Links 1/29/14

Linkage excess because SOTU. –lambert

Youngsters check their phones every ten minutes: One in 20 looks at their mobile every minute of the day Daily Mail

Rare and Dangerous Ice Storm Hits Deep South; Extreme Cold in the Midwest Weather Underground

Central banks in emerging markets take action AP

Turkey’s Central Bank Declares a Shock-and-Awe Rate Hike WSJ

The Reliability of Chinese GDP, Again Econbrowser

Orders for U.S. Durable Goods Unexpectedly Slump Bloomberg

Exclusive: U.S. banking regulator, fearing loan bubble, warns funds Reuters

Series of Deaths Among Financial Workers Jolts London WSJ

The challenges of a post-crisis world Martin Wolf, FT. Davose man so consensus wow.

Going past what is sustainable… Another market failure Angry Bear

“All You Need for a Financial Crisis . . . Baseline Scenario

Madoff IT Guys Wrote Code to Trick Auditors, Jury Told Bloomberg

BP Continued Suspension From New U.S. Contracts Sought Bloomberg


What the State of the Union Means for 2014 Times. One word: “Squat.”

Six things we learned from the State of the Union NBC

Keeping His Powder Dry Foreign Policy

Obama Downplays Trade Authority, Trans-Pacific Partnership: Fleeting Mention Doesn’t Even Reference Recently Introduced Camp-Baucus Fast Track Bill Eyes on Trade

What’s the Deal With Obama’s New MyRA Plan? Matt Yglesias, Slate. The deal is more fees for money managers, duh. Why not just increase Social Security?

Obama’s Plan to End Discrimination Against the Long-term Unemployed New York. Will the political class ever admit that a permanently shrunken labor force is an elite policy goal that Obama has successfully achieved? Wait, don’t answer that.

What Obama Ignored About The ‘Lowest Unemployment Rate In Over 5 Years’ HuffPo (CB)

The White House Briefing Sheet [PDF] (SOTU full text). What, no school uniforms?

The Most Accessible and Interactive SOTU Yet More walking around money for the creative class.

The world’s rich stay rich while the poor struggle to prosper FT. Gates letter takedown.

Gap between rich and poor may be exaggerated McClatchy

Pentagon investigations point to military system that promotes abusive leaders WaPo. No Wellingtons or Nelsons, these.

Alpha male ‘just a thing some men think they are’ Daily Mash (LS)


How to measure Obamacare success CJR

Obamacare increases incomes of poorest, study finds USA Today

Why Nothing Apple Does Is Ever Good Enough Wired (and see also).

Unfriending Bronte Capital

Jason Calacanis launches Inside, a mobile news-curation app powered by humans GigaOM

Digital media goes highbrow Felix Salmon, Reuters

Big Brother Is Watching You Watch

Huge swath of GCHQ mass surveillance is illegal, says top lawyer Guardian

Verizon’s Storefront emptywheel

We Are Sleepwalking Towards A Cashless Society Testosterone Pit

Bitcoin’s Future Gets a Hearing WSJ (and Winklevosses want sheriff to police virtual currency ‘wild west’).

Bitcoin repeats gold-standard errors Reuters

Thai Takedown Foreign Affairs

The horrors ‘12 Years a Slave’ couldn’t tell Al Jazeera

Advertisements for Death Times (FM). “Perpetrator images.”

Florida Finds New Ways to Encourage Reckless Gunplay Bloomberg. All I can say is I hope the oceans don’t rise.

‘Humane’ homes for migrant workers delayed by planning system in Qatar Guardian. Building 2022 World Cup facilities; “squalid and overcrowded conditions which are believed to contribute to a high death toll among migrant labourers.”

A History of Offense-vs.-Defense Super Bowls Grantland

What a good economy should look like The Center of the Universe

Antidote du jour:


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About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. financial matters

    Exclusive: U.S. banking regulator, fearing loan bubble, warns funds Reuters

    “”The OCC, Fed, and the FDIC issued guidelines to banks last year to limit their risk-taking for leveraged loans. But regulators are no more sanguine with asset managers taking on this risk given their investors include underfunded public pension plans. They are also worried about the growth of the so-called shadow banking sector, which includes non-bank lenders such as hedge funds and money market funds.

    No major asset manager would comment for this story.”


    Good that they’ve at least got their eye on this. This is how GFC 1 started..

    “”However, banks have increasingly financed their positions in assets by issuing a combination of uninsured deposits plus very short-term non-deposit liabilities. Hence, the GFC actually began as a run on these non-deposit liabilities, which were largely held by other financial institutions.””

    1. Skeptic

      Exclusive: U.S. banking regulator, fearing loan bubble, warns funds, they may have to be BAILED OUT! Reuters

  2. b2020

    The MyRa, an Obama classic:

    What it is not:
    – a no-fee alternative to IRAs
    – an option for those without “participating” emloyers
    – an FDIC insured account to the legal maximum
    – an option outside a predatory system to extract rents from retirement savings

    What it is:
    – “an automated way for people to get into the savings system”
    – a “kick off a much-needed national conversation” on retirement security
    – “a new way for working Americans to start their own retirement savings”
    – a plan for those whose employers choose to participate
    – with a maximum balance of $15,000
    – money would have to be rolled over into a private-sector Roth IRA, feeding participants to said predatory system

    The record of the 401(k) as well as the IRA throughout the financial crisis is atrocious, with a national 40% average lost. Obama, as could be expected, does nothing to address this issue. MyBama is simply offering a token reinforcement to “every retiree for himself” memes in support of the privatization of Social Security Trust Fund obligations and revenue streams. To the extent this executive exercise in masturbatory wrist-flicking actually accomplishes anything, it would be to force anybody succeeding in saving more than 15k into a private sector in dire need of additional rents.

    Bush’s bank bailouts at least had panache and vision (within the narrow context of the ongoing competition to go balls-out for the financial sector). This is as tepid as it is disgusting.

    1. b2020

      – not a no-fee/low risk alternative to 401(k) either
      – workers “automatically enrolled unless they specifically elected not to participate”

      The timing is impeccable: “While the stock market has doubled over the last five years, that doesn’t help folks who don’t have 401(k)s,” the president said. If he should actually deliver on this – fat chance – it will be just in time for the Bernanking Bubble to burst.

      1. MyLessThanPrimeBeef

        No mention of single administrater, universal pension for all.

        Just don’t get old, cause that ‘Cadillac’ defined benefit retirement plan is not for you.

    2. jrs

      It does sound like classic Obama. Complexity piled high and deep, all kind of legal conditions, laws almost noone can understand the ins and outs of, with hidden gotchas. Whether one even qualifies will be entirely arbitrary. Sounding familiar? Maybe they should make the states have to implement it so whether you qualify depends on the state you live in .. . of course the website will be too complex to code well. Actually if software engineers made our laws unlike Obama they would K.I.S.S. Obama’s S.O.P. seems to be: keep things hopelessly complex and very narrowly targetted. A program for the masses? No for people who happen to meet weird qualification x, y, and z. The bureaucracy just grows as thick as a rain forrest. Oddly enough that type of red tape is part of what people actually HATE about government and with good reason.

      To think that in the days of actual U.S. prosperity you could get 6% on an FDIC insured bank account without 500 pages of legalese.

  3. ohmyheck

    I am betting the cat is a Norwegian Forest Cat. I have one. He is a different color, but has the mane, the big paws, long whiskers and fancy ear hairs, among other traits.

    1. Jess

      Don’t Norwegian Forest Cats grow to huge sizes? Friend of mine told me about seeing some kind of Scandinavian cat at a cat show someplace and the thing was like effing huge!

    2. Max424

      More likely a Maine Coon. The curved nose and the oval eyes are the giveaway.
      Not that there’s much difference. The Maine Coon is a Norwegian Forest Cat one ocean –and a thousand years!– removed, I always say. Yup, our long haired friends came over on the Viking ships, and then decided to stay, and unlike later settlers like the Pilgrims and the Conquistadors, they’ve lived in peace and harmony with the locals ever since.

  4. Clive

    Not quite 1929-esque levels but bank employee suicides are making the headlines here:

    Where I work, I now know of two in the last two months. Middle/lower ranks so they don’t get the coverage (even in death, the 5% get priority treatment). Deepest sympathies to the families of those involved. No-one — no-one — deserves death.

    Of the cases I know directly, “overwork” is the catch-all explanation. What never gets properly analysed is what, exactly, the nature of that “work” really is. From what I can tell, it was more a situation of trying to hold the line between at-best dishonest and at-worst illegality “requests” from higher management and wrestling in either the individual’s consciences or their fear of getting caught / having to take the fall.

    I’ve said it before and I’ll say it again: The rich are, by and large, not especially happy. They are not happy because they can become trapped in a dependency on high incomes. The ability to acquire a lifestyle beyond one’s salary is a constant risk to all but the 0.1%. Many people I know on £100k+ a year comp have negative or borderline positive net worth. Walking away is not always a viable option (or at least, the unfortunately people concerned don’t see it as such).

    One final observation (sorry to be morbid in this comment) — a friend witnessed the scene at Canary Wharf and she described a low-key speedily cleaned up slickly managed operation in the aftermath. The Metropolitan Police are not usually so discreet (bodies turning up where they shouldn’t are normally 10 o’clock news fests with armies of forensic specialists and Deputy Chief Police Officers bigging up their public profiles) and they convinced themselves pretty quickly this couldn’t possibly be anything like a crime scene. If there was an unexplained death at my house, they’d be there for a week.

      1. Clive

        Say if I’m misinterpreting here Shutter, but be careful about whom you wish to see on the end of your springboard. The 0.1% use the notion “because they don’t deserve any better” to justify their methodologies and philosophies. Suffering is suffering is suffering. The only reason we are better then they are is because we realise this.

        1. Shutter

          Clive, thanks for bring that up. Don’t want to be misunderstood.

          If they won’t jump, I’ll push them.

          There. Now my position is clear as a bell.

            1. hunkerdown

              Bullshit. They would hire someone to push you. I would do it out of duty to the community.

              The religious devotion to non-violence doesn’t gain any ground if they don’t actually need you alive.

    1. MyLessThanPrimeBeef

      It would be better if they were checking their tomato plants or something like that, every minute.

      At least, they would be contributing to the GDP (only if they sold them).

    2. neo-realist

      I always thought the dead ringer giveaway for crap parents was kids becoming anti-authoritarian punks who play 1 minute songs.

  5. Eeyores enigma

    What a good economy should look like shows how clueless WARREN MOSLER is. It sounds like a doddering old man saying “back in the good old days we used to……”.

    Economics is simply an accounting of all possible resources required for life on this planet balanced out with all life on this planet.

    Economics has left the stratosphere wrt any hint of reality based accounting.

    What it has become is a tool for the rich and powerful to manipulate in their favor to become even more rich and powerful

    Full employment will never again be possible, at least not anything like what humanity has ever experienced so far. We either come to terms with that and establish an equitable path forward with dignity for all or we will just keep playing cut-throat musical chairs until the population numbers are – ahem! – more equitable.

    1. MyLessThanPrimeBeef

      It’s a problem of human nature…the only field worth going into.

      Now, consider these:

      the tallest person < 2 x the average person
      the highest jump < 2 x the average person's jump
      the fastest 100 yard dash < 1/2 the average man's 100 yd
      the heaviest person < 3 x the average person
      the weight lifting record < 8 x the average person's bench press

      and this
      the highest I.Q. < 2 x the average person's IQ of 100 (not sure it's an exponential scale).

      So, it's quite reasonable to assume that the most a person would need, as far as wealth is concerned, should not be 2 to 3 or 4 times the average wealth, combining all different factors. And if your I.Q. is over 200 (two times the average of 100), and if you don't know that, that I.Q is wasted on you…you have no wisdom.

    2. psychohistorian

      I agree with everything in your comment except the assertion that somehow economics has changed and was not always a tool for the rich and powerful to manipulate in their favor.

    3. Calgacus

      Full employment will never again be possible, at least not anything like what humanity has ever experienced so far.

      Really? Full employment, 100% employment, zero unemployment is and always will be extremely easy to attain. No country which has ever tried to have full employment has ever had any difficulty attaining it. If there is unemployment, it is because the government wants it, and the people are too stupid. To get rid of unemployment, the government just puts up a sign, $20/hour say, for whatever work the government decides. In a sane society, the government is democratic and the work is tailored to each person’s abilities and desires as much as possible, That’s it. The JG. World’s Biggest Economic Problem solved for eternity. The END.

      Extremely stupid problems like unemployment – or bleeding from stabbing yourself – tend to have extremely simple solutions, like the JG, like stopping stabbing yourself. No devil in the details.

      1. Skippy

        Sad really that some would agree with the neo]classical’s that unemployment should be used as a first order inflation tool, when there are other options that don’t ravage such a large population.

        skippy… self inflicted wound thingy…

    1. psychohistorian

      The dude’s follow on today is that the reporter was not being professional and didn’t have enough respect…..classy

      1. hunkerdown

        Maybe some of the kids who used to go wilding would take a request. The proper posture for an elected official is tearful, wailing prostration before the citizens whom they ostensibly serve.

  6. TarheelDem

    As presented, what came to mind as the myRA was a Treasury-based savings bond account withheld by employers and tax-deferred according to one or the other IRA rules. A poor man’s T-Bill deposited into an IRA and government managed. Kinda gimmicky way for people to try to get a higher return on investment through tax deferment.

    If however it is welfare for Wall Street (i.e., involves yet another product peddled through employers to employees), it is the boondoggle that the notes next to the link describe.

    At best it founders on the fundamental issue with self-saving for retirement. If you don’t have sufficient money to save a sufficient retirement nest egg, you can’t put it away to start with. If socially caused dislocation, like massive housing fraud, wipes out your assets, you are lost in retirement. And government guarantees are not going to mean much if the government establishes a pattern of cutting and running when there are large claims on entitlement programs.

    So at best, it depends on the good faith and credit of the Congress, which is currently standing in the balance.

    It appears to be an upper-middle-class sop for people who lust for a secure Roth IRA. The other 80% won’t be able to use it.

    But it does create a class of small creditors of the US government who might kick up a stink when failure to pay debts comes up again. Because the PtB seemingly think that debt ceiling games are in their interest or they would immediately shut down the nonsense.

  7. MyLessThanPrimeBeef

    Phone checking every 20 minutes.

    People are crying out for connection, waiting for something meaningful to happen to them. Whatever this world is providing them, 24 hours news, or what not, it’s not satisfying enough…perhaps he/she is stuck in a boring job or waiting for a meaningless job that might come along when we have a JG program – to ease the billionaire’s insomnia problem, I guess, but I doubt it. I think the billionaire just needs less noise, making his/her world, er, more tranquil and beautiful.

    Man is a social animal. That means, we do things together, like, er, GDP. We produce GDP as a team. If you don’t believe it, try making a smartphone from scratch all by yourself.

    1. Calgacus

      Why do you think JG jobs would be meaningless? Were the New Deal jobs programs, the WPA, the PWA, the CCC, the NYA, the Federal Arts Project etc meaningless?

      Why should a job to do stuff that everybody gets together and says “itoughtabedone”, done by people with the skills to do it, with people being taken as they are and placed in jobs matching their skills and desires as much as possible – and this job and the money that comes with it being understood as a human right – why should this be meaningless? Are the only meaningful jobs ones that help some rich person get richer? Why? Seems to me that the reverse is the truth.

  8. Kokuanani

    Do you really think trust fund baby Matty Yglesias is going to give us an accurate run-down of ways to help ordinary people save?

  9. MyLessThanPrimeBeef

    Towards a cashless society.

    This quote is interesting: ‘…we are, it seems, descending into a world where new technologies threaten to put absolute power well within the grasp of a select group of individuals and organizations’

    Is this not usually true – With every technology, the rich can always purchase more of it, earlier too, if not exclusive to them, to their advantage and to the regret of the not-rich?

    And if the First Machine Age didn’t get you, the conclusion should not be rashly that there is nothing to worry about concerning the Second Machine Age. That would be Induction Folly…like saying ‘hyperinflation never happened here before.’

    A prudent man reminds himself that machines are not stupid. Machines know ‘if at first you don’t succeed, try, try again.’

  10. Skeptic

    A History of Offense-vs.-Defense Super Bowls Grantland

    I am quite amazed and disheartened to see NC promoting the STUPOR BOWL. It shows little understanding of how the Media-Entertainment-Sportz complex puts the population to sleep. Those billionaire sportz team owners chortle in their taxpayer funded Skyboxes as the debt slaves enjoy their days of drunkenness and overconsumption before heading back to work, if they have any.

    I dread to think what the Olympricks and Sochi may bring to NC.

  11. jrs

    By the way the MYRa. It’s a libertarian meme that government seeks more and more programs to try to solve the problems they have caused. But really isn’t that what is going on here? Is not low interest rate policy so that you get no interest on your bank account and CDs very much government policy? And now they complain that we don’t have invesetments with a good balance of risk and reward? Well uh … duh .. it’s called ZIRP. You built that. Of course they also aren’t interested in reducing the risks due to even pure criminality (slap on the hand for looking the other way at Bernie Madoff!)

  12. fresno dan
    “Transferring future losses from banks to pension funds does not aid long-term financial stability for the U.S. economy,” he added.”
    Apparently, this gubermint employee never got the memo that the sole purpose of the corporernment is to harvest all assets, including organs, from the citizens for the benefit of the banks…because its a credit based….uh, fraud based system. The stability of the economy for other than the 1% is not the government’s concern.

  13. jfleni

    RE: Reliability of Chinese GDP.

    Ten percent growth rates year over year certainly will never happen again, but despite problems, China has dedicated itself to continued prosperity for its people, and has not taken the bait of threatening and truculent moves by Japan and the US.

    They will advance and prosper, while others deceive themselves into believing that they can change outcomes by being tough guys, instead of “sticking to their own knitting of development and real economic progress.”

  14. RanDomino

    That Reuters Bitcoin article- it was posted satirically, right? I’m no Bitbug but, come on, “in the contemporary world governments are the pre-eminent social guardians.”? I don’t know how anyone could say that with a straight face. I lost it just reading it.

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