drop it in “comments” next time a pundit (cough, journalist) trots out the tropes of Obama’s “incompetence” or “obstructed by Republicans.”

        Adding. The handy Executive Order comes out of the same bag of magic solutions as the Fed Window “Facility” (where banks, but not us, can borrow at 0%). Amazing, the arrows available in That quiver.

    1. ZygmuntFraud

      This is not a secret:> F.A.I.S.R.T.W.H. by Cheswick & Bellovin: one of the great classics in computer security, I’d say.

  17. Valissa

    re: Restoring The Legitimacy Of The Federal Reserve

    Maybe I just have Orwell on the brain these days, but the title of that post makes it sound like a public relations solution is needed (remember ‘public relations’ is the pleasant sounding meme that replaced the word propaganda).

    “If the right and the left were ever to come together on this issue, they might enact legal changes that would reduce the independence of the Federal Reserve, making it more subject to Congressional pressures.”

    Then this line from Johnson “The megabanks, naturally, are opposed” cracked me up.

    Looking at the 3 players in this game as (1)Federal Reserve, (2)megabanks, (3)politicians/lawmakers… who has the least power? The politicians, of course. How is there ever going to be a legislation that disempowers those who are really in power?

    At first glance Johnson seems to be writing like the typical naïve idealistic college professor he now is. But this is the guy who wrote “Quiet Coup” and was once the chief economist of the IMF. Surely he knows how the behind the scenes money games work. I have to wonder who the target audience for this post is.

    An oldie but goodie (perhaps where Taibbi got his vampire squid metaphor)

    Here’s another great old cartoon
    from the cartoon “Golden Rule: Nominate the most progressive candidate who will secretly bargain with us.”

    Things haven’t changed much in a hundred years.

    1. Valissa

      Some backstory on why it says National Reserve Association instead of Federal Reserve on the squid (the term private syndicate is the key here)… but of course the term Federal Reserve makes it sound like it’s part of the government.

      From the Wikipedia article on the Federal Reserve Act
      The Plan called for the establishment of a National Reserve Association with 15 regional district branches and 46 geographically dispersed directors primarily from the banking profession. The Reserve Association would make emergency loans to member banks, print money, and act as the fiscal agent for the U.S. government. State and nationally chartered banks would have the option of subscribing to specified stock in their local association branch. It is generally believed that the outline of the Plan had been formulated in a secret meeting on Jekyll Island in November 1910, which Aldrich and other well connected financiers attended.

      Since the Aldrich Plan essentially gave full control of this system to private bankers, there was strong opposition to it from rural and western states because of fears that it would become a tool of certain rich and powerful financiers in New York City, referred to as the “Money Trust”.

      1. EconCCX

        Valissa, it’s an article of faith among MMTers that the Central Bank is subordinate to the elected government, and can even alter balances in central bank accounts at a keystroke. For example, Billy Mitchell writes:

        >>The currency units used for the payment of taxes are consumed (destroyed) in the process of payment. Given the national government can issue paper currency units or accounting information at the central bank at will, tax payments do not provide the state with any additional capacity (reflux) to spend.<<

        The consolidated government – treasury and central bank | Bill Mitchell – billy blog.

        But the private ownership structure of the Federal Reserve Banks makes such balance manipulation impossible. The corporate entity is institutionally distinct from the USG, notwithstanding the fig leaf of public input in its governance, and the prohibition against owners’ trading their shares.

        MMT is a wish-fulfillment fantasy of how the financial system operates.

        1. Valissa

          it’s an article of faith among MMTers that the Central Bank is subordinate to the elected government … MMT is a wish-fulfillment fantasy of how the financial system operates

          Yeah, that’s why I have little interest in MMT. Lots of great ideas and theories avidly discussed by intelligent people, but little connection to the real world of power and money dynamics IMO. They always gloss over the minor little detail of how the state money transition is going to happen.. ya know… like from what we have now… without some sort of huge power struggle… deus ex machine perhaps?

          1. Bert_S

            Then the winning God Machine gets to decide were all that money gets “spent into existence”.

            Nothing the Chinese can’t handle, but even so….

          2. Bert_S

            Not to say the Western World won’t get there by accident.

            At some point they will say, “We have no choice. There is NO WAY OUT. Better Red than Dead”

            And delete all history of the Founding Fathers and the birth of a Real Democracy – complete with Limitations on Power and Checks and Balances on The System.

          3. Bert_S

            And since you so rudely stuck the Feral Reserve Bank back into my consciousness today, after successfully banning it from my thoughts for a full half day, I feel compelled to make a little comment on that.

            I think it may be best to make the Fed independent of both Congress and the banking system. They have been modified occasionally as Congress sees fit since their inception back in 1913. One mod was adding the “full employment mandate” and I think that happened back in the late 70s or 80s (I don’t feel like looking it up). If we take that away, then Congress has to perform fiscal matters again (War or Butter being one thing we haven’t heard in a while.)

            That leaves the Fed with the official mandate of stable money – and they have enough trouble with that.

            Then they are the “backstop” of last resort for the banking system – sort of like a Super FDIC with a printing press. There has been plenty of discussion here and everywhere else how that could be improved. Now they could strike the Fear Of God into a banksters heart pump if they would backstop the TBTFs like the FDIC does. Like, yes we do that but you are now closed and fired. Or possibly nationalized until cleaned up and then IPO’d as a utility bank, or whatever . (providing a little short term cash in emergencies where no foul play is evident would be OK. But what we just had is Not OK.)

        2. Yves Smith Post author

          The shares held by banks are preferred shares, not common. They do not confer ownership. And Fed “profits” are swept to the Treasury, not the banks that hold preferred shares.

          The regional Fed board meetings do not resemble board meetings. The regional Fed boards, for instance, could not fire a regional Fed president. Nor do they discuss succession, staff promotions, pending discrimination suits, executive pay levels, any of the governance stuff a normal board of directors would do. They do I believe nominate the next regional Fed when one leaves office, but my recollection is that is subject to the approval of the board of governors.

          So it is erroneous to say the Fed is private. It is more accurate to say it has an unusual and arguably seriously inadequate governance structure.

          1. EconCCX

            >>So it is erroneous to say the Fed is private. @Yves

            From the Federal Reserve Act:

            After all necessary expenses of a Federal reserve bank have been paid or provided for, the stockholders of the bank shall be entitled to receive an annual dividend of 6 percent on paid-in capital stock. …The entitlement to dividends under subparagraph (A) shall be cumulative.

            Should a Federal reserve bank be dissolved or go into liquidation, any surplus remaining, after the payment of all debts, dividend requirements as hereinbefore provided, and the par value of the stock, shall be paid to and become the property of the United States and shall be similarly applied.

            FRB: Federal Reserve Act: Section 7.

            Dividends. Stockholders. Liquidation. Par value of the stock. This is a blatantly private institution, to my reading. The very term “The Fed” is propagandistic, meant to elide the distinction between the Board and the Banks.

            So there’s hybrid governance. But tell me this. By the rod of MMT, and Bill Mitchell’s notion of consolidated government, is the bank not sufficiently, technically, lawfully private that when each era’s populists and neochartalists declare that the elected government can change its book entries, the law can respond, looky here: Not USG’s bank. Not USG’s money. Those debt instruments the bank holds are USG-owed, not owned. And the monetarily sovereign nominal government is beholden to the private money power to the end of time.

            All very neatly taken care of before our foremothers even had the vote.

            What sayest thou MMT proponents?

  18. dilbert dogbert

    “The house that meth broke Herald and News (Klamath Falls, Lisa E)

    Something about this story does not add up. I evicted a tenant and was worried that he might have been cooking or doing and wanted a clean bill of health on the house so had it tested. Null result.
    Got some educational materials about meth and meth labs. Seems if even if they cook but do not contaminate the house with precurser materials a wipe down with simple green does the de-contam job. If they only use the story is the same, just a wipe down is all that is required.
    The owner of my testing agency said even if they only used, the residue could be found in adjacent apartments where there was no use. The testing is damn sensitive.
    Contamination with the chemicals is another story. Now you have a superfund site.

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