Links 3/12/15

Gator pays golf course a visit 10 News

New Evidence Suggests Last Ice Age Caused By Earth Floating Into Extremely Chilly Part Of Galaxy Onion (David L)

Variable Stars Have Strange Nonchaotic Attractors Quanta Magazine (Chuck L)

Open-source hardware is gaining critical mass Computerworld (Chuck L)

Documents Detail Sugar Industry Efforts To Direct Medical Research NPR (David L)

Apple’s high-stakes negotiations with the Chinese government could complicate Obama’s tough talk on snooping Quartz. So Apple is perfectly fine with throwing Chinese dissidents under the bus to secure an advantaged position in China. The defiance of the Administration is particularly cheeky given that Apple is a bigger beneficiary of government R&D than Google (see Mariana Mazzucato’s The Entrepreneurial State for details).

Global Capital Heads for the Frontier Dani Rodrik, Project Syndicate (David L). Rodrik has argued for capital controls in emerging economies, and makes his case here.

BOJ Aggressively Buying Japanese Stocks Wall Street Journal (EM)

That euroglut outflow and the real Japanisation of Europe FT Alphaville. Important.

Global finance faces $9 trillion stress test as dollar soars Ambrose Evans-Pritchard, Telegraph

Dollar surge poses policy dilemma for Fed Financial Times

This is historic: The dollar will soon be worth more than the euro Washington Post (furzy mouse). Well, no, it has traded as low as .89….


Syriza’s Only Choice: A Radical Step Forward The Bullet. Nikki: “The authors are professåors of political economy and members of the central committe of Syriza.” A lot of good analysis here, such as, “This fact widely signaled that the Greek government might not not have any stable negotiation strategy,” but its remedy seems a tad idealistic.

Wolfgang Schaeuble the Salesman Ed Harrison

German, Greek tensions extend to World War II dispute Aljazeera (Bob H)

Greece’s Bank Bailout Fund: What’s Happening? WSJ Real Time Brussels

Greece Bailout Talks: A Glossary WSJ Real Time Brussels. New euphemisms. Lordie.


IMF aims for ‘immediate’ stabilization with latest Ukraine bailout deal Reuters. Jim Haygood: “What a catastrophe. One couldn’t design a more certain train wreck.”


Why Obama’s Hopes Of Decapitating The Islamic State Won’t Work Andrew Cockburn, Counterpunch

Leak investigation stalls amid fears of confirming U.S.-Israel operation The Washington Post (furzy mouse)

Herzog Lead Over Netanyahu Increases to 4 Seats Daily Kos (furzy mouse)

Big Brother is Watching You Watch

New smoking gun further ties NSA to omnipotent “Equation Group” hackers ars technica (Chuck L)

Cellphone tracking technology comes to Los Altos Hills Los Altos Town Crier (Balaji). “’So, just to be clear,’ [county supervisor Joe] Simitian said, ‘we’re being asked to spend $500,000 of the taxpayers’ money plus $42,000 a year thereafter today for a product, the brand name of which we’re not sure of, the product specs we haven’t seen, a demonstration we don’t have and we’ve got a nondisclosure requirement as a precondition?’”

Imperial Collapse Watch


Postcard from the End of America: Washington D.C. CounterCurrents (RR)

Obama’s Selma Song: America Is Not Racist – It’s Just Ferguson Glen Ford

House Panel Prepared to Subpoena Over Hillary Clinton’s Emails Wall Street Journal

Illinois, unions duel over pensions in state’s high court Reuters (EM)

Chris Christie Maintained State Pension Investments In Prudential After Top Official Gave Contributions International Business Times

New Jersey worst state for public pension funding: report Reuters (EM)

Utah Passes White-Collar Felon Registry New York Times

Two Officers Shot During Protest Near Ferguson Police Department NBC (furzy mouse). Uh oh.

New York Hedge Funds Pour Millions of Dollars into Cuomo-Led Bid to Expand Charter Schools Democracy Now

Treasury Urged to Scrutinize Foreign Real Estate Buyers for Money-Laundering Risk New York Times

Wall St. banks launch massive buybacks, boost dividends USA Today

Deutsche and Santander fail US stress test Financial Times

GE Weighs Deeper Cuts to Capital Business Wall Street Journal

Fed Inspector General Reopens Leak Investigation ProPublica. Sure looks like Fed general counsel Scott Alvarez sat on it.

Class Warfare

How income fraud made the housing bubble worse ScienceDaily (Chuck L)

“Trade” Deals

The Trans-Pacific Partnership and China’s Reality Triple Crisis

TPP at the NABE Paul Krugman. Krugman comes out forcefully against the TPP, and is also denying Larry Summers what look to be his efforts to define the left flank of respectable opinion. Krugman, as a trade economist, nixing a soi-disant trade deal, is hard to ignore. Peculiarly, he ignores the sovereignty-underminig investor-state dispute settlement panels, but finds more than enough to dislike in the intellectual property provisions.

The Dangers of Intelligence without Creativity or Judgment Ian Welsh. One minor quibble re Larry Summers: even though he is famed for his intelligence, having seen him in action, his reputation rests at least in part on his debating skills (and being a highly dominant personality). Despite economics’ fetishization of mathematics, it also prizes argumentation (without, as debaters would, giving demerits for tricks like straw manning and ad hominems, which Summers uses routinely).

There Are Nearly Six Unemployed Construction Workers for Every Construction Job Opening American Prospect

Antidote du jour. Andrea: “Marine birds being beautiful at last week’s big blizzard. Tough little guys but always so elegant, even screeching!”

sea gull in snow links

See yesterday’s Links and Antidote du Jour here.

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  1. Steve H.

    Ian: “Around about 4 standard deviations IQ starts to go really off tracks without #3 [judgment], because at that IQ level people can make connections between almost anything, the pattern recognition is in overdrive.”

    Archdruid making resonant points: “There’s a common notion that dealing in abstractions is the hallmark of the intellectual, but that puts things almost exactly backwards; it’s the ordinary unreflective person who thinks in abstractions most of the time, while the thinker’s task is to work back from the abstract category to the raw sensory data on which it’s based. That’s what the Impressionists did: staring at a snowbank as Monet did, until he could see the rainbow play of colors behind the surface impression of featureless white, and then painting the colors into the representation of the snowbank so that the viewer was shaken out of the trance of abstraction (“snow” = “white”) and saw the colors too—first in the painting, and then when looking at actual snow. . .

    The externalization of the human mind and imagination via the modern mass media has no shortage of problematic features, but the one I want totalk about here is the way that it feeds into the behavior discussed at the beginning of this post: the habit, pervasive in modern industrial societies just now, of responding to serious crises by manipulating abstractions to make them invisible.”

    1. James Levy

      When, for credibility and mental comfort you want to put a number on everything (as in, I’ll take Climate Change seriously when you can tell me exactly what percentage of the change in human-induced, how bad it will get, and exactly when it will get that bad) then obfuscating the evidence that does exist and dismissing material reality because you can’t quantify it are neat, soothing tricks. The fact that there is a positive feedback loop for certain kinds of obfuscation (as in poverty isn’t really bad and is the fault of individuals anyway, racism doesn’t exist anymore or if it does then blacks are just as racist as whites so it doesn’t matter, or the wonderful money isn’t the answer to improving education but I send my kid to a $25,000 a year private high school but that has nothing to do with the issue so mentioning it is just an ad hominem attack in bad taste) just makes it inevitable that people with brains and no conscience will opt to take their 30 pieces of silver and muddy the water. When wealth was much more concealed and much less concentrated 50 years ago the temptation to generate verbiage to defend the indefensible was much weaker. Today, with average academic salaries having about the purchasing power they did in 1970 and so many endowed chairs, think tanks, and whole departments riding the gravy train of intellectual whoredom, it’s tougher not to be a shill than it is to be one.

      1. Steve H.

        Yves arguments is ‘ECONned’ were critical for me in understanding that the cognitive capture in the finance industry is a deeper problem than simple grifters-n-greed. I find that the use of the mean, when talking about average wages (f’instance), is a perspective which consigns most people to the shame-&-guilt of not even being ‘average’, when the median is the robust marker, not subject to the remarkable outliers of the status quo.

        Putting a number on it still reveals a particular perspective.

    2. JEHR

      Steve, I have to disagree with you here. When the sun is shining on new fallen snow, each flake takes on a different colour (depending, perhaps, on the wave length of the white light hitting the flake). You can actually see each colour on each individual flake and these vary from yellow, to blue, to green, to red, etc. If you stare at these flakes, you see the actual colours which make up the white snow. The colours are REALLY there, not imagined or abstracted. Try it sometime!

      1. Steve H.

        No disagreement, Greer is actually saying that ‘snow is white’ is the abstraction, and the glints are the reality. And they are very beautiful.

    3. MyLessThanPrimeBeef

      That raw sensory data is or those raw sensory data are also abstractions in our brains.

      1. Steve H.

        There’s a physical truth there beyond rods and cones, in that the optic neuronal system has already used lateral inhibition to ‘sharpen’ the image before it gets near the brain.

        1. MyLessThanPrimeBeef

          We abstract that which is out where (‘physical truths’) as sensory data, that is, sensory data are abstractions.

          The concepts of soft, rough, color, weight, speed – these concepts, and the sensations we get based on these concepts, they are all our abstractions.

          1. Steve H.

            Hmm. I’d say the sensations are the figurative data, but that flood of sensory input is processed to decrease the total amount of information, by perceiving patterns. The patterns are necessarily biased, selectively decreasing the quantity of data by increasing the contrast between perceived boundaries.

            Those patterns are abstractions, and can be combined to make more abstractions (red cone + blue cone = ‘purple’). This allows for greater nuance and quicker processing time, which gets selected for. But it seems the higher the level of abstraction, the easier it is to misapply. What all these authors seem to be saying is that the higher the level, the more is lost, and the less able we are to see the bias.

            1. MyLessThanPrimeBeef

              That’s the point.

              And we do that (distort) all the time…with words for what-is in Nature and we pile words upon words, so that, often what we write or say has little to do with the world.

              Then, there is another way, like when we react instinctually or intuitively.

    4. craazyman

      The snow’s pretty darn white in the Monet paintings. maybe there’s something wrong with the color calibration on the dude’s computer monitor. sometimes you get weird color shifts when monitors haven’t be properly calibrated, like white comes out looking pink or purple or violet-gray looking,

      It could be a mistake of electronics.

      Snow really is white. It really is! If somebody paints it green and red they’re delusional, unless a green and red light is shining on it. In that case, it may not be exactly white. But the sun is yellow, not green and red. It’s only green and red if you have a prism. And then it’s not the sun, it’s the prism.

      Snow could be red if it’s the evening sun, or the morning sun. But mostly it’s white or yellow. It could be blue, if the sky is very blue. but it’s still a white blue, unless it’s in the shadows of a tree. And then it’s a gray blue. If it’s in the shadows of a tree in the morning or the evening, it could be a gray/blue/red. If there’s a leafy tree nearby, it might be a gray/blue/red/green. But it’s white! There’s no debate about that. LOL.

          1. Steve H.

            “Brother Cavil: (Y)ou know how I perceived one of the most glorious events in the universe? With these ridiculous gelatinous orbs in my skull! With eyes designed to perceive only a tiny fraction of the EM spectrum. With ears designed only to hear vibrations in the air.

            Ellen Tigh: The five of us designed you to be as human as possible.

            Brother Cavil: I don’t want to be human! I want to see gamma rays! I want to hear X-rays! And I want to – I want to smell dark matter! Do you see the absurdity of what I am? I can’t even express these things properly because I have to – I have to conceptualize complex ideas in this stupid limiting spoken language!”

            1. Daníel

              Can’t tell you how cool it made me feel immediately recognising that quote…I miss Battlestar Galactica…truly a spark of greatness

              1. Steve H.

                May I encourage you to watch ‘Caprica’ then? Fully as extraordinary, if not so many explosions, but even more relevance for todays world (and the topic we’ve been discussing, as well).

                1. craazyboy

                  I thought Caprica got canceled after only a season or two. Or did I miss something?

                  But I do have all the Battlestar Galactica episodes sitting on my storage drive – and I’ll probably watch all of ’em again soon. That is one of the top series of all time in my book.

  2. rich

    The Passport King Christian Kalin’s business is showing poor countries they have at least one resource worth selling: citizenship

    Thanks to Kalin, St. Kitts has become the world’s most popular place to buy a passport, offering citizenship for $250,000 with no requirement that applicants ever set foot on the island’s sun-kissed shores. Buyers get visa-free travel to 132 countries, limited disclosure of financial information, and no taxes on income or capital gains.

    Henley is privately held and Kalin won’t discuss its revenue, but he says by the end of 2014, the firm had helped dozens of governments raise $4 billion in direct investment through citizenship or residency programs. It has also advised thousands of multimillionaires on where and how to buy a passport of convenience, collecting fees and commissions from all sides. Last year, at 42, Kalin became Henley’s chairman.

    The business Kalin pioneered has its share of critics, who say it gives the wealthy more room to avoid taxes and provides safe harbor to people who made their money illegally. “We’ve created over the past 50 years an entire shadow financial system that helps people hide money,” says Raymond Baker, president of the Washington-based advocacy group Global Financial Integrity. “This is a new wrinkle in that.”

    In June, Bloomberg News reported that Paul Bilzerian, a former Wall Street raider who served two prison terms for fraud, was claiming to be licensed to process citizenship applications for St. Kitts, where he now lives. Bilzerian helped an entrepreneur named Roger Ver—a provocateur widely known as Bitcoin Jesus—to purchase citizenship on the island. The two men then launched a website called Passports for Bitcoin to help people in places such as China use virtual currency to skirt local laws limiting money transfers. Learning of this, the St. Kitts citizenship unit made a hasty announcement that it wouldn’t be accepting bitcoins as payment. Bilzerian declined to comment for this story.

    “Like everywhere, in any industry, you have a spectrum of highly professional people all the way down to crooks and idiots,” Kalin says.

    Still, the passport business isn’t quite like any other. It presses moral buttons that most industries don’t. Is it right to turn citizenship into something that can be bought and sold? That’s still an open question for most people, and Kalin admits as much. “It’s sensitive,” he says.

    “If you haven’t noticed,” Chotrani says, “there’s no such thing as home loyalty anymore. You have to protect your assets. It’s the simplest economic logic.”

  3. wbgonne


    Not to keep you in suspense, I’m thumbs down. I don’t think the proposal is likely to be the terrible, worker-destroying pact some progressives assert, but it doesn’t look like a good thing either for the world or for the United States, and you have to wonder why the Obama administration, in particular, would consider devoting any political capital to getting this through.

    Actually, I was glad to see Larry Summers weigh in on the same subject in yesterday’s FT. Reading that piece, you may wonder what just happened – did Larry come out for the deal or against it? The answer, I think (slide 1), is that he basically supported an idealized TPP that could have been, but came out against the TPP that actually seems to be on the table. And that means that he and I are in a similar place.

    I am glad Krugman states his opposition to TPP. However, this tepid crtitique coupled with Yves’ astute observation that Krugman apparently has no problem ceding U.S. sovereignty to transnational corporations signifies that we are headed for Classic Krugman: pose some technical objections to what the Democratic president proposes, wait for the minor tweaking (real or imagined), tben declare himself satisfied and come out in support. I don’t trust that man because he is a partisan Democrat first and an economist second.

    1. wbgonne

      P.S., Re: the investor-state dispute settlement panels, I see the Obama propaganda line is that the U.S. has never lost one of those cases to date so there is nothing to worry about. It would be nice to see a full smackdown of that specious argument by someone with clout, knowledge, and a forum. Hint hint.

      1. Praedor

        The argument further tries to claim that the ISDS system is mainly used (and won) against states with fairly poor judicial/legal systems. How do they explain the Swiss nuke company using an ISDS to rape Germany because they had the audacity to decide to phase out nuclear power? I’m pretty sure that Germany’s judicial/legal system is world-class, even likely superior to the US (hard to be anything but less corrupt and co-opted than the US judicial system among developed nations). ISDS is simply a declaration that investors and corporations are entitled to profits NO MATTER WHAT. If those profits have to come from captive taxpayers then so be it.

        1. wbgonne

          Yes, I’m sure the U.S.’s track record in ISDS is an historic anomaly. To begin, past performance does not predict tbe future, especially when the ground is shifting in fundamental ways. Moreover, in its bipartisan servitude to transnational corporations, the American government is now more likely to undercut environmental protections, safety regulations and worker protections than it is to promote those goals. With the neoliberal evisceration of the American regulatory state, we are less likely to be the defendant is these lost-profit-by-national-regulation actions.

          Since we aren’t regulating any longer we won’t lose ISDS cases based on our regulations. Is that “winning”? And when Big Oil sues a nation for banning fracking the U.S. will undoubtedly side with the frackers, who will likely prevail. So “winning” isn’t necessarily winning at all.

      2. Gregory Corby

        Irish Environment dot com article, “The Trojan Horse: Investor State Dispute Settlement in the EU-US Proposed Trade Agreement (TTIP).” Friends of the Earth Europe analyzed 127 cases of ISDS claims under existing trade agreements, outcomes, implications under TTIP. Of 127 cases, 75 involved environmental sectors. Of 127 cases, 28 were successes for investors, 13 settlements, 14 favored the State, 18 unknown outcomes, 21 rejected/discontinued, and 46 cases still pending. Largest award for investors: 553 million pounds against Slovak; largest settlement by State, 2 billion pounds paid by Poland to a Dutch company. “Arbitrators will deliver what the corporations most want – more profits.”

    2. James Levy

      You have to wonder? Krugman has to wonder why Obama is pushing this? Is he stupid, or a liar? Or does Krugman simply believe we are all so stupid we can’t see what’s in front of us?

      He’s expending all this political capital and energy on the TPP and its Euro equivalent because, Dr. Krugman, his paymasters want it! You see, when people pay for your campaigns and your Library and dangle a wonderful 1% lifestyle for you, your wife, and your children after you retire from the Presidency at the age of 55 you tend to play ball with those people and watch out for their interests. Or is that too complicated for your Princeton mentality to grasp?

      1. fresno dan

        I agree. I would add Krugman is so indoctrinated with “free trade,” economics, GDP, to realize that even if it does in fact raise GDP higher than it would be otherwise (I don’t know if that is REALLY true or not, but assume for argument that it is) it certainly doesn’t follow that the benefits will be equally dispersed. IMHO, it is hard to look at the decades now of stagnant incomes and believe that trade is some unadulterated good.
        Of course, once you realize that the distribution is not some mathematical function, but raw political power, well…a lot of those fancy economic charts become gibberish….

    3. gordon

      I was struck by this remark at the end of Prof. Krugman’s post: “… in many cases it’s US corporations with the property rights. But are they really US firms in any meaningful sense? If pharma gets to charge more for drugs in developing countries, do the benefits flow back to US workers? Probably not so much”.

      This is potentially a bigger can of worms even than IP and ISDS, because it raises (again) the whole issue of what a multinational corporation really is, who it belongs to and who benefits from its successes. That in turn raises the question of what a National economy really is composed of in these days of “hyperglobalisation” (Prof. K’s word). What do phrases like “the economy will benefit” mean nowadays? Whose economy? What benefit?

      I wonder if Prof. K. intends to follow up on these implications.

      1. gordon

        I only just read this Dean Baker column on Prof. deLong’s views. Worth a look:

        “The basic point is straightforward. Increased money coming to Pfizer and Merck for patent fees and Microsoft and Disney for royalties will effectively crowd out net exports of manufacturing goods. Other things equal, the protectionist parts of the deal should make the dollar higher relative to other currencies. This will cause us to run larger deficits in manufacturing…”

        (Ack. to Economist’s View:

  4. frosty zoom

    so good to see Linh Dinh’s “postcard” series linked here. this material is well worth reading.

    All capitals strive to be showcases, sure, but very few, or perhaps none, is as successful at blocking out its nation’s true ugliness and failures. This sleight of hand, though, also works on many of the residents of this near perfect square inside a near perfect circle. The hell they’ve created keeps seeping in, however, and soon enough, it will overwhelm, if not explode, this Potemkin village of a city. This smug bubble will burst.

    you can find the photos that accompany the essay here:

  5. Praedor

    The IMF is wasting other people’s money (ours) in Ukraine. The Ukraine is one of the 50% of US-driven illegal coups that fail (to obtain the goals of the US Administration). The US sought a Western-linked Ukraine where neoliberalism would reign supreme with Monstanto and ConAgra owning the bulk of the rich farmland, the water privatized and in the hands of US corporations (Nestle?), and the oil/gas fields of the eastern Ukraine firmly in the looting hands of Exxon, Shell, etc. Nope. It is going to go Russia’s way: a federal system with two fairly independent states, the western portion firmly in the hands of neoliberal austerity and privatization hell, and the eastern portion, independent and aligned more with Russia than the EU. Too bad, so sad. No oil/gas for the US, no kicking out of Russian transportation rights to Crimea, no kicking Russia out of Crimea (wouldn’t happen regardless because Crimea is now, de facto, Russian again). US 0, Russia 1.

    IMF lo$e$ too.

    1. cwaltz

      Coming soon…….Venezuela or Ukraine part 2 If at first you don’t succeed figure out a reason to destabilize another country in the name of “national security” so you can steal it’s resources. It’s got the bonus of not being located next to Russia!

  6. MartyH

    On “Open Source Hardware” … so the industry has realized that there is no commercial advantage in board and chassis design and is commoditizing. Common business sense, of course. Pretty much the end of well funded innovation in that stuff.

    The misdirection is that it is all based on proprietary chips which is where the big money is anyway. It is amusing that they still have a licensing melange. So it’s a good idea but some still can’t really play on this “levelled field” without private holdbacks. <groans>

    This will save the big buyers some serious money as the manufacturers are forced to compete on a common standard (a guarantee of a price war to the bottom … may the most roboticized win!) We are sold Open Source on its merits of transparency and freedumb. The flip side is obvious here. This is commodification that concentrates profits into a smaller group of proprietary players (the chip vendors) and, by agreement among the likes of HP and friends, attacks the profitability of the others who differentiated on innovative board and packaging designs. We can expect the finished goods vendors (HP, etc.) to pass along a part of the savings and boost profitability … that’s predictable.

    1. hunkerdown

      Innovation being superficial, self-congratulatory novelty, good riddance to it, would that it were true. There’s plenty of poorly-funded invention, being useful and non-opinionated satisfaction of needs, just waiting to happen, and what exactly is the problem if people are using their creations instead of salesing them?

      Note that rasPi are working with US “innovators” Broadcom, whose arbitrary policy of NDAing and licensing everything makes chips essentially unavailable to medium-run businesses as well as garage hobbyists without very special dispensation (such as the non-profit RasPi organization has received), and are thus repaying their induction into the revealed wisdom of yet another ARM SoC permutation by scrupulous adherence to the patent trolls’ rules. And some chip foundries just don’t care enough, such as the Chinese firm Allwinner, whose SoCs can be found in many of those sub-$100 white-box tablets on eBay and who has been very freely working with the FOSS community.

      Big buyers aren’t saving all that much money because the rasPi or Arduino are keeping commercially underwhelming SoCs out of the glue factory and in some level of production. What you seem to be undervaluing or missing is that all this innovation you’re on about is nothing more than permutation, a la the stereotypical Chinese menu (two from column A, one from column B, etc.). You choose from thousands of standard part numbers (unless you’re big enough to get made-to-fit combinations from Qualcomm or have or can get semiconductor design capacity). You break out thus and such GPIO port, or you don’t. You put this amount of this standard of memory on the board, or some other amount of the same or other standard. You hook an HDMI connector to the HDMI out pins, or you hook an off-the-shelf composite down-converter chip, or you don’t, or you do both. And so on and so on.

      Also, for all this talk about innovation, the “reference design” or “sample application” has been around for longer than the semiconductor industry. Why do you hate the commons and why do you think you’re entitled to collect rent on it?

  7. vidimi

    Isis are not the only ones committing great acts of vandalism>

    But there are other motives at play as well, and some of them are not far removed from the ideas that animate Isis. That old missionary project, “conquering the darkness”, invoking both the biblical struggle between good and evil and the colonial imperative to demonise and destroy the resistance of dark-skinned peoples, enabling settlers to seize their land, their labour and their resources, still drives the destruction of precious wild places.


    In New Zealand until a few decades ago, people took their families into the countryside at weekends to ringbark trees, killing them for the good of the nation. They believed that they were doing the world a favour by destroying a dark and primitive wilderness. Cultural cleansing and ecological cleansing are driven by the same impulses, in some cases to serve the same ends.

  8. participant-observer-observed

    Finance news from Nepal (with a PWC-style joint venture up to an enterprising, patient, trekking-loving books guru):

    If You Give Peanuts, You Will Only Get Monkeys: NRB Governor

    Last Updated At: 2015-03-12 8:42 AM


    KATHMANDU: Nepal Rastra Bank (NRB) Governor Yubaraj Khatiwada today said international auditing companies should be allowed to conduct external audits of domestic banks and financial institutions (BFIs), indicating the quality of chartered accountants (CAs) here was not up to international standards.

    “It may cost many times more to hire international auditors … but if you give peanuts, you will only get monkeys,” the central bank governor told a conference on financial fraud organised here by National Banking Institute,

    referring to the adage, which roughly means one cannot expect quality service from low-paid employees.

    The quality of domestic CAs, who conduct external audits of BFIs, has often been questioned because NRB has detected holes in many balance sheets approved by domestic CAs.

    Take the case of Grand Bank, for instance. Its capital adequacy ratio, which stood at 12.43 per cent at the end of third quarter of last fiscal year, had slumped to 4.07 per cent by end of that year.

    At that time, many had expressed disbelief, as such rapid erosion in the ratio — which gauges a banking institution’s strength to absorb shocks and ability to extend loans — in such a short period of time was deemed impossible.

    Since the poor financial health of the bank was made public after entry of a new CEO in the bank, it was suspected that the previous chief executive had deliberately tried to hide the problem. It was also deemed that external auditors had colluded with the previous CEO to sweep the issue under the carpet.

    “It is true that our CAs lack skill. But because of legal barriers, we cannot hire foreign auditors to conduct audits,” Spokesperson at the Office of the Auditor General Babu Ram Gautam said.

    As per the Institute of Chartered Accountants of Nepal, the regulatory body for auditors, foreign auditors can only extend consultancy service here but cannot conduct audits of banks and financial institutions.“I have discussed this issue with the Auditor General,” Khatiwada said.

  9. Jim Haygood

    WSJ article:

    ‘Mrs. Clinton’s office added she was following the State Department guidance in delivering printed copies of her emails, rather than an electronic archive. Rep. Chaffetz said he would request the electronic version.’

    ‘YEAH, RIGHT.’ Crikey, it’s like reliving the Nineties, now that we’re getting a daily feed of vintage, smoke-blowing effrontery from the Clintons.

    The essential difference between electronic files and boxes full of paper is that the latter aren’t searchable. It takes a long time to run 55,000 pages through an OCR scanner, and the result is still not quite the same as the original file.

    If the State Dept. did give such patently absurd, counterproductive guidance to cripple the usefulness of her files, it’s because Clinton staffers issued it at Hillary’s direction. No competent, objective archivist would demand or accept piles of paper when a digital file is available. It’s ludicrous; it’s laughable. But the Clintons expect peeps to just believe their brazen, self-serving whoppers.

    Her server’s gone but it’s not forgotten
    This is the story of Hillary Rotten
    It’s better to wipe docs than to let snoops play
    My, my, hey heyyyyyyyyy

    1. Katniss Everdeen

      Dealing with the Clintons is like dealing with defiant teenagers. You make rules, trying to be as logical and specific as possible, and they’re off. Looking for any exploitable nuance or vagary, conjuring up tortured excuse after tortured excuse, and, when all else fails, whining about how “unfair” you’re being or that you’re just being “mean” and that they “hate” you.

      And so you spend all of your time and energy chasing after them trying to make sure that they stay on the straight and narrow, and trying to actually legitimize their irrational reasoning so you can convince yourself that they’re really “good” kids who are just “feeling they’re oats” on the way to well-adjusted “maturity.”

      But sometimes development is just plain arrested.

      After some three decades of indulgence, the Clintons are still refusing to put their dirty dishes in the dishwasher and have parked their wrinkled 60-year-old asses on the couch and are demanding someone go out and buy them their cigarettes and beer.

      Time to cut ’em loose. They’re way more trouble than they’re worth.

    2. Yves Smith Post author

      Oh, I’d pointed that out to Lambert. It was in the original stories on the e-mail scandal, that she’d delivered 55,000 pages of printouts. What fucking nonsense. And you can bet she did it on a low res setting to make the conversion back less reliable.

  10. Furzy Mouse

    Sugar, one of the most politicized of commodities, became one of the first trading rings, starting in 1914 at the CSCE, and even earlier in London. It was also the chief reason for the importation of slaves into the New World, as harvesting and refining sugar cane is quite labor intensive. Big sugar is woven into the business and political fabric of every producer and user of the sweetener to this day.

    “Colin Prescod, Chair of the Institute of Race Relations and advisor on the gallery (Museum in Docklands permanent gallery, London, Sugar & Slavery) said: “Over some three centuries, transatlantic slavery and the associated ‘triangle trade’ generated extraordinary profit, amassed unimaginable wealth, and spawned obscenely inhumane brutalities on a massive scale.”

    Sugar remains a political hot potato. After Reagan’s election, he provided succor to his supporters in the sugar producing States, LA, FL and HI, by establishing sugar import quotas for all countries exporting sugar to the USA. ( The world market for raw sugar then was around 5 cents a pound; after the quotas , US raw sugar (now #16 futures) jumped to 25 to 30 cents per pound, where it remains. (May world sugar #11 last trading around 13.50 cents per pound). This of course hurt many of our Caribbean trading partners, who relied on sugar as a cash export to the US.

    “One aspect of the global sugar trade that has remained constant since colonial days is the widespread subsidization of growers,import restrictions and trade blocs. Part of the reason for the longterm downward pressure on real sugar prices has been production subsidies and import protections, whether they’re American tariffs, European beet subsidies or other factors. The U.S. domestic sugar price represented by the ICE Sugar No. 16 contract often trades 35-50% over the Sugar No. 11 price [both raw cane sugars]. This price disparity, which has been close to 3:1 in the past, has had a profound effect on U.S confectioners, bakers and soft drink manufacturers, many of whom have either left the business or switched to high fructose corn
    syrup as a sweetener. U.S. trade agreements for sugar include The Caribbean Basin Initiative, the African Growth and Opportunity Act and the North American Free Trade Agreement…..

    Sugar cane is by far the most efficient converter of solar energy into useable plant carbohydrates, at about 8% versus just over 1% for corn. This efficiency derives from a biochemical quirk involving the photosynthetic arrangement of four carbon atoms (instead of three), and allows the sugar cane to pull vast quantities of carbon dioxide out of the air. The ability of the sugar cane plant to capture so much of the sun’s energy makes it the most efficient feedstock for ethanol distillation.”

    (Shameless plug for sugar; certainly better than fructose and ethanol from corn!!)

    1. Robert Dudek

      Sugar is half fructose. On a volume basis, it is the most damaging substance consumed by human beings of all time.

  11. financial matters

    I thought this was an interesting article on blood transfusions and best practices in medicine.

    ‘The Next Chapter in Patient Blood Management: Real-Time Clinical Decision Support’ Goodnough and Shah, Stanford University Hospital and Clinics

    They point out that 30% of our very large health care expenditures are estimated to be wasteful. (this amounts to about a trillion dollars) (and this by the way doesn’t include private insurance overhead). This needs to be addressed hand in hand with evolving into a modern era of single payer health care.

    Blood transfusion was targeted as one of the 5 key overuse measures and so hospitals are trying to address this. This has been a recognized problem for a long time and gained increased importance when patients became infected with HIV by blood transfusions. It’s a hard thing to monitor because it not only deals with how anemic the patient is but also his/her clinical condition.

    Interestingly the electronic medical record can offer a real time ‘best practices alert’ by coordinating these factors when a physician places a blood transfusion order. They had an overall 24% reduction in transfusion as well as better patient outcomes.

    These measures have to be used wisely but could also be helpful in other laboratory testing, radiology and therapy such as antibiotics.

    Medicine is an art as well as a science and there of course has to be room for special cases which are included in these algorithms. They still had 30% of cases not meeting criteria. These are good cases for quality assurance review. It’s good to know if these are appropriate and the standards need to change or if this is just bad practice.

    1. cwaltz

      The electronic medical record system that presently doesn’t exist? My physician had to email my medical results from the hospital to my ortho doctor because the two hospital systems don’t “communicate.” There is literally no way for HCA to know what Carilion has done or Carilion to know what HCA has done without the patient relaying it to the doctor. Even though I am feeling under the weather I’ve had to essentially carry a truncated version of my medical testing and care back and forth because my specialist is in a separate network from my primary care doctor.

      After almost 2 months(and hundreds of dollars in co pays with hundreds of dollars in deductibles coming) I can honestly say I think rather than saying “we have the best medical care” that I feel more comfortable saying that “your medical care is a crap shoot. Next up, a GI doctor to see how long I can expect my GI tract to be screwed up from being on antibiotics for a month. Never let it be said I don’t learn from my mistakes though, I’ll be using the same network as my primary care doctor( who gets the dubious honor of deciding what to do with the fact that my B/P has shot through the roof thanks to my hand.)

      1. hunkerdown

        Don’t blame the tool (or lack thereof) for the commercial advantages derived from “innovation” (gratuitous dissonance) over network effects. For an example of what medical IT could be, see OSCAR: a tool, not a club (in either sense).

        Also, not medical advice, but probiotics after an antibiotic regimen helped restore my gut to working order post-sulfa.

        1. cwaltz

          Thanks for the advice on the probiotics I’ve been on them since my second antibiotic though(an ER doc recommended them.) I’m presently on a bland diet and am mainly focusing on fruits and veggies to try and restore some semblance of order(and it hopefully will have the bonus of helping with the B/P.

  12. Jim Haygood

    WASHINGTON (MarketWatch) – The International Monetary Fund is so far not concerned about the euro’s weakness. In a briefing for reporters, IMF spokesman Gerry Rice said that recent moves in the European currency were “in line with fundamentals.”

    That’s like Jeffrey Dahmer saying he’s ‘not concerned about cannibalism.’ Always and everywhere, the IMF’s recipe for troubled borrowers has been devaluation.

    Except for Greece. There, the prerogatives of the EU (which groomed the IMF’s leadership) supersede what’s best for the borrower. But euro devaluation does provide some incremental help for Greece, at least in relation to its non-eurozone trade.

  13. vidimi

    re: Wall St. banks launch massive buybacks, boost dividends

    in unrelated news, wall street prepares for record bonuses

    guess they want to cash in before the stock jenga comes crashing down.

  14. Jagger

    “Leak investigation stalls amid fears of confirming U.S.-Israel operation,” Washington Post

    So has Israel finally jumped the shark? Reading a few pages of comment in the WP, Israel is called out over and over. You wouldn’t have seen that on the WP 10 years ago…probably not even two years ago. So when will Israel jump the shark with the powers that be?

  15. annie

    walsh’s ideas on intelligence in economists reminded me of Kurt Hammerstein’s theories on intelligence in generals (do read Hans Magnus Enzensberger’s marvelous ‘The Silences of Hammerstein’). Hammerstein, top general in the german army between the wars, divided army personnel into combinations of four categories: smart, stupid, diligent, lazy:
    the smart and diligent make up the best staff underlings; stupid and lazy make up the grunts; smart but lazy gives you the best general (they who are free to think deeply); those stupid but diligent are the most dangerous.

    seems in summers’ case it is the diligence–more precisely, ambition–that clouds the intelligence, making him suspect, if not to say dangerous. de long, as walsh says, has no judgment (e.g., previous worship of greenspan), which in my mind makes him not intelligent at all.

  16. MyLessThanPrimeBeef

    Capital controls in emerging economies.

    It’s also a problem between a huge country and a small country. I can’t imagine what damage a lot of money rushing in and rushing out of a small country, Monaco, for example, who is not an emerging economy, I think, from another one, say, 50 times or more its size, China perhaps, will do.

    Maybe not in the 1950’s. But today, China has a lot of US dollars to do a lot of rushing in and out.

  17. MyLessThanPrimeBeef

    Foreign real estate buyers…money laundering risk.

    Another reason for foreign real estate buying in, say Southern California, is, I believe, the need for maternity motel rooms.

    With the reported fees they charge for those would-be mothers of future Americans, they can afford all-cash deals, not just for apartments, but also for single family homes (not raided in the last Fed sweep, I think)….here, Greed dictates they put 10 or more pregnant women in a, say, 4 bedroom house….you make more money that way. I don’t know if that’s what they are doing, but a ‘smart’ operator would do that.

    As a bonus, I believe some were, a few years ago, pushing for giving out green cards for real estate buyers; thus, these operators can get permanent residency for themselves as well.

  18. craazyman

    The earth drifting into a chilly part of the galaxy seems plausible to me. I wonder how they measure temperature in outer space. I don’t think they directly measure it, with thermometers, so they must model it somehow. Maybe it decreases with the square of the distance from the sun and other stars. Then they do a cluster analysis of star density within radii of increasing parsecs in magnitude modulated by star type and size, which would be related to heat output. Then they interpolate the modeled findings into a termperature-space that bears a 1-1 relationship with some conception of spatial geometry, sort of a 3D map of galactic volume. That would do it. That must mean the earth floated into a region of space with a low star cluster density reading.

    It occurred to me this might be related to Bruce Jenner’s sex change operation. Anybody could be wandering around and collide with a disembodied spirit who takes over their mind. If the spirit is a female spirit, it could explain why somebody would want a sex change. Just wandering around, that’s kind of scary. God knows what you’ll run into and you won’t even know it. I wonder if that’s what happens. We might usefully invent a disembodied spirit detector, just so you know what to watch out for.

    1. craazyboy

      With disembodied female spirits walking around, I sure wouldn’t wear $1000 shoes. You’d be a goner in no time. Next thing you know, sex change operation. I bet that was what happened to Bruce Jenner. All that commercial and sponsor money started rolling in and he stopped wearing Adidas and bought the $1000 shoes. Maybe a lot of them. That’s asking for trouble.

      Same probably goes for expensive designer clothing. I think I’m safe with that ’cause I shop at Ross after they whack the price 75% – women aren’t interested anymore if it is cheap clothing.

      Spirit detectors don’t work – even American made ones. The ones you see one TV are fake. That’s all trick photography. The only chance of detecting one is to ask an economist, but then he’ll just narrow it down to an entire industry. Not much help.

      The best way to stay safe is avoid expensive shoes. Or you may find yourself wearing silk panties from China.

      1. craazyman

        you don’t really hear about a lot of women getting sex change operations, usually it’s the guys. it must be like getting your hair cut, it’s easier to cut it than glue it back where it never was. holy smokes, I don’t know if they could make a woman into a man but whoa, if you’re a straight guy and somebody told you you had to fukkk a guy up the ass you’d probly rather do a guy that used to be a woman than a regular dude with a hairy chest, and a bald spot and pimples on his butt with his fat gut hanging down like ttits. holy fukkk just thinkign about that makes me want to vomit. how do women lay in the same bed with a dude like that, or any guy actually? it sounds horrible. If the guy used to be a hot woman you could at least think “there’s still a woman in there somewhere” and just get it over with, if you really had to. wow. it makes you really want to be careful, you know, just walking around. you never know what you’ll run into

        1. craazyboy

          With disembodied female spirits walking around, I sure wouldn’t wear $1000 shoes. You’d be a goner in no time. Next thing you know, sex change operation. I bet that was what happened to Bruce Jenner. All that commercial and sponsor money started rolling in and he stopped wearing Adidas and bought the $1000 shoes. Maybe a lot of them. That’s asking for trouble.

          Same probably goes for expensive designer clothing. I think I’m safe with that ’cause I shop at Ross after they whack the price 75% – women aren’t interested anymore if it is cheap clothing.

          Spirit detectors don’t work – even American made ones. The ones you see one TV are fake. That’s all trick photography. The only chance of detecting one is to ask an economist, but then he’ll just narrow it down to an entire industry. Not much help.

          The best way to stay safe is avoid expensive shoes. Or you may find yourself wearing silk panties from China.

        2. craazyboy

          Women get hair extensions, but they are in for a big surprise if they think it’s gonna be that easy.

          Those are some scary thoughts, craazyman. I like keeping things simple and that way I don’t scare myself that often. If a guy looks like a hottie, it’s a no go. If a women looks like a big fat hairy guy, it’s a no go. Probably just me, but I like it that way.

        3. Demeter

          The transgender movement (male to female sex changes) is for the guy who is so down on feminists that he figures he can get it all (power, glory, sex) by changing to a woman.

          As a woman, I cannot even pretend to believe that a biological male is doing anything more than pretending to be some stereotypical, comic-strip female.

          Has this newly-made female bled? NO.
          Experienced a pregnancy scare? NO
          Given birth? NO
          Endured cramps, body image issues, intelligence discrimination (regardless of actual IQ or other intrinsic talents)? NO
          Been infantilized by sexual stereotyping? That can happen to both sexes, but in different ways. Entitlement results in either case.
          Developed PSTD from the culture which seeks to “preserve” feminine virtue through restriction, terror and violence? Not likely.
          Been terrorized by a whacked out male? Well, possibly.

          To be female in this culture is to be warped to the cultural woof, just as to be male is to be bent to stereotype. A woman who escapes the cultural stereotype is ignored, makes her way, and usually survives. The culture tolerates the atypical female for the exploitation value. Also, women develop protective strategies, learn to avoid drawing attention they don’t want, etc.

          A male who escapes the culture…well, there are a lot of Lost Boys. They usually don’t fare as well or live as long as those males who can integrate into a culture that favors them (or did, until recently).

          There are women who have changed to men, and benefited from the male cultural privileges. While I envy them that male privilege, I can honestly say that I’d not make it as a man. At my age, it’s immaterial, anyway. Still, it would be nice to be paid what I’m worth, have the freedom to propose marriage or whatever to any potential partner that catches my fancy, etc, etc.

  19. direction

    LOL I just got to the airport and opened NC links to find the same gator article my taxi driver just showed me! (the gator was sighted close to where he picked me up). NC seems to continue jibing well with my life. Hello from Florida!

  20. Kim Kaufman

    “The Dangers of Intelligence without Creativity or Judgment Ian Welsh. One minor quibble re Larry Summers: even though he is famed for his intelligence, having seen him in action, his reputation rests at least in part on his debating skills (and being a highly dominant personality). Despite economics’ fetishization of mathematics, it also prizes argumentation (without, as debaters would, giving demerits for tricks like straw manning and ad hominems, which Summers uses routinely).”

    You mean Larry Summers is a bully??

  21. Chauncey Gardiner

    Thank you for the link to the article from the Telegraph by Ambrose Evans-Pritchard. It is a modest relief to see that U.S.-border banks, shadow banks and bond investors hold a relatively small portion of the total $US 9 trillion debt to offshore debtors. Nonetheless, I suspect large U.S. banks have second and third derivative exposures to losses due to the interconnectedness of the global financial system and the activities of their offshore subsidiaries. Further, the BIS working paper to which Ambrose linked does not address the net risk exposures of large global banks (SIFIs) who have engaged in speculative currency, energy and commodity contracts and trades, so that remains unclear.

    Hard to say what the Fed’s share of responsibility is in this, either in the past or going forward. IMO the PBC, BoJ, and ECB share significant policy responsibility, as well as various other nations’ central banks and governments where the debtors are domiciled.

    Wonder when the BIS will open those bi-monthly meetings in Basel up to the hoi polloi?

    For some reason, this all reminds me of the music video “Amerika” by the German heavy metal group Rammstein.

  22. Randy Given

    Can the list of articles be trimmed some? I’m a long-time reader and fan, but I’m getting overwhelmed, now. And now there’s a mid-day (Water Cooler) as well. There’s a lot of good stuff, but too much for me. As a result, I end up skimming, and skipping, many articles. Part of what drew me to NC was the limited selection of quality articles to read.

  23. ewmayer

    Re. Los Altos Hills cellphone tracking: Since most of the richies living in LAH made their money in (or in some way from) Big Tech, I say, serves ’em right to now be equal-opportunity victims of the Digital Panopticon they helped unleash on the rest of us.

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