Links 7/18/15

Let’s Get Real About Gold: It’s a Pet Rock Wall Street Journal. Or trading sardines.

How a physics discovery 85 years in the making could change how we build electronics TechRepublic

International report confirms: 2014 was Earth’s warmest year on record NOAA

Google To Provide Free Internet For Public Housing Residents To All Fiber Markets Slashdot (furzy mouse). Beware of Google bearing gifts….

Craving machine companionship? Japan’s robot hotel is for you ITworld (Chuck L)

How the West Overcounts Its Water Supplies New York Times. We’ve been warning for some time that potable water is the natural resource that is due to be in scarce supply first….

No bones about it: Cannabis may be used to treat fractures: Tel Aviv University researcher finds non-psychotropic compound in marijuana can help heal bone fissures ScienceDaily (Chuck L)

Japan Scraps Olympic Stadium Plan Over $2 Billion Price Tag New York Times (EM)

AIIB membership has costs and privileges Bankgkok Post (furzy mouse)

Why Argentina Consistently, and Unapologetically, Refuses to Pay Its Debts Bloomberg (furzy mouse)


German lawmakers back Greek bailout despite rebellion; Tsipras sacks dissenters Reuters (furzy mouse)

Alexis Tsipras Clinging to Power as Syriza Rebellion Gathers Pace Wall Street Journal (Sid S)

Greece debt crisis: Watch angry Golden Dawn MP rip up bailout deal during heated debate Independent (Sid S)

The Real Plan B: The New Greek Marathon Sam Gindin and Leo Panitch, The Bullet (Sid S)

Here’s What Membership in the Euro Did for Greece Bloomberg (reslic)

Germany Risks Its Reputation With Idea of Greece Exiting Eurozone New York Times

Greece, Europe, and the United States James Galbraith, Harper’s

This Is How Quickly Greece’s Future Is Deteriorating Bloomberg

Reflection related to European policy ” Google Translate version. Original here (guurst). Important. Note the date.


Obama’s Nuclear Deal With Iran: Rare Victory for Peace or Foolish Compromise? Michael Shedlock

ISIS Has Fired Chemical Mortar Shells, Evidence Indicates New York Times

Ignatius’ Bad Advice on Iran American Conservative. Resilc: “If there is a government in the region that needs to be presented with a “sharp choice” regarding its destabilizing foreign policy, it is the one based in Riyadh. It isn’t Iran that continues trying to bomb Yemen into submission while starving its civilian population. If the U.S. is concerned about destabilizing behavior, it ought to look to its own clients first.”

Big Brother is Watching You Watch

A drone firing a gun: so this is what all the regulation is about The Stack (furzy mouse)

Elizabeth Warren Challenges Hillary Clinton to End the Revolving Door New Republic (resilc)

As Trump Surges in the Polls, Hispanic Voters Flock to Hillary Clinton Yahoo (furzy mouse). Note this poll was Trump v. Clinton. No polling here of Clinton v. Sanders. Since the poll was by Fox, it looks like part of Republican hair-tearing over Trump’s ascendency.

Residents Sue Seattle, Saying New Trash Rules Violate Privacy New York Times

Strong dollar, sluggish growth weighs against Fed raising interest rates Yahoo (furzy mouse)

Federal Employees: Can’t Hire the Best, Can’t Fire the Worst Fiscal Times (furzy mouse). If you read the actual report, I doubt it is any different in the private sector, save at a few high-paying employers, but they can churn workers (as in fire ones they are not happy with, only to replace them with ones they are only somewhat less happy with).

JPMorgan reaches $388 million settlement in mortgage securities case Reuters

Five years later, Dodd-Frank naysayers are still wrong Fortune

Goldman’s Blankfein joins the 3-comma club Yahoo

No Growth, No profit, No problem Wolf Richter

Class Warfare

Workers Rising: Homejoy’s Collapse Is the Latest Crack In the Sharing Economy Motherboard (resilc)

You’re Richer Than You Think. Really. Fiscal Times

Coal Miners Struggle to Survive in an Industry Battered by Layoffs and Bankruptcy New York Times

Wells Fargo wins dismissal of predatory lending lawsuits Reuters

It’s not just Fox News: How liberal apologists torpedoed change, helped make the Democrats safe for Wall Street Salon (Mark H). Circulate widely. Finally (later than we’d like, but later is better than never) Frank calls out the Vichy Left.

Stowaways and Crimes Aboard a Scofflaw Ship New York Times. Today’s must read.

Antidote du jour (Guardian, courtesy resllc):

another pretty caterpilllar links

See yesterday’s Links and Antidote du Jour here.

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  1. allan

    A chaser to David Dayen’s “Elizabeth Warren Challenges Hillary Clinton to End the Revolving Door” is his tweet from Netroots Nation 2015 last night:

    Hillary Clinton has zero presence at #nn15. Last year Ready for Hillary put on a very large party. This year nothing.

    She, and her people, couldn’t care less what the hippies think.

    1. Lambert Strether

      I think identifying Netroots Nation with hippies is not quite right. See here and here. I think your more general point, that the Clinton campaign is being extrarordinarily careful about how they expose their candidate, is correct.

  2. Vatch

    “Elizabeth Warren Challenges Hillary Clinton to End the Revolving Door New Republic (resilc)”

    Hah! Does that mean we wouldn’t be able to have “quality” government officials such as Eric Holder and Mary Jo White?

    1. JTMcPhee

      Or at least ” experts” like Geithner and Paulson and Rumsfeld and Panetta and Gates… Experts in WHAT, again? Good luck changing the system, of course…

    1. optimader

      The notion of a “private island” is more exotic than the reality.
      The reality is that the buyer becomes a local employer, consumer and taxpayer. A normal person can stand about two weeks on a “private island” unless maybe you have agoraphobic -antisocial tendencies.

      This is sensational but the fact is, practically speaking it is probably some of the most overvalued property in Greece. Good luck to them peddling it off to the likes of johnny depp and brad pitt.

  3. Disturbed Voter

    Of course WSJ would be opposed to any investments other than stocks and bonds. They always talk their book.

    Precious metals in particular, rely just as much on irrational human behavior as stock and bonds … and are primarily useful as long term insurance against nasty historical events. Not at all a reason why people invest in stocks and bonds … which are very short term speculation which ignores any possibility that tomorrow may be different than today.

    1. Jim Haygood

      If owning gold is an ‘act of faith,’ what is holding fiat currencies, nearly all of which have shed at least 95% of their value over the past century? It’s something like leaping off a tall building with cardboard wings whilst out of your mind on bath salts.

      When journo-hos start sniping at poorly-performing asset classes (gold is down almost 40% since August 2011, after delivering a seven-bagger over the previous decade), start looking for a bottom. After all, the MSM is infallibly wrong.

      1. lulu

        While cleaning out my grandfather’s house, I found a twenty dollar gold piece and a twenty dollar bill in an old jacket pocket… the old bill had a certain slight numismatic value, and the coin did too, but guess which one I was really excited to find.

      2. MyLessThanPrimeBeef

        Beautify our world.

        Please do not just throw away gold that you think is worthless*. Please bring it to your local little-to-no-value precious metals collection centers, so they can be disposed off properly (i.e. sold to China).

        *Worth or value is a relative thing. A tube of lipstick is of zero value to me, but if someone is willing to pay a certain amount for it, I have no problem assigning a monetary value to it accordingly.

        1. Jim Haygood

          Actually there was a ‘partial fiat’ period from 1933 to 1971, when foreign central banks could redeem their dollars for gold, but US citizens couldn’t.

          The fateful moment when paper reserves (i.e., US Treasury securities) exceeded the value of gold reserves occurred in 1944, as shown in this chart:

          By no coincidence, inflation rocketed higher in the late 1940s, and never looked back.

      3. Jack

        A smart investment, especially since US Treasury Securities are the most reliable thing on the planet. If you love gold so much, by all means, stockpile it. Just don’t come whining to me when, after civilization collapses, no one in the wasteland is impressed by your backpack full of heavy gold, while the other guy with the backpack full of canned food has real bargaining power.

        1. A Farmer

          Unfortunately, the third guy with the backpack full of guns and ammo might rule them both.

        2. optimader

          Just don’t come whining to me when, after civilization collapses
          How will I find you after civilization collapses, do you maybe have a Linkedin account?

        3. JCC

          Probably true, but I can also guarantee you that of two people, one with a backpack of US Dollars and the other with a backpack of gold, the one with the heavier of the two packs will stand a far better chance of bargaining a trade for one of those cans than the other.

          1. Jack

            You’re assuming that gold has some kind of intrinsic worth that a bunch of colored paper doesn’t. The worth of the US dollar is ultimately dependent on people accepting it has worth, and it is accepted because people need it to pay their taxes. If civilization reaches a point of collapse where that system of taxation breaks down, why do you assume people will still accept some heavy, soft metal? Gold is objectively one of the most useless things you can dig out of the earth. You can’t make tools or weapons out of it; it’s far too heavy while also being far too soft. The person with the practical goods, like food, will be much better off than the person who decided to hoard gold or silver in preparation for the collapse (and yes, the guy with the gun will be even more well off than the other two).

            “Investing in intangibles: gold, silver, diamonds, antiques,
            paintings, etc. are dependent for their value on desire, not need.
            When need is the uppermost consideration, desire is simply a
            frivolous emotion. In order to exchange your intangibles for your
            needs you will have to wait until surpluses are built up. In the
            meantime, say you approach a farmer and offer him a $600 Krugerrand
            for its value in chickens. If you’re lucky he may offer you a $600
            chicken.” – Kurt Saxon, How Not to Survive

            In the Fallout franchise of post-apocalyptic video games, bottle caps have become the defacto currency of the wasteland. It’s played as a joke, but it’s at least as reasonable a form of currency as pretty much anything else. And unlike gold, which people can still get more of if they feel like digging, bottle caps are in finite supply, since the means of making more has apparently become an art lost when the mushroom clouds filled the skies.

      4. Disturbed Voter

        Dante’s post is worth reading (at bottom). To put more meat to this … the point of gold and silver manipulation is to keep the 1% on the reservation … since their asset choices effect sovereign policy. Bill Gates has enough assets that he could have cornered the gold or silver markets if he chose to. Once upon a time, there were other currencies … gold certificates and silver certificates. But no more. GLD and SLV and similar ETFs are the current version of those obsolete currencies, but they are privately controlled and issued. So really, gold certificates and silver certificates have been privatized, first in 1933, and later in 1965. This was an early example of what is happening with Greece and the proposed sale of state assets. Once upon a time, government got the seigniorage, but now plutocrats do. And the gold and silver certificate market was moved from “the little people” to the “people who matter” … the market is upscale. Of course GLD and SLV are scams just like their prior government versions. There are far more issues of GLD and SLV than corresponding metal. And the point of control has moved … once upon a time London and NY, were the centers of both real and paper precious metals trading and holding. But the holding and trading of real precious metals has been moved to China and India … the trading of GLD and SLV has remained in the West. At some point, this binary cooperation will break down, with the West holding only non-redeemable paper assets, and all the real assets held by the East. This is the larger and longer term plan … controlled demolition of the West in favor of the East … with vultures like Bain Capital buying up the West, as agents of the East … for a few kopeks commission. By holding physical, you are democratizing the profit that will occur with the destruction of the West.

    2. jgordon

      The value of gold lies in the same vagaries of the human psych where we place value on attractive mates. The logic doesn’t matter, even if you have fancy monetary theories that prove your logic. People place value on rare things for the same reason that most men and women place value on a trim waistline. It’s instinct and not amenable to logic. I think that’s where most people who come up with these ideas about rational economics have seriously screwed the pooch.

      1. Jack

        Except that gold has not been treated as valuable universally. There actually has been a lot of real-world research done on this. The historical and anthropological evidence is very clear: money is, and always has been, a token to measure credit and debt. When the Spanish invaded the Americas they found an entire continent filled with people who didn’t care the slightest about gold other than as an amusing shiny thing to use as decoration. When the Lydians issued the first government coinage to pay their soldiers it was given value and made desirable because it was accepted as payment for taxes, not because of what it was made of.

        1. jgordon

          That misses the point that people attach value to things for almost everything–but–rational reasons. This is why economics and monetary theories are basically all just elaborate scams, which have often fooled even the espousers of such into believing.

          Yes, good point that monetary systems only came into existence with the advent of large-scale organized violence, as was demonstrated by David Graeber’s research. The true heart of all monetary systems is violence and coercion, and that should not be glossed over anywhere lest we mispercieve what we are dealing with.

          1. susan the other

            The value of “money” is based on… money. Seems a little circular to me. Whether it is gold, or a “strong” currency, or digits, money has a value which is disassociated from reality but nobody seems to care.

          2. Jack

            I don’t see fiat money/MMT as a scam at all. Not more than any other artificial token at any rate. If money is fundamentally a fiction created to ease or enable transactions and measure credit, then modern money is a return to an older, more natural form of currency.

            If we go about basing our money on finite, real objects we get absurd notions that we can’t do something because we ‘don’t have the money for it’. Do we have the resources to fix and modernize the entire infrastructure of the United States? Do we have the experts to plan it all out? Do we have a lot of people sitting around with nothing else to do who could perform all of the actual work? If the answer to these qustions is ‘yes’, which it is, then what is the supposed limitation? Oh, that we don’t have the $3 trillion needed? So print the needed money, problem solved.

    3. SubjectivObject

      As information, Dante’s comment far below provides an accurate description of the current [superficial, i.e.: what can be seen at the surface] commodity market context for paper and physical gold.

      As a corollary to the gold market, consider too the current market for commodity silver. At present, the outstanding paper commitments [unbacked by physical metal] for silver are about 30% of annual world production. This gives lie to any implication that these futures markets primarily intend to hedge producer production.

      While the perceived value of PM may be philosophized as … subjective, rather than as intrinsic, as say drinkable water, the amount of capital applied to control its price belies the practical reality that the effect of PM valuation was/is/continues to be of significant interest for central banks. As an aside, some commentators have suggested a role for PM going forward as a backing for letters of credit for trade, as/when inter-national trust in fiat wanes, and the London/NY markets no longer set/fix the value of PM for the rest of the world.

      1. Uahsenaa

        Since I began that negative stream of consciousness, I’ll explain myself in less general terms, though the failure to account for how economic and IT infrastructure actually work is still, to my mind, pretty damning and grounds to disregard most of what Mason says.

        His seemingly anti-capitalist argument, though it cloaks itself in Marx, is anything but. It, in fact, gives cover for corporations by veiling how the so-called knowledge economy is simply another example of precisely what Marx was talking about in Capital. At no point, does it occur to him that the sharing economy and its organs, businesses like Uber or Airbnb or Taskrabbit or what have you, are perfect examples of the extraction of surplus value or what in non-Marxian terms are referred to as rents. These businesses perform no labor themselves, with regards to the “services” they provide, but rather own the means of production, the IT infrastructure that facilitates dispatch, and through that ownership take a cut of what people pay for services rendered. It’s not a cooperative, just like workers in England didn’t own the textile mills, auto workers don’t own the assembly plant, and “rabbits,” as their called, don’t own the interface or telecommunications network with which customers solicit tasks to be performed. However, somehow Mason speaks of IT infrastructure as if it were simply there, like pasture lands before they were enclosed, yet it’s far more like the factories. We would never speak of a textile mill as simply there for use, yet many people do precisely that when it comes to “tech.” This is so absurd as to boggle the mind.

        This doesn’t even begin to address how these businesses openly flaunt local ordinances and regulations that their natural competitors are forced to live by, nor how they exert downward pressure on their “contractors” by forcing them to assume most of the risk, while making it ever increasingly difficult to eek out an existence without putting even more time than your average day laborer would working in a field or in some other yet-to-be-colonized service industry.

    1. flora

      It is an interesting article. I have two main disagreements with him

      He talks about neoliberal capitalism and implies that ending that form of capitalism is the same as the end of capitalism. There are other forms of capitalism besides neoliberalism, or laissez-faire. I think his implication that ending neoliberalism equals ending capitalism is too broad. There also seems to be the assumption, though I may be wrong, that his readers who are anti-neoliberal are also anti-capitalist, instead of anti-neoliberal.

      He talks about the rise of computer technology leading to a fundamental shift in power relations along the lines of ‘a new means of production’. Que Historical Materialism. He then recites ‘sharing economy’ and individual creativity to eke out a living in our neo-liberal present as evidence of historical change. The problem I have with this argument is that technology by itself amplifies power differences, it does not reduce them. He talks about the knowledge economy but rather glosses over the facts that it is a market economy. Think of Google capturing search data and selling it on to marketers, etc.

      His article is very interesting but I wish he had a better grasp of computer technology and was clearer in his definition of terms.

      1. flora

        I suppose what I really find objectionable in his essay, which is good as far as it goes, is its underlying current of “inevitability”. His argument’s essential passivity – the lack of human agency, the ‘neoliberalism will fall of its own weight’ line – is to me it’s primary flaw. I’m glad he’s attacking neoliberalism. I wish he would do so directly instead of hoping for a computer deus ex machina.

  4. lylo

    You’re Richer Than You Think. Really. Fiscal Times

    Desperate. You can tell the status quo isn’t holding when the MSM has to print stuff like this. Somehow I suspect that there are price disparities not accounted for (like skyrocketing rent here in the US that no one has a choice but to pay vs our cheap appliances that many don’t want anyway) more than make up for a lot of the ‘prosperity’ we see in those figures. I’ve noticed in my travels abroad it’s pretty easy to get by on a few dollars a day when a whole chicken is a dollar, which you will never see in this country.
    Also, doesn’t make sense that only 7% of Americans make what my family does, because 21% of the country is at the poverty line (Census Bureau last year)… Which is about $100 less than what we make a year.
    It also takes NO account for debt or assets. The average American has a lot of assets and makes decent money (as long as you don’t count mandatory health insurance purchase, no public transportation, regressive taxation, food deserts resulting in price gouging, etc.) but they take the cake with debt per household. Doesn’t debt cost money to pay back?

    All that said, now I know that my husband and I live on $15 a day. The rent in my area is about $800 a month minimum for a scary neighborhood tiny efficiency. That would be $26 a day. So to rent a crap apartment in my area, I would need as good of a job as my husband (he’s got tech certs and makes decent money for our area) and we would have $4 a day to eat. (No, MSM, I hadn’t done the math, as I luckily own my home. But THANK YOU for going through the trouble; now I can use it to mock this kind of article.)

    I’m sorry for the rant. People’s lack of understanding of currency really agitates me. A $ isn’t a $, even in this country, even within one state!
    If you honestly think that Americans are still rich globally, I have a lovely bridge in Hong Kong to sell you.

  5. Skippy

    Washington Consensus

    This is the set of 10 policies that the US government and the international financial institutions based in the US capital believed were necessary elements of “first stage policy reform” that all countries should adopt to increase economic growth. At its heart is an emphasis on the importance of macroeconomic stability and integration into the international economy – in other words a neo-liberal view of globalization. The framework included:

    Fiscal discipline – strict criteria for limiting budget deficits
    Public expenditure priorities – moving them away from subsidies and administration towards previously neglected fields with high economic returns
    Tax reform – broadening the tax base and cutting marginal tax rates
    Financial liberalization – interest rates should ideally be market-determined
    Exchange rates – should be managed to induce rapid growth in non-traditional exports
    Trade liberalization
    Increasing foreign direct investment (FDI) – by reducing barriers
    Privatization – state enterprises should be privatized
    Deregulation – abolition of regulations that impede the entry of new firms or restrict competition (except in the areas of safety, environment and finance)
    Secure intellectual property rights (IPR) – without excessive costs and available to the informal sector
    Reduced role for the state.

    These ideas proved very controversial, both inside and outside the Bretton Woods Institutions. However, they were implemented through conditionality under International Monetary Fund (IMF) and World Bank guidance. They are now being replaced by a post-Washington consensus.

    See also:

    Poverty Reduction Strategy Paper (PRSP)
    Structural Adjustment Programmes (SAPs)

  6. diptherio

    Re: Wells Fargo wins dismissal in predatory lending case

    No, that doesn’t mean they didn’t violate the law, it just means that the judges and/or prosecutors are incompetent or corrupt (imo). Or they are just stupid and can’t see past the letter of the law to the spirit of it. Call me cynical, but I think everyone involved in these cases is really on the same side–that of not rocking the boat. From the article:

    In the Los Angeles case, the city accused Wells Fargo of discriminatory lending dating to 2004.

    U.S. District Judge Otis Wright, however, found no showing of FHA violations within the two-year statute of limitations period prior to the December 2013 lawsuit.

    Oh, oopsie, did we forget to file our claim for 7 years during which time the statute of limitations ran out on their most egregious violations…our bad! (verdict: incompetent/corrupt prosecutors)

    Meanwhile, in the Chicago case, U.S. District Judge Gary Feinerman said Congress did not authorize entities such as Cook County to pursue an FHA claim to begin with.

    The county “alleges neither that it was denied a loan nor offered unfavorable terms – setting aside the obvious point that Cook County is not alleged to have a race or other protected trait,” Feinerman wrote.

    Shenanigans involving eldritch legal categories as an excuse for inaction–verdict: corrupt judge (or he’s just really dumb and not very creative)

    He said his decision did not mean that Wells Fargo complied with the FHA, or that “direct victims” of alleged abusive lending did not deserve compensation.

    He admits that they deserve compensation, but of course, none of them will ever see any, since they themselves are unlikely to hire lawyers and prevail in court, which is why you have the state do it, on behalf of their citizens…which the judge uses as an excuse to dismiss the case. Verdict: totally f-ed up “justice” system. Your tax-dollars at work, people…

    1. Brian

      California began trying to get rid of Wells Fargo long ago. They have tried to sue, to get them to cease operations, you name it. The feds said it is a US sanctioned terrorist and to screw off. Lets pretend shall we?

    1. notabanker

      Great link, thanks. And I agree, a pretty clear cut intellectual case for exit, but no preparation or political will to get it done.

  7. JohnnyGL


    Re: the Thomas Frank article in Salon, is this some kind of watershed moment on the left when one of the most prominent authors/advocates of “blame the voters for being stupid” and “Democrats lost the culture wars” actually shakes off the fuzzy-headed feeling and notices that Democratic Party leadership WANTS to sell out and play possum while the Republicans bulldoze over them.

    Who knows what’s next? At this rate he’ll be calling out Feinstein and her husband for making a killing on USPS privatization schemes?!?!?!

    1. Brindle

      Good to see an establishment liberal like Thomas Frank come to the same conclusion that most NC readers/commenters probably came to many years, if not decades, ago.
      Frank’s closing graf:

      —“The notion that Democrats might have agency is shocking, I know, since it means they bear some responsibility for our unhappy situation. However, once you acknowledge that it might be true, it occurs to you that this simple and direct explanation might also be the key to all kinds of Democratic betrayals and failures over the years, from the embrace of NAFTA to the abandonment of the Employee Free Choice Act. Maybe these episodes weren’t failures at all. Maybe it’s time we confronted the possibility that these disasters unfolded the way they did because Democratic leaders wanted them to work out that way”—

      1. Jess

        “Maybe it’s time we confronted the possibility that these disasters unfolded the way they did because Democratic leaders wanted them to work out that way”—”

        Gee, ya’ think?

    2. Oldeguy

      I’m not all that sure that Frank has been blaming the voters for being stupid; What’s The Matter With Kansas should still be essential reading for anyone hoping to use the political system to bring about change.
      The disastrous turning from a Class based Party to an Identity Politics conglomerate begun in 1972 virtually guaranteed the sold out Neo-Liberal Party B that is now an obstacle rather than a pathway to Real, as opposed to Symbolic ( at which the current Dems excel ) Reform.
      Should anyone doubt that Ms. Clinton embodies what Mr. Frank was describing, David Brooks, a reliable source of Elite thinking, gave his stamp of approval to her economy address which Mr. Strether so skillfully dissected at this site.

  8. john

    Kayfabe alert.

    Also, remember that Snowden worked for Allen-Booze-Hamilton. Even if the Hamilton was dropped from most establishment press coverage.

    Booze was a civil war or revolutionary general as well. Maybe both. Too early for me to bother to check up on that, but I recommend it.

    Slightly unrelated point, but the episcopal church uses a variant of the ‘confederate flag’ (aka the Cross of St. George) even though the shooting there is being used to ban the flag.

    1. Jim Haygood

      No surprise that anglicans (Church of England) use the Cross of St George, which is the flag of England. The downside?

      Many English people are now too embarrassed to fly the Cross of St George – because they think the nation’s flag has become too ‘chavvy’.

      Almost a third would not display the flag because it has become associated with football and lager louts, a social anthropologist Kate Fox has said.

      But of course, the Union Jack is an overlay of the crosses of St Andrew, St Patrick and St George, so it’s still there in the flags of the UK, Australia and New Zealand.

      New Zealand just closed the submittal period for proposing new national flag designs, which will be voted on in referenda next year. I’ve got a couple of dogs in that race.

    2. sleepy

      I have always been under the impression that the precursor of the Confederate battle flag was the cross of St. Andrew.

      1. john

        It’s been awhile since I did my research on the ‘ascencion (apoethesis?) of General Washington.’

        I appreciate the insight.

        Most people don’t know the Constitution in D.C.’s national mall is displayed next to the Magna Charta.

        Then again, even those who see it with their own eyes don’t stop to ask why.


        Also, I hear the first flag Columbus planted in ‘the New World’ belonged to some religious order.

  9. MyLessThanPrimeBeef

    Craving machine companionship???

    “Honey, I love you, not for your looks, but what’s inside.”

    A laptop doesn’t look like a robot. A desktop has no dangerous curves nor soft shoulders. It lacks those mesmerizing eyes. No silken skin there. A tablet has no long legs and even in all its nakedness, it hardly elicit much biological response from a teenage boy.

    But many people crave laptop/desktop/tablet companionship.

    That’s craving for ‘true’ machine companionship.

    I suspect that platonic, spiritual (beyond the superficial) connection is because, deep down, we (or a lot of us) have robotic genes that draw us and machines close together.

    That’s my guess.

  10. JTMcPhee

    Re: Gun-nut personal shootin’ drones, for fun, profit and yet more proof how f___ed up our species is: “This Weaponized Quadrotor is Fake, But Cool Viral Marketing for Upcoming Call of Duty Game,”

    And of course the video linked by NC is NOT fake. And you can effing bet that the kinds of people that find erotic and esoteric pleasure in killing other humans and inventing ever more exotic and compendious ways to do so, including “black swans” in the falsely labeled “life sciences” and the bland “area” of “robotics,” and little ol’ innocuous market-potential-is-huge-screw-the-concern-about-down-sides “nanotechnology,” are getting all moist about the actual Dronegun 0.9 in the NC link. And the many extant armed drones already being used to kill-from-a-distance, eventually without “human intervention” (other than all the “not MY fault” human decisions leading to autonomous killing machines) in the decision tree leading to the preferred-outcome programming of said autonomous killing machines to shoot to kill the “detected targets in the field of fire.”

    Stars and Stripes, the military-based publication that served as kind of a moral compass for me and others during the Vietnam “thing,” offers this as a small piece of one article on the advent of “mindful machine adjuncts,” “enhancing” the warfighting of actual soldiers who might decline to “do stupid” in the combat ordered by their Brass, as in and other stuff:

    Robotic ethics

    Despite the current limits of robotic technology, it’s time for the Defense Department and other authorities to seriously consider how the advanced robots of the future will be used, said a leading scholar of the ethics of military robotics.

    “Technology is fast, and ethics and law are slow,” philosopher Patrick Lin, of California Polytechnic State University, said in an email interview. “It’ll be far too late if we wait for robots to have real autonomy … [because] robotic autonomy may be upon us suddenly and well before we’d expect. We’ll be caught by surprise.”

    Leaving aside hypothetical future combat robots capable of autonomous attacks, even highly capable logistical robots raise ethical questions, Lin said. Will advanced “mules” like GUSS or fleets of unmanned Cargo UGVs lower the cost of entering a war of choice enough to make conflict more likely?

    Technical glitches in programming could lead to accidental atrocities or other battlefield errors, he said. How would culpability be determined?

    (By the way, got to love the economist-think example of meaning-in-context given by Wiki for “black swan:” “an unpredictable or unforeseen event, typically one with extreme consequences.
    ‘geopolitical black swan events, such as the Arab Spring and the Japanese earthquake, have further complicated the market dynamics'”

    Drones for unregulated personal and corporagovernment action seem to be following much the same “post-regulatory arc” as CB radio (remember that pre-Web fad?):

    After the 1973 oil crisis the U.S. government imposed a nationwide 55 mph speed limit, and fuel shortages and rationing were widespread. CB radio was used (especially by truckers) to locate service stations with better supplies of fuel, to notify other drivers of speed traps, and to organize blockades and convoys in a 1974 strike protesting the new speed limit and other trucking regulations. One leader was able to almost single-handedly coordinate an interstate highway blockade of hundreds of tractor-trailers in eastern Pennsylvania using the citizens band radio in his truck. His name was J.W. Edwards and his “handle” (or radio name) was “River Rat”. The blockade began on I-80 and quickly spread throughout the country, with River Rat’s messages literally being relayed from one area of trucks to the next.[8] The radios were crucial for independent truckers; many were paid by the mile, which meant their productivity was impacted by the 55-mph speed limit.[7] The use of CB radios in 1970s films such as Smokey and the Bandit (1977) and Convoy (1978), popular novelty songs such as C.W. McCall’s “Convoy” (1975) and on television series such as Movin’ On (debuted 1974) and The Dukes of Hazzard (debuted 1979) established CB radio as a nationwide craze in the USA in the mid- to late 1970s.

    Originally, CB required a purchased license ($20 in the early 1970s, reduced to $4 on March 1, 1975) and the use of a callsign; however, when the CB craze was at its peak many people ignored this requirement and invented their own nicknames (known as “handles”). Rules on authorized use of CB radio (along with lax enforcement) led to widespread disregard of the regulations (notably in antenna height, distance communications, licensing, call signs and transmitter power).

    Don’t waste a crisis, in search of profit and advancement: It seems human motivations kind of don’t reflect or respect national boundaries or adhere to distinctive ethical contexts, for some reason.

    “Hey, good buddy, this hyar is AhDon’tCare, comin’ atcha on Channel 11. Is there any commercial beaver workin’ over where y’all are parked at?”

    Yah, “market dynamics.” Riiiight.

  11. Jim Haygood

    Yanis V. goes down with guns blazing:

    Mr Varoufakis said Greece was subject to a programme that will “go down in history as the greatest disaster of macroeconomic management ever”.

    In a damning assessment, Mr Varoufakis told the BBC’s Mark Lobel: “This programme is going to fail whoever undertakes its implementation.”

    Asked how long that would take, he replied: “It has failed already.”

    My sentiments exactly. So where does this leave the handsomely-tanned Chris ‘Bronze Adonis’ Lagarde, who knows it’s wrong, but is going to rubber stamp it anyway? A robo-signer could do that.

    1. MyLessThanPrimeBeef

      He was working on something similar, just less austere.

      Was he ok with ‘the second greatest disaster,’ if this one is the greatest?

    2. Cugel

      Lagarde still wants to get along with Wolfgang Schäuble because the IMF already has its money on the table and he’s still running the show. But, that leaked report was simply a wake up call that the IMF cannot just ignore reality. The creditors must take a hair-cut or grant a 30 year grace period. That is going to have to happen, regardless of how much humiliation they dump on Greece or how soon Grexit happens.

      The IMF member countries are not happy about the biggest default in Fund history, and that the Fund is going to lose money because it broke its own rules. But, there’s a limit to what they can do. The money is already committed.

      Schäuble is going to succeed in destroying the Eurozone and attempting to reconstitute a new politically integrated EU run by an economics minister, but with just Germany, Finland, Slovakia, Denmark, and any other Northern country that will let Germany run the show as member states, and Southern Europe and probably France out.

      The French are trying to block this, but I think their efforts are doomed to failure because the debt really is unsustainable. Schäuble has rigged the game so that default is inevitable. He suffered a temporary setback when other countries temporarily blocked forced Grexit, but no more.

      “The FT reported on some interesting details of the negotiations in Brussels: The French Finance Minister Michel Sapin said his “confidence” in Angela Merkel was “shocked” when he arrived in Brussels and Wolfgang Schäuble presented his Grexit plan. Sapin said, Angela Merkel assured Francois Hollande even on the morning of Saturday, that she would “not allow Grexit”. At the height of the conflict, as the summit threatened to collapse, Hollande and Matteo Renzi stepped onto a terrace and have wondered what to do next. The two have finally agreed to form an alliance. The FT quoted an Italian negotiators with the words: “At that moment we realized that Italy and France can unite to enforce a less radical solution than a Grexit.”

      But, for how long until the whole house of cards comes tumbling down?

      1. Yves Smith Post author

        1. The IMF still have 16.4 billion euros to distribute in the current program (the “second bailout”). It will probably avoid cutting its deal on the third bailout till that is distributed. But that will happen only as a result of the arrearage being clearers up, ie, the Europeans paying off the IMF. The IMF is the senior lender. It has first dibs in the case of any shortfalls.

        2. The IMF has a ton of power here. Germany will not go in unless the IMF is in. Schauble wants Greece out. If Lagarde were playing ball with Schauble, they’d be on the same page re having the IMF out, since he’d get his Grexit. So this is NOT Lagarde knuckling under to Schauble. This is Lagarde serving herself, since she was almost certain to be out as of next July (she was always very unlikely to get a second term, since the emerging economies that have half the board seats were outraged that DSK was followed by another European. They want their turn). So Lagarde is following the path of least resistance for her personally and engaging in “IBG/YBG” (“I’ll be gone, you’ll be gone”) behavior. She won’t be the one who has to live with the consequences of signing up for the third bailout.

        1. IsabelPS

          Just realized that Lagarde will exit the IMF at the perfect time for running for president in the French elections (april-may 2017).

          1. OpenThePodBayDoorsHAL

            Kind of like how Bernanke exited and left the mess for Grandma Yellen to try and clean up. In rugby they have a term “hospital pass”, when you pass the ball to a teammate just as he’s about to get smashed

        2. Cugel

          Yves, if the IMF agrees to a third bailout, which will be larger than the first two, how can they even pretend that Greece will pay it? Their own analysts are in open revolt, the Member states are angry that the EU forced them into this mess. They only way the IMF gets paid is if it agrees in principle to a new round of permanent financing, which means throwing even more good money to get repaid the bad.

          Yes, the IMF has power, but how is that meaningful? The EU cannot manage the program without the IMF because they lack the technical expertise for monitoring. Well, so what? That simply means the program cannot “succeed” without the IMF. But, the program cannot succeed anyway, and Schäuble doesn’t even want it to. He was blocked temporarily, but he clearly has more power in the Bundestag than Merkel. He could have torpedoed the deal, but apparently did not consider that the Greeks would swallow the total humiliation, which left him no excuse.

          The only question is whether the other IMF member states will let Lagarde get away with doubling down on disaster. In the face of this open rebellion from the IMF staff, how can they?

          Lagarde will be out next year, but Schäuble still has the upper hand. He knows what everybody knows, that Grexit is still inevitable, that the Greeks cannot pay and so will not pay. He knows this and wants Grexit, the others like Rienzi and Hollande know it and want to extend and pretend forever because they are the ones to lose if Grexit happens.

          So, it appears that nobody has a realistic plan, other than Schäuble. He sees disaster as opportunity. The others simply want to defy gravity forever and agree to a 3rd round of bailout, larger than the first two. And this presupposes that Greece can be forced to comply. Syriza has split, ND and the other pro-Austerity parties have ZERO credibility and are facing elections soon amid growing despair and economic collapse. I keep harping on the administration of Heinrich Bruning, Germany’s Hunger Chancellor of 1932, because it bears such an uncanny resemblance to Greece today. No attempt to rule by executive decree in the midst of chaos and collapse without parliamentary support can succeed. Last time it led to the Nazis. Now, even Syriza’s friend and apologist James K. Galbraith has admitted:

          “What will become of Europe? Clearly the hopes of the pro-European, reformist left are now over. That will leave the future in the hands of the anti-European parties, including UKIP, the National Front in France, and Golden Dawn in Greece. These are ugly, racist, xenophobic groups; Golden Dawn has proposed concentration camps for immigrants in its platform. The only counter, now, is for progressive and democratic forces to regroup behind the banner of national democratic restoration. Which means that the left in Europe will also now swing against the euro.”

  12. Anon

    Re: Thomas Frank

    I believe the article was mentioned in either a previous Links OR one of the earlier Water Coolers. Still an apt observation, nonetheless.

  13. Brindle


    The Guardian has a piece up on Clinton Sanders & O’Malley in Iowa. Like the inference that Sanders supporters are smart enough to stay out of the heat:

    —-The room at the Hall of Fame dinner felt that Clinton influence. Reporters were penned off, either because mixing press and attendees presented security issues – according to the secret service – or to “allow the event to move along”, according to a spokesman for the Iowa Democratic Party. This represented a major shift, according to one Iowa Democratic insider, from past practice at party events.

    This did not mean that there were no old-fashioned politics at the event. On the street outside, a sign war was waged between supporters of Clinton and O’Malley in the nearly 100F heat. Staffers from both campaigns waved signs and shouted cheers. Unsurprisingly, Clinton had more people – O’Malley supporters, divided between those affiliated with his campaign and his Super Pac, struggled mightily to stay competitive.

    The Sanders campaign did not have any such presence. Instead, 37 supporters stayed in the air conditioning and got to meet the candidate.—-

  14. susan the other

    “Reflection related to European Pollicy” – Interesting link to the Maastricht Treaty and the formation of the EU. 1994. It was virtually impossible to actually “read” but easy to grok. The whole point seems to have been to protect Europe from Russia and the chaos in eastern Europe by “protecting the core.” Germany and France. And maintaining and strengthening alliances with the Atlanticists. Since the US had been the big protector of Germany, Germany seems to be looking to replace this security with the EU. The goal was always to protect Germany. And maintain alliances with the US to that end. Apparently never to form a more perfect union.

  15. DJG

    Wonderful antidote of the day. Okay, local entomomogist peeps, just what species does this caterpillar belong to?

    Is it holding a tomato? I hope that I haven’t inadvertently just praised a tomato hornworm. One never knows–a flashy rhetorical stance can mean deception…

    1. Gio Bruno

      The antidote: Dasylophia anguina ; Black-spotted Prominent (moth). The larva in the picture will, of course, envelope itself in a caseing, then devour itself, and re-emerge as the moth. Found all over N. America. The moth is maybe an inch and a half across its wing tips.

  16. EmilianoZ

    The Germans have a heart. Reem, a young Palestinian refugee in Germany, was caught on camera crying when Angela Merkel told her she would be sent back to Lebanon. But now the authorities in Rostock where she lives have said she that Reem would be allowed to stay in Germany.

    This incident suggests that the Greeks have been pursuing the wrong strategy all along, with all the manly alpha male bluster from Varoufakis and Tsipras. Tsipras should put himself on a plane to Berlin pronto and not be afraid to get in contact with his softer side.

  17. optimader

    Elizabeth Warren Challenges Hillary Clinton to End the Revolving Door New Republic (resilc)
    Do I remember correctly that was part of BHO original platform? HRC would be foolish not to test it , embrace it if it’s to her advantage taking it off the table during the campaign. then if elected, do whatever the hell she wants in true POTUS tradition.
    Actually, HRC should test every Warren position and lie & misrepresent accordingly to her own advantage, basically kneecapping Warren from the getgo.

  18. willf

    Finally (later than we’d like, but later is better than never) Frank calls out the Vichy Left.

    This article is from last January.

  19. optimader

    Obama’s Nuclear Deal With Iran: Rare Victory for Peace or Foolish Compromise? Michael Shedlock


    Pragmatically, when did Iran last start a war?
    Historically a nonaggressive country that happens to have a theocratic government that is not to my taste. I look forward to going skiing there and offering my modest efforts to corrupt them.
    Skiing in Iran by Warren Miller

    1. NotTimothyGeithner

      Europe and Asia were done with sanctions, and Obama and other western politicians needed political cover to deal with the reality. Germany and France opening up Iran or Iran joining the SCO while still a pariah in Washington would show far the U.S.’s prestige has dropped.

  20. micky9finger

    What am I not getting?
    If Greek banks are ful of Euros, in accounts where people put them, then why does not the central European bank not provide the actual currency to give to those who want their Euros to hold?
    These are Euros that already exist. The central bank needs to print them up and ship them to Greece.
    Is this the lawess illegal behavior of the European Central Bank?

    1. MyLessThanPrimeBeef

      A very good point.

      Currency/capital controls

      Can the controls be like this:

      1. The Greek government gets some person/entity to open up an account in Germany
      2. The Greek government confiscate all Euros in accounts inside Greece and wire it to the above account
      3. Cash that account in Germany
      4. Truck/airmail that cash money (pallets) back to Greece
      5. Un-confiscate step 2 above.

      1. Jeremy Grimm

        From:Mohammed Abacha Lagos-Nigeria Tel: 234-80-34069502

        Dear Greece,

        This letter is not intended to to cause any embarrassment but just to contact your esteem self-following the knowledge of your high repute and trustworthiness.

        I am Mohammed Abacha,the son of the late Nigerian Head of State who died on the 8th of June 2015. I got your contacts through NakedCaptialism. I can offer you assistance at this time of need.You have absolutely nothing to loose in working with me, you have so much to gain.

        Please my dear,I repose great confidence in you and I hope you will not betray my confidence in you. With your assistance I can secretly deposit the sum total of all Greek Euro deposits with an account in Germany held by a security firm abroad whose name is withheld for now until we open communications.

        I shall be grateful if you could transfer your funds into this secure German Bank account for safekeeping. This arrangement is known to you and my junior brother (Abbas) only. So I will deal directly with you.I am proposing a 0.0001% share of the fund to myself for providing this assistance.I shall provide for you all the documents of the fund deposit with the security firm, and raise a power of attorney to enable you claim and receive these funds as Euro monetary bills for shipment to your banks in Greece. I have done a thorough homework and fine-tuned the best way to create you as the beneficiary to the funds and effect the transfer accordingly.Is rest assured that the modalities I have resolved to finalize the entire project guarantees our safety and the successful transfer of the funds.So, you will be absolutely right when you say that this project is risk free and viable.If you are capable and willing to assist, contact me at once via email with following details:

        1. YOUR NAME

        Also this transaction demands absolute confidentiality.On no condition must you disclose it to anybody irrespective of your relation with the person.Remember,Loose lips sinks ship.I am looking forward to your urgent and positive response via my email address above.

        Best Regards,

        Mohammed Abacha.

  21. flora

    Thanks much for “Greece, Europe, and the United States” by James Galbraith in Harpers. His reference to the 1968 Soviet invasion of Czechoslovakia is on point re: neoliberalism.

  22. dante

    Re:Let’s Get Real About Gold: It’s a Pet Rock Wall Street Journal. Or trading sardines.

    So why isn’t gold ‘working’ at this moment in history?

    “We hypothesize that, having learned from the misadventures of the 1960s, the policy elites, well-versed in the practice of financial engineering and market manipulation, would have seen no need to dump stocks of government gold reserves onto the market, 1960s style, to keep the price in check.

    Instead, synthetic gold, sourced in pyramids of credit extended to bullion bankers by central banks
    with little or no claim on physical substance, have provided a more efficient, better-camouflaged form of intervention. COMEX synthetic gold and related over-the-counter derivatives are traded in macro strategies implemented by hedge funds, high-frequency trades, and commodity funds in pair trades with interest-rate, currencies, equity futures, or even more exotic offsets. The volumes traded are huge, and bear little resemblance to actual flows of physical metal.

    We suspect that shorting gold has come to seem like a riskless proposition as long as there is confidence in the Fed. Synthetic gold is the perfect substance for a carry trade: an easy borrow with very low carrying cost and little upside basis risk. Such a hypothesis, in our opinion, does much to explain the incongruity of a declining gold price while fundamentals for paper currency, and the U.S. dollar in particular, obviously deteriorate; while demand for physical gold has exceeded new mine supply for several years running; and while above-ground 400-ounce .995-gold bars located in London, New York, and other financial capitals (in cohabitation with speculative trading activity in paper markets) have steadily dwindled and disappeared into Asian financial centers reformulated as .9999 kilo bars.”

    Tocqueville Gold Newsletter 2Q 2015

    The dumping at market of very large amounts of paper assets into quiet market hours has been well documented in many places. It is a well worn market manipulating strategy abused by some very large trading desks, often playing with other people’s money. Citi privately called it their ‘Dr. Evil Strategy.’

    It is funny how the systematic rigging of so many financially related markets has been revealed, but the blatant manipulation of the precious metals market, which is certainly knowable by anyone with a basic knowledge of the markets and a computer terminal, is so willfully ignored. A love of money, lust for power, and a lack of integrity will alloy to make people hypocrites.

    everyone on n/c complains about financialization/securitization/fraud, etc….yet the blinders come on when it’s convenient?

  23. lord koos

    Re the WSJ piece — the campaign against gold is reaching a peak. There is much manipulation in the precious metals markets, which being small, are pretty easy for mega banks like J.P. Morgan to push around using sales of paper contracts to drive down the price of the physical metal. Meanwhile, China, Russia, India and others continue to buy thousands of tons of it. in the west, the current COMEX open interest in gold has gone parabolic, currently there are 97 paper claims on each physical ounce. In silver, the open interest exceeds the amount of silver that can be produced in one year. JPM has also amassed a huge stockpile of physical silver. If the metals are simply “pet rocks” then why is there so much interest in them?

    1. JCC

      It would seem the human psychology of a couple of thousand years of faith in precious metals as currency is more powerful than 45 years of faith in the US Dollar as currency. Go figure.

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