Links 2/4/13

Australia dolphins ‘saved’ by juvenile’s distress call BBC

Close encounters with polar bears in the frozen Alaskan wilderness Telegraph. Nice photo series

Richard III: unveiling day arrives for skeleton that would be king Guardian (Carol B)

Stowaway Killer TB Travels Globe Fueling Screening Sales Bloomberg

Mining the Web to Predict Future Events Microsoft (Slashdot). Eeek. Microsoft is putting itself in charge of pyschohistory.

US Carbon Emissions Fall to Lowest Level Since 1994 OilPrice. This is CO2. What about soot and methane? But we also have this: Why has US Oil Consumption Steadily Fallen since 2004? OilPrice

Harvard professor has it right: U.S. climate push requires intense grassroots support around ‘cap-and-dividend’ bill Grist (Carol B)

IMF sees 140m jobs shortage in aging China as ‘Lewis Point’ hits Ambrose Evans-Pritchard, Telegraph. So if we workers can hold out seven years, the labor market might start firming up?

Foxconn plans Chinese union vote Financial Times.

Flood fatigue hits QLD fundraiser MacroBusiness

Police spies stole identities of dead children Guardian (JohnL)

The eurozone crisis is not finished Wolfgang Munchau, Financial Times. Astute point re the OMT killing bank reform.

Europe’s Sham Banking Union Sony Kapoor and Charles Goodheart Wall Street Journal

Twin crises in Italy and Spain stalk markets as political unrest prevails Telegraph

Wars That Aren’t Meant to Be Won David Swanson, Firedoglake

Why Police Lie Under Oath New York Times (Francois T)

Super Bowl Is Single Largest Human Trafficking Incident In U.S.: Attorney General Huffington Post (Carol B)

POWER OUTAGE STOPS SUPER BOWL FOR 34 MINUTES Associated Press. When I went to New Orleans three years ago, it was clear it was the future of America: visible poverty and decaying infrastructure. And this is yet another sign the US is firmly in third world territory. Please name a similar level screw up (with so many ad dollars at stake!) for the single biggest sporting event in a first world country. I can only hope the rest of the US carries our decline off with as much character and good humor as the Big Easy.

Former Navy Seal sniper Chris Kyle shot dead at Texas gun range Guardian

People Are Convinced That Washington Is About To Make One Of Its Biggest Blunders Since The Financial Crisis Clusterstock. Had a conversation with a DC insider on Sunday. He confirms there has been absolutely no motion for the last two weeks. I said it looked like we were going to hit the sequester and he agreed. Now everyone in investor-land seems to be taking the view that this will all be averted or any sequester will be so short as to not hurt very much. But if there is so little anxiety about this that official DC has sat on its hands for two weeks, how much success do you think they will have in reaching agreement in five (four weeks to the sequester plus the theoretical “see that was not so bad” short sequester?)

Fun Fades at Investing Clubs Wall Street Journal

This is going to end badly Tim Price

No Bear Market for Treasuries Seen After January Decline Bloomberg

Low Rates Force Companies to Pour Cash Into Pensions Wall Street Journal. So more money goes into the financial economy rather than the real economy. Charming.

NYC Foreclosures Up 19% Barry Ritholtz

Friends of Fraud Paul Krugman, New York Times

US pension funds sue BlackRock Financial Times. Ooh, this is gonna be FUN! Although BlackRock will clearly lawyer up to its teeth on this one.

Macroeconomics and the financial cycle: Hamlet without the Prince? Claudio Borio, VoxEU

Antidote du jour (furzy mouse):

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  1. Jose Guilherme

    “The noted Nobel Prize winning economist Hyman Minsky…” – Tim Price

    Well, he sure didn’t get the Nobel.

    And Mr. Price should perhaps do a bit of google searching before writing pieces on a supposedly impending doom.


    1. Roger Bigod

      There is no “Nobel Prize in Economics”. There’s a prize set up by a Swedish bank with the intention of passing it off as a “Nobel Prize”. Someone should have told them that it’s unbecoming for banks to engage in counterfeiting.

      And as you pointed out, Minsky didn’t win it.

    2. slim

      Price appears to be quoting Doug Wakefield about Minsky, albeit, one set of quotes has disappeared.

      Perhaps he lost it in the market.

  2. Simon

    Hi Yves,

    I’m really sorry, but the Super Bowl is really not the “the single biggest sporting event in a first world country”. That’s a US myth :)

      1. Doug Terpstra

        Sex slavery and violence in the coliseum casino — bread and circuses in the NeoRoman empire. Surreal, disgusting and nauseating. It’s hardly better than the infamous Taliban soccer stadium. The gods must be crazy.

    1. Yves Smith Post author

      It is most decidedly the biggest sporting event in the US. Or are you disputing that the US is “a first world country”?

      The statement is correct as written.

      1. Thor's Hammer

        I was always under the impression that Bush & Rummy’s Shock & Awe bombing of Baghdad was the largest carnival and sporting event in America’s history. The expenditure dwarfs the Super Bowl, and the halftime fireworks were much more impressive.

      1. CB

        But there are lots of slipped schedules. Which allowed me the real pleasure of seeing Ann Richards considerable talents as a (extemporaneous) raconteur when she filled in about 45 minutes of Bill Clinton’s scheduled time at a Texas rally. Has a national candidate ever appeared just on time?

    2. neorealist

      From the strictly American First World perspective, it is. The FIFA World Cup is probably the biggest sporting event once one is outside of the USA. To many Americans, Soccer is European/South American Hooligan S**t and the Americans who like it are wanna be Europeans.

      1. Yves Smith Post author


        Can you please go back and PARSE WHAT I WROTE?!?!

        The Super Bowl is the biggest sporting event in the US. The US is a first world country.

        So the challenge is to name a similar level fuckup in the biggest sporting event in ANOTHER first world country.

        This is why I have to unpack articles all the time. People are so used to skimming and multitasking that no one seems to read sentences any more.

  3. Jim Haygood

    Barron’s hits a new low in what passes for financial journalism:



    In October, we predicted the Dow would pass its 14,165 record by early this year. Now we’re just 1% short.

    ‘Dewey beats Truman,’ in other words. It hasn’t even happened yet. If this risible, chest-pounding headline sounds like it was written by a 14-year-old braggart, it probably was.

    Nailing market forecasts is for newbies. Professionals decide on their asset allocations and stick to them. The Yale Investment Office, headed by David Swensen, is a good example of this disciplined process:

    If you take investment advice from the Mainstream Media — who reliably scream ‘BUY’ at the top and ‘SELL’ at the bottom — you will lose all your money.

    Dumping all MSM subscriptions is Job #1. Don’t feed the retarded beast.

    1. Jim Haygood

      p.s. The Bloomberg headline ‘No Bear Market for Treasuries Seen After January Decline’ (linked above) is another example of a gratuitous media prediction.

      The Treasury market don’t care what they think.

    2. Bill the Psychologist

      JH, thanks much for your sage advice. I read the financial/market blogs every day, but I can’t hear this advice too many times, particularly put so succinctly.

      1. MyLessThanPrimeBeef

        Good advice indeed.

        I have one to offer myself – I believe we should follow the FAA model and make it mandatory that every bankster wear a blackbox with him/her all the time.

        That way, after a market crash, we know exactly what happened (prosecution is another matter).

  4. Gladys (Peter Pinguid's ex-secretary)

    Gladys’ Job Search (from the Pinguin Chronicles)

    Gladys here, Peter Pinguid’s ex-secretary.

    Saturday I applied for a job at Longchamp’s on 151 W 34th St (1st floor of the Macy’s building). The job description said cleaning the windows and doors, dusting the shelves and mirrors, picking up trash throughout the store and replacing trash can liners, then sweeping and mopping in the common area and stockroom at least twice a week.

    The good part: no need to clean bathrooms and no kitchen. The bad part: I’d have to start at 7:00 AM, including weekends and holidays. Commuting from the Bronx, that’s too early. I decided to look closer to home.

    There was a job opening at Sure-Rooter Drain & Sewer Cleaning, so I started to apply, but part of their drug testing required someone watch me p*ss into a bottle. Fugetaboutit !

    Next I heard there’s a job opening over at the Suds a Lot Laundromat on White Plains Rd., so I started walking in that general direction.

    On the way I fell into a spiral of panic; I’m already unemployed in my fifties, yet still living with my mother in a tiny cramped apartment in the Bronx. As if that isn’t bad enough, now Naked Capitalism commenters tell me there’s no god.

    I looked at the person walking in front of me, as if they were a figure in some kind of Bosch haunted landscape (including bears hung on trees, cadavers floating in rivers, burning ships, brutal robbers, gallows, wolves eating people, cripples, etc)

    Perhaps that’s all any of us are, anyway, just figures in a Bosch landscape. In each era, new figures come, others go, like a mirage. So what is this pointless dance we’re engaged in, this dance where we whirl together in an endless circle, locked in the illusion that we’re going somewhere, that what we do has meaning beyond our own day-to-day survival? At any moment any one of us could disappear from this place and nothing would change, nothing of consequence.

    This thought brings on a rush of vertigo, a dizzying sense of disorientation, as if I’m about to fall, but when I fall I’ll be weightless.

    Finally I pull myself together and arrive at Suds a Lot laundromat for my job interview. The manager, who turns out to be a 300 pound man named Spider (with multiple tattoos and piercings), is wearing a T-shirt (about three sizes too small for him) that says “Who The F*ck IS Kanye West?”

    He seemed like a nice enough guy however the job interview did not go well.

    Monday I’ll apply at the Burger Hut on Devoe St, then Jimbo’s Hamburger Palace before heading over to the McDonald’s on E Tremont Ave.

    I am Gladys, I am the 99 percent.

    1. ambrit

      Dear Gladys;
      Come on, buck up woman! As PPs secretary, didn’t you *ahem* aquire certain incriminating documents etc. during your tenure? Don’t you have copies of his daily itinerary? As in, who he met and talked to, and when? His financial statements? Pull yourself together! You’re a walking WMD as far as he and his friends are concerned. Seek out one of his ‘competetors’ and offer your services. If the elites can do so well with “Divide and conquer” over the ages, so can you! Be an “Information Entrepenuer!”
      BTW, “a tiny cramped apartment in the Bronx.” Huh? With your talents, you should be living on Riverside drive!

    2. Gladys (Peter Pinguid's ex-secretary)

      Thanks Ambrit,

      Yes, I have incriminating documents on the Pinguid Society. And they’re very well hidden (not in the apartment), with specific instructions in case something happens to me.

      But who could I give them to that’s not owned by the 0.01 percent? The New York Times? Adam Davidson? Matt Yglesias? don’t make me laugh….

      And if I do that, I’ll need to disappear under the Witness Protection program, but can I trust the NYPD?

      1. ambrit

        Dear Gladys;
        I’ve just returned from another day at community ser, uh, work, and caught up. Even the .01% has factions and cliques. Appeal to certain ‘Middle Eastern’ elites, and you could well end up retiring to the Cote dAzure. (Mom could have her own apartment over the garage where you keep the tasteful and refined Citroen.) Don’t limit yourself to the North East U.S. Besides, you don’t have to give it all away. Certain interesting portions of the information could still reside in hibernation.
        We’re all pulling for you!

  5. skippy

    Is furzy mouse channeling Richard Smith these days… for antidote du jour submisions?

    Skippy… foreboding methinks

    1. F. Beard

      So you think that bear is just tasting his next meal?

      Being a cynic is its own punishment, I reckon.

      1. skippy

        Cynicism is the resulting effect from suffering – too many lies – in ones life, an – environmental condition – that is *created* rather than intrinsic to the natural back ground.

        Skippy… the question is, is it mom, or, a suitor considering the legacy of his bloodline… in a free market world – environment…. would the real savage please stand up!

  6. Brindle

    I guess I don’t see an American who is part of an invasion of another country and goes on to kill 150 people there, a good thing .
    The fact that his particular mode of killing required some skill does reduce the probability that he was a sociopath or worse.

    —“Kyle drew criticism for drawing attention to his exploits by writing about the 150 insurgents he had killed between 1999 and 2009. The book, American Sniper: The Autobiography of the Most Lethal Sniper in US Military History, became a bestseller.”—

    1. the cockroach scuttle

      Kyle’s brand of retail murder is the wave of the future. Remember how the CIA’s senate clowns whacked Hillary with pig bladders until she bugged out her eyes in cartoonish hammy dudgeon for the cameras? To Republican dupes, it was a drama of diplomatic incompetence by Dems. To Democratic dupes, it was Republican posturing.

      It was all an act to hide criminal aggression by CIA officials: the sending by or on behalf of a State of armed bands, groups, irregulars or mercenaries (8 bis 2.g) manifestly contrary to international law and provisions of the UN charter (Article 2 Sections 1, 4, 7) prohibiting interference in the internal affairs of sovereign states.

      This sort of congressional puppet show is the Covert Service’s response to closing loopholes in international criminal law: illegal US wars will increasingly be surreptitious and furtive. Congress is afraid to declare these wars. The Commander in Chief is afraid to command them. The career criminals of the Clandestine Service will wage these wars bei Nacht und Nebel with drone targeteers, snipers, and death sqads. Everyone knows that exposing these criminals is the best way to cripple the US aggression industry.

      For every Kiriakou there are a dozen foreign counterparts who can blow the whistle on the individual murderers. Oh, you think you have a gentleman’s agreement? Bandar Bush had one… We shall see what happens now that you’re beyond the pale.

      1. AbyNormal

        daaang Lambert, i left that place feelin bound n nakeeed

        There are many things worth living for, a few things worth dying for, and nothing worth killing for.

    2. Yves Smith Post author

      Not the reason for my interest. Would not have linked to it except it’s ironic in light of the current debate re gun control.

      1. cwaltz

        If a sniper trained by the SEALS leaving a gun range was taken off guard by another person with a gun then it certainly stands to reason that even with a the ability to shoot to defend yourself that there is still an element of luck involved in determining whether or not you leave an encounter with another person who has a gun alive.

        Of course, without that ability the chance would be equally abysmal.

        I’d really love to see numbers on how many times owning a gun actually worked to someone’s benefit. We have numbers on how many times it was a deficit, I can’t understand why there isn’t equal information availiable on gun owners able to defend themselves from predators.

  7. from Mexico

    @ “Why has US Oil Consumption Steadily Fallen since 2004?” OilPrice

    There’s some great research in that article, but Tverberg nevertheless gives what I believe to be misleading answers to a couple of important questions:

    1) Was the decline in oil consumption caused by high oil prices, or by the GFC?
    2) Was the GFC caused by high oil prices, or by other factors?

    Regarding question #1, Tverberg states that the “drop in consumption is no doubt related to a rise in oil prices starting about 2004.” However, later she cites evidence that seems to argue against this conclusion:

    the vast majority of the savings seem to come from (1) continued shrinkage of US industrial activity, (2) a reduction in vehicle miles traveled, and (3) recessionary influences (likely related to high oil prices) on businesses, leading to job layoffs and less fuel use.

    I find it ironical that when it comes to China, where reliable information regarding the level of economic activity is hard to come by, energy usage is often cited as a gauge of economic activity. But when it comes to the US, this correlation doesn’t seem to exist. The decline in energy consumption is no longer due to decreased economic activity, but high energy prices.

    That brings us to question #2. Tverberg implies that the GFC was caused by high oil prices. And this feeds into question #1. If high oil prices were not the proximate cause of the decline in consumption, then they were the ultimate cause.

    But there are competing explanations for what caused the GFC. These revolve around failures of the finance industry, the blowing and bursting of an unprecedented private debt bubble and the concomitant bursting of a bubble in asset prices, including residential real estate prices.

    A look back to the 1970s and 1980s might be instructive, since this is the only time when a decline in oil consumption came on the heels of a big run-up in prices. But again the picture gets foggy. Was the decline in oil consumption caused by the high prices, or by the sharp downturn in economic activity in 1980 to 1982? Was the 1980 – 1982 recession caused by high oil prices, or by Paul Voklers’ Great Monetarist Experiment and his exorbitant interest rates?

  8. Keenan

    RE Superbowl power outage:

    With the game at 28 -6 last night when the dome darkened, I recall the late “Dandy” Don Meredith, broadcasting for ABC Monday Night Football, singing “Turn out the lights…. the party’s over” when the score became lopsided.

    Don, if you arranged to flip the switch from somewhere beyond the veil, you were a little early.

    1. Lambert Strether

      I thought the whole spectacle was shoddy and second second-rate, with the exception of the Digital FX (if I have the argot right) which were superb. Play-by-play was poor and analysis was non-existent. All in all, a fine example of the devolution phenomenon Yves is always on about. One could, I imagine, see the crowd doing the wave during the power outage as an example of bearing up cheerfully under adversity, but one might also see it as whistling in the dark (rather like electoral politics).

  9. Manofsteel11

    Mining the Web to Predict Future Events– there are a number of companies already doing this in various ways, from news analysis to trading info. Related capabilities are improving, and growing in terms of business relevance.
    There is still a huge gap when it comes to translating predictive info into decision-making-focused knowledge. In other words, it’s still mostly about ontology and not epistemology.

  10. jpmist

    “Low Rates Force Companies to Pour Cash Into Pensions Wall Street Journal. So more money goes into the financial economy rather than the real economy. Charming.”

    WTF? Unseemly for you to snark at corporations funding defined benefit pensions promised their employees. Given how little corps pay in Federal Income Tax it’s unseemly for them to gripe about how the Fed’s Zero Interest Rate Policy is hurting them, as well as all savers and retiree’s.

    1. Yves Smith Post author

      Pension underfunding is a long standing problem. Go look at the stats on it. And THEN go look at how long big companies have been net savers in the US and how much cash they have. See here for details:

      They’d find it a lot easier to fund those pensions (which are legacy items for the most part) if they had not been disinvesting on a sustained basis. This is not a function of crisis aftermath, it started in the last expansion.

  11. Lambert Strether

    Clearly, all the personnel at the gun range where the Navy Seal got shot needed to be armed. And if they were armed, they needed to be more heavily armed. Because the answer to any problem with guns is always “More guns!”

    1. AFCT washout

      What a dumb dead fuck. Treat a guy with PTSD to a day on the firing range. What were they going to do next, visit a slaughterhouse? Take him to see Black Hawk Down? Behavior mod 101: when you flood a guy, don’t give him lethal weapons.

      1. KFritz

        Hear! Hear! Firearms are not the right therapy for angry, disturbed people. Duh. Only in a gun-crazy society, detached fr/ common sense would pointing this out be necessary!

        The mother of the Connecticut shooter told the baby-sitter to be careful of him when he was nine years old!

        Yet she still taught him to use firearms. She is more culpable than anyone for the deaths of the kids. Knowing her son to be unstable and potentially dangerous, she needed to keep the weapons under the tightest control and security. It didn’t happen, and the rest is history.

        Guns + mental illness = lots of damage.

      1. zygmuntFRAUDbernier

        It looks to me like the shooter (the killer) was a good guy until in the blink of an eye he turned into a bad guy …

        1. KFritz

          Please read my other comment (just above). Whether he was a nice guy most of the time, the killer was disturbed and unstable at least some of the time. Not a candidate for participatory firearms therapy.

  12. rich

    Breaking the Chains of Debt Peonage

    Debt peonage is a familiar form of political control. And today it is used by banks and corporate financiers to enslave not only individuals but also cities, municipalities, states and the federal government. As the economist Michael Hudson points out, the steady rise in interest rates, coupled with declining public revenues, has become a way to extract the last bits of capital from citizens as well as government. Once individuals, or states or federal agencies, cannot pay their bills—and for many Americans this often means medical bills—assets are sold to corporations or seized. Public land, property and infrastructure, along with pension plans, are privatized. Individuals are pushed out of their homes and into financial and personal distress.

    Debt peonage is a fundamental tool for control. This debt peonage must be broken if we are going to build a mass movement to paralyze systems of corporate power. And the most effective weapon we have to liberate ourselves as well as the 30 million Americans who make up the working poor is a sustained movement to raise the minimum wage nationally to at least $11 an hour. Most of these 30 million low-wage workers are women and people of color. They and their families struggle at a subsistence level and play one lender off another to survive. By raising their wages we raise not only the quality of their lives but we increase their capacity for personal and political power. We break one of the most important shackles used by the corporate state to prevent organized resistance.

    1. MyLessThanPrimeBeef

      There are a few ways to make up for wage stagnation – debt or Lotto.

      For me, the solution is not by raising the minimum wage, but through GDP sharing.

      With that, we will have no need of Lotto anmore.

      1. different clue

        In the meantime, if one can convince more people of raising the minimum wage than of instituting GDP sharing, there is a better chance of getting minimum wage rise than of getting GDP sharing for now. So raising the mininum wage would be helpful to people at or barely above minimum wage in the meantime.

        1. MyLessThanPrimeBeef

          I think there is a counter-argument that like the lottery, aspirin pills and bread and circuses, it diverts our attention from GDP sharing.

          1. different clue

            I suppose . . .

            Since I am not impressed with that counter-argument myself, I will support raising the minimum wage whenever the opportunity arises.

  13. dragqueencapitalism

    “Only One Earth”: the US, or more specifically, the Americas, were once, and botanically, still are, referred to as the New World; Europe, the Old World. Then Marx and Lenin decided that perhaps the idea of siphoning the output of millions of workers to a small, divinely appointed elite was perhaps a less that ideal plan, and we divided the world, post WW2 into the first world: Capitalist paradigm of alternating orgies of destructive creation and creative destruction, the 2’nd world, consisitng of the Central-Planning states of Communistic Russia and China, and the third world, basically, the ROW (Rest of the World, not a global nap), consisting of what were referred to as the non-aligned, hopelessly impoverished nations, the allegiance of which was the prize sought by the then 1’st and 2’nd worlds.

    After the dissolution of the USSR, and the genesis of China into a Totalitarian export platform to produce the consumables for the Consumerist-based US economy, the preferred nomenclature became ‘Developed’ vs ‘Developing’ countries. This distinction is still used today, despite the fact that the 2’nd largest, and arguably, most productive, economy on the planet is China, although still inexplicably ensconced on the ‘Developing’ side of the equation.

    So when you state that the “the Super Bowl is really (or not) “the single biggest sporting event in a first world country”, what exactly are you talking about?

    1. MyLessThanPrimeBeef

      They have the Rose Bowl, the Orange Bowl, the Citrus Bowl, etc.

      Why not combine them into one giant Salad Bowl? That could be bigger than the World Cup.

  14. craazyman

    Crises, Wars, Shams, Foreclosures, Outages and Lies

    Yep, the links are roaring with bearish glee today. Even Hussman came through this morning with a blast of hellfire for the bulls. Gotta breath a big sigh of relief and stick to the guns. This is no time to lose nerve and panic with a huge buy order on margin. At least not until around 3:30 if discipline fails. Hopefully restraint will be the watchword until after 4.

    1. Jim Haygood

      Dr. Hussman is a former professor. One can learn a lot about finance from his weekly column.

      But he is also a master at creating elaborate rationales (expressed as arrays of improbably specific, ever-changing mathematical rules) for staying bearish no matter what. In academia, it’s called ‘data snooping.’

      In the past four years, the S&P 500 doubled while he stayed hedged with puts which relentlessly decay in time value.

      One of these days he will be right — the market is not cheap. But something is terribly wrong with an approach which can spend four years on the wrong side of the market.

      1. craazyman

        You’re tellin me!

        he’s had me under his spell for a year or more.

        I’m already so risk averse it’s immobilizing me, and he just eggs it on.

        I don’t know how I’m going to get rich quick unless somebody hands me the money. The scratch off $1 lottery tickets don’t pay more than $50 bucks. And I don’t win that often anyway.

        1. MyLessThanPrimeBeef

          I am lucky in that I can’t afford to retire to Paris in a few decades, at least, and so, I have all that time to break even in my Hussman fund.

          1. MyLessThanPrimeBeef

            In the meantime, the Lotto is looking more and more attractive, or actually necessary, where for every dream-come-truer, you get millions of victims.

  15. Twonine

    Cantwell-Collins is back apparently.

    From 2009
    “As U.S. climate legislation creeps forward, Senators now have two frameworks to choose from. One is from Sens. John Kerry (D-Mass.), Joseph Lieberman (I-Conn.) and Lindsey Graham (R-S.C.); the other is from Sens. Maria Cantwell (D-Wash.) and Susan Collins (R-Maine).”

    From David Morris:

  16. barrisj

    Meanwhile, another despatch from the cyberwarfare front:

    Broad Powers Seen for Obama in Cyberstrikes


    WASHINGTON — A secret legal review on the use of America’s growing arsenal of cyberweapons has concluded that President Obama has the broad power to order a pre-emptive strike if the United States detects credible evidence of a major digital attack looming from abroad, according to officials involved in the review.

    That decision is among several reached in recent months as the administration moves, in the next few weeks, to approve the nation’s first rules for how the military can defend, or retaliate, against a major cyberattack. New policies will also govern how the intelligence agencies can carry out searches of faraway computer networks for signs of potential attacks on the United States and, if the president approves, attack adversaries by injecting them with destructive code — even if there is no declared war.

    The rules will be highly classified, just as those governing drone strikes have been closely held. John O. Brennan, Mr. Obama’s chief counterterrorism adviser and his nominee to run the Central Intelligence Agency, played a central role in developing the administration’s policies regarding both drones and cyberwarfare, the two newest and most politically sensitive weapons in the American arsenal.
    Mr. Obama is known to have approved the use of cyberweapons only once, early in his presidency, when he ordered an escalating series of cyberattacks against Iran’s nuclear enrichment facilities. The operation was code-named Olympic Games, and while it began inside the Pentagon under President George W. Bush, it was quickly taken over by the National Security Agency, the largest of the intelligence agencies, under the president’s authority to conduct covert action.
    International law allows any nation to defend itself from threats, and the United States has applied that concept to conduct pre-emptive attacks.
    During the attacks on Iran’s facilities, which the United States never acknowledged, Mr. Obama insisted that cyberweapons be targeted narrowly, so that they did not affect hospitals or power supplies. Mr. Obama frequently voiced concerns that America’s use of cyberweapons could be used by others as justification for attacks on the United States. The American effort was exposed when the cyberweapon leaked out of the Iranian enrichment center that was attacked, and the “Stuxnet” code replicated millions of times on the Internet.


    Once again, exploiting the “pre-emptive doctrine” developed by Cheney-Bush (“The one percent solution”), Obama and his national security minions have escalated this pernicious bit of American exceptionalism to include attacks on other countries’ computer networks and control centers, actions in and of themselves would be deemed “acts of war” if
    directed against the US
    , or even “potentially directed”.
    By this doctrine, virtually any activity performed by a country declared “hostile to US interests” would qualify as a casus belli, and would invite an immediate visit from a US goon squad, either via drones, JSOC assassination teams, or massive cyberattacks. If there ever was a country that was subjected to arguably blatant “acts of war” (by the Americans’ own definitions, yet!), it is Iran, and seemingly without any recourse or redress short of committing national suicide by actually countering these acts of sabotage and murder.
    The tools first developed to an aggressive art by Cheney-Bush, we now can see quite clearly, can and will be exploited by successive US administrations in furtherance of imperial ambitions and “national security”, and there is nothing that anyone or any international body can do about it. “Pre-emptive action/war” and torture, both severely constrained or explicitly forbidden respectively by the Geneva Conventions of War are now routinely violated by the US, and the international community has to accept nolens volens the actions of a rogue state, full stop.

    1. Expat

      And we know that “national security,” “national interest,” etc., in the mouths of the president does not mean the 99% or even the people who voted for him. It’s the security of the usual suspects, whose interests are opposed to those of the vast American public.

      1. zygmuntFRAUDbernier

        Psy-Ops was documented by the late CovertAction Quarterly; one must always be on guard for propaganda …

  17. Zachary Smith

    *** Former Navy Seal sniper Chris Kyle shot dead at Texas gun range ***

    The early news reports didn’t have much information, but among the other places I looked for information was at Amazon – Kye wrote a book. Most of the 1-star reviews were “respectful”, but they were also savage.

    So based on what I read there and elsewhere, I’m going to bet one or both of the dead men said something to the killer which set him off. Something the mentally damaged young veteran felt to be a mortal insult.

    As for the two links about the Super Bowl and the the one about TB, I really don’t trust myself to make any coherent comments – not right now.

  18. Eureka Springs

    Krugman finally pulls out the F word… yet it’s used in such a limited petty manner that one wonders if he’s trying to weaken it like Karl Rove would.

    1. jsmith

      Meanwhile back here in Israel…I mean the United States:

      From Glenn Greenwald:

      NYC Officials Threaten Funding of College Over Israel Event

      On Saturday, I wrote about the numerous New York City officials (including multiple members of the US House of Representatives) who have predictably signed onto the Alan-Derwshowitz-led attack on academic freedom at Brooklyn College. This group of Israel advocates and elected officials is demanding that the college’s Political Science department rescind its sponsorship of an event featuring two advocates of the BDS movement aimed at stopping Israeli occupation and settlements.In 1999, then-New York City Mayor Rudy Giuliani threatened to cut off funds for the Brooklyn Museum unless it withdrew art exhibits he found “offensive”.

      The threat to academic freedom posed by this growing lynch mob is obvious: if universities are permitted to hold only those events which do not offend state officials and “pro-Israel” fanatics such as Alan Dershowitz, then “academic freedom” is illusory. But on Sunday, that threat significantly intensified, as a ranking member of the New York City Council explicitly threatened to cut off funding for the college if his extortionate demands regarding this event are not met.

      1. jsmith

        More from the article:

        “This is about only one controversial issue (Israel) and about suppressing only one side of that issue (criticisms of and activism against Israeli occupation and settlements). Just as it is extraordinary that a nominated Defense Secretary in the US has to take repeated vows of fealty to Israel and spend most of his confirmation hearing discussing not the US but that foreign country, it is truly extraordinary to watch “liberal” officials in the largest city in the US expressly threaten the funding of a college for the crime of holding an event that is critical of Israel (MSNBC’s Chris Hayes, who admires – and has previously had on his show – several of the New York members of Congress who have joined this Dershowitz-led campaign, yesterday lambasted their conduct aimed at BC as “outrageous and genuinely chilling”).

      2. Aldous

        Academic freedom? Free press anyone? Democrats are liberals, since when?
        Universities, especially ones that want to challenge the status quo, can only do so through poststructuralist critiques of everyday life, ie convoluted, self-referential, technical and unreadable papers.

        For example, “In periodizing a phenomenon of this kind, we have to complicate the model with all kinds of supplementary epicycles. It is necessary to distinguish between gradual setting in place of various (often unrelated) preconditions for the new structure and the “moment” (not exactly chronological) when they all jell and combine into a functional system.”

        I don’t know what this means, but by god, it sounds progressive and I think that’s all that matters.

  19. Garrett Pace

    Maybe it’s just boilerplate, but there’s something creepy about the admonition accompanying the White House’s photo of President Obama firing a rifle.

    “This official White House photograph is being made available only for publication by news organizations and/or for personal use printing by the subject(s) of the photograph. The photograph may not be manipulated in any way”

    GOOD HEAVENS. Now even photos of presidential recreation have attained the status of “top secret” intelligence.

    How long till someone gets Guantanamoed for pointing out that the President is shooting a right-handed rifle?

    1. Yves Smith Post author

      Felix was wrong on this and everyone keeps repeating him.

      The Gaussian cupola was used on CORPORATE CREDIT RISKS.

      Did CORPORATE CREDIT RISK have much of anything to do with the GFC?

      Felix claims it was used in creating CDOs.

      Guess what?

      CLO (collateralized loan obligations) are indeed a type of CDO. Gaussian cupola formula most assuredly used with them. However, it was NOT used on ABS CDOs (asset backed securities CDOs, the kind pretty much everyone means when they talk about CDOs).

      I can’t stand it when people get disinformation as to what caused the crisis.

  20. Bridget

    Visible poverty and decaying infrastructure in NOLA? It has ever been thus. And that most exasperating and charming of cities is American in name only, which is a big part of it’s charm.

    Fascinating stuff about King Richard’s skeleton.

    1. Laughing_Fascist

      S & P downgraded the U.S.; Moody’s and Fitch did not. Maybe the Obama crowd waited awhile so it would seem there is no connection.

      S & P might have an interesting defense. And has implied (threatened?) that the gov officials who said in 2007 that all is well in the subprime universe are going to be called to account if the case were ever to make it to court:

      A DOJ lawsuit “would disregard the central
      facts that S&P reviewed the same subprime mortgage data as the rest of the market – including
      U.S. Government officials who in 2007 publicly stated that problems in the subprime market
      appeared to be contained – and that every CDO that DOJ has cited to us also independently
      received the same rating from another rating agency.”

    1. Yves Smith Post author

      I was lucky enough to live in Sydney when it was still cheap.

      Just think if I’d managed to find a way to earn a living in AUD.

      Of course, that would not involve writing a blog.

  21. Aldous

    @ US CO2 Emissions

    The article states that CO2 emissions in the US in 2012 were the lowest since 1994. The Bloomberg report states that CO2 emissions from the energy sector were on pace to be the lowest since 1994. The report, for all emissions based charts, sources the US Energy Information Agency (EIA) which released a report in August of 2012 that said US CO2 emissions from energy demanded, equivalent to emissions from energy use and or energy consumption, fell to its lowest level in 20 years. Well this is just fantastic and all, but it doesn’t even come close to accounting for everything entering the atmosphere. At best, reports like these are adding up the sales figures for coal, oil, natural gas and renewable’s to determine emissions from the energy sector. Essentially what is used to calculate emissions then is

    CO2 emissions from fossil fuel use
    + (CO2 emissions from all other energy use)

    What should be used is the following formula,

    (CO2 emissions from fossil fuel use)
    + (CO2 emissions from all other energy use)
    + (CO2 emissions from energy production & distribution)
    + (non-CO2 energy-related emissions)
    + (all non-energy-related greenhouse gas emissions)
    = total greenhouse gas emissions

    The EPA uses the latter formula and in its April 2012 inventory report, GHG emissions for 2010 were up 3.2% over 2009 emissions, with an average annual growth rate from 1990 through 2010 of 0.5%.

    It should also be noted that this formula doesn’t account for emissions generated from the coal that is exported. All in all, this article makes for a great sound bite but none of this is news if it doesn’t lead to net reductions.

  22. AbyNormal

    Insidious Criminal Exchangers have attached bayonets

    Back in October, the Intercontinental Exchange (ICE) converted the energy swaps contracts it cleared into futures contracts. That was pretty easy to pull off because both ICE and its traders were already very familiar with commodity futures. In December, the CME Group started offering a more exotic product, the “deliverable interest rate swap future”. Like all futures contracts, the product is a promise by the seller to provide something to the buyer at a fixed point in the future. But instead of wheat or government bonds, sellers of this new contract agree to provide buyers with an interest rate swap, which would presumably have to be acquired from a bank or other swap dealer. ICE plans on releasing a new futures contract in April that would be based on an index of credit default swap (CDS) prices.

    This process could continue for quite a while. The Bank for International Settlements estimates that the current size of the global OTC swaps market is somewhere between $600 and $700 trillion (in notional terms). For perspective, the World Bank estimates that the combined equity market capitalisation of every listed company on Earth is about $50 trillion. America’s futures markets are about half of that size. The big exchanges therefore stand to gain tremendously from even a relatively small shift towards futures and away from swaps. The incumbents—the big dealer banks and the interdealer brokers—stand to lose out. They, and others with vested interests in the status quo, argue that the rules being written by America’s Commodity Futures Trading Commission (CFTC) are unfairly biased in favour of the futures markets. In an effort to sort out everyone’s views, the CFTC hosted a public roundtable last Thursday. Your correspondent was in attendance. further 411…

  23. LucyLulu

    Somebody posted recently about being charged thousands when his son got four stitches and then had them removed. I couldn’t believe it could be true but then saw this article about charges from out-of-network docs. Insurers will only reimburse the doctors for “usual and customary” fees but the doctors can then go after the patient’s for the difference if out-of-network (unlike participating doctors who have agreed to fees). You gotta see some of these charges that have been submitted.

    An extended office visit with an established patient, normally reimbursed at $130-$150 by Medicare, was billed at $6205 in MA. NY doctors are the worst offenders. An upper GI with biopsy, a 5 minute procedure which Medicare reimburses at about $300 was billed for $30K by a NY doctor. Another NY doctor billed $115K for a spinal fusion that Medicare pays less than $2000 for. Granted Medicare rates may be a bit low, and there have been legal settlements over the “usual and customary” rates and how private insurers set them, but geesh………….

    $6000 Office Visit? Insurers Slam Steep Out-of-Network Fees

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