Links 4/25/14

If you are in New York City, be sure to drop by our meetup TONIGHT (Friday), from 5:00 to 8:00 PM at Sláinte at 304 Bowery (map with nearby train stops here). Be there or be square!

Strip private banks of their power to create money Martin Wolf, FT

U.S. Said to Ask BofA for More Than $13 Billion Over RMBS Bloomberg. No. Bankster CEOs in orange jumpsuits doing the perp walk is the only acceptable outcome. Anything else is a midterm-driven head fake left.

Exclusive: Apple, Google agree to pay over $300 million to settle conspiracy lawsuit Reuters. Ditto.

American state-backed mortgages are a $5tn millstone Gillian Tett, FT

GM says facing multiple probes into recent recalls Reuters

NY Attorney General tells Pando: Current hotel laws were made with Airbnb in mind Pando Daily

[영어 전문] 오바마 미국 대통령 중앙일보 단독 인터뷰 Joongang Ilbo. English-language email interview with Obama.

Strike halts work on Panama Canal expansion AFP

RMT union to strike in London over tube ticket office closures Guardian

Exclusive: JetBlue flight attendants seek to hold unionization vote Reuters

State Employment Trends: Does a Low Tax/Right-to-Work/Low Minimum Wage Regime Correlate to Growth – An Econometric Addendum Econbrowser

Cliven Bundy’s ‘better off as slaves’ remark about blacks draws fire LA Times. Nice to see the “state’s rights” / “slavery as a positive good” talking points of pre-Confederate political theorists morph right into libertarian/conservative talking points. As has been happening for a good twenty years, at least.

6 Reasons Why Obama’s Clemency Program For Drug Offenders Doesn’t Change Mass Incarceration One Bit Black Agenda Report


Oregon Panel Recommends Switch to Federal Health Exchange Times. $300 million down the tubes and thousands not covered because markets.

Why Canada may be heading down the ‘slippery slope’ toward American-style health care HuffPo. The Neoliberal Internationale at work.

Recommended Reading: Houston Law Review Frankel Lecture and Commentaries Offer Valuable Analysis of the Affordable Care Act and Guideposts for Continued Reform Health Reform Watch

Getting Ready for Hillary Clinton in 2016 Is Costly Deal Bloomberg

Meet The Oppo Researchers Who Want To Derail The Clinton 2016 Train TPM

Big Brother Is Watching You Watch

Reforming the NSA: How to Spy After Snowden  Brookings Institute

Lawmakers petition for open NSA debate CBS

Information Isn’t Free: The High Price Whistleblowers Pay Motherboard

NIST finally dumps NSA-tainted random number algorithm ZDNet

How to bring net neutrality back from the dead Cannonfire

Why net neutrality no longer works FT

Goodbye, Net Neutrality; Hello, Net Discrimination The New Yorker. Obama, 2007: “I am a strong supporter of net neutrality.”

Maintain true net neutrality to protect the freedom of information in the United States White House Petition


Ukraine: Anyone Interested In A Larger War? Moon of Alabama

Edging ever closer Economist

Poland presses for shift from Russian energy as Ukraine standoff escalates Globe and Mail. Poles called for 10,000 US troops, got 150 paratroopers.

Ukraine crisis: Kerry accuses Russia of ‘destabilisation’ BBC

Ukraine forces kill rebels; Russia starts military drills Reuters

Russia’s Latest Land Grab Foreign Affairs

Happy ANZAC Day

A fatal wait: Veterans languish and die on a VA hospital’s secret list CNN. No doubt the prelude to a privatization drive.

No end in sight to Thailand’s political unrest Japan Times

Ecuador Expels U.S. Military Group AP

Danger on the rails: outdated tankers carrying crude oil AxisPhilly (PT)

Cheap Non-GMO Food Supply AP. Victory for food sovereignty in VT.

Google social networking boss Gundotra leaving company Reuters (Google+ to go the way of Google Reader?) And see this from “3d” ago (stupid locution; which side of the international dateline?)

Up Close on Baseball’s Borders Times. Wait, wait. I thought Nate Silver was the baseball guy?

Kowloon Walled City Online WSJ

George R.R. Martin: The Rolling Stone Interview Rolling Stone (furzy mouse). Less interviewing, more writing. Valar morghulis.

Disgorge the Cash The New Inquiry

Antidote du jour:


See yesterday’s Links and Antidote du Jour here.

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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. Banger

      What most Americans don’t understand is that our government plays a Machiavellian game using any technique–assassination, false flag, torture, misinformation/misdirection, manufacturing fact through altering photos, forgery, sexual manipulation and on and on. Why we choose to ignore these facts–and they’ve all been proven true at some time or another–I will never understand. All this is hidden by the myth of American Exceptionalism and the utterly false notion that these people (who perform these acts) are protecting us from anything–often, in their deluded states, they believe they are the “good guys” because they have to in order to avoid cognitive dissonance.

        1. Eureka Springs

          Exceptional monsters. The Dept of State under either criminal party would be embarrassing if it wasn’t so horrific.

          No shame, no rule of law… certainly no democracy nor a peep out of democrats who howled over Powell Bush PNAC and all the rest for doing the exact same things.

          The NYT needs to print the retraction on the same front page they printed the original lies.

        2. optimader

          well, the irony is that the notion of Exceptionalism applies to both side of normal.

          The irony is that adherents of National Exceptionalism (the US version is not exclusive) are invariably passengers in the critical thinking Short Bus of Life either due to self inflicted ignorance or state inflicted ignorance.

          One of the most remarkable examples I’ve heard observations about were from a friend that was on a refinery startup in Romania during the fall of Nicolae Ceaușescu and the Romanian Communist Party.

          He said the population became profoundly depressed when it was revealed to them the true conditions they were living under vis a vie their European neighbors. I m sure similar psyche damage will eventually play out in N Korea.

      1. different clue

        Which “we” denies these facts? You don’t deny these facts. Many others here don’t deny them. I am aware that gatekeeper leftist Noam Chomsky denies all the facts and even possibilities regarding assassination. How many ordinary Americans support Chomsky’s view that Oswald diddit . . . acting alone, or if he didn’t . . . what difference does it make anyway?

    2. OIFVet

      I can’t decide whether TPTB are so arrogant that they can feed us with obvious lies and think that we are dumb enough to swallow them, or are completely divorced from reality, or are desperate to create a foreign enemy to distract us from domestic issues, or all of the above. Seeing Kerry this morning bellowing about RT propaganda without even the slightest hint of embarrassment or self-irony was very disturbing, to put it mildly. To have people like this making our foreign policy is dangerous and frankly I am afraid that the aim is war. I never thought I would see the return of the bad old days but here we are, and it was us who started it.

  1. Banger

    Re: Cliven Bundy

    If you read the text of Bundy’s statement you can see a couple of things. First of all, he is an illiterate and appears to lack fundamental language skills–but he has a point though he does not understand it nor did he make it. The point is that poor black, or poor white for that matter, life may not be better than slavery if we view slavery in its most benign form. Let’s assume, for the moment, that it was the social norm to treat slaves with respect, not break up families and so on (as Bundy imagines it), wouldn’t the fact that these slaves had a purpose make up for their lack of freedom at least somewhat? And really, what freedom to ghetto dwellers really have? For all our clapping ourselves on the back the reality is not very good–just take a gander at prison populations–the new plantations.

    Victor Frankl showed us that meaning helps people survive and even thrive in difficult circumstances–when we lack meaning, I suggest, even comfortable situations are highly stressful. There’s another dimension Bundy doesn’t see–and that’s the systemic racism and its effect on families, individuals and culture. Perhaps because he personally has never met or known the people he disparages–I would guess if he conversed with them he might understand their POV–and, in my experience, that POV is often not pleasant. Despite cultural changes most of us still don’t understand black experience and how being a lower- class ignorant black is different from being a lower-class ignorant white person who entertains opinions like Bundy. Science has shown us that black people are racist against themselves–what more proof do we need that we live in a racist society? So why is it a big surprise that Bundy lifts the veil of racism which we want to shove underneath the rug so we don’t have to face the reality of what this culture really is.

    1. Johann Sebastian Schminson

      I’m pretty damned sure that there is and never was such thing as a happy, secure, “respected” slave.

      Slaves get whipped.

      The only thing we’ve accomplished is to replace outright slavery with debt slavery and whipping with prison.

      Cliven Bundy should be treated as a debt slave (he owes us big time ducats) AND sent to a prison that will treat him equally to all of the other inmates.

      1. CRLaRue

        Two hundred years ago a marketable slave cost upward of $2000.00.
        In todays dollars_________(fill in the blank). to maltreat your slave(s) It would be like not performing PM on todays $400,000. combine!
        Oh! and lets be honest the slaves where not stupid, they routed for their team, and
        hoped that the banks advanced that crop seed money each year!

        1. Lambert Strether Post author

          Yes. The destruction of the Slave Power was also the destruction of a massive amount of capital, equal IIRC to the industrial capital of the North. Certainly massive.

    2. Brindle

      Be gentle taking your foot out of your mouth:

      —“Science has shown us that black people are racist against themselves–what more proof do we need that we live in a racist society?”—

      1. jagger

        Not sympathizing with Brundy but there have been slaves throughout history. Their circumstances have varied from primarily atrocious to sometimes fairly good. Look at some of the slaves during the Roman or Greek timeframe. Some were better off than free man. Of course, all slaves lose independence and control of their destiny lies in the hands of others.

        1. Brindle

          Just a difference in point of view.
          Mine being that parsing and giving nuance to racism and slavery is similar to doing same with torture.

        2. MrColdWaterOfRealityMan

          Which more or less describes anyone who works, particularly if the must continue to do so to afford health care.

      2. Banger

        What I meant is that they a racist against themselves as shown in tests that flash photos of various races and then analyzing attitudes both white and black respondents tended to adopt more negative thought after viewing pictures of black people–that says, essentially that racism is largely unconscious and is instilled into us by our culture.

        1. Paul Tioxon

          WEB DuBois spoke of the “twoness’ or double consciousness of Black people in America. Here it is in his own words.
          The term originated from an Atlantic Monthly article of Du Bois’s titled “Strivings of the Negro People.” It was later republished and slightly edited under the title “Of Our Spiritual Strivings” in his book, The Souls of Black Folk. Du Bois describes double consciousness as follows:

          It is a peculiar sensation, this double-consciousness, this sense of always looking at one’s self through the eyes of others, of measuring one’s soul by the tape of a world that looks on in amused contempt and pity. One ever feels his two-ness,—an American, a Negro; two souls, two thoughts, two unreconciled strivings; two warring ideals in one dark body, whose dogged strength alone keeps it from being torn asunder.

          The history of the American Negro is the history of this strife — this longing to attain self-conscious manhood, to merge his double self into a better and truer self. In this merging he wishes neither of the older selves to be lost. He does not wish to Africanize America, for America has too much to teach the world and Africa. He wouldn’t bleach his Negro blood in a flood of white Americanism, for he knows that Negro blood has a message for the world. He simply wishes to make it possible for a man to be both a Negro and an American without being cursed and spit upon by his fellows, without having the doors of opportunity closed roughly in his face.”[2]

    3. optimader

      “(The point is that poor black, or poor white for that matter, life may not be better than slavery) (if we view slavery in its most benign form)”

      Example of each please.

      1. John

        Slave life better than free man. In the antebellum south slaves we worth quite a bit of money so there was an impetus among the owners to keep them well fed and healthy. Just to protect their investment.
        While in the post war Jim Crow south, blacks were “free” but could be kept in starvation wage or sharecropping situations because there was no investment to protect. And there were always plenty of replacements. They only had the freedom to leave, which many did. But many stayed and suffered. Jim Crow was quite an evil setup, even tho they were technically “free”.

        1. optimader

          “Slave life better than free man.”

          “..slaves we(re) worth quite a bit of money so..”
          I’m guessing more like a distribution from “worth a lot of money” to “a negative worth”. Slaves were treated as depreciating durable goods, how’d that work out at the end of service life?

          Your observation that Jim Crow was quite an evil setup = Non sequitur to your claim “Slave life better than free man”
          Yes Jim Crow was indeed “an evil setup”, slavery was dramatically worse.

          1. allcoppedout

            Abolition here led to massive pay outs to the slaver owners and something similar to Jim Crow. I wonder if the slaves became uneconomic and a burden on owners?

        2. Paul Tioxon

          Slavery is not at all what you attempt to argue, here, there or anywhere else at anytime. In the book “The Chaneysville Incident”the author, David Bradley, recreates an oral tradition from his hometown about 13 runaway slaves, who were buried in a graveyard, supposedly killed by whites at their request when this link in the Underground Railroad was about to lead to their certain capture and return to slavery. Bradley feels otherwise, and depicts their deaths, of adults and the children with them as suicide/murder rather than return to slavery. In discussion, he told me that it seemed impossible to comprehend what would bring a parent to deliberately kill their children for their own good? The measure of the horror of slavery could be seen in such events. This was a common occurrence documented as part of the unspeakable life of a slave. It is also a line from old spiritual songs, revealing the innermost feelings of slaves, protected by he veil of Christian worship, the only channel of authentic expression allowed that would not draw violent retribution for transgressing the official and unofficial boundaries of slavehood.

          Oh, freedom, Oh, freedom,
          Oh freedom over me.
          And before I’d be a slave
          I’d be buried in my grave
          And go home to my Lord and be free.

          No more weepin,(don’t you know), no more weepin,
          no more weepin over me.
          And before I’d be a slave
          I’d be buried in my grave
          And go home to my Lord and be free.

          1. allcoppedout

            The horror of it all is rarely exposed to us, nor those who still benefit from money made. I think what people are alluding to here is that some people taken as slaves actually found the new culture better than the one they were taken from. I’ve seen a number of anecdotes along these lines about British seamen who converted to Islam. However, the real story is much as you say Paul – and worse. It’s part of us not being taught real history. Sometimes life was so bad that people sold their kids into slavery.

    4. optimader

      “…black people are racist against themselves–what more proof do we need that we live in a racist society?”

      Venn diagram of how that could possibly be please.

      1. John

        Self loathing is not that unusual among the profoundly abused, if it goes on long enough. Especially if constant degradation is part of the abuse. Check out Douglas Blackmon’s “Slavery by Another Name”

        1. optimader

          sorry, self-loathing is not a synonym not for racism

          a belief or doctrine that inherent differences among the various human races determine cultural or individual achievement, usually involving the idea that one’s own race is superior and has the right to rule others.

          hatred or intolerance of another race or other races.

      2. allcoppedout

        Slavery is not what most of the public think and the same is true for racism. We blokes are suckers for a pretty face unless we take certain types of anti-depressants. Loads of lab tests show ‘racism’ is in deep. There are long traditions in Africa of the domination of one tribe by another. Nigeria still has wars where slaves are taken, often for sex. White slaving was much more common than most of us know. The total was in millions from the Russian Steppe alone (Moscow was sacked in a Crimean Tartar slaving raid in 1751). The black Dahomey tribe were extensive slave traders supplying vile Europeans. The Bombardment of Algiers in 1816 by British and Dutch was to release 3000 white slaves and this was not the end of Barbary Coast raiding. The whole of history is riddled with the muck and various ethnic genocides (though in many of these it’s the same ethnic on ethnic – Russians and Ukrainians are both East Slavs). The question we should be asking is how much slavery still reverberates in echonomics.

        1. John Jones


          Can you expand about this?
          “We blokes are suckers for a pretty face unless we take certain types of anti-depressants.”

    5. kareninca

      This is another account of what Bundy said: it purports to be an unedited version:

      The NYT and the LA Times are clearly committed to making him look like an evil racist, and I don’t see a lot of their readers trying to find out if that is actually true. I’ve certainly known a lot of rural white people who were not racist at all, but who did not use the usual liberal “PC” words.

      I’m not saying that the “real” Bundy assertions are right! But they are very different from what the NYT and LAT are showing with their convenient editing. It almost seems that they WANT black and Hispanic people, to think that rural whites hate them. Hmmm.

      1. nobody

        You can see the whole video at this link below. It’s from the day after they had a party. He basically says they had a great party with lots of freedom, but “you look around and we’re all basically… white people. Where is our colored brother? Where is our Mexican brother? Where’s our Chinese… where are they? They’re just as much American as we are.” It is quite obvious that his concern is with how to get more racial and ethnic diversity involved. The segment where he’s talking about race ends with him saying “and we need to have those people join us and be with us, not…. not not coming to our party.”

      2. Lambert Strether Post author

        The About Page puts the Editor in the Brietbart axis. That’s a problem, given that Breitbart-ists are, shall we say, instrumental in their approach. It’s unfortunate that provenance is an issue wth anything digital, but so it must be.

    6. hunkerdown

      It’s a big surprise because Good Americans shouldn’t want to criticize other Good Americans.

      Hmm. Looking at it that way, insider omerta might be a broader social dynamic, not just a flexian thing.

  2. Jim Haygood

    From Gillian Tett’s FT article about America’s GSEs:

    ‘The good news is that Congress is now finally trying to address this situation: on Tuesday a Senate committee is expected to approve a reform bill. Better still, this legislation commands bipartisan support, from a Republican senator (Mike Crapo) and a Democratic counterpart (Tim Johnson).’

    Ah ha ha ha … there is no such thing as ‘reform’ from the Depublicrat party, especially when it’s ‘bipartisan.’ Indeed, Tett admits in the very next line that ‘the bad news is that radical change seems unlikely.’ Well of course, dear. There are important interests to protect. So why the ritual, counterfactual boilerplate?

    No doubt the MSM will keep hawking their ‘bipartisan reform’ myth until the presses are sold as scrap iron and the frayed-cuff journos packed off to the knackers.. Don’t feed the MSM!

  3. Cal

    From Vermont article:
    “Genetically modified crops have been altered to be resistant to insects, germs or herbicides. They have led to bountiful crops and food production”

    Sure, just like throwing a cup of gasoline onto a fire leads to bountiful flames.
    You get a quick burnout of the soil which gets poisoned by Roundup residue and the bounty soon disappears as the plant pathogens adapt to the GMO contamination of the crops. “Resist germs?” Not even Monsanto claims that.

    “Resist herbicides?” Yup, meaning the crops are doused in them and you get residue of them in every bite. Roundup is now linked to cancer.

    After the GMOs survive digestion your own stomach flora start making the pesticide in your stomach that causes insects to die when they munch the corn.
    Can’t wait to see the justification that the corporate whores in the USDA will use to ban American’s right to know what they are eating.

    1. Johann Sebastian Schminson

      Can’t find the link, but someone once demonstrated that GMO crops do not increase yield. They do, however, lessen the costs involved in producing food crops. Once again, it’s not about feeding people — it’s about how much profit there is to be made in doing so.

      1. Cal

        Nice attempt at inserting corporate disinformation in here.
        “Lessen the costs”…
        after you pay the yearly seed licensing fee to Monsanto, no seed saving allowed! Buy the Roundup, the protective equipment for the sprayers and lose access to the high quality, high value organic market? You strip the soil of microfauna and life with toxins?

        Organic produces more revenue per acre than does conventional ag.

        “A growing number of farmers are abandoning genetically modified seeds, but it’s not because they are ideologically opposed to the industry.

        Simply put, they say non-GMO crops are more productive and profitable.

        Modern Farmer magazine discovered that there is a movement among farmers abandoning genetically modified organisms (GMO) because of simple economics.

        “We get the same or better yields, and we save money up front,” crop consultant and farmer Aaron Bloom said of non-GMO seeds. Bloom has been experimenting with non-GMO seeds for five years and he has discovered that non-GMO is more profitable.

        The re-converts to non-GMO seeds are not hippies but conservative Midwestern farmers who are making a business decision, Modern Farmer discovered. They are switching back to natural seed because it is more profitable — not because of any ideology.

        “Five years ago the [GMO seeds] worked,” said farmer Christ Huegerich, who along with his father planted GMO seeds. “I didn’t have corn rootworm because of the Bt gene, and I used less pesticide. Now, the worms are adjusting, and the weeds are resistant. Mother Nature adapts.””

        1. Johann Sebastian Schminson

          Are you accusing me of parroting a corporatist line?

          If so, you are grossly mistaken.

          WTF does your comment say that mine does not?

          I read your comment, again, and all I can really say is that you should simply fuck off.

          1. Cal

            “They do, however, lessen the costs involved in producing food crops.”

            That’s a corporate line. Be a gentleman.

            1. Johann Sebastian Schminson

              “Can’t find the link, but someone once demonstrated that GMO crops do not increase yield. ”
              You got a problem with that?

              Be a gentleman? Perhaps you should. Gentlemen do not make unfounded accusations, such as yours.

              GMO foods are cheaper for corporate “farmers.” Period. They result in less input costs (labor, alternative pesticides, and energy inputs, to name a few. Do they despoil everything else? More than likely. Do they increase crop yields? No. Do they increase profits? Yes (otherwise, what’s the point?).

              Before you throw your feces on another (simian behavior, if ever there was), you would be very wise to expect an equal, but opposite, reaction — or worse.

              Interesting that my original comment was — or was intended to be — in agreement with yours.

              I reiterate my advice to you.

              1. GusFarmer

                This doesn’t directly state GMOs increase costs, but it clearly implies that based on the fact farmers use more pesticides to deal (badly) with increasingly resistant weeds and insects: Benbrook study

                1. McMike

                  The argument was certainly made that they increase yields with less loss.

                  If they were ever purported to reduce costs to the farmer, that has surely been disproved by now.

                  One might have tried to argue that the higher yields exceed incremental technology/input costs.

                  They are yet one more mechanism to transfer wealth from farmers to the seed/petro companies, while externalizing the damage.

              2. optimader

                “GMO foods are cheaper for corporate “farmers.” Period. —Do they despoil everything else? More than likely. ”

                I think what you more precisely mean to claim is that GMO crops allow corporate farmers to externalize cost –depreciate other farmers property and damage “The Commons”).

                Do Monsanto GMO crops genetically contaminate adjacent non-GMO crops?
                Did Monsanto claim that would never happen?

                1. allcoppedout

                  Didn’t they take some poor sods to court saying they must have planted GMO to have any in their fields and win at some point Opti?

                  1. optimader

                    Yes , Monsanto was (is?) filing lawsuits against farmers downwind for unlicensed use when GMO genetic material shows up in a non client crops.

                    The damned thing is, like many man-made isotopes releases, heavy metal aerosols (tetraethyllead, cadmium, mercury etc etc), once in the environment essentially infinite persistence .

                  2. hunkerdown

                    Worse. SCOTUS held that “acts of God,” such as normal plant reproduction, are no defense against patent infringement.

                    SCOTUS under Roberts is a textbook example of preferential attachment.

                    1. hunkerdown

                      My bad… SCOTUS hasn’t heard the free-pollination issue yet, just the seed-saving issue. As to free-pollination, Monsanto has reportedly made “binding assurances” (lol) not to sue organic farmers for traces of GM pollution of organic food. How kind, I guess.

                      The knowledge economy is dead. Long live the permission economy, or something.

  4. Frances

    Apologies if someone else has mentioned this today. In a 4/25 NYT “Times Insider” interview with Gretchen Morgenson, she’s asked what she reads everyday:

    “It includes The New York Times, The Wall Street Journal, Bloomberg News and the must-read financial blogs Zero Hedge and Naked Capitalism. I also read a lot of company financial filings, research from various banks within the Federal Reserve System, the Government Accountability Office and market commentary from money managers I respect. Twitter keeps me current on breaking news.”

  5. Jim Haygood

    The London Gherkin goes bust:

    ‘International investors will be lining up to bid for London’s iconic, cucumber-shaped skyscraper known as the Gherkin after lenders to the building appointed receivers yesterday to end years of defaults.’

    How in the hell can a fully-rented building in one of the world’s pre-eminent business districts default? Two reasons are cited:

    ‘Part of the loan that IVG’s fund used to buy its share of the building was in Swiss francs, which have gained about 63 percent against the pound over the last seven years. Office values in London fell by more than 45 percent from the peak of the market in June 2007, shortly after Evans Randall and IVG bought the Gherkin, through September 2009.’

    Well, duh. Buy at the peak of the market, using hard-currency financing for leverage, and what do you think’s gonna happen?

    A competent feng shui consultant could have snapped the buyers out of their ithyphallic mesmerization.

      1. allcoppedout

        Well, Prince Charles did call it a carbuncle. Hardly surprising it should burst. I shall weep tonight!

    1. McMike

      Does anyone actually still argue with a straight face that once the postal service is killed we’ll get better service for lower cost?

      1. Larry Barber

        What service? All I get in the mail are bills (which could just as easily be emailed) and third class junk. The third class crap goes straight into the trash. I can’t remember the last time I mailed anybody anything. If the Post Office went belly up, I wouldn’t miss it, it would save me the hassle of separating my bills from all the advertisements.

        1. different clue

          I get and pay all my bills by landmail to help keep the post office alive. What if 20 million other e-bill payers went pack to landmail billing?

        2. McMike

          What makes you think a private postal service wouldn’t have ads? Have you used the internet lately?

          1. different clue

            It would be harder for the NSA to read a hundred million letters than a hundred billion emails.

  6. JohnnyGL

    Hey, anyone else looking at that Wolf piece? Has the man straight-up embraced MMT? Wow, that’s a big deal for someone with his kind of credibility to get on board.

    1. financial matters

      Actually, I think this response to the Wolf piece is more in line with MMT thinking.

      By Ann Pettifor, 26th April, 2014.

      Ann is author of “Just Money: how society can break the despotic power of finance”, published by Commonwealth, 2014.

      “Now many environmentalists want to restrict economic activity – and I agree with them. The creation of “easy” i.e. unregulated money has fuelled unsustainable consumption. Worse, credit has been directed at inflating the value of assets (e.g. property) that have enriched the rich, and impoverished those who do not on the whole own assets. Easy credit has been at the heart of the rise in inequality in western economies.

      But while we may want to limit consumption, and re-direct credit to more sustainable, useful activity, it would be a mistake to limit the things that society can do. We need, for example, to tackle climate change, a major threat to a liveable future. That will require huge resources to be directed at transforming and de-carbonising the economy. Carefully managed and regulated credit will help finance those activities. The money in our piggy banks would be woefully insufficient.

      This debate exposes a profound misunderstanding at the heart of economics, one heavily promoted by monetarists and the Austrian school: namely that it is possible to manage aggregate economic activity within an economy like Britain’s if an “independent committee” can just pre-determine money growth, and then shrink or expand activity.

      This is very close to what monetarists tried to achieve, but failed to do under Mrs Thatcher.

      It is also what economists and bankers tried to achieve under the Gold Standard. Then aggregate economic activity was expanded or shrunk to (apparently) equal a quantity of gold buried in the vaults of central banks. The result was predictable: a shortage of money, economic failure, instability, financial and currency crises and rising unemployment.”

  7. Massinissa

    “Nevada rancher Cliven Bundy’s battle against the federal government over land rights took an unexpected detour after a newspaper quoted the 67-year-old grandfather suggesting African Americans were “better off as slaves” because slavery taught work skills and enhanced family life.”

    If being enslaved enhances family life, why dont we try in on Cliven Bundy and see how it works? I mean, if slavery is so great and wonderful for slaves clearly Bundy would want to try it right? Right?

    Seriously, if slavery is so damn wonderful, why in gods name wouldnt people want to volunteer for it?

    And wait just a f*cking minute… How does Slavery ‘enhance family life’ when family members can easily be sold to other plantations?

      1. allcoppedout

        One could taken old Cliven to be a progressive, merely stating how lousy welfare life is. Suppose not.

  8. Paul Niemi

    I saw the link to Hillary. My thought: Is there no mercy? Now we are going to have thirty long months, of course, of Clinton, of Bush, the names repeated everywhere, on every page, in every location, all the time. So Bloomberg says she is raising and spending half a million a month, and the placed story would send a message to anyone else who would hazard to even think about joining the race. And I can’t recall anything notable the lady has ever said or done in her life, but that is my problem. Same with Jeb, so we’ll be served the right Bush son this time, and I can’t think of anything notable he has ever said or done in his life, but that is also my problem. Apparently I just need to be educated. Send me to the camp, I’ll pack my bag.

  9. Katniss Everdeen

    RE: A fatal wait: Veterans languish and die on a VA hospital’s secret list

    “Doctor: It’s a ‘frustrated’ staff

    “I feel very sorry for the people who work at the Phoenix VA,” said Foote. “They’re all frustrated. They’re all upset. They all wish they could leave ’cause they know what they’re doing is wrong.

    “But they have families, they have mortgages and if they speak out or say anything to anybody about it, they will be fired and they know that.”

    What a country. They KNOW they’re doing something wrong, but they have MORTGAGES.

    What if “they” threw a war and nobody came? McCain and Graham would probably have heart attacks. GOOD RIDDANCE OF BAD RUBBISH.

    Put ’em on the secret list.

    1. allcoppedout

      Strangely, one doubts any of the people we have slaughtered over the years to protect our way of life would think much of the excuse ‘we’re only here to pay our mortgages’. I suspect we only have to pay them in order that they can send some of us to do the dirty end of their business.

  10. Romeo

    Hello Yves,
    Great content on daily basis. Thank you very much. I have been reading Milton Friedman’s “Free to Choose” and he regards socialized medicine is a bad idea. I totally agree that Doctors will be our new teachers. No one other than poor go to public schools and no one again other than poor will go to the hospitals. Can you guys recommend a good book on socilization of Healthcare, Social security, Education. Are britain and canada happy with socialized medicine? What is at stake here?

    1. JEHR

      I am a Canadian and I love our Universal Health Care Single-Payer system. However, we have a PM who is doing his best to weaken that system through payments made based on population and not on the needs of poorer provinces. He will eventually starve our system and the system requires a lot of attention so that it doesn’t become two-tiered.

      1. kj1313

        The US will keep reminding our northern neighbors what can go wrong if you head down that path.

    2. Ed S.

      So Romeo/Rahul,

      If you’re serious, I suggest that you look to the right side of this web page and click on “Health Care (212) and start at the first post. Those posts will answer (along with the comments) the majority of your questions about “socializing health care”. I’d also consider rephrasing your question from ” Are Britain and Canada happy with socialized medicine” to “What does every other industrialized country know about the delivery of health care and how do they get equal or superior results for substantially less money than the US?”

      Finally, while Milton may have said (or you may conclude) that “No one other than poor go to public schools” I’d suggest that you confirm with any real estate agent that the quality of schools in a geographic area are irrelevant since nobody but poor people attend them.

      I’m sure some others may have suggestions as well. Good Luck!

  11. nobody

    “Nice to see the ‘state’s rights’ / ‘slavery as a positive good’ talking points of pre-Confederate political theorists morph right into libertarian/conservative talking points.”

    I’ve listened to the quote in context. Cliven Bundy didn’t say what you seem to think he said. What’s happened here is similar to what Breitbart did to Shirley Sherrod.


    1. nobody

      Notice how distorted and untruthful a picture is being given in the LA Times on Cliven Bundy. On their account:

      Over the weekend, Bundy spoke to supporters about general issues involved in the standoff. Suddenly, he took a turn and began discoursing on African Americans and public welfare. ‘I want to tell you one more thing I know about the Negro,’ he said in comments quoted by the New York Times.

      In reality:

      Anyway, we got work to do, and what a…a opportunity. What a… what a party we had last night, and… what freedom we’ve got today. There’s one thing that was on my mind, though, and through this whole thing… last night. You look around and we’re all basically… white people. Where is our colored brother? Where is our Mexican brother? Where’s our Chinese… where are they? They’re just as much American as we are. And we’re not… they’re not with us. If they’re not with us, then they’re going to be against us.

      I wanna… I’ve been raised in this little community, and hardly ever seen a black man until I was almost a teenager. But let me tell you an experience. I lived in California during the Watts riot.

      After a lengthy, detailed recounting of his experience in the Watts riots, he continues:

      …and so what I testified to you, I was in the Watts riot. I seen the beginning fire and I seen the last fire. What I seen is civil disturb…disturbance. People are not happy. People are thinking they don’t have their freedoms, they don’t have these things. And they DIDN’T have them. We’ve progressed a good bit from that day till now. And we sure don’t want to go back. We sure don’t want these colored people to go back to that point, we don’t want these Mexican people to go back to that point. And we can make a difference right now by taking care of some of these bureacracies. And do it in a peaceful way.”

      The gist of his comments is that everybody is being oppressed by bureaucracies and bureaucratic processes, productive work is broadly declining (through outscoring of manufacturing jobs, policies developed to drive ranchers off the range, and so on) even as there is so much work to do. He says he thinks we’re all in this together — all here are “just as much American as we are.” He wants progress for everybody — for all to enjoy freedom, liberty, to follow his or her individual conscience, be able to create and move about freely, have religious freedom, and enjoy life here on earth. Towards that end, he hopes to see more racial and ethnic diversity at the next Bundy Ranch party (INCLUDING those who’ve “come over here against our constitution”):

      Now let me talk about the Spanish people. You know, I understand that they come over here against our constitution and cross our borders. But they’re here and they’re people – and I’ve worked side-by-side a lot of them. Don’t tell me they don’t work, and don’t tell me they don’t pay taxes. And don’t tell me they don’t have better family structures than most of us white people. When you see those Mexican families, they’re together, they’re picnicking together, they’re spending their time together, and I’ll tell you in my way of thinkin’, they’re awful nice people. And we need to have those people join us and be with us, not…. not not coming to our party.

      1. bob

        How was he in CA for the Watts riots if he is claiming legacy ownership of a piece of “homesteaded” land?

      2. Lambert Strether Post author

        What’s the provenance of the video? Interesting, if true. I don’t have any issue in principal with the idea that the Democratic nomenklatura would fake evidence, but I’d like to nail it. Thanks!

  12. F. Beard

    The purpose of allowing usury from foreigners in Deuteronomy 23:19-20 (and no debt forgiveness in Deuteronomy 15) was to enslave them either individually or as nations – ostensibly for their own good – and there’s some logic to that.

    But what isn’t logical or good is to allow a class of crooks, thieves and embezzlers to loot and enslave the rest of us VIA GOVERNMENT PRIVILEGE and moreover drive the world into trade and actual warfare.

  13. Propertius

    Re: Martin Wolf and the banks

    This, of course, was all foreseen by William Jennings Bryan in his “Cross of Gold” speech:

    He says that we are opposing the national bank currency. It is true. If you will read what Thomas Benton said, you will find that he said that in searching history he could find but one parallel to Andrew Jackson. That was Cicero, who destroyed the conspiracies of Cataline and saved Rome. He did for Rome what Jackson did when he destroyed the bank conspiracy and saved America.

    We say in our platform that we believe that the right to coin money and issue money is a function of government. We believe it. We believe it is a part of sovereignty and can no more with safety be delegated to private individuals than can the power to make penal statutes or levy laws for taxation.

    Mr. Jefferson, who was once regarded as good Democratic authority, seems to have a different opinion from the gentleman who has addressed us on the part of the minority. Those who are opposed to this proposition tell us that the issue of paper money is a function of the bank and that the government ought to go out of the banking business. I stand with Jefferson rather than with them, and tell them, as he did, that the issue of money is a function of the government and that the banks should go out of the governing business.

  14. Chauncey Gardiner

    Thank you for the link to the article from The New Inquiry titled “Disgorge the Cash”.
    I was disappointed that the author failed to address the role that Fed “T+1” QE-ZIRP money and an opaque pass-thru process to lard up major corporations with debt in order to fund these enormous corporate stock purchases, pay out dividends, and fund “friendly” legacy party politicians have played in perpetuating the “virtuous cycle” in this caricature of capitalism. Seems to me the only missing component in this broken Fed “Wealth Effect” money transmission mechanism is state ownership of these corporations we’re all indirectly funding for the benefit of a small segment of population.

    Before being dashed by the author in his final paragraphs, my hopes for a paradigm changing viewpoint were initially raised by the author’s observations:

    … “In the period from 2002 to 2008, net corporate borrowing rose from 1 percent to 6 percent of GDP. But unlike in earlier episodes of rising corporate borrowing, payouts rose point for point with borrowing. By the end of the boom, corporations were paying out more than 100 percent of their cash flow to shareholders. So on net, corporations raised no net funds from financial markets. The money that flowed in the front door as new borrowing flowed right out the back as higher dividends and share repurchases.”

    … “Under these conditions, the idea that fixing the financial system will boost growth and employment in the rest of the economy amounts to pouring water into a bucket that is already overflowing, and is also shot through with holes.”

    … “The change in the use of corporate funds helps explain one of the outstanding puzzles of the Great Recession: the lack of any clear connection between the financial crisis and the steep contemporaneous fall in corporate investment.”

    I suggest the author reconsider his view that the sole purpose of the financial markets is to provide a “liquidity” exit in responding to the desire of the rentier class for immediate cash against a broader social context of the responsibilities of these human organizations/legal constructs – corporations – to their stakeholders other than shareholders: their employees, the communities in which they conduct their operations, and society as a whole. It’s about balance and values.

  15. GTF

    MEETUP. Oh let me just copy/paste:

    Please Join Us at Our NYC Meetup Next Friday, April 25
    Posted on April 19, 2014 by Yves Smith
    I hope readers in New York will be able to join us at an informal gathering next Friday, April 25, from 5 PM to 8 PM. The venue is Sláinte, which bills itself as a modern Irish pub. That means it has a big selection of craft beers, good wines by the glass, and better food than the usual bar fare.

    The NYC meetup is at 304 Bowery, between Bleecker and Houston, so the nearby train stops are the B, D, F and M at Houston and the 6 at Bleecker, or the F at Second Avenue.

    1. craazyman

      Frustrated I won’t be able to check out the scene at Slainte tonight. It sounds tres cool, if anything in Manhattan can be cool anymore,. haha. If anything in it can be, then this scene sounds like it will be. It’s a 6 a.m. train tomorrow to DeeCee for me. If there are any embarrassing stories of drunkenness and loss of self-control at the event, I hope somebody posts about it so everybody in the peanut gallery knows.

      1. allcoppedout

        We had a rash of fake Irish pubs over here. They are all gone, complete with the fake, sprayed dust. I suspect they have legged it to the North Cork Bush to haunt Dork. I’m off to walk the dog in the Lake District to see if he learns to write poetry.

  16. Synopticist

    A comment on the net neutrality story…

    “How disappointing. I backed Obama for two elections. I cannot believe he would break THIS promise…- the internet belongs to all of us, not corporate America”

    I know I shouldn’t laugh, but some people really haven’t got the whole contemporary politico/economic reality thing figured out, have they?

    1. Propertius

      Even if they didn’t have “the whole contemporary politico/economic reality thing figured out”, they should have seen this coming when he flipped on telecom immunity in 2008.

  17. Glenn Condell

    My Anzac Day present came a day late, but it was worth the wait:

    Former conservative Australian Prime Minister (Thatcher/Reagan era) Malcolm Fraser, the man who connived in the dismissal of Gough Whitlam, has just released a book which calls for Aust to cut ALL military ties with the US. His journey from sinner to saint is almost complete. The old saw ‘the older you are, the better you were’ is working in reverse for him.

    Background and interview from Robert Manne:

    ‘Fraser, the most pro-American of all Australia’s leaders during the latter stages of the Cold War, began to question, with a critique no less withering than that of his former enemies on the left, the character of almost every aspect of America’s international behaviour: its narcissistic self-image as the light unto the world, its imperial arrogance, its systematic abuse of military power.’


  18. spooz

    Availability of reserves would not a concern if citizens had interest free fiat storage with the US government, at the federal reserve or through postal banks. Those that want to risk their money in the markets could use the private banking system.

    MMT has much more wishful thinking involved, imo, like seigniorage based on debt money, particularly when private banks are in control of endogenously creating our money and the debt component comes only after these banks have created new deposits. Having the government underwrite TBTF banking activities is a subsidy that MMT does not concern itself with. Real seigniorage would come from government issued debt free fiat, imo, which has nothing to do with a gold standard.

    It might help to read up on it before making comments that don’t apply.

  19. WorldisMorphing

    New Inquiry’s “Disgorge the Cash” post was quite a good enlightening read…

    [“The change in the use of corporate funds helps explain one of the outstanding puzzles of the Great Recession: the lack of any clear connection between the financial crisis and the steep contemporaneous fall in corporate investment. Even the most sophisticated research finds that access to bank credit helps explain the fall in investment spending only for small firms. But it’s the largest firms that are responsible for the large majority of borrowing and investment. In 2009-2010, investment fell by as much at the largest businesses, and at debt-free businesses, as at small bank-dependent businesses. If the financial crisis interrupted the flow of credit only to small, bank-dependent businesses, it can explain at best a small part of the collapse in business investment after 2008.

    Paradoxically, outside finance matters less for corporate investment decisions even as firms rely on it more. If shareholders effectively exercise first claim on every dollar that comes into the firm, it doesn’t matter whether borrowing is cheap and easy or hard and expensive. All that changes is the amount flowing out the door. Firms’ investment decisions, then, don’t depend on current earnings or credit conditions; they depend on whether management can propose projects with high enough returns to convince shareholders to leave “their” money inside the firm. The challenge is keeping money from flowing out of the firm, not bringing it in.

    Under these conditions, the idea that fixing the financial system will boost growth and employment in the rest of the economy amounts to pouring water into a bucket that is already overflowing, and is also shot through with holes.”]
    [“As Keynes understood, liquidity is what stock markets are for. What they’re not for is raising funds for investment. Consider a recent example: Groupon. Their IPO raised $700 million. So the people who bought shares are getting ownership of the company in return for providing it much needed funds for expansion, right?

    Except that, as Reuters columnist Felix Salmon points out, “Groupon has been shouting until it’s blue in the face that it doesn’t need the IPO cash.” Its cash flow was more than enough to finance all foreseeable expansion plans. So why go public at all? Because existing investors want cash. Pre-IPO, Groupon was already notorious for using venture-capital funds to cash out earlier investors. But the venture capitalists need to be cashed out in their turn.

    And that’s what Wall Street is for: to give capitalists their exit. “]

    –and finally —
    [“Keynes’s call for the “euthanasia of the rentier” toward the end of The General Theory is typically taken ad a playful provocation. But as Jim Crotty has argued, this idea was one of Keynes’s main preoccupations in his political writings in the 1920s. In his 1926 essay “The End of Laissez Faire,” he observed that “one of the most interesting and unnoticed developments of recent decades has been the tendency of big enterprise to socialize itself.” As shareholders’ role in the enterprise diminishes, “the general stability and reputation of the institution are more considered by the management than the maximum of profit for the shareholders.” With enough time, the corporations may evolve into quasi-public institutions like universities, “bodies whose criterion of action within their own field is solely the public good as they understand it.” Veblen, observing the same developments but with a less sunny disposition, imagined that the managers of productive enterprises would eventually tire of “sabotage” by the notional owners and organize to overthrow them, seizing control of production as a “Soviet of engineers.”

    The function of finance is to keep this from happening.”]
    You forgot to label it “Today’s must read “, and you should be severely reprimanded for it Lambert…

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